Thanks Art. Care to share your story? How you got involved in investing, where it's taken you, etc? I realize there might be a long history you don't feel like typing so super short cliff notes would be great if that's the case.

are you asking about carry trades?

I don't think so. (I just googled that term, and it sounds like it has something to do with currency.)

I'm just wondering exactly how changes in the FED funds rate changes interest rates (and by interest rates, I mean the rates that banks charge to non-bank customers).

Read the day trading thread. I'm actually working on something at the moment that will go into a great deal of depth, but being a perfectionist it might take a little time. Stay tuned

http://finance.yahoo.com/banking-bud...08837/dead-cat

Any thoughts on Mr. Kiyosaki's article?

Didn't want to start a new thread as I've recently started one.

My take is that it seems he is giving out a false sense of validity, in that yes, his "rule" works. But he makes no mention of any other time that it "didn't" work, and why when it "didn't" work, is "not" comparable to right now.

I don't really understand securitization. I just read the link below, but still don't quite understand. Can someone try to explain it to me? Maybe go into more detail about the specifics compared to the example given in the link below.

http://www.investopedia.com/terms/s/securitization.asp

This is a more detailed explanation. http://en.wikipedia.org/wiki/Securitization

Focus on understanding the motivation and benefits/risk of securitization

yeah, that guy is an idiot. he doesn't know anything about finance or investing or economics, he just pretty much makes stuff up and pukes it out on a page for ignorant people to gobble up.

i like john t reed and pretty much 100% endorse this
http://johntreed.com/Kiyosaki.html

This is part of an email interview for a job as a recruitment consultant London. I don't really know what sort of answer they would be looking for so any suggestions would be appreciated.

4) If you knew that no physical or mental harm whatsoever could happen to you, what would you say if you were stood up in front of the executive board of RBS right now? (use a minimum of 50 words to answer this question)

As far as I can see they seem to be doing fine again now. They all get high bonuses even though they said they wouldn't but if you don't get the right people you would jsut make it worse.

Not sure if this should go here, but I didn't know where else to put it (and figured that this would be the safest place). Is there anybody on BFI that knows a lot about the field of marketing (preferably someone who works in the field)? If so, could you please tell me who? In case it matters, I want to get into contact with someone and pick their brain about marketing. I'm interested in finance and marketing. However, it's much easier to find information online about careers within finance, so I don't really know what's out there in marketing, and am trying to determine if a career in marketing would be a good fit for me.

This question is somewhat silly, but it has me stumped, so I figured some of you bright folks could help me out.

If a stock does not pay dividends, then what are the benefits of owning stock?

I'm currently reading up on valuation methods for stocks. I am reading about discounted cash flow models, and just finished learning about the dividend discounted cash flow model. The price of a stock is the present value of the cash flows (i.e. the present value of all future dividends). It's very intuitive and makes a lot of sense why you would think of the stock price this way. However, then the book goes on to say, you can't value all stocks this way, because many companies don't pay dividends. Which got me thinking, what is the benefit of owning a share in a company that does not pay dividends? If you are not receiving payments from the profit of the company, then why would you want to own their stock? In other words, where does one get the value in owning a stock that doesn't pay dividends, since there are no cash flows being given to the owner?

Because there might be future dividends, buybacks, buy outs or whatever.

When using the free cash flow to the firm valuation method, the book I'm reading says to use the weighted average cost of capital method to estimate the required rate of return. However, these seem like two different things to me. Can someone please explain to me why we use WACC to estimate the required rate of return an investor would want to purchase the stock?

Ok, so even if there would never be dividends paid out in the future, there could still be cash flows if others buy the stock. However, why would others buy the stock if they won't get any cash flows? Because of buybacks and buy outs? Are buybacks and buy outs when a small number of people try to own the stock, because then those individuals will receive cash flows despite the company not paying dividends?

Because the stock represents a piece of the business and that piece goes up in value?

Growth stocks tend to not give a dividend because they are reinvesting in themselves.

If you hit the right growth stock spurt and sell at the right time, they are far better investments then value stocks that generally give dividends during that period of time.

The stock represents a piece of the business. My question is, how is this piece of the business realized by the shareholder, if there are no cash flows paid out? In other words, how does the shareholder actually get their piece of the business? With dividends, it's very obvious what the investor gets from owning the business (dividend cash flows every year). If, as a shareholder, you're not actually getting any of the profits, then what is the point? When a company doesn't pay dividends, it's not clear to me how the shareholder get's their piece of the profits. Sorry if I'm not articulating myself that well (it's not an easy question for me to formulate).

I know that, I'm just trying to make sense of how the owner actually gets money/cashflows from their investment.

The owner of the stock or the business?

The owner of the stock gets none, besides the base appreciation in value of the security and the realization of said gain upon selling the security.

Doesn't there have to be some way of getting cash from the investment (other than just the stock price) in order to justify paying a price to own the stock? If I pay to own a business (by purchasing stock), but I have no claims over the profits, than what good is being a partial owner in the business? People are presumably paying money for the stock, because there is some cash flows associated with owning part of the business. Right? Again, sorry if I'm not making sense. This has been really difficult for me to articulate. If I fail again, I'll try to illustrate using an example or something.

You could ask the same question about money losing companies: who would ever buy it?

In essence you're hoping/speculating/expecting more future cash flows if the company invests the money internally. The cash flows don't need to be put in the hands of the shareholder to have value.

Any advice for my situation as a newb woud be appreciated.. was recommended to post here.

Basically have like 200k extra in cash just sitting around that I'm not doing too much with at the moment. Not sure how liquid I need it to be since I'm uncertain if there may come a better investing opportunity that I find in the next 1-2 years that I want to put the money into instead. If I end up not needing to touch it then obviously I would prefer to be able to get a decent return on it.. if I do end up wanting to touch it then I'd like to be able to although I do think theres a decent chance I won't need to.

So in the mean time, what are some of the better options? I got some advice from a couple people that I was going to go with but just wanted to hear other opinions as well. I was told gold is very volatile.. would getting like 50k worth into gold be fine for diversification purposes for example then the rest into something else? If we assume that I'm convinced (whether legitimately or illegitimately) that the USD is going to be in bad shape what are some of the more passive investing options to hedge against this? Of that 200k I think I'd be able to stomach losing like 50-100k of it and being able to manage... but obviously would prefer not to, so I'm not sure what that means my risk aversion is.

What would be some of my options in this situation if I'd prefer to have something not in USD or that is prepared for an upcoming currency crisis? Hard assets like real estate or commodities? A portfolio with Vanguard? Foreign stocks denominated in foreign currencies? Generic ETFs? It seems that the most straight forward investment for what I'm looking for would be some kind of money market account or CD guaranteeing a certain return which seems fine but in USD. I guess since my risk aversion is decent I'm open to hearing other options too that might get better returns too.. any advice or ideas appreciated.

I'm looking to invest about 20-30% of my savings/emergency fund into bonds through either a ETF or mutual fund. Currently I keep all of my savings in a cash savings account/CD's through ING Direct. With rates being very low right now I would like to early a few extra percent on my money but still have relatively low risk. This money is separate from my retirement accounts which I follow a pretty normal diversification of stocks and bonds.

As I mentioned I am willing to accept some risk on this money, but do not want to invest in stocks or similar products. Ideally I would like to earn an annual rate in the 2-5% range. My timeframe isn't exact, but it will likely be a few years before I would ever need to touch the money (hopefully never).

Any advice or opinions? My understanding is that the fund/ETF price will move in a 10-20% range, while the yield will remain relatively consistent. Dividends paid would be reinvested. Anything wrong w/ this thinking?

Some fund/etf options I’m looking at - I'm leaning towards Ishares as Fidelity has no trading fees on them:
-Mix Ishares AGC & MUB
-Vanguard total bond - BLV
-Pimco Total Return - PTTRX which I use in my 401k

Advice or options appreciated thanks in advance!

Hi,

My sister in law just recently had a baby. I would like to get them a gift, they already have a ton of stuff for her so I want to do something different. I was thinking about buying her a stock... but I know nothing about them. I can across this company: http://www.oneshare.com/, I was just wondering if I could do something similar by buying the stock myself and framing it... where would I be able to buy a stock in Canada?

Thanks

Someone please explain to me what a trader does? I understand traders serve an important, unique role, I just don't understand what it is. I've read a little bit, but I still don't understand it. I'm not talking about people who trade their own portfolio and earn their income that way (because I think I understand that). What I don't understand, is how is a trader different than a broker? How do the traders at investment banks make money for their firm? On the buy-side, what does a trader do? Don't the portfolio managers make the investment decisions? So why do these portfolio managers and asset management firms need traders? Why don't they just contact a broker? How is the trader adding value? What is a prop trader?

I am unable to meet my minimum on credit card payments and am considering calling the company to ask for a payment plan. Does anyone know if/how it will affect my credit score? I know they will close my account as soon as I request one whether they approve it or not so my available credit to what I owe will be affected, but I don't know how much damage this will do. I also don't know how it is reported to the credit bureaus.