Business Action Group

Posts Tagged ‘Investment’

On 13 October in the CEOE Headquarters in Madrid the first Forum: “Turkey, a bridge to new markets” which will discuss opportunities for cooperation and investment between Spain and Turkey.

Through various presentations on the economic relationship between the two countries, this meeting will present discussions on investment in Turkey or the progress of the most dynamic economic sectors like renewable energy and infrastructure.

The meeting, organized by the Spanish Confederation of Business Organizations (CEOE), the Turkish employers DEIK (Foreign Economic Relations Board) and Nexus Fostering Partnership, with the collaboration of the Dogus Group, Garanti Bank, and the Support and Promotion Agency of Investment in Turkey (Invest in Turkey).

Currently Jacanas, with average growth of 7.5% is placed next to the BRIC countries as one of the more interesting when long-term investment. Read the rest of this entry »

The finding that, in many companies, ownership and management are separate functions, led at the time to analyze how impinged the interests of managers (with a utility function itself) on the objectives of the company. If the specific objectives of ownership and management differ, they can lead the search for different business objectives. Therefore, there is a problem of ownership control over the direction to avoid it autonomously set objectives of the company without properly addressing the interests of the property.

The property interests revolve around maximizing their wealth, which translates into maximizing the value of the company. Therefore, the corporate goal of maximizing the benefits of the owner’s role in the decision process. However, the interests of management with monetary components (wages) and non-monetary (promotion, autonomy, prestige, power), in addition to the security or stay in the address.

Management may make a risk assessment than that of the shareholder. Indeed, diversification of business activities may reduce the overall risk of the company, which favors particular managers to reduce the variability of corporate earnings. Although this diversification also reduces the risk of shareholders, they are not particularly interested in it because they can diversify their investment portfolio directly more easily and with greater autonomy, that is, no one decides for them.

It is necessary to reconcile the interests of shareholders and directors. To this end, the property has a number of mechanisms that allow some control over the direction, so as to ensure a convergence of interests. The main mechanisms can be summarized as follows:

Internal mechanisms:

Direct supervision: The Board of Directors is a representative body of the ownership (shareholders) and management of the company. Has a supervisory role which makes the address. The Board of Directors have independent directors who are prestigious professionals to represent the interests of minority shareholders. For good management of the company there is a code of conduct, which is the Olivenza Report.

Ownership of the company.
Incentive systems: They are based on linking the salary of managers to obtain better profits or value creation in the company considers not only profit but the risk attached to it, and the moment of realization. In this way, link the interests of executives (salaries) with those of shareholders.
External mechanisms:

Enterprise market: The not maximizing the value of the company by the directors or the desire to achieve personal goals at the expense of shareholders, could induce foreign businessmen to buy the company and replace your current address. The tender offers for the company serves, therefore, to discipline the behavior of management.
Capital market: The existence of an efficient stock market, limits the divergence between the interests of shareholders and managers. The capital market control over the direction of society is greater because the individual shareholders are becoming less important compared to the institutional shareholders (pension funds, portfolio companies, investment funds, etc.) Operating with more information which increases the efficiency of capital markets.
Managerial labor market: The existence of this market allows managers are evaluated on the basis of value creation to succeed.

End-market competition: When the company operates in a competitive environment, the forces of market competition that the pair push the company’s goal is to maximize its value. If any factor gets a higher pay its share, you can have it affect the very survival of the company.

Investing in real estate or real estate is an investment alternative which is to buy a property as a house, apartment, commercial premises or land, then sell it or rent.

By investing in real estate you acquire a property to expect rises in value and then sell it to rent it immediately, to repair or remodel and then sell it or rent, or build (if you have acquired land) and then selling or renting.

Investment in real estate is for many experts one of the best investment alternative, since it allows one to easily acquire an asset depreciates, which will probably increase its value and, in some cases, can be rented at a good price.

In other words, it considers the investment in real estate as an investment, low risk, safe, and profitable.

Other advantages of investing in real estate is the few skills that are required when investing, and the relative ease in administering the investments, unlike, for example, investing in the stock market.

However, unlike what many think, invest in real estate investing is not easy, as well as the need to have a good capital to invest, it is necessary to have knowledge and good preparation that allows a know, for example, choose either the property, how financed, and ensure that the property will increase in value over time or you can rent it all year round.