FAQs tagged as

Investing-Basics

  1. Margin accounts are established to allow investors the ability to use leverage with their investments.

  2. What's the difference between book and market value?

  3. Why don't stocks begin trading at the previous day's closing price?

  4. What does it mean when a stock symbol has a .PK after it?

  5. Why do some stock symbols have three letters while others have four? What is the difference?

  6. If I am American, can I buy a foreign mutual fund?

  7. Where can I get a company's prospectus and/or financial statements?

  8. If I own stock that drops in price is this a sign that I should buy more?

  9. What exactly is a company's float?

  10. Why would a company have multiple share classes, and what are super voting shares?

  11. What investments are available to someone with no earned income?

  12. What is Fibonacci retracement, and where do the ratios that are used come from?

  13. What does 'froth' mean in terms of the real estate market?

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

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

  16. Is there a difference between ADR and ADS?

  17. Can someone who is not yet of legal age open a brokerage account?

  18. What is a debt/equity swap?

  19. What is the difference between open-market and closed-market transactions?

  20. Why do people say that September is the worst month for investing?

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

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

  23. What is socially responsible investing?

  24. How can I tell if I'm an emotional investor?

  25. What is the "squawk box scandal"?

  26. What does negative shareholder equity on a balance sheet mean?

  27. Which of the following terms are associated with the purchase/redemption of open-end investment company shares?

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

  29. What number of shares determines adequate liquidity for a stock?

  30. Where can I find a company's annual report and its SEC filings?

  31. Who or what is Dow Jones?

  32. What's the difference between a stop and a limit order?

  33. Is a company allowed to reduce its dividends?

  34. What is an efficient market and how does it affect individual investors?

  35. Can stocks be traded on more than one exchange, such as, for example, on both the Nasdaq and the NYSE?

  36. What happens to the fines collected by the Securities and Exchange Commission?

  37. What are the components of the risk premium for investments?

  38. How does an IPO get valued? What are some good methods for analyzing IPOs?

  39. I am a non-U.S. citizen living outside the U.S. and trading stocks through a U.S. internet broker. Do I have to pay taxes on the money I earn?

  40. Where do I place my target when the price of a stock breaks out of a technical chart pattern?

  41. How does leverage affect pip value?

  42. Is it possible to lose all of your investment in an index fund?

  43. Why are the bid and ask quotes usually so far away from each other in after-hours trading?

  44. Does a company's American depositary share equal one share of common stock?

  45. Why do some preferred stocks have a higher yield than common stocks?

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

  47. How should I estimate my income from fixed sources like bonds, CDs and stocks?

  48. One of my stocks missed the deadline to file its quarterly financial statements. What happens next?

  49. What is foreclosure investing?

  50. Where does the name "Wall Street" come from?

  51. Why don't investors buy stock just before the dividend date and sell right afterwards?

  52. Where can I find historical stock/index quotes?

  53. If I own a stock in a company, do I get a say in the company's operations?

  54. How do you calculate the percentage gain or loss on an investment?

  55. I've heard some "market gurus" claim returns of up to 400% annually. Is this possible?

  56. Who employs the specialists at New York Stock Exchange (NYSE)? Do they work for themselves, for the NYSE or for brokerage firms?

  57. There are so many stockbrokers out there. How do I go about choosing the best one for me?

  58. Can a stock have a negative price-to-earnings (P/E) ratio?

  59. I hold stock certificates in a company that just had a stock split. What happens now?

  60. What does the law say about non-U.S. citizens buying stocks of U.S. companies? Are there any restrictions?

  61. What does the 'FIG' at an investment bank refer to?

  62. What is the difference between a quote driven market and an order driven one?

  63. I keep hearing about the 50-day, 100-day and 200-day moving averages. What do they mean, how do they differ from each other, and what causes them to act as support or resistance?

  64. How do investors lose money when the stock market crashes?

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

  66. Given a good bookkeeping system, would financial accounting be necessary?

  67. Why do companies postpone earnings announcements?

  68. What does CHIPS UID mean?

  69. On what days are the American stock exchanges closed?

  70. I would like to invest in a dividend-paying stock. How can I find out which stocks pay dividends?

  71. What constitutes an "intention to call a debt instrument before maturity" for tax purposes?

  72. How can I budget for both short-term expenses and long-term goals?

  73. What is the "random walk theory" and what does it mean for investors?

  74. What are elves?

  75. Where can I find a list of all of the stocks in the S&P 500?

  76. What does "after the bell" mean?

  77. What's the difference between a mutual fund and a hedge fund?

  78. How rapidly can expanding sales reduce a firm's earnings?

  79. If the stock market is so volatile, why would I want to put my money into it?

  80. What does it mean when people say they "beat the market"? How do they know they have done so?

  81. Can a stock lose all its value? How would this affect a long or short position?

  82. What's the difference between absolute P/E ratio and relative P/E ratio?

  83. Are ETFs required to pay out a percentage of income as dividends?

  84. What is the weighted average of outstanding shares? How is it calculated?

  85. How do I calculate how much I've gained or lost on a stock holding?

  86. Which is a better measure for capital budgeting, IRR or NPV?

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

  88. When computing the PEG ratio for a stock, how is a company's earnings growth rate determined?

  89. 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?

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

  91. How does a depository bank benefit from issuing an ADR for a foreign company for free?

  92. Can investors short sell pink sheet or over-the-counter stocks?

  93. What are the advantages and disadvantages for a company going public?

  94. Is preferred stock an equity or a fixed-income security?

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

  96. When is a takeover bid legally canceled?

  97. When is earnings season?

  98. How much will it cost me to become a casual investor on my own?

  99. What is a back door listing?

  100. What was the Whitewater scandal?

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