A distinction should be made between investing in one’s own business, The key point about financial investments is that you can choose them, you can sell them, but what you cannot do (unless you are Warren Buffett) is influence their performance.
Obviously, you make an investment with a view to getting a return on it. However, what precisely is a return? It has two components: the market value of the asset and the cash flow from it. The two are intertwined; for example, an older bond with a coupon higher than would be offered by a similar bond today will see its market price go up. In fact, there are quite precise calculations to show this effect, which will be covered in due course. Nevertheless, if you hold a bond to maturity, you know what its value will be at maturity; it will be the par value and it is that which you will get back
Likewise, a share offering a good dividend will be valued, under normal circumstances, more than a share generating as much profit, but not distributing that profit partly by dividend. It must be admitted, however, that some hi-tech companies even boast that they do not distribute dividend as there is so much potential for company growth in the future.
Measuring return when only capital growth is involved is very simple. You take the ratio of the end value to the starting price and take the nth root of that ratio, were n is the number of years that the investment is held.
According to measuring return part, I would say, we need to find out what are the best possible investment choices for our life and devise a workable plan on how to achieve our financial goals; therefore I would prefer to buy shares or bonds which are safer and find out the best ROI, return of investment for me.
Therefore, we need to put everything on the table and keep on mind two main options and compare which way is useful and has good ROI and NPV, as we know the NPV (Net Present Value) does provide the investor with a quick and easy way to determine whether the price that will be paid for the share or bond and even the property will yield the investor's desired rate of return (i.e., discount rate), therefore I moved to the direction of buying shares that issued by known corporate or semi government. As we know the safest type of share the one that considered as semi government share is not because government are particularly responsible, but because they can, in principle, more secure, considered safe investments as the government is unlikely to go bust.
For instance, Dubai Islamic Bank Dubai Islamic Bank (DIB) shares ended 2013 at Dh5.36 each, a gain of 166 per cent. The emirate’s largest Sharia-compliant lender benefitted from a sector-wide increase in lending. DIB increased its shareholding in the property lender Tamweel to close to 90 per cent, paying off its bilateral facilities in September. In December, the bank announced plans to increase the percentage of its share capital available to foreign investors to 25 per cent from 15 per cent. This is in line with other local institutions looking to attract international funds in the run-up to the UAE’s upgrade to emerging-market status.
Other example, Etisalat which is the second most heavily weighted stock on the Abu Dhabi index, accounting for 16.4 per cent of the index’s weight (only First Gulf Bank counts for more, at 27.3 per cent). The telco’s shares surged by 161 per cent during 2013, ending the year at Dh 11.70 each. The operator announced its first overseas acquisition in five years in November, agreeing to pay $5.7bn for Vivendi’s 53 per cent stake in Maroc Telecom after protracted negotiations with the French conglomerate. At home, the introduction of mobile number portability could affect the operator’s subscriber base in 2014.
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