- Investor’s Guide to Cyclical Stocks
One of the most common categories of investment securities is known as cyclical stocks. These are shares in companies that are sensitive to economic or business cycles. When an economy is contracting there prices are particularly vulnerable to a downturn; when an economy is expanding their prices are more likely than other categories of stocks… read more…
- Understanding Reversion to the Mean
Do prices eventually return to normal? Will housing prices decline to more sustainable levels, and can blockchain tokens find long-term stability? Do stock prices always recover after a crash, or is the idea of a financial reset just a myth? These questions touch on the concept of reversion to the mean, a fundamental principle in… read more…
- Hedge Fund vs. Index Fund: Key Differences
Index funds minimize risk by tracking a market metric, like the S&P 500 or a specific industry as a whole. Hedge funds maximize profits by taking high-risk positions and making investments that mitigate those risks. Below we’ll review what you need to know about these radically different investment vehicles. You can also consider working with… read more…
- How Does a Strangle Option Work?
The strangle is an options strategy that you create out of multiple options contracts to maximize your upside while minimizing your risk. With the strangle, you generally believe you know which direction the underlying asset will move. Your position emphasizes this expected movement, but at the same time you open a second option contract to hedge your… read more…
- How Does a Straddle Option Work?
The straddle is an options trading strategy, so named for the shape it makes on a pricing chart; your position literally “straddles” the price of the underlying asset. With the straddle, you trade on the expectation of volatility. This position profits if prices change in a big way, and it tends to lose money if prices… read more…
- Dividend vs. Growth Stocks: Key Differences
Investors use various strategies to select stocks, focusing on industries, price trends, or key metrics. A common approach is choosing between dividend and growth stocks. Dividend stocks generate income through regular payouts, while growth stocks offer returns through price appreciation and capital gains. Here’s how each works. Reading articles like this can equip you to… read more…
- Investing in Options vs. Stocks: Which Is Best for You?
Trading stocks and buying options are two types of investments, though the former is more common than the latter. Each one has strengths, and each one carries potential downsides. The differences don’t preclude investors taking advantage of what each one has to offer. Here’s what you need to know about these two financial moves. Consider… read more…
- Direct Indexing: What It Is and How It Works
Many investors use mutual funds and exchange-traded funds (ETFs) to diversify their portfolios, even when their balances are small. But there’s an alternative that offers several potential advantages to mutual fund and ETF investing. Known as direct indexing, it’s a technique that’s been available for decades, but costs and technological hurdles made it appealing primarily… read more…
- SPAC vs. IPO: Key Differences
In the last few years, something called a special purpose acquisition company (SPAC), has become a popular way to raise capital. A SPAC, also known as a blank check company, bears some resemblance to an initial public offering (IPO), which is a more well-known means of raising capital. But there are key differences. In both… read more…
- Forex vs. Stocks: Key Differences
The foreign currency market (forex) has a lot in common with the stock market. Both are speculative ways of investing, meaning that they offer higher risks and higher rewards than many other assets. Both markets move faster than many other investments, and like most investments, both have grown with the rise of online investment platforms. Forex… read more…
- Stocks vs. Shares: Definitions and Distinctions
Investors tend to use the terms “stock” and “share” interchangeably, and usually that’s fine. A stock comes in shares and you buy a share of stock. But these ideas aren’t always interchangeable. Technically speaking, a stock always refers to equity in a traded company. Shares can refer to stocks, as well as to portions of ownership… read more…
- What Are Micro Futures and How Are They Traded?
Micro futures offer a way for investors to engage with the broader stock market. These contracts are designed to be affordable for individual investors, providing access to futures trading on the major market indexes, which have become prohibitively expensive for many. We’ll review what micro futures are and how they function. If you’re considering incorporating… read more…
- Beginner’s Guide to Copper Investing
Copper has resurged in demand, particularly in the industrial sector, rising roughly five times in value from 2001 to 2022. It is a versatile metal used heavily in home building, electronics, electrical conductivity, automobiles and infection control. It will benefit… read more…
- Understanding How Futures Are Traded
Futures trading is a fast-paced, risky and sometimes lucrative strategy that is most often used for hedging and speculation. Futures contracts are the trading vehicle. They call for the purchase or sale of an asset at some future date but at a price that is fixed today. The world’s largest marketplace for futures trading, CME… read more…
- Futures vs. Forwards: Key Differences
Futures and forwards offer an alternative to traditional stock investing. Both are types of derivative investments, in that their values are based on the value of underlying assets. Regardless of whether you’re investing in futures vs. forwards, both involve an agreement to buy and sell an asset at in the future. Here’s what you need… read more…
- Understanding the Dividend Growth Model
Dividend growth modeling helps investors determine a fair price for a company’s shares, using the stock’s current dividend, the expected future growth rate of the dividend and the required rate of return for the individual’s portfolio and financial goals. The dividend growth model is relatively easy to perform and can provide a helpful way to… read more…
- ETN versus ETF: Key Differences
As exchange-traded funds (ETFs) and exchange-traded notes (ETNs) continue to grow in popularity, investors often debate the advantages and disadvantages of each. Both options can help diversify a portfolio, but they come with distinct benefits and risks. While ETFs and ETNs share similarities, they also have key differences that are important to understand before making… read more…
- Understanding Underweight Stock Ratings
Financial analysts who are employed by investment firms research stocks and provide their opinions to investors about their possible future performance. Their opinion takes the form of a rating. An Underweight stock rating indicates to investors that it may not be a good investment. In other words, if a stock is rated by Wall Street… read more…
- How to Buy Nikola Stock (NKLA)
Nikola is an American automotive company focusing on creating zero-emission trucks. It was founded in 2014 and is based in Phoenix. Like Elon Musk’s popular electric car company, Tesla, Nikola is named for famous inventor Nikola Tesla, though it has no actual connection to the man. Though Nikola has produced several interesting vehicle concepts, it… read more…
- What Is Cost Basis and How Is It Calculated?
The cost basis of an asset is important to you for two primary reasons: tax planning and investment planning. These two reasons are related because only with the proper investment planning can you own a tax-efficient portfolio. You need to understand cost basis in order to plan the investment horizons of the various securities in… read more…
- What Is a Good Dividend Yield?
Dividends are regular cash payments corporations make to shareholders to incentivize them to invest in the company. The dividend yield is a percentage figure calculated by dividing the total annual dividend payments per share by the stock’s current share price. From 2% to 6% is considered a good dividend yield, but several factors can influence… read more…
- ETF vs. Stock: Key Differences
Owning stocks is important for driving returns in a portfolio. But one question to consider is whether it makes more sense to invest in individual shares or an exchange-traded fund (ETF) that includes a basket of stocks. Choosing between an ETF and one or more stocks can depend on your risk tolerance and goals, as… read more…
- Bisq Review 2025: Fees, Services and More
Bisq, formerly known as Bitsquare, is a decentralized cryptocurrency exchange with servers located around the globe. Bisq’s decentralized autonomous organization (DAO) means it isn’t headquartered in any one location or country, which gives it a number of advantages. You can use… read more…
- Stock Buybacks vs. Dividends: Key Differences
Stock investing can offer numerous rewards, including the potential to benefit from dividend payouts or buybacks. Both can increase investor returns but there are some significant differences in the tax treatment of stock buybacks vs. dividends. Whether it makes sense… read more…
- Investor’s Guide to Hedging
One of the most important aspects of investing is knowing how to manage risk. This is where hedging comes into play. A hedge can be a particular investment or investment strategy that’s designed to insulate your portfolio against risk. Hedging… read more…