- Margin Account vs. Cash Account: Key Differences
Brokerage accounts come in two main types: cash accounts and margin accounts, each catering to different investment strategies and risk appetites. In a cash account, investors are required to pay the full cost of any securities purchased, typically within a settlement period of three business days. Margin accounts, in contrast, allow investors to borrow funds… read more…
- Understanding How Special Dividends Work
Corporations that pay dividends to stockholders usually make the payouts on a regular schedule, such as annually or quarterly. However, they sometimes opt for special dividends. These non-recurring cash dividends are usually much larger than the regular recurring dividends. Companies may use them to reward loyal shareholders when profits are unusually good, to distribute proceeds… read more…
- Coinbase vs. Binance: Which Crypto Platform to Use?
Coinbase and Binance are two of the largest cryptocurrency markets online today. Coinbase is one of the oldest and most well-established markets. It was founded in 2012 and currently trades publicly on the NASDAQ exchange. Binance was founded in 2017… read more…
- Ways to Invest and Use $5 Million
$5 million may sound like a vast sum, but without proper financial planning, it can deplete faster than expected. However, with smart investment strategies, you can make that wealth last for decades—potentially securing your financial future and allowing you to retire comfortably. Regardless of your current age, disciplined investing and prudent money management can help… read more…
- Blockchain Real Estate – Investment Guide
Blockchain is a diverse digital technology used by cryptocurrencies like Bitcoin and Etherum. The adoption of blockchain technology has significantly impacted the financial services industry. Due to the decentralization of the blockchain platform, transactions such as mortgage loans can be made swiftly, seamlessly and with complete transparency. Blockchain real estate applications have also proven to… read more…
- American vs. European Options: Key Differences
Trading options, which are a type of derivative security, may appeal to investors who are comfortable taking on more risk for the potential to earn higher returns. It’s helpful to understand certain options trading terminology before diving in, including the difference between American and European style options. The two share some similarities but they differ… read more…
- Vanguard vs. Fidelity vs. Schwab
It is no secret that Vanguard, Fidelity and Charles Schwab are three of the most popular and well-known brokerage firms. These financial institutions are also some of the largest, offering a wide range of products and services.
- What Are Discount Bonds?
Investors often purchase bonds for recurring income and as a hedge against stock market volatility. Most bonds are initially sold “at par,” which means that they’re sold at face value. After the original sale, the value of bonds fluctuates based on interest rates, the credit rating of the issuer and economic trends that affect interest… read more…
- Stakeholder vs. Shareholder: Key Differences
Many people have a vested interest in the success of a company. If you own a portion of it, you want it to succeed because then you get a cut of the profits. Folk like that are called “shareholders.” If… read more…
- Your Guide to Green Investments
Green investments are investments in companies, government entities or supranational organizations that support environmentally friendly practices. Those practices may include natural habitat preservation, green building, water conservation and production or distribution of renewable energy. Green investing is often associated with socially responsible investing (SRI), though SRI extends to more than just environmental causes. There are… read more…
- The U.S. Government Just Dropped an Inflation Hedge in Investors’ Laps
For much of the past few months, the biggest news in Washington has been the twin bills being considered in Congress — a $1 trillion bipartisan infrastructure bill and a $3.5 trillion budget agreement aimed at social services. While neither of them has been passed yet, there is still good reason to be optimistic both… read more…
- What Are Treasury STRIPS? – Investment Guide
Treasury STRIPS, or Separate Trading of Registered Interest and Principal of Securities, are specialized U.S. government-backed investments designed for long-term financial planning. These securities are created by stripping the interest coupons from Treasury bonds, allowing investors to purchase them at a significant discount and redeem them for full face value upon maturity. Known for their… read more…
- How Do Green Bonds Work?
Green bonds may appeal to investors who want to make a positive impact with their portfolios. These bonds are issued for the purpose of funding projects that support sustainability. The first green bond was issued in 2007 by the European Investment Bank, followed by the World Bank Green Bond in 2008. Since then, the market… read more…
- What Does Risk Return Tradeoff Tell Investors?
Risk return tradeoff is an investing term that describes the relationship between the risk an investor takes and the level of returns he realizes. The two move in tandem: as risk increases, so does the potential for higher returns. Likewise, the less risky an investment is, the lower the returns or rewards are likely to… read more…
- What Is Sector Rotation? An Investment Guide
Sector rotation involves moving investments from one stock sector to another to keep pace with a changing economy. As the economy moves through different cycles, some stock sectors may perform better than others. Rotating investments allows investors to manage risk while potentially boosting returns, based on where the economy is at any given time. This… read more…
- What Is a Shareholder? – An Investment Guide
Companies sell shares of stock to raise capital. Investors and other entities that purchase those shares are called shareholders. A shareholder is also known as a stockholder. Being a stockholder means you have an ownership stake in that company. The… read more…
- What Is Distressed Debt? An Investment Guide
Distressed debt is debt that belongs to companies or government entities that are struggling financially. These entities may be in bankruptcy or in danger of having to file bankruptcy because their financial obligations are too great. Distressed debts can create opportunities for investors who purchase them at a discount. Investors can profit if the company… read more…
- How to Buy Microsoft Stock
Microsoft is one of the highest profile stocks on the market. Although not necessarily the highest performing tech stock out there, as it has fallen behind the FAANGs in that contest, there are few companies that can boast the pedigree that Microsoft has on the market. Here’s what you should assess as you consider buying it. Consider… read more…
- What’s Short Interest and What Does It Tell Investors?
Short interest measures how many shares of a specific stock are the object of investors’ negative outlook. These “short shares” have been borrowed by investors to sell and have not yet been repurchased to close out the position. It can be expressed as either an absolute value (the number of shares) or a percentage relative… read more…
- What Does an Activist Investor Do?
Activist investors have steadily carved out a niche for themselves, establishing investment portfolios built around social and political goals. For example, activist investors made the news recently when hedge fund Engine No. 1, which works on environmental issues, secured multiple seats on the board of Exxon Mobil. Here’s how activist investors work. A financial advisor… read more…
- How to Set Smart Goals for Your Investments
When you set up an investment portfolio, it’s essential to have a strategy. That doesn’t have to mean complexity. You can make plans as simple as “minimize risk” or “save for retirement.” In fact, most investors do exactly that. But you do need a sense of what you want to achieve and how you’ll get… read more…
- Investor’s Guide to Marketable Securities
Most investors build their investment portfolios with a diversified array of stocks, bonds and other assets. These highly liquid investments are known as marketable securities and make up the majority of the assets that investors buy. In this article, we’ll define what marketable securities are, identify the major types of marketable securities and share how… read more…
- What’s Contango and What Does It Tell Investors?
Investors trade in commodities as a way to diversify their portfolios and take advantage of the price fluctuations of goods. Commodities are broadly categorized as one of four types – metal, energy, livestock and meat and agricultural. You can invest in commodities through futures contracts, options and exchange-traded funds (ETFs). When trading in commodity futures,… read more…
- What Is Margin Debt and How Do Investors Use It?
Most investors buy and sell stocks, bonds and other securities using the assets in their brokerage accounts. Sometimes, investors want to be able to withdraw money from their accounts without actually selling any of their investments. Investors can accomplish this by borrowing against their portfolios. This is known as margin debt. There are many reasons… read more…
- How Venture Philanthropy Impacts Investment
Venture philanthropy uses techniques from the world of venture capital financing to support charitable and humanitarian goals. It differs from impact investing in several ways, including being oriented more toward the longer term, more like a partnership, investing in nonprofits instead of for-profits and not as concerned with getting a financial gain or even return… read more…