Chartered Financial Analyst

Chartered Financial Analyst (CFA) is an international professional designation offered by the CFA Institute of USA (formerly known as AIMR) to financial analysts who complete a series of three examinations. Candidates must have a bachelor's degree (or equivalent), be in the final year of their bachelor's degree program, or have at least four years of qualified, professional work experience in order to take the exams. In order to become a "CFA Charterholder" candidates must pass all three exams, agree to comply with the code of ethics, pay member dues, and have four years of work experience deemed acceptable by the CFA Institute. The CFA Institute's CFA program is not related to the Indian CFA offered by ICFAI in India. CFA charterholders are also obligated to adhere to a strict Code of Ethics and Standards([1]) governing their professional conduct.

The CFA designation

The CFA designation is a qualification for finance and investment professionals, particularly in the fields of investment management, investment banking and financial analysis of stocks, bonds and their derivative assets. The program focuses on portfolio management and financial analysis, and provides a general knowledge of other areas of finance.

From 1963 (when the CFA designation was first awarded) to 2006, approximately 78,000 people from at least 126 different countries have been awarded the right to use the CFA designation, 68,000 of them in the years since 1990. As of 2006, more than 116,000 more people are currently enrolled to take one of the examinations. [2])

History

The predecessor of the CFA Institute, the Financial Analysts Federation (FAF) was originally established in 1947 as a service organization for investment professionals in its societies and chapters. In 1990, in hopes of boosting the credential's public profile, the CFA Institute (formerly the Association for Investment Management and Research or AIMR) was created from the merger of the FAF and the Institute of Chartered Financial Analysts (ICFA). Many Financial Analysts (FA credential) were "grandfathered" into CFAs without taking any of current levels as a result of 1990 merger with between the ICFA and FAF.

The CFA program began in the United States, but has become increasingly international with many people becoming charterholders across Europe, Asia and Australia. By 2003 fewer than half the candidates in the CFA program were based in the US and Canada, with most of the other candidates based in Asia or Europe. India and China have shown some of the highest growth from 2005-2006 with increases of 25% and 53% respectively in the total number of charterholders.[3]

Requirements

The basic requirements for membership in the CFA program include holding or being in the final year of a university degree (or international equivalent), or having four years of qualified, professional work experience in an investment decision-making process. The requirement necessary to begin the process of examination is to have four years of general work experience, a degree, or a combination of both, opening the door to a broad range of individuals. [4]

The CFA exam

A group of CFA candidates waiting in front of the testing location of San Francisco before the test. Dec 2, 2006

Candidates generally take one exam per year over three years and are written at a postgraduate level for financial professionals. Fees for the June 2008 exams range from $600 to $930, depending on the date at which the candidate registers to take the exam. Exams are challenging, with only 40% passing the Level I and II exams and 50% passing Level III in June 2007 (39% for Level I in December 2007) [5], [6]. In 2006, Europe achieved the highest average pass rate for the Level I, II and III of the exam with an overall success rate of 57% of candidates; versus 54% for the USA and 49% in Asia and Pacific Asia.

• The Level I study program emphasizes tools and inputs and includes an introduction to asset valuation and portfolio management techniques.
• The Level II study program emphasizes asset valuation and includes applications of the tools and inputs (including economics, financial statement analysis, and quantitative methods) in asset valuation.
• The Level III study program emphasizes portfolio management and includes strategies for applying the tools, inputs, and asset valuation models in managing equity, fixed income, and derivative investments for individuals and institutions.

All three exams are administered on paper on a single day; the Level I exam is administered twice a year (usually the first weekend of June and December). The Level II and III exams are administered once a year, usually the first weekend of June. Each exam consists of two three-hour sessions. Level I is multiple choice - all information required to answer the question is contained in the question. Level II is item set - a vignette followed by selected response questions. To answer each question, the candidate must refer to the vignette as there is insufficient information in the question stem. Level III consists of a session of short-answer questions and a session that is item set. On the multiple-choice/item set sections, there is no penalty for wrong answers.

Candidates who have taken the exam receive a score report that is intended to be fairly unspecific: there is no overall score for the test, only a Pass/Fail result. For each category of questions, each test-taker is given a broad range within which his or her performance falls: below 50%, between 50% and 70%, and above 70%. The passing grade for the exams has been defined as 70% of the top percentage of exam papers until 1989; since then, the grading method is not explicitly published.[7] and the minimum passing score is set by the Board of Governors after each exam. The Board of Governors review the results of a Standard Setting process and input from psychometricians. Standard Setting is a process by which CFA Charterholders from around the world review the exam and recommend, for each question, a minimum passing score for the "just qualified candidate". The minimum passing scores for each question are aggregated and presented to the Board of Governors as a recommended minimum passing score for the entire exam. The Board of Governors is not bound by this recommendation, but does recognize it as very important information.

The CFA curriculum

The curriculum for the CFA program is based on a Candidate Body of Knowledge established by the CFA Institute. The curriculum includes:

• Ethics and Professional Standards
• Quantitative Methods (such as the time value of money, and statistical inference)
• Economics
• Financial Statement Analysis
• Corporate Finance
• Analysis of Investments (stocks, bonds, derivatives, venture capital, real estate, etc.)
• Portfolio Management and Analysis (asset allocation, portfolio risk, performance measurement, etc.)

For exams in 2008 onwards candidates are required to purchase the curriculum readings from CFA Institute. Unsuccessful candidates are required to buy the same curriculum again when they re-register for the exam.

The ethics section is primarily concerned with compliance and reporting rules when managing an investor's money or when issuing research reports, although there are some rules which pertain to more general professional behaviour (such as prohibitions against plagiarism). There are also rules that specifically relate to the proper use of the designation for charterholders and candidates. All of these rules are delineated in the 'Code and Standards'.

The section on quantitative analysis is dominated by statistics and time series analysis. Other financial fundamentals such as the time value of money are also addressed. The statistics topics are fairly broad, but the main focuses are risk analysis, hypothesis testing and regression analysis. For the test, only two types of calculator are allowed (the Hewlett Packard 12C and the Texas Instruments BA II Plus). The test also features other quantitative topics, but these are covered in other sections. For example, calculating depreciation of assets is a part of financial statement analysis (accounting), and determining currency arbitrage is a part of international economics.

Both micro- and macroeconomics are covered. There are sections for international economics, mainly related to currency conversions and how they are affected by international interest rates and inflation.

The accounting section is heavily tested at Levels I and II, but is not a significant part of Level III. It is divided into financial statements analysis and corporate finance. Financial statement analysis considers the statement of cash flows, the balance sheet, and the income statement. Each of these documents gives a distinct view into the state and operations of a company. Corporate finance uses these views of the company to make decisions about projects, deciding how they will impact the company.

The section on security analysis is divided by the types of security. There is a general section on global markets, sections on equity (stocks), fixed income (bonds), and derivatives (futures, forwards, options and swaps). The first levels of the test require familiarity with these instruments, then the focus develops into correctly valuing them, and how to properly use them.

The final section is portfolio management. This section increases in importance with each of the three levels. Portfolio management is an analysis of the process of managing money. It depends heavily on all of the other topics. When managing money for others, ethics is obviously important. This section deals with how the investors' needs are met by the portfolio manager. Modern portfolio theory is also tested: the efficient frontier, Capital asset pricing model, etc.

The Code of Ethics

Members of CFA Institute (including charterholders and candidates for the CFA designation) must:

• Act with integrity, competence, diligence, respect, and in an ethical manner with the public, clients, prospective clients, employers, employees, colleagues in the investment profession, and other participants in the global capital markets.
• Place the integrity of the investment profession and the interests of clients above their own personal interests.
• Use reasonable care and exercise independent professional judgment when conducting investment analysis, making investment recommendations, taking investment actions, and engaging in other professional activities.
• Practice and encourage others to practice in a professional and ethical manner that will reflect credit on ourselves and the profession.
• Promote the integrity of, and uphold the rules governing, capital markets.
• Maintain and improve their professional competence and strive to maintain and improve the competence of other investment professionals

Financial planner

Objectives

People enlist the help of a financial planner because of the complexity of knowing how to perform the following:

• Providing direction and meaning to financial decisions;
• Allowing the person to understand how each financial decision affects the other areas of finance; and
• Allowing the person to adapt more easily to life changes in order to feel more secure.

Defining personal financial decisions

Personal financial planning is broadly defined as a process of determining an individual's financial goals, purposes in life and life's priorities, and after considering his resources, risk profile and current lifestyle, to detail a balanced and realistic plan to meet those goals. The individual's goals are used as guideposts to map a course of action on 'what needs to be done' to reach those goals.

Alongside the data gathering exercise, the purpose of each goal is determined to ensure that the goal is meaningful in the context of the individual's situation. Through a process of careful analysis, these goals are subjected to a reality check by considering the individual's current and future resources available to achieve them. In the process, the constraints and obstacles to these goals are noted. The information will be used later to determine if there are sufficient resources available to get to these goals, and what other things need to be considered in the process. If the resources are insufficient or absent to meet any of the goals, the particular goal will be adjusted to a more realistic level or will be replaced with a new goal.

Planning often requires consideration of self-constraints in postponing some enjoyment today for the sake of the future. To be effective, the plan should consider the individual's current lifestyle so that the 'pain' in postponing current pleasures is bearable over the term of the plan. In times where current sacrifices are involved, the plan should help ensure that the pursuit of the goal will continue. A plan should consider the importance of each goal and should prioritize each goal. Many financial plans fail because these practical points were not sufficiently considered.

Scope

Financial planning should cover all areas of the client’s financial needs and should result in the achievement of each of the client's goals. The scope of planning would usually include the following:

Risk Management and Insurance Planning

Managing cash flow risks through sound risk management and insurance techniques

Investment and Planning Issues

Planning, creating and managing capital accumulation to generate future capital and cash flows for reinvestment and spending

Retirement Planning

Planning to ensure financial independence at retirement

Tax Planning

Planning for the reduction of tax liabilities and the freeing-up of cash flows for other purposes

Estate Planning

Planning for the creation, accumulation, conservation and distribution of assets

Cash Flow and Liability Management

Maintaining and enhancing personal cash flows through debt and lifestyle management

The process

The personal financial planning process is generally accepted as a six-step process as follows:

Step 1: Setting goals with the client This step (that is usually performed in conjunction with Step 2) is meant to identify where the client wants to go in terms of his finances and life.

Step 2: Gathering relevant information on the client This would include the qualitative and quantitative aspects of the client's financial and relevant non-financial situation.

Step 3: Analysing the information The information gathered is analysed so that the client's situation is properly understood. This includes determining whether there are sufficient resources to reach the client's goals and what those resources are.

Step 4: Constructing a financial plan Based on the understanding of what the client wants in the future and his current financial status, a roadmap to the client goals is drawn to facilitate the achievements of those goals.

Step 5: Implementing the strategies in the plan Guided by the financial plan, the strategies outlined in the plan are implemented using the resources allocated for the purpose.

Step 6: Monitoring implementation and reviewing the plan The implementation process is closely monitored to ensure it stays in alignment to the client's goals. Periodic reviews are undertaken to check for misalignment and changes in the client's situation. If there is any deviation or significant change to the client's situation, the strategies and goals in the financial plan are revised accordingly.

What is a financial planner's job function?

A financial planner specializes in the planning aspects of finance, in particular personal finance, as contrasted with a stock broker who is only concerned with the actual investments, or with a life insurance intermediary who advises on risk products.

Financial planning is usually a six-step process, and involves considering the client's situation from all relevant angles to produce integrated solutions. The six-step financial planning process has been adopted by the International Organization for Standardization (ISO).^[1] Financial planners are also known by the title financial adviser in some countries, although these two terms are technically not synonymous, and their roles have some functional differences.

Although there are many types of 'financial planners,' the term is used largely to describe those who consider the entire financial picture of a client and then provide a comprehensive solution. To differentiate from the other types of financial planners, some planners may be called 'comprehensive' financial planners.

Other financial planners may specialize in one or more areas, such as insurance planning and retirement planning.

Financial planning is a growing industry with projected faster than average job growth through 2014.^[2]

Licensing, regulations and self-regulation

The title of 'financial planner' is largely an unregulated term in many countries. Lack of regulation has allowed financial services personnel in these countries to use the title indiscriminately. Often, financial products intermediaries, such as life insurance and unit trusts agents, use the title to project a professional image to clients even when they are not trained in the professional aspects of financial planning. This has sometimes led to abuse. Clients may be deceived to receive financial planning services that are unprofessional, from unethical providers.

To protect the industry, financial planning professionals and practitioners from across the globe (starting from the United States) have begun to form trade organisations to provide self-regulations and to maintain some orderliness in the industry. Some, such as the FPA, have begun to organize high-level training programmes and certify members who successfully completed these programmes.

The title of 'financial planner' continues, however, to be used by individuals in the financial industry in most countries, as there are little or no legal barriers to prevent the use of the title. The governments in many countries where the financial planning profession is taking roots are beginning to play an increasingly active role in tasking themselves to ensure the market is orderly. More stringent laws and guidelines are being progressively introduced to keep the profession in check.

Australia

In Australia, the financial planning services are initially delineated by law by the granting of licence to deal in securities or advise on investments. Licences are issued under stringent criteria by the Australian Securities and Investments Commission (ASIC), which has evolved these regulations vigorously over the years.^[3] Financial planning is now a highly regulated industry in Australia especially where financial advice to the public is involved. Practitioners who offer advice that could influence a client's decision to purchase a financial product must meet minimum training requirements and be licensed by the ASIC. The meaning of 'licenced' refers to Australian Financial Services Licence (AFSL) holders and representatives or authorised representatives of licence holders. Broadly, most people embarking in financial planning will start as an authorised representative of a licence holder.

Becoming a financial planner in Australia involves two main steps:

1. Meet the training requirements of Regulation Guideline 146;
2. Select a licence holder with whom to be affiliated.

The licence holder is the authorised representative, and will be ultimately responsible for the advice given by the planner. The licence holder therefore must make sure the representatives meet all compliance and training prerequisites. As of November 2005, there were approximately 4,300 licence holders registered with ASIC and over 42,500 authorised representatives in Australia.

Malaysia

The first country to introduce legislation that requires a person to be licensed before he can hold himself out to be a 'financial planner' is Malaysia. Financial planning is considered a newer profession in the Asian region as compared to those in the west, such as the United States and Australia where the profession is more established. The Securities Commission (SC) of Malaysia introduced legislation through amendments made to the Securities Industry Act in 2003 to regulate financial planning and the use of the title or related-title of 'financial planner' or to conduct activities related to financial planning.^[4]

In 2005, amendments to the Malaysian Insurance Act require those who carry out financial advisory business (including financial planning activities related to insurance) and/or use the title of financial adviser under their firm (which, like in Singapore, must be a corporate structure) to obtain a licence from Bank Negara Malaysia (BNM).^[5] Some persons who offer financial advisory services, e.g. licenced life insurance agents, are exempted from licensing as a practising requirement.

Again, in 2007, the Capital Market Services Act (CMSA) comes into force as another of the consolidation exercises of the government to move the industry towards a one regime regulatory environment.

As it currently stands, one of the basic requirements to apply for a financial planner or financial adviser licence in Malaysia is that the key company officers, e.g. directors, must be an RFP designee (most if not all Malaysian FChFP designees also carry the RFP designation). Subsequently, in September 2006, the CFP qualification is included as one of the alternatives that can be used by the financial adviser licence applicant. With this development, the demand for financial planning courses has begun to take root in more concrete forms in Malaysia. The licence applicant must also be a member of a self-regulatory organisation (SRO) in financial planning recognised by the authorities. For this purpose, the two SROs currently recognised by both the Security Commission and Bank Negara are the Malaysia Financial Planning Council (MFPC) and the Financial Planning Association of Malaysia (FPAM). The purpose of this requirement is to ensure some form of self-supervision for persons practicing financial planning.

Other countries

In some countries, e.g., the United States, financial planners must be registered as an investment advisor first. This requires an employee within a firm to pass the series 65 or 66 Registered Investment Advisor Exam. A private advisor or company can apply to the state and SEC for an RIA Registered Investment Advisor License or Status.

Being 'licenced' to practice financial planning is not the same as merely having a professional 'qualification' in financial planning. A person may be professionally qualified in financial planning, but without a licence required by the law, he cannot practice the trade in that country or call himself a financial planner there. As of now, there are quite a bit of qualifications related to financial planning that can be found in world. The most prestigious financial planning designations are those which are not just of advanced standing and well-known, but are also recognised by the relevant authorities for licensing purpose.

In some places, individual employees within a licensed & registered Investment Advisor firm such as a: brokerage, bank or insurance company may be exempt if providing complementary financial planning services in relation to their existing products and services. Moreover, financial planners should be extremely careful in providing estate planning or taxation advice for a fee, as these fields are highly regulated by government agencies that control the practice of lawyers and Certified Public Accountants (CPAs). The term "Investment Advisor" also includes any person who uses the title "financial planner" and who, for compensation, engages in the business, whether principally or as part of another business, of advising others, either directly or through publications or writings, as to the value of securities or as to the advisability of investing in, purchasing or selling securities, or who, for compensation and as part of a regular business, publishes analyses or reports concerning securities.

From the California Department of Corporations

A financial planner will be registered with the state if he or she has less than $25 million in assets under management (AUM), and with the SEC if he or she has more than $30 million in AUM. The planner is required to present a client with the ADV Part II or equivalent before the client enters into a contract with the planner. No certification, tests or training ensure that any planner is suitable for the client or any investor, and it is important to read the ADV Part II, interview them, and fully understand any contract.

History of certifications in financial planning across the globe

In a newly emerging profession such as financial planning, there is a lack of regulation, especially in the early years of development. The need for some forms of self-regulation and the demand that a financial planner be competent and trustworthy have prompted several independent financial services organizations to introduce certifications and ethical benchmarks to meet these challenges in accordance to the need in each country. Those who meet the requirement of the certification process and ethical standards will be awarded a professional financial planning designation.

One of the oldest, most well-known financial planning certification service marks is the Certified Financial Planner (CFP), which has gained global recognition because of its active standard setting activities and worldwide presence. The CFP designation was first introduced in the United States in the early 1970s to meet the need of the consumers. The CFP mark now belongs to the CFP Board of Standards (CFP Board), USA, which has member associations world-wide.

The CFP Board was founded in July 1985 as the International Board of Standards and Practices for Certified Financial Planners, Inc., (IBCFP) by the College for Financial Planning (College) and the Institute of Certified Financial Planners (ICFP). The IBCFP became Certified Financial Planner Board of Standards Inc. (CFP Board) on February 1, 1994. As a professional regulatory organization acting in the public interest by fostering professional standards in personal financial planning, the CFP Board establishes and enforces education, examination, experience and ethics requirements for CFP certificants. The CFP service mark is promoted world-wide through member associations, the FPAs.

The Fellow Chartered Financial Practitioner (FChFP) designation was developed by the National Association of Malaysian Life Insurance and Financial Advisors] (NAMLIFA) in 1996. The designation was adopted by the Asia Pacific Financial Services Association (APFinSA) in 2001 as the unified designation for its member associations in 11 countries.

The Registered Financial Planners Institute (RFPI) formed in 1983 in the United States to promote professionalism among those who are or will be active in the field of financial planning for individuals and businesses. The RFPI is an international organization with chapters and members throughout the world. The RFPI offers study programs both in classroom conducted seminars and correspondence courses. RFPI is a collective membership of financial planners and is designed to serve the interest of both its members and the general public in matters relating to financial planning. RFPI recognizes qualified individuals by designation of RFP, SRFP who are in the field of financial planning which would include: insurance, attorneys, real estate, bankers, CPAs, stock brokers, securities or other professionals licensed in similar fields that have the ability to properly financial plan individuals or businesses in their related fields.

The Personal Financial Specialist (PFS) credential was established for CPAs in the United States who specialize in personal financial planning. The credential is awarded exclusively to members of the American Institute of Certified Public Accountants (AICPA) who have demonstrated considerable experience and expertise in that area. As of today, the AICPA has granted approximately 3,300 CPA/PFS credentials.

In Australia, the financial planning specialisation, CPA (FPS), is available to those members of CPA Australia who can demonstrate their eligibility through experience and education within the financial services industry.

The objectives of the FPS designation are to:

• achieve public recognition for those who hold the specialisation;
• enhance the quality of financial planning services that members provide; and
• increase practice development and career opportunities for CPAs.

The FPS designation is available to CPAs, and is based on a points system, where a minimum of 100 points must be accrued. Although all CPA Australia members who provide financial product advice must be licensed by ASIC, a member does not have to be licensed to first obtain the CPA (FPS) designation.

The Chartered Financial Consultant (ChFC) is another financial planning qualification, conferred by American College, USA). Since 1982, the ChFC has remained among the most extensive education available for professionals seeking a designation in financial planning. To date, more than 41,000 individuals have attained this distinction. This designation has also spread to Asia, where designees are found in countries like Singapore, Malaysia, Indonesia, China and Hong Kong.

In Europe, the €uropean Financial Planner (€FP) designation conferred by the €uropean Financial Planning Association (€FPA) is gaining ground as a financial planning certification mark. The €FPA is the largest professional and educational organisation for financial planners and financial advisors in Europe and is the only Financial Planning Association created solely in the interest of European financial planning consumers and practitioners.

The rest of the certification qualifications related to financial planning include: Fellow, Financial Services Institute (conferred by LOMA, USA; the Chartered Wealth Manager (CWM, conferred by the AAFM) designation; the Certified Financial Marketing Consultant (CFMC) conferred by the Institute of Marketing Malaysia.

Accredited business school, training centers and other providers

Globally, cross-recognition agreements are being developed to facilitate the learning of financial planning. The 2 major accrediting agencies, the Association to Advance Collegiate Schools of Business (AACSB) and the Association of Collegiate Business Schools and Programs (ACBSP), which accredit over 560 of the best business school programs, provide the Certification of MFP Master Financial Planner Professional from the American Academy of Financial Management, which is available to AACSB and ACBSP business school graduates with finance or financial services related concentrations.

Financial Analysis

Financial analysis refers to an assessment of the viability, stability and profitability of a business, sub-business or project.

It is performed by professionals who prepare reports using ratios that make use of information taken from financial statements and other reports. These reports are usually presented to top management as one of their bases in making business decisions. Based on these reports, management may:

• Continue or discontinue its main operation or part of its business;
  
• Make or purchase certain materials in the manufacture of its product;
  
• Acquire or rent/lease certain machineries and equipments in the production of its goods;
  
• Issue stocks or negotiate for a bank loan to increase its working capital.
  
• other decisions that allow management to make an informed selection on various alternatives in the conduct of its business.

Contents [hide] 1 Goals 2 Methods 3 See also 3.1 Ratios 4 Notes 5 External links

[edit] Goals

Financial analysts often assess the firm's:

1. Profitability- its ability to earn income and sustain growth in both short-term and long-term. A company's degree of profitability is usually based on the income statement, which reports on the company's results of operations;

2. Solvency- its ability to pay its obligation to creditors and other third parties in the long-term;
3. Liquidity- its ability to maintain positive cash flow, while satisfying immediate obligations;

Both 2 and 3 are based on the company's balance sheet, which indicates the financial condition of a business as of a given point in time.

4. Stability- the firm's ability to remain in business in the long run, without having to sustain significant losses in the conduct of its business. Assessing a company's stability requires the use of both the income statement and the balance sheet, as well as other financial and non-financial indicators.

[edit] Methods

Financial analysts often compare financial ratios (of solvency, profitability, growth...):

• Past Performance: Across historical time periods for the same firm (the last 5 years for example),
  
• Future Performance: Using historical figures and certain mathematical and statistical techniques, including present and future values, This extrapolation method is the main source of errors in financial analysis as past statistics can be poor predictors of future prospects.
  
• Comparative Performance: Comparison between similar firms.

These ratios are calculated by dividing a (group of) account balance(s), taken from the balance sheet and / or the income statement, by another, for example :

Net profit / equity = return on equity

Gross profit / balance sheet total = return on assets

Stock price / earnings per share = P/E-ratio

Comparing financial ratios are merely one way of conducting financial analysis. Financial ratios face several theoretical challenges:

• They say little about the firm's prospects in an absolute sense. Their insights about relative performance require a reference point from other time periods or similar firms.
• One ratio holds little meaning. As indicators, ratios can be logically interpreted in at least two ways. One can partially overcome this problem by combining several related ratios to paint a more comprehensive picture of the firm's performance.
• Seasonal factors may prevent year-end values from being representative. A ratio's values may be distorted as account balances change from the beginning to the end of an accounting period. Use average values for such accounts whenever possible.
• Financial ratios are no more objective than the accounting methods employed. Changes in accounting policies or choices can yield drastically different ratio values.
• They fail to account for exogenous factors like investor behavior that are not based upon economic fundamentals of the firm or the general economy (fundamental analysis)

10 Tips On Promoting Your New Blog

One great way of getting more traffic and more importantly, making the traffic come back to your site over and over again, is by having your own blog.

The term, ‘Blog‘, is becoming more and more popular, and these days most online companies have a blog.

How can you promote your blog? Once you get your blog known, if you have good enough content, then it will promote itself, thats the amazing thing with blogs.

Heres some quick tips to help promote your blog.

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4. Use the power of social netwroking sites, such as digg.com, reddit.com and del.icio.us . If you write a great article, submit it to these sites, if they get picked up by them, you will see a massive increase in traffic to your blog.

5. When writing a post, always make sure you link to as many related sites and blogs. Many blogs have a ‘trackback’ feature enabled which can see what other blogs, like yours, are sending visitors to their blogs. They then usually link back to your blog automatically for free.

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9. Get tips from 2 pro bloggers, such as problogger.net and shoemoney.com

10. Finally, and most important, write great content that is relevant to your website, and you will then find your readers will do your promoting for you.

Blog Hosting on WordPress

Blogs have become quite popular within recent 2-3 years. As of September 2007, blog search engine Technorati was tracking more than 106 million blogs. More and more people nowadays start the blog on a stand alone domain name. Blogs help people to express themselves, it is a perfect tool to start personal on-line diary or professional blog related to any subject.

Apparently blogs are one of the easiest ways to create a website. With WordPress preinstalled, it literally takes a few moments to have a professional looking site up and running and available for millions of visitors from all round the world.

Creating a blog on WordPress does not demand any technical experience or knowledge from you. A great number of design templates will help you to customize your blog and make it to look attractive and professional.

WordPress allows you to post blog content online, thus there is no need use FTP connection from your web hosting provider.

As well it allows you to update your blog content from any place of the world by just loginging to blog admin area which will look like http://www.yourdomain.com/wp-admin/. All you need is to remember your admin login and password. WordPresss automatically updates the order of the posts, archiving older posts by post date and moves the most recent posts to the top of your blog index page.

When you set up stand alone blog on paid web hosting it has more chances to be well indexed and crawled by search engines, since stand alone blog has individual URL and can obtain Google page rank. It is necessary to choose the right keywords in the post title and body.

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Despite of the fact that there are some excellent services that offer free blog hosting services, more and more bloggers prefer to use paid blog hosting. And certainly there are several reasons for this.

When you sign up for a paid web hosting services to create your stand alone blog on a separate domain name you get reliability and some guarantees, such as uptime guarantee. You get in most cases perfect professional and responsive technical support that will help you to answer questions and resolve technical issues when you need this help. This is of great importance if you are newbie and this is your first time setting up blog on WordPress.

Generally for Blog hosting Linux web hosting services are more preferrable. Since Linux web hosting is cheaper and more reliable. However this is you who decide!

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Related articles:

• Using Free Blog Templates
• How Does Blog Hosting Work?
• Why I Love WordPress for Blogging

Ten Ways to Write Great Blog Posts That Get Attention

Millions of blogs fight for readership online (over 75 million by some counts), with thousands more being created every day. Making yours stand above the rest may seem like a daunting task, but here are ten suggestions for making your blog posts stand out from the crowd.

1. Write each post title so it grabs the reader’s attention. It is the first thing someone reads, and it should get your reader’s attention right away. Your title should both pique the reader’s interest and be informative. Do not write “Business Writing Advice”; instead, say “The Best-Kept Secret to Reducing Your Business Writing Worries.” Longer titles have the advantage of describing in detail what your post is about; 8-12 words are a good range.

2. Keep sentences short and clear. A little goes a long way. Readers are busy people and they will not spend hours detangling complex syntax or sifting through blocks of text. Also, use strong language. Start a new paragraph every few sentences, and limit each post to 250 words, if possible. If you cannot write it in under 250 words, split it into two entries.

3. Break up the text. Use numbered lists, bullet points, and subheadings to make your posts easy to scan. Lots of white space on the page is a good thing-it allows your reader to take mental breaks and let the knowledge soak in. In addition, with the inevitable clutter of banner ads and side text, this technique puts some distance between your writing and all those distractions.

4. Keep current. No one wants to read old news. Your job is to stay up-to-date so your readers do not have to themselves. Read newspapers. Scour the web for references. For example, if you write a blog about business communication, subscribe to Google News Alerts using keywords related to the field, such as blogs, podcasting, instant messaging, business letters, memos, and business reports, so you will always be well informed. Posting items from last month or last year will lose your reader’s interest faster than you can say “Enron.”

5. Be bold. Timidity is an easy path to anonymity. Do not be afraid to create and state your opinions. Of course, there are some situations in which objectivity rules-but you have to give people a reason to read this blog by you and not by the person next door.

6. Be accurate. If you make a statement, be prepared to back it up. Know what your sources are and quote them accurately. Misinformation spreads like wildfire online; do not be the spark that sets it off or the wind that fans it.

7. Contribute to the conversation. Links are great-but then what? Do not just post links to the same tired sites, offer your reader something new. Contribute to the conversation. Your goal is to be the site to which everyone else is linking-so you had better have something worth writing about.

8. Stay focused. Once you have defined the theme of your blog, stick to it. A blog about piggy banks has no business posting about the latest innovation in alternative energy. Such a deviance will only confuse your reader and chip away at your virtual authority.

9. Use key words liberally. Keywords are, well, key. Harness your blog’s search engine potential by dousing your title and post with effective keywords that will help interested parties find your page in the vast, muddled blogosphere. This is one of the most important elements of getting your blog read-go at it with gusto.

10. Be consistent. Keep a schedule and stick to it. Post frequently-at least several times per week if you want to increase your potential of attracting new readers. Let your blog languish for weeks without updates and your audience will move on to fresher ground.

Maintaining an informative blog that people want to read takes hard work and good writing skills. Find what makes your writing unique-and flaunt it for all it is worth.

About The Author
Courtland L. Bovee, one of America’s leading instructors in clear and effective communication, co-authors several leading college-level texts with John V. Thill, a prominent communications consultant and current Chairman and Chief Executive Officer of Global Communication Strategies. Their website, Business Communication Headline News, the #1 business communication site on the web, is at http://www.businesscommunicationheadlinenews.com

Tips for Blog Traffic - How to Increase Traffic Levels

There are many ways to increase traffic to a business blog (or an educational blog, or any other kind of blog for that matter). But in my opinion, the best way to increase blog traffic is simply by posting often with quality content.

In fact, there are so many benefits of posting quality content that I’m going to dedicate this entire blog post to the subject…

Increase Blog Traffic With Quality Content

Let’s start by discussing the reasons why people visit a blog in the first place. Think of your own web habits for a moment. Specifically, think about the blogs that you visit a lot. What do they have in common? I’m willing to guess that your favorite blogs do a good job of entertaining you or educating you … or both. And they do this with quality content.

So that’s one of the ways to increase blog traffic with quality content. It turns random visitors into regular readers!

But the benefits of quality blog content don’t end there. Other bloggers and webmasters are also more likely to link to and/or cite one of your blog posts (or your blog in general) if it contains great information. And as you probably know, increasing the number of links to your blog from other websites also increases your search engine ranking. This of course means even more traffic to your blog.

So that’s another way to increase your blog’s traffic levels with quality content. It encourages other bloggers and web publishers to link to your blog, which increases your search engine visibility.

Now I’ve given you two good reasons for publishing great information on your blog. But there’s a third reason that’s closely related to the link popularity mentioned above. When all of those other bloggers and website publishers link to your blog as a resource of some kind, they will send you direct traffic as well. In other words, those links will help you improve your blog’s search engine ranking as well as sending visitors your way. So the links now have a direct and indirect way of increasing your traffic levels.

What Is Quality Content?

Now we know how to increase blog traffic with quality content. Specifically, we have outlined three ways that great content increases traffic levels. It turns visitors into fans, it helps you improve your search engine ranking, and it generates referral traffic from other websites.

But what is quality content and how do you create it?

In my opinion, quality website content has the following traits:

• It explores the subject matter in great detail, regardless of the subject being addressed.
• It is well-written with proper spelling and grammar. Thus it is easy for people to read.
• It is interesting and insightful. It doesn’t just rehash what everyone else is saying — it speaks for itself.
• It is updated often to address current events / changes within the subject matter.
• It is written with a clear purpose in mind. To entertain, to educate, to persuade, etc.

So now you know how to increase blog traffic with quality content. The only thing left for you to do is start generating that great content! Good luck.