Investing is growing money over a longer time frame. When appropriate a specific tag like stocks, mutual funds etc should additionally be used.

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114
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11answers
17k views

Best way to start investing, for a young person just starting their career?

I am young, just started my career, and looking to begin investing so I can make my money work for me. I'm still living like I did in college (occasional purchase on myself, but most of it goes into ...
23
votes
3answers
39k views

Can someone explain a stock's “bid” vs. “ask” price relative to “current” price?

In my online brokerage account, I want to buy a particular stock and I see : Bid: 13.20 x200 Ask: 13.27 x1,000 the current stock price is : 13.22 Can someone explain what the bid and ask ...
25
votes
3answers
1k views

Recent graduate with new job: Choose Roth 401(k), or traditional 401(k)?

I just graduated, and I'm starting a new job soon. My employer has pretty good policy for matching 401(k) contributions, so I want to invest as much as possible, especially during this first year. My ...
18
votes
5answers
2k views

Strategies for putting away money for a child's future (college, etc.)?

So my wife and I will be having our first child at the end of the year, and I'm trying to devise a strategy for things like putting money away for the little person now, while I have the time and ...
11
votes
4answers
1k views

Book or web site resources for an absolute beginner to learn about stocks and investing?

I'm completely new to the world of investing and stocks. Knowing that I shouldn't invest or buy stocks until I know it well enough, I was wondering which cheap or affordable resources would be the ...
15
votes
6answers
1k views

How do I get into investing in stocks?

How do I get into investing in stocks?
61
votes
10answers
6k views

Why does gold have value?

I'm curious about why is there so much financial interest and news coverage about gold. It's hard to do things like buy food or pay the rent with gold, but I can do this with cash. Gold doesn't yield ...
8
votes
2answers
183 views

How do I account for newly added money when computing my rate of return?

I have a simple spreadsheet where I track the balance in my investment account. What should I do to handle new deposits in the account? For example: End of Day 1: balance = $100 End of Day 2: ...
65
votes
11answers
8k views

Why would a company care about the price of its own shares in the stock market?

After a company has issues shares, why should it care if the value of the shares go up and down? Since the shares are now being traded among the public, if the value goes up or down, that is strictly ...
12
votes
6answers
477 views

Does dollar cost averaging really work?

Does dollar cost averaging really work? If I have money available now, why shouldn't I invest it all at once? If the market's going up, wouldn't that be better?
7
votes
2answers
660 views

Legal documents required for managing an investment portfolio among friends?

I am considering setting up a personal kind of hedge fund / stock portfolio among friends. I am trying to figure out what kind of a legal agreement I should have them sign for investing with me to ...
13
votes
5answers
953 views

How to evaluate stocks? e.g. Whether some stock is cheap or expensive?

What kind of information do you obtain before buying (or selling) a stock? I know the PE ratio is very important, but not the only thing. Are there any rules of thumb to determine whether some stock ...
22
votes
7answers
787 views

Shares; are they really only for the rich/investors?

I've always been under the impression, that if you want to be a player in the "shares game" you either have to be an full time investor, or someone who has a lot of money to play with. Is this true? ...
22
votes
3answers
23k views

Is the “Bank on Yourself” a legitimate investment strategy, or a scam?

There seem to be a lot of advertisements by "Bank on Yourself", promising to show how you can invest in a certain type of life insurance policy. Is this really a legitimate investment strategy, or ...
7
votes
2answers
667 views

How can I purchase Skype stock during the IPO?

Skype will be going IPO soon. How can I purchase their IPO stock?
15
votes
1answer
212 views

Is there a benefit to creating a donor advised fund to make charitable donations instead of simply donating to organizations each month?

I'm looking to set up recurring charitable donations to various groups, and I'm considering using a donor-advised fund through Fidelity or Vanguard. General question: Is there a benefit to placing ...
4
votes
2answers
770 views

Pros & cons of buying gold directly vs. investing in a gold ETF like GLD, IAU, SGOL?

Google search brings up some articles on this topic, but they can be biased, so: What are the advantages and disadvantages of buying physical gold vs. investing in a gold ETF like GLD, IAU, or SGOL? ...
3
votes
1answer
440 views

Are Investment Research websites worth their premiums?

There are websites that claim to own formulas that outperform the market. Examples of these websites are - Zacks Investment Research or Investors Business Daily. Each keep a list of equities that they ...
0
votes
3answers
169 views

Can a wealthy investor invest in or make a deal with a company before it goes public / IPO?

Can a wealthy investor invest his money in any company before it goes public / IPO? I am referring to a recent Goldman Sachs and Facebook deal worth $450 Million at a valuation of $50 Billion dollars. ...
37
votes
8answers
4k views

Why does a company pay dividends at all?

If a company can lower the dividends and even stop paying them at all during hard times, why would they re-install them at all? If I understand correctly a company pays dividends so that investors ...
19
votes
2answers
1k views

What to do with sudden wealth?

I am about to receive a considerable(for me, anyway) amount of money- about $100k- and really have no idea what to do with it to make it grow even larger. Of course I want to pay off credit card ...
13
votes
2answers
1k views

How would bonds fare if interest rates rose?

The first thing I learned about bonds is that when interest rates rise, the price of existing bonds tends to fall. Unfortunately, I didn't learn much else about bonds. So I have a couple questions ...
16
votes
5answers
1k views

How can life insurance possibly work as investment?

Every here and there I hear about the following investment option: There's an insurance company that is willing to take my money and hold it for some very long time (like 5 years or more) and then ...
11
votes
4answers
5k views

When is Cash Value Life Insurance a good or bad idea?

What makes CVLI either good or bad? If you get it while young (~23 years old) and have a respectable starting salary then what are some benefits or detriments to having it? The specific policy I'm ...
5
votes
4answers
357 views

When is a good time to invest in gold? In what situations is the price of gold likely to drop?

When is a good time to invest in gold? What are situations likely to trigger a drop in gold prices? What are alternatives to gold?
13
votes
5answers
956 views

Why should I invest my money in a life insurance policy?

As i am 24 now i get lot of calls from lot of insurance companies asking to take up an insurance policy.... So i decided to get answers for some of my questions in basicallymoney... Why should i ...
9
votes
2answers
303 views

How does compounding of annual interest work?

I have tried reading up on it, but I just find it confusing. Apparently, if you started investing $150/month at a 15% annual return and kept reinvesting the profits, here is what you would have ...
23
votes
3answers
445 views

What are “preferred” stocks? How are they different from normal (common) stocks?

What are "preferred" stocks? How are they different from normal (common) stocks that you can buy on a stock exchange?
15
votes
3answers
298 views

Are peer-to-peer loans viable options for savings/investing?

Now that peer-to-peer sites like Lending Club and Prosper have matured are they viable options to add to my savings/investment portfolio or should I only use them with extra cash?
12
votes
8answers
1k views

At what interest rate should debt be used as a tool?

I know people love to preach the merits of being 100% debt-free, but when used intelligently, debt can be a powerful tool. All else equal, if I have debt at an interest rate of say 1% and have an ...
9
votes
7answers
3k views

A University student wondering if investing in stocks is a good idea?

I'm a University student (with a University student budget) and I was wondering if it is worth my trouble and my money to invest in the stock system? I don't know much about it, but it seems like a ...
8
votes
4answers
137 views

Other than being able to borrow to invest, how is a margin trading account different from a cash account?

Other than being able to borrow against one's portfolio value to purchase additional investments, how is a typical brokerage margin trading account different from a typical cash trading account? ...
8
votes
5answers
1k views

Buying gold / silver as a hedge against hyperinflation

I'm becoming more interested in buying gold / silver coins as a hedge against inflation and especially hyperinflation. I know very little about this, and there are thousands of sites on the internet ...
5
votes
5answers
501 views

For the first time in my life, I'm going to be making real money…what should I do with it?

So I'm a college junior taking on my first actual paying internship this summer. I'll be making between $3000-$5000 a month. I know NOTHING about investing money, or what I should do with money ...
10
votes
3answers
2k views

How do I make a small investment in the stock market? What is the minimum investment required?

I am not rich, so I am talking one to two hundred U.S. dollars per month only. I would like to know whether I can buy stock using that little amount of money, and how to do that if possible? As an ...
10
votes
3answers
312 views

Investing in a leveraged index ETF for retirement. Risky?

I'm 23, and in addition to my 401k at work, I have a few thousand saved in an IRA. Right now I have it sitting in Treasurys earning around 3%. Over the past 50 years the S&P has averaged around ...
8
votes
4answers
275 views

What is the best way to invest in gold as a hedge against inflation without having to hold physical gold?

What is the best way to invest in gold as a hedge against inflation without having to hold physical gold? Is it possible for a regular person to just purchase shares in GLD?
6
votes
1answer
114 views

Where to categorize crypto-currencies

In Germany, crypto-currencies like Bitcoin are all over the news lately, making me aware of the fact I don't know much about them. A journalistic TV program I was watching yesterday even claimed ...
6
votes
3answers
431 views

How does the yield on my investments stack up against other investors?

I started investing a couple years ago when I started working full time. My investments are doing well. I would ideally like to know how well. Of course, I can go see what my performance was in terms ...
5
votes
1answer
235 views

How to determine desired/required value with “value averaging”?

As opposed to dollar cost averaging (DCA), value averaging (as described in this eHow article) is a technique where the investor determines the value the investment should have after a given time ...
11
votes
1answer
192 views

WSJ article about CFDs - am I missing something?

In this WSJ article, it comments Traders held a net $22.6 billion in bets that the dollar will appreciate, a gain of 31% in net wagers over the previous week and the largest such position since ...
9
votes
4answers
774 views

Over how much time should I dollar-cost-average my bonus from cash into mutual funds?

I just cleared about $65k from my bonus. I don't want this sitting in cash, but at the same time prefer to move into stocks/bonds over time (e.g. I don't want to invest all $65k at one price, and ...
4
votes
1answer
603 views

How to quantify differences in return with low expense ratio vs high expense ratio mutual funds?

One often repeated piece of financial advice is to work to minimize your expense ratios in your mutual funds in order to maximize your returns. While it is often straightforward to determine the ...
3
votes
1answer
318 views

“Cap gains exposure” of an ETF — what does it mean?

Morningstar provides an ETF data point called potential cap gains exposure. For example, here is Vanguard's Europe ETF (VGK): This value is negative 78% for VGK. I understand that this is a good ...
3
votes
2answers
251 views

How to analyze risk of a bond?

If given the screen below as an example, how would you analyze the risk of a bond? I am not sure what to look for to know if this is a good investment. What risk factors should be considered when ...
0
votes
4answers
410 views

Using Loan to Invest - Paying Monthly Installments with Monthly Income

I'd like to ask about a different payment method to this question. I use THEAO's first-rate answer there. How much profit or rate of return is required from a financial instrument, say stocks, to ...
16
votes
5answers
803 views

Where should my money go next: savings, investments, retirement, or my mortgage?

I am a little unsure where to put my money at this point in my life. I have followed all the basic advice on what to do with your money and now I am at a point where I just don't know what to do ...
15
votes
5answers
4k views

What is a good asset allocation for a 25 year old?

I have a mid-sized portfolio (under $100K). And am currently in 100% stocks. I have seen some advice being given that states 80/20 bonds will yield similar returns as 100% stocks with less volatility. ...
17
votes
7answers
736 views

Why is the dominant investing advice for individuals to use mutual funds, exchanged traded funds (ETFs), etc

The dominant advice on this site (including that which I give to novices) regarding investing is to only invest in fund vehicles (mutual funds, ETFs, etc), rather than in individual stocks. Why is ...
14
votes
7answers
2k views

Is it wise to invest money in the stock market?

My uncle wants me to invest money in buying shares. I would like to ask these questions to my fellow users: Is it wise to invest money in the stock market? Is there any age limit to start into stock ...