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Buying my first car out of college | I support the strategy to buy a less expensive car at the outset and then save for that more expensive car. You mentioned that you would be able to save $9000 by the time you had to start making payments. That sounds like a great budget for car shopping. For $9k you can get a dependable used car. If you find the right... |
If my put option reaches expiration on etrade and I don't log in to the site will it automatically exercise if it's in the money or be a total loss? | There are a number of choices: I prefer Dilip's response "Have you tried asking etrade?" No offense, but questions about how a particular broker handles certain situations are best asked of the broker. Last - one should never enter into any trade (especially options trades) without understanding the process in advance... |
What is the easiest way to back-test index funds and ETFs? | Back-testing itself is flawed. "Past performance is no guarantee of future results" is an important lesson to understand. Market strategies of one kind or another work until they don't. Edited in -- AssetPlay.net provides a tool that's halfway to what you are looking for. It only goes back to 1972, however. Just to tr... |
Should I sell my stocks when the stock hits a 52-week high in order to “Buy Low, Sell High”? | One possibility is to lock in gains by selling, where a selling price can attempt to be optimized by initiating a trailing stop loss order. You'll have to look at the pros and cons of that kind of order to see if it is right for you. Another possibility is to begin hedging with options contracts, if that security is op... |
What would happen if the Euro currency went bust? | Krugman (Nobel prize in Economy) has just said: Greek euro exit, very possibly next month. Huge withdrawals from Spanish and Italian banks, as depositors try to move their money to Germany. 3a. Maybe, just possibly, de facto controls, with banks forbidden to transfer deposits out of country and limits on cash withdra... |
Indian resident owning dividend-paying shares in company based in France: Can I save on withholding tax? | France taxes capital / dividend gains accrued in France. Hence you will not be able to reduce this liability. India does have a Double Tax Avoidance Treaty with France and you can claim relief for the tax paid in France. |
Is it better to use DRIP or invest when stock drops before ex-date? | Unless you suffer from the illusion that you can time the market, it honestly doesn't matter much; the difference is lost in the noise. That may be true even if you do suffer from that illusion. Also, as discussed here previously, the drop in a stock's price right after the dividend has been paid just reflects the fac... |
Super-generic mutual fund type | Since this is your emergency fund, you generally want to avoid volatility while keeping pace with inflation. You really shouldn't be looking for aggressive growth (which means taking on some risk). That comes from money outside of the emergency fund. The simplest thing to do would be to shop around for a different sa... |
Option on an option possible? (Have a LEAP, put to me?) | I can sell a PUT on it a bit out of the money, and I seemingly "win" either way: i.e. make money on selling the PUT, and either I get to pick up the stock cheaper if XYZ goes down, or the PUT expires worthless. In 2008, I see a bank stock (pick one) trading at $100. I buy that put from you, a $90 strike, and pay you $5... |
Am I entitled to get a maintenance loan? | According to GOV.UK, you can only apply for Student Finance if: Since you don't fulfill the criterion 2 and 3, you are technically not eligible for Student Finance. Since you have received information from Student Finance England that you can apply for the maintenance loan, you should either write to them or call them ... |
I'm about to be offered equity by my employer. What should I expect? | The main thing is the percentage of the company represented by the shares. Number of shares is meaningless without total shares. If you compute percentage and total company value you can estimate the value of the grant. Or perhaps more useful for a startup is to multiple the percentage by some plausible "exit" value, s... |
What are the advantages of paying off a mortgage quickly? | Considering that it's common for the monthly mortgage payment to be 25% of one's income, it's an obvious advantage for that monthly burden to be eliminated. The issue, as I see it, is that this is the last thing one should do in the list of priorities: The idea of 'no mortgage' is great. But. You might pay early and h... |
Are the guaranteed returns of regulated utilities really what they sound like? | No. That return on equity number is a target that the regulators consider when approving price hikes. If PG&E tried to get a 20% RoE, the regulator would deny the request. Utilities are basically compelled to accept price regulation in return for a monopoly on utility business in a geographic area. There are obviously... |
When does a pricing error become false advertising? | It's definitely annoying, but it's not necessarily false advertising. There is no rule or law that says they have to fix a pricing error at all, let alone within a certain period of time. Unfortunately they have no obligation to do business with you unless they take (and keep) your money. If they canceled the order and... |
Are buyouts always for higher than the market value of a stock? | Can a company not bargain with a dying company for example and buy a falling stock at lower than market value? Of course. If the shareholders agree to it. But why would they, if the market value is higher, agree to sell to someone who offers less? If there's a compelling reason - it can happen. It might happen during... |
Previous owner of my home wants to buy it back but the property's value is less than my loan… what to do? | How about doing a Lease Option with a very long term and a very early "option" for the guy buying. Essentially he will be making your mortgage payments for the next couple few years. Much less paperwork for the both of you that way. See a lawyer for the paperwork, from my limited experience with a real estate lawyer ... |
Where to park money while saving for a car | Bond aren't necessarily any safer than the stock market. Ultimately, there is no such thing as a low risk mutual fund. You want something that will allow you get at your money relatively quickly. In other words, CDs (since you you can pick a definite time period for your money to be tied up), money market account or j... |
Do people tend to spend less when using cash than credit cards? | First, let me answer the question the best way I can: I don't know if there are any studies other than those that have already been mentioned. Now, let's talk about something more interesting: You don't need to base your behavior on any study, even if it is scientific. Let's pretend, for example, that we could find a s... |
What are the advantages of paying off a mortgage quickly? | It depends on where you are in life, and where you want to be at some point in the future, and the taxes, expenses and income at those points in your life. You don't get a mortgage to save on taxes, or keep a mortgage to save on taxes. But if somebody said they want to have the house paid off before they retire, that s... |
Buy tires and keep car for 12-36 months, or replace car now? | If You use the car regulary, I don't think that driving on the bald tires for 3 years is a reasonable option. Have You considered buying used tires? Those will be cheaper and will last till You get to replace the car. |
What are my investment options in Australia? | If you want higher returns you may have to take on more risk. From lowest returns (and usually lower risk) to higher returns (and usually higher risk), Bank savings accounts, term deposits, on-line savings accounts, offset accounts (if you have a mortgage), fixed interest eg. Bonds, property and stock markets. If you ... |
Is there a term that better describes a compound annual growth rate (CAGR) when it is negative? | Not sure why CAGR is a problem for both directions. I used to be a physicist, and, when I taught classes in graduate school, students always wanted to use the terms "accelerate" and "decelerate" to describe "speeding up" and "slowing down". But acceleration is just a vector with magnitude and direction. There's nothing... |
Covered calls: How to handle this trade? | Your broker likely didn't close your position out because it is a covered position. Why interfere with a trade that has no risk to it, from their perspective? There's no risk for the broker since your account holds the shares available for delivery (definition of covered), for if and when the options you wrote (sold) a... |
How exactly is implied volatility assigned to an option's strike price? | As I understand it, Implied Volatility represents the expected gyrations of an options contract over it's lifetime. No, it represents that expected movement of the underlying stock, not the option itself. Yes, the value of the option will move roughly in the same direction the value of the stock, but that's not what ... |
Would I ever need credit card if my debit card is issued by MasterCard/Visa? | I was hoping to comment on the original question, but it looks to me like the asker lives in the EU, where credit cards are a lot less common and a lot of the arguments (car rental, building up of credit etc) brought forward by people living in the US just don't apply. In fact especially airlines (and other merchants)... |
Canadian personal finance software with ability to export historical credit card transactions? | Yodlee and Mint are good solutions if you don't mind your personal financial information being stored "in the cloud". I do, so I use Quicken. Quicken stores whatever you give to it for as long as you want: so the only question is how to get the credit card transactions you want into it? All my financial institutions al... |
Is there a rule of thumb to help “Sanity check” insurance costs? | Your best bet would be to find an independent Property and Casualty Insurance agent and buy through him/her. Insurance agents make a commission, yes - BUT - the cost to consumer is THE SAME whether you buy through an agent or through directly through the company. Any P&C agent would be happy to run your numbers for you... |
Why is day trading considered riskier than long-term trading? | But I don't see how it's any different than buying a stock at a low price and holding on to it for some months. Based on your question, I would say the difference is time. Day trading by its nature is a 6-hour endeavor. If you buy low and are planning to sell high, then you only have a few hours to make this happen. As... |
Why would you ever turn down a raise in salary? | If you have children in a university institution, then your annual salary is reported via financial aid forms. The small raise could be the difference between full tuition covered and only half tuition covered. |
Is compounding interest on investments a myth? | The S&P 500 index from 1974 to present certainly looks exponential to me (1974 is the earliest data Google has). If you read Jeremy Siegel's book there are 200 year stock graphs and the exponential nature of returns on stocks is even more evident. This graph only shows the index value and does not include the dividen... |
Is it normal for brokers to ask whether I am a beginner? | Brokers need to assess your level of competency to ensure that they don't allow you to "bite off more than you can chew" and find yourself in a bad situation. Some brokers ask you to rate your skills, others ask you how long you've been trading, it always varies based on broker. I use IB and they gave me a questionairr... |
How are mortgage payments decided? [duplicate] | It has nothing to do with forcing people to pay off their debt; in that case it would make better sense to have people pay off debt rather than interest. It is because you want to have your actual payment stay the same each month, which is easier for the vast majority of people to comprehend and put into their budget. ... |
Questrade - What happens if I buy U.S. stock with Canadian money? | The reason it's not automatic is that Questrade doesn't want to force you to convert in margin accounts at the time of buying the stock. What if you bought a US stock today and the exchange rate happened to be very unfavorable (due to whatever), wouldn't you rather wait a few days to exchange the funds rather than lose... |
Bucketing investments to track individual growths | Some personal finance packages can track basis cost of individual purchase lots or fractions thereof. I believe Quicken does, for example. And the mutual funds I'm invested in tell me this when I redeem shares. I can't vouch for who/what would make this visible at times other than sale; I've never had that need. For th... |
Cash flow implications of converting primary mortgaged residence to rental | You have some of the math right, but are missing a few things. Here's what I can offer - if I leave anything out, someone please expand or clarify. Rental income can be reduced by mortgage interest and maintenance costs (as you mentioned), but also by property tax payments, association fees, insurance costs, landlord e... |
What is the best source of funding to pay off debt? | You can take a out loan against your 401k, which means you won't be penalized for the withdrawal. You will have to pay that amount back though, but it can help since the interest will be lower than a lot of credit card rates. You could refinance your home if you can get a reasonable interest rate. You could also get a ... |
When would one actually want to use a market order instead of a limit order? | After learning about things that happened in the "flash crash" I always use limit orders. In an extremely rare instance if you place a market order when there is a some glitch, for example some large trader adds a zero at the end of their volume, you could get an awful price. If I want to buy at the market price, I ju... |
Short-sell, or try to rent out? | There is another option. Stay where you are. |
Starting long-term savings account as a college student | Great question and great of you to be paying attention to this. Right now having the ability to save $2K per year might seem very out of reach. However with the right career path and by paying attention to personal finance saving 2K per month will become possible sooner than you may think. As a student you are alread... |
Where do stock traders get realtime updates on Fed announcements? Is there a feed I could scrape? | Bloomberg terminal is a pretty standard way nowadays to get this information (and a lot more) pretty much in real time. |
Why do stock prices change? [duplicate] | As I understand it, a company raises money by sharing parts of it ("ownership") to people who buy stocks from it. It's not "ownership" in quotes, it's ownership in a non-ironic way. You own part of the company. If the company has 100 million shares outstanding you own 1/100,000,000th of it per share, it's small but ... |
How to deal with the credit card debt from family member that has passed away? | First, when a debt collector says, "It's to your advantage to give me money now", I'd take that with a grain of salt. My ex-wife declared bankruptcy and when debt collectors couldn't find her, they somehow tracked me down and told me that I should tell her that it would be to her advantage to pay off this debt before t... |
Is Volvo a public company? | There are two different companies named "Volvo." The publicly-traded company with ticker symbol VOLV-B is called Volvo Group, or AB Volvo. They primarily build trucks, buses, and construction equipment. The company that makes the Volvo branded cars is called Volvo Cars. It is a privately-held company currently owned ... |
What is vested stock and yearly dividends? | Vesting As you may know a stock option is the right to acquire a given amount of stock at a given price. Actually acquiring the stock is referred to as exercising the option. Your company is offering you options over 200,000 shares but not all of those options can be exercised immediately. Initially you will only be ... |
Understanding differences between S&P500 index-tracking ETFs | Regarding SPY: "One SPDR unit is valued at approximately 1/10 of the value of the S&P 500. Dividends are distributed quarterly, and are based on the accumulated stock dividends held in trust, less any expenses of the trust." (source) These are depository receipts, not the actual stocks. Regarding IVV: "The component ... |
What are the contents of fixed annuities? | For a variable annuity, you need to know the underlying investments and how your returns are credited to your account. For a fixed annuity, the issuer is responsible for the commitment to provide the promised rate to you. In a sense, how they invest isn't really your concern. You should be concerned about the overall h... |
Additional credit card with different limit on same account? | You can look into getting a business credit card. When I had my Chase business credit card, I could add authorized users to the main account and set a spending limit on each card. |
Why do people buy new cars they can not afford? | I would answer your question very simply: marketing works. "If you don't have a new F-150, you are not a real man." for men, and "If you don't have a new Honda Pilot your kids are in danger." for woman. One observation that reinforces this are the amount of new(er) Buicks on the road. Five years ago, they were prett... |
Indie Software Developers - How do I handle taxes? | I think the best advice you're going to get on the subject is: If you made $250k in half a year, you definitely have enough to hire an accountant! Get professional help on the subject, and they'll make sure you don't end up getting in any legal trouble. |
Merits of buying apartment houses and renting them | I’m not an expert on the VISA/US tax or insurance, but you're making enough mistakes in terms of all the associated costs involved in owning and renting houses/apartments that this already looks potentially unwise at this stage of your investment career. Renting cheap properties/to students involves the property consta... |
Should I buy a home or rent in my situation? | First, you are not a loser nor an idiot! You have avoided many debt mistakes and have a stable income. This move will be good for you and your family and an opportunity to continue to build your life together. The fact you are even thinking about this and asking questions shows that you are responsible. To your rent/bu... |
May I claim money earned but not received in 2012 | If you didn't receive the money in 2012 or have constructive receipt you really can't claim the income. If the company is going to give you a 1099 for the work they aren't going to give you one until next year and if you claim it this year you will have a hard time explaining the income difference. On the other hand if... |
I'm only spending roughly half of what I earn; should I spend more? | Keep saving or investing, but set aside a relatively modest amount for "fun money". That way, you can go have a good time without thinking too much about what you're spending within the limits you spend for yourself. You don't need to spend lavishly to have a good time! Not having the stress on your shoulders of worry... |
How are bonds affected by the Federal Funds Rate? | The federal funds rate is one of the risk-free short-term rates in the economy. We often think of fixed income securities as paying this rate plus some premia associated with risk. For a treasury security, we can think this way: (interest rate) = (fed funds rate) + (term premium) The term premium is a bit extra the bon... |
How a company in India can misuse my PAN number and its scanned copy that I provided as an interview candidate? | There is a possibility of misuse. Hence it should be shared judiciously. Sharing it with large / trusted organization reduces the risk as there would be right process / controls in place. Broadly these days PAN and other details are shared for quite a few transactions, say applying for a Credit Card, Opening Bank Accou... |
When does a low PE ratio not indicate a good stock? | Some companies have a steady, reliable, stream of earnings. In that case, a low P/E ratio is likely to indicate a good stock. Other companies have a "feast or famine" pattern, great earnings one year, no earnings or losses the following year. In that case, it is misleading to use a P/E ratio for a good year, when earni... |
Are in-kind donations from my S-Corp tax-deductible in any way? | You should probably have a tax professional help you with that (generally advisable when doing corporation returns, even if its a small S corp with a single shareholder). Some of it may be deductible, depending on the tax-exemption status of the recipients. Some may be deductible as business expenses. To address Chris'... |
How is Los Angeles property tax calculated if a 50% owner later buys out the other 50%? | When property changes hands the sale prices may or may not be used to determine the appraised value of the property, and they may or may not be used to determine the appraised value of other properties. Because of the nature of the transaction: you already have an existing business relationship, the local government is... |
Open Interest vs Volume for Stock Options | What if there is only one trading day and the volume is smaller than the open interest on that one trading day. This is assuming there is no open interest before that day? I pulled this from a comment. This can't happen. We have zero open interest on day one. On day 2, I buy 10 contracts. Volume is 10 and now open ... |
Friend was brainwashed by MLM-/ponzi investment scam. What can I do? | Chances are high your friend isn't in it for the money, but the community or some vague dream of having a future income-generating side business because he can't get a loan for a 7-11 franchise. I run a few successful online businesses and had an import/export so naturally I run into these guys looking for advice on se... |
How to convince someone they're too risk averse or conservative with investments? | I feel these beliefs can not be changed so easily. Once someone loses their money, how can you convince him? And on what ground can you convince him? Can you give a guarantee that investments will perform at a certain level? There are many people who are happy with low returns but highly safe instruments. They are not ... |
How to sell a stock in a crashing market? | What is essential is that company you are selling is transparent enough. Because it will provide additional liquidity to market. When I decide to sell, I drop all volume once at a time. Liquidation price will be somewhat worse then usual. But being out of position will save you nerves for future thinking where to step ... |
In general, is it financially better to buy or to rent a house? | An important factor you failed to mention is the costs associated with owning a home. For example, every 10 / 15 years, you have to replace your AC unit ($5k) and what about replacing a roof (depends on size, but could be $10k)? Not to mention, paying a couple thousand annually for property taxes. When renting, you ... |
Paying over the minimum mortgage payment | take a look at this graph here: http://mortgagevista.com/#m=1&a=40000&b=4&c=30y&B&oa&ob&oc&od It shows how much it costs to borrow $40k for 30 years. You did not post your mortgage rate or loan term, so I used 4% over 30 years (you can easily update this with your actual details). While this does not show the costs of ... |
What is buying pressure? | Buying pressure is when there are more buy orders than sell orders outstanding. Just because someone wants to buy a stock doesn't mean there's a seller ready to fill that order. When there's buying pressure, stock prices rise. When there's selling pressure, stock prices fall. There can be high volume where buying an... |
super confused about bid and ask size. help | The principle of demand-supply law will not work if spoofing (or layering, fake order) is implemented. However, spoofing stocks is an illegal criminal practice monitored by SEC. In stock market, aggressive buyer are willing to pay for a higher ask price pushing the price higher even if ask size is considerably larger ... |
Why do companies have a fiscal year different from the calendar year? | I can think of a few good reasons: A company, especially public, usually wants their fourth-quarter earnings to be the strongest of the year. That ends each fiscal year on a high note for the company and its investors, which helps public sentiment and boosts stock prices. So, travel agencies and airlines usually like e... |
What to do with a 50K inheritance [duplicate] | **I would encourage you to clear all your debts and remain debt free, then you can consult a financial manager-for investing purposes that fits your needs and goals. There are so many investment vehicles out, but the best of all is in real estate which requires lots of money. For your case I would prefer money marke... |
Is it a good practice to keep salary account and savings account separate? | In the United States, savings accounts generally have higher interest rates than checking or money market accounts. Part of this is the government restriction on the number of automated transactions per month that can be done on a savings account: this is supposed to allow banks to lengthen the time frame of the cash ... |
Are PINs always needed for paying with card? | Like email and spam, fighting creditcard fraud is a cat and mouse game, with technology and processes constantly being developed to reduce fraud. The CVV on the back of the card is just one more layer of security. Requiring the CVV generally requires you to physically have access to the card. CVV should not be stored ... |
What's the catch in investing in real estate for rent? | There are those who are knowledgable in real estate who offer rules of thumb: Don't pay more that 50X the rent for the house. Here, $972 x 50 is $48600. Assume half the rent goes to expenses. So from $972, you net $486, and after that mortgage, you have $111 in profit. Zillow usually assumes 20% down, here $20K. So you... |
What are the best software tools for personal finance? | Money Manager Ex PROS: CONS |
Canceling credit cards - insurance rate increase? | You can't ask insurers to use a particular score -- they have a state-approved underwriting model that they must follow consistently. Insurance companies make money by not paying claims, and poor credit score (including limit access to credit) increases the probability that you will file a small claim. Why? If you get ... |
How can I stop wasting food? | Try to choose less perishable items. Besides canned and bottled are adequate for some foods, and frozen foods for a wider range, such as vegetables and prepared foods. Dairy has a limited life, but some types live longer, like yogurt. Fruits like apples and oranges will last a good deal longer in the fridge (bananas... |
What is a good investment vehicle for introducing kids to investing? | There are mutual funds oriented toward kids or that are suitable in some way (e.g. they have low minimums). Here are two articles with mention of some of them: Of those only USAA First Start Growth is explicitly for kids: http://quote.morningstar.com/fund/f.aspx?t=UFSGX or https://www.usaa.com/inet/pages/mutual_funds_r... |
What's the difference between buying bonds and buying bond funds for the long-term? | Yes, bond funds are marked to market, so they will decline as the composition of their holdings will. Households actually have unimpressive relative levels of credit to equity holdings. The reason why is because there is little return on credit, making it irrational to hold any amount greater than to fund future liqui... |
Are personal finance / money management classes taught in high school, anywhere? | Did a little bit of digging, and found this article, from Staples High School in Westport, Connecticut. Hopefully this will be a growing trend. They say: A personal financial management class will now be offered at the beginning of the upcoming school year (2011-2012). According to the course catalogue, the focus of ... |
In what ways can a public company ask for money? | There are many different methods for a corporation to get money, but they mostly fall into three categories: earnings, debt and equity. Earnings would be just the corporation's accumulation of cash due to the operation of its business. Perhaps if cash was needed for a particular reason immediately, a business may cons... |
why do I need an emergency fund if I already have investments? | Let me first start by defining an emergency fund. This is money which is: Because emergency's usually need to be deal with ASAP, boiler breaks, gears box in a car. Generally you need these to be solved as soon as possible, because ou depend on these things working and you can't budget for this type of expenditure using... |
Is insurance worth it if you can afford to replace the item? If not, when is it? | In general, if you can afford to replace something, you are able to "self-insure". You really want to understand a little of the statistics before you can make a generic call, but my rule of thumb is that insurance via "extended warranty" is rarely a good deal. Here is a simple expected value math formula you can app... |
What is the difference between a 'trader' and a 'stockbroker'? | The traditional role of a stockbroker is to arrange for the buying and selling of stock by finding buyers and sellers at an agreed upon price. The broker does not purchase the stock for himself but merely arranges for the stock to be traded. A trader is one who purchases stock with the hope of selling it for a gain. ... |
Pensions, annuities, and “retirement” | With an annuity, you invest directly into an annuity with money you have earned as wages/salary/etc. You pay for it, and trade your payments into the annuity for guaranteed payments from the annuity issuer in the future. The more you pay in before the annuity payments begin, the more you will receive for your annuity p... |
Giving kids annual tax free gift of $28,000 | If the child is a dependent the question is moot. It is accepted that the parent will pay for some, most, or all of the tuition. There is no tax issue for a current student. The payment of tuition helps them qualify as a dependent. There is no need to transfer the money to the child's account; it can be sent directly t... |
Evidence for timing market in the short run? | The time horizon for your IRA is years or decades, therefore there is little evidence that there is a benefit to waiting for the "perfect time" to invest. Unless you plan on making only one or 2 years of investments now and then waiting till retirement; the other deposits you will make over the decades will have a gre... |
Why do 10 year-old luxury cars lose so much value? | They start at a higher price and repairs are more expensive than with a standard car. From my experience, many luxury cars get too expensive to keep after about 10 years due to increased maintenance costs. |
Open Interest vs Volume for Stock Options | For stock options, where I'm used to seeing these terms: Volume is usually reported per day, whereas open interest is cumulative. In addition, some volume closes positions and some opens positions. For example, if I am long one contract and sell it to someone who was short one contract, then that adds to volume and re... |
How smart is it really to take out a loan right now? | but I can't help but feel that these low rates are somehow a gimmick to trick people into taking out loans Let me help you: it's not a feeling. That's exactly what it is. Since the economy is down, people don't want to jeopardize what they have, and keep the cash in their wallets. But, while keeping the money safe in... |
Buy index mutual fund or build my own? | There are only three circumstances where building your own "index" portfolio make sense, in my opinion. |
Is it possible to borrow money to accrue interest, and then use that interest to pay back the borrower + fees? | With (1), it's rather confusing as to where "interest" refers to what you're paying and where it refers to what you're being paid, and it's confusing what you expect the numbers to work out to be. If you have to pay normal interest on top of sharing the interest you receive, then you're losing money. If the lending ban... |
What is the correct answer for percent change when the start amount is zero dollars $0? | I'd personally display "n/a" The only other answer that makes sense to me other is "infinity" (phone keyboard doesn't allow me to input the symbol). This would at least allow you to show direction by using positive and negative infinity and mathematical as the the initial value approaches zero the percentage change ap... |
Why could rental costs for apartments/houses rise while buying prices can go up and down? | I am from Australia, so my answer is based on my experience over here, however it should be similar for the USA. Generally, what determines both the price of houses/apartments and the rents for them is supply and demand. When there is high demand and low supply prices (or rents) generally go up. When there is low deman... |
Should I invest in a Health Insurance +1 policy from my Employer? | One thing to look into is if there is an extra fee for covering a spouse under you plan, if she is covered under her own employer's plan. I know that my wife's company charges around $100-$200 a year if I was to be covered under her plan, since I am eligible for the coverage where I work. As far as tax issues, there s... |
What is the effect of dividends on the futures price of an index | A futures contract is based upon a particular delivery date. In the case of a stock index futures contract is a cash settled futures contract based upon the stock index value at a particular point in time (i.e. this is when the final settlement is determined). In your example, the S&P 500 (SPX) is a price return index... |
How to prevent myself from buying things I don't want | There's a reason that you get a discount code: to make you feel like you're getting a deal. A deal is what you get when there was something that you were already going to buy, and you got it for a lower price than you were going to originally spend on it. If you learn to look at "rewards" as a marketing ploy that is de... |
How do financial services aimed at women differ from conventional services? | Less so today, but there was a time that women played a smaller role in the household finances, letting the husband manage the family money. Women often found themselves in a frightening situation when the husband died. Still, despite those who protest to the contrary, men and women tend to think differently, how they... |
Is there a benefit, long term, to life insurance for a youngish, debt, and dependent free person? | Term life insurance for a healthy 30 year old is a heck of a lot cheaper than for a 40 year old who's starting to break down (and who needs the coverage since he's got a spouse and kids). So, get a long term policy now while it's cheap. |
Why would someone buy a way out-of-the-money call option that's expiring soon? | I think the best answer that doesn't make the buyer look like a moron is this. Buyer had previously sold a covered call. They wanted to act on a different opportunity so they did a closing buy/write with a spread of a couple cents below asking for the stock, but it dipped a couple cents and the purchase of those optio... |
Is there data and proof that a diversified portfolio can generate higher returns than the S&P 500 Index? | While it's definitely possible (and likely?) that a diversified portfolio generates higher returns than the S&P 500, that's not the main reason why you diversify. Diversification reduces risk. Modern portfolio theory suggests that you should maximize return while reducing risk, instead of blindly chasing the highest r... |
Why do deep in the money options trade below their intrinsic value? | You made 94$ on an investment of 554.80 *100 = 55480$ for an approx holding period of 1 year. So the % return is ~0.16%, which is not much better than the short term us treasury rate. The current 1 year treasury rate is 0.27%: http://ycharts.com/indicators/1_year_treasury_rate So yes, you have a risk free portfolio, so... |
Why is everyone saying how desperately we need to save money “in this economy”? | This was called Financial repression by Edward S. Shaw and Ronald I. McKinnon from Stanford (https://en.wikipedia.org/wiki/Financial_repression). Financial repression is the situation, when government is stealing from people, who rely heavily on saving, rather then on spending. Meaning that your saving rates will be a ... |
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