Stock Market / Investing
Investing for Retirement
Investing for Retirement
One of the biggest worries about retiring is the question of how to fund your living expenses for the duration of your retirement period. Most people do the basic thing which is to invest in a pension plan through their employer. If you don’t already have a workplace pension in place and are over a certain age and earn more than a set amount, then your employer may automatically enroll you for a workplace pension but investing for retirement deserves more planning and thought than that.
Advantages of Employer Sponsored Pension
The advantages of investing in an employer sponsored pension are numerous.
For one thing, your employer will contribute to it, and so will the government via tax deductions/credits for your contributions. In other words some of the income tax that you would have paid just goes right back into your pension fund instead of the government’s coffers. Plus this pension will always be yours, regardless of whether you leave your employer in the future. While doing this can help you cover your living expenses when you retire, the simple fact is that it may not be enough for everything that you want. Depending on your contribution level, an employer sponsored pension may be just enough to become a hand to mouth experience for every month. In old age, you would most likely prefer to live more comfortably than that so let’s look at some additional alternatives…
Form 1099B: Important Changes to Stock Reporting Requirements
Form 1099B
In 2008, Congress under then President George Bush enacted changes to the Federal requirements for cost basis tax reporting that required stockbrokers to report this information to customers and the IRS. This legislation laid out the timelines for reporting the cost basis for various instruments and securities purchased by investors.
When filing your tax returns, you will now get a new Form 1099B issued by your stockbroker. Let us briefly look at the changes and how it will affect you. This new legislation is being phased in and is effective as of:
- Equity securities transactions effective January 2011
- Sale of Mutual funds and dividend reinvestment plans effective January 2012
- Trading in options and fixed income securities effective January 2013 Read the rest of this entry »
What is a Moving Average?
Investing Using Moving Averages
When investing in financial markets, there are many different indicators and systems that you can use to determine when to enter into a position, and just as importantly, when to exit a position. One of the most popular indicators that investors employ to help make intelligent decisions are moving averages. What exactly is a moving average and how can you use it to invest in the financial markets?
What is a Moving Average?
Simply stated, a moving average is the average price of a stock over time.
To be a little more technical, a moving average is a statistical measurement (the mean) of a dynamic set of data (aka “rolling”) that helps to identify trends in the underlying instruments. A 13-week moving average provides the average price of the financial instrument using the stock prices for the preceding 13 weeks. A 50-week moving average uses data from the preceding 50 weeks, etc. Each new day, the oldest day’s data is removed from the population and the current day’s data is added; in this way the population is always equal to 13 weeks’ worth of data, measured from that day back.
The moving average is a linear measurement of the average price of a stock over the period in question. The line communicates the historic trend of a stock’s price. Most consumer trading platforms offer moving average indicator tools for use in technical analysis.
There are two different types of moving averages Read the rest of this entry »
Stock Market Fluctuations
The Manic-Depressive Stock Market: What to Make of It
The psychology of the market may be teetering on the edge
The stock market: one week it acts like Dr. Jekyll, the next week it’s Mr. Hyde.
That shift can even occur in the course of a single session.
These dramatic fluctuations appear to be impulsive; and we know that impulse does not flow from cold reason. Even so, the Efficient Market Hypothesis would have us believe that investors are constantly applying reason and logic to reach some objective market pricing, via the latest news or measure of stock market valuation.
The February 2010 Elliott Wave Theorist provides insight: Read the rest of this entry »
Has Wall Street Ever Warned You in Time?
Stock Market Turning Points: Has Wall Street Ever Warned You in Time?
Divorce yourself from the crowd. Independence is good.
In the play “The Secret to Freedom,” Pulitzer prize writer Archibald MacLeish had a character say this:
The only thing about a man that is a man is his mind. Everything else you can find in a pig or a horse.
MacLeish knew how to state the truth plainly.
And the truth is, you can use your mind in any way you wish.
When it comes to financial markets, most allow others to do their thinking for them. You’ve heard the phrase “the blind following the blind.” Yes, they both fall into the ditch. Read the rest of this entry »
Financial Planning Software
Financial Planning Software – Is It Beneficial for the Experienced Investor?
Financial planning software is being used by many experienced investors to track their investments and set proper investment targets and accomplish their goals. It can be used to formulate a well-planned budget and carry out a thorough examination of your investment portfolio and get a clear idea of your present financial situation. If you are one such experienced investor, then with the help of financial planning software, you will be able to get a quick handle on your financial condition. Read the rest of this entry »
Five Fatal Flaws of Trading
Close to ninety percent of all traders lose money. The remaining ten percent somehow manage to either break even or even turn a profit — and more importantly, do it consistently. How do they do that?
That’s an age-old question. While there is no magic formula, EWI Senior Instructor Jeffrey Kennedy has identified five fundamental flaws that, in his opinion, stop most traders from being consistently successful. We don’t claim to have found The Holy Grail of trading here, but sometimes a single idea can change a person’s life. Maybe you’ll find one in Jeffrey’s take on trading. We sincerely hope so.
The following is an excerpt from Jeffrey Kennedy’s Trader’s Classroom Collection, Volume 4. Learn how to get 14 more actionable trading lessons — FREE — below.
Why Do Traders Lose?
If you’ve been trading for a long time, you no doubt have felt that a monstrous, invisible hand sometimes reaches into your trading account and takes out money. It doesn’t seem to matter how many books you buy, how many seminars you attend or how many hours you spend analyzing price charts, you just can’t seem to prevent that invisible hand from depleting your trading account funds.
Which brings us to the question: Why do traders lose? Or maybe we should ask, “How do you stop the Hand?” Whether you are a seasoned professional or just thinking about opening your first trading account, the ability to stop the Hand is proportional to how well you understand and overcome the Five Fatal Flaws of trading. For each fatal flaw represents a finger on the invisible hand that wreaks havoc with your trading account. Read the rest of this entry »
Why Choose the Wave Principle?
Robert Prechter reveals why he embraced the Wave Principle.
Robert Prechter is the widely recognized authority on the Elliott Wave Principle.
Read how he learned about the Wave Principle and why he embraced it in the edited excerpt from his book Prechter’s Perspective below (Q&A format):
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Question: What was it about Elliott that captured your attention?
Robert Prechter: I had seen some mentions of the Wave Principle in a few market newsletters and a couple of obscure books, and I decided that either this was someone’s elaborate fantasy or it was an amazing discovery. I wanted to reject it from what evidence I could find or include it as part of my growing arsenal of technical analytical methods.
Q: How long did it take you to develop your “eye” for discerning these waves? Read the rest of this entry »