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Introduction
Investment Portfolios
Investment Terminology and Instruments
Technical Analysis and Trading
Cryptocurrencies and Blockchain
Retirement
Retirement Accounts
Personal Finance
Corporate Basics

What are the Withdrawal Rules for My Money Purchase or Profit Sharing Plan?

The standard withdrawal rules for 401(k) accounts apply to these plans. Once you are age 59½, you may begin to make penalty-free withdrawals and only pay income taxes on the amount you withdraw. If you decide to take out money before age 59½, you will have to pay a 10% penalty fee in addition to income taxes on the amount of your withdrawal. Of course, there are exceptions that would allow you to avoid this early withdrawal fee. Continue reading...

What if I Want to Retire Abroad?

What if I Want to Retire Abroad?

Retiring abroad requires additional planning to account for visa requirements and currency exchange factors, but like any financial goal it can be reached with proper planning. Retiring in the U.S. is difficult on its own, given rapidly rising cost of health care and the fact that most Americans under-save. Retiring abroad, while possible, makes matters even more difficult. Amongst other factors to consider, a retiree needs to plan for a myriad of additional costs such as tax implications, currency fluctuations, visa requirements, and health care. Continue reading...

What is the Elliott Wave Theory?

What is the Elliott Wave Theory?

Elliot Wave Theory incorporates the natural cycles of nature and waves with market movements in an attempt to explain and predict the historical and future prices of stocks. Penned by Ralph Elliott in the early 20th century, the Elliott Wave Theory attempts to organize the seemingly random behavior of the market into cycles. The theory visualizes a series of waves cycles, each representing a different length of time or magnitude of a trend or cycle. Continue reading...

What does asset allocation mean?

What does asset allocation mean?

At the highest level, Asset Allocation refers to an investor’s decision of what percentage to allocate to stocks, versus bonds, versus cash (and cash equivalents), versus any other asset class (commodities, alternatives, real estate, etc…). It is believed that the asset allocation decision is responsible for the majority of an investor’s returns. In other words, there is a direct correlation between an investor’s long-term return and how long - and to what percent - they owned stocks over their lifetime. Continue reading...

What is Minimum Margin?

Minimum margin is the minimum amount needed to open a margin account. The custodian or broker typically sets the minimum margin, but it cannot be for any less than the $2,000 required by the NYSE and NASD. What is 'Buying on Margin' and Margin Trading? What is a Margin Account? Continue reading...

What is the Federal Funds Rate?

The federal funds rate is the overnight rate at which commercial lenders lend excess reserves to other institutions, on an un-collateralized basis. This term is unique to the United States, though other central banks around the world also have an overnight rate. The federal funds rate is a closely watched and crucial rate for determining how easy capital is to access. The lower the fed funds rate, the more accessible the Federal Reserve is trying to make cash - to inspire banks to borrow and lend. The opposite is also true, where the Fed may raise the fed funds rate if an economy is overheating or lending needs to be curbed. Continue reading...

What is a Rate Swap?

A rate swap is the exchange of cash flows on underlying principals which are not exchanged. It is an over-the-counter contract between two institutions to trade the cash flows on two comparable principal amounts, but not to exchange the actual principal amounts. Institutions might prefer this arrangement because they only have access to floating interest rates or are overweight in them and would prefer to have some fixed rate interest cash flow, or vice versa. These swaps might occur between banks on opposite sides of the world to take advantage of rates elsewhere or to simply diversify their risks. Continue reading...

What does “Buy the Dips” Mean?

“Buying the dips” is a bullish description of investing in stocks whose prices have gone down. We say this is a bullish sentiment because a bearish investor would be more likely to interpret the downturn as a sign of impending doom, or might prefer to play it safe. A “dip” can be loosely defined as a downtrend without much momentum or evidence to support a bearish outlook. Another way of interpreting a dip would be as an oversold condition, where investor sentiment has caused the price of a quality stock to fall. Bullish investors could maximize their gains in such a scenario by buying low and selling when the stock has recovered and pushed on to new highs. Technical analysis indicators such as Bollinger Bands can be used to identify favorable buying conditions. Continue reading...

Top Stock Chart Patterns

Top Stock Chart Patterns

Chart patterns are shapes that sometimes appear in the charts of securities prices. Some of them may prove useful to you. Some frequently discussed chart patterns include Head and Shoulders, Double/Triple Bottom/Top, Cups and Saucers, Flags and Pennants, and others. Generally, it can be useful to compare and connect the troughs to each other and the peaks to each other to see if there is a trend confirmation if the breadth is narrowing, or if a reversal might be imminent. Continue reading...

How to use the On-Balance Volume in trading

How to use the On-Balance Volume in trading

On-Balance Volume (OBV) is a popular leading indicator introduced in the 1960s by Joe Granville. OBV is a line built using differences between daily trading volume – in Granville’s estimation, the major driver of market behavior – adding the difference on days that the market or stock moves up and subtracting the difference on days when the market or stock moves down. It looks for instances of rising volume that should correlate with price movement, but price movement has not occurred; additionally, OBV can be used to confirm lag. Continue reading...