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What was the Worst Day for the Markets?

The worst day for the markets, in terms of the largest single-day point loss by the Dow Jones Industrial Average, was September 29th, 2008. It happened when the Dow lost 777.68 points in response to the House’s rejection of the proposed bank bailout plan. On October 19th, 1987, however, the Dow dropped 22.61% (508 points) in response to a global domino effect of crashing markets. This is the largest single-day percentage drop to date. Continue reading...

What is the S&P 500?

What is the S&P 500?

The S&P 500 (also known as the Standard & Poor's 500) is an index of the 500 largest and most important U.S. companies (selected by a special committee). The S&P 500 is a cap-weighted index, meaning the respective weights of companies in the index depends on market capitalization. For example, since Apple Inc. and Google are the biggest companies in the U.S., they affect movements in the S&P 500 more than a smaller company, like Visa. Continue reading...

Whats is Commercial Paper?

Commercial Paper is an unsecured short-term loan that a highly rated corporation can issue to finance short-term obligations, like accounts receivable or inventory builds. The high quality paper is typically issued in increments of $100,000 and with a duration of no more than 270 days, which actually makes it a safe investment since the solvency/cash flow of a business is predictable over such a short stretch. Continue reading...

What is Monetary Policy?

Monetary policy is the stance of the central bank at any given time regarding the tightening or loosening of rates, or the issuance of new currency denominations, that will affect the money supply in the country. Monetary policy is the prerogative of the central bank but may be influenced by congress as well as private banking institutions and the central banks of other countries. The goal of monetary policy is to keep the Federal Funds Rate or the LIBOR, or whatever it might be depending on the country, at just the right level to keep the economy going in the direction that will be most helpful. Continue reading...

What is adaptive price zone?

What is adaptive price zone?

Adaptive Price Zone is a volatility-based trading indicator. Similar to traditional Bollinger Bands, Adaptive Price Zone is a recent development by Lee Leibfarth that overlays two indicator bands around a moving average line. It is more adaptive than many previous band indicators, using several short-term exponential moving averages which are double-smoothed and closely hug changes in volatility and price data. Exponential moving averages give more weight to recent data, which helps the lines hug current data. Continue reading...

What is Earnings Before Interest, Taxes ,and Depreciation (EBITD)?

Earnings Before Interest, Taxes, and Depreciation (EBITD) is one method of viewing the earnings of a company with some of the typical expenses added back into it. It is not to be confused with its close cousin EBITDA, which also adds amortization back in. Amortization is essentially the same thing as depreciation, but amortization applies to intangibles such as debt principal amounts and intellectual property. Continue reading...

What is IRS Publication 544 on Sales and Other Dispositions of Assets?

IRS Link to Publication — Found Here This guide is a reference for the tax implications of sales, transfers, barters, exchanges, forfeits, repossession, condemnation and abandonment of property. Where gains or losses are manifested, the guide helps to differentiate between capital gains and ordinary gains, as well as how to figure and report the gains or losses. Often when people sell or dispose of property in various manners there is a question of what the tax implications are, how much of the transaction is taxable, and whether any amount of it can be applied toward tax deductions. This guide, Publication 544, will outline all of the necessary filing forms and reporting practices for almost any kind of sale or disposition of property. Continue reading...

What is a Life Income Fund?

What is a Life Income Fund?

Life Income Funds (LIFs) are available to Canadians who have left a job before retirement and who are entitled to a sum of money in their pension plan. LIFs offer some flexibility, more than some other alternatives, but the amount that can be withdrawn at a time is limited to a minimum and maximum. The former employee could choose to leave the funds in the pension plan, or to use one of the alternatives to LIFs, which include a Locked-In Retirement Account (LIRA), which is provincially-regulated, or a Locked-In Retirement Savings Plan (LRSP), which is federally regulated. LIRAs and LRSPs do not permit regular withdrawals, and are seen as savings vehicles rather than income vehicles. Continue reading...

What are the FinCEN Guidelines Surrounding Cryptocurrency?

What are the FinCEN Guidelines Surrounding Cryptocurrency?

FinCEN is an agency of the Treasury Department responsible for preventing financial crimes, and they have taken a few steps toward creative effective regulations for cryptocurrency transactions. FinCEN is the Financial Crimes Enforcement Network, an office of the Treasury Department, primarily concerned with money laundering and other forms of financial fraud domestically and internationally. It is because of FinCEN’s far=reaching authority that major cryptocurrency exchanges who do business with US citizens will generally require identity and bank account verification, and will impose limits on transaction amounts. In 2013, FinCEN issued guidance that anyone engaged in the transmission or exchange of cryptocurrencies may fall under their jurisdiction to regulate Money Service Businesses (MSBs), meaning you may potentially have to register as a Money Transmitter on the Federal and state level if you frequently engage in cryptocurrency transactions. Continue reading...

What is the Symmetrical Triangle Bottom (Bullish) Pattern?

The Symmetrical Triangle Bottom pattern forms when the price of a pair fails to retest a high or a low and ultimately forms two narrowing trend lines. As the support and resistance levels consolidate, it forms a triangle (1­5). Symmetrical Triangles are characterized by the upper line sloping downward and lower line sloping upward. The price movement inside the triangle should fill the shape with some uniformity, without leaving large blank areas. Continue reading...