Risk Tolerance

Forex trading is becoming more popular in the recent years due in part to the fact that it is more accessible to the general public. It used to be that the currency market was the province of institutions and the wealthy, but technology and other factors have made forex investing, like other types of investing, [...]

Defining a good goal is hard enough in itself, but people still fail even with well thought out SMART goals. Why? The answer is simple: they fail to turn these goals into actions. Generally, a goal is broad and hard to identify practical ways to achieve it. To transform your goals into practical actions is [...]

Should I get back into the stock market? You might be asking yourself this question if you had bailed out during the recent market downturn and watched it climbed almost 30% in March. I don’t blame you if you got out. Many people developed their investment strategy while the stock market was doing well, and [...]

Have you started your tax returns yet? If not, please check out my TaxCut Premium Federal + E-file giveaway – the first of four winners will be announced this Tuesday. As for me, my returns are almost done, I am just waiting to open a SEP IRA account with TradeKing and fund my wife’s Roth [...]

The financial terms below are commonly used throughout this web site.  Clicking on a term will send you to the term page with a brief definition and a list of articles related to the term.

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A
B

401(k)
529 Plan

Adjustable Rate Mortgage (ARM)
Alternative Income
Annual Percentage Rate (APR)
Annual Percentage Yield (APY)
Annuity
Arbitrage
Asset Allocation
Asset Location

Bond
Bond Fund
Budgeting

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E

Capital Gains
Certificate of Deposit (CD)
Commodities
Contribution Limit
Correlation
Credit Report
Credit [...]

My company made Vanguard Target Retirement Funds available for our 401k accounts about two years ago. However, I have not used them preferring to manually manage my own portfolio using traditional funds that include bond, large-cap, small-cap, international stock, and REIT funds. However, Target Retirement Funds are not without merits — in fact, I’ve been [...]

Bonds, or fixed income securities, are debt instruments issued by companies or the government that pay a certain amount of interest, and the full principal amount at the maturity date. The interest rate for bonds depends on a variety of factors, such as the current market interest rates, the maturity date, and the credit worthiness [...]

With the current economic crisis in full swing, it’s easy for us to fall into the recency bias trap.  In psychology, the recency effect is the tendency to remember more recent events or observations more vividly and give recent information more weight than historical information. Unfortunately, this recency bias could cause you to abandon your [...]

A friend of mine is hit hard by the 40% plus drop in his 401(k) and the daily gyration haven’t made it any easier.  He was seriously considering cashing out of his 401k and stop contributing altogether.  After a long conversation with him, I was able to explain to him why this was a bad [...]

Asset allocation is an investing a strategy for maximizing gains while minimizing risks in your investment portfolio. It involves diversifying your assets among different broad categories of investments, such as equity, fixed income, and money market, etc.  By reducing your investment risks, you’re in a better position to meet your financial goals.
How Asset Allocation Works
The [...]