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New to investing — I have $20,000 cash saved, what should I do with it? | As @mbhunter says, make sure you pay off any debt you have first. Then, it's a good idea to keep some or all of your savings as an emergency fund. If you use every last dime to pay for a house, you'll have no cushion available when something breaks down. The most common recommendation I've seen is to have 3-6 months... |
Is it a good investment for a foreigner to purchase a flat/apartment in China? | More infomation is needed for any meaningful discussion about this. I just assume you want to buy in China mainland, not Hongkong or other places. That depends on where you want to buy the flat. Which city, which district of the city, which community, which school district, how old is the building? Furthermore, alwa... |
Are multiple hard inquiries for a specific loan type okay? | tl;dr: Your best course of action is probably to do a soft pull (check your own credit) and provide that to the lender for an unofficial pre-approval to get the ball rolling. The long of it: The loan officer is mostly correct, and I have recent personal evidence that corroborates that. A few months ago I looked into re... |
Is keeping track of your money and having a budget the same thing? | A budget is a plan for spending money in the future. Tracking spending is only looking at what happened in the past. Many people only track their spending, a proper budget can be key to achieving financial goals. You might earn enough and not spend frivolously enough that you aren't hamstrung by lack of a budget, but ... |
Are cashiers required to check a credit card for a signature in the U.S.? | Per their merchant agreements, Visa and MasterCard say that the signature on the back of the card is the proper way to identify the card holder. If a card is not signed, the merchant is supposed to check your ID and make you sign the card before accepting it for payment. Merchants are not allowed the require an ID fo... |
Can a US bank prevent you from making early payments to the principal on a home mortgage? | Some lenders want to discourage the borrower from making these additional payments because they want to sell this as a service. They might set this up for you, or they have a contract with a 3rd party to set it up. These services generally charge you to initiate the process, and may have a recurring fee. They take 1/2 ... |
When to sell a stock? | Keep a diary, before buying write down why are you buying the stock, how long do you plan to keep it. Put down reasons when you would sell it. For example you buy a stock because it has lot of cash reserve, it is a focused company, good management. You would sell when management leaves or it starts to use its cash for ... |
Do I have to pay a capital gains tax if I rebuy different stocks? | Yes (most likely). If you are exchanging investments for cash, you will have to pay tax on that - disregarding capital losses, capital loss carryovers, AGI thresholds, and other special rules (which there is no indication of in your question). You will have to calculate the gain on Schedule D, and report that as income... |
Company A is buying company B, what happens to the stock? | It depends on the timing of the events. Sometimes the buying company announces their intention but the other company doesn't like the deal. It can go back and forth several times, before the deal is finalized. The specifics of the deal determine what happens to the stock: The deal will specify when the cutoff is. Some ... |
tax deduction for 30k loan | The loan itself is not tax deductible; unless you took it as part of a mortgage, anyway, it's just a regular loan. Mortgage and Student Loan Interest deductions are special cases explicitly given tax-deductible status; other loans are not deductible (unless part of a business expense or other qualifying reason). If th... |
Looking to buy a property that's 12-14x my income. How can it be done? | It is your choice to have "insignificant income", and that has consequences. One is that you cannot borrow money to purchase a home independent of your credit score. In order to purchase a home you must also have the ability to repay in addition to a good history. IMHO your question suggest that you have a unrealisti... |
15 year mortgage vs 30 year paid off in 15 | Consider the "opportunity cost" of the extra repayment on a 15 year loan. If you owe money at 30% p.a. and money at 4% p.a. then it is a no brainer that the 30% loan gets paid down first. Consider too that if the mortgage is not tax deductable and you pay income tax, that you do not pay tax on money you "save". (i.e. ... |
Which online services offer logarithmic charts for equities such as index funds and ETFs? | The charts on nasdaq.com are log based, if you look closely you can see that the spacing between evenly incremented prices is tighter at the top of the chart and wider at the bottom. It's easiest to see on a stock with a wide price range using candlestick where you can clearly see the grid. I'm also not seeing the "... |
Is it possible to buy UK Consols (perpetuities)? | Selftrade does list them. Not sure if you'll be able to sign up from the US though, particularly given the FATCA issues. |
Investing small amounts at regular intervals while minimizing fees? | I am not sure whether this hold in all countries, but at least in the Netherlands my bank allows for investment in funds without charging transaction costs. The downside is that these funds charge an annual fee of about 1%, but for the amounts you are talking about this definitely sounds more attractive than the altern... |
Are traders 100% responsible for a stock's price changes? | Yes, the value of a stock is completely, 100% determined by what people are willing to pay for it in conjunction with what people who have it are willing to sell it for. If something really bad happened to a company, like their only factory burned to the ground, and the traders didn't care, then I guess, in that scenar... |
Top 3 things to do before year end for your Stock Portfolio? | Bonus: Contribute to (or start!) your IRA for 2010. This doesn't have to be done have to be done by the end of the year; you can make your 2011 contribution in 2010, before you file your tax return (by Apr. 15 at the latest, even if you get an extension.) |
What evidence or research suggests that mid- or small-capitalization stocks should perform better than large caps? | I think it's safe to say that Apple cannot grow in value in the next 20 years as fast as it did in the prior 20. It rose 100 fold to a current 730B valuation. 73 trillion dollars is nearly half the value of all wealth in the world. Unfortunately, for every Apple, there are dozens of small companies that don't survive.... |
Is it worth having a pension? | On the face of it, it doesn't look like a very good deal - neither pension not annuity company are in it for the fun of it, so they'll take their cut from your money, and then invest it anyway. The rest depends on what they promise you - if they just promise you market returns then I don't see much sense to do it, you ... |
Can a broker refuse to place my limit-orders? | Ethereum trades are not subject to the same rules as securities are. Thats the primary flaw in your assessment. Yes, cryptocurrency is a free trading arena where you can actually take advantage of market inefficiencies yourself 24 hours a day, 7 days a week, at massive profits. The equity securities markets are not lik... |
How can I borrow in order to improve a home I just bought? | It depends on your equity(assets - liabilities). If you have a lot of equity, banks will be happy to lend you money because they now they can always seize your assets. If you don't have a lot of equity another option is to go to hard money lenders. They charge high rates and some of them lend-to-own, but is an option.... |
Is there a tax deduction for renting office space in service of employer? | According to this post on TurboTax forums, you could deduct it as an "Unreimbursed Employee" expense. This would seem consistent with the IRS Guidelines on such deductions: An expense is ordinary if it is common and accepted in your trade, business, or profession. An expense is necessary if it is appropriate and helpfu... |
Better approach to close loans? | It is typically best to pay minimum payments to 2 of the loans and pay aggressively on the third loan. Some will tell you to pay the highest interest rate loan off first because "personal finance" is about "finance" and mathematically that saves you the most interest. Some will tell you to pay the smallest balance loan... |
Purpose of having good credit when you are well-off? | Your dad may have paid an "opportunity cost" for that outright purchase. If the money he saved had been invested elsewhere, he may have made more money. If he was that well off, then his interest rate should have been the lowest possible. My own father is a multi-millionaire (not myself) and he could afford to have ... |
Do I need a business credit card? | It can certainly help build a credit score, but remember that businesses gain credit differently from individuals. Depending on the country, there isn't usually a national register of business credit ratings the way there is for individuals. The credit record you'd be gaining is with your own bank only. Banks will us... |
Why do stores and manufacturers use mail in rebates? A scam, or is there a way to use them effectively? | Rebates are a great way to give discounts to customers who are cost sensitive. A long time ago, I worked for a retailer that extensively used rebates as a marketing tool. From my point of view, about 90% of the complaints that I investigated were a result of people not following directions. Biggest single thing was not... |
Shorting stocks: Indicators that a stock will drop? | First utilize a security screener to identify the security profiles you are looking to identify for identifying your target securities for shorting. Most online brokers have stock screeners that you can utilize. At this point you may want to look at your target list of securities to find out those that are eligible ... |
What is the difference between equity and assets? | Not to detract from the other answers at all (which are each excellent and useful in their own right), but here's my interpretation of the ideas: Equity is the answer to the question "Where is the value of the company coming from?" This might include owner stakes, shareholder stock investments, or outside investments.... |
Which dividend bearing stock should be chosen by price? | A 20% dividend yield in most companies would make me very suspicious. Most dividend yields are in the 2-3% range right now and a 20% yield would make me worry that the company was in trouble, the stock price had crashed and the dividend was going to be cut, the company was going to go out of business or both. |
Vanguard Target Retirement Fund vs. Similar ETF Distribution (w/ REIT) | Your approach sounds solid to me. Alternatively, if (as appears to be the case) then you might want to consider devoting your tax-advantaged accounts to tax-inefficient investments, such as REITs and high-yield bond funds. That way your investments that generate non-capital-gain (i.e. tax-expensive) income are safe f... |
Multiple accounts stagnant after quitting job. | You ask multiple question here. The 401(k) - move it to an IRA. As others stated,this will lower your costs, and open up a potential I didn't see mentioned, the conversion to a Roth IRA. A year in which your income is lower than average is a great opportunity to convert a bit of the IRA enough to "top off" the lower b... |
What do people mean when they talk about the central bank providing “cheap money”? What are the implications for the stock market? | Companies with existing borrowings (where borrowings are on variable interest rates) or in the case with fixed interest rates - companies that get new borrowings - would pay less interest on these borrowings, so their cost will go down and profits up, making them more attractive to investors. So, in general lower inte... |
When will the U.K. convert to the Euro as an official currency? | Not anytime soon, I suspect, but not necessarily for financial reasons. I found this interesting, including the link to the five tests, but I think that this topic is only partially judged through financial eyes, there's a lot of political issues around this with national identity/immigration issues already in the spot... |
I can make a budget, but how can I get myself to consistently follow my budget? | Do a monthly budget, unique to each month, before the month begins, spend all of your money on paper. Use envelopes to help you keep track of how much you have left for things you buy throughout the month. Have separate envelopes for things like groceries, restaurants, clothing, entertainment. Put the amount of money f... |
Indian citizen working from India as freelancer for U.S.-based company. How to report the income & pay tax in India? | You can receive money directly into your savings bank account. It is perfectly legal. FYI the Bank as part of regulation would report this to RBI. As the funds are received for the services you have rendered, You are liable to pay tax on the income. The income is taxed as professional income similar to the income of Do... |
How do I find an ideal single fund to invest all my money in? | First, decide on your asset allocation; are you looking for a fund with 60% stocks/risky-stuff, or 40% or 20%? Second, look for funds that have a mix of stocks and bonds. Good keywords would be: "target retirement," "lifecycle," "balanced," "conservative/moderate allocation." As you discover these funds, probably the f... |
Why Gamma is highest for an option that is at the money | Yes, you've got it right. The change in price is less meaningful as the instrument is further from the price of the underlying. As the delta moves less, the gamma is much less. Gamma is to delta as acceleration is to speed. Speed is movement relative to X, and acceleration is rate of change in speed. Delta is movem... |
How does a bank make money on an interest free secured loan? | Very good answers as to how 0% loans are typically done. In addition, many are either tied to a specific large item purchase, or credit cards with a no interest period. On credit card transactions the bank is getting a fee from the retailer, who in turn is giving you a hidden charge to cover that fee. In the case of... |
Can I profit from anticipating a drop in value? | To summarize, there are three basic ways: (3) is the truly dangerous one. If there is a lot of short interest in a stock, but for some reason the stock goes up, suddenly a lot of people will be scrambling to buy that stock to cover their short position -- which will drive the price up even further, making the problem w... |
What are some signs that the stock market might crash? | There are some economic signs as there are in all economic and business cycles, such as interest rates rising. However, a more effective way is to actually look at price action itself. The definition of an uptrend is higher highs followed by higher lows. The definition of a downtrend is lower lows followed by lower hig... |
Should you co-sign a personal loan for a friend/family member? Why/why not? | Yes, there are times when co-signing is the right choice. One is when you know more about the person than the loan issuer does. Consider a young person who has just started working in a volatile field, the kind of job where you can be told on Friday that you only get one shift next week but things might pick up the wee... |
Can a buy market order be matched with a sell market order in Forex trading? | If there are no limit orders on the opposite side of the book when your market order gets its turn for execution, it should be rejected by the market. A market order should generally not "sit on the book" like your question suggests waiting for another order to arrive. Thus, the situation that you describe should not... |
What if you get pre-approved for a mortgage but don't find a house in the pre-approval timeframe? | As mentioned before - you're over-thinking the hard-pull issue. But do try to make the preapproval as close to the actual bidding as possible - because it costs money. At least from my experience, you'll get charged the application fee for preapproval, while "pre-qualification" is usually free. If you're seriously shop... |
Can you lease a secondary residential apartment for a job in NYC, and declare it as expense in tax return? | As I understand it... Generally housing can't be considered a business expense unless taken at your employer's explicit direction, for the good of the business rather than the employee. Temporary assignment far enough from you home office that commuting or occasional hotel nights are impractical, maybe. In other word... |
How can risk-reward relationship exist, since the losses due to the risk should offset the reward? | Risk in finance is defined as standard deviation of returns. This is a measure of size of your returns, both negative and positive. Since the mean return is positive (at least for the stock market and fixed income), if you double the standard deviation your mean return also doubles along with it. In this way you are co... |
What do Earnings Per Share tell potential shareholders? | Earnings per share is the company profit (or loss), divided by the number of outstanding shares. The number should always be compared to the share price, so for instance if the EPS is $1 and the share price is $10, the EPS is 10% of the share price. This means that if the company keeps up this earning you should expect... |
Why are currency forwards needed? | Suppose you're a European Company, selling say a software product to a US company. As much as you might want the US company to pay you in Euros they might insist (or you'll lose the contract) that you agree pricing in USD. The software is licensed on a yearly recurring amount, say 100K USD per year payable on the 1st ... |
How much can I withdraw from Betterment and be considered long-term investment? | This question and your other one indicate you're a bit unclear on how capital gains taxes work, so here's the deal: you buy an asset (like shares of stock or a mutual fund). You later sell it for more than you bought it for. You pay taxes on your profit: the difference between what you sold it for and what you bought... |
Is there a free, online stock screener for UK stocks? | AdvFN has one--click the Charts & Research pulldown and choose UK Screener. Free but requires login. |
Do Fundamentals Matter Anymore in Stock Markets? | Are you implying that Amazon is a better investment than GE because Amazon's P/E is 175 while GE's is only 27? Or that GE is a better investment than Apple because Apple's P/E is just 13. There are a lot of other ratios to consider than P/E. I personally view high P/E numbers as a red flag. One way to think of a P/... |
What to do when a job offer is made but with a salary less than what was asked for? | It depends on your situation. Take the job only if you really need the job and there's no job close to your experience and salary expectations. IMO $70K is not much in NYC given the cost of living there, even if you stay in Jersey City, NJ and take a train. However, it does depend on your lifestyle. Also, if HR is not ... |
How to get rid of someone else's debt collector? | Sue the debt collectors in small claims court. There are several example stories around the internet, but this is a well written one from the consumerist. If your phone is a cell phone: "it is against the law for a company to leave a pre-recorded message on your cell phone." In fact, the call frequency increased ... |
Why would anyone want to pay off their debts in a way other than “highest interest” first? | There are a number of bona fide reasons to consider here. If there is a cost to discharging a security packet, or a mortgage, it may not be convenient if we are advanced in the repayment schedule. Early exit fees may apply, or the interest may be "pre-determined". As a rule of thumb, when we are talking about rates abo... |
Why do governments borrow money instead of printing it? | The government could actually do either one to expand the money supply as necessary to keep up with rising productivity / an increased labor supply. The question is merely political. In the case of the US, printing money involves convincing politicians to spend it. While we currently run a deficit, there is a large l... |
What would happen if the Euro currency went bust? | These rumors are here just to help dollar stay alive. Euro have problems, but they are rather solvable, unlike dollar situation. Even if something wrong would happen - countries would return to their national currencies, mainly Germany & France are important here. This does not means that EuroUnion would be destroyed -... |
Tax for Basket with Coupon containing two different VAT rates | The vendor needs to do this using apportionment, according to the VAT rules for mixed supplies: If you make mixed supplies and the individual supplies are not liable to VAT at the same rate then you need to work out the tax value of each supply in order to calculate how much tax is due. If the tax value is based ... |
Can banks deny that you've paid your loan? | Maybe there's more to this story, because as written, your sister seems, well, a little irrational. Is it possible that the bank will try to cheat you and demand that you pay a loan again that you've already paid off? Or maybe not deliberately cheat you, but make a mistake and lose track of the fact that you paid? Sure... |
How and why does the exchange rate of a currency change almost everyday? | The basic idea is that money's worth is dependent on what it can be used to buy. The principal driver of monetary exchange (using one type of currency to "buy" another) is that usually, transactions for goods or services in a particular country must be made using that country's official currency. So, if the U.S. has so... |
Why should a company go public? | The purpose is to go public but also to generate more wealth. The real money comes when market values you at a price more than your cash flow. If a company brings in $1000 of cash flow, then that is what the employees and owners have to distribute among themselves. But if they are likely to increase to $2000 next and $... |
Do I even need credit cards? | Credit cards are great. You get free money for 30+ days and a bunch of additional benefits like insurance, extended warranties and reward programs. When vendors don't behave, you dispute the charge with the credit card and they deal with it on your behalf. Just get a fee-free American Express card and pay the balance o... |
W-4 was not updated when moving from part-time to full-time, still showed Tax-Exempt. What happens now? | Legally, do I have anything to worry about from having an incorrectly filed W-4? What you did wasn't criminal. When you submitted the form it was correct. Unfortunately as your situation changed you didn't adjust the form, that mistake does have consequences. Is there anything within my rights I can do to get the compa... |
Where to find Vanguard Index Funds? | You cannot actually buy an index in the true sense of the word. An index is created and maintained by a company like Standard and Poor's who licenses the use of the index to firms like Vanguard. The S&P 500 is an example of an index. The S&P 500 "index includes 500 leading companies", many finical companies sell pro... |
The best credit card for people who pay their balance off every month | I'm not going to recommend a specific card. New card offers pop up all the time. My answer would be out of date in a month! As a general rule, if you pay off your balance every month, you should be looking at a cash-back or a rewards card. Cash-back cards will give you some money (say 1%) of every dollar you spend. ... |
Why is the bid-ask spread considered a cost? | As an aside, on most securities with a spread of the minimum tick, there would be no bid ask spread if so-called "locked markets", where the price of the best bid on one exchange is equal to the price of the best ask on another, were permitted. It is currently forbidden for a security to have posted orders having the s... |
Would I ever need credit card if my debit card is issued by MasterCard/Visa? | Skimmers are most likely at gas station pumps. If your debit card is compromised you are getting money taken out of your checking account which could cause a cascade of NSF fees. Never use debit card at pump. Clark Howard calls debit cards piece of trash fake visa/mc That is because of all the points mentioned abo... |
Should I buy a house because Mortgage rates are low | Reasons for no: In your first sentence you say something interesting: rates low - prices high. Actually those 2 are reversely correlated, imagine if rates would be 5% higher-very few people could buy at current prices so prices would drop. Also you need to keep in mind the rate of inflation that was much higher durin... |
How are the best way to make and save money at 22 years old | Determine how much you are going to save first. Then determine where you can spend your money. If you're living with your parents, try to build an emergency fund of six months income. The simplest way is to put half of your income in the emergency fund for a year. Try to save at least 10% of your income for retire... |
How to invest for the event of a US default? | If the US economy crashes at all suddenly, the global economy goes with it. In that case, yes, the postapocalyptic scenarios may be the best answer. But that's got so low a probability of happening that you'd be a fool to invest in it. If you really feel the need, consider investing in the companies which supply those ... |
Beginner dividend investor - first steps | Question 1: How do I start? or "the broker" problem Get an online broker. You can do a wire transfer to fund the account from your bank. Question 2: What criticism do you have for my plan? Dividend investing is smart. The only problem is that everyone's currently doing it. There is an insatiable demand for yield, no... |
When is Cash Value Life Insurance a good or bad idea? | Buy term and invest the difference is certainly the standard recommendation, and for good reason. When you start looking at some sample numbers the "buy term and invest the difference" strategy starts to look very good. Here are the rates I found (27 yr old in Texas with good health, non-smoker, etc): $200k term life: ... |
In US, is it a good idea to hire a tax consultant for doing taxes? | 75k is short of the 'highly compensated' category. Most US citizens in that pay range would consider paying someone to do their taxes as an unnecessary expense. Tax shelters usually don't come into play for this level of income. However, there are certain things which provide deductions. Some things that make it bet... |
Buy tires and keep car for 12-36 months, or replace car now? | I don't see how anyone could give you a hard-and-fast formula, unless they know where to get some applicable statistics. Because several factors here are not a straight calculation. If you don't replace the tires but keeping driving the car, what is the increased probability that you will get into an accident because o... |
If I exercise underwater ISOs, can I claim a loss? | If you do this, you own a stock worth $1, with a basis of $2. The loss doesn't get realized until the shares are sold. Of course, we hope you see the stock increase above that price, else, why do this? |
Why would people sell a stock below the current price? | I stock is only worth what someone will pay for it. If you want to sell it you will get market price which is the bid. |
Why are Rausch Coleman houses so cheap? Is it because they don't have gas? | They are cheap because they are made from cheap material. All the homes in my addition are Ruasch Coleman and a lot of them are having issues (Oklahoma). Several are around 5 years old and have already had to get new roofs. On our neighborhood FB page there have been complaints with the plumbing system and flooding ... |
Should my retirement portfolio imitate my saving portfolio? | Short Answer: Length of Time invested and risk should be correlated. From what I am hearing this is pretty good game plan for your age. Minutia: Once you get closer to retirement lets say in 20 years. You might want to treat two lumps of money with different risk. For me at 49 I have a lump of money for 55-70 that ... |
Company revenue increased however stock price did not | The company released its 2nd Quarter Revenue of $1,957,921 a couple days ago however the stock did not move up in any way. Why? If the company is making money shouldn't the stock go up. But that result doesn't indicate that the company is making money. The word for making money is profit, not revenue. Profit equals r... |
How to start personal finances? | A few practical thoughts: A practical thing that helps me immensely not to loose important paperwork (such as bank statements, bills, payroll statement, all those statements you need for filing tax return, ...) is: In addition to the folder (Aktenordner) where the statements ultimately need to go I use a Hängeregistrat... |
How does investing in commodities/futures vary from stocks? | As Dilip has pointed out in the comment, investing in commodities is to either delivery or Buy. Lets say you entered into buying "X" quantities of Soybeans in November, contract is entered into May. In November, if the price is higher than what you purchased for, you can easily sell this, and make money. If in November... |
Are tax deductions voluntary? | There are many people who have deductions far above the standard deduction, but still don't itemize. That's their option even though it comes at a cost. It may be foolish, but it's not illegal. If @littleadv citation is correct, the 'under penalty of perjury' type issue, what of those filers who file a Schedule A but ... |
Transfering money from NRE to saving account is taxable or not | There are quite a few things here; Edit: If you are away for 2.5 Years, you are NRE. Your situation is slightly tricky in the sense that you are getting a salary in India for doing work outside. Please consult a professional CA who can advise you better. If you were not getting an Indian salary, then whatever you earn ... |
Are cashiers required to check a credit card for a signature in the U.S.? | Working retail myself, I do not accept an unsigned card without verification. If I received one I would ask for ID and verify the photo with the Name. I would also let the buyer know it was unsigned and remind them that anyone finding it can sign it and use the card without issue. Putting on the back of the card "SEE ... |
Taxes, Puts and the Wash Rule | There are different schools of thought. You can ask the IRS - and it would not surprise me if you got different answers on different phone calls. One interpretation is that a put is not "substantially identical" to the disposed stock, therefore no wash is triggered by that sale. However if that put is exercised, then y... |
Why buying an inverse ETF does not give same results as shorting the ETF | Suppose that the ETF is currently at a price of $100. Suppose that the next day it moves up 10% (to a price of $110) and the following day it moves down 5% (to a price of $104.5). Over these two days the ETF has had a net gain of 4.5% from its original price. The inverse ETF reverses the daily gains/losses of the bas... |
Converting bank statements to another currency? | If the account is not dollar-denominated, I would say it does not make sense at all to have dollar-denominated statements. Such a statement would not even be accurate for any reasonable amount of time (since FX rates constantly fluctuate). This would be a nightmare for accounting purposes. If you really need to know th... |
Using a Roth IRA instead of a college savings account | The problem with this plan is that in order for your children to put money in their own IRA, they need earned income of their own. If your child doesn't have $3000 in earned income for the year, you won't be able to put the $3000 into their Roth IRA. |
How to improve credit score and borrow money | No you should not borrow money at 44.9%. I would recommend not borrowing money except for a home with a healthy deposit (called down payment outside UK). in December 2016, i had financial crisis So that was like 12 days ago. You make it sound like the crisis was a total random event, that you did nothing to cause it.... |
Why do investors buy stock that had appreciated? | From an amateur: Prices aren't entirely rational - they float, and the day to day prices of stock are an excellent example of this. So how would you assign an appropriate value to it? There is a logical minimum, the scrap value of the assets and the cash on hand. However, that doesn't take into account the expectati... |
Is there any benefit to investing in an index fund? | Index funds are good for diversifying risk. For people who don't have a large sum of money to invest, holding all the different types of stocks in the index is both very expensive and not practical because you incur too many transaction costs. For an index funds, the main advantages are that costs are pooled, and inves... |
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... |
Which types of insurances do I need to buy? | Can you afford to replace your home if it suffers major damage in a fire or earthquake? Is your home at risk of flooding? In the United States, one can purchase insurance for each of these risks, but the customer has to ask about each of them. (Most default American homeowners policies cover fire and wind damage, bu... |
Calculating savings from mortgage interest deduction vs. standard deduction? | Those choices aren't mutually exclusive. Yes, most discussion of the mortgage interest deduction ignores the fact that for a standard itemizer, much, if not all of this deduction can be lost. For 2011, the std deduction for a single is $5,800. It's not just mortgage interest that's deductible, state income tax, reale... |
Pay off credit card debt or earn employer 401(k) match? | A matching pension scheme is like free money. No wait, it actually IS free money. You are literally earning 100% interest rate on that money the instant you pay it in to the account. That money would have to sit in your credit card account for at least five years to earn that kind of return; five years in which the pen... |
Should I get cash from credit card at 0% for 8 months and put it on loans? | There are two issues here: arithmetic and psychology. Scenario 1: You are presently paying an extra $500 per month on your student loan, above the minimum payments. Your credit card company offers a $4000 cash advance at 0% for 8 months. So you take the cash advance, pay it toward the student loan, and then instead of ... |
Why don't banks print their own paper money / bank notes? | In the US, this was the case during the 19th century. There was a system of "subscriptions" between banks, where larger banks backed the smaller banks to some extent. In trade, notes from distant banks were not accepted or discounted relative to known local banks, or silver/gold coinage. There were a number of problems... |
In a competitive market, why is movie theater popcorn expensive? | Movie theater popcorn concessions are not really a competitive market. |
Setting up auto-pay. Should I use my bank that holds mortage or my personal bank? | One factor to consider is timing. If you set up the automatic payments through the bank that holds the mortgage (I'll call them the "receiving" bank), they will typically record the transactions as occurring on the actual dates you've set up the automatic payments to occur on, which generally eliminates e.g. the risk o... |
At what point does it become worth it to file an insurance claim? | At what point can you not afford the repair, and how will that repair affect your home? In your scenario, you would be claiming $1, which I could agree is universally bad. A good tip is to raise the deductible to the point you feel you can cover on your own so you aren't tempted. (It would lower your premium too) This... |
After Market Price change, how can I get it at that price? | You can make a purchase at the after market price by sending an order that gets executed in after market. Often times these are called Extended orders, or EXT. With an EXT limit order it will place the bid on the after market hours order book. If you get filled, then you have the shares. This is the answer. |
Is there a candlestick pattern that guarantees any kind of future profit? | I did a historical analysis a few years back of all well-known candlestick patterns against my database of 5 years worth of 1-minute resolution data of all FTSE100 shares. There wasn't a single pattern that showed even a 1% gain with 60% reliability. Unfortunately I don't have spread data other than for a handful of ... |
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