How Does My Retirement Age Impact My Social Security Benefits?
Social Security benefits are calculated using the Normal Retirement Age (NRA), which is 67 for people born after 1960. If you take benefits early, your payment will be reduced by as much as 30% if taken at age 62. After NRA, your benefit will be increased by 8% for every year you defer benefits. You cannot defer taking Social Security past age 70. As a rule of thumb, the closer to age 70 you retire, the higher your Social Security benefits will be. Of course, there are some specific guidelines. Everyone has an NRA (Normal Retirement Age), which determines the age at which you can receive your full Social Security benefits. Continue reading...
How Do You Calculate Mining Profitability?
Mining for cryptocurrency may or may not be profitable for you, but the good news is that you can easily run the numbers. Mining profitability is will primarily depend on the hashrate (mining speed) of your mining hardware, and the amount of energy it takes to run the hardware. Mining software usually comes with system monitors that will tell you with a fair degree of accuracy what the numbers are, and several online calculators exist to help as well. The cost of energy is the main concern, many miners will seek to be near the cheapest sources of energy, such as a hydroelectric plant in Sweden or countries with energy subsidies such as China. Continue reading...
What is a Merkle Tree?
A Merkle Tree is a technique widely used to create the blocks in blockchains. When records of numerous transactions are blended together into a block and sent to a blockchain to be deciphered and validated, Merkle Trees are generally the design with which they are put together. Ralph Merkle first designed this hashing method in 1979 but didn’t see it popularized for some time. They are sometimes called hash trees. In case you are unaware, the difference between hashes and encryptions is that hashes are not intended to be decryptable unless someone has the original content. Hashes are basically symbols of a certain length generated using the “seed” of the actual content that was fed into the hash function. If the same content is entered as the seed, it will produce the same hash, but any differences will yield a completely different result. Continue reading...
What is Adjusted EBITDA?
Basically synonymous with Normalized EBITDA, Adjusted EBITDA is a non-GAAP method of making earnings valuations a little more standardized between companies. Adjusted Earnings is a valuation that has many moving parts in the form of the interest, taxes, depreciation and amortization that might be included there, in addition to the non-GAAP nature of the methods. EBITDA removes all of those moving parts and looks at the Earnings before any of the other arithmetic interferes, hence the name Earnings Before Interest, Taxes, Depreciation, and Amortization. Continue reading...
What is the Federal Unemployment Tax Act (FUTA)?
The Federal Unemployment Tax Act was passed in 1939, and it set up trust funds for the purpose of providing unemployment insurance. Businesses, not individuals, are taxed to provide funds for the program. There are 53 state funds (including D.C., Puerto Rico, and the Virgin Islands), 4 federal accounts, and 2 associated with railroad retirement. The Federal Unemployment Tax helps states fund their own unemployment programs. Continue reading...
What is the foreign earned income exclusion?
Americans working abroad must report their earnings to the IRS, but they are allowed to avoid paying federal income taxes on an amount adjusted for inflation, which is just over $100,000 as of 2016. Americans working abroad often enjoy a few tax advantages. One of which is the Foreign Earned Income Exclusion. The reasoning is that they are probably paying some form of tax in the county in which they are working, even though this is sometimes not the case. Continue reading...
What is foreign exchange risk?
Foreign Exchange Risk is the possibility that exchange rates will move against you when you have pending payment on transactions in another currency or other investment positions in foreign currencies or foreign assets which will be affected by Forex fluctuations. Foreign Exchange Risk can also be called Forex risk, and it is the potential loss to an investor or institution when doing business in a foreign currency if the exchange rate swings unfavorably. Companies and countries take various measures to hedge against exchange rate risk, including holding reserves of other currencies and buying derivative contracts on various currency pairs. Continue reading...
What are Fibonacci Retracements?
Fibonacci Retracements are places where a Fibonacci lines and arcs. If a retracement has a length that proportionally fits within certain parameters in comparison to the uptrend that preceded it, some traders attempt to predict the size of the uptrend that will come afterwards using Fibonacci numbers. The most popular retracement percentages to use are 23.6%, 38.2%, 50%, 61.8%, and 100%. Fibonacci numbers are part of the Fibonacci sequence, where the two previous numbers are added together to calculate the next number in the sequence. The ratio of two Fibonacci numbers is the Golden Ratio, or 1.61803398875, which has been used since ancient times as the perfect proportion in architecture and other design. The Golden Ratio is also known as Phi (pronounced “fee”). Because Fibonacci numbers are found throughout the natural world, they have been integrated into some traders’ strategies for market analysis. Continue reading...
What is the Black-Scholes formula?
The Black-Scholes formula is a formula and market model for explaining or determining the price of European-style options. It was developed in 1973 by two world-renowned economists, Fischer Black and Myron Scholes, and it led to a Nobel Prize in 1997. As opposed to the American-style of options, which can be exercised at any time, European-style options can only be exercised on their expiration date, they are not exposed to dividends, and they have no commission structure to consider. Some are content to use Black-Scholes for quick applications to American-style, but It is not as accurate as it should be. Continue reading...
What are futures contracts?
Futures contracts constitute a binding agreement to trade a commodity, share, or instrument at a future date at an agreed-upon price. They are auctioned on regulated futures exchanges. Futures contracts are used primarily to deal with agricultural assets and natural resources but have come into use for anything that can be commoditized, including financial instruments and technological resources. Continue reading...