Can I Leave My 401(k) With My Former Employer?
Generally a plan will allow you to leave your assets in there indefinitely, but this is probably not ideal for you. Most custodians will be happy to hold onto your account dollars as long as you’re willing to leave them there. They don’t have to spend any time servicing your account since you can’t make contributions and probably aren’t even able to reallocate your assets, and they will continue to make money on your account with the built-in fees. You may be charged inactive account fees or small account fees as well. Continue reading...
Will My Cash-Balance Payments Affect My Social Security payments?
Social security can become taxable if a person has a certain level of income in retirement. Retirement income from pensions or 401(k)s and other taxable sources will contribute to the AGI of a person in retirement, but it will not ever disqualify a person from receiving their social security check in retirement if it is owed to them. Instead, social security benefits become taxable as income if a person has enough income in retirement to trigger the social security taxes. The level is actually quite low, and has not been adjusted for inflation recently. Continue reading...
What is Ripple?
Ripple is a protocol for cryptocurrency transactions primarily focused on offering solutions to the financial sector for implementing blockchain technology. Banks and other financial institutions have been experimenting with ways to implement blockchain technology for years. Many of these have gravitated toward Ethereum, with its platform distributed applications and smart contracts, but the San Francisco-based startup Ripple has been gaining traction in this space recently. Continue reading...
What is a support line?
A support line represents an estimation of where a price is likely to stop moving downwards, based on recent data and analysis methods. It is arrived at with different formulas for different indicator methods, but it is generally a line derived from moving averages and standard deviation which represents a lower level at which traders would expect a price to rebound back upwards. Several methods of technical and fundamental analysis plot a support line or two as part of a graphical representation of trends. Theoretically, a price will only deviate so far from its moving average before bouncing back toward the middle. Continue reading...
What is Cash Flow?
Cash flow is the liquid flow of cash and cash equivalents into and out of a business. Cash flow is an accounting metric that keeps track of the liquid assets going into and out of a business, project, or fund. Cash flow does not include accounts receivable, necessarily, because those funds may not be in-hand at the present time. The cash conversion cycle (CCC) and some valuation calculations will use cash flow numbers. Accounts may demonstrate positive or negative cash flow, which is either adding to or decreasing total assets. Continue reading...
What are Fibonacci Numbers/Lines?
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 a Long Position?
A long position - or to be “long a stock” - means that an investor has share ownership and will receive an economic benefit if the share price rises, and vice versa. Creating and maintaining a long position is simple: an investor just buys and owns the investment. A “long-only” strategy refers to an asset manager that only buys and sells securities in the portfolio as a management strategy - they will not use options or shorting strategies as a result. Continue reading...
What are Financials Stocks?
Financial stocks are those that make up the financial sector, which encompasses banks, lenders, wire houses, and other companies that facilitate the flow of capital and debt. Real estate companies can also fall under this category. Financials tend to do well when yield curves are steep and the regulatory environment favors banks. When credit markets aren’t under strain financials tend to perform well. Continue reading...
What is buying power?
With regards to Margin Trading, ‘Buying Power’ is a term used to describe how much additional leverage you have given the excess equity in your account. When your broker or custodian authorizes buying on margin, the purchasing power of your assets can become substantial. Instead of just owning $10,000 worth of stock, you might be able to leverage that to buy $10,000 more, therefore having $20,000 of long exposure even though you only have $10,000. Continue reading...
Where do I find a good CPA?
A good CPA can be a valuable ally. You should find one who works with clients similar to you and who is easy to talk to. Taxes and accounting are a part of nearly every financial instrument and consideration that people will be confronted with in their life. It can be very beneficial to work with a CPA who can advise you properly on the issues that affect you. It can also be detrimental to place too much trust in a CPA who isn’t really an expert in the areas he claims to be. Continue reading...