Chad Langager

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  1. What does it mean when financial news reports say that more ...
    Investing

    What does it mean when financial news reports say that more ...

    This simply means that in a market, more stocks (issues) traded down for the day compared to the number of companies that traded up for the day.When a stock or issue is considered to be bought it must ...
  2. Why would a company make drastic cuts to its dividend payments?
    Investing

    Why would a company make drastic cuts to its dividend payments?

    A dividend cut occurs when a dividend paying company either completely stops paying out dividends (a worst-case scenario) or reduces the amount it pays out. This will often lead to a sharp decline in the ...
  3. Start Investing With Only $1,000
    Investing Basics

    Start Investing With Only $1,000

    Find out what fees and restrictions need to be considered before investing $1,000.
  4. Having A Plan: The Basis Of Success
    Options & Futures

    Having A Plan: The Basis Of Success

    It ensures that you have a realistic outlook, and a solid strategy. We show you why and how.
  5. How can you lose more money than you invest shorting a stock? ...
    Active Trading Fundamentals

    How can you lose more money than you invest shorting a stock? ...

    The simple answer to this question is that there is no limit to the amount of money you can lose in a short sale. This means that you can lose more than the original amount you received at the beginning ...
  6. What are the components of the risk premium for investments?
    Investing

    What are the components of the risk premium for investments?

    The risk premium is the excess return above the risk-free rate that investors require as compensation for the higher uncertainty associated with risky assets. The five main risks that comprise the risk ...
  7. Why do low interest rates cause investors to shy away from ...
    Investing

    Why do low interest rates cause investors to shy away from ...

    The lower rates that are found on bonds, especially government-backed bonds, are often not seen as enough by investors. This is the main driving force behind investors not wanting to invest in bonds. Most ...
  8. What is a GTEM order?
    Trading Strategies

    What is a GTEM order?

    GTEM stands for "good 'til extended market". This is a type of duration order that investors can place with their brokers, which determines how long the order will remain active. A GTEM buy or sell order ...
  9. Why do you need a margin account to short sell stocks?
    Active Trading Fundamentals

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

    The reason that margin accounts and only margin accounts can be used to short sell stocks has to do with Regulation T, a rule instituted by the Federal Reserve Board. This rule is motivated by the nature ...
  10. How does the marginal tax rate system work?
    Investing

    How does the marginal tax rate system work?

    The marginal tax rate is the rate of tax that income earners incur on each additional dollar of income. As the marginal tax rate increases, the taxpayer ends up with less money per dollar earned than he ...
  11. What causes a significant move in the stock market?
    Investing

    What causes a significant move in the stock market?

    There is a nearly infinite number of factors that can cause the stock market to move significantly in one direction or another. This can include such things as economic data, geopolitical events and market ...
  12. What is a virtual trailing stop order (VTSO)?
    Trading Strategies

    What is a virtual trailing stop order (VTSO)?

    A virtual trailing stop order (VTSO), is a stop order that adjusts as the price of a security moves. The stop price is placed at a set distance above or below the market price depending on whether it is ...
  13. If I short sell $5,000 worth of stock and the stock becomes ...
    Active Trading Fundamentals

    If I short sell $5,000 worth of stock and the stock becomes ...

    The simple answer is that the maximum return of any short sale investment is in fact 100%. However, the concepts underlying short selling - the borrowing of shares and the liability it forms, how returns ...
  14. How do I measure option liquidity?
    Options & Futures

    How do I measure option liquidity?

    An option is a financial instrument that gives the holder the right to purchase shares in a company at a certain set price (strike price) before a set date known as the expiration date. Options, however, ...
  15. If I sell my shares before the ex-dividend date will I still ...
    Investing

    If I sell my shares before the ex-dividend date will I still ...

    If you sell before the ex-dividend date you will not receive a dividend from the company. The ex-dividend date is the date that the company has designated as the first day of trading in which the shares ...
  16. What happens to my call options if the underlying company ...
    Options & Futures

    What happens to my call options if the underlying company ...

    Typically, the announcement of a buyout offer by another company is a good thing for shareholders in the company that is being purchased. This is because the offer is generally at a premium to the market ...
  17. What happens when the lender of the borrowed shares in a ...
    Active Trading Fundamentals

    What happens when the lender of the borrowed shares in a ...

    In a short sale transaction, shares are borrowed from the lender by the short seller and sold in the market. The lender of these shares continues to maintain a long position, hoping the shares will go ...
  18. How do I figure out my cost basis on a stock investment?
    Investing

    How do I figure out my cost basis on a stock investment?

    The cost basis of any investment is the original value of an asset adjusted for stock splits, dividends and capital distributions. It is used to calculate the capital gain or loss on an investment for ...
  19. What is the relationship between oil prices and inflation?
    Investing

    What is the relationship between oil prices and inflation?

    The price of oil and inflation are often seen as being connected in a cause and effect relationship. As oil prices move up or down, inflation follows in the same direction. The reason why this happens ...
  20. Where do investors tend to put their money in a bear market?
    Investing

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

    A bearish market is traditionally defined as a period of negative returns in the broader market to the magnitude of between 15-20% or more. During this type of market, most stocks see their share prices ...
  21. What are the minimum margin requirements for a short sale ...
    Active Trading Fundamentals

    What are the minimum margin requirements for a short sale ...

    In a short sale transaction, the investor borrows shares and sells them on the market in the hope that the share price will decrease and he or she will be able to buy them back at a lower price. The proceeds ...
  22. What is the difference between an industry and a sector?
    Investing

    What is the difference between an industry and a sector?

    The terms industry and sector are often used interchangeably to describe a group of companies that operate in the same segment of the economy or share a similar business type. Although the terms are commonly ...
  23. I am a non-U.S. citizen living outside the U.S. and trading ...
    Investing

    I am a non-U.S. citizen living outside the U.S. and trading ...

    The tax implications for a foreign investor will depend on whether that person is classified as a resident alien or a non-resident alien. To be considered a non-resident alien, a person must meet several ...
  24. When short selling a stock, how long does a short seller ...
    Active Trading Fundamentals

    When short selling a stock, how long does a short seller ...

    There are no general rules regarding how long a short sale can last before being closed out. A short sale is a transaction in which shares of a company are borrowed by an investor and sold on the market. ...
  25. Why do commercial bills have higher yields than T-bills?
    Investing

    Why do commercial bills have higher yields than T-bills?

    The reason that commercial bills have higher yields than T-bills is due to the varying credit quality of each bill type. The credit rating of the entity issuing the bill gives investors an idea of the ...
  26. How is a put option exercised?
    Options & Futures

    How is a put option exercised?

    A put option is a contract that gives the option holder the right, but not obligation, to sell a set amount of shares (100 shares per contract) at a set price. If the option is exercised, the option writer ...
  27. How can a futures trader exit a position prior to expiration?
    Trading Strategies

    How can a futures trader exit a position prior to expiration?

    A futures contract is an agreement to buy or sell a commodity at a pre-determined price and quantity at a future date in time. While this is similar to an option, where the holder has the right to purchase ...
  28. Why does my broker allow me to enter only day orders for ...
    Active Trading Fundamentals

    Why does my broker allow me to enter only day orders for ...

    Put simply, brokerage firms restrict short sales to day orders because of the complexity of the short sale transaction and the difficulty in authorizing shares to be short sold in a rapidly changing environment.Long-term ...
  29. Is it true that you can sell your home and not pay capital ...
    Investing

    Is it true that you can sell your home and not pay capital ...

    It is true in most cases. When you sell your home, the capital gains on the sale are exempt from capital gains tax. Based on the Taxpayer Relief Act of 1997, if you are single, you will pay no capital ...
  30. Where can I get bond market quotes?
    Investing

    Where can I get bond market quotes?

    Getting bond quotes and general information about a bond issue is considerably more difficult than researching a stock or a mutual fund. A major reason for this is that there is not a lot of individual ...
  31. Why do all mutual fund tickers have an X at the end?
    Investing

    Why do all mutual fund tickers have an X at the end?

    It's true that all mutual funds' tickers have an X at the end of their symbol. The reason for this is to distinguish between mutual fund tickers and other securities that also have ticker symbols (such ...
  32. What is the short/current long-term debt account on a company's ...
    Investing

    What is the short/current long-term debt account on a company's ...

    A lot of confusion can arise with this balance sheet account. After all, how can something be both long and short? Despite appearances, however, this concept is not as complex as one might first think. ...
  33. If I pay for a course to learn about trading can I write ...
    Investing

    If I pay for a course to learn about trading can I write ...

    There are some investing costs that can be written off each year, even if you aren't a day trader. The general rule in determining whether an investment expense is deductible is that the expense needs ...
  34. What are the fifth-letter identifiers on the Nasdaq?
    Investing

    What are the fifth-letter identifiers on the Nasdaq?

    All of the companies traded on the Nasdaq have four-lettered tickers, which are representative of the actual company. For example, the ticker symbol for Nasdaq-traded Microsoft is MSFT. However, in some ...
  35. What is a basis point (BPS)?
    Investing

    What is a basis point (BPS)?

    A basis point is a unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument. One basis point is equivalent to 0.01% (1/100th of a percent) or 0. ...
  36. What is an assumable mortgage?
    Investing

    What is an assumable mortgage?

    The purchase of a home is a very expensive undertaking and usually requires some form of financing to make the purchase possible. In most cases, the potential buyer goes to the bank and takes out a mortgage ...
  37. Where can I find information about pre- and after-hours ...
    Trading Strategies

    Where can I find information about pre- and after-hours ...

    The stock market, particularly the NYSE and Nasdaq, is traditionally open between 9:30am and 4pm EST. Over time, with the adoption of new technology and increases in demand for trading, these hours have ...
  38. Who or what are the turtles?
    Trading Systems & Software

    Who or what are the turtles?

    The "turtles" was a nickname given to a group of traders who were a part of an experiment run by two famous commodity traders. In 1983, Richard Dennis and Bill Eckhardt pondered the idea of whether being ...
  39. What are the risks of investing in a bond?
    Investing

    What are the risks of investing in a bond?

    The most well-known risk in the bond market is interest rate risk - the risk that bond prices will fall as interest rates rise. By buying a bond, the bondholder has committed to receiving a fixed rate ...
  40. How is my credit score calculated?
    Credit & Loans

    How is my credit score calculated?

    The credit score, commonly referred to as a FICO score, is a proprietary tool created by the Fair Isaac Corporation. This is not the only way to get a credit score, but the FICO score is the measure that ...
  41. What are reverse stock splits?
    Investing

    What are reverse stock splits?

    A reverse stock split is a corporate action in which a company reduces the number of shares it has outstanding by a set multiple. This is the opposite of a stock split, in which a company increases its ...
  42. Why does a crisis in emerging markets cause U.S. Treasury ...
    Investing

    Why does a crisis in emerging markets cause U.S. Treasury ...

    The reason that you will often see the yields on Treasuries fall when you see a financial crisis in an emerging or foreign market is due to what is known as a flight to quality. A flight to quality occurs ...
  43. I live in the U.S. How can I trade stocks in China and India?
    Investing

    I live in the U.S. How can I trade stocks in China and India?

    Foreign markets have always been an object of envy to domestic investors because the indexes in some foreign countries have produced double- to triple-digit returns in the past. For example, the SETI 1 ...
  44. Do I own a stock as of the trade date or the settlement ...
    Options & Futures

    Do I own a stock as of the trade date or the settlement ...

    When it comes to buying shares, there are two key dates involved in the transaction. The first date is the trade date, which is simply the date that the order is executed in the market. The second date ...
  45. What does it mean when the shares in my account have been ...
    Investing

    What does it mean when the shares in my account have been ...

    An account liquidation occurs when the holdings of an account are sold off by the firm in which the account was created. In the majority of cases, this will deal with problems arising with margin requirements. ...
  46. How does a credit crunch occur?
    Investing

    How does a credit crunch occur?

    A credit crunch occurs when there is a lack of funds available in the credit market, making it difficult for borrowers to obtain financing. This happens when lenders have limited funds available to lend ...
  47. What is a convertible bond?
    Investing

    What is a convertible bond?

    A convertible bond is a bond issued by a corporation that, unlike a regular bond, gives the bondholder the option to trade in the bond for shares in the company that issued it. This gives the bondholder ...
  48. What is the difference between a quote driven market and ...
    Investing

    What is the difference between a quote driven market and ...

    The difference between these two market systems lies in what is displayed in the market in terms of orders and bid and ask prices. The order driven market displays all of the bids and asks, while the quote ...
  49. Can an option have a negative strike price?
    Options & Futures

    Can an option have a negative strike price?

    The simple answer is that, at least when it comes to exchange traded options, an option can't have a negative strike price .Remember that an option gives the holder the right, but not the obligation, to ...
  50. When is earnings season?
    Investing

    When is earnings season?

    Earnings season is the period of time during which a large number of publicly traded companies release their quarterly earning reports. In general, each earnings season begins one or two weeks after the ...
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