Investing FAQs

  1. Calculate the total return of the municipal bond described below.

  2. What is the difference between preferred stock and common stock?

  3. What is the incentive to buy a stock without dividends?

  4. What is a wrap account and what are the advantages of using one?

  5. What is mutual fund timing, and why is it so bad?

  6. What are unrealized gains and losses?

  7. Is a company allowed to reduce its dividends?

  8. Which option is better on a mutual fund: a growth option or a dividend reinvestment option?

  9. How do stock splits affect short sellers?

  10. If one of your stocks splits, doesn't that make it a better investment? If one of your stocks splits 2-1, wouldn't you then have twice as many shares? Wouldn't your share of the company's earnings then be twice as large?

  11. What is the difference between a company's book value per share and its intrinsic value per share?

  12. I want to invest in equities, but I don't have much money. Is there a minimum number of shares I must buy?

  13. Would a slow stochastic be effective in day trading?

  14. Is tracking error a significant measure for determining ex-post risk?

  15. Why would a stock that pays a large, consistent dividend have less price volatility in the market than a stock that doesn't pay dividends?

  16. What is property, plant and equipment, and what does it mean?

  17. Why do futures' prices converge upon spot prices during the delivery month?

  18. How does a person gain from an investment?

  19. How can I use market breadth to my advantage?

  20. Are mutual fund performance numbers reported net of fees (operating expenses and 12b-1)?

  21. How do I calculate the percentage gain or loss for my portfolio when all of the stocks have different prices?

  22. What are green investments?

  23. What is a Bermuda swaption?

  24. What is accrued interest, and why do I have to pay it when I buy a bond?

  25. Are my investments insured?

  26. Why are the bid prices of T-bills higher than the ask prices? Aren't bids supposed to be lower than ask prices?

  27. What is a DRIP?

  28. How do I take qualitative factors into consideration when using fundamental analysis?

  29. How can you lose more money than you invest shorting a stock? If you have no money left in your account, how do you pay it back?

  30. Why are some shares priced in the hundreds or thousands of dollars, while other just as successful companies have more normal share prices? For example, how can Berkshire Hathaway's be over $80,000/share, when the shares of even larger companies are only

  31. Can investment real estate be purchased within an IRA and, if so, are there any pitfalls?

  32. Should I buy options that are in the money or out of the money?

  33. Is a Canadian resident allowed to participate in a direct stock purchase plan from a U.S. company such as Pfizer?

  34. If different bond markets use different day-count conventions, how do I know which one is used in any particular market?

  35. What is the difference between hedging and speculation?

  36. What happens if a company doesn't think it will collect on some of its receivables?

  37. Are ETFs subject to the short sale uptick rule?

  38. Are eurodollars related to the currency called the euro?

  39. Where do investors tend to put their money in a bear market?

  40. Can I sell mutual fund shares below their minimum intial purchase amount without being penalized?

  41. Who bears the risk of bad debts in securitization?

  42. Is there a difference between socially responsible investing (SRI) and green investing?

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

  44. What is the difference between asset-based lending and asset financing?

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

  46. What does it mean to book the basis?

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