Investors seeking an income stream from their holdings gravitate to either bonds or stocks which pay a dividend. Many stocks do not pay a dividend, and consequently there is no income provided from their ownership until the position is sold. Cash flow is especially important to those just entering retirement when income from investments becomes [...]
Continue reading...16. July 2010
Many Americans plan for their retirements with an employer-sponsored 401K plan. A 401K allows you to invest pre-tax money, and not pay taxes on the investment gains within the account until you withdraw the money upon retirement. Deferring taxation to this degree greatly accelerates the returns within the account helping you save more efficiently for [...]
Continue reading...13. July 2010
All you have to do is look around to realize that the economy has been shaky for quite some time. Unemployment is on the rise, markets are uncertain, and people are struggling to get by. When the economy has been down historically, gold has tended to increase in value, and today is no exception. In [...]
Continue reading...27. June 2010
The VIX is the acronym standing for the CBOE volatility index. In simple terms, it is a number which represents the current volatility of the stock market. There are times which the stock market seems stuck in a narrow range and only moves a tiny fraction day to day. During these times, the VIX is [...]
Continue reading...24. June 2010
FOREX (or FX) stands for foreign exchange, and it is the markets where currencies of all countries are traded against each other. FOREX markets have volume which dwarf any other, including the stock and commodities exchanges. Current estimates are that over $1 trillion changes hands within FOREX markets on a daily basis. Participants arrive in [...]
Continue reading...18. June 2010
Many saving for their retirements are afraid that runaway government spending will create severe inflation thus diluting the eventual value of their investment portfolios. Those nearing retirement with investments primarily focused on fixed income are especially vulnerable to rising inflation. When inflation goes up, then the purchasing power of your dollars goes down. Savers and [...]
Continue reading...12. June 2010
Many investors assume that options are complex and risky. In most scenarios, they are correct. However, there are certain uses of stock options which are quite conservative in nature, and can serve to reduce the risk already present within your stock portfolio. It is no revelation to anyone reading this that the stock market can [...]
Continue reading...3. June 2010
A dividend is akin to a profit distribution paid to you by the company you own stock in. A stock’s “yield” equates to the rate of return its dividend pays when calculated against its current trading price. For example, assume XYZ company is trading at $20 per share, and it pays an annual dividend of [...]
Continue reading...31. May 2010
The media, along with politicians, love to lambaste shortsellers and claim that they are the culprits behind stock market declines. When you sell short a stock you are betting that it will go down. Logistically, you “borrow” shares of the stock with a future promise to return them, and then you sell those shares on [...]
Continue reading...24. May 2010
It used to be that only hedge funds and high net worth individuals could include instruments like commodities, currencies and sophisticated index-based derivatives within their aggregate portfolios. Now, using the power of Exchange Traded Funds (ETF’s), the individual investor can now take advantage of the movement of precious metals, currencies, commodities or market sector indices [...]
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22. July 2010
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