New answers tagged investing
6
votes
Does eToro's Dividend Growth smart portfolio really pay dividends?
Does eToro's Dividend Growth smart portfolio really pay dividends?
Yes. https://www.etoro.com/customer-service/help/75781345/does-etoro-pay-dividends/:
Does eToro pay dividends? Yes, we do. Your ...
- 10.9k
2
votes
What kinds of investments are available in Canada to offset inflation impact?
A few thoughts:
Income is typically the best way to offset inflation. Depending on your field, your income should increase naturally over time, which will give you more purchasing power.
If income ...
- 124k
1
vote
What kinds of investments are available in Canada to offset inflation impact?
One option you haven't mentioned is to buy durable things, and store them.
Gold or other precious metals are one possibility. Buying gold offers nothing in the way of diversification. But it won't ...
- 9,476
8
votes
How does SIPC insurance help a small investor with a fixed portfolio that is currently down below original value?
https://www.finra.org/investors/need-help/your-rights-under-sipc-protection
SIPC provides limited coverage to investors on their brokerage accounts if their brokerage firm becomes insolvent.
Your ...
- 49.9k
14
votes
How does SIPC insurance help a small investor with a fixed portfolio that is currently down below original value?
SIPC promises that the securities that you held in a failed brokerage, up to the value of $500K (of which up to $250K in cash) are returned to you.
It doesn't insure the value of the securities, it ...
- 149k
1
vote
When is it worth taking out a loan for something I could pay in cash?
Unless your goal is to gamble, you don't take a loan for something you could pay for in cash unless you have other needs for that cash that you won't be able to get a loan, or as good a loan, for. In ...
3
votes
When is it worth taking out a loan for something I could pay in cash?
First, you need to be good with money. If you buy an item for £1,000 but don’t pay yet, you must have the mind to understand the money is gone and you can’t spend it anymore, even though it is still ...
- 21.8k
6
votes
Accepted
When is it worth taking out a loan for something I could pay in cash?
In the UK, if you buy something on credit (over £100, under £30,000 if I remember right) then the credit provider is jointly liable with the supplier for the product. If the supplier goes out of ...
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3
votes
When is it worth taking out a loan for something I could pay in cash?
When you get old (like I am) and have paid off your house and have no other loans, and there's a deal on buying a car (say 1.9% financing for 60 months) or furniture (0% financing for N years), then ...
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1
vote
When is it worth taking out a loan for something I could pay in cash?
If you require cash in the near future or can reliably expect large increases in your income then using a loan is sensible. A loan is also preferred when a fixed interest rate is near or below ...
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9
votes
When is it worth taking out a loan for something I could pay in cash?
Theoretically you can make more on average by investing than borrowing. But there are two HUGE caveats:
In practice, most people are not as good at investing as they think they are. Humans are ...
- 124k
5
votes
When is it worth taking out a loan for something I could pay in cash?
If you can pay for it in cash, the only reason not to do so is because you are getting better return rates on the money where it is than the loan is charging you -- essentially, a leveraged position.
...
- 37k
5
votes
What does "investing in credit" mean?
If you buy a credit-risky bond (corporates, munis, emerging markets... anything but the highest-rated sovereigns like Treasuries or Bunds, really), you're exposed to interest rates, as well as credit ...
- 7,604
0
votes
Is it possible to hold stock certificates directly without any counterparty risk whatsoever?
I'm not sure it is still possible to get physical stock certificates. Which is a pity since they were often lively example of the engraving and printing arts.
In theory, if you are on record as the ...
- 37k
5
votes
What does "investing in credit" mean?
"Long credit" means that you are positively exposed to credit quality. This is commonly measured as the difference in yield between corporate bonds and government bonds. If credit gets ...
- 124k
3
votes
Invest on etf when you are young
Dividends are not "income" or "growth" in the sense that they are just pulling cash from the ETF. The value of the ETF goes does by the amount of the dividend for that reason. ...
- 124k
1
vote
Are assets held under brokerage at risk of a bank's bankruptcy proceedings?
Securities are not covered by FDIC, but they may be covered by SIPC.
SIPC protects, in summary:
SIPC protects against the loss of cash and securities – such as stocks and bonds – held by a customer ...
- 149k
2
votes
Accepted
Why is YTW (Yield-to-Worst) not available for some callable bonds?
FWIW, Fidelity shows a YTW that's identical to the YTM. It also doesn't show a call schedule/dates, other than "extraordinary redemption", so there's no YTW to be calculated.
Looking at the ...
- 7,604
0
votes
Why is YTW (Yield-to-Worst) not available for some callable bonds?
As per your attached screenshot for Bond details, Schwab states that the bond is callable anytime with 30 day notice according to Schwab and displays it as callable. To find the yield to worst of an ...
- 1,556
2
votes
Why is YTW (Yield-to-Worst) not available for some callable bonds?
As usual, my first advice to you is to buy a dictionary. Most, if not all of your questions, stem from just not understanding the terms. Here's the basics on callable bonds.
The bond can be called ...
- 149k
1
vote
Accepted
Invest on etf when you are young
Investing early is great. Compound returns do amazing things when given more years to work with.
I haven't looked at that particular fund, but the keyword I'd hit you with is **diversify"*. At ...
- 37k
0
votes
What are the downsides, if any, of purchasing bonds on the secondary market instead of the primary market?
One downside of purchasing municipal bonds (aka munis) on the secondary market instead of the primary market, as RonJohn mentioned in the comment section: municipal bonds on the secondary market may ...
- 10.9k
1
vote
Is it financially preferable to purchase Treasury bonds on the primary market or on the secondary market?
non-competitive bids typically give sub-optimal yield-to-maturity
Why? You get the same market yield as everyone else, except that you're not an active bidder.
Let's ignore the fact that the ...
- 7,604
3
votes
Why does buying Treasury bonds on the secondary market make it easier to sell Treasury bonds at a later date?
Because you've already established access to the market.
- 149k
0
votes
How should I invest if I have much disposable income and cash on hand?
You are indeed in a very fortunate situation and as @Hilmar pointed out on the right track. I suggest to talk to a professional in your region. Ideally someone who does not take commission for selling ...
- 1,556
-2
votes
Are there any downside in investing in a municipal money fund instead of purchasing municipal bonds assuming the money fund's yield > muni bond yield?
Following the question's assumptions and intentional omissions, i.e. assuming:
The money fund's yield (tax-free) is higher than the muni bond yield (tax-free)
The yield of future municipal bonds ...
- 10.9k
1
vote
Investing in basket of stocks in the style of ETF but without re-balancing
You can take a look at the holdings in an index fund, and replicate it on your own. That of course would incur a lot of transaction fees, so in practice it's not feasible for most investors.
Other ...
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6
votes
How should I invest if I have much disposable income and cash on hand?
You are off to a good start.
Highly recommended reading https://www.amazon.com/Intelligent-Investor-Definitive-Investing-Essentials/dp/0060555661: The guy was Warren Buffet's teacher has been dead for ...
- 7,535
3
votes
How can one compare the yield of a municipal money fund with the yield of a municipal bond?
You can't directly compare fund yields to bond yields because they don't measure the same things.
Fund yield measures the average interest income paid over the last 7 days. In your example it was 3.04%...
- 149k
5
votes
Are there any downside in investing in a municipal money fund instead of purchasing municipal bonds assuming the money fund's yield > muni bond yield?
The 7-day yield of the fund is likely a taxable yield, whereas the 2.81% of the bond you highlighted is probably tax free, giving you a tax-equivalent yield of 3.75% (assuming a 25% tax rate).
Either ...
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