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What is a Fixed Annuity?

What is a Fixed Annuity?

Fixed annuities, generally speaking, are annuity products that give the purchaser of the annuity the guarantee of fixed income payments for life. Annuities must come with the option to be paid out in equal payments either over a certain number of years or the lifetime(s) of the annuitant(s). This is the case for variable and fixed annuities, and these payments will be fixed and guaranteed. Where they differ is how they are invested before any annuitization takes place. Continue reading...

How volatile are commodities?

How volatile are commodities?

Commodities are more volatile than most assets. The supply-demand dynamics of commodities are continuously changing, and sometimes very rapidly. Different commodities will have different levels of volatility, of course. Some commodities are extremely volatile. For example, natural gas has had a volatility of almost 45% in some periods, and gold has experienced movements of 20-30% per year lately. Crude oil prices fell some 50% in 2015, as a global supply glut was met with weakening demand, particularly from China. Gold is actually on the less-volatile side of the spectrum for commodities. Silver, Nickel, and crude oil tend to be on the upper end of the spectrum along with exotic metals such as platinum and palladium. Continue reading...

What are the Contribution Limits for a Roth IRA?

If you are eligible to make Roth IRA contributions, you can fund an account for yourself and a non-working spouse, up to the contribution limits. As of 2016, if you are under 50 years old, you are allowed to contribute $5,500 a year to your Roth IRA. If you have a spouse, even if he or she does not work, you can make contributions into an account for him or her, up to the full limit. For two people, that means $11,000 a year can be set aside each year. Continue reading...

What is the DAX?

The DAX is an index tracking performance of German stocks. The DAX is an index that tracks the 30 largest capitalization stocks that trade on the Frankfurt Stock Exchange in Germany. The index is capitalization weighted, but since it is so narrow it is more comparable to the Dow Jones than the S&P 500. It does not necessarily give a thorough indication of how the German economy is performing. What is the CAC 40 Index? What is the EURO STOXX 50? Continue reading...

What is a Profit?

What is a Profit?

In its simplest form, a profit is the revenue or income gained from an entity after all expenses/overhead is accounted for. In business, a company deals with a number of expenses - operating expenses (the cost of doing business), fixed costs (overhead), salaries and benefits, legal fees, and so on. If a company’s revenues exceed all of these costs combined, the company is considered profitable. A profit is also known as a company’s bottom line, net earnings, or net profit. 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 the Debt to Capital Ratio?

The debt-to-capital ratio is a measure of a company’s leverage that looks at total debt compared to total capital (shareholder equity + debt). This measure of leverage is not a globally accepted accounting practice, therefore it is important for analysts to learn exactly what is being included by the company as their debt and equity in calculating the ratio. Generally speaking, a higher debt to capital ratio indicates that the company is financing more of its operations and needs through the debt markets versus with equity. Comparing debt-to-capital ratios amongst companies within the same sector or industry can be a useful exercise. Continue reading...

What is Accounts Receivable Financing?

Financing companies can step in and take over the accounts receivables of a company who no longer wants to wait to be paid on their receivables. Financing companies, who are sometimes called Factoring Companies or Factors, will pay about 75% of the amount due to companies who want to offload or outsource their Receivables. The factoring company will then take over the task of collections, and will transfer most of the money received back to the original company, after their fees have been deducted from the proceeds. Continue reading...

What are Lifetime Reserve Days?

Lifetime Reserve Days are part of the structure of Medicare Part A benefits. Medicare will cover up to 90 days in a hospital or skilled nursing facility per event, and each event is called a benefit period. After the benefit period has been used up, the client will then dip into a pool of lifetime reserve days if the insured requires additional inpatient care. There are only 60 additional days in the Reserve pool, and a person cannot reuse them. Continue reading...

What is the Triple Bottom (Bullish) Pattern?

The Triple Bottom pattern appears when there are three distinct low points (1, 3, 5) that represent a consistent support level. The pair tests the support level over time but eventually breaks resistance and makes a strong move to the upside. This type of formation happens when sellers can not break the support price, and market participants eventually pour in. Once the price breaks out from the top pattern boundary, day traders and swing traders should trade with an UP trend. Consider buying a pair or a call option at the breakout price level. To identify an exit, compute the target price by adding the pattern’s height (highest price minus the bottom price support level) to the breakout level ­ the highest high. When trading, wait for the confirmation move, which is when the price rises above the breakout level. Continue reading...