Investing FAQs

  1. How does a stop-loss order work, and what price is used to trigger the order?

  2. Does a stock dividend dilute the price per share as would a forward stock split?

  3. How do you calculate the cost basis for a mutual fund over an extended time period?

  4. Why would a multinational corporation conduct a vertical foreign direct investment?

  5. Why does a crisis in emerging markets cause U.S. Treasury yields to decrease?

  6. Why doesn't the price of a callable bond exceed its call price when interest rates are falling?

  7. What is securitization?

  8. Is there such a thing as a foolproof stock-picking strategy?

  9. How can I buy oil as an investment?

  10. When you buy a stock in a company, does it necessarily mean that one of the shareholders is selling it to you?

  11. Why are P/E ratios generally higher during times of low inflation?

  12. What exactly is a portfolio? Is it something I can carry around?

  13. What is the 'Rule of 72'?

  14. A corporate bond I own has just been called by the issuer. How can a company legally take away my bond? How do these call provisions work?

  15. Why do you need a margin account to short sell stocks?

  16. Which is better a cash dividend or a stock dividend?

  17. What's the difference between net present value and internal rate of return? How are they used?

  18. What is the difference between iShares, VIPERs and Spiders?

  19. How are realized profits different from unrealized or so-called "paper" profits?

  20. I want to try short selling, but how can I sell something that I don't own?

  21. How do businesses decide whether to do FDI via green field investments or acquisitions?

  22. How do I avoid paying excess taxes on securities I have sold?

  23. Can an open-ended fund's price appreciate significantly?

  24. Are mortgage-backed securities backed by any guarantees?

  25. How can I find out if a company I like is included in an index?

  26. What is an echo bubble?

  27. Where can I buy government bonds?

  28. Where can I find the P/E ratios for the Dow and S&P 500?

  29. What is the difference between a global fund and an international fund?

  30. What is arbitrage?

  31. I have discovered that a bond I am interested in has a sinking fund. What does this mean?

  32. What is the ideal number of stocks to have in a portfolio?

  33. What do people mean when they say debt is a relatively cheaper form of finance than equity?

  34. What is a spider and why should I buy one?

  35. What's the difference between short-term investments in marketable securities and equity?

  36. Is there a difference between ADR and ADS?

  37. What are 'death spiral' convertible bonds?

  38. How do segregated funds differ from mutual funds?

  39. Where can I find the number of shares shorted on a specific stock?

  40. I sold my house. Can I exclude the gain from my income?

  41. Can I give stock as a gift?

  42. How do central banks inject money into the economy?

  43. Can private corporations issue convertible bonds?

  44. The risk an investor is most likely to encounter when investing in a Standard & Poor’s 500 Index fund is:

  45. What is the quickest, easiest and cheapest way to buy a bond?

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