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subject: Understand Your Opportunity Cost [print this page]

The concept of "opportunity cost" -- sometimes also called

"lost opportunity cost" -- is vitally important for you to

understand.

Basically, when you have a choice between two courses of

action, and you choose one of the actions, then the benefit

you would have gained from the other action can be regarded

as your opportunity cost.

It's important to evaluate your opportunity costs, because

they can teach you some valuable lessons. It certainly did

that for me.

Here's my short story on "lost opportunity." Back in August

of 2011, I decided I was going to start trading in U.S.

Treasury Notes. These include 10 Year and 30 Year Treasury

Bonds or Notes, which are sold by the U.S. government.

If you are a savvy investor and study the market and stay up to

speed on current events, you can trade these Notes on a daily

basis and make a solid income. Of course, like any type of

investing, there is risk involved.

So I opened an account with $2200 and after a few weeks of

studying the market and learning the trading platform, I began

placing some trades. Some days I profited $300 to $400 dollars.

Other days I lost $300 to $400 dollars.

It was actually quite exciting and certainly an adrenaline rush,

especially on those days when you rake in hundreds of dollars in

profits within a 20 to 30 minute time span.

Anyway, to make a long story short, after a few months and

some success and some failure, the balance in my account stood at

slightly negative. So I decided to cut my losses and close the

account.

Bottom line: I didn't make any money and didn't lose very much

either. But there was another cost involved -- particularly an

opportunity cost.

Here's what I mean. If I had taken that $2200 and invested it in a

2% daily passive program instead, here's is what my account would

look like today, according to my nifty calculator:

* On Aug. 1, 2011, my initial deposit would have been $2,200

* As of Mar 01, 2012, I would have 3,914 active positions

providing a daily earnings of $782.80

* My total 2% earnings would be: $62,034.40

* Earnings Reinvested : $62,030.00

Of course, hindsight is 20/20. I have since charted a new strategy

using a 2% daily passive income program as my investment vehicle.

Moral of the story: It's never too late to change your course of action.

In evaluating a program and the opportunity cost, the ease of making

money and the likelihood that you'll make money are most important

criteria.

When considering a 2% daily investment program, it is imperative that

you follow a defined strategy, like the one I have created here:

http://bluewave-marketing.com/?page_id=221

All you need to do is make up your mind to invest and reap the rewards

that will be coming to you once the plan is followed.

For information on my recommended investment vehicle, visit my blog

and click on the 2% Club link.

by: A.L. Royce

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