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Why are earning credit card rewards often tied to groceries and gas? | Every reward program has to have a funding source. If the card gives you x percent back on all purchases. That means that their business is structured to entice you to pump more transactions through the system. Either their other costs are lower, or the increased business allows them to make more money off of late fees... |
How can I find out what factors are making a stock's price rise? | A few days ago they launched Fannie Mae Guaranteed Multifamily Structures (link) but who knows? It's a penny stock now. Google Finance is pretty good at marking news right on the chart for a particular stock. That's how I tracked that piece of news down. Can't say that it precipitated a lot of people buying the stoc... |
CD interest rate US vs abroad, is there a catch? | If you invest in a foreign bank you are subject to their financial rules and regulations. If you put your money with their CD it will be converted to UAH (grivna) and you will be paid back in UAH, which introduces the exchange rate risk. FDIC is not the only reason why a CD in a US bank pays a lower interest, but it c... |
How does unemployment insurance work? | Unemployment insurance provides a temporary safety net to workers who lose their jobs by replacing a portion of their salary for certain periods. Each state administers its own unemployment insurance program so some rules may vary from state to state. To receive unemployment insurance payments, you must have lost your ... |
What does “interest rates”, without any further context, generically refer to? | Generically, interest rates being charged are driven in large part by the central bank's rate and competition tends to keep similar loans priced fairly close to each other. Interest rates being paid are driven by what's needed to get folks to lend you their money (deposit in bank, purchase bonds) so it's again related.... |
Why does the biotechnology industry have such a high PE ratio? | Most biotech companies do not have a product they are selling. They have a set of possible drugs that they are developing. If any of these drugs get proven to be better than the current drugs they can be sold at a great profit. Therefore as soon as a biotech company proves a drug candidate is likely to pass large... |
I earn $75K, have $30K in savings, no debt, rent from my parents who are losing their home. Should I buy a home now or save? | To be honest, if it's a home all of you share you should try and save the home for your parents. your 26, you will have plenty of time to make 30k again. Having a home headquarters will bring some security to the family. Not only that your parents are old now, it could be hard for them to get another home. They have sa... |
How to manage currency risk in international investing | Let's make a few assumptions: You have several ways of achieving (almost) that, in ascending complexity: Note that each alternative will have a cost which can be small (forwards, futures) or large (CFDs, debit) and the hedge will never be perfect, but you can get close. You will also need to decide whether you hedge th... |
For net worth, should I value physical property at my cost to replace it, or the amount I could get for selling it? | You are not asking for insurance purposes. So I'll go with this - I have two asset numbers I track. All investments, retirement accounts, etc, the kind that are valued at day's end by the market, etc. From that number I subtract the mortgage. This produces the number that I can say is my net worth with a paid in full h... |
What do the suffixes on stock symbols indicate | The suffix represents the stock exchange the stock is traded on. N represents the New York Stock Exchange and O represents the Nasdaq. Sometimes a stock can be listed on more than one exchange so the suffix will give you an indication of which exchange the stock is on. For example the Australian company BHP Billiton Lt... |
How to interpret a 1,372.55% dividend payout ratio (GSK)? | I don't think it makes sense to allow accounting numbers that you are not sure how to interpret as being a sell sign. If you know why the numbers are weird and you feel that the reason for it bodes ill about the future, and if you think there's a reason this has not been accounted for by the market, then you might thi... |
How much of each stock do index funds hold? | An index fund is just copying the definition of an index. The group that defines the index determines how to weight the different parts of the index. The index fund just makes sure they invest the same way the index creator wants. Think of a non-investment scenario. A teacher can grade tests, quizzes, homework, in-cla... |
Why would a company care about the price of its own shares in the stock market? | Shareholders get to vote for the board, the board appoints the CEO. This makes the CEO care, which in turn makes everybody else working in the company care. Also, if the company wants to borrow money a good share price, as sign of a healthy company, gives them more favorable conditions from lenders. And some more point... |
Will a credit card issuer cancel an account if it never incurs interest? | I've got a card that I've had for about 25 years now. The only time they charged me interest I showed it was their goof (the automatic payment failed because of their mistake) and they haven't cancelled it. No annual fee, a bit of cash back. The only cards I've ever had an issuer close are ones I didn't use. |
When are stock trade fees deducted? | Typically the fees are charged when the order is executed. The only catch I have ever ran into is when an order is partially executed. A good-till-cancel order that gets executed in several blocks over multiple days may get charged a separate commission for each day (but typically not each block). If this is a simple... |
Are variable rate loans ever a good idea? | Fixed You are confirming the amount you are going t pay over the term of the loan. Variable: 3.79% over 82mo. The total difference over the life of the loan comes to around $1200 That is the wrong way to calculate the variable portion. The variable is primarily set with a margin over a certain benchmark i.e. Fed rate.... |
Does an Executed Limit Order Imply a Spot Price? | I can't say I know everything about the underlying details, but from what I understand, your limit buy adds to the bid side of open orders, and one possibility is that someone placed a market order to sell when the bid price for the stock fell to $10 which was matched to your open limit order. So using your terminology... |
How to “pay” one self in a single member LLC w/ separate checking account? | Basically, yes. Don't use your business account for personal spending because it may invalidate your limited liability protection. Transfer a chunk of money to your personal account, write it down in your books as "distribution" (or something similar), and use it in whatever way you want from your personal account. The... |
Put a dollar value on pensions? | @JoeTaxpayer's answer outlines how to value it. Some other considerations: As I understand it, some public pensions may be tax-free if you still live in the state that is paying the pension. E.g. when a Massachusetts teacher receives pension, it is exempt from state taxes, but if that person moves to Vermont he will ha... |
What is the best use of “spare” money? | There's a hellova lot to be said for investing in real estate (simple residential real estate), even though it's grandma's advice. The two critical elements are 1) it's the only realistic way for a civilian to get leverage. this is why it almost always blows away "tinkering in the stock markets" in the 10-year frame. 2... |
How can I find a high-risk, high-reward investment that is not strongly correlated with the U.S. economy? | It requires fairly large levels of capital, but what about seed funding/angel investments in startups? This would be before venture capital gets involved, so the amounts are relatively low (tens of thousands, vs. millions of USD), but as valuations this early in the game are also low, you can get a significant portion ... |
Hedging against Exchange Rate Risk | You can calculate your exposure intuitively, by calculating your 'fx sensitivity'. Take your total USD assets, let's assume $50k. Convert to EUR at the current rate, let's assume 1 EUR : 1.1 USD, resulting in 45.5k EUR . If the USD strengthens by 1%, this moves to a rate of ~1.09, resulting in 46k EUR value for the sam... |
Can you explain “time value of money” and “compound interest” and provide examples of each? | Time Value of Money - The simple calculation for this is FV = PV * (1+r)^N which reads The Future Value is equal to the Present Value times 1 plus the interest rate multiplied by itself by the number of periods that will pass. A simple way to look at this is that if interest rates were 5%/yr a dollar would be worth (1.... |
What is the opposite of a hedge? | The opposite of a hedge is nothing. Because if you don't want to hedge you bets, you don't, therefore you merely have the original bet. The opposite state of being hedged, is being unhedged. |
Why don't more people run up their credit cards and skip the country? | I take it the premise of the question is that we're assuming the person isn't worried about the morals. He's a criminal out for a quick buck. And I guess we're assuming that wherever you go, they wouldn't arrest you and extradite you back to the U.S. As others have noted, you can't just walk into a bank the day you gra... |
Is equity research from large banks reliable? | If by "can we trust the analyst recommendations" you mean "are they right 100% of the time" the answer is absolutely no. Analysts are human and make mistakes, some more than others. There are many stories of "superstar managers" that make killings for several straight years, then have a few bad years and lose it all ... |
Does a stay at home mom need term life insurance? | Absolutely! Just because a spouse doesn't have a taxable income, doesn't mean they aren't providing real, tangible benefit to the family economy with an important job. As tragic as it is to consider losing your spouse, are you truly in a position to replace everything they do you for you? Knowing what they do for you... |
How come the government can value a home more than was paid for the house? | From my perspective I suspect that if the government use the paid price, people will start to buy at very low nominal prices in order to pay less taxes, and will repay the seller by other means. |
How can I legally and efficiently help my girlfriend build equity by helping with a mortgage? | A 30-yr mortgage IS a committment. So, you are willing to commit to a place, but not your long-term girlfriend??? Either you don't do this "cheap" scheme idea, or you set up as a business arrangement, or you get married. This is quite a laissez-faire statement you make... "Maybe we will eventually get married, maybe we... |
How does refinancing work? | Since there was no sale, where does the money actually come from? From the refinancing bank. It's a new loan. How does a bank profit from this, i.e. why would they willingly help someone lower their mortgage payments? Because they sell a new loan. Big banks usually sell the mortgage loans to the institutional investors... |
What percentage of my stock portfolio should be international (non-US) stocks? | Without knowing anything else about you, I'd say I need more information. If all of your investments are in stocks, then that's not really diversified, regardless of how many stocks you own. There are other things to invest in besides stocks (and bonds, for that matter). What countries? "International" is pretty broa... |
Track uninvoiced (pre-invoiced?) expected income in Quicken | You are right on track with your idea of setting up a separate account for invoiced income. Create a new account with the type other asset and call it "Receivables" (or something similar). Every time you invoice a client, enter a credit to this account with the amount of the invoice. Once the client pays and you deposi... |
I spend too much money. How can I get on the path to a frugal lifestyle? | Keep track of everything you buy. Write it down and be accountable. Try not to buy anything on credit cards, if the money is not in your account now then you can't afford it. Ask yourself whether what you're buying is a "need" or a "want". If you find that you are buying things because you are bored and you like sho... |
How would one follow the “smart money” when people use that term? | Smart money (Merriam-Webster, Wiktionary) is simply a term that refers to the money that successful investors invest. It can also refer to the successful investors themselves. When someone tells you to "follow the smart money," they are generally telling you to invest in the same things that successful investors inve... |
Calculating profits on a covered call. What method do you use? | yes, you are double counting. Your profit is between ($7.25 and $8) OR ($7.75 and $8.50). in other words, you bought the stock at $7.75 and sold at $8.00 and made $0.50 on top. Profit = $8.00-$7.75+$0.50 (of course all this assumes that the stock is at or above $8.00 when the option expires. If it's below, then your p... |
Is Investments by Bodie just an expanded version of Essentials of Investments? | They are actually both undergraduate texts; however, Investments is FAR more complex. Essentials of Investments really waters down the statistical and mathematical notation while Investments does not. Investments also has an entire section (4-5 chapters) called options, futures, and other derivatives while Essential... |
Do precious metals and mining sector index funds grow as much as the general stock market? | Metals and Mining is an interesting special case for stocks. It's relationship to U.S. equity (SPX) is particularly weak (~0.3 correlation) compared to most stocks so it doesn't behave like equity. However, it is still stock and not a commodities index so it's relation to major metals (Gold for instance) is not that ... |
is the bankruptcy of exchange markets possible? | You seem to think that stock exchanges are much more than they actually are. But it's right there in the name: stock exchange. It's a place where people exchange (i.e. trade) stocks, no more and no less. All it does is enable the trading (and thereby price finding). Supposedly they went into mysterious bankruptcy then ... |
Different ways of looking at P/E Ratio vs EPS | all other things being equal if you have two stocks, both with a P/E of 2, and one has an EPS of 5 whereas the other has an EPS of 10 is the latter a better purchase? What this really boils down to is the number of shares a company has outstanding. Given the same earnings & P/E, a company with fewer shares will ha... |
Where can I find announcements of official GDP figures for the US and other countries? | For immediate availability, by far the fastest (and cheapest) way to get macroeconomic figures as they are released, is by following (verified) Twitter accounts of the respective Central bank and institutions alike. Indeed, Twitter is the new trader tape. |
Why do financial institutions charge so much to convert currency? | Mainly because they can. Yes, there is a cost for banks to execute such transactions, and yes, there is a cost to cover the implied risks, but it is far from 3 or 4%. There are banks that charge a flat rate of less than 30$ (and no percentage), so for larger amounts, it is worth shopping around. Note that for smaller ... |
Are car buying services worth it? | Depends on how you value your time. These programs do not say they will get you the lowest basement price; they say you get a reasonable price without negotiation. This is true. Use a service. Pick out the car you want and spend less than an afternoon picking up your vehicle. You don't have to fret or do all of the... |
The equivalent of the standing order in the internet age for the UK specifically | A standing order is still the right way to do this. Most bank accounts have online access and will let your customer setup the standing order online, without having to fill in a paper form. |
Personal finance software for Mac that can track stocks and mutual funds? (Even manual updating of share prices will do.) | I'm using iBank on my Mac here and that definitely supports different currencies and is also supposed to be able to track investments (I haven't used it to track investments yet, hence the 'supposed to' caveat). |
If throwing good money after bad is generally a bad idea, is throwing more money after good Ok? | The principle behind the advice to not throw good money after bad is better restated in economics terms: sunk costs are sunk and irrelevant to today's decisions. Money lost on a stock is sunk and should not affect our decisions today, one way or the other. Similarly, the stock going up should not affect our decision... |
How do you measure the value of gold? | You acquire something because you expect to use it, or because you expect to exchange it for something that you want to use. Gold is a good candidate for storing value because it's rare, it's not easily counterfeited, it's divisible, it's portable, etc. Contrast this with your favorite currency: more can be printed u... |
How can I get a wholesaler ID number? | This is a state by state thing, and I'm cheating because I know you are in New York State: |
Can increasing my tax withholding from my full-time job cover FICA taxes for my freelance work? | Technically you owe 'self-employment' taxes not FICA taxes because they are imposed under a different law, SECA. However, since SE taxes are by design exactly the same rates as combining the two halves of FICA (employer and employee) it is quite reasonable to treat them as equivalent. SE taxes (and income tax also) are... |
Why would you not want to rollover a previous employer's 401(k) when changing jobs? | Another minor reason not to rollover would be to avoid the pro-rata taxes when doing a backdoor Roth IRA contribution. |
Historical Stock Price Quote on delisted stock without knowing stock symbol as of quote date | You need a source of delisted historical data. Such data is typically only available from paid sources. According to my records 20 Feb 2006 was not a trading day - it was Preisdent's Day and the US exchanges were closed. The prior trading date to this was 17 Feb 2006 where the stock had the following data: Open: 14.40... |
Tracking my spending, and incoming and outgoing (i.e cashflow) | Systems to research that may help you out: Less Accounting and Wave are great because they can import data from banks / credit cards. I know you said your bank doesn't export it but it seems like something as a small business you would want. |
What is the minimum age for early retirement | You can withdraw from CPP as early as 60. However, by doing so, you will permanently reduce the payments. The reduction is calculated based on average life expectancies. If you live for an average amount of time, that means you'll receive approximately the same total amount (after inflation adjustments) whether you sta... |
Why do volatility stocks/ETFs (TVIX, VXX, UVXY) trend down in the long-term? | There is more than a single reason why TVIX loses value over time. Futures curve. VIX is always expected to trend up when under 20(although this could change in the future). This means 1 month away futures contracts are bought at a premium closer to 20. If the .VIX stayed flat at 15, by the end of the month, that contr... |
How can a credit card company make any money off me? I have a no-fee card and pay my balance on time | Maybe they don't make much, but they make some for sure. In addition to what duffbeer703 says, they also have a warm body at the end of the line and will sell your contact info (or at least access to your eyeballs) to marketers. They stuff advertisements into your bill for example. If nothing else, you are brand valu... |
Return on asset (ROA) value for a stock is reported differently on Yahoo Finance and MarketWatch | Why there is this huge difference? I am not able to reconcile Yahoo's answer of 5.75%, even using their definition for ROA of: Return on Assets Formula: Earnings from Continuing Operations / Average Total Equity This ratio shows percentage of Returns to Total Assets of the company. This is a useful measure in analyzi... |
Can a company control its stock through contracts with stockholders? | Your first scenario, involving shareholders in a private corp being limited by a contractual agreement, is common in practice. Frequent clauses include methods of valuing the shares if someone wants to sell, first right of refusal [you have to attempt to sell to the other shareholders, before you can sell to a 3rd part... |
Is it legal to sell my stock at any specified price to a specified person in US Market? | So I want to sell my 100 shares of AAPL to him at a price of 10 or even 1 US Dollar. Is that legal/allowed? Of course. It's your stocks - do with it what you want. if the two persons are not served by a same broker. You'll have to talk to your broker about the technicalities of the transaction. if the person who sell... |
Will I be liable for taxes if I work for my co. in India for 3 months while I am with my husband in UK | For information about the UK situation, check the government website at http://www.hmrc.gov.uk/incometax/tax-arrive-uk.htm It all depends on the time. If I read it right (but you should check yourself) you can stay almost six months at a time, but at most 3 months on average over 4 years. Above this limit, you should ... |
What argument(s) support the claim that long-term housing prices trend upward? | Several people have mentioned the obvious: inflation. But let's assume we are talking about real (inflation adjusted) prices. One argument is that populations keep rising while the land does not change. So the price of homes in desirable places gets pushed up and people move to second-best locations, pushing those pr... |
Can I buy a new house before selling my current house? | You don't say why you want to move. Without knowing that, it is hard to recommend a course of action. Anyway... The sequence of events for an ECONOMICAL outcome in a strong market is as follows: (1) You begin looking for a new house (2) You rent storage and put large items into storage (3) You rent an apartment and mov... |
Car finance (loan) insurance requirements (store car) | Very generally speaking if you have a loan, in which something is used as collateral, the leader will likely require you to insure that collateral. In your case that would be a car. Yes certainly a lender will require you to insure the vehicle that they finance (Toyota or otherwise). Of course, if you purchase a ve... |
How to keep control of shared expenses inside marriage? | Why not start a third account, the "house" account? However you decide to fund it, equally or in proportion to income, you both chip in, and the payments for all joint expenses come from there. Rent, utilities, food, phone, cable. |
Is it a good idea to put everything in the S&P500? | What you choose to invest in depends largely on your own goals and time horizon. You state that your time horizon is a few decades. Most studies have shown that the equity market as a whole has outperformed most other asset types (except perhaps property in some cases) over the long term. The reason that time horizon... |
Frustrated Landlord | You are not a landlord. You have choices: The current situation is charity. And that's ok, so long as you acknowledge it. In the big picture, anything less than market rent is a gift that you are giving the person living in your house. A good tenant might keep the place in better shape, and deserve a lower rent, but t... |
Should I pay off my student loan before buying a house? | Paying off your student loan before buying a house is certainly a great risk reduction move for you. It will lower your debt to income ratio allowing your mortgage approval to go easier and it will free up more of your dollars to pay for the many miscellaneous projects that come with buying a house. I think that if you... |
If a company's assets are worth more than its market cap, can one say the shares must be undervalued? | You haven't mentioned how much debt your example company has. Rarely does a company not carry any kind of debt (credit facilities, outstanding bonds or debentures, accounts payable, etc.) Might it owe, for instance, $1B in outstanding loans or bonds? Looking at debt too is critically important if you want to conduct th... |
Can an IRA be taxed? | The Motley Fool article is correct that if you earn UBTI over $1000, you will need to pay the tax, even if held in an IRA. C-corps won't generate UBTI, so you're fine with those. For non-C-corps, the most common are REITs, MLPs, and BDCs. REITs These typically invest in either real estate property or mortgages. ... |
Will the stock market continue to grow forever? | The stock market may not grow "forever". There will be growth in the stock market, though. The stock market is a positive-sum game, since it is driven in large part by the profits earned by the companies. This doesn't mean that any individual stock will go up forever, it doesn't mean that any given index will go up for... |
Potential pitfalls of this volume trading strategy | First challenge: Creating a system which can understand written English well enough to read the news. Nothing short of IBM's Watson has proven very good at extracting meaning from unstructured text. Second challenge: By the time it reaches "the news", the big actors already know and have responded. Third challenge: It'... |
Do Americans really use checks that often? | I know this an old thread, but one that caught my interest as I just moved to the USA from Australia. As per the OP I had never written a check in my whole life, and upon arriving in the US I was surprised as to their proliference. In Australia pretty much all bills you receive can be paid in a number of ways: For sma... |
Do I even need credit cards? | A credit card can be a long running line of credit that will help to boost your FICO score. However if you have student loans, a mortgage, or car payments those will work just as well. If you ever get to the point where you don't have any recent lines of credit, this may eventually end up hurting your score, but until... |
How do I adjust to a new social class? | Under what conditions did you move? My favourite method of judging prices objectively comes from concepts written in Your Money or Your Life by Joe Dominguez. Essentially it normalizes money spent by making you figure out how much an item costs with respect to the number of hours you needed to work to afford it. I pref... |
Is it normal to think of money in different “contexts”? | Well, this relates to how you interpret something's value. We can use that magazine and restaurant as an example. For you the extra $10-$30 more on a decent meal or wine is worth it while $5 for a magazine entertainment on a train ride might not be. This is how all markets work, people make decisions about how they val... |
My company owed taxes for many years, An accountant asked me to ignore it and register a new one. Is it a right thing to do? | I think the first step is to get an accountant whose advice you believe. Your accountant is far better placed to advise you on what sounds like a fairly complicated, fairly high stakes corporate arrangement than the internet. I would go back to the accountant and get him to explain in writing what his specific advice ... |
Mortgage company withholding insurance proceeds | My question is, how do you rebuild a home, without the money to rebuild the home? I ignorantly thought that was why we paid for insurance. The reason that you have insurance is so as to keep the mortgage lender from losing money. That's why you buy the insurance through the mortgage lender and they get paid. Without ... |
Using P/E Ratio of an ETF to decide on asset mix | P/E is a useful tool for evaluating the price of a company, but only in comparison to companies in similar industries, especially for industries with well-defined cash flows. For example, if you compared Consolidated Edison (NYSE:ED) to Hawaiian Electric (NYSE:HE), you'll notice that HE has a significantly higher PE. ... |
What is the difference between a bad/bounced check and insufficient funds? | There is no difference they are both insufficient in 1 form or another.Bad slang for any check the bank won't cash, for any reason, Ie. insf. unreadable amount, acct or routing number, the acct.has been closed, or you didn't write the check(fraud). Bounced is slang for bank returned check unpaid.I wrote a bad check but... |
Recommendation on Options Back Testing tool please | As JoeTaxpayer says, there's a lot you can do with just the stock price. Exploring that a bit: Stock prices are a combination of market sentiment and company fundamentals. Options are just a layer on top of that. As such, options are mostly formulaic, which is why you have a hard time finding historical option data -- ... |
Need something more basic than a financial advisor or planner | In addition to a fee-only advisor, brought up by dg99, you could consider asking your questions on message boards such as Bogleheads.org. I have found the advice amazing, obviously conflict-free, and free. |
Estimated Tax on Unplanned Capital Gains | I'm assuming your talking USA. There are two ways to look. If you know you should pay on the cap gains, the best way to handle that separately from your salary is to file a quarterly tax payment. That, I understand, is what the self-employed have to do. I'm in the situation where at some point, probably this year, the... |
What prevents investors from buying high yield stocks and selling them as soon as their dividend is paid out? | This investment strategy may have tax advantages. In some countries, income received from dividends is taxed as income, whereas profits on share trades are capital gains. If you have already exceeded your tax-free income limit for the year, but not your capital gains tax allowance, it may be preferable to make a dealin... |
Claiming car as a business expense in the UK | I'm going to look just at purchase price. Essentially, you can't always claim the whole of the purchase price (or 95% your case) in the year (the accounting period) of purchase, but you get a percentage of the value of the car each year, called writing down allowance, which is a capital allowance. It is similar to depr... |
Debt collector has wrong person and is contacting my employer | Did you receive a summons, or other notice of proceedings, from the court which granted the judgement? If you were not served with the proceedings, contact the court. It is unlawful to enforce a judgement against someone who was not a party to the original lawsuit. |
Using a self-directed IRA to buy vacation condo, rent it out to an LLC for $1 | I don't quite understand your thought process here. First, in a tax-advantaged retirement account you are NOT allowed to engage in a transaction with yourself. If you just want to run a business and be able to write off expenses, how is using the self-directed IRA relevant? You can either buy the condo using your ta... |
Why do investors buy stock that had appreciated? | People buy stocks with the intention of making money. They either expect the price to continue to rise or that they will get dividends and the price will not drop (enough) to wipe out their dividend earnings. |
Why is OkPay not allowed in the United States? | The U.S. requires money transfer services to be licensed under 31 USC 5330 in addition to any applicable laws at the state level. According to multiple sources online, including the thread referenced by MD-Tech's answer, OkPay either cannot or will not get a license, so they are out. I dug on this a bit more because I... |
Employer 401K thru Fidelity - Investment options | The best predictor of mutual fund performance is low expense ratio, as reported by Morningstar despite the fact that it produces the star ratings you cite. Most of the funds you list are actively managed and thus have high expense ratios. Even if you believe there are mutual fund managers out there that can pick invest... |
Is it possible for all the owners of a stock to gain or lose money at the same time? | Take the case where a stock has just two owners, A and B, both at $10. One of them sells his shares to C, at $11. Now B has made $1 in profit but is no longer an owner of the stock. A hasn't sold anything but his shares are worth 10% more due to the last traded price printed. C has bought shares at $11 and the price i... |
Oversimplify it for me: the correct order of investing | All of the provided advice is great, but a slightly different viewpoint on debt is worth mentioning. Here are the areas that you should concentrate your efforts and the (rough) order you should proceed. Much of the following is predicated upon your having a situation where you need to get out of debt, and learn to bett... |
Should I negotiate a lower salary to be placed in a lower tax bracket? | No, absolutely not. Income tax rates are marginal. The tax bracket's higher tax rate only applies to extra dollars over the threshold, not to dollars below it. The normal income tax does not have any cliffs where one extra dollar of income will cost more than one dollar in extra taxes. Moreover, you are ignoring the... |
Do I owe taxes if my deductions are higher than my income? | In your case, I believe the answer is that you don't owe any taxes, if your deductions exceed your income. There is something called the Alternate Minimum Tax to catch "rich" people, who claim "too many" deductions. Basically, it taxes their "gross" income at a lower rate, but allows them no deductions if they make $17... |
Why does financial investor bother to buy derivatives and then hedge the position? | I don't know why a financial investor or a retail trader would do this. But I can guess why a market maker in options would do this. Let us say you buy an option from an option market maker and the market maker sold the option to you. He made a small profit in the bid-ask spread but now he is holding a short position i... |
Buying a small amount (e.g. $50) of stock via eToro “Social Trading Network” using a “CFD”? | Is eToro legitimate? If you have any doubts about eToro or other CFD providers (or even Forex providers, which are kind of similar), just type eToro scam in Google and see the results. |
Tax Allocation - Business Asset Transfer | And my CPA is saying no way, it will cost me many thousands in taxes and doesn't make any sense. I'd think so too. It looks like it converts from capitol gains at 14% to something else at about 35% Can be, if your gain under the Sec.1231 rules is classified as depreciation recapture. But, perhaps the buyers will be s... |
How do I choose 401k investment funds? | I disagree strongly with chasing expenses. Don't chase pennies until your are comfortable with an allocation that makes sense to you. Focus on building a diversified portfolio. Look at all of the funds, and put them in a portfolio in a tool like Google finance. Screen out funds with 1-3 stars. Search around on this sit... |
Any specific examples of company valuations according to Value Investing philosophy? | I highly recommend http://pages.stern.nyu.edu/~adamodar/ Professor Damodaran. He's written some of the best valuation books in existence (my favorite, simply "Investment Valuation"). On his website you'll find a big pile of spreadsheets, that are models for working the various approaches to valuing a company. Also, he... |
Why can't a US state default, but a EU state can? | But do you know about a US state risking to go default now or in the past? In 1847 four states - Mississippi, Arkansas, Michigan, and Florida - failed to pay all or some of their debts. All of these states had issued debt to invest in banks. From the detailed source listed below: "...it should be remembered that all... |
Analyze stock value | It seems like you want to compare the company's values not necessarily the stock price. Why not get the total outstanding shares and the stock price, generate the market cap. Then you could compare changes to market cap rather than just share price. |
How can I buy shares of oil? I'm told it's done through ETFs. How's that related to oil prices per barrel? | The papers you would need to buy are called 'futures', and they give you the right to buy (or sell) a certain amount of oil at a certain location (some large harbor typically), for a certain price, on a certain day. You can typically sell these futures anytime (if you find someone that buys them), and depending on the ... |
Should I pay off investment property mortgage | I would not recommend using your own money to pay off something that is not a strong asset. Use the savings where it will have the maximum return. Why not put (some of) the savings into another investment mortgage? Thanks to the leverage your return would be much higher than 5.5%, plus you would have more income. |
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