Well, with a lower %, you won't be a millionaire in 10 years...

18% isn't completely ridiculous. Investing in higher volatility stocks and/or with leverage, it's doable. There's just a very solid chance you won't make it, and maybe even come out a "loser" over the time period.

MFE in toronto? what school?

EDIT: ahh, financial economics. that's not what an MFE is!

that's if you invest at the end of the year. it's <15% if you invest at the start of the year.

Thanks for answering my noob questions

He and his finance class looked over the stock markets past 10 years, and they calculated if a person makes 40k a year, only spends 16k a year and invests the rest (50% conservative, 50% aggressive) until the fund reaches 50k and then leverages 50% of the 50k and repeats the process then the investor would be a millionaire within a decade. Sounded pretty crazy

What are the pros/cons of buying CFDs that track indexes vs ETFs? Are there any downsides?

Interactivebrokers is offering S&P500 CFD for 0.005% commission and ASX200 for 0.01%
Here: http://ibkb.interactivebrokers.com/node/1984

I have Vanguard (VOO) S&P500 which is 0.05% commission, so Im paying 10x the CFD?

I have bought Vanguard (VAS) ASX300 ETFs which are 0.15% fees. So I am paying 15x the fees for this Vanguard ETF vs a CFD?

Is this correct? Am I missing something?

Vanguard ASX200 ETF info: https://static.vgcontent.info/crp/in...0121009|220300
Vanguard VOO S&P 500 ETF info: https://personal.vanguard.com/us/fun...T#hist=tab%3A3

Hurricane Sandy- There's a lot of damage along the east coast. What are you investing in?

that page says the cfd resolves your account each day. Is the fee daily? That would be a big difference from an etf annual fee.

Regarding the bolded part: did they leverage 50% of the account "each year" or what?

The last time I used CFDs which was a few years ago the broker only offered leveraged positions. This means if you want the equivalent notional exposure to your existing ETF position you will only need to put down 5-10% in margin, but will pay interest on the remaining 90-95% of your position. So you should add this cost into your fee comparison if it applies with the broker you have linked.

iirc you did have the option to fully fund your account with the remaining cash on your position, but they only paid me libor - X on my cash, while charging Libor + X on the leveraged portion of my positions.

As I said this was a fea years ago so I don't know if it will apply here.

sorry didn't see an OT thread


Ebay selling question:

A bidder in my state asked me if instead of me shipping we could meet in person. At first I told him yes, but now I'm not sure. iirc ebay recommends you not do this for some reason. Anyone know if this is a bad idea? Like, maybe they can pay you in person and get the item and then claim you never shipped it?

In this case, you can just claim that they never paid you.

probably safety related. Might just be a carryover from 10 years ago when everybody on the internet was a sexual predator. Or just that they might try to mug you for the item.

I've sold on ebay before and then collected the money and transfered the product in person. Didn't have any issues.

Quick question about salary and 401k:

I work for a company and make ~$50k (been there 2 years). For the 401k the company matches 100% of what employee contributes up to 6% and 50% for every additional percentage. I am currently contributing 8% and they are matching 7%.

My question is, how "okay" is it to break even on salary and to only save what you put in the 401k? Is this normal?

I ask this because I am weighing the negatives of putting myself in a living situation where my expenses would be very close to my disposable income. I have an okay amount of money in the bank for 24yrs old (~40K) so its not like I'm living paycheck to paycheck. Any thoughts on this would be helpful because I'm used to saving a decent amount of my income per month.

Contribute to 401k company match - 6%
Then put $5000 into a ROTH IRA
Then contribute to the 401k up to what you can afford.

Just remember your expenses every month are not completely static.

i will add that this:

is almost never a good idea. for most people, life gets more expensive the older you get. do you want a house some day? a family? take advantage of time and compound interest while you can.

This sounds like a really solid plan, contributing 5k a year to the roth seems like a great idea

just opened one up, 5k contributed!

I have a simple question about dividends. Is the yield a set dollar amount given at the end if the year or is it based off of a certain percentage of the current price of the stock?

Both (sorta)

The yield (percent) is always a trailing value based on the last total dividend over the course of the trailing fiscal year (12 months basically). Since only the company itself knows the future dividend, until it reports what that dividend will be the yield is incalculable for the future.

So for example a $50 stock has a 2% yield which means that either one time a year $1 per share is given out or $.25 every fiscal quarter (the usual).

Now since the value is trailing rather then forward, the stock might reach $55 and now the yield is "only" 1.8%, but its still $1 / year.

Quick question: Where's the best place to start a ROTH IRA? Is it still Vanguard?

I'm just looking to get something started with the lowest costs possible. Thanks for any input.

I have mine with Vanguard and I haven't really looked into moving it since I won't be able to contribute to it after this year. From what I've heard, there was something of a price cutting war and the difference between Vanguard and the others isn't as great as it used to be but you still can't go wrong with Vanguard.

Yes, Vanguard. The pricing war for expense ratios is ridiculous. Its preying on people who are bad at math.

For example, these are made up but basically the gist...

Vanguard Total Stock Market Index ER is like .17%
T Rowe Price Total Stock Index ER is .12%

.05% is $5 for every $10,000

Its just not worth switching or choosing one over the other.

Thanks guys. Any advice on what my asset allocation should be for starting out? I don't plan on taking it out for a really long time (i.e. I plan on leaving it there until retirement in 20+ years). I'm just trying to get it done before the end of the year so it's taken care of.

"your age in bonds" or "your age - 10 in bonds" are common rules of thumb.