Video Professor

Online Investing Basics

Video Professor Reviews: If you have been thinking about investing in the stock market, you’ve probably done some research on the subject. Perhaps this article is part of that research. Depending on how far into the decision making process you are, you will at some point need to decide how you are going to handle your investment transactions.

In the days before the Internet, if you wanted to invest your money you had to go through a banker or stockbroker. You still can as a matter of fact. Doing so most definitely has its advantages.

If you choose to invest via a stockbroker you will have to pay for it. Usually their fee is based on a percentage of your portfolio. Investing through a broker is a wise decision to make when you do not know a whole lot about investing money. You are paying for expert guidance and assistance. Your broker will handle many of your investing decisions and because of this piece of mind you pay a fee.

However, more and more individuals are realizing the advantages of investing money online. For the new investor, investing money online can be an intimidating proposition. It can be disconcerting to some because they do not feel secure in handling such important transactions online. However, such concerns, while valid, should not prevent you from investing money online.

The advantages of investing money online are many. Investors are able to expedite their trades, and in some cases, execute trades in real time. Investors also find that they enjoy the control they have over their portfolios. After all, no one cares about your money more than you. Additionally, investing money online does not mean you are forsaking the client/broker relationship. In fact, many online brokerage firms are just extensions of the brick and mortar firms you may have heard of. Many times, you do not have to pay a fee to discuss your investing strategy with your broker.

If you are considering investing money online via an online broker, you should spend the time researching and test-driving the options each broker has. Each site has different user interfaces and offers different versions of the same service. You may find that you like one site’s research options but dislike the overall layout. Likewise, you might decide to go with a specific online broker because you like their commission structure and mutual fund choices.

Investing money online should not be an intimidating choice. The security features in place ensure that your transactions will be safe handled. Investing online is one of the most convenient ways to invest your hard-earned money.

Money Market Investing Basics

As we inch ever closer to a recession, it is wise for investors to examine their portfolios to make sure they are protected if the market makes significant downturns. Perhaps one of the best ways to protect your investments during such unstable times is to re-allocate your investments into stable securities such as money market funds.

Money market investing is one of the more conservative plays investors can make. Outside of an FDIC insured savings account or certificate of deposit, the money market fund is the next best place for conservative investors to invest their money. For those of you unfamiliar with money market investing, this article will provide a brief overview on the basics of money markets and what you need to know to begin investing in a money market fund.

First and foremost, a money market fund is very similar to a mutual fund, so it is important to note that investing in a money market fund carries some risk. That being said, money market funds have traditionally been very stable investments. Like a mutual fund, money market funds are managed by an individual or individuals who buy and sell securities that comprise the fund. Similarly, the money market fund will be governed by an investment objective — usually stable long-term capital appreciation.

Investors buy into a money market fund the same way they would a mutual fund. You can purchase lump-sum shares or invest small amounts of cash at a time. Usually, the money market fund will have minimum investments and fees associated with it. Additionally, there are money market funds specifically tailored for investors who are investing large sums of cash in excess of hundreds of thousands of dollars. How you choose to invest is up to you.

One of the biggest advantages of investing in money market funds is that they allow you to access your cash very quickly — some the next day, some immediately. However, unlike a high-yield savings account, money market funds are not FDIC insured securities. That means that you will lose money if the fund performs poorly.

When speaking about liquidity, your needs will determine whether or not you should purchase a “purchased” or “sweep” fund. Purchased money market funds afford next-business-day liquidity and are bought and sold like other securities you are invested in. But, unlike these other securities they don’t charge fees for additional transactions. A “sweep” money market fund affords the investor same-day liquidity by trading shares to cover transactions such as trading or check writing. While purchased funds may have initial investments and minimums, sweep funds typically have higher fees and require more household assets to participate.

If you are thinking about investing and want a conservative investment vehicle, money market investing is worth considering. Just remember, that while relatively safe, they are not risk-free.

Beginners Guide to Investing in Euros

As the value of the American dollar continues to decline, in relation to other currencies, interest in investing in Euros has increased. There are hundreds of web sites dealing with this current trend in the market. Money-Zine.com has a great article about investing Euros that I think you will find interesting.

 Euros Versus Dollars

 Currently the Euro is trading around $1.46 U.S dollars – on the stock exchange floor, this is known as the exchange rate. That means, it costs $1.46 to purchase one Euro. About a year ago, in 2006, Euros were trading at around $1.26. Understanding that the difference in prices means that the Euro is not fixed to the dollar, means that you can see that there is an opportunity to make or lose money from the change in the exchange rate over time.

So, if the value of the dollar declines relative to the Euro, then you, the investor, can make money from this decline. Let’s look at this opportunity a little closer.

 How and Why the Euro Exchange Rate Changes

Investing in Euros does not guarantee you a profit. If you think about the global economy, one of the major factors that affect the value of a currency is the faith in that country’s economy. If one country’s economy is weakening relative to another, then over time there should be a change in the exchange rate.

For example, if investors believe that the dollar will weaken against the Euro, then that means they think Euros will be worth more in the future in terms of dollars. Over the past twelve moths, that is exactly what happened. If you purchased 100 Euros last year, it would have cost you $126. If you traded those 100 Euros back in for dollars today, you would have gotten $146. So you would have received a gain of $20.00, which is a 15.8 percent return on the $126 investment.

In order to combat inflation here in the United States, the Federal Reserve has been keeping interest rates relatively low. Specifically, they have been low relative to interest rates found in Europe. This brings up the second reason for investing in Euros - taking advantage of higher interest rates in Europe relative to the United States.

By taking U.S. Dollars and buying government bonds, in Euros, then the investor has a second chance to earn a higher return on their investment.

 Risks Involved When Investing In Euros

When you invest in a foreign currency, you are placing a bet that the Euro will grow in value relative to the dollar. Before you place a bet like that, you need to understand the relationship over the past several years and try to predict what might happen in the future. In this case, the Euro has strengthened versus the dollar over the past year. The question is - Can this trend continue, will it turn around and for how long?

So, while investing in Euros is not a win-win situation, it is a rather stable and consistent means of investing your money into a foreign market.

Pros of Investing Money

Last night I was watching TV and came across a television show about investing. One of the callers wanted to know why they should even bother investing during an unstable time like that we which are currently facing. Then they asked what are the pros of investing in the first place. And while I understood why they would ask the first question, I could not believe that they asked the second question.

So, what are the pros of investing your hard earned money? Two words: compounding interest.

Some people go to magic shows to be amazed, I take a look at investing calculators. There is no better way to convince a person that investing is a brilliant idea than by showing them how compounding interest works.

For example, if you make an initial deposit of $1,000 into a standard savings account that yields 0.2 percent (the current rate at Wells Fargo) and invest $500 every month for 30 years you will end up accumulating approximately $186,000. Not to shabby, right?

However, should you invest the same amounts for the same time at an average rate of return of 8 percent, your $1,000 will be worth nearly $757,000! That is almost four times as much and that is the beauty of compounding interest.

Still not convinced about the pros of investing?

Fine, allow me to provide additional arguments.

Investing is a brilliant idea because saving money for the proverbial rainy day will not just make you rich; it will also make you an intelligent and responsible individual. What happens if your car breaks down and you do not have any money in the bank? You put the costly repair on your credit card. Compounding interest works with debt too, and I am not sure you want me to put those numbers in front of you. But if you want to find out how credit card abuse can kick your financial butt, visit any compounding interest calculator online to see.

And what about your child’s education? If you are planning on having children and you expect those children to go to college, you need to ask yourself who is going to foot the bill. You are? How are you going to do that? Hiding money under your mattress probably won’t send your kids to college. On the other hand, setting up a college fund and investing in securities that have high rates of annual returns will allow you to send your child to whatever college they can get in to.

I could go on, but I think you know the most important investing pros by this point. And if this article failed to convince you of why you should be investing your money, well, there probably isn’t any hope for you.

Good luck.

Stock Investing Basics

So, you just landed your first “real” job and are ready to start investing. Or maybe you came into some money and want to make sure you do the right thing with it, but you do not know how to do it. Well do not despair, this article will show you the ins and outs on the basics of investing.

First and foremost, congratulations. Making the decision to start investing your money is one of the wisest decisions you will ever make. And while you might initially feel the pinch of a tighter budget, after a while, you’ll hardly even miss the money that you are socking away.

Perhaps the biggest question facing new investors is “how should they invest?” This fundamental question is also one of the most basic, and the answer is as open as the question.

When considering the basics, ask yourself the following question: do I have time to diligently research and manage my investments or would I rather have someone do it for me? Most folks will say they want to do the research and management themselves. However, they will soon realize that investing involves more work than they are capable of handling. Investment professionals exist to help you manage the world of investing. If you do not have the time or patience to actively manage your portfolio, hire a professional.

If you do want to conquer the investing world by yourself then you need to identify your investment objectives and base your investment decisions on that objective. Are you an aggressive or conservative investor? Do you plan on frequently entering and exiting the market or do you plan on buying and holding? What is your timeframe? Such basic questions must be truthfully answered before investing in a single security.

So, what should you invest in? That answer depends largely on how you answered the basic questions asked above. If you have the time to do your research and plan on being very active in managing your investments, you should consider investing in individual stocks. If you want to manage your portfolio, but don’t want to spend as much time doing research, you should look at mutual funds, ETFs and index funds. Lastly, you will want to consider investing in bonds and cash instruments such as money market funds.

The thing to remember when it comes to all types of security investing is that properly balanced asset allocation is key. You do not want all your money tied up in one stock or mutual fund. Instead your goal should be to create a well-balanced portfolio consisting of large-cap, small-cap and international stocks with a percentage of your portfolio invested in bonds and cash. This asset allocation percentage is determined by your investing style (aggressive, conservative, etc. and your time horizon). If you have many years before retirement, you will want to have the bulk of your portfolio made up of stocks. If you are close to retirement, you will want more stable and conservative investments in your portfolio (bonds, money markets, precious metals).

Investing in stocks is a great way to build your retirement nest egg. If you properly educate yourself on the basics, you will find the experience to be lucrative and positive.

An Investment Primer

If you are new to the world of stock investing, now is a great time to familiarize yourself with the basic fundamentals of investing in stocks. Whether you are new to investing or simply want to learn about stock investing, this article should provide you with a brief tutorial on the subject of stock investing.

So what is a stock?

Simply put, a stock represents partial ownership in a company. For the investor, one stock equals one share in the company. Some companies have millions of shares outstanding, or issued, while other, smaller companies might only issue a few shares of stock.

Stocks are securities that are purchased and sold at any one of the world’s financial markets. Americans are familiar with the NYSE or New York Stock Exchange and the NASDAQ or National Association of Securities Dealers Automated Quotient. The NYSE is commonly referred to as the “Big Board” and is the largest stock exchange in the world. Stocks are also exchanged at the Nikkei in Japan and the London Stock Exchange in England.

For many new to investing in stocks, the decision to begin investing can be fraught with danger. Many financial and investment advisors do not advise those new to stock investing to invest in individual stocks. Why? Because for the casual investor, investing in individual stocks takes more knowledge and time than they possess.

If you are an investing rookie, you should more than likely consider getting your feet wet by investing in index or mutual funds. Doing so will allow you the time to get comfortable with the principles of investing. Another thing you may want to consider is becoming a member of a web site that allows you to place mock trades and open a “training portfolio.” Tools such as that are very good ways to learn how to make trades, conduct stock research and track your progress. Best of all, you do so at absolutely zero risk!

Investing in the stock market is a great way to build up your retirement nest egg. Over the course of time the stock market has outpaced other investment options by a substantial margin. However, you should know that investing in the stock market carries risk. Many people fail to stick to their investing strategy and let their emotions make their decisions. If you have an extended time horizon until you retire, you will want to be more aggressive because you have the time to ride out the market’s lows. If you are near retirement, well, you probably aren’t reading this article.

The most important thing is to remember that when investing in stocks, research is key. Don’t waste your hard money chasing hot tips and emotions. If you think big picture and subscribe to the buy and hold philosophy, you’ll find your stock investing experience a good one.

Global Investing and How You Can Get Involved

Let’s talk green. And I’m not talking about the environmental movement, I am talking about the green in you wallet, or perhaps lack there of. Looking to start investing but nervous to take that first step, me and CNN.com are going to give you a little heads up. What could it be? Try the top global investing companies in the world! So, grab a drink, lean back and read on as we do the grunt work in global investing for you.

1) Apple®

Yeah, you have heard of them, I have heard of them, heck, I am writing on a Mac right now and listening to my iPod. If Apple is going to take over the world, at least we are all going to look super cool with our white and black electronics and super tiny players. What makes them so great? Try their innovation in the computer technologies market. Their people management skills and quality of products and services make them desirable candidates for global investing. They are a financially sound company and socially responsible. So, as far as Global investing goes, this American-based company stands tall.

2) Hewlett -Packard®

Another American based company, Hewlett-Packard is ranked number three in a list of highly desirable computer companies to invest in. They are innovative, know how to keep up with trends and have been financially sounds for quite a while now. Global investing opportunities knock with Hewlett-Packard on the front.

3) Canon&reg

Headquartered in Japan, this fun little company is a household name when it comes to personal electronics. Personally, I have a Canon camera and love it! With long term stability and great customer service, Canon is ranked one of the top global investment companies in the computer industry.

4) Lenovo Group

This Hong Kong-based company is cranking out personal computers like it’s nobody’s business. With tiny think pads and a great business plan, the Lenovo Group is marching upwards, quickly in the global investing market. Sometimes, its better to jump before the oven is heating up, that way you can stay along for the ride.

5) Nestle

Based out of Switzerland, who doesn’t know about and love Nestle? They do just about everything tasty, and so much more. Global investing opportunity here? I think so! They are ranked No. 1 globally for consumer food products offering you, the investor, everything from long term financial stability, customer service, innovation, social responsibility and much more.

So, there you go, five great companies that can help make you some green. Still not convinced? Go online and research a little yourself! You will find the world of global investing is much bigger and much more stable than you previously thought. Good luck, and get your green on!

The Beginners Guide to Investing

New to investing? Don’t sweat it! To many, investing can seem very complicated, but it doesn’t need to be. Here is a beginners guide to investing that will take you one step at a time through the process of determining your investing budget and then ultimately, deciding what to buy. Don’t let your money just lie around; you work for it so have it work for you!

To start with, come up with an investment strategy. Since this is a beginners guide to investing, understand that your invest strategy will depend partly on how much money you want to invest. Starting with $50 a month or more may not seem like a lot at first, but regular investments (even small ones) in mutual funds or exchange-traded funds can add up and mean big money. If you are interested in starting with a bit more, investing anything up to $10,000 will give you more investment options. Just make sure all your eggs don’t end up in one basket. Choose five or six different types of mutual funds to invest in. If U.S. stocks aren’t doing great, your holdings in international stocks or real estate may help keep your overall portfolio afloat.

For this beginners guide to investing, let’s talk about building a portfolio. A good idea is to choose five different mutual funds to will cover all your investing bases. This is a good tactic because by investing in different size companies, various sectors of the economy, and other parts of the world, you will reduce the chance that problems in any one area will sink all your investing goals. When looking at different mutual funds, look for strong, consistent performance, low fees and a stable, investor-friendly management company standing behind the fund.

Let’s be honest, the Internet can’t tell you everything. This beginners guide to investing recommends an active approach to investing. Instead of trying to do it all yourself, find an expert to help you along the way! It never hurts to stop and ask for directions. Stock experts like Timothy Middleton or Jim Jubak write columns and give their opinions on good and bad investments and the prospective market.

So, you have done some research and gone through this beginners guide to investing, what’s the next step to take? How about opening an account! There are different account types for different goals. To start with, there is the 401(k). Many employers offer a 401(k) or similar plan, this is a great way to invest so take full advantage of this at work. Next, an IRA plan. Any money in here will grow tax-free until your retirement! Start a 529 plan to save for your kids’ college expenses. Or set up a brokerage account. A brokerage account will help you start investing for goals that are more than five years in the future. Whether a vacation fund, house plans, school or a new boat, you can use a brokerage account to get there.

This beginners guide to investing is by no means completely comprehensive, get out there and read as much as you can, see where the investing market can take you!

Get to Know: Mutual Funds

Does the idea of investing make you nervous? I do not blame you if it does. I know it made me nervous. The idea of losing my hard-earned money did not sound too fun. But then someone told me that just putting money in a savings account was almost as bad as hiding it under my mattress. They advised that I should invest my money into a mutual fund. But before I jumped into the world of investing, I decided I needed to learn a whole lot more about mutual funds.

I had always wanted to invest, but I knew I did not have the knowledge or discipline to invest in individual stocks. And based on much of the research I did, many of the experts said that unless I really knew what I was doing, to invest in an individual stock would be foolish. To them, a mutual fund is the only way a casual investor should go.

Unlike individual stocks, mutual funds invest are investment vehicles that are composed of many different stocks. A mutual fund manager will choose the stocks that make up the mutual fund’s portfolio based on the strategy or philosophy they feel the mutual fund should adhere to. For example, a small-cap growth mutual fund will be made up of stocks of companies that have market values (or capitalizations) below $1 billion. Typically, investors seeking more aggressive mutual funds favor small-cap funds. The idea being that the potential rewards exceeds the high risks.

When you are conducting your mutual fund research- it is important that you know what your investment objectives are. If you are young, you can be more aggressive in your investing because you have time to recoup any losses you could incur. At the same time, if you are closer to retirement, you should seek out mutual funds that are more conservative in nature. Typically, aggressive mutual funds will invest entirely in high-growth stocks, while conservative funds will invest in a balance of stocks, cash and bonds. The growth for conservative funds is not nearly as high, but typically neither are the losses.

So, what type of mutual fund should you invest in? Many financial advisors recommend having the balance of your portfolio divided between large-cap, small-cap and international mutual funds. How you balance your portfolio will depend on your investment objectives. But if you do not want to deal with the hassle or responsibility of balancing your mutual fund portfolio, you may want to look at investing in a targeted mutual fund. These funds are based on specific targeted retirement dates and automatically adjust as your retirement date approaches. For example, if you are not retiring until 2045, the mutual fund will be very aggressive. However, as your retirement date nears the fund will shift its allocation towards more conservative securities such as money market funds and bonds.

By investing in mutual funds you can eliminate much of the hassle that comes with investing. More importantly, you will be setting yourself up for the retirement you always dreamed of.

Beginner’s Investing Made Even Easier

Sometimes I can’t believe I haven’t started investing some money. I’m scared. I’ll admit it. It just seems so complicated, and as many times as my friends and family tell me that it isn’t such a big deal, I continue to put it off. But the time has come, I finally have enough money to invest so I am going to go for it. First, though, I need information on beginner’s investing. So I did a little research and found some answers on MSN.com.

How much should I invest?

Investment strategies depend on how much money you want to put to work. So here are a few options:

Invest at least $50 with no lump sum. It may not seem like a lot of money, but for beginner’s investing, that’s a good thing! Even small regular investments in mutual funds or exchange-traded funds can add up.

Can you invest a lump sum of less than $10,000? If you can then you have more options. Many mutual funds have minimum-investment requirements of $500 to $2,500. The key is to make sure all your eggs don’t end up in one basket. Invest in five or six different types of mutual funds. If U.S. stocks aren’t doing great, your holdings in international stocks or real estate may help keep your overall portfolio afloat.

Do you have all kinds of money that you don’t know what to do with? If you have a sum of $10,000 or more, you definitely need to put that to work! The trick here is to not jump into the market all at once, potentially putting all your money in just before stock prices tumble. One approach: Put one-twelfth of your money into the market each month for a year, a technique known as dollar-cost averaging.

Building a portfolio should be part of the beginner’s investing strategy.

Cover all your bases, and choose five diverse mutual funds. If you choose differently sized companies from various economies and parts of the world, you reduce the risk that troubles in any particular area will sink your overall investing goals.

The main criteria for a beginner’s investing portfolio are strong, consistent performance, low fees, and a stable, investor-friendly management company standing behind the fund. Also, you can take a look at large-company stocks, small-company stocks, international stocks, bonds and real estate.

It is also helpful for a beginner’s investing plan to note that most discount and/or online brokers offer access to funds from a broad range of fund families, even if these funds are from different companies.

Beginner’s investing can be very scary, I know this for a fact. But don’t sell yourself short! Your money can work for you without you running a great risk. Try some of these ideas and you’ll likely be on your way to a more prosperous future.