Senin, 30 April 2012

Your Dental Insurance - Is It Worth the Premium?

Many of us may not realize, but having healthy teeth is often the most important factor in your overall health. Even an otherwise healthy person with no chronic ailments can begin to have health problems if his or her teeth and gums are not properly maintained and undergo regular exam by a qualified dental physician.
Before I talk about dental insurance, let me share with you some facts about your dental health.
Your dental hygiene and health are crucial. Most non-inherited or non-genetic diseases start with your oral health or lack of it. Digestive problems, intestinal problems, circulatory problems--they are all related to how healthy your mouth, gums and teeth are. And the care of your dental and periodontal health starts as a child. Here are some common tips we can and should follow daily.
  • Brush your teeth at least twice a day

  • If possible, use mouth rinse after every solid meal

  • Use high quality toothbrush and toothpaste

  • Make regular use of rotating cleaners

  • Floss at least thrice a week

  • Exercise your lower jaw muscles regularly

  • Watch for stuck food particles--once lodged, it is hard to take out and the breach in the tooth or between the teeth should be corrected through a filling or a crown

  • See your dentist as scheduled. Some dentists may want to see you more than twice a year--do not think they are racking up fees unnecessarily. Your poor dental health may required more frequent treatments like clinical flossing, deep cleaning etc.There are basically three areas of your mouth that you need to take care of:
Breath: Bad breath is a pre-cursor to some serious issues with your dental health. It may be caused by anything from tooth decay to cancer. Persistent bad breath should be checked.
Teeth-related problems: These typically consist of decay (loss of enamel), crack or chip, sensitivity and loose grip
Gum and Mouth related problems: These typically consist of erosion, infection and sores and bone disease.
So how about your dental insurance. Of course each situation is different, but in evaluating your dental insurance, here are the questions to ask for:
1. Who will be using the services of a dentist or dental specialist like a periodontal physician--is it an adult or a child in your family?
2. Is there a chronic problem?
3. Do you have a favorite dentist you would like to keep on your plan?
4. How much are you willing to pay out of pocket for a) maintenance and b) special conditions like an implant?
5. Are there waiting periods in the policy for certain prescribed treatments like crown, implant, deep cleaning etc.?
6. Is there a sub-limit, e.g. for x-rays etc.
Most dental insurance plans have maximums or caps. These are generally $2,000 to $4,000 annually per member, and then there may be a family cap.
One other thing. If you change your dentist, make sure you get all critical documents from the previous dentist. A very important document is the set of x-rays and dental chart. If your new dentist does not have a recent one from the previous dentist, he or she will order new x-rays and that can cut into your reimbursable amount from the insurance company. If they are recent, insist on your new dentist using those, rather than ordering new x-rays.

Kamis, 01 Maret 2012

Do You Sell or Hold After Your Stock Has Dropped?

Do you sell or hold a stock that has had a big drop? Is it too late to sell? Whether your stock has had a big loss or small loss should not make a difference. Judging a loss by its magnitude is an arbitrary approach to risk control. For example, it would be a more rational way to control risk to base decisions on abnormal stock behavior, an inability of a moving average, trendline, or other line of support to keep a stock from falling below that support, or on a change in trend. Sometimes a switch to another stock makes much more sense than to continue to hold a declining stock.
Let's say you paid $100 per share for 100 shares of a stock that subsequently falls to $80. Traders would never permit a big loss like that, but people who have not learned how to control risk might. To simplify these comments, assume that you have only one stock. Thus, your portfolio has dropped in value from $10,000 to $8,000. If this stock is still declining, to continue to hold would be to invite further loss. You have a choice. You can hold the stock, determined not to sell unless you have a profit, or you can switch to another stock that is already moving up in value. People who keep holding a declining stock after a 20% drop are apparently overlooking the fact that it is possible for a stock to decline to less than a dollar and remain there for several years before it recovers, if it ever does recover (even great companies sometimes go out of business).
Some people say, "I'll just wait until the stock gets back to where I bought it." However, the stock does not "know" what you paid, nor does it care. For practical purposes, it only "knows" where supports and resistances are (regions of demand and supply in the market for that stock). Your personal gain or loss is of absolutely no consequence to the stock. Though you may suffer some loss by selling a declining stock that is below your purchase price, you actually improve your portfolio by moving to a stock that is currently in a rising trend rather than declining. Even moving out of the stock and into cash would be an improvement, because the cash is not losing value.
We do not want to sell stocks in reaction to normal day-to-day fluctuations. However, if a stock declines with enough energy that it breaks through its underlying support, or if the stock's trend changes direction, continuing to hold the stock can be disastrous. A person who lets his stocks fall more than 20% really does not have a risk-control system. In fact, he may not even have a sell strategy. That is asking for financial pain and suffering. Many investors use moving averages to get a clear picture of a stock's trend. It may be okay under some circumstances to ignore changes in the very short-term trend of a stock, but ignoring a change in the long-term trend is foolish. If you are a beginner with no sell discipline at all, there is a simple strategy that can save your financial neck when you are unsure of how to respond intelligently to market turmoil.
For long-term investors, we suggest averaging the price of a stock for about 30 weeks (150 market days) and plotting this average on a daily basis. When this trend starts to turn down, it is a warning that the average performance of the stock for the most recent 150 days (ending today) is evidencing significant deterioration relative to the 150-day performance of the stock. This means that the deterioration in performance being witnessed goes beyond the mere day-to-day fluctuations experienced by every stock. Why is that? When we average price activity over 30 weeks or 150 days, the normal day-to-day fluctuations of the stock (which wave theorists refer to as "noise" because they obscure the more significant underlying waveforms) are reduced to insignificance (they are effectively factored out). This enables a person to see more clearly the underlying pattern of a stock's price movement.
There is another reason for using the 150-day moving average. One expert trader has tested all single moving averages from the 3-day moving average to the 200-day moving average as the basis for a trading discipline. Tests were performed covering many years and thousands of stocks. Results for all stocks were combined for each moving average system. While the 200-day moving average does offer more support for a declining stock, trading with the 150-day moving average was the most profitable. It simply gave a greater amount of total profit (accumulating profits and losses from all stocks over many years) when we based buy and sell signals on this moving average. There are, of course, variations on other moving averages, combinations of moving averages and completely different systems that produce better results. However, all things being equal and considering only single moving averages (simple and exponential), the 150-day simple moving average was the most profitable in our tests.
What is the strategy? Buy when the stock is closing above the 150-day moving average and the 150-day moving average first turns up. Sell when the stock is closing below the 150-day moving average and the 150-day moving average first turns down. Instead of using the closing price relative to the 150-day moving average, you could use a 10-day moving average in order to reduce the number of false signals. Thus, you could buy when the 10-day moving average crosses above the 150-day moving average and the 150-day moving average begins to rise. You could sell when the 10-day moving average crosses below the 150-day average and the 150-day moving average begins to decline.
Market strategists know that it is wise to avoid investing in a stock against its prevailing trend because trends tend to persist. When the trend turns down on a $50 stock, it may not turn up again until after the stock falls below $25. Why wait to see how far it will drop? Why not simply improve the position while you still have most of your money? Selling at a 20% loss and immediately moving on to a better situation may involve a little pain, but it is preferable to holding on to a declining stock that eventually loses 50% (and then to continue holding on to it for an additional two years while it recovers). Using the former approach, we could break even in six months or less. Using the latter approach, we might break even in two or three years (assuming that the stock indeed recovers). Therefore, we are suggesting for those who are not traders and who have no defined sell strategy, that they consider using a sell strategy based on the 150-day moving average and to use 20% as the maximum loss. If the system based on the 150-day moving average gets you out before a decline of 20% occurs, so much the better. If it does not get you out before the decline reaches 20%, then perhaps it is time to pull the plug anyway.
The 20% maximum loss is based on the assumption that the investor has at least 10 positions in his portfolio. That way, a 20% drop in any individual stock will cost the portfolio no more than 2%. Of course, you may decide to modify both the moving average system and the maximum allowable decline so that they better suit your own investment objectives and tolerance for risk. However, our own position is that risk is reduced when losses are kept small, because it is much easier to recover from a small loss than from a large one.
By using a strategy like the one outlined here, you have an answer to the original question. You will have a sell discipline that will get you out of a position most of the time before the loss becomes too great. However, if it does not, you will have a backup sell discipline that takes over. The market is sometimes quite confusing. The strategy outlined here will help you do what is necessary under the prevailing conditions. You may learn after the fact that the action you took was the wrong one. However, no system exists that is always right. Investors have to learn to accept the fact that wrong decisions are made by even the best traders. There is, however, one thing the best traders agree on and have in common. They all have a well-defined discipline, and they do not second-guess it.