- Stock and Bond Allocations by Age
Building a portfolio often involves adjusting stock and bond allocations by age to reflect changing financial goals and risk tolerance. While age is only one of several factors that drive asset allocation decisions, investors of a similar age frequently have portfolios that resemble each other in important ways. Younger investors typically hold a higher percentage… read more…
- Historical Annual Yield Comparison: Stock Index vs. Bonds
Historically, stocks have offered higher returns over the long term, but with greater volatility. Meanwhile, bonds have provided steadier, though typically lower, yields. Factors such as interest rates, inflation, economic growth and market sentiment all influence whether stocks or bonds outperform in a given year. Knowing how these variables have played out historically — especially… read more…
- Tracking Stock: What It Is, Pros and Cons, Examples
Tracking stock is a class of shares issued by a parent company to reflect the financial performance of a specific division or subsidiary, rather than the company as a whole. Unlike traditional common stock, which represents ownership in an entire corporation, tracking stocks allow investors to focus on particular business segments within the company. These… read more…
- Equities vs. Stocks: Is There a Difference?
The terms “equities” and “stocks” are often used interchangeably, but they carry slightly different meanings depending on the context. Stocks typically refer to shares of individual companies. Equities is a broader term that includes all types of ownership interest in publicly traded companies. These may also include ownership through mutual funds and exchange-traded funds (ETFs),… read more…
- Small-Cap Stocks vs. Large-Cap Stocks: Differences to Know
When building your investment portfolio, understanding the differences between small-cap stocks and large-cap stocks is essential. Market capitalization, or the total value of a company’s outstanding shares, separates small-cap from large-cap investments. Large-cap companies typically have market values exceeding $10 billion and include household names like Apple and Microsoft. Small-cap stocks, meanwhile refer to companies… read more…
- Stocks vs. Options: Which Should You Invest In?
Stocks and options are two types of investment vehicles that offer unique advantages but come with different levels of complexity and risk. Stocks represent ownership in a company, providing a straightforward way to build wealth through potential appreciation and dividends. Options, on the other hand, give investors the right to buy or sell assets at… read more…
- Class A Stock vs. Class B Stock: Differences and Examples
The distinction between Class A stock and Class B stock lies primarily in voting rights and ownership structure. Companies may issue multiple share classes to raise capital while keeping control. Each class can carry different privileges and influence. In many cases, class A shares carry more voting power than class B shares, but may be… read more…
- Tariffs: How Will They Impact the Average Consumer?
Towards the end of April, the Trump Administration announced a comprehensive set of tariffs. If fully implemented, this tax increase will apply to all products imported into the United States from every country in the world. The Trump Administration intends to set a minimum 10% tariff on all imports. However, the specific rates vary across… read more…
- Bear vs. Bull in the Stock Market: What to Know
The terms “bear” and “bull” in the stock market describe two distinct trends that influence investor sentiment and market movement. A bull market is when stock prices are rising, often driven by optimism and strong economic indicators. In contrast, a bear market signals declining prices and widespread caution among investors. Recognizing the differences between these… read more…
- Bid vs. Ask Prices in Stock Trading: What’s the Difference?
Understanding the difference between bid vs. ask stock prices is essential to making informed investment decisions in the stock market. These two figures represent the foundation of every stock transaction in the market. The bid price is the maximum amount a buyer is willing to pay for a share, while the ask price (sometimes called… read more…
- Paid-In Capital: Definition, Calculation and Where to Find
When companies issue stock to raise money, the funds they receive form part of their financial structure, categorized as paid-in capital. This is the total amount investors have contributed in exchange for equity. Unlike retained earnings, which accumulate from business operations over time, paid-in capital specifically tracks the money that shareholders have invested in the… read more…
- What Is a Quoted Price and What Does It Tell Investors?
A quoted price is the current market value at which a security, commodity or financial instrument can be bought or sold in real time. For investors, this figure acts as a snapshot of supply and demand dynamics, reflecting what buyers are willing to pay (bid price) and what sellers are asking (ask price) at any… read more…
- Should You Invest $100k in Stocks or Real Estate?
Choosing between investing $100,000 in stocks or real estate requires considering your priorities. Stocks provide liquidity, allowing quick access to funds. They also historically average around 10.5% annual returns, though they’re subject to market swings. Real estate offers tangible assets with potential rental income and tax advantages, but requires active management and time to sell.… read more…
- What to Invest $100k in for a Diversified Portfolio
Wondering how to build a diversified portfolio with $100,000? With this amount of capital, you have many options to spread your investments across different asset classes. A balanced approach might include a mix of stocks through index funds or ETFs, bonds for stability, real estate investment trusts (REITs) for property exposure and perhaps alternative investments… read more…
- Is Rental Income Considered Active or Passive?
The IRS typically considers rental income passive income because investment properties don’t require day-to-day management. There are, however, exceptions, and the level of participation can alter this classification. This makes it important to determine whether your rental income falls under active or passive income for tax planning and compliance. If you’re planning to expand your… read more…
- How to Invest $500k for Monthly Income
Investing $500k for monthly income involves choosing a mix of assets that can provide steady cash flow while managing risk, liquidity and taxes. Common strategies include putting portfolio funds into dividend-paying stocks, bond ladders, real estate investment trusts (REITs) and annuities. No single approach is optimal for all income investors. The goal is to balance… read more…
- How to Invest $1 Million for Monthly Income
Learning how to invest $1 million for monthly income starts with understanding the tradeoffs between yield, risk and liquidity. The more you prioritize one feature, the more it may affect the others. Investors can tailor their strategies to reflect their own objectives and preferences. The right approach often depends on your time horizon, tax situation… read more…
- Timing the Bottom: What Have Investors Been Able to Earn Buying TSLA Dips?
Tesla (TSLA) has been one of the most volatile stocks on the market recently. From its December high of around $480, shares have dipped to less than $250 per share at time of writing, at times going as low as $221. In that time TSLA has swung significantly, gaining and losing up to 30% of… read more…
- What Are Inverse/Short Gold ETFs?
Inverse or short gold ETFs are investment vehicles designed to profit when the price of gold declines. Unlike traditional gold ETFs, which track the price of gold and increase in value when gold prices rise, inverse gold ETFs move in the opposite direction. These funds are popular among traders and investors who want to hedge… read more…
- How to Invest in Emerging Market Debt
Emerging market debt offers an opportunity to tap into the growth potential of developing economies. This asset class consists of bonds issued by governments and corporations in countries with emerging financial markets. While they can offer higher yields than traditional U.S. or developed market bonds, they also come with greater risk. A financial advisor can… read more…
- How to Avoid Taxes on CD Interest
Certificates of deposit (CDs) are a popular low-risk savings vehicle. But it’s important to consider that the interest they earn is fully taxable as ordinary income. Even if you don’t withdraw the interest until the CD matures, the IRS still expects you to report and pay taxes on it annually. While avoiding taxes altogether may… read more…
- Net Tangible Assets: How to Calculate, Formula, Examples
Net tangible assets represent a company’s physical assets minus its liabilities and intangible assets. For investors, lenders and business owners, net tangible assets can offer a clearer picture of a company’s core value — namely, what would be left if all debts were paid and only tangible, sellable items remained. This can be helpful when… read more…
- What Is Real Estate Syndication?
Real estate syndication allows investors to combine their money to buy properties that may be out of reach individually. In a typical real estate syndication, a sponsor or syndicator identifies the investment opportunity, handles the acquisition process and manages the property, while passive investors contribute capital in exchange for ownership shares. These arrangements use various… read more…
- Exchange Ratio: Formula and How to Calculate
When two companies undergo a merger or acquisition, shareholders of the acquired company often receive shares of the acquiring company instead of cash. The number of new shares is determined by the exchange ratio, a straightforward formula that compares the price offered per share of the target company to the current share price of the… read more…
- 13 Investing Strategies for High-Net-Worth Individuals
High-net-worth investing strategies are tailored for individuals with liquid assets typically exceeding $1 million. Financial advisors tend to handle these high-net-worth individuals (HNWIs) somewhat differently than other clients. Such investors may pursue opportunities like private equity, hedge funds, direct real estate and tax-advantaged municipal bonds, among others. They may receive more personalized services and may… read more…