Investing - All Content

  1. What nations other than the U.S. have risk-free interest rates?

    Find out which countries have risk-free rates of returns. This is typically the yield on a 3-month note, and it can be negative ...
  2. What do mortgage lenders use the securitization food chain?

    Read about the origins of Chris Ferguson's securitization food chain, and find out how mortgage lenders could package and ...
  3. How can I calculate the notional value of a futures contract?

    Learn how the notional value of a futures contract is calculated, and how futures are different from stock since they have ...
  4. Do stock splits and stock dividends affect stockholder equity?

    Learn about stockholders' equity, stock splits and stock dividends and why stock splits and stock dividends do not affect ...
  5. What is a "non linear" exposure in Value at Risk (VaR)?

    Learn about nonlinearity and value at risk and what a nonlinear exposure is in the value at risk of a portfolio of nonlinear ...
  6. What licenses and certifications do you need for a career in portfolio management?

    See what it normally takes to begin a career in investment portfolio management, including education, experience, licenses ...
  7. What does positive theta mean for credit spreads?

    Learn about the option Greek theta and credit spreads, why credit spreads have positive thetas and what positive thetas signify ...
  8. What are the risks of investing in smaller regional airlines versus national or international ...

    Discover the risks involved in investing in regional airlines, including those caused by smaller balance sheets and more ...
  9. The Top 3 Silver ETFs

    Like any tradable asset, silver and silver ETF prices are governed by the fundamental market economic forces of supply and ...
  10. How China's GDP Is Calculated

    China is the world’s second-largest economy based on its GDP figures. Investopedia explains the methodology behind China’s ...
  11. Bitcoin Transactions Vs. Credit Card Transactions

    We provide an overview of the differences between bitcoin and credit card transactions, and the advantages of using one over ...
  12. What happens to the shares of a company that has been the object of a hostile takeover?

    Learn about the effect on the share price of companies that are targets of hostile takeovers, which are tactics used by famed ...
  13. What are the risks associated with investing in a treasury bond?

    Read about the risks of investing in risk-free U.S. Treasury bonds, including interest rate risk, inflation risk and opportunity ...
  14. What is the difference between a hostile takeover and a friendly takeover?

    Learn about the difference between a hostile takeover and a friendly takeover, and understand how proxy fights and tender ...
  15. How does a company decide which key performance indicators (KPIs) to use?

    Setting specific and actionable key performance indicators gives companies the ability to track the success and health of ...
  16. What emerging markets are best suited for investing in the aerospace sector?

    Discover the best emerging markets suited for investing in the aerospace sector and how middle class growth best positions ...
  17. How do waivers, reimbursements and recoupments affect a fund's expense ratio?

    Understand what waiver, reimbursement and recoupment agreements in relation to a mutual fund mean for the management fees ...
  18. Are investments in the drug sector appropriate for ethical investors?

    Explore the question of whether investments in the pharmaceutical industry are appropriate for investors who wish to pursue ...
  19. What criteria does a property need to meet to be considered an 'investment grade' ...

    Learn what it takes for institutional investors to consider a property "investment grade," such as real estate investment ...
  20. If an investor is short a dividend-paying stock on record date are they entitled ...

    Learn what short sellers must do when they are short a dividend-paying stock on record date.
  21. 4 Quality Dividend Stocks You Need to Consider

    Looking for quality stocks that also pay dividends? Consider these four.
  22. Top 6 Gas Stocks that Pay Regular Dividends

    A look at the top 6 dividend paying gas stocks.
  23. Real Estate Advice for Recent Retirees

    What retirees need to consider when it come to making real estate decisions.
  24. Best ETFs for Inflationary Worries

    Inflation may have been muted over the last few years, but that doesn’t mean investors should forget about it.
  25. How does unlevered beta help in risk management?

    Find out how unlevered beta can be used in risk identification and management, specifically as it relates to the CAPM valuation ...
  26. Which pro forma financial statements should always be included in a business plan?

    Understand which pro forma financial statements should be included in a business plan and why a pro forma financial statement ...
  27. What are some roles of an investment bank?

    Explore the world of investment banking and discover the various functions that investment bankers serve, such as handling ...
  28. When is a call option considered to be "in the money"?

    Learn about call options, their intrinsic values and why a call option is in the money when the underlying stock price is ...
  29. How do I close a long position in forex?

    Learn the different ways that traders close out existing long positions in the forex market, depending on whether their brokers ...
  30. What does a Z-Score tell a stock analyst about the health of a company?

    Learn about the Altman Z-score, what the Z-score measures and what it indicates to an analyst about the health of a company.
  31. What are the benefits for a company using equity financing vs. debt financing?

    Learn what some of the principal advantages are for a company that chooses to utilize equity financing in preference to debt ...
  32. What is the impact of retained earnings on stockholders equity?

    Learn about the relationship between retained earnings and stockholders' equity for a corporation and how it is reported ...
  33. What's the difference between budgeting and financial forecasting?

    Learn about financial budgeting and financial forecasting and the main differences between the two management decision-making ...
  34. Betting Basics: Fractional, Decimal & American Odds

    Betting odds are expressed in three popular formats: Fractional (British), Decimal (European) and American (Moneyline). So, ...
  35. Invest In Gold Through ETFs

    The mystique of the yellow metal captivates market players seeking hedges against inflationary pressure, safe haven in turbulent ...
  36. How To Best Analyze Relative Strength

    Relative strength indicators measure performance between similar instruments, uncovering opportunities that can translate ...
  37. A Guide To Finding The Most Actively Traded Stocks

    Knowing the trading volume of a stock helps traders understand price movements and forecast future movements. This short ...
  38. What are the most common leveraged ETFs that track the drugs sector?

    Discover the most common leveraged exchange-traded funds that investors can use for magnified results in the pharmaceutical ...
  39. What's the best investing strategy to have during a recession?

    Figure out how to take advantage of recessions, what assets to buy and which ones to avoid. Recessions are where some great ...
  40. Why should investors pay attention to a corporation's selling, general and administrative ...

    Learn about the importance of selling, general and administrative expenses. Find out why SG&A is important for fundamental ...
  41. What is required to become an accredited investor in a private placement?

    Learn how the SEC defines accredited investors, and understand exceptions to the requirements for an accredited investor ...
  42. Which is better: A high or low equity multiplier?

    Learn about the equity multiplier, how it is calculated, what it measures and why a low equity multiplier is preferred to ...
  43. How important are descending tops for a trading strategy?

    Find out what it means when a security or indicator is showing a descending tops pattern on a price chart, and what it says ...
  44. How does the combined ratio measure the financial health of insurance companies?

    Learn about the combined ratio, what the combined ratio measures and how it is used to measure the financial health of insurance ...
  45. How can stock dividends provide protection against inflation?

    Learn how dividends help protect against the effects of inflation by providing additional income and boosting consumers' ...
  46. What percentage of a diversified portfolio should be exposed to the aerospace sector?

    Learn how an investor's individual investing style determines how much of his diversified portfolio should be exposed to ...
  47. How can an investor profit from a decline in the aerospace sector?

    Learn about the different methods investors use to profit from a decline in the aerospace sector, including short selling ...
  48. What are the most popular forms of technical analysis?

    Technical analysis approaches the market by studying price and volume. It yields radically different insights and conjectures ...
  49. What is the difference between net income and cash flow from operating activities?

    Learn how net income differs from cash flow from operating activities and how noncash expenses and changes in working capital ...
  50. Top Oil Stocks that Pay Regular Dividends

    Eyeing oil stocks that pay regular dividends? Consider these refinery plays.
  51. Are These the Top Monthly Dividend Stocks?

    Interested in monthly dividends? Here are two stocks to watch.
  52. Beware: These Bond Funds Act Like Stocks

    Beware of bond funds that act like stocks.
  53. Why do banks securitize some debts, and how do they sell them to investors?

    Learn how and why banks securitize debt, how the securitized debt is sold to other investors, and how different the different ...
  54. Why would an investor consider purchasing electronic stocks for their portfolio?

    Discover why an investor would consider buying electronics securities as part of an investment portfolio and which stocks ...
  55. What should you take into consideration when choosing a portfolio management service?

    Understand several important issues and considerations when evaluating and choosing a potential portfolio manager and why ...
  56. What caused the stock market crash of 1929 that preceded The Great Depression?

    Find out what led to the stock market crash of 1929, which in turn led to the Great Depression. It sparked a nearly 90% loss ...
  57. Investing Early In The Future of Data Security

    Data breaches are becoming increasingly common. Among the foremost technologies paving the path for the future of data security ...
  58. 10 Most Famous Hedge Fund Managers

    The most famous hedge fund managers have made billions, but their fame might not always result from their financial successes.
  59. Bitcoin Vs. Litecoin: What's The Difference?

    Litecoin is often referred to as "the silver to Bitcoin's gold." But what is Litecoin, and how does it compare to its more ...
  60. What rights do all common shareholders have?

    Learn what rights all common shareholders have, and understand the remedies that can be taken if those rights are violated ...
  61. What is the average price-to-earnings ratio in the Internet sector?

    Learn what the average price-to-earnings ratio, or P/E ratio, is for companies in the Internet sector and how the sector ...
  62. What is the difference between technical analysis and fundamental analysis?

    Learn about technical analysis and fundamental analysis, the difference between the two methodologies and how they are used ...
  63. Which markets are most prone to market failure from adverse selection?

    Read about which markets are most prone to market failure from adverse selection and why information cannot effectively be ...
  64. Other than my savings account, what other types of holdings compound my interest?

    Understand the benefits of compounding interest, and learn the types of investments that offer compounding in addition to ...
  65. What does it mean to be absolutely risk averse?

    Learn about three kinds of investors: those comfortable with significant risk, those comfortable with limited risk and those ...
  66. How does adverse selection affect insurance premiums?

    Find out what causes adverse selection in the insurance market and why it drives up premiums for all policyholders.
  67. What is the relationship between the cash ratio and liquidity?

    Understand the relationship between a company's cash ratio and its liquidity. Learn what the cash ratio measures and what ...
  68. Why is the price to sales ratio commonly used for comparing companies in the Internet ...

    Find out why Internet stocks are valued, traded and compared to each other based on the price to sales ratio versus other ...
  69. Why Governments Are Afraid Of Bitcoin

    Bitcoin is the first decentralized peer-to-peer payment network and cryptocurrency. Governments may fear Bitcoin because ...
  70. How are Tweezer patterns interpreted by analysts and traders?

    Understand the basics of the tweezer candlestick pattern and how analysts and traders interpret this common but unreliable ...
  71. Are all fixed costs considered sunk costs?

    Find out why all sunk costs are considered fixed, but not all fixed costs are considered sunk; see why variable costs become ...
  72. What is the difference between work in progress (WIP) and raw materials in accounting?

    Learn about the difference in inventory financial accounting between works in progress and raw materials, as reported in ...
  73. What are some popular mutual funds that give exposure to the drugs sector?

    Discover some of the most widely traded and top-rated mutual funds that investors can use to make profits from gains in the ...
  74. Understanding Bottoms & Bottoming Patterns

    Analysis lowers the risk of bottom picking by identifying common characteristics of securities transitioning from downtrends ...
  75. Bitcoin 2.0 Applications

    The bitcoin blockchain enables the application of decentralized public ledgers for purposes other than digital currencies ...
  76. Feex: A Tool To Reduce Investment Management Fees

    If someone were to ask what the management fees are on your investment accounts, would you know the answer? The truth is ...
  77. What are some common risks that are unique to investing in the electronics sector?

    Learn more about the electronics sector and the unique risks and opportunities it presents to investors. Find out how to ...
  78. What is the correlation between equity risk premium and risk?

    Learn about the relationship between the risk-free rate of return and the equity risk premium, and understand how the risk-free ...
  79. What are some alternative liquidity ratios to the cash ratio?

    Learn what the cash ratio measures, and understand what two other liquidity ratios can be used by a company to replace the ...
  80. Why is a shareholder rights plan called a "poison pill?"

    Discover why shareholder rights plans are often called "poison pills" to fight hostile takeovers and give smaller corporations ...
  81. What does the cash ratio of a company measure, and how does it affect decision making?

    Learn what the cash ratio of a company measures, and understand why its an important liquidity ratio for a company to use ...
  82. Can the Efficient Market Hypothesis explain economic bubbles?

    Learn about the nuanced relationship between the efficient market hypothesis and economic bubbles and the requirements and ...
  83. What is Adverse Selection?

    Adverse selection occurs when one party in a transaction has more information than the other, especially in insurance and ...
  84. What is a Capital Account?

    Capital account is an economic term that refers to the net change in investment and asset ownership for a nation.
  85. Understanding Carrying Value

    Carrying value is the value of an asset as listed on a company’s balance sheet. Carrying value is the same as book value. ...
  86. Explaining Expected Return

    The expected return is a tool used to determine whether or not an investment has a positive or negative average net outcome. ...
  87. Understanding the Fisher Effect

    The Fisher effect states that the real interest rate equals the nominal interest rate minus the expected inflation rate. ...
  88. Explaining the Geometric Mean

    The average of a set of products, the calculation of which is commonly used to determine the performance results of an investment ...
  89. U.S. Investors Are Seeking Opportunities Overseas

    A latest analysis leads to believe that many investors are applying a spring cleaning approach to their portfolios, rebalancing ...
  90. What is Capital Stock?

    Capital stock refers to the number of authorized shares a corporation may issue, both common and preferred.
  91. Three Portfolio Moves To Consider Now

    What portfolio moves should you consider making as the 2nd quarter kicks off? Before we focus on the future, let’s first ...
  92. Manage Investments And Modern Portfolio Theory

    Modern Portfolio Theory suggests a static allocation which could be detrimental in declining markets, making it necessary ...
  93. Key Factors Of The Russell 2000 Index

    The Russell 2000 index represents the small cap universe, with a broad selection of fast growth companies at the bottom end ...
  94. The Labor Market Recovery’s Missing Ingredient

    Job creation is running at the fastest pace since the 90s, and there is some evidence that wage growth is finally starting ...
  95. Why These May Be the Top 4 Growth Stocks of 2015

    These four stocks have high upside potential in 2015.
  96. Gambling on Macau: Too Risky?

    Macau was once heralded as the new Las Vegas for casino investors. Is it too late?
  97. Why the House (and Las Vegas Sands) Always Wins

    An in depth look at how Las Vegas Sands became a multi-billion dollar company.
  98. What techniques are most useful for hedging exposure to the banking sector?

    Learn how investors hedge exposure to the banking sector by investing in more aggressive sectors and also by investing in ...
  99. How do I find the information needed for input into the Dividend Discount Model (DDM)?

    Learn where analysts and investors can find the three pieces of necessary information that allow them to calculate the dividend ...
  100. What does the Dividend Discount Model (DDM) show an investor about a company?

    Discover the purpose of the dividend discount model, or DDM, of stock analysis and what it specifically aims to evaluate ...
Frequently Asked Questions
  1. What are the primary sources of market risk?

    Learn about market risk and the four primary sources of market risk including equity, interest rate, foreign exchange and ...
  2. How does beta measure a stock's market risk?

    Learn how beta is used to measure risk versus the stock market, and understand how it is calculated and used in the capital ...
  3. How does the risk of investing in the electronics sector compare to the broader market?

    Learn how the electronics sector's risk compares to the broader market; discover real-world examples of how high exposure ...
  4. How much of a diversified portfolio should be invested in the electronics sector?

    Learn how investing style determines how much of a diversified portfolio an investor chooses to allocate to the electronics ...
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