Questions tagged [investing]
Investing is the process of buying assets such as securities, real estate and other items of value that will hopefully increase in value over time, providing a return in the form of income payments or capital gains.
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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 ...
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If a stock doesn't pay dividends, then why is the stock worth anything?
I read somewhere that companies are not required to pay dividends to shareholders (this is correct, yes?).
If so, then if company A never pays dividends to its shareholders, then what is the point ...
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Why would a company care about the price of its own shares in the stock market?
After a company has issued shares, why should it care if the value of the shares fluctuate?
Since the shares are now publicly traded, if the value fluctuates, that is strictly a transaction between ...
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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 the following:
Bid: 13.20 x200 Ask: 13.27 x1,000
the current stock price is 13.22.
Can someone explain what ...
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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 ...
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In general, is it financially better to buy or to rent a house?
I know this differs from country to country, from person to person (depending on how much you already have saved), but I'm curious about the simplest example.
Let's say I have little to no money.
I ...
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What is the best asset allocation for a retirement portfolio, and why?
Based on financial conversations I've had with trusted family members, I believe that asset allocation is one of the more critical things to "get right" during retirement savings.
Based on an ...
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Why are daily rebalanced inverse/leveraged ETFs bad for long term investing?
I was reading this article about S&P 500 short ETFs:
https://www.zacks.com/stock/news/176217/4-ways-to-short-the-sampp-500-with-etfs
and I was confused when it said: "investors should note that ...
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Investing in a leveraged index ETF for retirement. Risky?
Let's say someone has 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 11% per year in total returns.
...
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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 ...
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What are the important differences between mutual funds and Exchange Traded Funds (ETFs)?
I've been considering, but haven't committed myself yet to investing in Exchange Traded Funds (ETFs), but have to admit that I don't yet fully understand the use-case for them.
What factors are ...
23
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Book or web site resources for an absolute beginner to learn about stocks and investing? [closed]
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 ...
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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 ...
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Why isn't everybody rich?
This question came up after reading this question (stock market long term risks), in which it is re-iterated (as it has been many times on this site), that investing in the stock market, especially an ...
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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 debt(...
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Can you really always yield profit if you diversify and wait long enough?
It is a common assumption (and, as far as historical stock market data goes, also proven) that the stock market is always growing if you enlarge the time window long enough . In other words: The stock ...
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Does a stock really dip in price on the ex-dividend date? And why would it do this?
As per this Investopedia article:
Because the stock price is expected to drop by the amount of the
dividend on the ex-dividend date,
Why is a stock expected to fall on the dividend date? Does it ...
5
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1
answer
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Pay off mortgage or invest in high value saving account
I have a mortgage of 30 yrs amortization and have 290k left on the mortgage. It suddenly hit me that with my bi weekly payment of 620, it would take forever to pay it off.
I need some help deciding if ...
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Do I make money in the stock market from other people losing money?
Basically I am new to stock trading and neglect to see the differences between trading stocks and betting on sports. Basically I am "betting" on which company will do well, and this can ...
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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 ...
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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 ...
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Ethics and investment
I am a young man who has recently reached a point of financial stability. I'm starting to think about long-term plans which may one day buy a home, or provide for myself in old age.
This raises the ...
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Do stock prices drop due to dividends?
From Personal Finance for Dummies, page 209:
Dividends
Dividends are income paid by investments. Both bond funds
and stocks can pay dividends. Bond fund dividends (the interest paid
by the ...
23
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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?
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Effectiveness of technical analysis techniques: Any supporting studies? [closed]
Do you find Techical Analysis to be an effective way of increasing the returns on your investments? This can be either by itself, or in combination with other indicators. If so, what techniques do ...
5
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9
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How do you take profit from stock trading while keeping capital invested?
Suppose you buy stocks from company FOOBAR at price X. After a while, the price is Y = X * 1.25, so you decide you want to collect that 25% profit. You sell the stocks, cashing out your original X ...
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Why do investors pay trillions for minority stakes in companies, when their only potential payback is modest uncertain dividends? [duplicate]
I'm struggling to understand the core reason to invest in stocks as a minority shareholder. Majority shareholding makes more sense as you effectively control the company, so you can pay yourself ...
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How do I get into investing in stocks?
How do I get into investing in stocks?
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What is a large sudden jump (or dip) and instantaneous recovery in a stock price [duplicate]
So why did the price tank all of a sudden and then came back to normal? What does it mean?
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"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 ...
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What happens to your investment if the broker (which acts as a custodian) goes bankrupt?
For instance, you purchased ETFs using a broker that also acts as a custodian, what will happen to your investment in case the broker / custodian goes bankrupt? Will you lose all your investments?
(...
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1
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Investment options for f1 visa students in USA
I am foreign graduate student in USA. I recently completed my undergrad (from USA) and have a bit of money saved up. I know that F1 students cannot work off campus and other business activities such ...
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Stock market long term risks
This question has been spurred by the following question which was on the 'Hot Network Questions' Is it a lie that you can easily make money passively in the stock market? . The answers to that ...
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I'm saving money too fast. What should I do?
[Apologies if this sounds (and is) like a first world problem]
I get a very generous salary and I am not a spender. I am able to save $2000-$2500 every month.
I've invested part of my money in some ...
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Should a high-school student invest their (relative meager) savings?
I am a high school student, I don't really have much money, between one and two grand in my savings account. However, I have friends who are investing in both penny stocks and stocks. I do not really ...
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How can I determine if my stock picking performance was due to luck or due to skill?
From 2000 to 2020, the S&P 500's compounded annual growth rate (CAGR) is about 6-7% (assuming dividend reinvestment). With a CAGR of 6.5%, every $1 invested in 2000 grows to about $3.50 by 2020.
...
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Is it true that 90% of investors lose their money?
Many investment gurus state that majority of investors fail and then offer a proven "[insert fancy name] investment strategy" that will make you successful. The number usually starts at 90% and often ...
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Why would anyone buy a government bond?
In my country, the interest rates on government bonds are currently 2 - 3%, but I have money in a term deposit at the bank which earns 4% interest. I don't understand how this can be possible. Why are ...
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Is there any benefit to investing in an index fund?
Does an index fund comprise of stocks that mimic the index? So when the index is altered to include new players/exclude old ones, the fund also adjusts? But how can this be, since index funds are not ...
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Any Experience with the Gone Fishin' Portfolio?
In doing research on How to Select IRA Investments, I stumbled across the Gone Fishin' Portfolio. This link where I found out about the portfolio claims that it is based on the 1990 economics Nobel ...
12
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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: $...
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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 ...
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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 ...
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How does the purchase of shares on the secondary market benefit the issuing company?
Purchasing common stock is often described as making an investment in the company. In exchange for this investment, you receive shares of the company's profits and, hopefully, you see some capital ...
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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?
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How to automatically reinvest in non-dividend paying funds
I've read Einsteins quote stating "The most powerful force in the universe is compound interest." However, everywhere I read this is basically only possible with dividend paying stocks and then ...
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How to rebalance a portfolio without moving money into losing investments
I've read a number of conflicting opinions on whether portfolio rebalancing is a good idea. The question of whether rebalancing is a good idea has been addressed in some questions here, too, such as ...
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What do the components of the taxable income in the Schedule D Tax Worksheet mean?
The Schedule D tax worksheet calculates the tax on the taxable income by
first decomposing the taxable income in line 1 into lines 19, 20, 28, 31, 37 and 40,
then taxing on them at different tax ...
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Does dollar cost averaging apply when moving investments between fund families?
We'll likely be moving ~$100,000 (two Roth IRAs, about 80k/20k split) from a mix of Nationwide funds to a combination of Vanguard whole-market stock and bond index funds (details below). All else ...
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Are there any non-decreasing securities on the stock market?
Are there any securities traded on the stock market (i.e. ETPs) that never decrease in value?
As an aside (in case anyone mentions bonds):
I'm aware there's ETFs for AAA-rated government bonds, but ...