The Elderly Client: 4 Tips to Deal With Cognitive Decline

Advisors are very busy people, and now here’s something else for them to add to their to-do lists: help clients and their families face the facts about cognitive decline and how it affects financial decision-making skills.

Despite the vivid reminders of what happens as we age — from forgetting to pay a bill to coping with a diagnosis of Alzheimer’s disease — the majority of Americans avoid talking to their children and families about planning for the inevitable, according to a survey by the National Endowment for Financial Education (NEFE).

Conducted online by Harris Interactive in November among 2,059 U.S. adults, the survey finds that seven in 10 Americans say “major barriers” prevent them from communicating about who will make financial decisions on behalf of an aging family member unable to make them due to cognitive decline.

“Americans are living longer and they have concerns about becoming a burden to their loved ones,” said NEFE President and CEO Ted Beck in a statement. “But with aging comes a high probability that mental decline can occur, and without a financial plan, the burden looms.”

Forty-seven percent of NEFE survey respondents said they or family members with cognitive decline have had trouble paying bills, whether paying them late or not at all. A full 36% reported difficulties calculating simple math problems; 35% made irrational purchases; and 21% depleted their savings accounts.

Yet the majority of people said that family dynamics got in the way of trusting a relative to make financial decisions, according to the NEFE, a Denver-based private nonprofit foundation with a mission of educating Americans about personal finance. NEFE is funded by its own endowment, which was established with proceeds from the 1997 sale of the College for Financial Planning’s assets, including a building and the rights to its professional education programs. The nonprofit offers a Smart About Money site to help consumers with financial planning decisions.

“Frequently there is defensiveness, denial, embarrassment and sibling rivalry when entering into a dialogue between adult children and a parent concerning their finances,” Beck said.

In many cases, that puts advisors in the position of creating a financial plan and helping an aging parent select who they prefer to take leadership of their finances. Read on to learn about the NEFE’s top four tips for helping clients and their family members face cognitive decline issues.

1) Gather information. Urge families to take the time to learn as much as they can about the illness or medical condition that is impacting an aging family member’s financial capacity. Attend support groups and reach out to experts who handle matters related to Alzheimer’s, dementia or other diseases. If a parent’s cognitive decline is due to grief, reach out to a grief counselor.

“Share what you learn,” says the National Endowment for Financial Education (NEFE). “This also is a good time to do a financial inventory. Consolidate accounts into as few as possible so it is easier to track and manage transactions. Also make sure that a will and financial power of attorney are current.”

2) Be compassionate. Approach the family member experiencing cognitive decline in a positive and supportive way to let them know that you are there to offer your help and support. Be sensitive to their point of view, keeping in mind that they have worked hard over a lifetime to accumulate their resources. The aging family member may be apprehensive about relinquishing control of their finances.

“Family members should be sure to involve the aging parent in the process of developing a plan where you are assisting them with their finances. Remember, this is ‘their’ plan so be sure to follow their wishes,” cautions NEFE President and CEO Ted Beck.

3) Implement the plan. Once the time has come for a plan to be implemented, the family member in charge of overseeing the aging parent’s finances should create a calendar of bills to be paid each month, checking in to ensure that bills are being paid on time and for the correct amounts, says the NEFE.

Accounts of aging parents also should be monitored to check for any unusual activity, and annual credit checks should be done to safeguard against identity theft.

4) Divide caregiving duties. The NEFE recommends that families have an honest and open discussion among siblings about a parent’s cognitive decline, what needs to be done, and what caregiving roles each family member wishes to play: “Set up a schedule for each sibling. Keep family members who do not live nearby updated with weekly emails or phone calls. Invite all siblings who wish to take on some responsibility to do so.”

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Read Olivia Mellan on “Your Client’s Brain: Coping as Your Clients Age” at AdvisorOne.

5 Ways To Increase Your Chances Of Getting A Job After College

There's a disturbing trend in America and it's causing soon to be high school graduates to question whether college truly is the key to finding success in a difficult job market. A recent report by the Associated Press found that one out of every two college graduates is either unemployed or underemployed, often working in a field that isn't related to their degree. This, along with the student loan debt topping $1 trillion, is causing graduates to find themselves with low-paying jobs that make them no better off than if they hadn't gone to college at all.

According to economists, college is still the best way to land the higher-paying jobs, but no longer is the act of attending college the key to success. Making the wrong decisions before entering college can hurt your chances of putting your degree to work later on.

Have a Plan
It used to be OK to head to college now and figure out a degree later. According to MyMajor.com, 80% of students entering college hadn't picked a major and 50% will change their major while in college. With rising college tuition and students spending more time in college, they are amassing more debt which translates into higher payments upon graduation. Harvard economist Richard Freeman advises students who are undecided about their future plans to find a job after high school until they decide what they want to study instead of heading to college without a clear plan.

Don't Follow Your Passion
Mark Cuban, entrepreneur and star of the hit television series Shark Tank, advises people not to follow their passion. According to Cuban, we have a lot of passions in our life, but most won't translate into successful careers. Instead, he advises to follow our effort. Look at how you spend your time. Whatever you spend the most time doing may be your perfect career. When we spend time with something, we gain a lot of skill which makes us an expert in that field and being an expert translates to career success.

Create a Barrier
Pursuing a profession that requires a specialized degree creates a barrier to entry. Fields like medicine, education, law and accounting require that you have a degree in order to gain the certification needed to apply for those jobs. Other careers, like the arts, many business jobs and sports management, have collegiate degree programs, but they aren't required to work in the field making the amount of eligible people much higher.

Check BLS
The Bureau of Labor Statistics' website has detailed information about most career paths including average salary and the amount of people needed in those careers in the future. If you're considering more than one degree path, choose one that will have a large need for workers in the future. Fields that have a saturated market not only make it harder to find a job, but the salary may also go down due to the oversupply of workers willing to work for less.

Reduce Your Debt
There are plenty of ways to reduce college debt. Go to a state college if appropriate for your field. You can live at home instead of paying the high price of campus housing, purchase used books, work a part time job if your degree program allows or take summer classes to reduce the amount of time you're in school.

The Bottom Line
Although the college years are still full of fun and great memories for many, making the most of your college education is essential to having the best chances of finding the job you dreamed of having. Remember, the sooner you get out of college, the sooner you will earn money instead of building up more debt.

Sign up for Dividends from John Hancock

This fund is basically an actively managed mutual fund, but it just happens to trade on an exchange, explains income specialist Ari Charney of Big Yield Hunting.

Income-oriented investors will appreciate this closed-end fund's mandate, which requires it to deliver high current income along with modest capital gains.

John Hancock Premium Dividend Fund (PDT) tends to allocate roughly 30% to 40% of the portfolio to equities and 60% to 70% to preferred stock, with the utilities and financial sectors as its main focus.

Management does use substantial leverage to boost its payout and returns, but it's done so while delivering excellent long-term returns.

Over the past five years, utilities have taken up as much as 61% of assets, while financials are currently at their highest weighting over that period.

The seasoned management team, one of whom has been with the fund for over 18 years, tends to invest with conviction. In fact, portfolio turnover has averaged just 14% over the past five years.

I also reviewed the fund's performance during the Fed's last tightening cycle, which ran from June 2004 though September 2007. Over that period, PDT still managed to gain 4.5% annually on a net asset value (NAV) basis, 0.9% annually on a price basis, and 7.2% annually on a price basis with the reinvestment of distributions.

So, a rising-rate environment clearly poses a challenge, though the fund should be able to hold its value, while continuing to pay its distribution.

And, in contrast to many of its peers, PDT's monthly distribution typically consists of net investment income and the occasional long-term capital gain, without any destructive returns of capital.

Aside from rates, of course, I'm also concerned that yield-starved investors have pushed both utilities and preferreds higher and higher, without regard to price. But I trust the management team's value-oriented approach to keep them from chasing the high flyers.

The financial sector's dominance of preferred stock issuance could soon change, as the Federal Reserve has ruled that it will no longer allow bank holding companies to count trust preferreds toward Tier 1 capital, though it will grandfather existing preferreds for smaller institutions. It remains to be seen how these changes will affect the preferred market.

Finally, investors should be aware of the fund's dividend reinvestment program (DRIP). New investors are automatically enrolled, so if you prefer to receive the distribution as cash, you'll have to opt out of it.

But the DRIP also offers a significant benefit: Whenever shares trade at a premium to NAV, distributions are reinvested at the NAV or at 95% of the market price.

So, at the very least, DRIP participants will never pay the market price when PDT trades at a premium. When it trades at a discount, reinvestments are done at the prevailing market price.

Subscribe to Big Yield Hunting here…

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Why the Dow Likes Bad Economic News

To any ordinary person, the recent movements in the stock market don't make much intuitive sense. Today, for instance, news that weekly jobless claims rose and revised U.S. GDP figures were weaker than expected would lead most non-investors to expect the stock market to decline. Yet in the upside-down world of Federal Reserve monetary policy, investors have taken bad news for the economy as good news for the markets, in the belief that a longer period of Fed intervention through quantitative easing and low interest rates will boost the stock market. At least for now, the Dow Jones Industrials (DJINDICES: ^DJI  ) are reflecting this recent trend, gaining 63 points by 10:45 a.m. EDT, marking a turnaround from yesterday's triple-digit losses. The broader market is also higher, showing that the phenomenon applies beyond the Dow.

When the Dow's movements don't make sense, it's more important to focus on fundamentals in your investing. For instance, Caterpillar (NYSE: CAT  ) has struggled recently because of its high exposure to the slowing Chinese economy, and that has held the stock back despite the Dow's record run. Yet with an attractive valuation of just 11 times trailing earnings, Caterpillar offers a margin of safety even if the reductions in future earnings estimates that we've seen recently continue. You'd have to see substantial further deterioration in the global economic environment before Caterpillar's stock would look expensive at these levels.

Tech stocks have also offered attractive values to investors willing to take on the risk of turnaround projects. Both Intel (NASDAQ: INTC  ) and Cisco Systems (NASDAQ: CSCO  ) trade at below-market multiples, in large part because of concerns about heightened competition among big tech companies and a transition toward broader offerings throughout the IT space, rather than niche segments of the market. Investors fear that Intel won't be able to diversify beyond its PC-chip dominance and that Cisco will lose its place atop the networking space while failing to get a foothold in broader IT services. Yet low valuations -- Intel and Cisco trade on respective P/Es of 12 and 13.5 -- discount their current business prospects far more than appears justified, even given concerns about low IT spending levels throughout the industry.

Beyond the fundamentals, though, news plays an important role in short-term stock movements. Outside the Dow, microturbine producer Capstone Turbine (NASDAQ: CPST  ) soared 8.8% after receiving its second large order in the past week. After getting word of a purchase from real-estate and investment firm Related Companies on Tuesday, Capstone got an order today from Southern California Gas to buy three of its C65 uninterruptible power-source units for use at the gas company's data center. Given the relatively small size of the business, which sports sales of only about $122 million over the past year, orders like this have a material effect on Capstone and also draw the attention of other prospective buyers.

The overall lesson, though, is not to let the Dow's Fed-affected moves confuse you. By keeping focused on the long run, you'll avoid drawing bad conclusions from the market's short-term jumps and plunges.

Once a highflying tech darling, Cisco is now on the radar of value-oriented dividend-lovers. Get the lowdown on the routing juggernaut in The Motley Fool's premium report. Click here now to get started.

This Is How Social Media Companies Make Money

Over the last month we've seen Facebook's (Nasdaq: FB) dramatic share price rebound, Twitter's stock IPO announcement, and LinkedIn (NYSE: LNKD) stock on fire, but have you ever wondered... how do social media companies make money?

To find out, we turned to Money Morning E-commerce Director Bret Holmes. Part of Holmes' job is to utilize web advertising via social media platforms to best market Money Morning. As a result, he's on top of what's going on inside of today's social media giants.

Holmes said the key to unlocking value for social media companies is successful advertising models.

"Social media companies are legitimate advertising websites, no different than, say, Google or Yahoo. The same way Google made its money is the same way Twitter and Facebook will make their money," Holmes explained.

Web advertising is a growing market. In a 2013 Nielsen report, data showed that 89% of advertisers use free social media advertising, and 75% use paid social media advertising. The report also highlighted that 64% of advertisers expect to increase their paid social media advertising budgets over the course of 2013.

That means a lot of opportunity for social media companies to make major money.

The trick for social media companies looking to profit as ad platforms is to find the best way to insert advertising into the user's experience without impacting the user in a negative way.

For any doubters out there who don't believe that advertising methodology is hugely important to investing in social media stocks, take heed...

In late July, Facebook announced that mobile ads account for a whopping 41% of its $1.6 billion second quarter ad revenue. Facebook shares closed at $26.51 that day. But in after-hours trading, shares skyrocketed to nearly $31.

It's clear that advertising plays a huge role in a social media company's value - and the success of social media stocks.

To learn how to gauge which companies will succeed, here's how social media advertising actually works...

How Social Media Companies Make Money: A Lesson from Facebook

The Facebook initial public offering (IPO) was an unmitigated disaster. It lost more than half of its value within six months of listing and was priced at 107 times trailing 12-month earnings, making it pricier than 99% of all companies in the S&P 500 at the time.

But boy did it rebound.

From July through September, the Facebook stock price has more than doubled. On Sept. 30, it hit an all-time high of $51.5 a share, putting it $13.5 over its IPO price of $38.

It was advertising that undoubtedly turned the tides for Facebook.

"Facebook has gotten really good at advertising. It's new, it's inexpensive, and it's smartly done," Holmes said. "When Google first started, it wasn't good at advertising, and look at them now. Facebook is going to be a success story."

Here is what Facebook did to unlock its value and become what Holmes described as "the most advantageously competitive product on the market for advertisers, hands down"...

Originally, Facebook started with space ads. Then, it added self-promoting individuals' or a company's Facebook page. But things were still sluggish.

However, about nine months ago, Facebook developed a new advertising format.

"Facebook has integrated in-stream ads to the user experience. Response rates are high and advertisers will always chase the least expensive ad with the best response. It works because it's new and cheap," said Holmes.

In-stream ads can be videos. For instance, a commercial will appear before the user may watch an Internet video. The in-stream video ad will typically last 15-30 seconds.

On a social media site like Facebook, which has real-time update feeds, in-stream ads can be inserted into a streaming feed. So, for example, the user scrolls through the News Feed to see what friends and family are up to, and in-stream ads are peppered into the Feed.

By far the largest social network, Facebook saw over $1 billion in ad revenue at the beginning of 2013, and it's getting better at integrating ads into its News Feed.

"Recently, Facebook let advertisers access FBX, an ad exchange where you can customize your own ads," explained Holmes. "Now we can glean information and better target our audience. We can also advertise on mobile now."

The ad model is helping Facebook monetize its massive 1.15 billion users who increasingly access the site via mobile devices.

And to top it all off, Facebook continuously improves its method to provide performance-based analytics that are invaluable to advertisers.

Watching Facebook's advertising Cinderella story shows us a great deal about how advertising makes money for social media companies. Having taken a glimpse into the past, we can now see if Twitter - and its stock - will have the same success...

Twitter Stock Success Hinges on Ad Model

Just on Sept. 12, Twitter filed its IPO. And according to Holmes, its advertising will have to improve to make it a viable success.

"Twitter is going to start off similarly to where Facebook did last year," Holmes said. "Advertisers aren't flocking to Twitter. I'm sure it will try outside ads, and that will probably yield good results, but unfortunately for Twitter, it just doesn't have the right demographic."

According to an August study released by nonprofit research company Pew Internet, Facebook not only has by far the largest user base, but it also reaches an older demographic.

When compared to other social media sites, Facebook blows away the competition - as shown in this chart by Adweek.

Reaching an older demographic means you're reaching more users who click ads. According to PaidContent.org, women over the age of 50 have a 22% click rate, significantly higher than any other demographic.

"If Twitter can tweak its advertising and reach an older demographic, it will get closer to the kind of profitability that has fueled Facebook's rise over the last four months," Holmes noted.

Just yesterday, the Twitter IPO became official - the U.S. Securities and Exchange Commission filing was revealed to the public. The symbol is to be TWTR, though no exchange, pricing, or share information has been listed yet.

But will Twitter's IPO bomb like Facebook's?

Here are 5 reasons why we think it won't...

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Why Universal Display Is Poised to Bounce Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, organic light-emitting diode manufacturer Universal Display (NASDAQ: OLED  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Universal Display and see what CAPS investors are saying about the stock right now.

Universal Display facts

Headquarters (founded)	Ewing, N.J. (1985)
Market Cap	$1.4 billion
Industry	Electronic components
Trailing-12-Month Revenue	$83.2 million
Management	CEO Steven Abramson (since 2008) CFO Sidney Rosenblatt (since 1995)
Return on Equity (average, past 3 years)	(9.9%)
Cash/Debt	$243.9 million / $0
Competitors	BASF Eastman Kodak Sumitomo Chemical

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 95% of the 1,295 members who have rated Universal Display believe the stock will outperform the S&P 500 going forward.

Just yesterday, fellow Fool Simon Erickson (TMFInnovator) summed up the Universal Display bull case for our community:

Over 1000 issued and pending patents on OLED technology. They have the know-how in this fast-growing industry. OLEDs shine brighter and are more energy efficient than current lighting technology. They're a better mousetrap.

- HUGE opportunity if OLED's catch on in televisions. DisplaySearch research estimates the OLED TV market to reach $16 billion of revenue by 2020.

- Extremely high profit margins, and revenues have doubled in each of the past two years.

Smartphone displays for Samsung have given them a good foothold and reputation in the industry. Adoption of OLED TV's will no-doubt be the long-term driver of growth. And the wildcard is if Apple adopts OLEDs for the iPod. ... That development would blow the roof off.

Many are impatient with the long-term story, as OLEDs always seem to be "around the corner". But I like the risk/reward trade-off.

If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong four-star rating, Universal Display may not be your top choice.

We've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2013." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Should Apple, Inc. Worry About Subsidy Cuts in China?

Once upon a time, Apple (NASDAQ: AAPL  ) investors were easily rattled by any headlines about carrier subsidy cuts. That made sense because most people still aren't willing to pay full sticker price for an iPhone, but at the same time subsidies played an important role in customer acquisition for carriers.

Well, one of Apple's newest prominent carriers is looking to reduce subsidy costs: China Mobile (NYSE: CHL  ) . Should Apple be worried?

Shifting to the mainstream
Bloomberg first reported last month that China Mobile was looking to reduce subsidies by $2 billion, following up again today with additional details on China Mobile's intentions to cut costs. Government agencies told the state-controlled carrier that it spent too much on subsidies and marketing for devices like the iPhone, among others.

The net result is that the cost for an iPhone 5s could end up doubling, while the iPhone 6 is still in the process of getting regulatory approvals before launching. China Mobile is shifting its focus away from the high-end and toward the mainstream, which inevitably could benefit local smartphone manufacturers like Xiaomi and Huawei, which offer more affordable smartphones.

What's different
Chinese carriers structure subsidies very differently than U.S. carriers do. U.S. consumers are used to paying less upfront in exchange for higher monthly bills, while in contrast Chinese consumers pay more upfront in exchange for lower monthly bills.

Under China Mobile's old structure for an iPhone 5s, consumers would pay 5,288 yuan (~$860) upfront but then receive monthly rebates of 194 yuan (~$32) for two years to offset the cost. Now the upfront cost will be 4,488 yuan (~$730) with the monthly rebate falling to 136 yuan (~$22). After everything is said and done, consumers end up paying nearly twice as much for the phone.

But since the upfront cost is lower and the added cost is spread over the course of two years, the overall impact to Apple's business is unclear, but could even potentially be positive if you consider the behavior of U.S. consumers. We do know that in the U.S., spreading out premiums over time has led to consumers becoming less price sensitive, which ends up shifting Apple's product mix toward higher-priced models.

Other considerations
Additionally, Apple has been making broad pushes in making its devices more affordable in emerging markets, with installment plans being its primary tool. The Mac maker launched installment plans in China in early 2013, partnering with third-party banks -- China Merchants Bank and ICBC -- to handle the financing. These plans do come at a cost, with interest rates that go as high as 10%, but offer lower upfront costs to customers.

Perhaps more importantly, Apple's entry into the phablet market represents an enormous opportunity for the company, since phablets are extremely popular in China. Phablets do cost more, but eager Chinese consumers are already buying iPhone 6 models for upwards of $3,000 in the grey market pending the official launch in mainland China. Of course, early adopters willing to pay exorbitant grey market prices may not be representative of the mainstream market.

China Mobile reducing subsidies isn't exactly good news, but it probably won't put a dent in Apple's business.

Apple Watch revealed: The real winner is inside
Apple recently revealed the product of its secret-development "dream team" -- Apple Watch. The secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see where the real money is to be made, just click here!

Your Digital Life: Your phone is not invited to…

Steven Petrow helps you navigate the digital world in the real world.

I recently hosted a dinner party and one of my guests had his phone on the table the entire time. He never checked it, but it was looming as if a call might interrupt us at any moment. I didn't say anything, but I'm wondering if I could have asked him to put it away without seeming rude myself.

~H.M., Rehoboth Beach, Del.

I'm sure you were afraid of what happens all too often – dinner guests checking their phones throughout the evening, texting under the table or hearing the dreaded Marimba iPhone ring stop all conversation dead in its tracks. Leaving your phone sitting out on the dinner table is like wearing a sign that says "Yes, I'm here, but I may get a better offer at any moment."

Frankly, I'd urge you to ask your guests to refrain from using their phones – or having them lurk – at the table. I'd say it with as much good grace ("May I take that for you so we're not all distracted by it?") or humor ("I didn't set a place for Siri, so let's put her away now") as possible. Either way, your message will be clear: Electronic devices do not have a seat at your table.

To guests: Even without such an admonition, please keep your smartphones in a pocket or purse – not on the table like a package of TNT ready to detonate. Yes, you have my permission to slip out to the restroom from time to time and check your phone. (And if you're a doctor on call or otherwise expecting a truly important phone call, tell your hosts ahead of time; I'm sure they'll be happy to waive the usual dinnertime rule).

As a last resort, I love this new dinnertime ritual: Ask your guests to put their smartphones in the center of the table; the guest who reaches for his or hers first has to stay and do the dishes (or, in a restaurant, pay the bill). Believe me this works!

Read more of Steven Petrow's Your Digital Life columns on usaweekend.com. Submit your question below. You can also follow Steven on Twitter @StevenPe! trow and like him on Facebook at facebook.com/stevenpetrow.

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FINRA ‘Aggressively’ Seeking BD Feedback on CARDS: Ketchum

Richard Ketchum, chairman and CEO of the Financial Industry Regulatory Authority, said Monday that while the self-regulator was moving ahead with its controversial Comprehensive Automated Risk Data System (CARDS) as it’s “the next step—and big leap forward—in the evolution” of FINRA’s risk-based regulatory programs, FINRA has created broker-dealer working groups and is "aggressively" seeking BD feedback to “get this right.”

Noting the more than 800 comment letters that FINRA received on its CARDS plan, Ketchum told the 1,000 attendees at FINRA’s annual conference in Washington that “your input is critical to us getting CARDS right. By giving us your feedback, you have an opportunity to contribute to the best solution possible. Please help us shape this.”

However, Ketchum said that while FINRA is “looking closely” at the cost and operational concerns that broker-dealers have raised, many commenters’ concerns “seem to me to be a tad one-sided.”

CARDS, Ketchum argued, “has the potential to be one of the most important investor protection tools to emerge in recent years,” and “strongly urged” BDs to view CARDS “through the broader lens of investor protection, rather than through the more narrow lens of how it affects your firm.”

That being said, Ketchum said that FINRA recognized “that costs tied to CARDS are a real issue for firms,” stating that’s FINRA has created a CARDS “pilot” and is talking to BDs about the “real, bottom-line impact” it may have on their firms.

CARDS would be a rule-based program that would allow FINRA to collect — on a standardized, automated and regular basis — account information, as well as account activity and security identification information that a firm maintains as part of its books and records.

CARDS, Ketchum said during his remarks, “will allow us to collect and manage data from firms in such a way that we can quickly identify trends and product concentrations that are harmful to investors and take swift, responsive action.”

The automated system would gather data from broker-dealers and clearing firms that the regulator can then use to spot potential problems with sales practices of individual BDs, branches and reps prior to onsite FINRA exams.

Indeed, Hardeep Walia, co-founder and CEO of Motif Investing and a member of both FINRA's Small-Firm Advisory Board and its Technology Advisory Committee, noted on a compliance panel after Ketchum’s speech that “there’s a lot of good that can come out of CARDS,” adding that “the power of CARDS is that it’s the next generation of regulation, which is technology.”

If “we can get it right and get safeguards around it, it will be the next-gen form of regulation” that other regulators can look to, he said.

Michelle Oroschakoff, chief risk officer of LPL Financial, noted on a separate panel on the top 10 regulatory issues that "if done right," CARDS "is going to be terrific" for the markets and for investors, allowing "more targeted [exam] sweeps." However, she said that advisors were already getting questions from their clients about CARDS regarding data privacy issues and that the "investing public is not as supportive of" CARDS as may have been thought. /* .premium-promo { border: 1px solid #ddd; padding: 10px; margin: 0 10px 10px 0; width: 200px; float: left; } .premium-promo li, .premium-promo ul { list-style-type: none; margin: 0; padding: 0; } .premium-promo li { margin: 0 0 10px; padding: 0 0 10px; border-bottom: 1px dotted #ddd; } .premium-promo h3 { text-transform: uppercase; font-size: 11px; } .premium-promo h4 { font-size: 16px; } .premium-promo a { text-decoration: none !important; } .premium-promo .btn { background: #0069a1; border-radius: 4px; display: inline-block; padding: 5px 10px; clear: both; color: #fff; font-weight: bold; } .premium-promo .btn:hover { background: #034c92; } */ BDs’ feedback has already changed the original CARDS plan, which was issued as a concept release.

After pushback, FINRA said in early March that it would modify its original approach by not collecting sensitive personally identifying information (PII) from the data it receives from CARDS, a point that Ketchum noted during his Monday remarks.

“We clarified that PII is not part of the proposal, so CARDS data will not include account names, addresses, tax IDs or Social Security numbers,” Ketchum said. “Thus, customer accounts will not be linked across firms. We know that CARDS will be effective without collecting this information.”

Ketchum said that the self-regulator has also heard BDs' concerns about the security “of such a large database.” However, Ketchum said that FINRA believes the security risk “is very low — and dispute[s] that CARDS could create systemic risk.”

Given that FINRA will not be collecting personally identifiable information, he said, “the chance that anyone could exploit what is, in effect, anonymous data for nefarious purposes is very small.”

But Paul Tolley, chief compliance officer of Commonwealth Financial Network, noted on a panel discussion about the top 10 regulatory issues that he's "not a fan" of CARDS, particularly due to its "privacy" concerns. "The sheer volume" of data in "such a huge database," if breached, could be a problem, he said. "There are some pretty sophisticated systems that have been breached," noting that such a breach of CARDS could spark market manipulation.

CARDS will also be launched “in stages,” Ketchum said, and the CARDS plan has been changed to allow firms to choose how they send data to FINRA. “You can send it to us through a clearing firm, you can send it to us through a service bureau or you can send it to us directly," he said. "It’s up to you.”

Firms raised concerns about having to send the data through clearing firms, with many BDs worrying about “the cost implications of working with a clearing firm, especially since nearly 2,000 firms don’t currently have clearing firm relationships,” Ketchum said.

While FINRA will provide firms with a “standardized file specification” for transmitting data, FINRA plans to permit “variability in the format of data related to suitability,” Ketchum said, which “stems from comments that introducing firms, in particular, use different terminology with respect to information about their customers.”

To address concerns about “direct business data and how the clearing firms would handle that data,” Ketchum noted that “in its initial phases, CARDS will not require firms to submit information about products not held at the firm,” such as variable annuities, direct participation programs and direct mutual funds. /* .premium-promo { border: 1px solid #ddd; padding: 10px; margin: 0 10px 10px 0; width: 200px; float: left; } .premium-promo li, .premium-promo ul { list-style-type: none; margin: 0; padding: 0; } .premium-promo li { margin: 0 0 10px; padding: 0 0 10px; border-bottom: 1px dotted #ddd; } .premium-promo h3 { text-transform: uppercase; font-size: 11px; } .premium-promo h4 { font-size: 16px; } .premium-promo a { text-decoration: none !important; } .premium-promo .btn { background: #0069a1; border-radius: 4px; display: inline-block; padding: 5px 10px; clear: both; color: #fff; font-weight: bold; } .premium-promo .btn:hover { background: #034c92; } */ In a later phase, however, Ketchum said that FINRA “may collect this kind of product information through CARDS, but that collection would be pursuant to additional rulemaking — which would provide us with ample opportunity to continue our dialogue and arrive at workable solutions.”

Ketchum also addressed the question of why FINRA doesn’t first tackle implementing the consolidated audit trail (CAT) before CARDS.

The short answer, Ketchum said: “Unlike CARDS, CAT will not contain the kind of critical information about customer risk appetites, investment objectives, cash movements, margin requirements and position data that we need for our sales practice reviews,” he said. “Moreover, CAT needs to function on a near real-time basis. CARDS does not. To have it do so would be light years more costly than our current proposal.”

A Map to Turn Fear into Profit

Last Monday, I shared a chart with Money Map Report subscribers and suggested they may want to batten down the hatches because I saw a 30- to 40-point drop happening by the end of the week.

Now I want to share that same chart with you plus a new one - and encourage you to do the same thing.

The shellacking the markets took last Thursday is the most powerful warning sign we've seen yet that things are not what they seem in the financial markets. For lack of a better term, it's a bearish omen, despite Monday's recovery.

Today I want to talk about what that means for your money and what you can do about it in the name of protecting your money and, more importantly, the pursuit of profits.

Contrary to what you might believe, not all bears are bad news.

Let's start with the chart....

The Real Reason Black Monday Still Resonates So Clearly

I find the old adage that a picture is worth a thousand words is really true, especially when you look carefully at market charts over widely disparate time frames. That's because you can easily see similarities that are otherwise not apparent.

This helps you prepare ahead of time for contingencies that others will not see until it's too late.

For example, many people have convinced themselves that things are different today in our post-financial crisis world. They cite everything from the "brave new world" we live in to the "rapidly changing technology" and even the Fed's "innovative financial policies" as rationale. Things, they say, are different this time.

So why is it that today's bull market is eerily similar to another famous bull market? And why are traders worried that we'll have a repeat of Black Monday in 1987 a month from now?

Short version... because the charts point to very similar dynamics over almost identical time frames.

Even if investors don't recall the data, they recall the angst from Black Monday 27 years ago.

Psychologists say this is because of the way the amygdala works. That's the part of the brain that activates in response to emotionally charged circumstances, especially those that provoke fear.

I think it's simply the collective knowledge of one generation being passed involuntarily to the next as part of a critical survival instinct, which is why even those who were not investing then feel the fear now.

To draw a parallel, saber-toothed tigers haven't existed for more than 12,000 years. Yet, the thought of them prowling around still causes an involuntary reaction, not to mention a totally irrational "grab-your-spear-and-run-for-the-cave" reaction in most people.

The bull market that started in March 2009 is now up 169% through Friday. That's nearly step for step with the rally that began in 1982 and immediately before the biggest single-day drop in market history on Oct. 19, 1987 - a day we now refer to as "Black Monday."

Many technicians, myself included, are concerned that we could have a repeat 30 days from now.

A Tempered View of a Correction

Marc Faber, who publishes the Gloom, Boom and Doom Report, took it up a notch after last Thursday's trading, saying that he thinks stocks will "drop by 20% to 30% in the near future." With guys like that out there, who needs saber-toothed tigers?!

Anyway, don't let that put you off track. While another Black Monday is theoretically possible, the far more probable scenario is a market correction of 5% to 10%. And that's not a bad thing.

It's long overdue and would be a welcome sign that things are, in fact, working normally. People forget that nothing goes up forever. Markets have to buy and sell for there to be price discovery. Up and down is part of the process. That's why Monday's rally is only part of the story.

If you look at a chart of the S&P 500, a correction like what I am suggesting points to a drop from roughly 1850, where we are now, to approximately 1757, should we get it.

It's worth noting that in order to arrive there, the markets would have to take out key support at 1820ish before coming into contact with the 200-day moving average that, not coincidentally, is farther below.

Will we get there?

I have no idea. Nobody does. But I do know that many of the computers that account for 70% or more of the overall trading volume on today's exchanges are programmed to sell when the markets break below key support levels. Until that happens, the volatility we are experiencing right now is just statistical noise.

If this gives you pause, take a deep breath.

We have talked many times about how and why market volatility creates tremendous opportunity. I know it's not comfortable, but that's your amygdala talking again.

Logically speaking, a sizeable correction is long overdue and should be celebrated because the business cases behind many of the best companies remain intact and completely unaffected by how the stock markets move. It's your chance to buy a $50 steak at Peter Luger's in NYC at a substantial discount.

I can think of any number of reasons why.

For instance, productivity is hitting all-time highs because of technology and innovation. Businesses are cash flush with trillions of cash being put to work. Interest rates remain low - albeit totally for artificial reasons thanks to the Fed, but low nonetheless.

And globalization continues, with the benefits flowing right to the bottom line on some 60+% of the S&P 500, while also charging into economies growing at 6% to 8% a year. Those same economies are where some 75% of the world's population lives today.

Your Specific Profit Plan

Here's what I want you to do today:

Double-check your trailing stops. If the markets do continue to fall, chances are you're going to have the opportunity to capture plenty of profits just like Money Map Report subscribers have in the past. You are using them... right? (If not, click here to find out about getting a copy of the Money Map Method, where I share how to maximize profits and minimize losses using them.) If the markets continue to rise, you're going to go along for the ride and you just raise your stops to ensure you capture even larger profits, which is, after all, kinda the point. Add an inverse fund to your portfolio right now. My favorites include the Rydex Series Trust Inverse S&P 500 Strategy Fund Class Investor (MUTF: RYURX) fund or the ProShares Short S&P 500 (NYSE ARCA: SH). Both appreciate as the S&P 500 falls. Studies show that 3% to 5% of overall investable assets can provide some substantial reinforcement for your portfolio, not to mention some healthy profits, too. Get your buy list ready. If you wanted to buy Tesla Motors Inc. (Nasdaq: TSLA) at $150 or Amazon.com Inc. (Nasdaq: AMZN) at $250, you just may get your chance. Other companies may be similarly discounted - and I'll be back in subsequent columns with some names and ideas I hope you find helpful.

No investor has to suffer the ravages of a bear market if they're properly prepared.

Best regards for great investing,

Keith

This Tech Sector About to See Explosive Growth?

Related HPQ Morgan Stanley Keeps Overweight Rating, $34 Target on HP Amid Earnings Top Trending Tickers On StockTwits For February 21

The 3D-printing sector may be currently in an impasse but trust me folks, when I say the sector will be significant going forward and a buying opportunity as the price of the 3D-printing machines fall. My stock analysis is that 3D printers will become a common sight on the desk of many homes.

Recall what happened when the laser printer first debuted in May 1984 with Hewlett-Packard Company’s (NYSE: HPQ) desktop laser printer. The initial cost was staggeringly high at more than $3,000, but now a laser printer sells for less than $100.00. The same thing will happen for the 3D printer as prices start to decline, based on my stock analysis.

Also Read: NYSE holidays 2014

As my stock analysis indicates, 3D-printing technology will be a big winner going forward in nearly every area, from manufacturing to medical devices and technology.

The size of the 3D-printing and associated services market could jump to more than $6.0 billion by 2018, according to Citibank analyst Kenneth Wong. (Source: “3D Printing Market to Triple by 2018,” Business Wire, August 27, 2013.) As Wong notes, the catalyst for the growth will begin with the expiration of key patents in 2014 that will drive prices lower.

Even athletic shoemaker New Balance is using the 3D-printing technology to produce customized shoes for elite athletes. (Source: “New Balance Pushes the Limits of Innovation with 3D Printing,” New Balance web site, March 7, 2013.) I expect the 3D service will eventually be available for everyday purchases once 3D-printing machines become more readily available.

At this point into the race, my stock analysis suggests that the leaders in this sector are Stratasys Ltd. (NASDAQ: SSYS), with a market cap of about $6.24 billion, and 3D Systems Corporation (NYSE: DDD), with a market cap of about $7.99 billion.

On the small-cap side, an interesting stock to watch and keep an eye on is Friedberg, Germany-based voxeljet AG (NASDAQ: VJET), which has a $349-million market cap, as my stock analysis indicates.

Voxeljet made its initial public offering (IPO) debut on October 18, 2013 at $20.00 and surged to $70.00 on November 18, but it has not been an easy ride since, with the stock price falling to its current level around $34.00.

The company makes high-speed, large-format 3D printers and on-demand parts services geared for industrial and commercial customers. The move to the retail market is not there yet, but my stock analysis suggests that it will only be a matter of time before this occurs.

The valuation is extreme at this time, trading at 388X its estimated 2014 earnings per share (EPS), but the stock must be analyzed as far as its potential and not its valuation, according to my stock analysis.

Based on my stock analysis, Voxeljet has what it takes to deliver.

Annual revenues increased from $4.76 million in 2010 to $8.71 million in 2012. For 2014, the revenue growth is estimated at 57.2% to $24.4 million, according to Thomson Financial.

Voxeljet has been in the red, but it is predicted to make $0.01 per diluted share in 2013 and $0.09 per diluted share in 2014, according to the Thomson Financial estimates.

For Voxeljet, it’s all about the future, when 3D printers become a mainstay in the homes of everyday users, based on my stock analysis.

This article This Tech Sector About to See Explosive Growth? was originally published at Daily Gains Letter

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Markets Tech Trading Ideas

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4 Big Stocks on Traders' Radars

BALTIMORE (Stockpickr) -- Put down the 10-K filings and the stock screeners. It's time to take a break from the traditional methods of generating investment ideas. Instead, let the crowd do it for you.

>>5 Hated Earnings Stocks You Should Love

From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.

Crowdsourcing has long been a popular tool for the advertising industry, but it also makes a lot of sense as an investment tool. After all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.

While some fund managers are already trying to leverage social media resources like Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for investors who want a starting point in their analysis. Today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market today.

>>Where's the S&P Headed From Here? Higher!

These "most active" names are the most heavily-traded names on the market -- and often, uber-active names have some sort of a technical or fundamental catalyst driving investors' attention on shares. That's especially true now that earnings season is officially underway. And when there's a big catalyst, there's often a trading opportunity.

Without further ado, here's a look at today's stocks.

Ford

Nearest Resistance: $15

Nearest Support: $13

Catalyst: January Sales Miss

>>5 Rocket Stocks to Buy in February

Shares of Detroit automaker Ford (F) are off more than 3% on high volume this afternoon, the reaction from a January sales miss that registered 7% lower vs. last year's particularly strong reading. Ford attributed the miss to inclement weather in the brand's biggest sales regions.

One silver lining came from Lincoln, the premium brand that's been struggling to find its way in recent years. Lincoln saw its strongest sales in four years.

Still, Ford looks bearish overall today. More significantly, today's 3% selloff is pushing shares through an important support level at $15. With buyers unable to keep up with supply of shares at that level, look out below for more downside in Ford in February.

AT&T

Nearest Resistance: $33.50

Nearest Support: $32.25

Catalyst: Price Cuts

>>5 Big Trades to Profit During the Fed's QE Pay Cut

Telecom giant AT&T (T) is another name that's down more than 3% this afternoon, in this case because of an escalating war between the firm and its ultra-competitive rivals. AT&T announced that it was cutting the monthly fee for family data plans on Saturday, a move that could spur rival carriers into reacting with cuts in kind. While the move was designed to retain customers amid commoditized service offerings, it's also going to negatively impact AT&T's margins in 2014.

The technical story in AT&T isn't far off from Ford's setup. Shares of T are testing a key support level at $32.35 in today's session, a support level that, if broken, spells a lot more downside ahead. AT&T's chart has been broken for a while now, but it's getting worse. Don't buy the dip in this communications giant.

Radio Shack

Nearest Resistance: $2.70

Nearest Support: $2.40

Catalyst: Super Bowl Ad

Electronics retailer Radio Shack (RSH) is moving higher on abnormal volume after -- of all things -- a funny Super Bowl ad. I wish I were making that up. Indeed, RSH is more than 4% higher on today's session thanks to the ad, which lampooned the store for its '80s vibes -- and reintroduced the new Radio Shack store concept.

Part of the move higher this afternoon comes from a stock that started off with pretty attractive technicals to begin with. RSH has been looking "bottomy" lately, with an inverse head and shoulders setup forming in shares since December. The buy signal comes on a push through the $2.70 level.

Verizon

Nearest Resistance: $47

Nearest Support: $45.50

Catalyst: AT&T Price Cuts

>>5 Stocks With Big Insider Buying

Last up is Verizon (VZ), a name that's off 2.7% this afternoon because of AT&T's decision to cut prices. Investors are selling shares on fears that AT&T just ignited a race to the bottom on data charges, a change that would be great for consumers -- and horrific for VZ's bottom line. Whatever the outcome, Verizon's technical story looks sketchy right now.

Shares are pushing through support at $47 this afternoon. If the breakdown holds into today's close, the next-closest support level is down at $45.50. It makes sense to stay away from VZ unless it can catch some semblance of support again.

To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.



-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:

>>3 Stocks Spiking on Unusual Volume

>>5 Short-Squeeze Stocks That Could Pop in February

>>2 Stocks Under $10 Moving Higher

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to

TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji

Cisco Systems, Inc. (NASDAQ:CSCO): What Cisco May Add To Next-Gen UCS?

The year 2014 could be significant for Cisco Systems, Inc. (NASDAQ:CSCO), particularly for its unified computing system (UCS) business.

Cisco Unified Computing System (UCS) is a x86 architecture data-center server platform. It unifies computing, networking, management, virtualization, and storage access into a single integrated architecture.

The unique architecture enables end-to-end server visibility, management, and control in both bare metal and virtual environments and facilitates the move to cloud computing and IT-as-a-Service with Fabric-Based Infrastructure.

It seems that the Cisco's UCS plan for next year will include an expansion of the Whiptail Flash storage acquisition to integrate Hard Disk Drives (HDD) for application data capacity (implying a mix use of Flash and Disk). Cisco expects Data Center/UCS business to grow 20-25 percent over the next 3-5 years.

[Related -Cisco Systems, Inc. (CSCO) Dividend Stock Analysis]

Sterne Agee analyst Alex Kurtz views that the potential HDD addition is a likely sign of Cisco's move deeper into Tier 0/1workloads and positive for its Total Addressable Market (TAM), which over time could create tension with existing partners like EMC Corporation (NYSE:EMC) and NetApp Inc. (NASDAQ:NTAP).

[Related -Cisco CSCO Shares Shatters Support Into Open Air Pocket]

With the $415 million acquisition of Flash storage vendor Whiptail in October, Cisco has indicated its intent to capture storage dollars among Tier 0/1 workloads. At its recent analyst day, Cisco was increasingly focusing on the Business Intelligence/Analytics market with UCS, indicating the potential addition of Hard Disk Drive capacity as part of the UCS evolution.

Cisco positioning would likely remain focused on high Input/Output (IO) driven applications with this new UCS platform and would not represent a push into the broader storage market. Yet, the presence of HDDs would suggest the intent to capture larger pools of application data.

Kurtz said the high-end IO intensive Storage market is potentially 10-15 percent of the overall $26 billion Networked Storage market. He views this as an incremental opportunity for Cisco's Data Center practice (5 percent of revenue but a key longer-term growth driver).

Cisco needs a more integrated selling approach than the company has had to execute against historically (sell to both Business Intelligence/Analytic admins as well as the Compute/Storage team - often separate groups that have siloed relationships with EMC, NetApp, Oracle and SAP).

Cisco's potential moves would mean a complex set of scenarios for EMC and NetApp, dependent on the extent of HDD capacity in the UCS chassis. It would be closely watched how Cisco's potential platform would work extensively outside bare metal environments.

Kurtz said there would be some friction EMC over the next several years against XtremIO in the All Flash Array market. NetApp's FlashRay has yet to reach general availability in 2014, but he suspects some potential overlap here, as well.

Moreover, the introduction of HDD capacity into UCS could also complicate a longstanding market thesis of Cisco acquiring NetApp.

Meanwhile, how this (UCS+HDD) integrates, if at all, into virtualized environments compared to bare metal remains a key outstanding question. California-based Cisco makes Internet Protocol (IP) networking and other products to the communications and IT industry worldwide. Shares of Cisco have gained about 8 percent in the last one year.

IIHS names 22 cars as Top Safety Pick Plus

Just when it looked like every new car on the road would earn the Insurance Institute for Highway Safety's Top Safety Pick Plus designation, the rules get changed and the winners are winnowed down considerably.

Only 22 models now earn the IIHS' top award, coveted enough that it shows up endlessly in car advertising. To have won it, cars not only had to ace front, side, head restraint and roof crash tests, but the "small overlap crash test," which simulates crashing into a pole on the driver's side of the car.

That last test has been bedeviling automakers since it was introduced. Cars that had been on recommended lists for years suddenly found themselves failing. Automakers scrambled and make sure they could pass. Hence, Consumer Reports magazine today restores Toyota Corolla to its recommended list now that it passes the IIHS tests.

"We've made it more difficult for manufacturers this year," says IIHS President Adrian Lund in a statement. "Following a gradual

phase-in, the small overlap crash is now part of our basic battery of tests, and good or acceptable performance should

be part of every vehicle's safety credentials."

Those passing all the test include:

Honda Civic hybridMazda3 built after October 2013Toyota Prius built after November 2013Ford FusionChrysler 200Honda Accord 2-doorHonda Accord 4-doorMazda6Subaru LegacySubaru OutbackInfiniti Q50Lincoln MKZVolvo S60Volvo S80Mazda CX-5 built after October 2013Mitsubishi OutlanderSubaru ForesterToyota HighlanderAcura MDXMercedes-Benz M-Class built after August 2013Volvo XC60Honda Odyssey

Do Financial Advisors Follow Their Own Advice?

By Hal M. Bundrick

NEW YORK (MainStreet) � Ever wonder if financial advisors follow their own advice? They urge you to plan for the future, invest wisely and save for retirement. But turn the tables and you'll find over two thirds (67%) of these money pros don't have a succession plan in place for their very own business, according to research by Fidelity Institutional Wealth Services.

With the average age of financial advisors being 52, that's a problem.

"While there is no substitute for comprehensive succession planning, we recognize that for many [investment] firm leaders, this longer-term planning is a process that requires time," said David Canter, executive vice president and head of practice management and consulting at Fidelity Institutional Wealth Services. "Yet there's a need for advisors to put back-up measures in place immediately. We encourage advisors to establish business continuity plans � even before their succession plans � so they know their clients and their business are taken care of in case of an emergency." Depending on an advisor to manage your financial assets, and then finding out that there was no succession plan in place can leave clients in the lurch. Consumers and small business owners can take a tip from this advisor neglect and form a succession plan for their own family or business. Fidelity offers these tips: Limited Power of Attorney � This document outlines a temporary plan if something happens to you or your business, ensuring that it can continue to operate and generate revenue. Buy-Sell Agreement � Every small business should have a plan in place specifying who will take the reins if the owner is permanently disabled or passes away. A buy-sell agreement helps to define a businesses' valuation, payment of the purchase price and closing terms. Operating/Shareholders Agreement Review � Family businesses especially need agreements that include provisions addressing both the temporary and permanent unavailability of one or more partners or principals. "We have found that prudent business continuity planning creates a logical bridge to begin the dialogue on succession planning," said Brian Hamburger, president of MarketCounsel, a consulting firm for investment advisors. "Looking at the issue from a practical scenario, the unavailability or sudden loss of key personnel makes the issue real." Hamburger says effective succession planning is becoming even more critical to ensuring current business owners hand over control to others in a way that is least disruptive to their firm's operations, clients and long-term value. That's a good lesson for advisors, as well as all business owners. Fidelity offers six steps to help lead to a successful business transition: 1) value your firm 2) establish goals and determine timelines 3) assess potential buyers 4) evaluate different deal structure options 5) address governance issues 6) document your businesses' succession plan --Written by Hal M. Bundrick for MainStreet

Move Here for Lower Health Care Insurance Premiums

By Hal M. Bundrick

NEW YORK (MainStreet)�When it comes to the cost of healthcare, we'll take good news wherever we can find it. And while this update is not worthy of a "breaking news" graphic, Aon Hewitt says health care insurance premium rate increases are at their lowest in more than a decade.

So yes, premium rates are still going up, just not quite as quickly.

The average health care premium rate increase for large employers in 2013 was 3.3%, down from 4.9% in 2012 and 8.5% in 2011. In 2014, however, average health care premium increases are projected to bounce back to the 6% to 7% range. "There are many factors that contributed to the lower rate of premium increases we saw over the past two years that we don't expect to continue in the long-term," says Tim Nimmer, chief health care actuary at Aon Hewitt. "These include the lagged effect from the economic recession on health care spending and continued adjustments as employers and insurers phase out the conservatism that was reflected in earlier premiums due to uncertainty around economic conditions and health care reform. Additionally, employers and insurers will now be subject to new transitional reinsurance fees and health insurance industry fees. While we are seeing pockets of promising innovation in the health care industry, we expect to see 2014 premium increases shift back towards the 6% to 7% range overall." And now the bad news   But of course, there is bad news. The money out of your pocket -- for copayments, coinsurance and deductibles -- increased 12.8% ($2,239) in 2013, compared to a 6.2% bump in 2012.   The analysis reports the average health care cost per employee was $10,471 in 2013. That is expected to rise to $11,176 per employee next year. To put the rising costs in perspective, over the last decade your share of health care expenses -- including employee contributions and out-of-pocket costs -- will have increased almost 150%. Where you live matters In 2013, major U.S. markets that experienced rate increases higher than the national average included Los Angeles (6.9%), Orange County (6.9%), Washington DC (5.3%) and San Francisco/Oakland/San Jose (4.8%). Meanwhile, New York City (1.6%), Milwaukee (2.1%) and Atlanta (2.4%) experienced lower-than-average rate increases in 2013. Can you learn to like cold weather? Minneapolis actually saw a decrease in health care insurance premiums, at -0.1%. --Written by Hal M. Bundrick for MainStreet

Tough Times For Intel Earnings Never Looked Better

Intel Corp. (NASDAQ: INTC) reported its third quarter earnings on Tuesday after the market close, and the set-up for earnings was that the sales would be dragged lower by a lack of PC sales. In short, processors for computers are not where the current trends are. So why is that even with caution that the stock is being so well received.

Earnings came in at $0.58 per share on revenue of $13.48 billion for the quarter. Where things are doing well is that Thomson Reuters was calling for a mere $0.53 EPS on sales of $13.46 billion in revenue. Intel did manage to keep sales flat from a year ago, and they were actually up 5% sequentially. That translates to earnings of about $3 billion, and gross margin was still shockingly high at 62.4%.

Intel called it a quarter of modest growth in a tough environment, The company also guided the following quarter to have margins at 61% and sales of $13.7 billion, plus or minus Intel’s usual couple of percentage points fudge room in either direction and a $500 plus and minus range on sales. We would point out that Intel’s sales for the fourth quarter of 2012 were $13.477 billion, so Intel could actually post year-over-year growth if things in Washington D.C. do not become too out of hand in the coming days or weeks. When things were dire in the past at Intel the guidance was for much more significant caution around future sales.

The PC client sales came in at $8.4 billion (up 3.5 percent sequentially and down 3.5 percent year-over-year) and the data center group sales came in at $2.9 billion (up 6.2 percent sequentially and up 12.2 percent year-over-year). Where Intel is starting to make strides is that over 40 22nm products have been introduced for the ultra-mobile device, networking, storage, and server market segments. This is what has to drive Intel shares much higher, maybe even to $28 to $30 or much higher.

Intel shares closed down 6-cents at $23.39 against a 52-week range of $19.23 to $25.98, and shares were indicated higher by about 1.5% at $23.75 shortly after the earnings report in the after-hours trading session on Tuesday.

If you just listened to Apple lovers and smartphone and tablet users you might think Intel has a questionable future. If you consider that Intel’s rough patches have been there before, things sure seem great in reality versus such a tough perception.

Adviser capping firm's annual fees, saying larger clients paying too much

A small Nebraska financial advisory firm is unveiling a novel approach to attracting its target clients by capping its annual adviser fee at $11,000.

Phil Wood's Wealth Partners Inc. has launched a new division that charges clients 1.25% on assets up to that annual total. As a result, management of investments totaling more than about $880,000 will be on the house. The firm, which manages about $170 million in assets, eventually will move all its clients to its One Price Portfolio division, Mr. Wood said.

“Clients with larger accounts have been paying an unfair share,” he said. “The time involved to manage a large portfolio isn't that much greater than a small one.”

Technology developments, specifically the portfolio management software the firm uses from its broker-dealer, SII Investments Inc., make the investment management tasks similar among all his clients, Mr. Wood said. Clients will still pay additional charges for financial plans and other services.

See Also: How to raise fees without ticking off clients

The advisory fee for one client with $1.5 million in assets, for example, would fall from about $15,000 a year to $11,000 under this new pricing plan. The firm's target clients have portfolios between $1 million and $5 million.

Annual percentage-based fees typically decline as the client's asset total grows — a pricing plan long considered a way to compensate advisers for growing account values but also a nod toward the conclusion that it doesn't necessarily cost more to manage portfolios of a greater size.

John Anderson, head of practice management for SEI Advisor Network, praised the firm's new fee transparency. He said that even if clients aren't asking an adviser about the amount they charge, they are thinking about whether it really costs $10,000 more to manage a $2 million portfolio, versus one of $1 million.

“Advisers often set minimum fees but rarely have been capping their fees,” Mr. Anderson said. “It's a phenomenal idea.”

Such a cap might not work for larger accounts, such as $10 million and over, because those would likely require more complicated investments, such as in alternatives, and more due diligence, Mr. Anderson said. Of course, advisers also have greater liability as the amount of assets they manage climbs, he said.

Mr. Wood said that industrywide, he doesn't believe that clients are aware of what they pay each year just to compensate their adviser, and he's hoping to change that, too.

A calculator at OnePricePortfolio.com allows users to add their portfolio balance sum, and using industry averages, it estimates the financial adviser fee the user is paying. It lists those in compa! rison with what the person would pay using their capped-fee structure.

“If people knew what they were paying to their current adviser, they would be interested in changing,” said Mr. Wood, who hopes One Price Portfolio will lead to many client referrals from existing and new clients.

He expects to serve clients mostly online or over the phone, enabling the firm to expand its national reach versus its current clients, who are mostly from or live in Nebraska.

The Interesting Value ETF You Don't Know

NEW YORK (TheStreet) -- This past spring First Trust restructured its Strategic Value Index Fund and renamed it the First Trust Capital Strength ETF (FTCS).

The new fund falls into the "smart beta" category I have written about recently. Such funds use custom screens to select components from broad-based indices in an effort to outperform their benchmarks. [Read: Investment Ideas From Day 1 of the NY Value Investing Congress]

FTCS starts by identifying the 500 largest U.S. stocks that have at least $5 million in daily trading volume. The ETF screens those 500 stocks to find the ones with at least $1 billion in cash or short-term investments, a ratio of market cap to long-term debt of less than 30% and a return on equity greater than 15%. From there, it scores the stocks for volatility, and the fund purchases equal amounts of the 50 stocks that have the lowest volatility.

FTCS also has rules to avoid being overly concentrated in any single sector, capping exposure at 30%. The index is reconstituted quarterly. The current sector makeup favors industrials, at 20%, followed by consumer services at 19%, health care at 17%, consumer goods at 17% and tech at 10%. The fund has no exposure to utilities or telecom. Omitting those two sectors is logical because they tend to be very debt-heavy. FTCS is oriented toward large-cap stocks, so most of the names in the fund should be familiar to you, such as MasterCard (MA), Qualcomm (QCOM) and Nike (NKE). Interestingly, defense contractors make up 8% of the fund, which could smooth out the ride for FTCS if the situation in Syria escalates into a situation that is bad for the markets in general but good for defense stocks. First Trust has said that it converted its more traditional large-cap value fund into the Capital Strength fund after realizing that many investors are concerned about how fast the market has gone up in recent years and worried that the fundamentals do not necessarily support the big rally. [Read: 5 Breakout Trades to Take Ahead of the Fed] First Trust says that companies with the attributes identified by FTCS will better weather a large downturn or a period of increased volatility because those companies have more options with their cash and less financial risk because of their low debt.

Although First Trust hasn't said as much, it's also possible that it made the conversion after deciding that the original fund's lack of assets -- $37 million -- indicated the market didn't need another basic large-cap value fund.

Although the capital strength process yields a value tilt, it is not a carbon copy of other large-cap value funds offered by competitors.

The iShares S&P 500 Value ETF (IVE), the Power Shares Dynamic Large Cap Value Portfolio (PWV) and the Vanguard Mega Cap Value ETF (MGV) all have weightings greater than 20% in the financial sector compared to just 8% for FTCS. The other funds have much less exposure to the industrial sector than FTCS. [Read: Ex-JPMorgan Traders Could Face 20 Years in Prison]

Since FTCS started trading in its current incarnation these differences have not mattered because all four of these funds have traded in lockstep. Historically the industrial sector tends to decline more than the broad market during the bear phase of the cycle and then bounces back more than the broad market in new bull markets. Although First Trust seeks to offer a fund that is more resilient to bear market declines, the fund may not in fact do that if it still has its heaviest weighting in the industrial sector when the next large decline comes. At the time of publication, Nusbaum had no positions in securities mentioned. Follow @randomroger This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

This contributor reads: Credit Writedowns Pragmatic Capitalist Mike Shedlock Barry Ritholtz John Hussman On Twitter, this contributor follows: TheStalwart ETF Database zerohedge financial acrobat

Green Technology Solutions, Inc. & Partners Prepare for Bolivian Expansion (OTCBB:GTSO)

Green Technology Solutions, Inc. (GTSO)

Today, GTSO has shed (-10.51%) -0.0041 at $.0349 with 1,304,937 shares in play thus far (ref. google finance Delayed: 2:03PM EDT August 13, 2013).

Green Technology Solutions, Inc. and its partner, Chilerecicla, are preparing to expand recycling operations into Bolivia.

One of South America's top recyclers of e-waste, Chilerecicla operates the first e-waste recycling plant in Southern Chile and maintains crucial relationships with overseas smelters, with the right to sell them as many recovered metals and minerals as GTSO and Chilerecicla can provide. With a feasibility study on the region now complete, the joint venture has targeted Bolivia as an ideal territory for growth.

Green Technology Solutions, Inc. (GTSO) 5 day chart:

Investing in equities

If equities tempt you but you are scared to take the plunge during these volatile times, here's a complete step-by-step guide on investing in equities.

Step 1: Understand how the stock market works

When you read you begin with A-B-C. When you sing you begin with Do-Re-Mi. And when you invest in stocks you begin with business-company-shares.

Before you embark on your journey to invest in equities, teach yourself how the stock market works. Read this easy guide .

Step 2: Learn how to choose a stock
Having understood the markets, it is important to know how to go about selecting a company, a stock and the right price. A little bit of research, some smart diversification and proper monitoring will ensure that things seldom go wrong.

It's not that difficult: Just follow these 4 golden rules. And while you are at it< why don't you also check out How to buy low, sell high.

Step 3: Decide how much to invest
Since equities are high risk, high return instruments, how much you should invest would really depend on how much risk you can tolerate.

Once you have done that, use this asset allocation test to calculate exactly how much of your savings you should invest in equities.

Step 4: Monitor and review
Monitoring your equity investments regularly is recommended. Keep in touch with the quarterly-results announcements and update the prices on your portfolio worksheet atleast once a week. You can use Moneycontrol's Portfolio to update the prices of your equity holdings.

Also, review the reasons you earlier identified for buying a stock and check whether they are still valid or there have been significant changes in your earlier assumptions and expectations. And use an annual review process to review your exposure to equity shares within your overall asset allocation and rebalance, if necessary. Ideally, revisit the RiskAnalyser at every such review because your risk capacity and risk profile could have undergone a change over a 12-month period.

Finally, ensure that you avoid these seven most common investing mistakes and sail smoothly into your financial bright future.

Photograph: Jun Kokimura/Getty

Disclaimer: While we have made efforts to ensure the accuracy of our content (consisting of articles and information), neither this website nor the author shall be held responsible for any losses/ incidents suffered by people accessing, using or is supplied with the content.

TRW Automotive Attains 52-Week High - Analyst Blog

Shares of TRW Automotive Holdings Corp. (TRW) hit new 52-week high of $68.93 on Jul 5, which is above its previous level of $68.38, and closed at $68.73 on the same day. The closing price represented a strong one-year return of 81.4% and year-to-date return of 25.0%.

TRW Automotive, headquartered in Michigan, is a leading manufacturer of advanced technology products and services for the automotive markets. The company operates in 27 countries through its subsidiaries. It has a market cap of $8.3 billion. Average volume of shares traded over the last three months stood at approximately 944.4K.

Shares of the company started escalating due to improving fundamentals in the automotive components supplying market. However, the company failed to impress investors with its first quarter results on Apr 30.

TRW posted earnings of $1.51 per share in the first quarter of 2013, topping the Zacks Consensus Estimate of $1.46. However, earnings fell 6.8% from $1.62 per share in the first quarter of 2012 due to lower operating income on the back of a higher mix of lower margin business and planned increases in costs to support future growth. Net earnings dipped 10.4% to $189 million from $211 million a year ago. All of them excluded special items.

Revenues in the quarter were almost flat at $4.2 billion as the impact of increasing demand for TRW's innovative technologies and higher vehicle production volumes in China were offset by significantly lower vehicle production in Europe.

U.S. auto sales continue to improve driven by continued macroeconomic recovery, aging vehicles on the U.S. roads and strong demand for commercial vehicles from businesses. Seasonally adjusted annual sales rate in June this year reached its highest level of 15.9 million units since November 2007.

Currently, shares of TRW retain a Zacks Rank #3, which translates to a short-term rating (1–3 months) of Hold. Some other stocks that are performing well in the industry include Visteon Corp. (VC! ) and Magna International Inc. (MGA), each with a Zacks Rank #1 (Strong Buy), and Meritor Inc. (MTOR) with a Zacks Rank #2 (Buy).

2 Health Care Stocks Rising on Big Volume

DELAFIELD, Wis. ( Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

With that in mind, let's take a look at several stocks rising on unusual volume today.

TrovaGene

TrovaGene (TROV) is a development stage molecular diagnostic company focused on the development and marketing of urine-based nucleic acid tests for patient/disease screening and monitoring. This stock closed up 6% to $10.02 in Friday's trading session.

Friday's Volume: 712,000

Three-Month Average Volume: 183,106

Volume % Change: 294%

From a technical perspective, TROV ripped higher here into all-time high territory with heavy upside volume. This stock has been uptrending strong for the last month and change, with shares soaring higher from its low of $5.75 to its new all-time high of $10.20. During that move, shares of TROV have been making mostly higher lows and higher highs, which is bullish technical price action. That move has also been accompanied by bullish upside volume flows.

Traders should now look for long-biased trades in TROV as long as it's trending above its recent breakout level of $8.83, and then once it sustains a move or close above its all-time high of $10.20 with volume that hits near or above 183,106 shares. If we get that move soon, then TROV will set up to enter new all-time high territory, which is bullish technical price action. Some possible upside targets off that move are $13 to $15.

Addus HomeCare

Addus HomeCare (ADUS) provides a range of home- and community-based services to older adults and younger disabled individuals in the U.S. This stock closed up 10.16% at $21.46 in Friday's trading session.

Friday's Volume: 273,000

Three-Month Average Volume: 184,047

Volume % Change: 110%

From a technical perspective, ADUS ripped sharply higher here right above some near-term support at $18.58 and back above its 50-day moving average of $19.44 with above-average volume. This move also pushed shares of ADUS into breakout territory, since the stock took out some near-term overhead resistance at $20.94. Shares of ADUS are now starting to trend within range of triggering another major breakout trade. That trade will hit if ADUS manages to take out some resistance at $22 to its 52-week high at $23.71 with high volume.

Traders should now look for long-biased trades in ADUS as long as it's trending above $20.94 or its 50-day at $19.44 and then once it sustains a move or close above those breakout levels with volume that this near or above 184.047 shares. If that breakout triggers soon, then ADUS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $30 to $32.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

The Stark Truth Behind Goldman's Earnings "Beat"

U.S. stocks are roughly unchanged this morning, with the S&P 500 (SNPINDEX: ^GSPC  ) and the narrower, price-weighted Dow Jones Industrial Average (DJINDICES: ^DJI  ) down 0.11% and 0.7%, respectively, as of 10 a.m. EDT. The S&P 500 is shooting for its ninth consecutive "up" day; if it succeeds, it will mark the longest winning streak achieved since November 2004.

Hewlett-Packard's board gets some new blood
Dow component Hewlett-Packard (NYSE: HPQ  ) has just added former Microsoft technologist Ray Ozzie to its board of directors. On the one hand, Ozzie brings exceptional knowledge and experience of the technology industry to HP's board: He founded two software companies that were ultimately bought by industry heavyweights and inherited the role of "chief software architect" at Microsoft from Bill Gates himself. While such expertise is welcome, the real problem with HP's board is that it is rudderless. Meanwhile, Ozzie seems to me too independent and intellectual to fill the leadership gap.

Another bank, another beat
In the wake of the earnings beats by Wells Fargo, JPMorgan, and Citi, Goldman Sachs (NYSE: GS  ) is the latest among the too-big-to-fail set to top expectations. In fact, Goldman blew past the $2.82 consensus earnings-per-share estimate in the second quarter, earning $3.70.

Before we start handing out high-fives, let's keep that performance in perspective. Goldman is doing a decent job at keeping its personnel costs in check: Compensation and benefits eat up 43% of revenue, which is consistent with the first quarter. Nevertheless, this remains an organization run for its employees, not its shareholders. Indeed, for all its vaunted profitability, it's a thin stream of profit that trickles down to the latter group. Goldman's annualized return on average common shareholders' equity was just 10.5% in the second quarter. That's hardly the sort of number that makes investors salivate. In fact, analysts reckon it's barely above the bank's 10% cost of capital.

Besides, with the civil trial of former Goldman banker Fabrice Tourre having started yesterday, Goldman has more pressing concerns regarding another, highly prized form of capital: reputational capital.

Between the questionable business practices and the opaque balance sheets, many investors are understandably hesitant about investing in big banking stocks after the crash, but the sector has one notable standout. In a sea of mismanaged peers, it rises above as "The Only Big Bank Built to Last." You can uncover the top pick that Warren Buffett loves in The Motley Fool's new report. It's free, so click here to access it now.

Amazon Crosses the Gaming Line

Ever since Amazon.com (NASDAQ: AMZN  ) commandeered Google (NASDAQ: GOOG  ) Android for its own purposes, there's been a distinct line in the sand. Amazon has its forked version of Android that has no official association with the search giant or its content stores, while Google has its sanctioned version. Amazon just crossed that line.

The e-tail heavyweight is now expanding its GameCircle service to include all Android devices. GameCircle is Amazon's social gaming network that allows gamers to play each other and offers achievements and leaderboards. Up until now GameCircle had been exclusive to Kindle Fire devices.

By broadening its horizons, Amazon is taking a clear shot at the gaming community within Google's Android camp. Even though both companies operate Android-based ecosystems, this is effectively a move at cross-platform warfare. The search giant just made a similar push in May when it announced Google Play Game Services at Google I/O, which integrates across Android, Apple (NASDAQ: AAPL  ) iOS, and Web platforms. Apple's Game Center, which is only available for iOS, has also grown, to 240 million users.

Google is reportedly building a game console to pre-empt Apple, which may integrate gaming features into its Apple TV. Microsoft easily has an advantage in this department thanks to its popular Xbox 360. The software maker now has 46 million paying Xbox Live members. Those members are likely more engaged with Microsoft's gaming platform than their mobile counterparts.

For instance, Game Center users may be registered since the service is integrated into iOS and many games, but that doesn't mean those users are actually using the free service.

Online social gaming networks are key for multiplayer functionality, and no clear leader has emerged. That's an opportunity for companies looking to strengthen their platforms, and Amazon's expansion is a clear acknowledgement of this fact. That's particularly true considering that the tech giants are preparing to move into the living room, and gaming will be a big part of that.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.