A term “mutual fund” has become so familiar that it is hard to imagine one’s investment portfolio without at least a single mutual fund in it. In short, a mutual fund is a form of collective investing where investors pool money into an investment fund managed by a fund manager. The fund manager then purchases securities in accordance with investment mandate and sells the fund shares to the general public. [Read more…] about Why ETFs Are Better Than Mutual Funds
A Roth IRA account is an account that provides not only tax-free growth of your hard-earned savings, but allows for anytime tax- and penalty-free distributions as well (only for contributions.) In addition, a Roth IRA gives you a much more flexibility over your funds and investment options, which can improve your overall performance and speed-up the accumulation process. For instance, you can construct your portfolio the way you want, not the way your 401k plan management company wants [Read more…] about Best Roth IRA Brokers
The current bull market that started in 2009 is the 3rd longest bull market in history. We’ve been in this state for 2,287 days (since March 6, 2009.) Moreover, during this period we haven’t seen a 10% correction for 968 days already (since August 4, 2011), which makes it the 5th longest period without a 10% correction. No wonder, many analysts and investors are getting nervous saying the market is overvalued and due for a pullback. [Read more…] about Seven Ways to Hedge Your Portfolio
There is an old trading adage that says “Sell in May and go away.” According to it, investors should close all equity positions in May, go to cash and get back into the market in November, thus avoiding a seasonal decline during summer and the first part of fall. However, the last three May months that still reside in my memory were profitable, obviously questioning if this concept is still valid. [Read more…] about Sell in June and Go Away?
While federal debt and budget deficit still remain within reasonable boundaries when compared to GDP, the tendency of these two fiscal metrics in absolute values continue to be worrisome. Some economists predict negative consequences if the trend continues unless the Government takes appropriate measures. One of such measures is to limit spending and optimize the budget. But it is easy said than done and seems unrealistic in the short and even middle-term. The other measure that the Government may consider or even be forced to do is to raise taxes at some point in time. However, this decision is not an easy one to make either. [Read more…] about 5 Legal Ways Investors Dodge Taxes
In my previous post, I analyzed the benefits of a Coverdell Education Savings Account and found out that it is a very powerful vehicle, despite its low $2,000 annual contribution limit. It can be used not only for elementary, middle or higher education, but for homeschooling as well, which makes it unique. In addition, the Coverdell ESA gives more flexibility in terms of investment choices, allowing you to invest almost in all stocks, bonds, and funds out there on the market. [Read more…] about A 529 Plan: A Good Vehicle For College Savings