The Stock Market Investing Guide

When people are talking about the stock market, the first thing that usually comes to mind is the New York Stock Exchange.

But what are stocks? Why is the stock market such a big thing? How do you invest in the stock market?

What are stocks?

Before you delve into the intricacies of the stock market, the first thing you should understand is what exactly a stock is.

Stocks, which are also known as shares, are portions of companies that people can buy, and therefore own part of the company. Continue reading The Stock Market Investing Guide

Market Update: The return of volatility

The return of volatility due to rising US political risks could open up opportunities. Fundamentals such as earnings and data are strong, especially in the Euro area and Asia.

Asia ex-Japan equities have been stable amid the volatility, underscoring our strong preference for the market. The S&P500 faces a technical support 2% below current levels.

We expect Treasury yields to return to the 2.30-2.65% range once political risks abate. This means we would await better entry points for rate-sensitive USD bonds. Continue reading Market Update: The return of volatility

The risks in the derivatives markets are growing

The Wall Street Journal published an article on titled “Credit Derivatives And Their Risks Are On The Table” by Henny Sender.

In the article, Sender advised that the Fed was gathering the big Wall Street players to discuss the rising concerns about risk in what is known as the credit-derivatives markets.

Sender goes on to make the case that the clearing structure of the dealers and hedge funds is not keeping pace with the exploding growth in these complex financial instruments.

Confirmations of these trades are falling behind the growth of the trades and the paper is stacking up both at the dealers and the hedge funds. Continue reading The risks in the derivatives markets are growing

What is a Certificate of Deposit?

A certificate of deposit, also known as a CD, is a short to medium term investment made with a bank or savings and loans institution.

The basic idea is that you agree to deposit a certain sum of money for a period of time, typically anywhere from three months to six years, in exchange for a locked interest rate.

This interest rate will generally be higher than that of a traditional savings account. After the length of the CD has expired, the initial balance will have increased substantially due to the accrued interest.

Continue reading What is a Certificate of Deposit?

Beginners guide to investing in stocks

You need to begin your beginner investing by performing an assessment of your personal finances. If you wish to invest in stocks, bonds, mutual funds or even real estate, you need capital to invest.

Construct a net worth statement which will list your assets (cash, private property, savings, etc) as well as your debts (loans, credit cards, mortgage, etc).

Look closely at your debt position and determine if you can afford to invest now. It is much better to pay off high interest debt (12% or higher) that it is to invest the same money and earn 10% per year.

If you need help with this net worth statement, simply go to Microsoft’s’ site and download a free evaluation copy of Money.

It explains step by step how to create this statement.

Now for the next step in Investing for Beginners… Continue reading Beginners guide to investing in stocks