Ten Tips for Online Investors - Ten tips to consider when investing online.
Cutting Through the Confusion - explains the differences between brokers, investment advisers, and financial planners and identifies questions investors should ask themselves and potential providers before making a choice.
How to Check Out Your Stockbroker or Brokerage Firm - As an investor, you can request a public report of background information on any stockbroker or brokerage firm. Depending on the state jurisdiction, this report can be obtained either free of charge or for a nominal fee. In addition to employment and examination history, the CRD report will contain various types of disciplinary history, if applicable.
Consumer Guide to Small Business Investments - State laws have been relaxed to make it easier for small businesses to raise start-up and growth financing from the public. Many investors view this as an opportunity to "get in on the ground floor" of emerging businesses and to "hit it big" as these small businesses grow into large ones. Statistically, most small businesses fail within a few years. Small business investments are among the most risky that investors can make. This guide suggests items to consider for determining whether you should make a small business investment.
Promissory Notes: Promises, Problems (PDF, 673KB) - Many investors seek out safe, fixed-rate investments, especially ones that can boost the interest they earn. But as you consider new investment products or services, always remember the correlation between risk and reward: every investment involves some degree of risk, and the greatest-yielding investments usually carry the highest levels of risk. One interest-paying investment is the promissory note. These are an important means by which companies raise capital. Legitimate promissory notes are marketed almost exclusively to sophisticated or corporate investors that have the resources to research thoroughly the companies issuing the notes and to determine whether the issuers have the capacity to pay the promised interest and principal.
Affinity Fraud - The evil of 'affinity fraud' is that normally savvy or skeptical people let their guard down when offered a questionable investment by a member of a group to which they belong and with whom they have a common background and interest - whether ethnic, religious, political or professional. People's pocketbooks are simply more likely to open when the approach is made by a member of their own group or when they hear that other members of their group are investing.
CD Alternatives - When the rates offered by banks on CDs (Certificates of Deposit) and savings accounts decline, many consumers look for higher yielding investment options. An increasing number of consumers have taken on more risk by moving into stocks, bonds, mutual funds, fixed-income insurance products such as annuities, and other investment vehicles. Indeed, almost any investment product may be marketed as a CD alternative.
Preventing and Resolving Disputes - Most brokerage firms and their sales agents/brokers deal honestly and fairly with their customers. However, sometimes difficulties and disputes arise and on rare occasions, fraud and theft may occur. There are several steps you can take to protect yourself from becoming a victim of fraud or abuse. There also specific steps you should take to resolve problems when they do occur.
High Tech Investment Scams Are on the Rise - Fraudulent investments in high technology and FCC licenses have become one of most devastating get-rich-quick scams of the 1990's. These schemes have cost consumers hundreds of millions of dollars. Scam artists prey on the public's interest in the "information superhighway" by marketing investments in new technologies that often require ownership of Federal Communications Commission (FCC) licenses. Fraudulent telemarketers entice investors with promises of enormous profits just for owning an undeveloped piece of the airwaves or for becoming an investment partner in the building of a system after the license is acquired.
Choosing Investment Advisers and Financial Planners - A recent survey conducted by The Nasdaq Stock Market indicates that stock ownership among the general public has doubled in the past seven years (43% of American adults). The demographics of investors have changed dramatically, with investing no longer the exclusive province of the elderly, affluent, or male. Forty-seven percent of investors are women. Of the women investors, 45 percent say they are the ones primarily responsible for making the investment decision in their households. A majority of investors (55%) are under the age of 50, and one half are not college graduates. Most working-age investors describe themselves as blue or white collar workers (35%) rather than manager/professionals (29%). Ten percent are homemakers.
Municipal Bonds - Municipal bonds--known as "munis"--are bonds issued by a state, territory, or possession of the United States or by any municipality, political subdivision, or authorized agency. "Munis" are extremely popular because the interest earned by the investor is usually exempt from state and federal taxes. However, the risks of investing in municipal bonds are often the most misunderstood investment instrument likely to end up in the portfolio of a typical investor. A bond is an obligation that must be repaid at a certain time, possibly in 10 or 20 years. In the interim, the borrower pays interest to the bondholder for the use of his or her money.
Superhighway to Financial Ruin - Steve Davis sits down at his home computer after a long day's work. Steve has managed to save a few thousand dollars and is thinking about investing in the stock market. Like many Americans, Steve recently became connected to the Internet, and he has found it to be a fascinating and useful tool for acquiring information on just about any subject. Tonight, he logs on and connects to his favorite investment-related bulletin board. He enters an electronic chat room, where a discussion is in progress.
How to Select and Work with a Stock Broker - Investing in the stock market can be a complex business. The assistance of a good stockbroker can be an essential element in achieving success with investments and in the stock market. A stockbroker, also known as a registered representative, account executive, financial consultant, and securities salesperson, is an employee of a brokerage firm. Both the brokerage firm and stockbroker need to be licensed/registered by the state securities agency in each state in which stockbroker will be transacting business with customers.
Seniors Should Act to Keep Scam Wolves From Door - Retirees are prime targets for con artists and swindlers. Many have money in the bank. They're wary of the stock market and tired of earning less than 3% on a certificate of deposit. Even better, they're often too polite to hang up on a smooth-talking solicitor. In today's Managing Your Money, we look at scams, schemes and bad investments that threaten seniors' financial security.