Internet money

Got a digital camera? Now you can earn money selling your pictures on the Internet! If you have a good eye and if you are a creative person, you can generate very nice monthly income by selling your pictures on stock photography web sites. Personally, I am receiving checks and PayPal transfers for few hundreds bucks every month and you can do it too. At least, it pays you back for all that nice and expensive photographic gear you have purchased last year.


I truly love online stock photography Internet phenomenon, since it is the first in the world and probably the only business model which allows amateur photographers like you and me to earn some money from they lovely hobby. In fact, if you are a talented photographer and you shoot hundreds of pictures every month you can earn a very significant part of your living by shooting high quality creative pictures for stock photography agencies.


There are many stock photography sites that will be happy to sell your photos and share with you the received revenues. iStockPhoto, ShutterStock, Fotolia, BigStockPhoto and CanStockPhoto are just few stock sites to name. All stock sites allow you to register for free as their submitting photographer and start uploading your work to their banks. However, be aware that many sites will ask you to provide detailed personal information such as a scan of you picture ID or passport. Also, at many sites you will be requested to sign and fax back a signed copy of the site's 'submitter agreement'. These requirements are part of continuous effort of limiting the image fraud on the Internet and protecting both image buyers and image copyright owners from the fraudulent behavior.


In addition to the submitters authentication, many stock photo sites will ask you to pass a professional online test, which should verify that you have all the required photographic skills and that you understand rules of the game on stock photography market. Do not be afraid of that test. If you know the difference between shutter speed and the aperture and if you can explain what is DOF you will pass this test for sure. And the basic stock photography rules are quite simple:

1) Do not submit images that include any copyrighted material Avoid photographing company logos, trademarks, third-party images and brands.

2) Provide a model release for any recognizable person in your image Each site has its own standard model release form that you have to fill in and send along with each image containing a recognizable person. It could be a good idea to keep handly printed copies of model releases for all the sites where you submit your photos. When you shoot a person, do not forget signing her on one or more model releases! Note, that most sites will also ask you for the copy of model's ID, the witness signature and a copy of witness picture ID. Keep all this in your mind when you prepare a stock shooting session

3) Editorial content Some stock photo agencies, e.g. ShutterStock has a separate section / category for editorial images. Different rules set apply for editorial content. Editorial content can be used only in news and therefore editorial images do not require model releases and can include copyrighted material. So, if you have shot a carnival in Brazil do not throw out all your pictures because you do not have model releases for all these people. You still can submit your images as editorial content at some stock photography sites. However, be aware that there are not too much buyers for this type of content and the submitters' competition could be tight.

4) Use appropriate lighting and composition This is common sense, but I will mention it anyway. Your images compete for the buyers attention with images created by highly qualified talented professional photographers which shoot for years, own nice equipment and definitely know how and when use it. You must think creatively in terms of lighting and composition, otherwise your images will never sell.

For instance, if until now you relied on built-in camera flash as a proper source for indoor lighting it is a time to change your mind. Go to the stock sites and take a look how other photographers use light in their work. You will probably need to switch to some more professional sources of lighting for your indoor photography. Again – be creative and you will win the war for the buyers' attention and buyers dollars!

5) Images format must be JPG at most sites, typically starting from 2 megapixels and with max file size of 8-10 MB

6) Properly prepare your images before uploading them to stock photo sites First of all it means digital editing. There are many software applications that can help you to edit your image, starting from the industry standard de-facto Adobe Photoshop tool, followed up by the newest and much cheaper than Photoshop Adobe Lightroom and ending up with Google's Picassa, which is very limited in its editing capabilities, but is available free of charge. Do your best editing your pixels. In many cases some light extra-saturation will help.

However, making your image look gorgeous is still not enough to create a bestselling picture. Think about buyers. Buyers still have to find your image among all the similar pictures in the web image database provided by a stock agency. It means you have to describe your image using appropriative keywords, title and description. It is important to do it before uploading images to a stock photo site, otherwise you will need to add keywords at every stock site, thus multiplying image preparation time.

Fortunately, keywords data can be inserted directly into JPG file, so the image carries its own keywords. This image metadata modification protocol is called IPTC and is implemented by some graphical applications, e.g. Adobe Photoshop. Editing IPTC data and selection of proper descriptive keywords can take significant amount of time, especially if English is not your mother tongue or if you just much better in taking pictures than in describing them in words. Buyers will never find your image if it was loosely keyworded, but the proper keywording and upload to multiple sites can take a while! Additionally, if you wish to keep the control what image was uploaded to which site and when, you might be completely lost after uploading a few tens of images.

Fortunately, there is dedicated stock photography management tool which takes care of all the issues above. ProStockMaster provides significant aid for a stock photographer by streamlining stock photography workflow. The application sports semi-automated images keywording, IPTC data editing, EXIF reading and provides simultaneous images upload to multiple leading stock photography agencies. ProStockMaster is available for free download from the product web site: http://www.prostockmaster.com. The free version is limited to 5 image uploads daily which certainly could be enough for many beginning stock photo submitters, saving them tens of hours of routine image preparation and management work in front of their computers.

7) Prices and payments – what income you can expect Most stock photography agencies pay photographers for each download (a purchase) made by the image buyer. This is a micro-payment model and the prices you get paid start as low as $0.20. However, if you were successful to create a real bestselling image you can easy hit few hundreds downloads a month, so your earning arithmetic can be $0.2 x 300 = $60 monthly for a single image. Shooting 10 bestsellers monthly could generate you $600 monthly income – definitely not a bad return on a few hours investment.

The rule of the thumb says the more images you have online in each and every stock photography agency the more images you sell and the higher monthly income you get. Typically, stock agencies send you a check or a PayPal transfer at the end of every month if you have earned more than a certain amount of cash, typically $100, during that month. Your earnings will be collected by the site until they reach this minimal payment.

Well, that's all folks! Just take your digital camera now and go for a shooting session. Oh, - wait!, wait a second. First, open your web browser and look what other people submit to stock photography agencies. Note the most popular images and agencies suggestions for stock content categories and keep these subjects in mind when you shoot. My personal advice? Avoid flowers close-ups, typical landscapes, city scenes and buildings. Try to materialize business terms and shoot pictures which represent them,e.g. 'success', 'failure', 'partnership'. Be always creative in your work and your pictures will become online bestsellers. Good luck and happy shooting!

Useful URLs:


Online stock agencies:
http://www.shutterstock.com/,
http://www.istockphoto.com/,
http://www.bigstockphoto.com/,
http://www.canstockphoto.com/,
http://www.fotolia.com/,

Bond estimate

Duration
What It Is:
Duration is a measure of a bond's sensitivity to interest rate changes. The higher the bond's duration, the greater its sensitivity to the change (also know as volatility) and vice versa.

How It Works/Example:
There is more than one way to calculate duration, depending on one's compounding assumptions, but the Macaulay duration (named after Frederick Macaulay, an economist who developed the concept in 1938) is the most common. The formula is:



where:

t = period in which the coupon is received
C = periodic (usually semiannual) coupon payment
y = the periodic yield to maturity or required yield
n = number periods
M = maturity value (in $)
P = market price of bond

The formula is complicated, but what it boils down to is: Duration = Present value of a bond's cash flows, weighted by length of time to receipt and divided by the bond's current market value. For example, let's calculate the duration of a three-year, $1,000 Company XYZ bond with a semiannual 10% coupon.

Period	Cash Flow	Period x Cash Flow	PV of $1 at 5%	Present Value of the Cash Flow
1	$50	$50	0.952	$47.62
2	$50	$100	0.907	$90.70
3	$50	$150	0.863	$129.58
4	$50	$200	0.822	$164.54
5	$50	$250	0.783	$195.88
6	$1,050	$6,300	0.746	$4,701.16
Total				$5,329.48

Notice in the table above that we first weighted the cash flows by the periods in which the occurred and then calculated the present value of each of these weighted cash flows (also, a measure of 5% is used instead of 10% because payments are semiannual).

To calculate the Macaulay duration, we then divide the sum of the present values of these cash flows by the current bond price (which we are assuming is $1,000):

Company XYZ Macaulay duration = $5,329.48 / $1,000 = 5.33

As mentioned earlier, duration can help investors understand how sensitive a bond is to changes in prevailing interest rates. By multiplying a bond's duration by the change, the investor can estimate the percentage price change for the bond. For example, consider the Company XYZ bonds with a duration of 5.53 years. If for whatever reason market yields increased by 20 basis points (0.20%), the approximate percentage change in the XYZ bond's price would be:

-5.53 x .002 = -0.01106 or -1.106%

Note that this is an approximation. The formula assumes a linear relationship between bond prices and yields even though the relationship is actually convex. Thus, the formula is less reliable when there is a large change in yield.

In general, six things affect a bond's duration:

Bond's Price
Note that if the bond in the above example were trading at $900 today, then the duration would be $5,329.48 / $900 = 5.92. If the bond were trading at $1,200 today, then the duration would be $5,329.48 / $1,200 = 4.44.

Coupon
The higher a bond's coupon, the more income it produces early on and thus the shorter its duration. The lower the coupon, the longer the duration (and volatility). Zero-coupon bonds, which have only one cash flow, have durations equal to their maturities.

Maturity
The longer a bond's maturity, the greater its duration (and volatility). Duration changes every time a bond makes a coupon payment. Over time, it shortens as the bond nears maturity.

Yield to Maturity
The higher a bond's yield to maturity, the shorter its duration because the present value of the distant cash flows (which have the heaviest weighting) become overshadowed by the value of the nearer payments.

Sinking Fund
The presence of a sinking fund lowers a bond's duration because the extra cash flows in the early years are greater than those of a bond without a sinking fund.

Call Provision
Bonds with call provisions also have shorter durations because the principal is repaid earlier than a similar non-callable bond.

Why It Matters:
Understanding the duration formula is not nearly as important as understanding that duration is a measure of risk because it has a direct relationship with price volatility. The greater duration of the bond, the greater its percentage price volatility.

By providing a way to estimate the affect of certain market changes on a bond's price, duration the investor can choose investments that will better meet his future cash needs. Duration also helps income investors who want to take on minimal interest rate risk (that is, they believe interest rates might fall) understand why they should consider bonds with high coupon payments and shorter maturities.

What is stock and bond?

What does it mean to own stock? Basically it means that a stock holder has a share in the company it holds stock in. In a sense the stockholders own a piece of the company that it has stock in. Stock shares are traded, bought and sold at a stock exchange such as the New York Stock Exchange which is the best known, but by no means the only stock exchange. Stocks are a type of security, Securities are instruments giving to their legal holders rights to money or other property. Securities include stocks, bonds, notes, mortgages,

How does one get to own stock? Usually stock is obtained through a stock broker. Let's say you wish to own a piece of Toys R Us or Coca-Cola. You would call a stock broker and he would tell you how much a share in the company would be. He would then place an order for the stock for you. When the stock is purchased, the broker would keep a stock certificate that shows that you are the legal owner of the stock until you choose to sell it.

What are the advantages of owning stock? One is that it allows the stock owner to share in the profits of a company. These profits come in the form of dividends, which are allocated according to how much stock one holds in the company. Of course one of the disadvantages is that one can lose money if a stock's price goes down.

What makes stock prices go up and down? There are many reasons: how much profit or loss a company has, the time of year, good or bad publicity about the company, how the economy is doing in general, etc..

There are several different kinds of stock. Preferred stock is a type of stock in which the stockholder gets a certain percentage of dividends each year based on the profits of the company. Common stockholders get dividends based on the remainder of the profits after preferred stockholders have been paid their dividends.

Another way to purchase stocks is through mutual funds. A mutual fund is an investment company that continually offers new shares and buys existing shares back at the request of the shareholder and uses its capital to invest in diversified securities of other companies. An investor puts money into a mutual fund and then the company invests the money on behalf of the investors.

What are bonds and how do they differ from stocks? A bond is a certificate of debt issued by a government or corporation guaranteeing payment of the original investment plus interest by a specified future date. Basically one is making a loan to the government or corporation and gets paid a sum of money in the future for letting the government or corporation borrow the money. Bonds are one way the government raises money besides taxes.