Finance Tips

Spread betting and CFD trading provider City Index (http://www.cityindex.co.uk/) takes a look at the activity affecting the financial markets on 3rd March 2011.

Group external earnings for ITV rose by 185 per cent last year when compared to 2009.

For the year ended December 31st 2010, adjusted earnings per share stood at 6.4 p, a rise from the 1.8 p enjoyed during the previous year.

Following the announcement, share prices of ITV have risen and as of 08:24 GMT this morning (March 3rd), had climbed up by London Stock Exchange by 1.77 per cent when compared to yesterday’s close.

This represents the value of ITV’s shares increasing by 1.65 points. Adjusted profit before tax also surged by 228 per cent.

Net debt was cut down from £612 million in 2009 to £188 million last year.

Commenting on the results, Joshua Raymond, market strategist at City Index, said: “The broadcaster also announced that it was planning on reinstating its dividend, a move that was always likely to be heralded by shareholders.”

He added that after yesterday’s announcement, share prices made a nine per cent gain “to levels not seen since November 2007″.

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About City Index

Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index trading platform.

As a group, we transact in excess of 1.5 million trades every month for individuals in over 50 countries worldwide. We provide access to a wide range of instruments including margined foreign exchange, CFD trading and, in the UK, spread betting.

We constantly look to widen the range of assets we offer, improve the performance of our platforms and expand the range of services we provide. The result is that our customers spread bet using innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer service and support.

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Financial spread betting and CFD trading market update from City Index (http://www.cityindex.co.uk/) TUI Travel has proven to be the leading riser on the FTSE 100 this morning (April 5th). The share prices of the company were up by 4.44 per cent on the London Stock Exchange’s premier index as of 10:14 BST, a rally of almost ten points compared to yesterday’s close. Such trading success followed rumours that an Ormani fund has taken a 15 per cent stake in Hapag-Lloyd, a German shipping company which TUI AG also has a holding in. RBS was reported by the Guardian as saying: “TUI still has net debt of €1.6 billion (£1.4 billion) and we see the best use of any proceeds from the sale of its Hapag-Lloyd stake going to reduce this leverage.” It added that “monetising” the shipping firm could allow TUI to turn more attention to the leisure side of its business. The second-biggest riser on the FTSE 100 was Resolution, which enjoyed a share price boost of 2.99 per cent as of 10:21 BST. See how you can trade CFDs with City Index at http://www.cityindex.co.uk/cfd-trading/ Spread betting and CFD trading are leveraged products which can result in losses greater than your initial deposit. Ensure you fully understand the risks. Spread betting and CFD trading are exempt from UK stamp duty. Spread betting is also exempt from UK Capital Gains Tax. However, tax laws are subject to change and depend on individual circumstances. Please seek independent advice if necessary. About City Index: Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index trading platform. As a group, we transact in excess of 1.5 million trades every month for individuals in over 50 countries worldwide. We provide access to a wide range of instruments including margined foreign exchange, contracts for differences (CFDs) and, in the UK, financial spread betting. We constantly look to widen the range of assets we offer, improve the performance of our platforms and expand the range of services we provide. The result is that our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer service and support. For more information, visit http://www.cityindex.co.uk/

Looking around the news, there is a story that the insurance regulators from five US states have just agreed a $2 million settlement with two Nationwide Life companies for failing to properly supervise the sale of annuities through one of their agents. This raises two questions. What exactly are annuities? and What can go wrong with them? An annuity is a variation on the traditional life insurance policy. As with any permanent policy, you pay a premium which is invested to build up a cash value. But, depending on the terms of the contract, you can receive payment of a lump sum or, more usually, a regular income from the insurance company before your death.

For most people it’s the same as saving for retirement, except you buy a pension that pays out after you retire. To ensure the maximum control over annuities, they can only be bought through life insurance companies. In every US state, there is a Department or Office of Insurance to regulate local insurance companies. As you will understand from the news story, if an insurance company acts against the interests of its policyholders, the states can step in to fine the company and order the company to pay compensation to the policyholders affected. In the case of annuities, this is particularly important because the premiums are usually deductible from income before tax. The states therefore have a direct interest in ensuring annuities are not used for unlawful tax avoidance purposes.

Annuities are more complicated than the traditional life insurance contracts and it is always a good idea to have independent advice before buying. In theory, this ensures the fees and charges made by the insurance company are reasonable and that the minimum guaranteed amounts are a realistic investment return on the premiums you pay. During the first phase of the contract, all benefits are deferred, i.e. assuming your life continues, no benefits are paid. But when the trigger occurs – this may be a specific date or an event – the investment fund begins to make payments either to you or the person you nominated to receive the income. This payment can continue for a set period of time or during your lifetime. There can also be benefits paid to your dependents on death. None of this should prevent you from getting life insurance quotes for annuities through sites like this. Getting information about financial products is always useful. But never buy an annuity unless you are sure you understand exactly what the life insurance company is offering.

In the news story, a financial advisory firm in Kansas acted as the agent of two Nationwide Life companies. It sold annuities and then later persuaded its clients to transfer to a new set of annuities specially created by the Nationwide Life companies. In all cases, this transfer caused a loss of investment value to the clients and resulted in them paying $10 million in fees. When complaints were made, the Nationwide Life companies have reinstated the original policies, refunded the fees and paid a penalty to the state regulators. As an aside, this is what should be happening on a regular basis to all the brokers who missold sub-prime mortgages before the housing bubble burst. If you think you have been missold a life insurance product through life insurance quotes obtained online or as a result of bad advice, complain to your local state’s Department or Office of Insurance. If your complaint is upheld, you will be compensated for all your losses.