- Federal Funds Rate: Definition and Use
Set by the Federal Open Market Committee (FOMC), the federal funds rate directly controls whether banks will lend any excess reserves to meet federal requirements. This rate has a huge impact on inflation, short-term borrowing and even investing. In this… read more…
- Webull vs. Robinhood
Webull and Robinhood are two popular online stock trading platforms where users can invest and make trades largely commission-free. Webull advertises itself as much to the desktop market as to app-based users, if not more, and tends to aim toward more… read more…
- What Is a Volatility ETF, and How Does It Work?
A volatility ETF is an exchange traded fund (ETF) that tracks share price changes in a specific index of the stock market. These funds make their money based on the degree to which prices are changing across the market. The specifics are different based on individual funds, as various volatility ETFs offer exposure to volatility… read more…
- How Blank Check Companies (SPACs) Work
A special purpose acquisition company (SPAC), also known as a blank check company, is a publicly traded company created for the purpose of buying or merging with another company or companies. For reasons explained below, the Securities and Exchange Commission (SEC)… read more…
- What Is a Sophisticated Investor? Definition and Requirements
One way the U.S. Securities and Exchange Commission (SEC) protects investors is by restricting who can put their money into particularly high-risk, loosely regulated or complex financial offerings. While anyone who has the money can buy stocks and bonds, the… read more…
- What Are Dilutive Securities?
Dilutive securities are any financial instrument that can increase the number of shares a company has outstanding. Examples include convertible bonds, options, warrants and preferred stock. The effect of dilutive securities is to reduce the price of shares and earnings attributable to each share. That’s one reason many shareholders object when a board of directors… read more…
- What Is a Good Earnings Per Share (EPS) Ratio?
When deciding where to invest your money, there are different ratios you can use to find the right companies to back. One of them is earnings per share (EPS), which is one way to measure a company’s profitability. The higher… read more…
- What Is “Buy the Dip” in Investing
Buying the dip is a tactic in which traders buy an asset, usually a stock, immediately after its price declines, anticipating that the price will go back up in the near term. There are many reasons why a trader might employ… read more…
- What Types of Assets Are Illiquid?
One of the most important features of an asset is how quickly or slowly it can be converted into cash. Whether it’s investors seeking details about a company’s finances or market players trying to figure out the fair market value,… read more…
- What Are Series I Savings Bonds?
If you’re in a position of wanting protection or stability in your portfolio then you should consider Series I bonds. These are bonds issued by the U.S. government that carry a zero-coupon interest rate and are annually adjusted for inflation. The… read more…
- EBITDA vs. Revenue: What You Need to Know
While a company’s sales, also known as revenue, often get a great deal of attention from the public, business owners, managers, investors and lenders pay particularly close attention to another key metric, EBITDA. EBITDA stands for “earnings before interest, taxes, depreciation and amortization.” It is a more nuanced tool than revenue and can illuminate how… read more…
- Commercial Mortgage-Backed Securities (CMBS)?
A commercial mortgage-backed security (CMBS) is a type of income-generating security that’s backed by commercial real estate mortgages instead of residential property mortgages. These assets can be good investments in one regard, given the steady returns they generate but are… read more…
- How to Invest in Esports
StarCraft changed the world. This computer game was arguably the first major esport, or electronic sport, with immense popularity and a professional circuit in many parts of the world, particularly the U.S. and East Asia. Today many games have a… read more…
- How Asset Turnover Ratio Helps Investors
One of the most important questions for investors is how efficiently a company uses its assets generate revenue. This information is not readily found in the most common financial reports, such as balance sheets. The performance numbers of a large business… read more…
- A Guide to FAANG Stocks and Funds
The FAANG stocks are a collection of five high-value securities in the tech sector and some of the most valuable shares traded on the U.S. exchanges. Together they are Facebook, Amazon, Apple, Netflix and Google. The stocks in the FAANG… read more…
- What Is the Russell 2000 Index?
The Russell 2000 Index is a stock market index that measures the performance of approximately 2,000 of the smallest-capitalization U.S. corporations in the Russell 3000 Index, which is made up of 3,000 of the largest American stocks. It is a useful alternative to… read more…
- Bitcoin: What Is It, History and How to Buy
Bitcoin is one of the most valuable and volatile assets on the market. By February 2021 it had soared to an intraday high of nearly $60,000, more than nine times a year-earlier intraday level. Whether you’re interested in this cryptocurrency… read more…
- What Is a Japanese Candlestick Chart?
Perhaps the single greatest mistake that investors make is the idea that trading is a purely technical practice, one driven exclusively by the logic of numbers. But the truth is that traders work on emotion just as often as they… read more…
- What Is a Blend Fund?
Mutual funds and exchange-traded funds can make investing easier. Instead of buying individual stocks or bonds, you can buy a collection of them in a single fund. But all mutual funds aren’t the same, and it’s important to know what… read more…
- How to Calculate Free Cash Flow (FCF)
Free cash flow is a measure that helps business owners, investors and others assess a business’s financial performance and outlook. Free cash flow is defined as operating cash flow minus capital expenditures. Strong free cash flow can indicate that a company is… read more…
- How Insurance Planning Fits Into a Financial Plan
As you build your wealth, it’s important to protect your assets against any unforeseen events. While not as direct a way of saving as investing, insurance planning can save you significant amounts of money over the long-term. Think of insurance… read more…
- What Happens to an Annuity When You Die?
Planning for the future involves understanding what happens to your financial assets after you’re gone. Annuities, which provide regular income payments during retirement, are a common investment vehicle, but what happens to an annuity when you die? The answer depends largely on the type of annuity you own and the specific provisions outlined in your… read more…
- Balance Sheets vs. Income Statements
Three financial documents can evaluate the health of a business: the balance sheet, the income statement and the cash flow statement. Each measures and reports on different aspects of a company’s financial condition. However, the balance sheet and income statement… read more…
- Accredited Investment Fiduciary Analyst (AIFA)
When you go to a doctor, you may prefer one who puts your health first. When it comes to your money, you likely want a professional with your interests in mind. An Accredited Investment Fiduciary Analyst (AIFA) can work in your best interests. Here’s how people get that title and how they work for you.… read more…
- What Is a Sovereign Wealth Fund?
Personal investing is one thing, but can governments invest too? (Hint: The answer is yes.) A sovereign wealth fund, or SWF, is a state-owned investment fund that taps into a country’s cash reserves. The goals of an SWF are to… read more…