chili555
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7 answers
votes
8k views
What does "building wealth" mean as an investing term?
86 votes

Making money is not the same as building wealth. Consider two examples. Jim is a hard-working person who earns after taxes, $1,000 per week. Jim rents a home. Jim finds a way to spend almost exactly $...

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2 answers
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874 views
Is it still insider trading if no benefit was exchanged or received from the information?
10 votes

I am a flight attendant on a private jet and I hear a bank CEO discussing a merger or a buyout. I proceed to purchase that stock before the announcement. The CEO did not tell me to buy it, I just ...

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3 answers
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1k views
High expense ratio funds - are they worth it?
Accepted answer
10 votes

Over the past five years, QFVOX has returned 13.67%, compared to the index fund SPY that has returned 50.39%. SEVAX has lost 23.96%. AKREX has returned 81.82%. In two of your three examples, you would ...

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5 answers
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2k views
How often do typical investors really lose money?
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7 votes

So how often do investors really lose money? The short answer is, every day. Let's first examine your assumptions: If the price of the share gets lower, the investor can just wait until it gets ...

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1 answers
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195 views
What are "Republic of Cuba 4½s " referred to in The Intelligent Investor?
Accepted answer
6 votes

4 1/2s refers to a 4 1/2% coupon rate. Citation: http://www.ascecuba.org/asce_proceedings/cubas-hard-currency-debt/ In June, 1937, the Republic of Cuba floated a $44.4 million note with a forty-...

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3 answers
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196 views
How do NYSE de-listings unfold?
4 votes

Also, anyone who knew about the de-listing ahead of time would be in a position to make a lot of money The fact is, we all know about the delisting well ahead of the time that it actually takes ...

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2 answers
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3k views
Can you sell your REIT stock at any time?
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4 votes

In an exchange traded REIT, the only requirement to sell your shares is that someone else stands ready to buy your shares. One of the ways you can guage the available buyers and sellers is to check ...

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2 answers
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115 views
Mutual Funds(index fund) and IRA?
4 votes

I see no indication in Vanguard’s description of the fund that requires that you hold it in an ordinary IRA or a Roth. I believe that you could decide to hold it in an ordinary after-tax personal ...

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1 answers
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128 views
Can I realize a taxable capital gain on a mutual fund without selling any shares?
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4 votes

A mutual fund itself generally isn’t taxed on its income or gains. To avoid taxes, each year a mutual fund has to pay out and pass through to its shareholders most of its net interest, dividends, and ...

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11 answers
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11k views
Does the stock market create any sort of value?
4 votes

Let's say that you bought a share of Apple for $10. When (if ever) their stock sold for $10, it was a very small company with a very small net worth; that is, the excess of assets over liabilities. ...

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1 answers
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127 views
Do I need a will if beneficiaries are designated?
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3 votes

IRA Designation of Beneficiary: Most are written assuming that the beneficiaries of the IRA will outlive the owner. Will they? Will they all? Are there contingent beneficiaries designated? Are they ...

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3 answers
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327 views
If my mortgage were to be foreclosed prior to completion of repayment, would I receive any cash value back for the payments I have made?
3 votes

In addition to @quid’s answer, what you will get depends on many factors. As has been pointed out, a bank sale is likely to get a distressed, fire-sale price. A pre-forclosure sale is likely to get ...

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1 answers
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670 views
What happens when I buy Continuously-Callable bonds
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3 votes

The state of Illinois will likely call the bond if interest rates go down and they can sell a bond for, for example, 4 1/2% and use the proceeds to call or retire your bond. This has the benefit of ...

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4 answers
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294 views
For a very stable listed company, does the P/E ratio represent how many years the buyer can stand to earn his/her investment back?
2 votes

Imagine, as in some of the other answers, a company whose stock sells for $90 and whose earnings this year were $10. The resultant P/E is 9. As has been stated, if the company pays out all of the $10 ...

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7 answers
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12k views
Why does Warren Buffett consider real estate as productive asset?
2 votes

You have an idea to manufacture and sell widgets. At first, you and your partner, let's call him Woz, make widgets in the garage at your home. Eventually, the demand for your widgets grows and you ...

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3 answers
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431 views
Does the profit of a company directly affect its stock or indirectly by causing people to buy or sell?
2 votes

people implicity agree to sell stocks when a company does bad But, remember, when you sell the stock of a company that, in your estimation, 'did bad', someone else had to buy; otherwise, there is no ...

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3 answers
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828 views
Purpose/benefits of having a large investment portfolio?
2 votes

The compound annual growth rate of the S&P 500 over the last 20 years is in excess of 7% annually. http://www.moneychimp.com/features/market_cagr.htm Several index funds mirror the S&P 500 ...

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2 answers
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676 views
How to chose index funds, mutual funds from a plethora of options (TD Ameritrade)
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2 votes

I agree with others here that suggest that you should be taking higher risk since it is repaid with higher returns. You have 40 years or so to go before you might switch to safer but lower return ...

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2 answers
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849 views
Opinions on Retirement Planning
2 votes

Good news! It will be enough if you make the most important decision after retirement; that is, the decision to live within your means. With $220,000 per year in 2015 resources, will you live in the ...

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1 answers
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384 views
Difference between Property/Casualty and Personal Auto insurance
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1 votes

If the financial statement for the insurance carrier lists separate line items for Personal Auto and Property and Casualty, then one is not a subset of the other. Typically Property and Casualty ...

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9 answers
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5k views
How Is Insurance Fundamentally Different Than A Ponzi Scheme?
1 votes

In a Ponzi scheme, every investor believes that he will receive an extraordinary annual return and, eventually, on demand, the return of his initial invested capital. He has, in fact, been ...

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3 answers
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314 views
Dalbar: How can the average investor lose money?
1 votes

I think you are mixing two different concepts here. The average investor, in the quoted reference, means an average single investor like you or like me. the average investor consistently under-...

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3 answers
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245 views
Why do stock prices change?
1 votes

In addition to D. Stanley's very fine answer, the price of stocks change as a result of changing market conditions and the resulting investor estimation of its effect on the company's future earnings. ...

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2 answers
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93 views
Pros / cons of being more involved with IRA investments
1 votes

Let’s compare your target fund, FFFFX to a well-known ETF, SPY; SPDR S&P 500 ETF. Trailing Returns (%) FFFFX 1-Year 17.50% 3-Year 7.10% 5-Year 11.28% 10-Year 4.40% SPY 1-Year 17.44% 3-Year ...

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1 answers
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463 views
Does Berkshire Hathaway pay regular long-term gains or special business tax rates?
1 votes

The first article you link clearly refers to Warren Buffet and doesn't, in regard to taxes, refer in any way to Berkshire Hathaway. The second article you link is titled, "Ways Professional Traders ...

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2 answers
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447 views
Roth-IRA withdrawal penalty: 10% of what?
1 votes

Unless an exception applies, most distributions from a Roth IRA before the owner reaches age 59 1/2 will be subject to an "early withdrawal penalty" of 10% on the amount of the distribution. Be very ...

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2 answers
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460 views
How does a company have a net loss in their income statement, but their stock market value still rises?
0 votes

When a new company is started, its assets, aside from the persons with the great ideas, are the capital (money) that the founders contributed to the start-up. Some of the money may be used to purchase ...

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2 answers
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191 views
Is there any disadvantage to calculating my 4th quarter estimated tax so that I have no annual tax payment or refund?
-1 votes

As in many things financial, the answer is, “It depends.” The IRS will penalize the taxpayer if withholdings and tax payments are not at least 90% of the tax for the current year or 100% of the tax ...

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4 answers
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4k views
Equity market inflow meaning
-1 votes

Inflows to the US equity market can come from a variety of sources; for instance: You were paid a year-end bonus and decided to invest it in US equities instead of foreign equities, bonds, savings or ...

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