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Investing facts

Investing facts, tip about hot stocks

The price of hot stocks like IPOs and tech stocks can rise and fall suddenly.

"In these fast markets when many investors want to trade at the same time and prices change quickly, delays can develop across the board. Executions and confirmations slow down, while reports of prices lag behind actual prices. In these markets, investors can suffer unexpected losses very quickly."

"To avoid buying or selling a stock at a price higher or lower than you wanted, you need to place a limit order rather than a market order. A limit order is an order to buy or sell a security at a specific price. "

Reference: http://www.sec.gov/investor/pubs/onlinetips.htm

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The difference between stocks, bonds, and commodities

Stock: The shares of a company or corporation.
Bonds: A certificate of debt issued by a government or corporation guaranteeing payment of the original investment plus interest by a specified future date.
Commodities: an article of trade or commerce, esp. a product as distinguished from a service.

While bonds generally promise a fixed return, earnings on commodities and stocks go up and down as determined by the free market.

Reference: http://dictionary.reference.com

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A couple good places to research bonds

The following companies rate the financial condition of corporations and municipalities issuing bonds. Their ratings are available online and at many public libraries.

* Standard & Poor’s
* Moody’s Investors Services
* Weiss Ratings

Reference: http://www.consumeraction.gov/caw_investing_general_tips.shtml

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Diversify your portfolio

Some investments perform better than others in certain situations. For example, when interest rates go up, bond prices tend to go down. One industry may struggle while another prospers. Putting your money in a variety of investment options can help to reduce your risk.

Reference: http://www.consumeraction.gov/caw_investing_general_tips.shtml

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Where does Warrent Buffett invest his money?

Billionaire Warren Buffett is a legendary investor who has amassed a huge fortune through plays in a wide range of industries.

He tends to favor companies with relatively simple businesses, strong management, consistent earnings, good returns on equity, and little debt.

Reference: http://www.reuters.com/article/wtMostRead/idUSN0631767220080207

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Sadness May Encourage More Extravagance

A new study (2/08) suggests that sadness leads to shopping.

According to the study that will be published in the June 2008 number of Psychological Science, sadness leads to ego-centrist thinking. In other words, a sad person tends to transform into a shopaholic, willing to spend extra money on the same item than neutral-emotion people would buy for a lot less.

It is the combination of sadness and self-focus that drives the effect, and it turns out that sadness leads to an increase in self-focus, said Cynthia Cryder, co-author to the study, AFP quotes. What we think is going on is that sad and self-focused people are feeling pretty bad about themselves and have a decreased valuation, and one way to do this is by acquiring material goods.

Oh yeah, it also says this therapy does not work. If youre sad and feel like shopping, dont!

Reference: http://www.efluxmedia.com/news_Feeling_Sad_Shopping_Is_Not_The_Answer_Study_Warns_13799.html

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