The key to investing success is finding asymmetric risks and rewards. Over time, if you consistently invest your money into assets with small downside potential but huge upside potential, you will see huge returns. It is a well documented fact that finding asymmetric risk through the stock exchange is a struggle. Professional fund managers who […]
Every brokerage account has what is called a “sweep” feature or sweep account. It can be both a benefit or a detriment depending on how you use it and what options you selected when you set it up. When you setup a new brokerage account, you usually have to assign what you do with your […]
The Fraud Research Center estimates that Americans lose $40-$50 Billion dollars to fraud every single year, and up to 17% of the adult population falls victim to some form of financial fraud in a given year. Most of us believe that we’re too smart to fall prey to financial fraud, but successful fraudsters trick smart […]
A big part of investing is knowing what NOT to invest in. For me, I like to invest in companies with a solid plan to profitability, that even a monkey could run, like utility stocks. However, it is essential to avoid companies that have no solid profitability plans, like Best Buy. Here is what I’m […]
I’m a big believer in starting to invest early. It’s one of the smartest ways to build wealth. But when I talk to millennials, fear is holding them back from starting to investing. The #1 fear I hear almost every week is this: I’m afraid to start investing because I’m afraid of losing all my […]
Before you start investing you need to first assess your risk tolerance. Here are a few super easy ways to do that. This will be an immense help when it’s time to start investing!
Last Century, the DJIA index moved from two digits to five digits crossing 11000. There is no reason to disbelieve its journey forward this century.
When it comes to investing getting started is half the battle. As a new investor you have all kinds of fears. It’s hard to get started. You don’t have enough money to start. You don’t know what you’re doing or where you should even open up an account. Here are five lessons learned from a new investor.
No product on Wall Street draws more criticism than leveraged ETFs. Leverage funds are designed to multiply the performance of indexes, but often do so poorly in the long run. The ProShares Ultra S&P500 ETF (SSO) tracks twice the daily return of the S&P500 index every day. If the S&P 500 is up 1%, then […]
So, you worked all summer and now you have some extra cash on hand, maybe $1,000 or more. If so, nice job! Now, do you take that $1,000 and spent it on beer all year? Or do you take that money and invest it? Well, if you spent it on beer, you will drink fine […]
Outcome of a forthcoming event, such as a presidential election or the FED’s announcement, affects the market. But you are not sure in which direction it will move. You simultaneously purchase both a call and a put option with the same underlying asset, strike price and expiration date. You will make a profit depending on […]
If you are a producer or consumer of any commodity, you can buy or sell derivatives to hedge against fluctuations in the movement of underlying commodity prices. You can use options, futures or swap agreements to minimize uncertainties in your business. If you want to learn more check out these resources: A Total Beginner’s Guide […]
The movements of the stock markets are based on the Supply & Demand of shares. The share price of a company with a lower number of outstanding shares will move easily compared to a company with a larger number of outstanding shares. O’Neil’s research shows that more than 95% of companies that have shown huge […]
Stock price decrease accompanied by increases in volume indicates there is higher selling pressure. This shows people are selling their holdings. The price may decrease further. On the other hand if the price declines but with decrease in volume, it indicates there’s no significant selling pressure. The price may not decline further. If you want […]
The stock market is unpredictable. In case of urgency, you may be forced to sell your investments even if the market is low. Hence you should keep a separate emergency fund with banks that you can access whenever required. The banks offer fixed deposits schemes that allow you to withdraw before maturity too. You should […]
Big mutual funds, pension funds, hedge funds and banks have strong buying power. They buy and sell in bulk. Their action influences the market. For example, if a stock is included in a market index such as DJIA and S&P, the Index Funds make purchases of the stock to rebalance their portfolio. This pushes up […]