Author: Arabian Media staff
While buy low and sell high is a strategy that has resulted in big accumulations of wealth, this isn’t how the professionals find their success. Instead, a savvy investor strategically deploys their money in order to allow it to work in more than one way—they multitask their money. The retail investor who is accustomed to working with stocks can simultaneously put their money to work in three ways: Price action—The stock will hopefully rise in value. Dividend—The fee a company pays you in exchange for using your money. Call revenue—The money an investor pays you when you sell a covered call…
Reviewed by Cierra MurryBiotechnology is one of the strangest, scariest, sexiest, and most interesting corners of the stock market. In how many other industries are companies striving literally to save lives? Any industry can host a stock that has the potential to double, but what other industry can match biotechnology in the sheer number of stocks that could double if their companies' plans come to fruition?On the other hand, in how many other industries do companies burn through hundreds of millions of dollars, often with nothing to show for it? How many other industries rely on scientific mysteries that can be…
There are several different ways one can diversify a portfolio, such as the different categories of the Morningstar style box, which contain several different asset classes. But another common way to diversify is between the various sectors of the economy. This is usually accomplished with mutual funds that concentrate in one of the major sectors, such as natural resources or utilities. This article will examine the nature and composition of sector funds and the advantages and disadvantages that they present to investors. Key Takeaways Sector mutual funds focus on a specific sector of the economy, such as energy or technology.…
As a business owner, you probably realize that operating and owning a business can be fraught with pitfalls and risks. Turning a profit isn’t enough; you must also protect your business from claims and lawsuits. Debts and mortgage obligations to third parties and vendors, claims for damages caused by your employees, product or professional liability, and consumer-protection issues are just some of the risks you must deal with. If handled improperly, these risks could result in the loss of both business and personal assets. Knowing what risks you face and how to minimize or avoid them gives you the chance to…
Opening a robo-advisor investment account is as easy as opening an online financial or banking account. Most robo-advisory accounts will be opened online, although if you select Fidelity, Schwab, or another platform with a physical office, you can also open the account in person. Before opening your account, it’s wise to read reviews and explore the websites of several digital investment advisors to pick the one that fits your financial goals. After selecting a robo-advisor, create an account and answer a few questions related to your goals, age, timeline, and risk tolerance level. This information helps ensure that the mix…
Two of the most attractive characteristics of options are that they afford an investor or trader the opportunity to achieve certain objectives and play the market in certain ways that they might not otherwise be able to. For example, if an investor is bearish on a particular stock or index, one of the choices is to sell short shares of the stock. While this is a perfectly viable investment alternative, it does have some negatives. First off, there are fairly sizable capital requirements. Second, there is technically unlimited risk, because there is no limit as to how far the stock could rise…
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The Basel III rules are a regulatory framework designed to strengthen financial institutions by placing guidelines pertaining to leverage ratios, capital requirements and liquidity. For investors in the banking sector, they create confidence that some of the mistakes made by banks that caused and contributed to the financial crisis in 2007-2008 will not be repeated. Key Takeaways Basel III is a regulatory framework aimed at strengthening financial institutions by setting guidelines on leverage ratios, capital requirements, and liquidity to prevent events like the 2007-2008 financial crisis.Under Basel III, banks must adhere to minimum leverage and capital requirements, such as maintaining…
Adaptation and survival often go hand in hand. True, some companies, such as Coca-Cola (KO), can figure out one thing, do it extremely well, and enjoy success decade after decade. For other major companies, though, continued prosperity has come from corporate governance and management teams willing to see a different future for the company and unafraid of making large-scale changes to the enterprise. Key Takeaways DuPont has historically evolved from a gunpowder supplier to a global leader in chemicals, pioneering numerous innovations like nylon, Teflon, and various plastics. This showcases the company’s commitment to research and development as a means…
Investors who buy stocks typically do so for one of two reasons: They believe that the price will rise and allow them to sell the stock at a profit, or they intend to collect the dividends paid on the stock as investment income. Of course, some stocks can satisfy both objectives, at least to some extent, but most stocks can be classified into one of three categories: growth, income, or value. Those who understand the characteristics of each type of stock can use this knowledge to grow their portfolios more efficiently. Key Takeaways Stocks generally fall into three main categories—growth, value,…