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Did my salesman damage my credit? What can I do? | Hindsight is 20/20, but I offer some suggestions for how this might have gone down. If you had told the bank what was going on they might have extended the terms of your loan until the truck was ready. Alternatively you might have taken the loan (was it secured on the truck?) and put the money in a savings account until the truck showed up, while asking the dealer to pay the interest on it until the truck showed up. Or you might asked the dealer to supply you with a rental truck until yours showed up. I'm not saying I would have thought of these under the circumstances, but worth trying. |
Which field should I use for getting the income yield of this bond ETF? | What you want is the distribution yield, which is 2.65. You can see the yield on FT as well, which is listed as 2.64. The difference between the 2 values is likely to be due to different dates of updates. http://funds.ft.com/uk/Tearsheet/Summary?s=CORP:LSE:USD |
Does this sound like a great idea regarding being a landlord and starting a real estate empire? | This is a common and good game-plan to learn valuable life skills and build a supplemental income. Eventually, it could become a primary income, and your strategic risk is overall relatively low. If you are diligent and patient, you are likely to succeed, but at a rate that is so slow that the primary beneficiaries of your efforts may be your children and their children. Which is good! It is a bad gameplan for building an "empire." Why? Because you are not the first person in your town with this idea. Probably not even the first person on the block. And among those people, some will be willing to take far more extravagant risks. Some will be better capitalized to begin with. Some will have institutional history with the market along with all the access and insider information that comes with it. As far as we know, you have none of that. Any market condition that yields a profit for you in this space, will yield a larger one for them. In a downturn, they will be able to absorb larger losses than you. So, if your approach is to build an empire, you need to take on a considerably riskier approach, engage with the market in a more direct and time-consuming way, and be prepared to deal with the consequences if those risks play out the wrong way. |
How does the currency between countries relate | Firstly currency prices, like any asset, depend on supply and demand. Meaning how many people want to exchange a currency to another one vs. wanting to buy that currency using another currency. Secondly, it really depends on which country and economy you are talking about. In emerging economies, currencies are very often influenced by the politics of that country. In cases like the US, there are a myriad reasons. The USD is mostly governed by psychology (flight to safety) and asset purchases/sales. In theory, currencies balance, given the inflation of a country and its trade with other countries. e.g. Germany, which was always exporting more than it was importing, had the problem of a rising currency. (Which would make its exports more expensive on foreign markets. This is the balancing act.) |
How to invest 100k | How to spend the money is up to you. That includes spending money on your house. (This is a safer way to look at it than an "investment". Not that it can't ever be treated as such, but that doing so often makes it easy to justify bad decisions and overspending on the house.) So with regards to the mortgage: So if it's not a monstrously huge deal, you might prefer to avoid default. Now, how to invest the rest while waiting to spend it, now... |
Can PayPal transfer money automatically from my bank account if I link it in PayPal? | As the other answers stated: Yes PayPal will transfer money from your bankaccount automatically if your PayPal balance isn't sufficient. Let's add some proof to the story: (Note, I am in the EU, specifically the Netherlands, situation might be different in other parts of the world) If I login to PayPal and go to my wallet, I have a section that looks like this: If I click on it, I am presented with a screen with details about the connection. Note the "Direct debit instruction". If I click on the "view" link I am presented with the following text (emphasis mine): [snip some arbitrary personal details] This authorisation allows (A) PayPal to send instructions to your bank account and (B) your bank to debit your account in accordance with the instructions from PayPal. As part of your rights, you are entitled to a refund from your bank under the Terms and Conditions of your agreement with your bank. A refund must be claimed within 8 weeks starting from the date on which your account was debited. Your rights are explained in a statement that you can obtain from your bank. Below this text is a button to delete the authorization. |
In what state should I register my web-based LLC? | Register in Nevada. It's a no brainer. I understand that it's not a great deal of money, but if you can save several hundred dollars per year, why not? It's the same amount (actually probably less) of paperwork to register in Nevada. |
How to avoid getting back into debt? | Depending on how marketable your degree is, in the long run you may be better aquiring some student debt rather than slowing down your studies. For example finishing finance, medicine, or engineering a year later would mean one less year of your life that you are earning substantial income. The only situation where slowing down your studies is of benefit is if your savings plus interest would be greater than the income you are giving up by taking longer. Live frugally, take whatever work you can without hurting your studies, don't stress if you can't get this to balance perfectly. I speak from experience on this. Screwing around with working through school cost me 2.5 years of earning potential ($120,000+). |
When a stock price goes down, does the money just disappears into thin air? | You buy a $100k sport car, but don't buy any insurance. You take a curve too fast and jump out just in time to see your car go off a cliff, like a chase movie. The value went from $100k to zero in seconds. Where did the $100k go? |
How to pay bills for one month while waiting for new job? | This is just a partial answer, but I believe the following observations are relevant: |
Is there any public data available to determine an ETF's holdings? | You can check the website for the company that manages the fund. For example, take the iShares Nasdaq Biotechnology ETF (IBB). iShares publishes the complete list of the fund's holdings on their website. This information isn't always easy to find or available, but it's a place to start. For some index funds, you should just be able to look up the index the fund is trying to match. This won't be perfect (take Vanguard's S&P 500 ETF (VOO); the fund holds 503 stocks, while the S&P 500 index is comprised of exactly 500), but once again, it's a place to start. A few more points to keep in mind. Remember that many ETF's, including equity ETF's, will hold a small portion of their assets in cash or cash-equivalent instruments to assist with rebalancing. For index funds, this may not be reflected in the index itself, and it may not show up in the list of holdings. VOO is an example of this. However, that information is usually available in the fund's prospectus or the fund's site. Also, I doubt that many stock ETF's, at least index funds, change their asset allocations all that frequently. The amounts may change slightly, but depending on the size of their holdings in a given stock, it's unlikely that the fund's manager would drop it entirely. |
Who owns historical valuations about equity such as stocks and index funds? | I expect that data may be copyright. Data that's published (e.g. on a newsfeed or web site) is subject to terms of use. Standard & Poor's web site says, about the Shiller indexes, Who do I contact at S&P to license my use of these indices? Questions regarding licensing the S&P/Case-Shiller Home Price Indices can be addressed to: Bo Chung Managing Director bo_chung@standardandpoors.com, +1.212.438.3519 As for 'recording' the information yourself, that may depend on how and where (e.g. from what source) you're recording it. If for example you tried to record prices from the Canadian MLS (Realtor's) network, they too have their own terms of use on the data they publish. Copyright laws vary from country to country (and terms of use certainly vary): for example see http://en.wikipedia.org/wiki/Feist_v._Rural which is case law about copyrighting a phone directory in the USA, and contrast that with http://en.wikipedia.org/wiki/Database_right which is European legislation. So who owns data if it is determined by free market? I guess that "determined by free market" means that buyers and sellers are publishing their offers-to-buy and their offers-to-sell, and I guess that the publisher (e.g. the stock exchange) has 'terms of use' about the data (the offers) that they're publishing. |
Online Foreign Exchange Brokerages: Which ones are good & reputable for smaller trades? | I used Oanda.com for Forex trading a couple years ago. I am in the US but I think it's available in the UK as well. At the time, they had no commissions and their spreads were comparable or better than other brokers. The spreads would just quite considerably when a big event like a Fed meeting or the unemployment figures come out, but I suspect that that is the same everywhere (or they have constant spreads and reject trades). They did not push the high leverages like other brokers were at the time. I considered this to be very reputable, because though the profits to be gotten through 100:1 leverage are great advertising, the reality is that one unexpected spike and a newbie would lose a bunch of money in a margin call. |
What does the average log-return value of a stock mean? | Log-returns are very commonly used in financial maths, especially quantitative finance. The important property is that they're symmetrical around 0 with respect to addition. This property makes it possible to talk about an average return. For instance, if a stock goes down 20% over a period of time, it has to gain 25% to be back where you started. For the log-return on the other hand the numbers are 0.223 down over a period of time, and 0.223 up to get you back to square 1. In this sense, you can simply take an arithmetic average and it makes sense. You can freely add up or subtract values on the log-return scale, like log-interest rates or log-inflation rates. Whereas the arithmetic mean of (non-log) returns is simply meaningless: A stock with returns -3% and +3% would have 0% on average, when in fact the stock has declined in price? The correct approach on direct price-returns would be to take a different mean (e.g. geometric) to get a decent average. And yet it will be hard to incorporate other information, like subtracting the risk-free rate or the inflation rate to get rate-adjusted average returns. In short: Log-returns are easier to handle computationally, esp. in bulk, but non-log-returns are easier to comprehend/imagine as a number of their own. |
Why would you elect to apply a refund to next year's tax bill? | There actually are legitimate reasons, but they don't apply to most people. Here are a few that I know of: You're self-employed and have to pay quarterly estimated taxes. Rather than wait for the refund when you already have to pay 1/4 of next year's taxes at the same time, you just have the IRS apply to refund forward. (so you're not out the money you owe while waiting for your refund). You're filing an amended or late return, and so you're already into the next year, and have a similar situation as #1, where your next year's taxes have already come due. You're planning on declaring bankruptcy, and you're under the Tenth Circuit, those credits might be safe from creditors For almost any other situation, you're better off taking the money, and using it to pay down debt, or put it somewhere to make interest (although, at the current rates, that might not be very much). |
Are bond ETF capital gains taxed similar to stock or stock funds if held for more than 1 year? | Yes, that's correct. |
Where can publicly traded profits go but to shareholders via dividends? | Where can publicly traded profits go but to shareholders via dividends? They can be retained by the company. |
Pay Yourself With Credit Card Make Money With Cash Back [duplicate] | This is basically a form of credit card kiting, it's not necessarily illegal but it can be. It is, however, against the TOS in pretty much every merchant agreement (including Paypal and Square), so you'd most likely have your account suspended, and the merchant could pursue legal action if they felt they could prove intent to deceive. It's not practical given actual fee structures, but even if it were, most merchants are quite good at detecting this sort of thing and quick to shut down accounts. |
Does the P/E ratio not apply to bond ETFs? | How would you compute the earnings for governments that are some of the main issuers of bonds and debt? When governments run deficits they would have a negative earnings ratio that makes the calculation quite hard to evaluate. |
Is there an advantage to a traditional but non-deductable IRA over a taxable account? [duplicate] | The most common use of non-deductible Traditional IRA contributions these days, as JoeTaxpayer mentioned, is as an intermediate step in a "backdoor Roth IRA contribution" -- contribute to a Traditional IRA and then immediately convert it to a Roth IRA, which, if you had no previous pre-tax money in Traditional or other IRAs, is a tax-free process that achieves the same result as a regular Roth IRA contribution except that there are no income limits. (This is something you should consider since you are unable to directly contribute to a Roth IRA due to income limits.) Also, I want to note that your comparison is only true assuming you are holding tax-efficient assets, ones where you get taxed once at the end when you take it out. If you are holding tax-inefficient assets, like an interest-bearing CD or bond or a stock that regularly produces dividends, in a taxable account you would be taxed many times on that earnings, and that would be much worse than with the non-deductible Traditional IRA, where you would only be taxed once at the end when you take it out. |
At what percentage drop should you buy to average down | TL;DR; There is no silver bullet. You have to decide how much to invest and when on your own. Averaging down definition: DEFINITION of 'Average Down' The process of buying additional shares in a company at lower prices than you originally purchased. This brings the average price you've paid for all your shares down. BREAKING DOWN 'Average Down' Sometimes this is a good strategy, other times it's better to sell off a beaten down stock rather than buying more shares. So let us tackle your questions: At what percentage drop of the stock price should I buy more shares. (Ex: should I wait for the price to fall by 5% or 10% to buy more.) It depends on the behaviour of the security and the issuer. Is it near its historical minimum? How healthy is the issuer? There is no set percentage. You can maximize your gains or your losses if the security does not rebound. Investopedia: The strategy is often favored by investors who have a long-term investment horizon and a contrarian approach to investing. A contrarian approach refers to a style of investing that is against, or contrary, to the prevailing investment trend. (...) On the other side of the coin are the investors and traders who generally have shorter-term investment horizons and view a stock decline as a portent of things to come. These investors are also likely to espouse trading in the direction of the prevailing trend, rather than against it. They may view buying into a stock decline as akin to trying to "catch a falling knife." Your second question: How many additional shares should I buy. (Ex: Initially I bought 10 shares, should I buy 5,10 or 20.) That depends on your portfolio allocation before and after averaging down and your investor profile (risk apettite). Take care when putting more money on a falling security, if your portfolio allocation shifts too much. That may expose you to risks you shouldn't be taking. You are assuming a risk for example, if the market bears down like 2008: Averaging down or doubling up works well when the stock eventually rebounds because it has the effect of magnifying gains, but if the stock continues to decline, losses are also magnified. In such cases, the investor may rue the decision to average down rather than either exiting the position or failing to add to the initial holding. One of the pitfalls of averaging down is when the security does not rebound, and you become too attached to be able to cut your losses and move on. Also if you are bullish on a position, be careful not to slip the I down and add a T on said position. Invest with your head, not your heart. |
Do market shares exhaust? | Let's clarify some things. Companies allow for the public to purchase their shares through Initial Public Offering (IPO) (first-time) and Seasoned Public Offering (SPO) (all other times). They choose however many shares they want to issue depending on the amount of capital they want to raise. What this means is that the current owners give up some ownership % in exchange for cash (usually). In the course of IPOs and SPOs, it can happen that the public will not buy all shares if there is very little interest, but I would assume that the more probable scenario if very little interest is present is that the shares' value would take a big drop on their issuance date from the proposed IPO/SPO price. After those shares are bought by the public, they are traded on Exchanges which are a secondary and (mostly) do not affect the underlying company. The shares are exchanged from John Doe to Jane Doe as John Doe believes the market value for those shares will take a direction that Jane Doe believes in the opposite. Generally speaking, markets will find an equilibrium price where you can reasonably easily buy-sell securities as the price is not too far from what most participants in the market believe it should be. In cases where all participants agree on the direction (most often in case of a crash) it can be hard to find a party to make a trade with. Say a company just announced negative news with long-lasting effects on the business there will be a surge in sell orders with very few buyers. If you are willing to buy, you will likely very easily find a trading partner but if you are trying to sell instead then you will have to compete for the lowest price against all other sellers. All that to say that in such cases, while shares are technically sellable / purchasable, the end result can be that no shares are purchasable. |
How to value employee benefits? | It would depend on the health insurance that was being offered, and if it covers your family or just you. We pay around $500-600 for individual health insurance for our employees (families cost north of 1500 a month). It's extremely expensive. Provide more details on the stock purchase plan as well (it sounds to me like in that case you'd only be getting for free what it would cost to purchase the stock... but that's only $10-15, so negligible in this case.) |
Who can truly afford luxury cars? | Most of the people I know that own them are slightly older, and thus in their prime earning years, and many have paid off their homes. That can free up $1000 a month or more in monthly expenses, which would easily cover a nice luxury car payment. If you've got it, and are into cars, why not? What's the point in having the biggest tombstone in the graveyard? |
When filing taxes in Canada, in what cases does box 39 on the T4 get reported as half of box 38? | Apparently box 39 does not receive half of box 38 if "The price of the share or unit is less than its fair market value when the agreement was made." - the last point in paragraph 110(1)(d): *http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/fnncl/scrty/stckpt03-eng.html#dspst The employee can claim a deduction under paragraph 110(1)(d) of the Income Tax Act if all of the following conditions are met: |
I'm self-employed with my own LLC. How should I pay myself, given my situation? | You're conflating LLC with Corporation. They're different animals. LLC does not have "S" or "C" designations, those are just for corporations. I think what you're thinking about is electing pass through status with the IRS. This is the easiest way to go. The company can pay you at irregular intervals in irregular amounts. The IRS doesn't care about these payments. The company will show profit or loss at the end of the year (those payments to you aren't expenses and don't reduce your profit). You report this on your schedule C and pay tax on that amount. (Your state tax authority will have its own rules about how this works.) Alternatively you can elect to have the LLC taxed as a corporation. I don't know of a good reason why someone in your situation would do this, but I'm not an accountant so there may be reasons out there. My recommendation is to get an accountant to prepare your taxes. At least once -- if your situation is the same next year you can use the previous year's forms to figure out what you need to fill in. The investment of a couple hundred dollars is worthwhile. On the question of buying a home in the next couple of years... yes, it does affect things. (Pass through status? Probably doesn't affect much.) If all of your income is coming from self-employment, be prepared for hassles when you are shopping for a mortgage. You can ask around, maybe you have a friendly loan officer at your credit union who knows your history. But in general they will want to see at least two years of self-employment tax returns. You can plan for this in advance: talk to a couple of loan officers now to see what the requirements will be. That way you can plan to be ready when the time comes. |
Is it worth it to reconcile my checking/savings accounts every month? | I quit diligently reconciling monthly statements some years before everything was online, when I realized that for years before that, every time I thought I found a mistake, it was always my own error. I was spending a fair amount of time (over the years) doing something that wasn't helping me. So I quit. That said, I do look at the statements and/or check the transactions on a regular basis (I now use email notifications of automatic deposits as the trigger, and then look over withdrawals, too) to make sure everything looks appropriate. I'm less concerned about a bank error than I am about identity or account theft. |
Is there any reason not to put a 35% down payment on a car? | It sounds like you're basing your understanding of your options regarding financing (and even if you need a car) on what the car salesman told you. It's important to remember that a car salesman will do anything and say anything to get you to buy a car. Saying something as simple as, "You have a low credit score, but we can still help you." can encourage someone who does not realize that the car salesman is not a financial advisor to make the purchase. In conclusion, |
Is there a good rule of thumb for how much I should have set aside as emergency cash? | I think that Dave Ramsey has a good approach to emergency funds. Save $1,000 that is immediately accessible in an emergency, pay off your debts, then build a 3-6 month fund. Two years is great, but takes a really long time to build up. |
Is it possible to make quarterly returns in hedge funds? | Your edit indicates that you may not yet be ready to get heavily involved in investing. I say this because it seems you are not very familiar with foundational finance/investing concepts. The returns that you are seeing as 'yearly' are just the reported earnings every 12 months, which all public companies must publish. Those 'returns' are not the same as the earnings of individual investors (which will be on the basis of dividends paid by the company [which are often annual, sometimes semi-annual, and sometimes quarterly], and by selling shares purchased previously. Note that over 3 months time, investing in interest-earning investments [like bank deposits] will earn you something like 0.5%. Investing in the stock market will earn you something like 2% (but with generally higher risk than investing in something earning interest). If you expect to earn significant amounts of money in only 3 months, you will not be able to without taking on extreme levels of risk [risk as high as going to a casino]. Safe investing takes time - years. In the short term, the best thing you can do to earn money is by earning more [through a better job, or a second part-time job], or spending less [budget, pay down high interest debt, and spend less than you earn]. I highly recommend you look through this site for more budgeting questions on how to get control of your finances. If you feel that doesn't apply to you, I encourage you to do a lot more research on investing before you send your money somewhere - you could be taking on more risk than you realize, if you are not properly informed. |
What funds were closed during or after the recent recessions? | Yes, many hedge funds (for example) did not survive 2008-2009. But hedge funds were failing both before and after that period, and other hedge funds thrived. Those types of funds are particularly risky because they depend so much on leverage (i.e. on money that isn't actually theirs). More publically-visible funds (like those of the big-name index fund companies) tended not to close because they are not leveraged. You say that "a great many companies" failed during the recession, but that's not actually true. I can't think of more than a handful of publically-traded companies that went bankrupt. So, since the vast majority of publically-traded companies stayed in business, their stocks kept some/most of their value, and the funds that owned those stocks stayed afloat. I personally did not see a single index fund that went out of business due to the recession. |
Website for managing personal cash inflow and outflow, applicable to India? | You might like https://planwise.com/index.htm |
Understanding the Nasdaq insider trading information | Usually insiders are in a better position than you to understand their business, but that doesn't mean they will know the future with perfect accuracy. Sometimes they are wrong, sometimes life events force them to liquidate an otherwise promising investment, sometimes their minds change. So while it is indeed valuable information, as everything in fundamental analysis it must be taken with a grain of salt. Automatic Sell I think these refer to how the sell occurred. Often the employees don't get actual shares but options or warrants that can be converted to shares. Or there may be special predetermined arrangements regarding when and how the shares may be traded. Since the decision to sell here has nothing to do with the prospects of the business, but has to do with the personal situation of the employee, it's not quite the same as outright selling due to market concerns. Some people, for instance, are not interested in holding stock. Part of their compensation is given in stock, so they immediately sell the stock to avoid the headache of watching an investment. This obviously doesn't indicate that they expect the company will go south. I think automatic sell refers to these sorts of situations, but your broker should provide a more detailed definition. Disposition (Non Open Market) These days people trade through a broker, but there's nothing stopping you from taking the physical shares and giving them to someone in exchange for say a stack of cash. With a broker, you only "sell" without considering who is buying. The broker then finds buyers for you according to their own system. If selling without a broker you can also be choosy with who is buying, and it's not like anybody can just call up the CEO and ask to buy some stock, so it's a non-open market. Ultimately though it's still the insider selling. Just on a different exchange. So I would treat this as any insider sell - if they are selling, they may be expecting the stock to become less valuable. indirect ownership I think this refers to owning an entity that in turn owns the asset. For instance CEO of XYZ owns stock in ACME, but ACME holds shares of XYZ. This is a somewhat complicated situation, it comes down to whether you think they sold ACME because of the exposure to XYZ or because of some other risk that applies only to ACME and not XYZ. Generally speaking, I don't think you would find a rule like "if insider transactions of so and so kinds > X then buy" that provides guaranteed success. If such a rule was possible it would have been exploited already by the professionals. The more sensible option is to consider all data available to you and try to make a holistic evaluation. All of these insider activities can be bullish or bearish depending on many other factors. |
How do share buybacks work? | Something to note is that when a company announces a share buyback program there is usually a time frame and amount of shares that are important details as it isn't like the company will make one big buy back of stock generally. Rather it may take months or even years as noted in the Wikipedia article about share repurchases. Wikipedia covers some of the technical details here but to give a specific set of answers: When a company announces a share buyback program, who do they actually buy back the shares from? From the Wikipedia link: "Under US corporate law there are five primary methods of stock repurchase: open market, private negotiations, repurchase 'put' rights, and two variants of self-tender repurchase: a fixed price tender offer and a Dutch auction." Thus, there are open market and a couple of other possibilities. Openly traded shares on a stock exchange? Possibly, though there are other options. Is there a fixed price that they buy back at? Sometimes. I'd think a "fixed price tender offer" would imply a fixed price though the open market way may take various prices. If I own shares in that company, can I get them to buy back my shares? Selective Buy-Backs is noted in Wikipedia as: "In broad terms, a selective buy-back is one in which identical offers are not made to every shareholder, for example, if offers are made to only some of the shareholders in the company. In the US, no special shareholder approval of a selective buy-back is required. In the UK, the scheme must first be approved by all shareholders, or by a special resolution (requiring a 75% majority) of the members in which no vote is cast by selling shareholders or their associates. Selling shareholders may not vote in favor of a special resolution to approve a selective buy-back. The notice to shareholders convening the meeting to vote on a selective buy-back must include a statement setting out all material information that is relevant to the proposal, although it is not necessary for the company to provide information already disclosed to the shareholders, if that would be unreasonable." Thus it is possible, though how probable is another question. While not in the question, something to consider is how the buybacks can be done as a result of offsetting the dilution of employees who have stock options that may exercise them and spread the earnings over more shares, but this is more on understanding the employee stock option scenario that various big companies use when it comes to giving employees an incentive to help the stock price. |
Homeowners: How can you protect yourself from a financial worst-case scenario? | Think about your priorities in life. Everybody is a little different. In my case I have a wife and child, so these are priorities for me, and you might have your own depending on your story. So if I lost my job, and I have no more money coming in (unemployment insurance runs out, savings depleted) then the bank can have the house. I personally would probably drop the house long before it came to that point. The first thing you do is talk to your creditors and work out a deal. At the same time I would stop paying for ALL unnecessary things (cable TV, extra cell phones, automobiles, leaving light bulbs on and turning the heat up over putting on a sweater). If I can't get a good deal from the creditors, I would stop paying the mortgage, find a place to live (family, friends, cheap apartment) while the credit is still good. My advice is to get yourself setup while your credit is good and you have SOME money in the bank. Waiting until the bank decides to foreclose is probably going to make your harder. |
What can my relatives do to minimize their out of pocket expenses on their fathers estate | Consider contracting with a property management company to lease and maintain the house until it can be sold. Rent on the property should cover the mortgage, property taxes, etc. The property management company can handle maintenance and the tenant would be responsible for utilities. |
What factors make someone buy or sell a stock? | First, note that a share represents a % of ownership of a company. In addition to the right to vote in the management of the company [by voting on the board of directors, who hires the CEO, who hires the VPs, etc...], this gives you the right to all future value of the company after paying off expenses and debts. You will receive this money in two forms: dividends approved by the board of directors, and the final liquidation value if the company closes shop. There are many ways to attempt to determine the value of a company, but the basic theory is that the company is worth a cashflow stream equal to all future dividends + the liquidation value. So, the market's "goal" is to attempt to determine what that future cash flow stream is, and what the risk related to it is. Depending on who you talk to, a typical stock market has some degree of 'market efficiency'. Market efficiency is basically a comment about how quickly the market reacts to news. In a regulated marketplace with a high degree of information available, market efficiency should be quite high. This basically means that stock markets in developed countries have enough traders and enough news reporting that as soon as something public is known about a company, there are many, many people who take that information and attempt to predict the impact on future earnings of the company. For example, if Starbucks announces earnings that were 10% less than estimated previously, the market will quickly respond with people buying Starbucks shares lowering their price on the assumption that the total value of the Starbucks company has decreased. Most of this trading analysis is done by institutional investors. It isn't simply office workers selling shares on their break in the coffee room, it's mostly people in the finance industry who specialize in various areas for their firms, and work to quickly react to news like this. Is the market perfectly efficient? No. The psychology of trading [ie: people panicking, or reacting based on emotion instead of logic], as well as any inadequacy of information, means that not all news is perfectly acted upon immediately. However, my personal opinion is that for large markets, the market is roughly efficient enough that you can assume that you won't be able to read the newspaper and analyze stock news in a way better than the institutional investors. If a market is generally efficient, then it would be very difficult for a group of people to manipulate it, because someone else would quickly take advantage of that. For example, you suggest that some people might collectively 'short AMZN' [a company worth half a trillion dollars, so your nefarious group would need to have $5 Billion of capital just to trade 1% of the company]. If someone did that, the rest of the market would happily buy up AMZN at reduced prices, and the people who shorted it would be left holding the bag. However, when you deal with smaller items, some more likely market manipulation can occur. For example, when trading penny stocks, there are people who attempt to manipulate the stock price and then make a profitable trade afterwards. This takes advantage of the low amount of information available for tiny companies, as well as the limited number of institutional investors who pay attention to them. Effectively it attempts to manipulate people who are not very sophisticated. So, some manipulation can occur in markets with limited information, but for the most part prices are determined by the 'market consensus' on what the future profits of a company will be. Additional example of what a share really is: Imagine your neighbor has a treasure chest on his driveway: He gathers the neighborhood together, and asks if anyone wants to buy a % of the value he will get from opening the treasure chest. Perhaps it's a glass treasure chest, and you can mostly see inside it. You see that it is mostly gold and silver, and you weigh the chest and can see that it's about 100 lbs all together. So in your head, you take the price of gold and silver, and estimate how much gold is in the chest, and how much silver is there. You estimate that the chest has roughly $1,000,000 of value inside. So, you offer to buy 10% of the chest, for $90k [you don't want to pay exactly 10% of the value of the company, because you aren't completely sure of the value; you are taking on some risk, so you want to be compensated for that risk]. Now assume all your neighbors value the chest themselves, and they come up with the same approximate value as you. So your neighbor hands out little certificates to 10 of you, and they each say "this person has a right to 10% of the value of the treasure chest". He then calls for a vote from all the new 'shareholders', and asks if you want to get the money back as soon as he sells the chest, or if you want him to buy a ship and try and find more chests. It seems you're all impatient, because you all vote to fully pay out the money as soon as he has it. So your neighbor collects his $900k [$90k for each 10% share, * 10], and heads to the goldsmith to sell the chest. But before he gets there, a news report comes out that the price of gold has gone up. Because you own a share of something based on the price of gold, you know that your 10% treasure chest investment has increased in value. You now believe that your 10% is worth $105k. You put a flyer up around the neighborhood, saying you will sell your share for $105k. Because other flyers are going up to sell for about $103-$106k, it seems your valuation was mostly consistent with the market. Eventually someone driving by sees your flyer, and offers you $104k for your shares. You agree, because you want the cash now and don't want to wait for the treasure chest to be sold. Now, when the treasure chest gets sold to the goldsmith, assume it sells for $1,060,000 [turns out you underestimated the value of the company]. The person who bought your 10% share will get $106k [he gained $2k]. Your neighbor who found the chest got $900k [because he sold the shares earlier, when the value of the chest was less clear], and you got $104k, which for you was a gain of $14k above what you paid for it. This is basically what happens with shares. Buy owning a portion of the company, you have a right to get a dividend of future earnings. But, it could take a long time for you to get those earnings, and they might not be exactly what you expect. So some people do buy and sell shares to try and earn money, but the reason they are able to do that is because the shares are inherently worth something - they are worth a small % of the company and its earnings. |
Does dividend on 401K have any effect on gains | Adjusting for a market change from day to day, the dividend should have no impact on you. Your X shares time $Y should be nearly identical right after that dividend hits the account. And within the 401(k) or IRA for that matter, the accounting doesn't matter most of the time. Outside a retirement account, you need to pay tax on the dividend, and add the newly purchased shares' cost to your cost basis. |
Investing in low cost index fund — does the timing matter? | A much less verbose answer is. Don't worry about buying low. You have a whole lifetime to dollar cost average your retirement dollars. |
How should I prepare for the next financial crisis? | How would gold have protected you during the 2007/8 crisis? In no way, shape or form. The ways to protect yourself at any time are: Boring, huh? |
How to calculate how much a large stock position is really worth? | Something like cost = a × avg_spreadb + c × volatilityd × (order_size/avg_volume)e. Different brokers have different formulas, and different trading patterns will have different coefficients. |
Are credit cards not viewed as credit until you miss one payment? | This does not directly address the question, but how the Bank views your behaviour is not the same as a credit reporting bureau. If you do not "go deep" on your card at all, you may be deemed not to be exercising the facility, indeed they may ask you to reduce your credit limit. This is not the same as "missing a payment". At the same time, do not just make the minimum payment. Ideally you should clear it within 3 months. Think of it as a very short term line of credit. Not clearing the balance within three months (or turning it over) demonstrates a cash flow problem, as does clearing it from another card. Some banks call this "kite flying" after similar behaviour in older days with cheque accounts. If you use the credit and show you can pay it off, you should never need to ask for a credit increase, it will be offered. The Bureau will be informed of these offers. Also, depending upon how much the bank trusts you, the Bureau may see a "monthly" periodic credit review, which is good if you have no delinquencies. Amex does this as a rule. |
Mortgage refinancing | If you selected a mortgage that allows additional payments to be credited against the principal rather than as early payment of normal installments, them yes, doing so will reduce the actual cost of the loan. You may have to explicitly instruct the bank to use the money this way each time, if prepay is their default assumption. Check with your lender, and/or read the terms of your mortgage, to find out if this is allowed and how to do it. If your mortgage doesn't allow additional payments against the principal, you may want to consider refinancing into a mortgage which does, or into a mortgage with shorter term and higher monthly payments, to obtain the same lower cost (modulo closing costs on the new mortgage; run the numbers.) |
Where should I invest to hedge against the stock market going down? | If you were certain you would probably do best by short selling an ETF that tracked the index for the market you think was about to tank. You'd certainly make a lot more money on that strategy than precious metals. If you were feeling super confident and want to make your money earn even more, you could also buy a bunch of put options on those same ETF funds. Obligatory Warning: Short selling and options can be extremely risky. While most investments cap your potential losses to your total investment, a short sale has no theoretical limit to the amount of money you can lose. |
Should I get a personal loan to pay on my mortgage to go “above water” to qualify for a refinance? | Does it cost money to refi? I know there are quite a few deals out there, I refi'd in June for $500, not bad. But sometimes can cost couple grand. If so, you have up front costs, plus the cost of the personal loan, that probably would break even at some point after your refi, but at what point? Will you sell before then, or even think about it? Or would you break even next year, then its a no brainer. As mentioned by others, do the numbers. |
Resources to begin trading from home? | Since then I had gotten a job at a supermarket stocking shelves, but recently got fired because I kept zoning out at work This is not a good sign for day trading, where you spend all day monitoring investments. If you start focusing on the interesting math problem and ignoring your portfolio, you can easily lose money. Not so big a problem for missed buy opportunities, but this could be fatal for missed sale opportunities. Realize that in day trading, if you miss the uptick, you can get caught in a stock that is now going down. And I agree with those who say that you aren't capitalized well enough to get started. You need significantly more capital so that you can buy a diversified portfolio (diversification is your limitation, not hedging). Let's say that you make money on two out of three stocks on average. What are the chances that you will lose money on three stocks in a row? One in twenty-seven. What if that happens on your first three stocks? What if your odds at starting are really one in three to make money? Then you'll lose money more than half the time on each of your first three stocks. The odds don't favor you. If you really think that finance would interest you, consider signing up for an internship at an investment management firm or hedge fund. Rather than being the person who monitors stocks for changes, you would be the person doing mathematical analysis on stock information. Focusing on the math problem over other things is then what you are supposed to be doing. If you are good at that, you should be able to turn that into a permanent job. If not, then go back to school somewhere. You may not like your schooling options, but they may be better than your work options at this time. Note that most internships will be easier to get if you imply that you are only taking a break from schooling. Avoid outright lying, but saying things like needing to find the right fit should work. You may even want to start applying to schools now. Then you can truthfully say that you are involved in the application process. Be open about your interest in the mathematics of finance. Serious math minds can be difficult to find at those firms. Given your finances, it is not practical to become a day trader. If you want proof, pick a stock that is less than $100. Found it? Write down its current price and the date and time. You just bought that stock. Now sell it for a profit. Ignore historical data. Just monitor the current price. Missed the uptick? Too bad. That's reality. Once you've sold it, pick another stock that you can afford. Don't forget to mark your price down for the trading commission. A quick search suggests that $7 a trade is a cheap price. Realize that you make two trades on each stock (buy and sell), so that's $14 that you need to make on every stock. Keep doing that until you've run out of money. Realize that that is what you are proposing to do. If you can make enough money doing that to replace a minimum wage job, then we're all wrong. Borrow a $100 from your mom and go to town. But as others have said, it is far more realistic to do this with a starting stake of $100,000 where you can invest in multiple stocks at once and spread your $7 trading fee over a hundred shares. Starting with $100, you are more likely to run out of money within ten stocks. |
What is a good 5-year plan for a college student with $15k in the bank? | I disagree with the IRA suggestion. Why IRA? You're a student, so probably won't get much tax benefits, so why locking the money for 40 years? You can do the same investments through any broker account as in IRA, but be able to cash out in need. 5 years is long enough term to put in a mutual fund or ETF and expect reasonable (>1.25%) gains. You can use the online "analyst" tools that brokers like ETrade or Sharebuilder provide to decide on how to spread your portfolio, 15K is enough for diversifying over several areas. If you want to keep it as cash - check the on-line savings accounts (like Capitol One, for example, or Ally, ING Direct that will merge with Capitol One and others) for better rates, brick and mortar banks can not possible compete with what you can get online. |
What one bit of financial advice do you wish you could've given yourself five years ago? | Advice to myself: the benefits of being self-employed totally outweigh the risks! |
GnuCash: expense tracking/amounts left under limits | Yes. The simplest option to track your spending over time is to familiarize yourself with the "Reports" menu on the toolbar. Take a look specifically at the "Reports > Income/Expense > Income Statement" report, which will sum up your income and spending over a time frame (defaults to the current year). In each report that you run, there is an "Options" button at the top of the screen. Open that and look on the "General" tab, you'll be able to set the time frame that the report displays (if you wanted to set it for the 2 week block since your last paycheck, for example). Other features you're going to want to familiarize yourself with are the Expense charts & statements, the "Cash Flow" report, and the "Budgeting" interface (which is relatively new), although there is a bit of a learning curve to using this last feature. Most of the good ideas when it comes to tracking your spending are independent of the software you're using, but can be augmented with a good financial tracking program. For example, in our household we have multiple credit cards which we pay in full every month. We selected our cards on specific benefits that they provide, such as one card which has a rotating category for cash back at certain business types. We keep that card set on restaurants and put all of our "eating out" expenses on that card. We have other cards for groceries, gas, etc. This makes it easy to see how much we've spent in a given category, and correlates well with the account structure in gnucash. |
What would happen if I were to lose all equity in my condo when it's time to renew the mortgage? | It doesn't matter. You will just renew your mortgage at the prevailing rates. That's part of the mortgage contract. The problem that happens is if you want to move your mortgage to another bank for a better rate, they may not accept you. Your re-negotiating position is limited. Most mortgages have a portability option where you can even transfer the mortgage to another property, but you'd have to buy a cheaper house. |
How can I estimate business taxes / filing fees for a business that has $0 income? | Is the business an S-Corp, LLC or Sole Prop? I am going to guess based on the question that it is an LLC that you never closed with the state and you live in a state (NY) that charges a fee for having an LLC in the state in which case you owe those fees to the state. I am not aware of any taxes on the mere existence of a business by the IRS. I think you are going to find out that the are no taxes owed to the IRS for this nonexistent activity. |
Friend was brainwashed by MLM-/ponzi investment scam. What can I do? | So here's the sad truth. He might actually be making a return on his investment. Not because it's right or because the system works, but in all these schemes there are a range of people that actually do make money. In addition to that, there is that fact that he "believes" that he is doing a good thing, and is unwilling to discuss it. So, if he is making, even a tiny return, and really believes that he is making a large return, or that that large return is just around the bend, your never going to convince him otherwise. You have two real options; If he will listen, go though and look at money in v.s. money out. If money out is larger then money in, your screwed. Make sure to point out that he should look at real money in (left a bank account) and real money out (deposited to a bank account). Again be prepared for the fact that he is actually making money. Some people in the pyramid will make money, it's just never as much, or as many people as they make it out to be. Don't attack the system, attack other aspects. Try and argue liquidity, or FDIC insurance. Again not trying to show why the system is bad, but why a investment in foo instead may be better. If nothing else, go with diversify. Never put all your money in one spot, even if it's a really good spot. At least in that case he will have some money left over in the end. That said, your friend may not go for it. May just put on blinders, and may just stick finger in ears. Move to option two. Respect his wishes, and set boundaries. "Ok, I hear you, you like system X, I won't bring it up again. Do me a favor, don't you bring it up again either. Let's just leave this with religion and politics." If he continues to bring it up, then when he does, just point out you agreed not to discuss the issue, and if he continues to push it, rethink your friendship. If you both respect one another, you should be able to respect each others' decisions. If you can't then, sadly, you may need to stop spending time with one another. |
Can I get a dividend “free lunch” by buying a stock just before the ex-dividend date and selling it immediately after? [duplicate] | Not minutes, but hours. The "ex-dividend" date is the deadline for acquiring a stock to receive a dividend. If you hold a stock at the beginning of this day, you will receive the dividend. So you could buy a stock right at the end of the day on the day before the ex-dividend date, and sell it the next day (on the ex-dividend date), and you would get your dividend. See this page from the SEC for more information. The problem with this strategy, however, is that the value of the stock typically drops by the same amount as the dividend on that day. If you take a look at the historical price of the stock you are interested in, you'll see this. Of course, it makes sense why: a seller knows that selling before the date results in a loss of the dividend, so they want a higher price to compensate. Likewise, a buyer on or after the date knows that the dividend is already gone, so they want to pay a lower price. |
What's the difference between TaxAct and TurboTax? | I have used TurboTax for years with no problems. I clicked on the TaxAct link in an ad and decided to see if there was much different. Using the free version of Taxact, and inputting the exact same information, my federal taxes came out with a $1500 difference while my state taxes (NJ) came out almost identically. I rechecked my inputs twice and could find no typos in either program. While I would make out better with the TaxAct program in my wallet, I find the detailed questioning and directions in TurboTax to be superior. Somehow I am thinking that TaxAct has missed something but I can't figure out what. And the only way to actually print out your forms with TaxAct is to get the paid version, so comparing the final forms side bybside isn't a free option. |
Do gift cards expire? Does a gift certificate's value depreciate? How long can I keep them for? | It depends on: In Canada, Ontario, Manitoba, Alberta and Nova Scotia have each enacted legislation to stop gift cards/certificates from expiring. Cards issued before the effective date are still subject to the old rules. The legislation came into effect: There are several common themes: There are still some unusual exemptions such as mall gift cards in Ontario, Manitoba: Ontario is the first jurisdiction in Canada to regulate gift cards. [...] Mall cards (e.g. Eaton Centre gift card) will be covered by the expiry date ban and the new disclosure rules. However, these cards can temporarily maintain their current fee structure while the provincial government examines options on how to best regulate these types of cards. This will allow more time to develop an approach that strikes the right balance for consumers and businesses. For specific details see the appropriate link. |
What kind of technical analysis and indicators available for mutual fund navs | A general mutual fund's exact holdings are not known on a day-to-day basis, and so technical tools must work with inexact data. Furthermore, the mutual fund shares' NAV depends on lots of different shares that it holds, and the results of the kinds of analyses that one can do for a single stock must be commingled to produce something analogous for the fund's NAV. In other words, there is plenty of shooting in the dark going on. That being said, there are plenty of people who claim to do such analyses and will gladly sell you their results (actually, Buy, Hold, Sell recommendations) for whole fund families (e.g. Vanguard) in the form of a monthly or weekly Newsletter delivered by US Mail (in the old days) or electronically (nowadays). Some people who subscribe to such newsletters swear by them, while others swear at them and don't renew their subscriptions; YMMV. |
Is it necessary to pay tax if someone lends me money to put into my mortgage? | I can't vouch for Australian law, but in the US there is actually a recognized mechanism for "in-family loans" which ensures that it's all fully documented for tax purposes, including filing it as an official second mortgage. (Just did that recently in my own family, which is why I'm aware of it.) We're required to charge at least some interest (there's a minimum set, currently around 0.3%), and the interest is taxable income, and it is wise to get a lawyer to draw up the paperwork (there are a few services which specialize in this, charging a flat fee of about US$700 if the loan is standard enough that they can handle it as fill-in-the-blank), but outside of that it's pretty painless. This can also be used as a way of shifting gift limits from year to year -- if you issue a loan, and then gift the recipient with the payments each year (including the payments), you've effectively spread the immediate transfer of money over multiple years of taxes. Of course it does cost you the legal paperwork and the tax in the interest (which they're still "paying" out of your gift), but it can be a useful tool, and it's one that wasn't well known until recently. Again: This is all US codes, posted only for comparison (and for the benefit of US readers). It may be completely irrelevant. But it may be worth investigating whether Oz has something similar. |
Why have candlestick charts overlaps? | The market is simply gapping at these times, some news may have come out that makes the market gap on the open from its previous close. Being FX, the market in one country might be trading and then at the start of the hour trading in a different country may commence, causing a small gap in price. Generally many things could cause the price to gap up or down, and these gaps sometime can occur at the start of a new hour or other timeframe you are using. They do tend to happen more often at the start of a new day's trading on a daily chart, especially with stocks. |
How is Discover different from a Visa or a MasterCard? | Each of those is a network. Merchants displaying their logos - participate in their network and will accept cards that bear the same logo. Most merchants participate in more than one network. Discover is mostly used in the US, while Visa, Mastercard and American Express are more widely spread in the world (Amex less, Visa and MC are much more widely spread). In addition to being widely spread in the US, Discover is accepted everywhere where UnionPay is accepted (mostly in China) and Diners Club (mostly in EMEA). Advantages/disadvantages? You'll have to compare specific cards, but if you're a traveler in the world - then Discover will probably not be as appealing as Visa or Mastercard. |
Feasibility of using long term pattern on short term investments | There are Patterns inside of Patterns. You will see short term patterns (flags / pennants) inside of long term patterns (trend lines, channels) and typically you want to trade those short term patterns in line with the direction of the long term pattern. Take a look at the attached chart of GPN. I would like to recommend two excellent books on Chart Patterns. Richard W. Schabacker book he wrote in the 1930's. It is the basis for modern technical pattern analysis. Technical Analysis and Stock Market Profits Peter Brandt Diary of a Professional Commodity Trader. He takes you through analysis and trades. |
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 interest, federal employees' salaries and pensions, etc. By law, total amount of money that can be borrowed at the same time is capped. That means, there can be situation where the government needs to borrow money to pay, say, interest on existing bonds, but can not, since the limit is reached. Such situation is called a default, since the government promised to pay the interest, but is unable to do so. That does not mean the government has no money at all and will completely collapse or couldn't raise money on the market if it were permitted by law to do so (currently, the market is completely willing to buy the debt issued by US government, and with interest that is not very high, though of course that may change). It also does not mean the economy ceases to function, dollars cease to have value or banks instantly go bankrupt. But if the government breaks its promises to investors, it has various consequences such as raising the costs of borrowing in the future. Breaking promises to other people - like Social Security recipients - would also look bad and probably hurt many of them. Going back to your bank account, most probably nothing would happen to the money you store there. Even if the bank had invested 100% of the money in US treasury bonds (which doesn't really happen) they still can be sold on the open market, even if with some discount in the event of credit rating downgrade, so most probably your account would not be affected. As stated in another answer, even if the fallout of all these calamities causes a bank to fail, there's FDIC and if your money is under insured maximums you'll be getting your money back. But if your bank is one of the big ones, nothing of the sort would happen anyway - as we have seen in the past years, government would do practically anything to not allow any big bank failures. |
Clarify Microsoft's explanation of MIRR | The MIRR formula uses the finance rate to discount negative cash flows, but since the only negative cash flow in the example in in the current period, there's nothing to discount. It's meant to solve problems with IRR like when there are both positive and negative cash flows, which can result in multiple answers for IRR. The example they give isn't a good one for MIRR because it's a simple spend now, earn later scenario, which IRR is perfectly fine for. If you add a negative cashflow somewhere after the first one you'll see the answer change with difference financing rates. |
Alternative to Jumbo Mortgage | Yes, banks still offer combo loans, but it is going to depend on the appraised value of your home. Typically lenders will allow you to finance up to 80% loan to value on the first mortgage (conforming loan amount) and 95% combined loan to value on a HELOC. I would start by checking with your local credit union or bank branch. They have more competitive rates and can be more flexible with loan amount and appraised value guidelines. |
What is the purpose of endorsing a check? | So the bank can (theoretically) compare that signature to the ID you provide, showing that the names and signatures match and that you are the person to whom the check was written. |
W-4 was not updated when moving from part-time to full-time, still showed Tax-Exempt. What happens now? | The W4 specifies withholding for income taxes, FICA taxes are not impacted. The tax withholding is do that you do not need to make estimated tax payments. Failing to make sufficient quarterly estimated tax payments or withholding a sufficient amount could result in you being hit with under payment penalties but nothing more. The under payment penalties will be figured out as part of you income tax return. What you should have done when you discovered this was use the extra withholding line on the W4 to further increase your withholding. The nice thing about withholding is that you back load it and the IRS does not care. The company has no liability here. It is your responsibility to update them when your personal circumstances change. You will be fully responsible for the tax bill. There is no company paid portion of your income tax so they are not impacted. The company only pays an employer share of FICA and that is not impacted by how you fill out the W4. First thing to do is figure out how much you owe the IRS. Then determine if you can pay it or if you need to investigate an installment option. In any case make sure to file your return on time. |
Mortgage loan and move money to US | Let me restate question for clarity. Facts: Question: Are there any taxes for this transaction? Answer: (Added improvements provided by Eric) Generally No. Generally, it is not considered income until you sell and the sale price is greater than the purchase price. But with currency differences, there is an additional complication, section 988 rules apply. It could result in ordinary income or loss. |
Optimal down payment amount | The optimal down payment is 0% IF your interest rate is also 0%. As the interest rate increases, so does the likelihood of the better option being to pay for the car outright. Note that this is probably a binary choice. In other words, depending on the rate you will pay, you should either put 0% down, or 100% down. The interesting question is what formula should you use to determine which way to go? Obviously if you can invest at a higher return than the rate you pay on the car, you would still want to put 0% down. The same goes for inflation, and you can add these two numbers together. For example, if you estimate 2% inflation plus 1% guaranteed investment, then as long as the rate on your car is less than 3%, you would want to minimize the amount you put down. The key here is you must actually invest it. Other possible reasons to minimize the down payment would be if you have other loans with higher rates- then obviously use that money to pay down those loans before the car loan. All that being said, some dealers will give you cash back if you pay for the car outright. If you have this option, do the math and see where it lands. Most likely taking the cash back is going to be more attractive so you don't even have to hedge inflation at all. Tip: Make sure to negotiate the price of the car before you tell them how you are going to pay for it. (And during this process you can hint that you'll pay cash for it.) |
ESPP in the UK - worth it? Disqualifying / qualifying sales? | ESPP is common among US companies, often with a framework similar to your outline. In the US, some ESPPs allow sales of shares to be considered qualifying (subject to capital gains rather than ordinary income tax) if they are sold at least 2 years after the enrollment date and at least 1 year after the purchase date. These details can vary from one plan to another and will be stated in the company's ESPP enrollment documents. Do look at the high and low values of the stock over the last year. If it swings up and down more than 15% (or whatever the discount is), then that risk should be a factor in your decision. If the stock is trending upward over the long term and you are confident in the durability of the company, then you might favor holding. |
What risks are there acting as a broker between PayPal and electronic bank transfers? | Another reason to think it's a scam: fake paypal email notifications are a thing. I've seen one that was quite convincing (but it wasn't mine to properly analyse or report), so the intial payment may be a fake from another account belonging to the scammer, and you've just transferred money to the scammer. The fake email can include links to log in to a fake paypal website, which can be quite convincing as the mark will give the login details which can be used to scrape data. Links not going to where they say is the giveaway here. |
How can I buy shares of oil? I'm told it's done through ETFs. How's that related to oil prices per barrel? | While we're not supposed to make direct recommendations, and I am in no way advising anything, USO an ETF that buys light sweet crude oil futures with the intention of mirroring the price movements of oil. |
Was this bill forgotten by a medical provider, and do notices need to be sent before collections? | check the DATE OF SERVICE on all your invoices carefully. It's possible you actually DID pay already. Sometimes when a medical provider gets "mostly" paid by a third party insurer, they just drop the (small) remainder, as it's more cost than it's worth if it is a trivial amount. Alternatively, they wait until you show up for another office visit, and "ding" you then! |
Where can I find all public companies' information? | Moody's is now Mergent Online. It's no longer being printed, and must be accessed digitally. In order to browse the database, check with your local public library or university to see if you can get access. (A University will probably require you to visit for access). Another good tool is Value Line Reports. They are printed information sheets on public companies that are updated regularly, and are convenient for browsing and for comparing securities. Again, check your local libraries. A lot of the public information you may be looking for can be found on Yahoo Finance, for free, from home. Yahoo finance, will give financial information, ratios, news, filings, analysis, all in one place. |
Filing a corporation tax return online? | This may not exactly answer your question but, as a small business owner, I would highly recommend having a professional handle your taxes. It is worth the money to have it done correctly rather than doing something wrong and getting audited or worse having penalties assessed and owing more than you thought would be possible. I would recommend this especially if this is how you make your primary income, you can always write it off as a business expense. |
which types of investments should be choosen for 401k at early 20's? | Split your contributions evenly across the funds on that list with the word "core" or "S&P" in the name. Maybe add "International Large Cap Index". Leave it & rebalance occasionally. Read a book on Modern Portfolio Theory sometime in the next 5 years. |
Why do 10 year Treasury bond yields affect mortgage interest rates? | yield on a Treasury bond increases This primarily happens when the government increases interest rates or there is too much money floating around and the government wants to suck out money from the economy, this is the first step not the other way around. The most recent case was Fed buying up bonds and hence releasing money in to the economy so companies and people start investing to push the economy on the growth path. Banks normally base their interest rates on the Treasury bonds, which they use as a reference rate because of the probability of 0 default. As mortgage is a long term investment, so they follow the long duration bonds issued by the Fed. They than put a premium on the money lent out for taking that extra risk. So when the governments are trying to suck out money, there is a dearth of free flowing money and hence you pay more premium to borrow because supply is less demand is more, demand will eventually decrease but not in the short run. Why do banks increase the rates they loan money at when people sell bonds? Not people per se, but primarily the central bank in a country i.e. Fed in US. |
Why do some symbols not have an Options chain for specific expiration dates? | All openly traded securities must be registered with the SEC and setup with clearing agents. This is a costly process. The cost to provide an electronic market for a specific security is negligible. That is why the exchange fees per electronic trade are so small per security. It is so small in fact that exchanges compensate price makers partially at the expense of price takers, that exchanges partially give some portion of the overall fee to those that can help provide liquidity. The cost to provide an open outcry market for a specific security are somewhat onerous, but they are initiated before a security has any continual liquidity to provide a market for large trades, especially for futures. Every individual option contract must be registered and setup for clearing. Aside from the cost to setup each contract, expiration and strike intervals are limited by regulation. For an extremely liquid security like SPY, contracts could be offered for daily expiration and penny strike intervals, but they are currently forbidden. |
Can you explain this options calls & puts quote table to me? | (Note: I am omitting the currency units. While I strongly suspect it's US$ I don't know from the chart. The system works the same no matter what the currency.) A call or a put is the right to sell (put) or buy (call) shares at a certain price on a certain day. This is why you see a whole range of prices. Not all possible stock values are represented, the number of possibilities has to be kept reasonable. In this case the choices are even units, for an expensive stock they may be spaced even farther apart than this. The top of the chart says it's for June. It's actually the third Friday in the month, June 15th in this case. Thus these are bets on how the stock will move in the next 10 days. While the numbers are per share you can only trade options in lots of 100. The left side of the chart shows calls. Suppose you sell a call at 19 (the top of the chart) The last such trade would have gotten you a premium of 9.70 per share (the flip side of this is when the third friday rolls around it will most likely be exercised and they'll be paying you only 19 a share for a stock now trading at something over 26.) Note the volume, bid and ask columns though--you're not going to get 9.70 for such a call as there is no buyer. The most anybody is offering at present is 7.80 a share. Now, lets look farther down in the chart--say, a strike price of 30. The last trade was only .10--people think it's very unlikely that FB will rise above 30 to make this option worthwhile and thus you get very little for being willing to sell at that price. If FB stays at 26 the option will expire worthless and go away. If it's up to 31 when the 15th rolls around they'll exercise the option, take your shares and pay you 30 for them. Note that you already gave permission for the trade by selling the call, you can't back out later if it becomes a bad deal. Going over to the other side of the chart with the puts: Here the transaction goes the other way, come the 15th they have the option of selling you the shares for the strike price. Lets look at the same values we did before. 19? There's no trading, you can't do it. 30? Here you will collect 3.20 for selling the put. Come the 15th they have the right to sell you the stock for 30 a share. If it's still 26 they're certainly going to do so, but if it's up to 31 it's worthless and you pocket the 3.20 Note that you will normally not be allowed to sell a call if you don't own the shares in question. This is a safety measure as the risk in selling a call without the stock is infinite. If the stock somehow zoomed up to 10,000 when the 15th rolls around you would have to come up with the shares and the only way you could get them is buy them on the open market--you would have to come up with a million dollars. If there simply aren't enough shares available to cover the calls the result is catastrophic--whoever owns the shares simply gets to dictate terms to you. (And in the days of old this sometimes happened.) |
Anticipating being offered stock options in a privately held company upon employment. What questions should I ask? | The company doesn't necessarily have to go public. They can also be worth money if the company is acquired. Also keep in mind that even if the company does eventually go public, your shares can essentially be wiped out by a round of pre-IPO funding that gives the company a low valuation. You could ask: |
How to calculate car insurance quote | Does the Insurance value differ from state to state (for example I've a car in Hawaii and there is another car in Illinois with same model, make and same features), does the Insurance vary for both? Yes, quotes will vary based on where you live for various reasons, (propensity for accidents, value of cars, etc.), and state laws regarding required car insurance can vary. How is the insurance quote calculated? It's likely a proprietary formula that the insurance company will not disclose. If they did, they could be giving away a competitive advantage. However, like all insurance, the goal is to determine the probability of the insured having an accident, and the projected cost of such an accident. That will be based on actuarial tables for each of the risk factors you mention. |
That “write your own mortgage” thing; how to learn about it | You are asking about a common, simple practice of holding the mortgage when selling a house you own outright. Typically called seller financing. Say I am 70 and wish to downsize. The money I sell my house for will likely be in the bank at today's awful rates. Now, a buyer likes my house, and has 20% down, but due to some medical bills for his deceased wife, he and his new wife are struggling to get financing. I offer to let them pay me as if I were the bank. We agree on the rate, I have a lien on the house just as a bank would, and my mortgage with them requires the usual fire, theft, vandalism insurance. When I die, my heirs will get the income, or the buyer can pay in full after I'm gone. In response to comment "how do you do that? What's the paperwork?" Fellow member @littleadv has often posted "You need to hire a professional." Not because the top members here can't offer great, accurate advice. But because a small mistake on the part of the DIY attempt can be far more costly than the relative cost of a pro. In real estate (where I am an agent) you can skip the agent to hook up buyer/seller, but always use the pro for legal work, in this case a real estate attorney. I'd personally avoid the general family lawyer, going with the specialist here. |
How can I get a mortgage I can't afford? | You might also want to talk directly to a bank. If your credit report is clean, they may have some discretion in making the loan. Note - the 'normal' fully qualified loan has two thresholds, 28% (of monthly income) for housing costs, 36% for all debt servicing. A personal, disclosed loan from a friend/family which is not secured against the house, would count as part of the other debt, as would a credit card. While I don't recommend using a credit card for this purpose, the debt fits in that 28-36 gap. As Kevin points out below, not all paths are equally advisable. Nor are rules of thumb always true. Not having the OP's full details, income, assets, price of house, etc, this is just a list of things to consider. The use of a 401(k) loan in the US can be a great idea for some, bad mistake for others. This format doesn't make it easy to go into great detail, and I'm sure the 401(k) loan issue has been asked and answered in other questions. With respect to Kevin, if he wrote 'usually', I'd agree, but never say 'never.' |
Is it wise to sell company stock to pay down a mortgage? | Simply if your stock is still rising in price keep it. If it is falling in price sell it and pay off your mortgage. To know when to do this is very easy. If it is currently rising you can put a trailing stop loss on it and sell it when it drops and hits your stop loss. A second easy method is to draw an uptrend line under the increasing price and then sell when the price drops down below the uptrend line, as per the chart below. This will enable you to capture the bulk of the price movement upward and sell before the price drops too far down. You can then use the profits (after tax) to pay down your mortgage. Of course if the price is currently in a downtrend sell it ASAP. |
Can I use a different HSA than PayFlex that came with aetna? | Much of this is incorrect. Aetna owns Payflex for starters, and it's your EMPLOYER who decides which banks and brokers to offer, not Payflex. An HSA is a checking account with an investment account option after a minimum balance is met. A majority of U.S. employers only OFFER an HSA option but don't contribute a penny, so you're lucky you get anything. The easy solution is just keep the money that is sent to your HSA checking account in your checking account, and once a year roll it over into a different bank's HSA. The vast majority of banks offer HSAs that have no ties to a particular broker (i.e. Citibank, PNC, Chase). I have all my HSA funds in HSA Bank which is online but services lots of employers. Not true that most payroll deductions or employer contributions go to a single HSA custodian (bank). They might offer a single bank that either contracts with an investment provider or lets you invest anywhere. But most employers making contributions are large or mid-market employers offering multiple banks, and that trend is growing fast because of defined contribution, private exchanges and vendor product redesigns. Basically, nobody likes having a second bank account for their HSA when their home bank offers one. |
A University student wondering if investing in stocks is a good idea? | You can start investing with any amount. You can use the ShareBuilder account to purchase "partial" stocks through their automatic investment plan. Usually brokers don't sell parts of stock, and ShareBuilder is the only one allowing it IMHO using its own tricks. What they do basically is buy a stock and then divide it internally among several investors who bought it, while each of the investors doesn't really own it directly. That's perfect for investing small amounts and making first steps in investing. |
Is it a bet on price fluctuations and against the house? | The answer depends on the specific instrument to which you are referring. It is possible to make straight bets that are cash-settled and in which the underlying commodity or instrument will never be bought or sold. It is also possible to have such a contract be settled in the underlying (if the cash value is appropriate, then the cash settlement can be used to purchase the underlying directly, if necessary). Physical delivery was predominant until the last few decades. Most traders, as opposed to hedgers or strategics, are going to prefer cash-settled contracts as opposed to physical delivery. It is possible to make trades with a brokerage firm such that the firm pays if the trader wins the bet. The firm will typically find parties on the other side to even out this bet and leave itself neutral as to the outcome (plus a small premium it charges each side for the cost of making the market). The cost charged to one contracting party should be set by the dealer in relation to prices being charged to parties making the opposite, matching bet (in this way, brokers are following market price, while traders are setting it). Financially, options and contracts can be settled for cash or for the underlying, and they can be made directly with the opposite bettor or with a neutral dealer. |
Is gold really an investment or just a hedge against inflation? | The problem I have with gold is that it's only worth what someone will pay you for it. To a degree that's true with any equity, but with a company there are other capital resources etc that provide a base value for the company, and generally a business model that generates income. Gold just sits there. it doesn't make products, it doesn't perform services, you can't eat it, and the main people making money off of it are the folks charging a not insubstantial commission to sell it to you, or buy it back. Sure it's used in small quantities for things like plating electrical contacts, dental work, shielding etc. But Industrial uses account for only 10% of consumption. Mostly it's just hoarded, either in the form of Jewelry (50%) or 'investment' (bullion/coins) 40%. Its value derives largely from rarity and other than the last few years, there's no track record of steady growth over time like the stock market or real-estate. Just look at what gold prices did between 10 to 30 years ago, I'm not sure it came anywhere near close to keeping pace with inflation during that time. If you look at the chart, you see a steady price until the US went off the gold standard in 1971, and rules regarding ownership and trading of gold were relaxed. There was a brief run up for a few years after that as the market 'found its level' as it were, and you really need to look from about 74 forward (which it experienced its first 'test' and demonstration of a 'supporting' price around 400/oz inflation adjusted. Then the price fluctuated largely between 800 to 400 per ounce (adjusted for inflation) for the next 30 years. (Other than a brief sympathetic 'Silver Tuesday' spike due to the Hunt Brothers manipulation of silver prices in 1980.) Not sure if there is any causality, but it is interesting to note that the recent 'runup' in price starts in 2000 at almost the same time the last country (the Swiss) went off the 'gold standard' and gold was no longer tied to any currency (or vise versa) If you bought in '75 as a hedge against inflation, you were DOWN, as much as 50% during much of the next 33 years. If you managed to buy at a 'low' the couple of times that gold was going down and found support around 400/oz (adjusted) then you were on average up slightly as much as a little over 50% (throwing out silver Tuesday) but then from about '98 through '05 had barely broken even. I personally view 'investments' in gold at this time as a speculation. Look at the history below, and ask yourself if buying today would more likely end up as buying in 1972 or 1975? (or gods forbid, 1980) Would you be taking advantage of a buying opportunity, or piling onto a bubble and end up buying at the high? Note from Joe - The article Demand and Supply adds to the discussion, and supports Chuck's answer. |
What is the cause of sudden price spikes in the FOREX market? | It depends on the currency pair since it is much harder to move a liquid market like Fiber (EURUSD) or Cable (GBPUSD) than it is to move illiquid markets such as USDTRY, however, it will mostly be big banks and big hedge funds adjusting their positions or speculating (not just on the currency or market making but also speculating in foreign instruments). I once was involved in a one-off USD 56 million FX trade without which the hedge fund could not trade as its subscriptions were in a different currency to the fund currency. Although it was big by their standards it was small compared with the volumes we expected from other clients. Governments and big companies who need to pay costs in a foreign currency or receive income in one will also do this but less frequently and will almost always do this through a nominated bank (in the case of large firms). Because they need the foreign currency immediately; if you've ever tried to pay a bill in the US denominated in Dollars using Euros you'll know that they aren't widely accepted. So if I need to pay a large bill to a supplier in Dollars and all I have is Euros I may move the market. Similarly if I am trying to buy a large number of shares in a US company and all I have is Euros I'll lose the opportunity. |
Investing for Dummys | Books are a great place to start, Jason Kelly's The Neatest Little Guide to Stock Market Investing will give you a broad foundation of the stock & bond market. |
Why don't brokerages charge commissions on forex trades? | Investopedia has a section in their article about currency trading that states: The FX market does not have commissions. Unlike exchange-based markets, FX is a principals-only market. FX firms are dealers, not brokers. This is a critical distinction that all investors must understand. Unlike brokers, dealers assume market risk by serving as a counterparty to the investor's trade. They do not charge commission; instead, they make their money through the bid-ask spread. Principals-only means that the only parties to a transaction are agents who actively bear risk by taking one side of the transaction. There are forex brokers who charge what's called a commission, based on the spread. Investopedia has another article about the commission structure in the forex market that states: There are three forms of commission used by brokers in forex. Some firms offer a fixed spread, others offer a variable spread and still others charge a commission based on a percentage of the spread. So yes, there are forex brokers who charge a commission, but this paragraph is saying mostly the same thing as the first paragraph. The brokers make their money through the bid-ask spread; how they do so varies, and sometimes they call this charge a commission, sometimes they don't. All of the information above differs from the stock markets, however, in which The broker takes the order to an exchange and attempts to execute it as per the customer's instructions. For providing this service, the broker is paid a commission when the customer buys and sells the tradable instrument. The broker isn't taking a side in the trade, so he's not making money on the spread. He's performing the service of taking the order to an exchange an attempting to execute it, and for that, he charges a commission. |
Is it true that more than 99% of active traders cannot beat the index? | What decision are you trying to make? Are you interested day trading stocks to make it rich? Or are you looking at your investment options and trying to decide between an actively managed mutual fund and an ETF? If the former, then precise statistics are hard to come by, but I believe that 99% of day traders would do better investing in an ETF. If the latter, then there are lots of studies that show that most actively managed funds do worse than index funds, so with most actively managed funds you are paying higher fees for worse performance. Here is a quote from the Bogleheads Guide to Investing: Index funds outperform approximately 80 percent of all actively managed funds over long periods of time. They do so for one simple reason: rock-bottom costs. In a random market, we don't know what future returns will be. However, we do know that an investor who keeps his or her costs low will earn a higher return than one who does not. That's the indexer's edge. Many people believe that your best option for investing is a diverse portfolio of ETFs, like this. This is what I do. |
Why do credit card transactions take up to 3 days to appear, yet debit transactions are instant? | Take a look at http://en.wikipedia.org/wiki/Payment_gateway There is essentially a lead time between when the transaction is made and when it is settled, 2-3 business days is the lead time for settlement. The link explains the process step-by-step |
Is there a White-list of Trusted Online Vendors? | I'm going to go with "ridiculous notion." :) The vast majority of businesses are legitimate, run by honest people trying to earn a living for themselves and their employees. These days, almost all of them accept credit cards. Crooked businesses are a very small minority. When a bad business over charges you, you dispute the charge, and you get your money back. But that's not all that happens. The bad merchant pays penalties for this, and if it happens more than a couple of times, the merchant loses their merchant account with their bank, which means that they lose their ability to accept credit card payments anymore. A crooked business is not able to rob people via credit card for very long at all. A whitelist would certainly not be able to include every legitimate business. And a blacklist would never be able to be kept up-to-date, as bad businesses come and go continuously; as soon as a business was added to the blacklist, they would lose their merchant account and would no longer need to be on the list. What you are describing is very rare. My brother once had a bad experience with a tech support company where they were repeatedly charging him for a service they never performed. But a credit card chargeback took care of it. If that company made a habit of that, I'm sure that they got in trouble with their bank. Instead, the most common credit card fraud happens when crooks use your credit card at perfectly legitimate businesses. But your whitelist/blacklist wouldn't help you with that at all. |
Short term cutting losses in a long term investment | If you are investing for 10 years, then you just keep buying at whatever price the fund is at. This is called dollar-cost averaging. If the fund is declining in value from when you first bought it, then when you buy more, the AVERAGE price you bought in at is now lower. So therefore your losses are lower AND when it goes back up you will make more. Even if it continues to decline in value then you keep adding more money in periodically, eventually your position will be so large that on the first uptick you will have a huge percent gain. Anyway this is only suggested because you are in it for 10 years. Other people's investment goals vary. |
First Job, should I save or invest? | Congrats on your first real job! Save as much as your can while keeping yourself (relatively) comfortable. As to where to put your hard earned money, first establish why you want to save the money in the first place. Money is a mean to acquire the things we want or need in your life or the lives of others. Once your goals are set, then follow this order: |
Can I use an HSA to pay financed payments for LASIK? | From HSA Resources - I understand that I can reimburse myself from my HSA for qualified medical expenses that I pay out-of-pocket but is there a time limit? Do I need to reimburse myself in the same year? You have your entire lifetime to reimburse yourself. As long as you had your HSA established at the time the expense was incurred, you save the receipt and it was not otherwise reimbursed, you can reimburse yourself for the expense from your HSA even years later. The important thing not asked or mentioned above is that the HSA must be in place before the expense occurred. In your case, should the LASIK procedure be before the HSA is established, it's not an eligible expense. |
What do “cake and underwear” stocks refer to? | There are some euphemisms that are better known than others. A category of stocks that's suitable for "widows and orphans" would be stocks that are low beta, and perhaps high dividend. Safe (being relative) enough to put a window's money into. The term "cake and underwear" appears to me to be a Buffetism. And I'd interpret it to mean,"not tech, not stocks that are either high growth or cyclic, but stocks that make things that have steady demand and that most consumers use." Google the phrase, only Buffet comes up. |
Are COBRA premiums deductible when self-employed? | http://www.ehow.com/about_4625753_cobra-as-selfemployed-health-insurance.html This link makes it clear... it has to be itemized, and is subject to the > than 7.5% AGI rule. |
Are you allowed to have both a 401(k) and a SIMPLE IRA? If so, what about limits? | I am not 100% sure, but I think the answer is this: You can't max out both. You could theoretically max out the SIMPLE IRA ($11,500) and then contribute $4,000 to your 401k, but your total can't exceed the 401k limit of $16,500. This also means you could max out your 401k at $16,500, but you couldn't contribute anything to the SIMPLE IRA. Note that no matter what, you can't contribute more than $11,500 to your SIMPLE IRA. (Note that this is all independent from your Traditional or Roth IRA, which are subject to their own limits, and not affected by your participation in employer-sponsored plans.) As I understand it, a 401k and a SIMPLE IRA both fall under the umbrella of "employer-sponsored plans". Just like you can't max out two 401k's at two different employers, you can't do it with the 401k and the SIMPLE IRA. The only weird thing is the contribution limit differences between SIMPLE IRA and 401k, but I don't think the IRS could/would penalize you for working two jobs (enforcing the lower SIMPLE IRA limit for all employer-sponsored retirement accounts). You should probably run the numbers, factoring in the employer match, and figure out which account-contribution scenario makes the most financial sense for you. However, I'm not sure how the employer match helps you when you're talking about a small business that you own/run. You may also want to look at how the employer match of the SIMPLE IRA affects the taxes your business pays. Disclaimer #1: I couldn't find a definitive answer on your specific scenario at irs.gov. I pieced the above info from a few different "SIMPLE IRA info" sites. That's why I'm not 100% sure. It seems intuitively correct to me, though. Does your small business have an accountant? Maybe you should talk to him/her. Disclaimer #2: The $ amounts listed above are based on the IRS 2010 limits. |
Will a small investment in a company net a worthwhile gain? | If you bought 5 shares @ $20 each that would cost you $100 plus brokerage. Even if your brokerage was only $10 in and out, your shares would have to go up 20% just for you to break even. You don't make a profit until you sell, so just for you to break even your shares need to go up to $24 per share. Because your share holding would be so small the brokerage, even the cheapest around, would end up being a large percentage cost of any overall profits. If instead you had bought 500 shares at $20, being $1000, the $20 brokerage (in and out) only represents 2% instead of 20%. This is called economies of scale. |
Understanding the phrase “afford to lose” better | Well.... If you have alllll your money invested, and then there's a financial crisis, and there's a personal crisis at the same time (e.g. you lose your job) then you're in big trouble. You might not have enough money to cover your bills while you find a new job. You could lose your house, ruin your credit, or something icky like that. Think 2008. Even if there's not a financial crisis, if the money is in a tax-sheltered retirement account then withdrawing it will incur ugly penalities. Now, after you've got an emergency fund established, things are different. If you could probably ride out six to twelve months with your general-purpose savings, then with the money you are investing for the long term (retirement) there's no reason you shouldn't invest 100% of the money in stocks. The difference is that you're not going to come back for that money in 6 months, you're going to come back for it in 40 years. As for retirement savings over the long term, though, I don't think it's a good idea to think of your money in those terms. If you ever lose 100% of your money on the stock market while you've invested in diversified instruments like S&P500 index funds, you're probably screwed one way or another because that represents the core industrial base of the US economy, and you'll have better things to worry about, like looking for a used shotgun. Myself, I prefer to give the suggestion "don't invest any money in stocks if you're going to need to take it out in the next 5 years or so" because you generally shouldn't be worried about a 100% loss of all the money in stocks your retirement accounts nearly so much as you should be worried about weathering large, medium-term setbacks, like the dot-com bubble crash and the 2008 financial crisis. I save the "don't invest money unless you can afford to lose it all" advice for highly speculative instruments like gold futures or social-media IPOs. Remember also that while you might lose a lot of your money on the stock market, your savings accounts and bonds will earn you pathetic amounts by comparison, which you will slowly lose to inflation. If you've had your money invested for decades then even during a crash you may still be coming out ahead relative to bonds. |
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