News - 3 September 2007

The Alpha Update

What is Happening With Finance Companies? ?

There has been a huge amount of speculation, scandal and mis- information printed in the press in the last few weeks. Here are my tips on how to stay safe and still make a dollar (my opinion only!)

• Research the directors and what the company does. If the directors' history is dodgy and you don't understand what the company does - stay away
• Don't put all your eggs in one basket to get the best rate. Banks aren't the best option for 100% investment and neither is just one finance company. SPREAD YOUR RISK!
• Good companies can get affected by events beyond their control and they can't peddle backwards fast enough!
• Finance companies play a very important part in financing a multitude of NZ businesses and activities that banks don't. If the return is commensurate with your perception of the risk, then keep investing in finance companies!

If you, or anyone you know, wants to know more or has questions about their particular situation, give Stuart a call on 021 676 747 or 0800 676 747. We Can Help!

Food for Thought

Live like you will die tomorrow, learn like you will live forever!

What's New??

• "The Beginners Guide to Commercial Property Investment" Free from Alpha Financial Solutions Ltd

For more information about any of these opportunities, email Stuart@alphagroup.co.nz

Interest Rate and Currency Comments

On the surface, a relatively benign period, with little change in published interest rates. However, below the surface, long term rates are trending downwards and shorter term rates are on the rise. Across the board, our interest rates will get more expensive as it costs more to borrow from the offshore lenders and investors with deep pockets

The dollar has yo-yoed over the past fortnight as the turmoil in international currency markets has thrown the kiwi all over the place. The fringe nature of the kiwi dollar provides sellers with motive, whilst our high local interest rates provides buyers with an opposite motive. Further choppiness will be inevitable!

(See below for latest interest and exchange rates).

The Finance Markets

As of 8am on Monday 3 September 2007 the following Interest Rates applied:
Official cash rate 8.25% (stable)
90 day bill rate 8.63% (down)
5 year bond rate 6.73% (down)
NZ/US Dollar 0.7028 (up from 0.6825)

Current Range of Interest Rates for home and investment mortgages as at 3 September 2007.

Floating:
9.6 to 10.80% (stable)

Fixed For:
1 Year - 9.20% to 10.15% (up slightly)
2 Year - 9.15% to 9.95% (stable)
3 Year - 8.90% to 9.95% (stable)
4 Year - 8.90% to 9.85% (stable)
5 Year - 8.80% to 9.68% (stable)

For a complete table of interest and exchange rates, click here.

The information stated herein was correct at the time of release, but is subject to changes without notice.