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What is the difference between equity and assets? | Equity does not represent production divisions in a company (i.e. chocolate, strawberry, and vanilla does not make sense). In Sole proprietorship, equity represents 1 owner. In Partnership, equity has at least two sub-accounts, namely Partner 1 and Partner 2. In Corporations, equity may have Common Stockholders and ... |
Do corporate stock splits negate share repurchase programs? | No, I think you are misunderstanding the Math. Stock splits are a way to control relatively where the price per share can be for a company as companies can split or reverse split shares which would be similar to taking dimes and giving 2 nickels for each dime, each is 10 cents but the number of coins has varied. This d... |
Should the price of fuel in Australia at this point be so high? | First price isn't artificially maintained at a level. When a refining company signs a contract to buy crude from a supplier, it promises to buy at a certain price with options for increase and decrease due to the fluctuating prices in the market. And it buys crude to build up a certain buffer to supply itself for a cer... |
Accidentally opened a year term CD account, then realized I need the money sooner. What to do? | In my experience, the only penalty to breaking a CD is to lose a certain amount of accumulated interest. Your principal investment will be fine. Close the CD. A few days of interest is nothing. |
Can I trust the Motley Fool? | Upselling you is how they make money. That's the price of the free content. Test their recommendations. Pretend to buy the stocks they say. How do they do? Do they ever say to sell the stocks after their buy recommendations? There are lots and lots of opinions out there. I doubt people really hear about the good o... |
Is it unreasonable to double your investment year over year? | Yes. The definition of unreasonable shows as "not guided by or based on good sense." 100% years require a high risk. Can your one stock double, or even go up three fold? Sure, but that would likely be a small part of your portfolio. Overall, long term, you are not likely to beat the market by such high numbers. That s... |
How to decide on limits when purchasing/selling stocks? | You said your strategy was to put it into a index fund. But then you asked about setting stock limits. I'm confused. Funds usually trade at their price at the end of the day, so you shouldn't try to time this at all. Just place your order. If you are buying ETFs, there is going to be so much volume on the market th... |
What is an “Options Account”? | Options are a derivative product, and in this case, derive their value from an underlying security, a traded stock. An option gives you the right, but not the obligation, to buy a stock at a given price (the strike price) by a given time (the expiration date.) What I just described is a call option. The opposite instru... |
How can the Samsung Upgrade Programme offer 0% APR? | The financing is built into the price. I do not have hard facts, but I strongly suspect that very few people buy brand-new smartphones at full price upfront. Most pay a monthly installment to the carrier or retailer equal to 1/24 of the full price, which in effect is "0% financing for 2 years". Samsung might be able... |
Indian citizen working from India as freelancer for U.S.-based company. How to report the income & pay tax in India? | There is no reason for you to open a firm. However, it will help you, if you operate separate bank account for business and personal purposes. You can run your business as proprietorship business. Your inward remittance is your income. You can deduct payment made to your colleagues as salary. You should pay them by way... |
Why do some people say a house “not an investment”? | With an investment, you tend to buy it for a very specific purpose, namely to make you some money. Either via appreciation (ie, it hopefully increases value after you take all the fees and associated costs into account, you sell the investment, realise the gains) or via a steady cashflow that, after you subtracted your... |
How accurate is Implied Volatility in predicting future moves? | How accurate is Implied Volatility in predicting future moves? How would you measure this? If the implied volatility says that there's a 1% chance that a stock will double, and it doubles, was it "right"? You could also say that it says there's a 99% change that it doesn't double, so was it "wrong"? What you could ... |
Why does ExxonMobil's balance sheet show more liabilities than assets? | Even assuming you were reading the balance sheet correctly it means nothing. What banks mostly care about is cash flow. Do they have enough extra money to make the payments on whatever they borrow? I have never had a credit card company ask me about assets--they don't care. They care about income with which to pay th... |
Asset allocation when retirement is already secure | You will hear a lot about diversifying your portfolio, which typically means having a good mix of investment types, areas of investments, etc. I'd like to suggest that you should also diversify your sources. Sad to say but the defined benefit pension is not a rock solid, sure fire source of security in your retirement... |
What is the effect of a cancelled stock order on a stock and the market? | That article, like almost any article written by a non-expert and quoting only "research" from lobbying groups, hugely misses the point. The vast majority of orders that end up being cancelled are cancelled as a standard part of exchanges' official market-maker programs. Each exchange wants you and me to know that it h... |
Individual Investor Safe Reinvest Gains Strategy? | Your idea is a good one, but, as usual, the devil is in the details, and implementation might not be as easy as you think. The comments on the question have pointed out your Steps 2 and 4 are not necessarily the best way of doing things, and that perhaps keeping the principal amount invested in the same fund instea... |
Is person-person lending/borrowing protected by law? | By protected you mean what exactly? In the US, generally you'd get a promissory note signed by B saying "B promises to repay A such and such amount on such and such terms". In case of default you can sue in a court of law, and the promissory note will be the evidence for your case. In case of B declaring bankruptcy, yo... |
Buying a house. I have the cash for the whole thing. Should I still get a mortgage to get the homeowner tax break? | Not for the tax break, no; as others have said that still costs you money. However, with rates being low right now and brought a bit lower by the tax break, this is an opportunity for the safest form of leveraged investing you will ever find. If you invest that money, the returns on investment will probably be better t... |
Cash flow implications of converting primary mortgaged residence to rental | The rental income is indeed taxable income, but you reduce the taxable portion of it by deducting expenses (including mortgage interest, maintenance, insurance, HOA, real estate tax, and of course depreciation). Due to the depreciation, you may end up breaking even, or having very little taxable income. Note that when ... |
If the U.S. defaults on its debt, what will happen to my bank money? | You must mean the current debt ceiling debacle. The meaning of it is: US government is constantly borrowing money (by issuing treasury bonds) and constantly repaying some of the bonds that come to maturity, and also has other obligations it has to meet by law all the time - such as Social Security checks, bonds interes... |
Where can I find announcements of official GDP figures for the US and other countries? | For press releases about economic data, the Bureau of Economic Analysis press release page is helpful. Depending on the series, you could also look at the Bureau of Labor Statistics press release page. For time series of both historical and present data, the St. Louis Federal Reserve maintains a database such data, in... |
Are 'no interest if paid in in x months' credit cards worth it? | It has been reported in consumer media (for example Clark Howard's radio program) that the "no interest for 12 months" contracts could trick you with the terms and the dates on the contract. Just as an example: You borrow $1000 on 12/1/2013, same as cash for 12 months. The contract will state the due date very clearly... |
What is the difference between speculating and investing? | Speculation means putting your money on a hunch that some event may occur, depending on current circumstances and some future circumstances. So either you win huge or lose a lot. Investment is a conscious decision made on well defined research and grounded on good reasons i.e. economy, industry, company reports etc. H... |
What's the point of a benchmark? | One reason it matters whether or not you're beating the S&P 500 (or the Wilshire 5000, or whatever benchmark you choose to use) is to determine whether or not you'd be better off investing in an index fund (or some other investment vehicle) instead of pursuing whatever your current investment strategy happens to be. E... |
Want to buy expensive product online. Credit line on credit cards not big enough. How do “Preferred Account” programs work? | First and foremost - make sure where you are purchasing the product is a reputable organization. Secondly (coming from a biased computer geek) - be aware that Apple is a content trap. Now on to my answer to your question... How do "Preferred Account" programs work? They're "Preferred" because they tend to bring in mo... |
Are there capital gains taxes or dividend taxes if I invest in the U.S. stock market from outside of the country? | The country from which you purchase stock cannot charge you tax on either income or capital gains. Taxation is based on residency, so even when you purchase foreign stock its the tax laws of Malaysia (as your country of residence) that matter. At the time of writing, Malaysia does not levy any capital gains tax and the... |
Why do employer contributions count against HSA limits? | am I comparing apples and oranges? Yes - different purposes, different laws, different regulations. One rationale could be that HSA benefits are immediate while retirement benefits are deferred, so the benefit of employer contributions are not felt until retirement and thus do not need as stringent a limit, but that's... |
What are 'business fundamentals'? | From http://financial-dictionary.thefreedictionary.com/Business+Fundamentals The facts that affect a company's underlying value. Examples of business fundamentals include debt, cash flow, supply of and demand for the company's products, and so forth. For instance, if a company does not have a sufficient sup... |
Boyfriend is coowner of a house with his sister, he wants to sell but she doesn't | That ain't nothing. It's really easy to get "whipped up" into a sense of entitlement, and forget to be grateful for what you do have. If this house doesn't exist, what would his costs of housing be elsewhere? Realistically. Would landlords rent to him? Would other bankers lend him money to buy a house? Would those ... |
Why don't banks allow more control over credit/debit card charges? | The other answers touch on why having two-factor auth or some other additional system is not worth it compared to simple reactive systems (cancelling lost cards, reversing fraudulent charges etc), but it should also be noted that this goal can be achieved with a method similar to what you describe. My bank (TD Canada ... |
Will a credit card issuer cancel an account if it never incurs interest? | No, they won't cancel it because you pay your card on time. When a company offers a promotion like that they are banking on making money on average, not in every case. On average including all the benefits including transaction fees, deals for partnering with best buy, etc. Of course some people pay their credit car... |
How does the Dow Jones Industrial Average (DJIA) divisor change to account for dividends? | Scrip dividends are similar to stock splits. With a stock split, 100 shares can turn into 200 shares; with scrip dividends they might turn into 105 shares. |
Am I doing the math for this covered call/long put strategy correctly? What risks do I run with this strategy? | FYI: GM has an earnings announcement on April 24th. I think you were trying to create a safe trade by profiting if GM's price fell within a probable range. The chart of the Iron Condor captures just about a standard deviation of movement. So as long as GM is between 31.28 - 37.22 in 34 days you keep the max profit o... |
What are the options for a 19-year-old college student who only has about $1000? | The "$1000 is no money at all" people are amusing me. Way back in the mists of time, a very young me invested on the order of ~$500 in a struggling electronics manufacturer I had a fondness for. An emotional investment, not much money, but enough that I could get a feel for what it was like owning stock in something. T... |
How to avoid tax when taking a windfall in small chunks? | How can I avoid this, so we are taxed as if we are making the $60k/yr that we want to receive? You can't. In the US the income is taxed when received, not when used. If you receive 1M this year, taking out 60K doesn't mean the other 940K "weren't received". They were, and are taxable. Create a pension fund in the corp... |
Bed and Breakfast, Same Day Capital Gains UK | The 'same day rule' in the UK is a rule for matching purposes only. It says that sales on any day are matched firstly with purchases made on the same day for the purposes of ascertaining any gain/loss. Hence the phrase 'bed-and-breakfast' ('b&b') when you wish to crystalise a gain (that is within the exempt amount) an... |
What mix of credit lines and loans is optimal for my credit score? | I think you are interpreting their recommended numbers incorrectly. They are not suggesting that you get 13-21 credit cards, they are saying that your score could get 13-21 points higher based on having a large number of credit cards and loans. Unfortunately, the exact formula for calculating your credit score is not ... |
Why does short selling require borrowing? | It's actually quite simple. You're actually confusing two concept. Which are taking a short position and short selling itself. Basically when taking a short position is by believing that the stock is going to drop and you sell it. You can or not buy it back later depending on the believe it grows again or not. So basic... |
What do these options trading terms mean? | With stocks, you can buy or sell. If you sell first, that's called 'shorting.' As in "I think linkedin is too high, I'm going to short it." With options, the terminology is different, the normal process is to buy to open/sell to close, but if you were shorting the option itself, you would first sell to open, i.e you ar... |
Buying insurance (extended warranty or guarantee) on everyday goods / appliances? | I usually say "no thank you", but if the salesperson gets pushy I say "if I need insurance, I guess I won't buy the product because I only want to buy quality that will last a good long while" I have never actually walked away from a purchase because I generally research these things ahead of time, but I think I mean i... |
Do I need to prove 'Garage Sale' items incurred a loss | -Alain Wertheimer I'm a hobbyist... Most (probably all) of those older items were sold both prior to my establishing the LLC This is a hobby of yours, this is not your business. You purchased all of these goods for your pleasure, not for their future profit. The later items that you bought after your LLC was establish ... |
Will a credit card issuer cancel an account if it never incurs interest? | While technically true, a card issuer can cancel your card for almost any reason they want, it's highly unlikely they'll cancel it because you pay your bills! There are many, many people out there that pay their bills in full every month without ever paying a cent in credit card interest. I wouldn't ever purposefully i... |
Can a Roth IRA be used as a savings account? | Sounds like a bad idea. The IRA is built on the power of compounding. Removing contributions will hurt your retirement savings, and you will never be able to make that up. Instead, consider tax-free investments. State bonds, Federal bonds, municipal bonds, etc. For example, I invest in California muni bonds fund which ... |
Getting (historical) Standard & Poor Stock Guides | Log in to your Scottrade account, and goto Markets --> Analyst Views --> Click the PDF link for the company. Also, there is also the 'Views and News' part of the web page which has additional information beyond what exist in the reports. |
What are the reasons to get more than one credit card? | 3 reasons I can think of: I once worked for a bank and when credit scoring for loans, if you had been approved by different institutions, you were given a better score. So if you held a Visa and Mastercard (as opposed to two Visa cards) your credit score would go higher. More than 6 cards though looked suspicious and y... |
Why is the stock market price for a share always higher than the earnings per share? | What you have to remember is you are buying a piece of the company. Think of it in terms of buying a business. Just like a business, you need to decide how long you are willing to wait to get paid back for your investment. Imagine you were trying to sell your lemonade stand. This year your earnings will be $100, next ... |
What actions can I take against a bank for lack of customer service? | Figure out who regulates the bank. Complain to your state banking/consumer affairs department. Complain to your state Attorney General. The Feds regulate most banks too, there are several different agencies, and I believe the way they regulate banks has changed recently. Try contacting the US Comptroller of the Currenc... |
What does “profits to the shareholders jumped to 15 cents a share” mean? | It's a way to help normalize the meaning of the earnings report. Some companies like Google have a small number of publicly traded shares (322 Million). Others like Microsoft have much larger numbers of shares (8.3 Billion). The meaning depends on the stock. If it's a utility company that doesn't really grow, you don't... |
How do I find a good mutual fund to invest 5K in with a moderately high amount of risk? | Vanguard has a lot of mutual fund offerings. (I have an account there.) Within the members' section they give indications of the level of risk/reward for each fund. |
How does a public company turn shares into cash? | how do they turn shares into cash that they can then use to grow their business? Once a Company issues an IPO or Follow-On Public Offer, the company gets the Money. Going over the list of question tagged IPO would help you with basics. Specifically the below questions; How does a company get money by going public in an... |
Why invest in IRA while a low-cost index fund is much simpler? | Lots of good answers. I'll try and improve by being more brief. For each option you will pay different taxes: Index Fund: Traditional IRA Roth IRA You can see that the Roth IRA is obviously better than investing in a taxable account. It may not be as obvious that the traditional IRA is better as well. The reason ... |
Is dividend included in EPS | EPS is often earnings/diluted shares. That is counting shares as if all convertible securities (employee stock options for example) were converted. Looking at page 3 of Q4 2015 Reissued Earnings Press Release we find both basic ($1.13) and diluted EPS ($1.11). Dividends are not paid on diluted shares, but only actual s... |
For very high-net worth individuals, does it make sense to not have insurance? | The general answer to this is "yes". When you're dealing with single-digit millionaires, the answer is that their insurance habits and needs are basically the same as everyone else. When you get into the double digit and triple digit millionaires, or people worth billions, they have additional options, but those basi... |
What are my best options if I don't have a lot of credit lines for housing loans? | The short answer is, with limited credit, your best bet might be an FHA loan for first time buyers. They only require 3.5% down (if I recall the number right), and you can qualify for their loan programs with a credit score as low as 580. The problem is that even if you were to add new credit lines (such as signing up... |
How to pay with cash when car shopping? | I usually get a cashiers check to cover about 90% - 95% of the expected amount (whatever I think is just below my wet-dream-price), and bring the rest in cash. That doesn't require so much cash to be carried. Alternatively you can write a personal check for the exact reminder, or go to the bank for the reminder after t... |
In a competitive market, why is movie theater popcorn expensive? | I think this question has more to do with the business model of cinema. If I remember correctly. Most of the money from ticket sales goes back to the studios. Something like the newer a movie is the greater percentage goes back to the movie studios and the older a movie is the greater percentage of ticket price goes to... |
Can I open a Solo 401(k) if I am an independent contractor but also work part-time as an employee? | I'm in a similar situation as I have a consulting business in addition to my regular IT job. I called the company who has my IRA to ask about setting up the Individual 401k and also mentioned that I contribute to my employer's 401k plan. The rep was glad I brought this up because he said the IRS has a limit on how muc... |
What is the median retirement savings in the United States today? | If you dig deeper and look at the original study, what's being measured is "retirement-plan participation": specifically, money in 401(k) plans and IRAs. This omits every other possible source of retirement money: things such as general savings, non-retirement investments, property ownership, pensions, etc. As an extr... |
Is it possible to influence a company's actions by buying stock? | Energy Transfer Partners, LP (stock symbol ETP) is the parent company of Dakota Access LLC, the developer of the Dakota Access Pipeline. Since ETP is a publicly traded company, it is certainly possible to purchase the stock. To answer your questions: Would it not be possible to buy their stocks, bring down the price o... |
A check I received was lost. My options? | Lost checks happen occasionally, and there are procedures in place (banking & business) to handle the situation. First and foremost you need to: Note: The money is legally yours, so the company is obligated to work with you here. If they refuse to cancel or reissue the check, at a minimum you'll want to contact the s... |
Why would a company care about the price of its own shares in the stock market? | Investors are typically a part of the board of directors of the company. Because of their ownership in the company, they have a vested interest in its stock price. The same is true for management also in cases where they hold a certain percentage of equity in the company. Their incentives also get aligned to the stock ... |
find stock composition of a publicly traded fund | The big websites, Yahoo and the like, only give the 10 biggest positions of any fund. Download the annual report of the fund, go to page 18, you will find the positions on the 31st of December. However the actual positions could be different. The same applies to all funds. You need the annual report. |
Understanding the Nasdaq insider trading information | Their argument is mostly nonsense. Take someone like Tim Cook, CEO of Apple. He has a not very large salary, and makes a lot more money through stock bonuses. You would never, ever expect him to buy Apple shares. And assuming that he doesn't want to end up one day as the richest man in the cemetery, you would expect hi... |
Can somebody give a brief comparison of TSP and IRAs? | Ideally, one would contribute the maximum amount you're allowed to both the TSP and an IRA. For the 2015 tax year, that would be $18,000 for the TSP and $5,500 for the IRA (if you're 50 or older, then you can add an additional catch up amount of $6,000 to the TSP and $1,000 to the IRA). If, like most people, you cannot... |
Zero volatility stocks in intraday trading in India | Find a stock screener that has data for the BSE and NSE. You may be able to look directly at volatility but a good stock screener will have the technical analysis indicator called "average true range", ATR for short. This will let you see the average range of price moves over several days. |
Did my salesman damage my credit? What can I do? | This shows the impact of the inquiries. It's from Credit Karma, and reflects my inquiries over the past two years. In my case, I refinanced 2 properties and the hit is after this fact, so my score at 766 is lower than when approved. You can go to Credit Karma and see how your score was impacted. If in fact the first in... |
How can I live outside of the rat race of American life with 300k? | Consider buying a legal "mother daughter" property, rent out the top part, and live in the "mother" component. |
What's a reliable way for a non-permanent resident alien in the USA to get an auto loan? | I took @littleadv 's recommendation that online apps only ask for citizenship due to post-9/11 legislation. I applied to 2 banks in person (one big, one small), and at the dealership. None of my in-person applications ever touched on the issue of citizenship. I even applied in person at the same bank that insta-rejec... |
Is it better to pay an insurance deductible, or get an upgrade? | If you repair your phone, when your current balance is paid off, could you get the same coverage for less money? Or would your monthly payment remain the same regardless? That would be the easiest comparison to make. ie: Pay an extra $49 to have the phone replaced [ie: the cost of using the insurance program for $149,... |
Calculating Future Value: Initial deposit and recurring deposits of a fixed but different Value | Illustrating with a shorter example: Suppose I deposit 1,000 USD. Every year I deposit another 100 USD. I want to know how much money will be on that savings account in 4 years. The long-hand calculation is Expressed with a summation And using the formula derived from the summation (as shown by DJohnM) So for 20 yea... |
I am looking for software to scan and read receipts | Scanning receipts is easy and any decent scanner will do a good job for you. The difficult part is the software that 'extracts' the data. Today there is no software that can do this really well because there is just too great a range of receipts (e.g. handwritten receipts, receipts in foreign languages, etc.). For this... |
Apartment Security Deposit refunds in Maryland | In Maryland, a landlord must hold your security deposit in an escrow account and pay you interest when returning the deposit. The interest is simple interest; it does not compound. The interest rate that they must pay has changed over the last 43 years. Before October 1, 2004, the rate was 4%. Until January 1, 2015,... |
Should withheld income tax be included as income? | Does it make sense to report withheld tax income as an additional income? Is it required by the IRS? Is $T deductible? This is what is called imputed income. The ticket is an income for you, but the company doesn't want you to pay tax on it. But you have to. But they want to be nice to you and give you the ticket on ... |
What options do I have at 26 years old, with 1.2 million USD? | Buy a land and build a house. Then plant wine trees. Hire people after like 5 years and start to do and sell wine. A beautiful business :-) A second opation is to buy a houses in a city and rent rooms. |
What is the tax treatment of scrip dividends in the UK? | The HMRC website would explain it better to you. There is a lot of factors and conditions involved, so refer to the HMRC website for clarification. If your question had more details, it could have been easy to pinpoint the exact answer. Do I declare the value of shares as income Why would you do that ? You haven't gene... |
PayPal wants me to “add a bank account”, another funding source. Credit card isn't working. Why? | It's possible the recipient of the payment is not setup to receive funds form PayPal from a credit card, too. |
meaning of qualifying/disqualifying distribution as separate from capital gains implications | A qualifying distribution seems guaranteed to fall under long term capital gains. But a disqualifying distribution could also fall under long term capital gains depending on when it is sold. So what's the actual change that occurs once something becomes a qualifying as opposed to a disqualifying distribution? Yes a qua... |
Could someone place an independent film on the stock market? | Stock is a part ownership of a business. First there has to be a business that people want to own part of because they expect to make a profit from that ownership. Nobody is going to be interested if the business isn't worth anything. In other words: sure, you could try to start a movie production house to make this ... |
Free, web-based finance tracking with tag/label support? | hledger fits your criteria, have you tried it ? Here's the web interface. |
What is the opposite of a hedge? | I guess the opposite of being hedged is being unhedged. Typically, a hedge is an additional position that you would take on in order to mitigate the potential for losses on another position. I'll give an example: Say that I purchase 100 shares of stock XYZ at $10 per share because I believe its price will increase in t... |
Clarification on 529 fund | You are faced with a dilemma. If you use a 529 plan to fund your education, the short timeline of a few years will limit your returns that are tax free. Most people who use a 529 plan either purchase years of tuition via lump sum, when the child is young; or they put aside money on a regular basis that will grow tax d... |
How to chose index funds, mutual funds from a plethora of options (TD Ameritrade) | One thing to be aware of when choosing mutual funds and index ETFs is the total fees and costs. The TD Ameritrade site almost certainly had links that would let you see the total fees (as an annual percentage) for each of the funds. Within a category, the lowest fees percentage is best, since that is directly subtracte... |
Should I charge my children interest when they borrow money? | This is largely a cultural issue. I would be appalled at the very idea that my parents would charge me interest for lending me money. Just as they would be appalled if I were to do so if lending them money. I find the idea of attempting to make money off of your children fundamentally wrong. I realize that you only wa... |
Relation between inflation rates and interest rates | Is it true that due the to the increase in interest rates that inflation is likely to increase as well? It is typically the reverse where inflation causes interest rates to rise. Interest rates fundamentally reflect the desire for people to purchase future goods over present day goods. If I loan money to someone for 5... |
I cosigned for a friend who is not paying the payment | If the bank is calling your employer, the federal Fair Debt Collection Practices Act (FDCPA) limits where and when debt collectors can contact consumer debtors. In many cases, debt collectors that contact debtors at work are violating the FDCPA. http://www.nolo.com/legal-encyclopedia/a-debt-collector-calling-me-work-is... |
Does a growing economy mean the economy is becoming less efficient? | A growing economy should become more efficient because of increased opportunity for division of labor: specialization. External regulation or monetary policy external to the free market can cause parts of the economy to grow in response to said regulations. This creates inefficiencies that are wrung out of the economy... |
What are the benefits of opening an IRA in an unstable/uncertain economy? | As I stated in my comment on @JCotton's answer, the only way you benefit by putting your money in an IRA or other tax-deferred vehicle is if you expect to have a lower tax rate when you withdraw than when you put the money in. If you look at @JCotton's numbers and remember to pay taxes when you withdraw the money in 3... |
Why diversify stocks/investments? | Basically, diversifying narrows the spread of possible results, raising the center of the returns bell-curve by reducing the likelihood of extreme results at either the high or low end. It's largely a matter of basic statistics. Bet double-or-nothing on a single coin flip, and those are the only possible results, and... |
What does this diagram from Robert Kiyosaki about corporations mean? | These types of diagrams appear all throughout Kiyosaki's Rich Dad, Poor Dad book. The arrows in the diagrams represent cash flow. For example, the first two diagrams of this type in the book are: The idea being presented here is that an asset generates income, and a liability generates expenses. According to the boo... |
Value of a call option spread | On expiry, with the underlying share price at $46, we have : You ask : How come they substract 600-100. Why ? Because you have sold the $45 call to open you position, you must now buy it back to close your position. This will cost you $100, so you are debited for $100 and this debit is being represented as a negative... |
Can dividends be exploited? | In addition to the other answers it's also noteworthy that the stock exchanges themselves adjust the price quotes via their ex-div mechanism. All limit orders present in the book when the stock goes ex-div will be adjusted by the dividend. Which means you can't even get "accidentally" filled in the very unlikely case ... |
Are 'per trade' fees charged on every order or just once per stock? | The answer, like many answers, is "it depends". Specifically, it depends on the broker, and the type of account you have with the broker. Most brokers will charge you once per transaction, so a commission on the buy, and a commission (and SEC fee in the US) on the sale. However, if you place a Good-til-Canceled (GTC) o... |
Can an immigrant get a mortgage in the us? | There are two Questions: Financial institutions do not care about your nationality, only your ability to pay over time. For long term debt the lender will want assurances that the borrower has the ability and means to pay the debt over time. A legal resident in the US should have no more difficulty obtaining financing ... |
Is Cost of Living overstated? | You mention: High rent places are usually also high property value places. Given the tax incentives, it seems like a good long term idea to grab a house, so if we assume you have the option of working and buying a house in a high CoL or a low CoL city, I think you'd prefer the high cost. Because essential... |
What variety of hedges are there against index funds of U.S. based stocks? | Even though "when the U.S. sneezes Canada catches a cold", I would suggest considering a look at Canadian government bonds as both a currency hedge, and for the safety of principal — of course, in terms of CAD, not USD. We like to boast that Canada fared relatively better (PDF) during the economic crisis than many othe... |
Can a company stop paying dividends? | Yes. Companies increase, decrease, start paying and stop paying dividends when they think it appropriate. If a company has been going through some problems and makes a loss, or even a large decrease in profits, they can choose to stop paying dividends until things improve. Many companies did this during the Global Fin... |
How to invest in gold at market value, i.e. without paying a markup? | And you have hit the nail on the head of holding gold as an alternative to liquid currency. There is simply no way to reliably buy and sell physical gold at the spot price unless you have millions of dollars. Exhibit A) The stock symbol GLD is an ETF backed by gold. Its shares are redeemable for gold if you have more t... |
What exactly can a financial advisor do for me, and is it worth the money? | If you don't have the time or interest to manage investments, you need a financial advisor. Generally speaking, you're better served by an advisor who collects an annual fee based on a percentage of your account value. Advisors who are compensated based on transactions have a vested interest to churn your account, whi... |
Put-Call parity - what is the difference between the two representations? | Well, the first one is based on the "Pert" formula for continuously-compounded present value, while the second one is the periodically-compounded variant. Typically, the continuously-compounded models represent the ideal; as the compounding period of time-valued money shrinks towards zero, and the discount rate (or in... |
Definition of “secular” in the context of markets? | According to Wikipedia: In the finance industry, something done on a secular basis is done on a long-term basis, not a temporary or cyclical one, with a time frame of "10–50 years or more" Source |
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