for questions related to understanding basic concepts in finance or certain terms in a particular context

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0
votes
1answer
22 views

company market capitalization to total (annual) stock market capitalization

I have a panel dataset with 13 countries and 10 years (1999-2009). I'm trying to calculate share/pctage of the average firm market capitalization to average stock market capitalization for each ...
0
votes
1answer
117 views

How to calculate depreciation?

I am not accountant and my question could be trivial but I will ask it. Let's say that I bought a car that cost $50,000. The maintenance cost over 5 years is $25,000. The revenue of the car over 5 ...
1
vote
1answer
52 views

Why is the number of issued shares less than the number of outstanding shares

We know that #issued shares = #outstanding shares + #treasury shares. So the number of issued shares must be greater than treasury shares by definition. However, Starbucks' fiscal 2014 From 10-K ...
15
votes
2answers
5k views

Buying shares in a company after you quit

US law dictates that you cannot buy / sell shares in a company you work for except during open trading windows. I understand lockout periods when you're in a company but what about after you quit? ...
4
votes
1answer
42 views

what does “private equity structures” mean?

I'm translating an article about finance. What does "private equity structures" mean in this context - He said that popular ways for UHNWs to invest in real estate included property club deals ...
2
votes
2answers
88 views

When is an IPO considered failure? [closed]

I am reading case of Air Berlin IPO. It has detail that investors where unhappy as the operating profit was less and company's strategy was not aligned to increase profit. But why did knowing ...
5
votes
1answer
62 views

Can a non dividend-paying product (say ETF) suddenly start paying dividends?

If I buy shares of a product that currently does not pay dividends, can it theoretically/technically start paying dividends in the future?
-1
votes
1answer
48 views

Ongoing Automatic Investment Fee

When a DRIP plan says "Ongoing Automatic Investment Fee", is that the amount of money they take every month? In the case of Hershey's DRIP, it says it's $2. Does that mean if someone invests $50 a ...
3
votes
2answers
65 views

Does a mutual fund's return include fees?

If a mutual fund's published YTD return is 3%, and it has an up-front sales charge of 5% and a 12b1 fee of 2%, are these fees included in the YTD return, or would the "real" return be 3%-5%-2% = -4%?
3
votes
4answers
312 views

Basic questions about investing in stocks

I've had some questions regarding stocks that have been bothering me for a while. They are naive, but that is the whole point: to understand what they are and fix my misconceptions. What is a stock? ...
1
vote
1answer
65 views

How to calculate mutual fund return

How do you calculate the annual return of a mutual fund? I understand roughly how mutual funds work, and I'm trying to decide which mutual funds to invest in, but to prove to myself that I understand ...
1
vote
3answers
123 views

Why should a company go public?

For someone who holds stock in a privately held startup (through exercised employee options) is it preferable to see the company aiming to go public so that stock can be sold on the open market? It ...
0
votes
2answers
76 views

Long term drip (dividend reinvestment plan) stock

I sold a Home Depot stock that I will take in cash and deposit into TD amertrade. Is their tax on this? I want to reinvest in mutual funds. We purchased HD over a 15 yr time period in California. I ...
0
votes
1answer
33 views

Understanding bid and offer prices in CFD's

I am currently researching the mechanics of CFD trading and, being new to this, am a bit confused about certain terms. I understand that the "bid" is the price that the CFD is sold at and the "offer" ...
6
votes
1answer
73 views

Do ETF owners buy and liquidate units from the market when gap between market value and value of underlying shares is large?

Due to various reasons, an ETF, even an index ETF might trade at a value lower that the value of its underlying securities. In such a situation, can the company managing the ETF actually buy from the ...
2
votes
2answers
91 views

Compounded Interest on Mutual Funds

I may be missing or misunderstanding something regarding how compound interest works with mutual funds and ETFs. Let's say I have $10,000, and I invest said monies in mutual fund XXXXX at $100/share, ...
2
votes
1answer
42 views

Currency forward rates

I'm looking at EUR/USD forward rates here: http://www.investing.com/currencies/eur-usd-forward-rates Can someone explain, in very simple terms, what do the bid/ask prices mean? And what is the ...
38
votes
3answers
7k views

How did this day trader lose so much?

I recently read this article about a day trader that lost $100,000: A trader started a GoFundMe page to pay back $100,000 to E-Trade after a disastrous short Please explain this, because I can not ...
0
votes
1answer
45 views

Why would a stock price raise above an initial tender offer price?

Company X received a tender offer buyout price of $8.50/share. Fast forward 10 days later and the share price has exceeded the $8.50 offered. Is this common and what is happening? It was in the offer ...
2
votes
6answers
128 views

Name of investment where capital guaranteed?

I remember briefly hearing about an investment type which guarantees your initial investment. So you are able to make a reasonable (but not mind-blowing) profit but the initial capital that you pay is ...
5
votes
2answers
132 views

Which bank is my Discover card through?

I have used Visa exclusively for 15, now I have my first Discover card. A notable difference is that Visa always carries the name of the bank (for me it was Chase); but the Discover card does not. ...
0
votes
3answers
65 views

Emulating a 'long straddle' without buying or selling Options?

If I go long and short a stock simultaneously, with a 1:50 leverage, and place a stop loss on both for when a 10% loss is reached, isn't this the exact same principle as the long straddle strategy ...
6
votes
1answer
125 views

Can Mutual Funds Invest In the Start Up Market?

This question refers to this article. I can't find Snapchat anywhere on the US stock exchanges as a public company, so I'm assuming that the Fidelity Blue Chip was holding this through the start up ...
4
votes
3answers
619 views

What are some examples of unsecured loans

I am writing an essay on unsecured loans and am now trying to find some examples, so that I may then talk about the pros and cons for each example. I have already mentioned credit cards and an ...
5
votes
4answers
548 views

Why is gold not a good investment? [closed]

The following comment has 18 up votes: Gold is really not a good investment. – Almo (source) What's the deal with it? Is investing in gold bars equally bad as investing in gold jewellery?
1
vote
1answer
85 views

Stock dividends effect on dividend received by shareholder

In CFA level 1 Reading 38, it says Stock dividends are a non-cash form of dividends. With a stock dividend (also known as a bonus issue of shares), the company distributes additional shares ...
3
votes
1answer
395 views

What do the suffixes on stock symbols indicate

For example, this article mentions symbols VZ.N, CVC.N, TWC.N, and CCOI.O. Are these related to share classes and/or warrants? Each of these symbols also seem to exist and can be referenced without ...
1
vote
2answers
176 views

Increasing PE ratio good or bad?

Some stocks like sbux, and nke have continuously increasing PE ratio. Is this a sign of company doing well or a bad sign that company is slowly getting overvalued ?
2
votes
2answers
34 views

Online demat account for stock market

I am planning to open a stock market online account in India. My question is do I need to pay any extra charges on the days when I dont play stock market.
4
votes
4answers
279 views

What is good growth?

I want to start rolling rental income into the stock market more. I already max my company 401k so I don't mind something that isn't tax deferred. Up to this point I have been saving $5k and then ...
4
votes
3answers
109 views

Is technical analysis based on some underlying factors in the market or do they work simply because other people use them?

The market is undoubtedly driven by people, and technical analysis is one way to analyze and predict this behavior. My question (also the title) is "Is technical analysis based on some underlying ...
1
vote
1answer
39 views

Calculating long intervals of Interest with Simple Interest Formula

My last post Calculating long intervals of Interest calculates interest using compounding formula. But what about calculating simple interest accrued where the day count is actual/actual and it goes ...
2
votes
2answers
62 views

Calculating long intervals of Interest

Small interval calculations is fairly straight forward. But what about long intervals. If a loan's daycount is set to Actual/Actual and the duration has run into two different DayCount intervals, how ...
4
votes
3answers
244 views

Do mutual fund companies deliberately “censor” their portfolios/funds?

In Survivorship Bias, David McRaney writes: In finance, this is a common pitfall. The economist Mark Klinedinst explained to me that mutual funds, companies that offer stock portfolios, ...
1
vote
1answer
57 views

Which are assets? Which are liabilities? [closed]

Way to financial independence is buying instead of assets, right? Can anyone give list of popular assets? How to differentiate asset and liability? What are the best asset classes That I should buy? ...
-1
votes
3answers
102 views

How to execute a large stock purchase, relative to the order book?

I am looking to buy my first stock, it is TLN, and I want to buy about 3300 stocks. Looking at the order book on yahoo, it looks like this: Bid Price Size 10.46 200 10.45 100 10.44 100 ...
2
votes
1answer
67 views

Definition of basis and cobasis in a chart

In this article https://monetary-metals.com/silver-price-spikes-but-what-demand-4-oct-2015/, there is a chart of basis and cobasis. For basis I found too many different meanings and for cobasis ...
95
votes
24answers
16k views

Why buy insurance?

I don't understand why people buy insurances when they know that odds are is not their favor. Is it not better bet to stay uninsured, and save money? I am not talking about house insurance. About ...
2
votes
1answer
108 views

Will getting a second credit card from Citibank lower my average account age on my credit report?

I just got a new credit card from Citibank (double cash back card). Whenever the Citibank Visa for Costco is available, I would like to get that too. When I get the Costco card will this lower my ...
2
votes
1answer
63 views

Can a bank make you convert your HELOC into a loan? [closed]

Can a bank make you convert your Home equity line of credit (HELOC) to a loan?
6
votes
4answers
129 views

How do dividend reinvestment purchases work?

Typically if I buy a stock I buy the stock from some guy selling the stock. If I own AAPL I receive a ~2% annual dividend payout which I choose to reinvest automatically. Who am I buying these ...
12
votes
5answers
2k views

Why don't SPY, SPX, and the e-mini s&p 500 track perfectly with each other?

These tickers (SPY, SPX, /ES) are all based off the S&P 500 yet the relative lows and highs diverge. Can someone provide a basic explanation what causes this to happen? I feel like it may stem ...
6
votes
2answers
225 views

How can I tell what is “real” Motley Fool advice?

I clicked on a link and was taken to a video, which troubled me a bit and is a bit different from what I expect of the Motley Fool, of which people have presented as offering advice like "Live below ...
3
votes
2answers
104 views

How does inflation rate affect debt payoff strategy?

When reading a comment by user Philipp on this answer, he states: [W]hen the debt is in a currency which has an average inflation rate larger than the interest [in this case 0%], you essentially ...
5
votes
4answers
184 views

Does bull/bear market actually make a difference?

This may be an extremely naive question, but it is often discussed on the news, here and in person (at least in financial circles) that it is easy to make money in a bull market, and harder to make ...
1
vote
0answers
187 views

What is an undervalued or overvalued bond?

Here's a small excerpt from Bond Valuation section on Investopedia: Determining Whether a Bond Is Under or Over Valued What you need to be able to do is value a bond like we have done before using ...
1
vote
2answers
82 views

Dividend yeild per unit

I have been reading the intelligent investor, on chapter 4 page 91 Graham goes on to say.. While our proposed 50–50 division is undoubtedly the simplest “all-purpose program” devisable, it may ...
3
votes
3answers
166 views

Stocks: do Good Till Cancelled orders get executed during after hours?

If I place a stop loss GTC order on my shares at $80, and it reaches that price during pre-market or after hours, will my order get executed? I ask because a lot of the time the stock opens at a ...
10
votes
3answers
167 views

What exactly is the interest rate that the Fed is going to adjust?

Lately, the financial press talks non-stop about the Fed doing this and that to the interest rate. What exactly is this interest rate that the financial press is talking about? Why is this Fed ...
9
votes
3answers
2k views

Should I care about expense ratios?

I've never been an investor before, but I recently came into some money. In my understanding, expense ratios for mutual funds and ETFs are typically incorporated into the yield or ticker price. If ...