Senate passes landmark financial oversight legislation
July 15, 2010
The Senate passed landmark financial overhaul bill 60-39 Thursday, following House passage last month. The bill is to be signed into law by President Barack Obama soon. The passage of the sweeping bill ends more than a year of wrangling over the shape of the new rules.
The bill marks a potential broad change for the financial-services industry. The legislation creates a council of federal regulators to monitor economic risks; establishes a new agency to police consumer financial products; and sets new standards for the way derivatives are traded. It leaves a vast number of details for regulators to work out, inevitably setting off another round of battles that could last for years.
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Major economic indicators for investors
July 10, 2010
Government agencies, industry groups, and non-profit organizations generate a nonstop flow of statistics on the U.S. economy. Economic indicators provide real-time information on the direction of the economy as it relates to economic growth, inflation, jobs, and the health of the financial markets, according to economists.
Do you ever wonder what those reports really mean or why they're important to you as an investor?
Investors use the economic data to interpret current or future investment possibilities and judge the overall health of an economy. The key information to extract from these indicators is how far they differ from what was expected. Financial markets are forward-looking, and securities prices incorporate economists' consensus forecasts for economic growth, inflation, jobs, etc. Markets react to an indicator only when the actual release of that indicator comes above or below what was originally expected.
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S&P 500 topped 1,200, first time in a year and a half
April 14, 2010
Good news and improving economy lifted spirits on Wall Street Wednesday. The Standard & Poor's 500 index broke through a key milestone 1,200 mark for the first since September 2008, after rising 13.35 points to 1,210.65. The Dow Jones industrial average rose 104 points to end at 11123.03, after on Apr. 12, 2010
the Dow broke the 11,000 point for the first time since Sept. 26, 2008.
The positive news came from all directions. Corporate earnings numbers show strong results. Shoppers and businesses are feeling better about the improving economy. Retail spending rose sharply in March, while consumer inflation remained all but invisible. Businesses boosted their stockpiles for the second straight month in February in anticipation of higher shopper demand.
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Dow finishes above 11,000, first time since Sept 2008
April 12, 2010
U.S. stocks closed slightly higher on Monday, with the Dow Jones Industrial Average finished above 11,000 points for the first time since Sept. 26, 2008. The move was the latest milestone in a rally that has brought Wall Street back from the verge of economic
collapse.
It came amid signs that U.S. companies were poised to report strong first-quarter profit with earnings season beginning this week, as well as investors welcomed a rescue plan for Greece. On Sunday, European Union officials delivered details of a $40 billion rescue package.
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Online Tools: Checking for Fraud
February 8, 2010
For investors spooked by financial scams and scandals, the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) offer tools to monitor stockbrokers and identify and avoid fraud. They are helpful for investors who are afraid of getting into investing because of recent scandals and the economic meltdown.
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Constructing Portfolio Using ETFs
February 6, 2010
Having the right mix of stocks, bonds, cash, and commodities in your portfolio, and being well diversified within each
asset class, can have a profound impact of your returns.
ETFs can be an easy way to gain this diversification. They can be cheap, flexible, and tax-efficient and may help you gain access to sectors and asset classes that would otherwise be closed off to individual investors.
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Stock Market Anomaly: January Effect
Updated: January 3, 2010
Historically stocks of small-cap companies had seasonal tendency of outperforming the large-caps around the turn of the year, specifically during January. The existence of this
January Effect of stock market return has been widely known. In back testing, researchers have found that it existed in many prior decades.
There are some theories behind this stock market anomaly. Two possible explanation on the January effect are that investors’ activity of buying back into beaten-down small-caps, which were probably sold for
tax loss harvesting and
window dressing reasons late in the outgoing year. Others speculate that the phenomenon has something to do with
less information flow of small cap stock during the year.
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Tax-Loss Harvesting
December 15, 2009
From a tax standpoint, dumping losing-money security prior a year end is not a bad idea. The tax advantages of setting your gains against your losses can be enormous as long as you follow all the rules and implement a few tricks of the trade.
Tax-loss harvesting, also commonly known as tax selling, is one of the ways to avoid taxes on some of your portfolio gains. Tax-loss harvesting is the selling of securities, usually at year-end, to realize portfolio losses, which an investor can use to offset capital gains and therefore lower personal tax liability.
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