Investing Information

Day Trading Strategy or Stock Trading Software? The Way You Pick Stocks Affects Your Results

The trading method you employ to approach the stock market can make a big difference in your results.

Advice for International Investors on How to Safeguard Their Profits

What are the risks?

Discover the Foundation of Retiring Wealthy - The IRA!

Let me tell you about some legal ways to avoid getting taxed on profits from the stock market. You can make a lot of money now with the stock market as low as it is at this time as I teach you in my home study course. The very best way is to buy and sell your stock through Individual Retirement Accounts (IRAs). IRAs can help you legally avoid taxes and add a fantastic boost to your retirement plans. The IRA was originally developed in 1974 for people not covered by a company pension plan. "The individual retirement account legislation allowed the average person a chance to put money into a tax-advantaged account," according to Bruce Grace, a Chartered Financial Analyst and Assistant Professor of Finance at Morehead State University.

Almost Anyone Can Open A Roth IRA!

The Roth is kind of weird until you get used to it in terms of how much you can put in (contribute) each year depending on how much you earn (compensation). Because of this you really have two limits, one dealing with your compensation and the other dealing with your contribution. Let me explain.

Mutual Fund Returns May Not Be As They Seem!

Arthur Levitt, during his tenure at the SEC, experienced many cases where the non-indexed mutual fund manager bought shares for their own accounts before the fund bought the shares. The fund?s purchases drove up the price of the stocks and the fund manager?s made a killing on the deal. This is called ?front running,? and is illegal under securities laws.

Invisible Mutual Fund Fees Erode Your Returns!

Many investors think that investing in mutual funds is free. What nonsense! Funds collect more than $50 billion a year in fees from investors. That is truly a ton of money. The first way you get hosed in a mutual fund is due to high fees charged. These fees can dramatically reduce your returns over time!

Caveat Emptor: You May Owe Taxes Despite 401(K) Losses!

One among many ways you lose money in non-indexed mutual funds is the tax trap. You may have to pay taxes even when your mutual fund loses money! To many people this is painfully unexpected. Here is how this counter intuitive event occurs. By law, mutual funds do not pay taxes. Instead, they pass on those taxes to you, the shareholder in the mutual fund. If the fund manager sells a stock for more than it cost the fund a profit is generated. This profit is called a capital gain and it is taxable. Capital gains are taxed at your ordinary income tax rate which is between 28% and 38.6% for most investors if the fund held the stock for less than a year. If the stock was held for more than a year, in other words long term, the tax is 20%.

A Safe Port For Mutual Funds But Not You!

Soft dollars, a form of legal kickback, is a sly way you can get ripped off by mutual fund managers. Full service brokers give these kickbacks to non-indexed mutual funds in the form of a ?rebate? to purchase research, software, and even computer equipment.

Mutual Fund Selection Made Simple By Indexing!

Non-indexed mutual funds try to keep it secret that actively managed mutual very funds rarely do better stock market indexes. The higher fees of the managed funds really make it hard for these funds to out compete indexed funds. Smart financial journalists occasionally rat out fund managers for not educating the public in this regard. When this happens the mutual fund managers make a feeble attempt at self defense by pointing to something called the 5% rule.

The Past Does Not Equal The Future: Mutual Fund Returns!

A way that investors get ripped off and in a sense rip themselves off is based on the culture of performance in the mutual fund industry. If you stop and think about it there is absolutely no reason that the past has to equal the future. If you have not been particularly successful as a stock investor in the past, for instance, there is no reason that you won?t be unsuccessful in the future. One reason I hope that you are reading this article is that you want to improve as an investor.

Missleading Fund Names Wreak Havoc On Investor Returns!

Mutual fund managers use fake fund names to part you from your money such that you cannot judge what a fund does by its name. Many funds have names that are outright misleading or even deceptive. In the late 1990?s, for instance, during the technology stock bubble, some portfolio managers took advantage of public?s desire to chase the latest fad by slapping ?internet? in front of their fund names.

Four Key Components To Building A Trading System

Need some insight on what you should really be striving for when you're building a mechanical trading system? When it comes down to it, there are really only a few criteria that are used in judging the merits of a trading system. The most obvious one is profitability - does the system work? But really, there's more to it than just that. The number of wins versus the number of losses is important too, but there's a lot of latitude there if the profitability is high. The size of the average win versus the size of the average loss tends to be held as important, and it is. However, that criteria is correlated to the number of wins and losses, so again, there's a lot of leeway there. The one thing that is too often overlooked is the consistency of a system. The fancier term for this is 'drawdown', but it's just a matter of consistency.....you'll see why below. Each of these four components is examined below, and then some of the common mistakes made when folks start building trading systems are discussed.

In a Time of Need

As I take my leisurely walk with my dog through the older section of the local cemetery, I pause to read the details on the barely legible, weathered headstones. I am fascinated with the dates, for I know each stone has a story to tell, a history of its own time and place, but only enough space for identity. Proceeding up the rolling asphalt pathway, I am led into the new section of the cemetery. It becomes crystal clear as I compare the cemetery?s old sections with the new, Americans are living longer.

Before You Start Investing

There maybe several reasons why you to want to invest your money. You may want to retire early, want to build your own business in the future, or to pay for your kid?s education. Should everyone start investing outside their retirement accounts right away? The answer to this question is that it depends on your financial situation. First, you must have a basic understanding in financial management. What would happen if you lose your job, accumulate large medical expenses, or losing money on your investments? Do you still have money to pay your bills? Do you have to sell your investments that you have worked so hard for, with a loss? No one knows what the future will bring. Therefore, you must have a safety net to fall back on in an unexpected event. This article contains 5 concepts that you should follow before you start investing outside of your retirement accounts.

Find Your Investing Soulmate on the Jersey Turnpike

As a followup to a previous column, ?Irreconcilable Differences,? I received an e-mail from a reader asking how she could ensure, ahead of time, investment compatibility with a future spouse.

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Selecting Rules for Investing and Trading
There are three important differences between investing and trading. Overlooking them can lead to confusion. A beginning trader, for example, may use the terms interchangeably and misapply their rules with mixed and unrepeatable results. Investing and trading become more effective when their differences are clearly recognized. An investor's goal is to take long term ownership of an instrument with a high level of confidence that it will continually increase in value. A trader buys and sells to capitalize on short term relative changes in value with a somewhat lower level of confidence. Goals, time frame and levels of confidence can be used to outline two completely different sets of rules. This will not be an exhaustive discussion of those rules but is intended to highlight some important practical implications of their differences. Long term investing is discussed first followed by short term trading.

Planning Starts with the Basics
When developing a plan for your finances, the toughest question often is: "Where do I begin?" Before investing in stocks and bonds or buying life insurance, before implementing any change or making any decisions, you first need to analyze and understand your entire financial picture. Two documents allow you to do just that. A Balance Sheet and a Cash Flow Statement enable you to take an in-depth look at your current financial situation and make better decisions about the future. With a little work, you can develop these two tools and be on your way to a solid plan for your finances.

Help with My Annuity
The cries are heard from the distance, "I need help with my annuities." Nothing has changed...just a lonely senior who can't trust anybody with her annuity because every time she asks for advice, someone tries to make her invest in a different annuity...Sound familiar? Well you are not alone.

Gold and Silver Maple Leafs Get New Packaging
Gold Maple Leafs and Silver Maple Leafs are receiving packaging makeovers, changes clearly mandated by investor disfavor with packaging that the Royal Canadian Mint has used since the coins were introduced. Gold Maple Leafs debuted in 1979, Silver Maple Leafs in 1988. The changes appear to be good moves, which should increase sales of Silver Maple Leafs and help keep Gold Maple Leafs the preferred pure (.9999 fine) gold bullion coins.

Raising Capital Using a Public Company
Going public in this manner is ideal for companies that may not be large enough to attract an underwriter for an IPO and those that don't need to raise capital immediately. They want to go public because of the many benefits that being a public company offers such as increased valuation, using public stock as currency to acquire other companies and assets, liquidity, prestige and to reduce the need for expensive venture capital and other financing sources. It also makes it easier to raise capital since once you become public it gives you credibility and a benchmark trading price to raise capital against.

It?s Never too Early to Start Investing!
Remember the old saying, "never too late to start"? Well, try this on for size: when it comes to investing, it's never too early to start. Time really is of the essence here. Those of us who find ourselves between the ages of twenty and forty should make investing for retirement a key priority on our list of things to do.

Raising Capital in Today?s ?New Economy?
We've helped a number of clients develop business plans and raise capital from "angel" investors, corporate entities and venture capitalists during the last 6-8 years. It's always a daunting process that can be full of pitfalls and require a tremendous amount of work ? but it can be done! Here is some perspective gleaned from years of experience.

The Convertible Craze Brightens The Future Of Equities
Convertibles are stealing the show with their safe investment image in today's "protective" market. They seem to be overshadowing the stocks and bonds, and this holds true for the mediocre issuers.

Types of Investment
The word 'investments' is one that most of us are familiar with hearing in financial context. For many of us, it may make us thing of big business and vasts sums of money, but there's much to the world of investments than multi-million dollar deals.

Part II of Day Traders and Swing Traders and Options? Maybe!
Before every protective put trade it is possible to calculateyour anticipated maximum loss. Use the formula: (stock priceminus strike price) plus option price. For example, suppose youwill pay $30.00 for your stock, and you want no more than a $3.50loss on the position. Then you would choose the $27.50 strikeput which costs $1.00. Following the formula, you take yourstock price ($30.00) and subtract the put's strike price (27.50)which leaves you $2.50. To this $2.50 loss, you then add theamount you spent on the option ($1.00), which gives you acombined, maximum loss of $3.50 for this position. You can setyour loss limit by the strike price of the put you buy and thecost of the put. This formula will work every time. Remember,stock loss, (stock price paid - strike price), plus option cost(option price) equals maximum potential position loss.

Emotions: A Traders Worst Enemy; Get Rid of Fear and Greed - Youll be Glad You Did
You hear it over and over and over in books, forums, and chatrooms. Fear and greed, fear and greed, fear and greed. Emotions are a trader's worst enemy. What are we supposed to do about it? We are human after all. Human beings have emotions. We can't just throw a switch and suddenly behave like "Data" on Star Trek the Next Generation.

Will a Falling Dollar Derail Your Plans for Retirement?
How much are you willing to pay for a tank of gas? We've all watched as gas prices hit record highs, but what would you do if you filled your tank and paid by credit card only to discover on your monthly statement that you paid $80 to fill an economy car. No, this is not some future doomsday projection of oil prices. This scenario recently happened to a colleague on business in Europe.

Dont Catch a Falling Knife
One of the most common mistakes made by inexperienced investors is trying to "catch a falling knife". This is the phrase used to describe the habit of buying stocks that are in "freefall", and is a poor strategy, albeit common among new investors. Sadly, it is a common practice even among old and experienced investors. I've even fallen prey to it myself.

Is Offshore Banking for You?
You've probably heard about people who keep their money offshore. Most likely you assume they're all wealthy businessmen; millionaires, who have so much money they somehow 'qualify' to move it out of the country, right? Wrong! Offshore banking can be a benefit for anybody regardless of income.

Going Against the Conventional Investment Wisdom
First of all, I want to give everyone the disclaimer that I am not a registered financial advisor and I don't play one on TV. Therefore, I cannot legally provide financial advice and I will not do so. This is for informational purposes only and I'm not recommending any of my personal investment strategies to anyone else. Now, with that being said, I will outline some techniques I use for my personal investment strategy, without going into a whole lot of specifics. I generally go against the conventional investment wisdom that you are accustomed to hearing, although I do use both a conservative and a not-so-conservative strategy.

Rolling your 401k: Contributory IRA vs. Rollover IRA
In an ideal world you would start your working career with a great company in your early 20s, steadily climb the corporate ladder, retire at age 65, and draw a sufficient income from your accumulated 401k account to live happily ever after.

How to Invest Overseas - Intelligently!
In recent months, many advisors have talked a lot about the wisdom of investing overseas, but most have failed to really address the way to do that. For new investors, investing in the U.S. is challenging enough, but investing across borders is often even more daunting.

Investing 101: Risk Terminology - BETA
About thirty years ago, statisticians armed with all of theirstatistical theories began to confront the financial markets. Ahandful of useful tools emerged that the average investor shouldbe familiar with when they look to purchase stocks.

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Are you ready to open your pathway to financial independence?

Trading Is Not Rocket Science!
Despite what some people may lead you to believe; day trading, swing trading and trend trading is not anywhere as difficult as they would like you to think. It really boils down to two key components.

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