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Table of Contents
Help Center
Introduction
Investment Portfolios
Investment Terminology and Instruments
Technical Analysis and Trading
Cryptocurrencies and Blockchain
Retirement
Retirement Accounts
Personal Finance
Corporate Basics
How do I determine the right mix of assets?

How do I determine the right mix of assets?

Asset allocation tools and Monte Carlo simulators are available through broker-dealers and online services. You may wish to construct your own asset allocation, but there are asset allocation programs available which can take a lot of the uncertainty out of the process. The most famous method for analyzing and testing an allocation involves the so-called Monte Carlo simulation. This simulator helps you determine what would have happened with your portfolio if you were invested according to a particular mix of assets. Three main parameters you should consider for each asset class are: the asset’s historical performance, its volatility, and its correlation to other asset classes. Continue reading...

Who are venture capitalists?

Who are venture capitalists?

Venture capitalists may have been entrepreneurs themselves who are now helping newer companies achieve success in return for large equity positions in the business. They may also work for investment banks. They form firms which manage a portfolio of venture capital investments. Venture capitalists are firms whose business model is to infuse money into companies which do not have access to the capital markets, or do not want to turn to the open market, in return for equity in the business. Continue reading...

What are My 401(k) Investment Options?

What are My 401(k) Investment Options?

401(k)s can offer many options for investment, but they generally only offer 15 or fewer in each plan. Investment options in your 401(k) are completely determined by the agreement between your employer and the custodian. Therefore, you’re limited to the investment instruments selected for you. The majority of 401(k) plans will offer fewer than 15 investment options, which are generally part of prepackaged 401(k) products from major broker-dealers or mutual fund companies. Large companies will frequently also offer stock of their company within the 401(k) plan architecture. Continue reading...

When Do I Have to Withdraw Money from My Roth IRA?

Roth IRAs are not subject to RMDs, which means you aren’t forced to make withdrawals. In most retirement accounts, Required Minimum Distributions will be mandatory once the account holder turns 70 ½ years old. This does not apply to Roth IRAs. They are basically the only tax-advantaged retirement account that does not have to take RMDs. This is partially because the IRS wants to make sure they get some of the taxes out of the money that was invested on a pretax basis. Continue reading...

What Amount of Life Insurance Should I Have?

What Amount of Life Insurance Should I Have?

You may hear different things about the amount of life insurance that you need. An easy way some suggest is to take your annual income and multiply it by 10. But that doesn’t take everything into account, such as debts, specific things you want the money to do, or a safe withdrawal rate to give your beneficiaries an income that you want them to have if something happens to you. The right number could be more like 20 times your annual income, but it all depends on the purpose of the money and your financial situation. Continue reading...

What is Sharpe Ratio?

What is Sharpe Ratio?

The Sharpe Ratio is a risk-weighted metric for returns on investment. It measures whether an investment offers a good return for the amount of risk assumed by the investor. The risk/return trade-off is a positive linear relationship in most theoretical depictions – if an investor seeks greater returns, they will have to take on greater risk. For more stability and less risk, an investor will have to sacrifice some potential returns. Continue reading...

What is Profit and Loss (P&L) Statement?

A Profit and Loss Statement, also referred to as an “income statement,” is a corporate statement that summarizes the revenues, costs and expenses incurred by a company during a specific time period, such as a quarter or a fiscal year. The main difference between a P&L statement and a balance sheet is that the P&L is designed to show changes in line items over the period analyzed, versus a balance sheet which simply shows a comprehensive snapshot of a company’s asset and liabilities on a set date. Continue reading...

What is Cost of Debt?

The cost of debt is a calculation that determines the actual cost of a company’s debt financing. Since interest payments are generally tax deductible, the cost of debt may not be as simple as just adding up all of the interest paid on a loan. It would have to be adjusted for the tax savings, such that it is total interest paid less the tax savings. Continue reading...

What is Form 706 GS (D): Generation Skipping Transfer Tax Return for Distributions?

IRS Link to Form — Found Here Form 706 is the Estate Tax return, and it has a section concerning Generation-Skipping Transfers. 706 GS (D), specifically, is the form which 706: GS (D-1) is the corresponding form if the transfer is associated with a trust, which is filed by the trustee. The Generation-Skipping Tax attempts to prevent an estate from transferring too many assets directly to grandchildren instead of children for the purpose of shielding heirs from estate taxes. The form for reporting Generation Skipping Transfers is 706 GS (D), where 706 is the Estate Tax Return filing. Continue reading...

What is the Descending Triangle (Bearish) Pattern?

What is the Descending Triangle (Bearish) Pattern?

The Descending Triangle pattern has a horizontal bottom (1, 3, 5) which represents the support level, and a down­-sloping top line (2, 4). The breakout can be either up or down and the direction of the breakout determines which corresponding price level is the target. This pattern is commonly associated with directionless markets since the contraction (narrowing) of the market range signals that neither bulls nor bears are in control. When the price of a security consolidates in a somewhat volatile fashion, it may indicate growing investor concern that the price is set to break out. Continue reading...