Tag: investing

  • Investing

    Short Selling

    Short Selling, also known as Selling Short, refers to the common stock trading practice of selling an equity one doesn’t actually own, while intending to buy it back at some future date and - critically - at a lower price. The “short” refers to the trader owing the funds for payment of the equity to their broker, who must be repaid later when the investor succeeds in covering their position. ...

  • Investing

    Value Investing

    An Investor’s Best Strategy: Value InvestingValue Investing is seen by many as a form of “smart investing”, as it is in many ways the polar opposite of speculation and impulse buying (or selling). The reputation of value investing has been polished by its association with legendary investor Warren Buffett. Buffett, however, has refined the original concept of value investing from ...

  • Investing

    Day Trading

    Day Trading is a modern phenomenon that has received an inordinate amount of publicity. The popular picture of a day trader is an average person who buys and sells equities from their home or work computer, bypassing the traditional stock broker and stock exchange establishment. This image appeals to society’s natural backing of the underdog who beats the cigar smoking “backroom boys” at ...

  • Investing

    Penny Stocks

    Penny stocks are defined by no less an authority as the Securities Exchange Commission (SEC) as stocks issued by companies with low market capitalization, typically under $500 million. Penny stocks may trade at prices of more than $1 per share, but the SEC uses the share price to categorize them rather than their level of market capitalization. Although penny stocks are sometimes traded on ...

  • Investing

    Buying On Margin

    Buying on Margin, also known as Margin Buying, is the practice of buying shares or securities using money borrowed from a broker. The amount of the loan may be several times more than the investor’s own contribution- for example $20 from the investor and $80 from the broker to purchase a $100 share of stock. Since the purchased securities themselves are the collateral backing up the loan, ...

  • Management

    Mergers Acquisitions

    Are we blinded by the publicity blitz which hits the stock market whenever there is some Merger and Acquisition activity? When did you last see a Net Present Value comparison of acquisition versus an organic growth alternative? Could the objectives of acquisition have been met through a strategic partnership? Has an executive team or a promoter taken off on an ego trip with your money?

  • Management

    Retention

    Human Resources constitute a unique asset, because unlike money and physical units, you cannot turn it up at will, even with better prices! There is a widespread notion in some stock market circles that better pay can bring in top management talent in droves. Perhaps this used to be the case decades ago, but extended economic growth in all sizeable markets can changed the demand supply ...

  • Investing

    Futures

    Futures, in the financial sense of the word, are closely related to Options but with one crucial difference: while Options contracts give their purchaser the right to buy or sell a certain commodity or security by or at a certain date, a Futures contract imbues the trader with the obligation to settle the contract. In this respect, futures contracts entail a certain level of urgency that ...

  • Options

    Trading

    It may surprise you to learn that options trading is not a recent development in economics, but in fact has a very long history that goes back nearly to the very beginnings of human economic activity. These early options trades mainly dealt with real estate and the gradual accumulation of land, plot by plot. One more modern example of an “option” might be the decision of a major motion ...

  • Investing

    Investing 101

    It seems every day we’re bombarded with offers, enticements and pitches to get us to invest our money. It can become confusing, even disheartening after a while, especially for those just getting started in investing. One should remember that all of those companies who advertise investing strategies are businesses whose priority is to make money for them first and you, second. When it comes ...

  • Futures

    Settlements

    Futures differ from options in that options contracts provide the purchaser with the “option” of completing a transaction at a set price, while futures contracts oblige both parties to the transaction to settle the contract on the date of expiry. Naturally, this fact may cause people to wonder what they will do when a truckload of fresh pork bellies arrives at their front door, not to ...

  • Futures

    History

    Trading in futures may be tightly regulated these days, but such was not always the case. At several points in history, market forces combined with such human natures as hope, greed and panic, have inflated - and swiftly deflated so-called “bubbles”, with the deflation typically much more sudden than the extended build-up to the inevitable crash, or “burst” if we invoke the bubble metaphor.