query: What is considered high or low when talking about volume?

positive: The daily Volume is usually compared to the average daily volume over the past 50 days for a stock.  High volume is usually considered to be 2 or more times the average daily volume over the last 50 days for that stock, however some traders might set the crireia to be 3x or 4x the ADV for confirmation of a particular pattern or event. The volume is compared to the ADV of the stock itself, as comparing it to the volume of other stocks would be like comparing apples with oranges, as difference companies would have different number of total stocks available, different levels of liquidity and different levels of volatility, which can all contribute to the volumes traded each day.

positive: "Volume is really only valuable when compared to some other volume, either from a historical value, or from some other stock.  The article you linked to doesn't provide specific numbers for you to evaluate whether volume is high or low. Many people simply look at the charts and use a gut feel for whether a day's volume is ""high"" or ""low"" in their estimation. Typically, if a day's volume is not significantly taller than the usual volume, you wouldn't call it high. The same goes for low volume. If you want a more quantitative approach, a simple approach would be to use the normal distribution statistics: Calculate the mean volume and the standard deviation. Anything outside of 1.5 to 2.0 standard deviations (either high or low) could be significant in your analysis. You'll need to pick your own numbers (1.5 or 2.0 are just numbers I pulled out of thin air.) It's hard to read anything specific into volume, since for every seller, there's a buyer, and each has their reasons for doing so. The article you link to has some good examples of using volume as a basis for strengthening conclusions drawn using other factors."

negative: Open, high, low, close, volume. The hint is that volume on new years day is 0.  DC's comment is actually a better answer than mine - when given any data set, you should really know the meaning of each cell/number.

negative: The price of a share has two components: Bid: The highest price that someone who wants to buy shares is willing to pay for them. Ask: The lowest price that someone who has a share is willing to sell it for. The ask is always higher than the bid, since if they were equal the buyer and seller would have a deal, make a transaction, and that repeats until they are not equal. For stock with high volume, there is usually a very small difference between the bid and ask, but a stock with lower volume could have a major difference. When you say that the share price is $100, that could mean different things. You could be talking about the price that the shares sold for in the most recent transaction (and that might not even be between the current bid and ask), or you could be talking about any of the bid, the ask, or some value in between them. If you have shares that you are interested in selling, then the bid is what you could immediately sell a share for. If you sell a share for $100, that means someone was willing to pay you $100 for it. If after buying it, they still want to buy more for $100 each, or someone else does, then the bid is still $100, and you haven't changed the price. If no one else is willing to pay more than $90 for a share, then the price would drop to $90 next time a transaction takes place and thats what you would be able to immediately sell the next share for.

negative: The first statement is talking about a sudden sharp increase in volume (double or more of average volume) with a sudden increase in price. In other words, there has been a last rush to buy the stock exhausting all the current bulls (buyers), so the bears (sellers) take over, at least temporarily. Whilst the second statement is talking about a gradual increase in volume as the price up trends (thus the use of a volume oscillator). In other words (in an uptrend), the bulls (buyers) are gradually increasing in numbers sending the price higher, and new buyers keep entering the market. (The opposite is the case for a down-trend).

negative: Something to consider is that in the case of the company you chose, on the OTC market, that stock is thinly traded and with such low volume, it can be easy for it to fluctuate greatly to have trades occur.  This is why volume can matter for some people when it comes to buying shares. Some OTC stocks may have really low volume and thus may have bigger swings than other stocks that have higher volume.

negative: Well the thing to understand about HFT is that the volume levels heavily affect not just the earnings but also the ecosystem. HFT is almost always liquidity constrained so the volume and volatility is going to affect the overall profitability of the strategy since less of these things means fewer and smaller trading opportunities.  Since 2008 volume and volatility have been heavily negatively correlated with risk-on/risk-off. During risk-off periods investors seem to panic and trading hits a frentic pace. This describes late 2008 and more recently August 2011. Even in 2012 the highest volume/volatility period was in May when the Euro deals were in danger. Risk-on environments tend to be marked be calm, orderly buying.  Second the dark pool issue is bringing liquidity out of the lit markets where HFT normally makes its money. The primary reason for this trend is that dark pools are allowed to offer sub-penny quotes whereas lit exchanges are not. Because of this arbitrary regulatory constraint most of the time dark pools are going to offer better prices, especially on thick book securities.  But beyond that the level of volume effects some HFT players more heavily then others. Imagine all the HFT firms as a pride of lions. When volume is high and liquidity is flowing it's like the pride has brought in a giant water buffalo. The biggest, baddest cats eat first, but there's still food left for the cubs after they're finished feeding.  But if the pride only brings in say a baby gazelle the alpha cats will eat everything and the runts will go hungry. That basically describes what's happening now. A firm like RennTech or GETCO will make less money in a low volume environment, but still do fine. Marginal firms like Eladian will lose the ability to make any money.  Since the marginal firms need the press and the dominant firms tend to be more secretive than the NSA, you'll tend to read more about the former than the latter.

negative: Consider the case where a stock has low volume.  If the stock normally has a few hundred shares trade each minute and you want to buy 10,000 shares then chances are you'll move the market by driving up the price to find enough sellers so that you can get all those shares.  Similarly, if you sell way more than the typical volume, this can be an issue.

negative: In the scenario you describe, the first thing I would look at would be liquidity.  In other words, how easy is it to buy and sell shares.  If the average daily volume of one share is low compared to the average daily volume of the other, then the more actively traded share would be the more attractive.  Low volume shares will have larger bid-offer spreads than high volume shares, so if you need to get out of position quickly you will be at risk of being forced to take a lowball offer. Having said that, it is important to understand that high yielding shares have high yields for a reason.  Namely, the market does not think much of the company's prospects and that it is likely that a cut in the dividend is coming in the near future. In general, the nominal price of a share is not important.  If two companies have equal prospect, then the percentage movement in their share price will be about the same, so the net profit or loss you realise will be about the same.

negative: "You can do a lot of deduction FINRA keeps a ""REG-SHO"" list created daily that tells what the daily short volume is. March 26th 2014's list: http://regsho.finra.org/FNSQshvol20140326.txt If you are talking about the United States, this answer may be better ;)"

negative: Someone referred to the bend as a living hinge, I've heard it referred to as a kerf-bend.  My office has a laser cutter and might be interested in putting it to use.  What kind of volume are you looking for?  If low-volume, PM me.

negative: "This is only a concern if the payments can be realistically controlled by a central authority. What you're asking is only relevant when dealing with a centrally planned economy. I'm also not sure why you're talking about high payments surrounding basic living. What is ""basic living""? What is considered high? You're presupposing information into the question, which is a form of leading and taints the discussion."

negative: "Stocks with a low average daily trading volume (""thinly traded stocks"") will also tend to have higher spreads. So you'll tend to pay more when you buy and get less when you sell."

negative: Stock B could be considered to be more risky because it seems to be more volatile - sharp rises on large volume increases can easily be followed by sharp drops or by further rises in the start of a new uptrend.  However, if both A and B are trading on low volume in general, they can both be more on the risky side due to having relatively low liquidity, especially if you buy a large order compared to the average daily volume. But just looking at the criteria you have included in your question is not enough to determine which stock is riskier than the other, and you should look at this criteria in combination with other indicators and information about each stock to obtain a more complete picture.

negative: How I understand it is: supply/demand affect price of stock   negatively/positively, respectively. Correct. Volume is the amount of buying/selling activity in these stocks (more   volume = more fluctuation, right?). Sort of.  Higher volume means higher liquidity.  That is, a stock that is traded more is easier to trade.  It doesn't necessarily mean more fluctuation and in the real world, it often means that these are well-understood stocks with a high amount of analyst coverage.  This tends towards these stocks not being as volatile as smaller stocks with less liquidity. Company revenue (and profit) will help an investor predict company   growth. That is one factor in a stock price.  There are certain stocks that you would buy without them making a profit because their future revenue looks potentially explosive.  However, these stocks are very risky and are bubble-prone. If you're starting out in the share market, it's generally a good idea to invest in index funds (I am not a broker, my advice should not be taken as financial advice).  These funds aggregate risk by holding a lot of different companies.  Also, statistics have shown that over time, buying and holding index funds long term tends to dramatically outperform other investment strategies, particularly for people with low amounts of capital.

negative: Theoretically, it's a question of rate of return. If a desired or acceptable rate of return for market makers' capital is X, and X is determined by the product of margin & turnover then higher turnover means lower margin for a constant X.  Margin, in the case of trading, is the bid/ask spread, and turnover, in the case of trading, is volume. Empirically, it has been noted in the last markets still offering such wide-varying evidence, equity options: http://faculty.baruch.cuny.edu/lwu/890/mayhew_jf2002.pdf

negative: yes you are right as per my understanding while doing trade you must consider fol (specially for starters like me) The volume of the stock you are trading in should be high enough to keep you secure for quick in and out Whenever the bid volume is more than the ask volume the prices will move up and vice versa. to give an example if a stock is at 100 points and there are fol bids: The transaction will occur when either the bidder agrees to pay the ask price (case 1. he pays 101 . his bid offer will disappear and the next best ask will be 102. and the current price will be 101 which was the last transaction.) or when the person giving ask price agrees to deal at best bid which was 99 in which case the share will go down.

negative: Kek.  > Amazon is big enough to take full advantage of “postal injection,” and that has tipped the scales in the internet giant’s favor. **Select** high-volume shippers are able to drop off presorted packages at the local Postal Service depot for “last mile” delivery at cut-rate prices. With high volumes and warehouses near the local depots, Amazon enjoys low rates unavailable to its competitors.

negative: I think you're over complicating it! There is the market maker in the pure sense as what chilldontkill said - a bookie, a middleman. They are just the brokers in between the buyers and sellers, and they simply make profit off of the spread differential.  But market maker is also used to refer to large, high volume buyers and sellers that can influence the price because they control a larger % of volume. These only really exist on low volume products, and they slowly ween out the larger the volume. On higher volume products, I like to refer to them as institutions - that is, well informed, large pockets - whether is be central banks, clearing houses, hedge funds, boutique firms. These are the people who are generally in the know and they often bet against eachother.hope this helps ...

negative: Large volume just means a lot of market participants believe they know where the stock price will be (after some amount of time).  The fact that the price is not moving just means that about 50% of those really confident traders think the stock will be moving up, and about 50% of those really confident traders think the stock will be moving down.

negative: "Volume is measured in the number of shares traded in a given day, week, month, etc. This means that it's not necessarily a directly-comparable measure between stocks, as there's a large difference between 1 million shares traded of a $1 stock ($1 million total) and 1 million shares traded of a $1000 stock ($1 billion total). Volume as a number on its own is lacking in context; it often makes more sense to look at it as an overall dollar amount (as in the parentheses above) or as a fraction of the total number of shares in the marketplace. When you see a price quoted for a particular ticker symbol, whether online, or on TV, or elsewhere, that price is typically the price of the last trade that executed for that security. A good proxy for the current fair price of an asset is what someone else paid for it in the recent past (as long as it wasn't too long ago!). So, when you see a quote labeled ""15.5K @ $60.00"", that means that the last trade on that security, which the service is using to quote the security's price, was for 15500 shares at a price of $60 per share. Your guess is correct. The term ""institutional investor"" often is meant to include many types of institutions that would control large sums of money. This includes large banks, insurance companies, pooled retirement funds, hedge funds, and so on."

negative: It is important to consider your overall financial goals (especially in the 3-5 year range). If you have another financial goal which cannot be met without that additional money then meeting that financial goal might take priority over what I am about to say. Your mortgage rate is another important factor to consider when answering this question. Extra mortgage payments are equivalent to investing that money in a VERY low risk investment with an equivalent yield of the mortgage rate because you will be paying that much less per year in interest. (Actually, when you consider that mortgage interest is often tax-deductible the equivalent yield should be reduced by your income tax rate.) Typically it is not possible to find such a low risk investment with a yield as high as your mortgage rate. For example current mortgage rates are over twice as high as the yield of a one year CD.  Also keep in mind that additional mortgage payments help you build equity. This equity will most likely be applied to your next home purchase. If so their effect will be in place throughout the life of your next mortgage too.

negative: It is a fool's errand to attribute abnormal option volume or volatility to any meaningful move in the stock. One side of the chain is frequently more expensive than the other. The relationship between historical volatility and implied volatility is dubious at best, and also a big area of study.

negative: Given your premise is correct:  How do you cash in a large sum of YetAnotherCryptoCoin shortly after it´s ICO? The crypto-exchanges take some time to add a new currency, if they do at all. And even if they already have, trading volume is usually low.  I think that´s what really makes it unattractive for Investors as opposed to tec-enthusiasts (aside from the high volatility). Total lack of any reliable trading capability.

negative: Extremely low volume and market cap is a big problem, especially when the information about the company is well hidden. Most penny stocks are shell corps with someone manipulating the prices.   Although there are some big companies that sell different kind of shares on the otc market which might be worth looking into

negative: Buying pressure means there are more interested buyers than there are ready sellers putting upward pressure on prices. That might include institutional buyers who are slowly executing buy orders because they still want the best prices possible without clearing out the market. Buying pressure doesn't have to be related to volume at all. If everyone who owns shares think they are going to be worth far more than recent market prices, they will not offer them for sale. That means there is more demand to buy than there is a supply of shares to be bought. That condition can exist regardless of trading volume.

negative: "I was the one who made the beating you to the punch comment.   That liquidity is worthless without an active market. That's the whole point of liquidity. An ability to sell back when needed. High volume means nothing when the fucking HFT buys all the stock and holds you hostage to his sell price.   The only thing raising the price of pineapples is high speed trading. They only buy OR sell **when they see a bid.** That is not a traditional market maker.  Please, tell me how that is wrong. That is not a rhetorical question.  edit: If a pineapple is listed at 6.00 let's say you decide to buy and throw it in your cart. A store employee overhears you saying ""I'd be willing to pay 6.02 for this"". The employee tells the cashier to raise the price to 6.02 right before you get to the register. This is HFT in a nutshell. It doesn't provide an active pineapple market because the pineapple was only being offered once a buyer was lined up."

negative: For now it could possibly happen, assuming there are that many people wanting to offload their coins and recent charts are showing that trading volume is pretty damn low right now, even with prices being so high.  I'm going to guess most people with Bitcoin plan to hold onto it for a while.  Considering bitcoin can only be divisible to 8 decimal points (1 bitcoin = 1^8 satoshis), prices will start to skyrocket once supply cedes and (if) demand continues to rise.  Or so it should, if it ever reaches that point.  Most naysayers believe it'll die before it reaches that point.

negative: The last column in the source data is volume (the number of stocks that was exchanged during the day), and it also has a value of zero for that day, meaning that nobody bought or sold the stocks on that day. And since the prices are prices of transactions (the first and the last one on a particular day, and the ones with the highest/lowest price), the prices cannot be established, and are irrelevant as there was not a single transaction on that day. Only the close price is assumed equal to its previous day counterpart because this is the most important value serving as a basis to determine the daily price change (and we assume no change in this case). Continuous-line charts also use this single value. Bar and candle charts usually display a blank space for a day where no trade occurred.

negative: Not only are they high volume but also most finish materials are very basic. For example lighting fixtures, most builders put ceiling fans in all bedrooms ($75) where Rausch coleman uses a flush mount ($15) in the spare bedrooms.  Same with flooring they use a vinyl plank where most builders use wood. This can be $1sqft or more cheaper. Cabinets, carpet, tile, countertops, faucets, all they same. These are all cosmetics and you can save a ton of money while building by doing this and still build a quality home. Rausch Coleman builds a quality home at an affordable price by keeping the cosmetics basic.

negative: "Insofar as a 52 week high indicates a peak, yes.  However, the truth is that ""buying low and selling high"" means ""Act a Fool!"" You see, when you buy low, you are perceived to be buying total garbage - throwing your money away and conversely when selling high you are perceived to be a total idiot - selling a winner.  That's how people will see you when you are in fact buying low and/or selling high, right?  It's those people that (mis)value the asset, right?  An asset is worth what the people will pay for it, right? ...And don't forget that holding a loser is MUCH easier than holding a winner. Good luck!"

negative: You can't tell for sure.  If there was such a technique then everyone would use it and the price would instantly change to reflect the future price value. However, trade volume does say something.  If you have a lemonade stand and offer a large glass of ice cold lemonade for 1c on a hot summer day I'm pretty sure you'll have high trading volume.  If you offer it for $5000 the trading volume is going to be around zero. Since the supply of lemonade is presumably limited at some point dropping the price further isn't going to increase the number of transactions.   Trade volumes reflect to some degree the difference of valuations between buyers and sellers and the supply and demand.  It's another piece of information that you can try looking at and interpreting.  If you can be more successful at this than the majority of others on the market (not very likely) you may get a small edge.  I'm willing to bet that high frequency trading algorithms factor volume into their trading decisions among multiple other factors.

negative: If you're willing to shell out some cash, vendors will be quite happy to sell you everything you need. Picking one out of thin air, and no idea if this is a good price or not, the CBOE will sell you EOD data for every option for $40 for one day, and at a discount for multiple days.  Beyond the high/low/close for each contract, you get the volume. Or a month of TAQ data will run your $1550, for what that's worth, which probably isn't a lot for a retail strategy.

negative: This is what happened to Rubbermaid back in the 90s. They were the high flyer of the 80s but Walmart sold almost 90% of their volume and when they started demanding discounts rubbermaids business cratered. They were heavily leveraged so they ended up going into receivership because of it iirc.


query: Can I trust the Motley Fool?

positive: The Motley Fool is generally regarded as relatively legit, at least in that they're not likely to do anything outright fraudulent and they definitely have reasonably in-depth content to provide you.  The Motley Fool makes a fair amount of money off the subscriptions, though, and they do hawk them quite violently. If I didn't have a generally good opinion of them to begin with, I'd have been completely put off as well. It's pretty shameful. I don't think it's worth hundreds of dollars a year, but then again, I don't look at investing as a second career like the Fool likes to suggest, either.

positive: Upselling you is how they make money.  That's the price of the free content. Test their recommendations.  Pretend to buy the stocks they say.  How do they do?  Do they ever say to sell the stocks after their buy recommendations? There are lots and lots of opinions out there.  I doubt people really hear about the good ones because (a) the good ones have paid newsletters and/or (b) the good ones aren't telling a soul because they're absolutely cleaning it up. Warren Buffett doesn't announce his intentions.  He's been buying for a while before anyone finds out.

positive: Hmm.. hey bro, not personal, but is what comes to mind: I guess my answer will be highly down voted... =P

positive: "I've had a MF Stock Advisor for 7 or 8 years now, and I've belong to Supernova for a couple of years. I also have money in one of their mutual funds. ""The Fool"" has a lot of very good educational information available, especially for people who are new to investing. Many people do not understand that Wall Street is in the business of making money for Wall Street, not making money for investors.  I have stayed with the Fool because their philosophy aligns with my personal investment philosophy. I look at the Stock Advisor picks; sometimes I buy them, sometimes I don't, but the analysis is very good. They also have been good at tracking their picks over time, and writing updates when specific stocks drop a certain amount. With their help, I've assembled a portfolio that I don't have to spend too much time managing, and have done pretty well from a return perspective. Stock Advisor also has a good set of forums where you can interact with other investors.  In summary, the view from the inside has been pretty good. From the outside, I think their marketing is a reflection of the fact that most people aren't very interested in a rational & conservative approach to investing in the stock market, so MF chooses to go for an approach that gets more traffic. I'm not particularly excited about it, but I'm sure they've done AB testing and have figured out what way works the best. I think that they have had money-back guarantees on some of their programs in the past, so you could try them out risk free. Not sure if those are still around."

positive: "Not sure how I came across the Motley Fool blog in the first instance, but found the writing style refreshing - then along came some free advice on ASX share prospects, then the next day and email expounding the benefits I would get by joining up for two years at 60% off if I hit the button ""now"", getting in at ground floor on the next technology stock rocket - I replied: ""What a hard sell - why wouldn't I apply the age old adage of "" If it sounds too good to be true, it probably is"" Their reply was; ""Thanks for your note. The honest answer is that despite people knowing they should do something to help themselves prepare for their financial futures, few actually do it. We find these messages actually work in getting people to hit 'yes', much better than an understated email that just says 'here are our results and our philosophy - let us know if you're interested', unfortunately. Yours Foolishly"" So I have put some of these recommendations onto a watch list, time will tell."

positive: "I would personally beware of the Motley Fool. Their success is based largely on their original investment strategy book. It had a lot of good advice in it, but it pushed a strategy called ""The Foolish Four"" which was an investing strategy. Since it was based on a buy-and-hold method with 18-month evaluation intervals, it was not a get-rich-quick scheme. However, its methods were validated through data mining and subsequently turned out to be not so good. At least they admit this: http://www.fool.com/ddow/2000/ddow001214.htm"

negative: These advertisements try to take advantage of the short term memory loss of older people. If you keep an old person watching long enough they will forget why they started watching in the first place. Yet they trust themselves and assume that it was for a good reason. So the long winded salespitch succeeds with older people who tend to have more money to invest anyway.  Yes, I think that Motley Fool has jumped the shark.

negative: I've used Wikinvest before and think that's close to what you're looking for - but in Wiki-style rather than forums.  Otherwise, I agree with CrimsonX that The Motley Fool is a good place to check out.

negative: I would imagine that as a holder you will receive information in the post when it's made public, but I don't think it's been decided yet. This thread on the Motley Fool boards is keeping an eye on them - you might want to keep an eye on the thread.

negative: "Out of your seven recommendations one is up 14%, one up 6%, four are either even or down slightly and one is down a whopping 40%. This reminds me of a recommendation earlier in the year provided by The Motley Fool to buy XRO.AX when it was around the $40 mark. I had a quick look at it and thought ""gee there is no way I am buying those shares"". Now they are just below $15. See the chart below:  You have just learnt a valuable lesson by testing these recommendations without your real money - never trust investment recommendations from analysts (or anyone else). Get yourself educated so you understand what analysts are talking about and you can make a decision for yourself. Better still learn about technical analysis so you can decide for yourself whether it is the right time to buy or sell."

negative: "Is there anyway to salvage my investment for short-term? No.  If by ""salvage"" you mean ""get back as much as you paid"", the only way to salvage it is to wait as long as you consider ""short-term"" and see if goes up again.  If by ""salvage"" you mean ""get some money back"", the only thing you can do to guarantee that is sell it now.  By doing so, you guarantee that you will get neither more nor less than it is worth right now.  Either way, there is nothing you can do other than sell the stock or hold it.  The stock price went down.  You can't make it go back up. Would it be better if I sell my stocks now and buy from other company? Or should I just wait for it's price to go up again? This depends on why you bought the stock, and what you think it will do in the future.  You said a family member persuaded you.  Does that family member still think the stock will go up again?  If so, do you still trust them? You didn't even say what stock it is in your question, so there's no way anyone here can tell you whether it's a good idea to sell it or not.  Even if you do say what stock it is, all anyone can do is guess.  If you want, you could look the stock up on Motley Fool or other sites to see if analysts believe it will rise.  There are lots of sources of information.  But all you can do with that information is decide to sell the stock or not. It may sound obvious, but you should sell if you think the stock will go lower, and hold it if you think it could still go back up.  No one can tell you which of those things is going to happen."

negative: "You need to understand how various entities make their money. Once you know that, you can determine whether their interests are aligned with yours. For example, a full-service broker makes money when you buy and sell stocks. They therefore have in interest in you doing lots of buying, and selling, not in making you money. Or, no-fee financial advisors make their money through commissions on what they sell you, which means their interests are served by selling you those investments with high commissions, not the investments that would serve you best. Financial media makes their money through attracting viewers/readers and selling advertising. That is their business, and they are not in the business of giving good advice. There are lots of good investments - index funds are a great example - that don't get much attention because there isn't any money in them.  In fact, the majority of ""wall street"" is not aligned with your interests, so be skeptical of the financial industry in general.  There are ""for fee"" financial advisors who you pay directly; their interests are fairly well aligned with yours. There is a fair amount of good information at The Motley Fool"

negative: I dig the entire stable of Motley Fool podcasts. Motley Fool Money and Market Foolery are pretty fun and Industry Focus can offer some interesting insight.  I also enjoy the marketplace podcast with Kai Ryssdal. However some of the human interest pieces can stray farther from finance than I would like.

negative: If you see something that looks like a sales pitch, be skeptical, even if they sound informed, say things which resonate with your concerns and promise to alleviate your problems. Watch out in particular for people who pontificate about matters which are tangentially related to the investment (e.g. populist anti-Wall-Street sentiment). Beware limited-time opportunities, offers, and discounts. I'm specifically talking about your email pitches, Motley Fool. They're shameful. Remember you're allowed to change your mind and go back on something that you've said a few minutes ago. If anyone tries to trick you into agreeing to go along with them by taking what something you've said and manipulating it, or uses logic to demonstrate that you must buy something based on things you've said, tell them you're not comfortable, head for the door and don't look back. Don't be afraid of embarrassment or anything like that. (You can investigate whether your position is in fact logically consistent later.) Run away from anyone who resents or deprecates the notion of a second opinion. Don't ever go along with anything that seems shady: it may be shadier than you know. Some people thought Bernie Maddoff was doing some front-running on the side; turns out it was a Ponzi scheme. (Likewise the Ponzi scheme that devastated Albania's economy was widely suspected of being dirty, but people suspected more of a black-market angle.) Beware of anyone who is promising stability and protection. Insurance companies can sell you products (especially annuities) which can deliver it, but they're very expensive for what you get. Don't buy it unless you seriously need it.

negative: The Motley Fool's How to Invest How To Invest Benjamin Graham's The Intelligent Investor The Intelligent Investor If you like The Intelligent Investor then try Benjamin's Security Analysis.  But that one is not a beginner book.

negative: The motley fool is one of the best places.  Other good communities are Yahoo Finance, Seeking Alpha, and Investors Place. I also recently created a chat room connected to this site to discuss stocks/funds/etc. with other money.stackexchange users.  http://chat.stackexchange.com/rooms/263/investing

negative: I think your question is very difficult to answer because it involves speculation. I think the best article describing why or why not to invest in gold in a recent Motley Fool Article.

negative: "No. I glanced through the article you linked to.  It's quite lengthy, but not compelling. I'd not lose any sleep over this.  Others with far better credentials are making the opposite claim, that life is good and the Dow on its way to 20,000.   Back to this guy - StansberryResearch.com Reviews – Legit or Scam? offers a look at this company. Stansberry calls his company ""one of the largest and most recognized investment research companies in the world"" but references to his firm call it a clearinghouse for other authors newsletters.  Why would you give any more credence to his ranting than any other extreme prognostications?  I suppose if I told you I never heard of him it would be pretty meaningless. I certainly haven't heard of every financial writer. But if he's one of the most recognized, you'd think I might have. Note, I've edited since seeing I was downvoted. But to the question author, you might want to summarize your questions in the future instead of linking to a video or  13,000 word rant. (when you click to shut the video, the text is available.)"

negative: Start by paying down any high interest debt you may have, like credit cards.  Reason being that they ultimately eat into any (positive) returns you may have from investing.  Another good reason is to build up some discipline.  You will need discipline to be a successful investor. Educate yourself about investing. The Motley Fool is probably still a good place to start.  I would also suggest getting into the habit of reading the Wall Street Journal or at the very least the business section of the New York Times.  You'll be overwhelmed with the terminology at first, but stick with it.  It is certainly worth it, if you want to be an investor.  The Investor's Business Daily is another good resource for information, though you will be lost in the deep end of the pool with that publication for sure.  (That is not a reason to avoid getting familiar with it.  Though at first, it may very well be overkill.) Save some money to open a brokerage account or even an IRA.  (You'll learn that there are some restrictions on what you can do in an IRA account.  Though they shouldn't necessarily be shunned as a result.  Money placed in an IRA is tax deductible, up to certain limits.) ????? Profit! Note: In case you are not familiar with the joke, steps 4 & 5 are supposed to be humorous.  Which provides a good time to bring up another point, if you are not having fun investing, then get out.  Put your money in something like an S&P 500 index fund and enjoy your life. There are a lot more things to say on this subject, though that could take up a book.  Come back with more questions as you learn about investing. Edit: I forgot to mention DRIPs and Investment Clubs.  Both ideas are suggested by The Motley Fool.

negative: Whether or not I trust them depends entirely on the personal finance application. In the cases of Mint and Quicken, I would trust both. Always make sure to do plenty of research before submitting any personal information to any source.

negative: The Fools have a range of advice from common-sense to speculative, aimed at different audiences (one hopes). As always, don't take anyone's word for it; think it through and decide whether the risk/reward ratio is really in your favor and how much you can afford to risk. They're good on the basics, but the more advanced they get, the more risk there is that they've got it wrong. That last is true of any advisor unless they have information that the rest of us don't. You can learn some things from their explanations of their reasoning without necessarily taking their conclusions as gospel.

negative: I will be very interested in this subject as well in a few years. So far what I found is from an excellent article at the Motley Fool. Basically if you have between $200,000.00 and $1,500,000.00 in assets you should consider long term care insurance around age 55. Less than $200,000.00 and you will most likely qualify for some government hand out.  More than 1,500,000.00 and you can self insure.  Here is the article I found.  Fool article

negative: Yes, but only in a relatively short term. False news or speculations can definitely change the stock price, sometimes even significantly. However, the stock price will eventually (in the long-term) correct itself and head to the right direction.

negative: Yes. The real question is whether you should. You should consider your investment options, and take into the account that there's much more hype than value in many companies.

negative: "Yes, in my humble opinion, it can be ""safe"" to assume that — but not in the sense that your assumption is necessarily or likely correct. Rather, it can be ""safe"" in the respect that assuming the worst — even if wrong! — could save you from a likely painful and unsuccessful speculation in the highly volatile stock of a tiny company with no revenue, no profits, next to no assets, and continued challenges to its existence: ""There is material uncertainty about whether the Company will be able to obtain the required financing. This material uncertainty casts   significant doubt about the Company’s ability to continue as a going   concern."" As a penny stock, they are in good company. Still, there are a variety of other reasons why such a stock might have gone up, or down, and no one [here] can say for sure. Even if there was a news item, any price reaction to news could just amount to speculation on the part of others having enough money to move the stock. There are better investments out there, and cheaper thrills, than most penny stocks."

negative: Overall I think your idea is sound. The key here is to  choose that 401k provider wisely and have a specific asset allocation plan (like Joe mentioned) Summary of this approach: Pluses:  Minuses: I'd consider Vanguard for simple, no frills investing. If you're looking to get into choosing stocks, check out the Motley Fool.

negative: "The best answer here is ""maybe, but probably not"". A few quick reasons: Its not a bad idea to watch other investors especially those who can move markets but do your own research on an investment first. Your sole reason for investing should not be ""Warren did it""."

negative: I'd go to specialist community web sites such as The Motley Fool and read their investing articles, and their forums, and everything. You cannot get enough information and advice to get going, as it is really easy to think investing is easy and returns are guaranteed. A lot of people found that out in 2008 and 2000! For example, they have a 'beginners portfolio' that will teach you the very basics of investing (though not necessarily what to invest in)

negative: Roth IRAs divide your withdrawal into 3 categories: Contributions, Conversions, and Earnings. This is significant, because each have different tax consequences and the order of withdrawal is dictated by tax law. You can withdraw your contributions in less than 5 years for any reason (home buyer or not). You cannot withdraw your conversions or earnings without waiting 5 years unless you pay the 10% penalty.  The home buyer exemption is only after the 5 years are met. Further detail found on the motley fool: home purchase exemption, distributions, early withdrawals.

negative: "Don't do this if haven't talked about investments and don't learn quickly. Don't do this if you don't like cold calling. Don't do this if they want you to pump and dump. Don't do this if you don't think you can convince gamblers to invest with you. Don't do this if you have a better opportunity.  I checked their website. Maybe double check with FINRA and SIPC to see that they're really members if you're really skeptical and you're still interested. Just dial and keep asking until you get a better answer than ""If they say so then yes.""  Oh, and don't do this if they're giving you a shitty deal on commissions. Ask for a tour of the premises too."

negative: "For learning about finances my main two financial resources are this site, and the Motley Fool. My secondary sources are keeping up with columns by my favourite economic journalists - in the press in the US, Australia, England, and India. Regarding your comment about feeling green on the basics despite the reading - you're not alone. I've been interested in financials for better than 10 years, but there are a lot of questions on this site where I say to myself, ""I've no idea of what the answer could be, what are our resident experts saying?"" Having said that, there are some topics where I feel as though I can weigh in - and they tend to be where I have a little book knowledge and a lot of personal experience."

negative: "Legally ok? Sure. Friends frequently discuss financial matters, and share advice. This is quite far from taking money from them and managing it, where at some point you need to be licensed for such things. If you're concerned about giving bad advice, just stay generic. The best advice has no risk. If I offer a friend a stock tip, of course there's the chance the stock goes south, but when I tell a friend who asks about the difference between Mutual Funds and ETFs, and we discuss the expenses each might have, I'm still leaving the decision as to which ETF to him. When I offer the 'fortune cookie' soundbites like ""If you are going to make a large purchase, delay it a week for each $100 of value. e.g. if you really want a $1000 TV, sleep on it for a few months"" no one can mis-apply this.  I like those two sites you mentioned, but the one-on-one is good for the friend and for you. You can always learn more, and teaching helps you hone your skills."

negative: From what I see, it is more like .70 per contract, with a $1 minimum (for options that trade over a dime.)   IB does not provide any help, at all, so you have to know what you are doing.  I use tradeking, which charges about $6 for a contract, but you can call them for help if needed. There looks to be other fees for IB, like when you cancel an order, but that can be offset by other trades. It is one of the reason the Motley Fool Stock Adviser service has recommended IB for an investment.

negative: "According to the FAFSA info here, they will count your nonretirement assets when figuring the EFC. The old Motley Fool forum question I mentioned in my comment suggests asking the school for a ""special circumstances adjustment to your FAFSA"".  I don't know much about it, but googling finds many pages about it at different colleges.  This would seem to be something you need to do individually with whatever school(s) your son winds up considering.  Also, it is up to the school whether to have mercy on you and accept your request. Other than that, you should establish whatever retirement accounts you can and immediately begin contributing as much as possible.  Given that the decision is likely to be complicated by your foreign income, you should seek professional advice from an accountant versed in such matters."

negative: Congratulations on being in such good financial state.  You have a few investment choices. If you want very low risk, you are talking bonds or CDs. With the prime rate so low, nobody is paying anything useful for very low risk investments.  However, my opinion is that given your finances, you should consider taking on a little more risk. A good step is a index fund, which is designed to mirror the performance of a stock index such as the S&P 500. That may be volatile in the short-term, but is likely to be a good investment in the longer term. I am not a fan of non-index mutual funds; in general the management charge makes them a less attractive investment.  The next step up is investing in individual stocks, which can provide very big gains or very big losses.  The Motley fool site (www.fool.com) has a lot of information about investing overall.

negative: "Read ""How to win friends and influence people"" by Dale Carnegie. Don't be fooled by the overly self-helpie title. It's a great book.   Then consider reading ""The speed of trust"" by Steven M R Covey.   I'm sure you'll settle in just fine. Good luck!"

negative: The purpose of this spammy Motley Fool video ad is to sell their paid newsletter products.  Although the beginning of the video promises to tell you this secret trick for obtaining additional Social Security payments, it fails to do so.  (Luckily, I found a transcript of the video, so I didn't have to watch it.) What they are talking about is the Social Security File and Suspend strategy.  Under this strategy, one spouse files for social security benefits early (say age 66).  This allows the other spouse to claim spousal benefits.  Immediately after that is claimed, the first spouse suspends his social security benefits, allowing them to grow until age 70, but the other spouse is allowed to continue to receive spousal benefits.   Congress has ended this loophole, and it will no longer be available after May 1, 2016.

negative: "If by ""can we trust the analyst recommendations"" you mean ""are they right 100% of the time"" the answer is absolutely no.  Analysts are human and make mistakes, some more than others.  There are many stories of ""superstar managers"" that make killings for several straight years, then have a few bad years and lose it all back. However, don't take ""you can't trust them"" to mean that they are nefarious in some way. While there may be some that recommend stocks for selfish purposes, I suspect that the vast majority are just going off what information they have, and can't predict market behavior or future performance with perfect accuracy.  Look at many analysts' recommendations.  Do your own analysis. If you're still not comfortable buying individual stocks, then don't buy them.  Buy index funds if you are satisfied with market returns, or other mutual funds if you want to invest in specific sectors.  Or at the very least make sure you are sufficiently diversified so that you don't lose your entire investment by one bad decision.  One rule of thumb is to not have more than 10% of your entire portfolio in any one company."


query: Investment Portfolio Setup for beginner

positive: "Some thoughts: 1) Do you have a significant emergency fund (3-6 months of after-tax living expenses)? If not, you stand to take a significant loss if you have an unexpected need for cash that is tied up in investments. What if you lose/hate your job or your car breaks down? What if a you want to spend some time with a relative or significant other who learns they only have a few months to live? Having a dedicated emergency fund is an important way to avoid downside risk. 2) Lagerbaer has a good suggestion. Given that if you'd reinvested your dividends, the S&P 500 has returned about 3.5% over the last 5 years, you may be able to get a very nice risk-free return.  3) Do you have access to employer matching funds, such as in a 401(k) at work? If you get a dollar-for-dollar match, that is a risk-free pre-tax 100% return and should be a high priority. 4) What do you mean by ""medium"" volatility? Given that you are considering a 2/3 equity allocation, it would not be at all out of the realm of possibility that your balance could fall by 15% or more in any given year and take several years to recover. If that would spook you, you may want to consider lowering your equity weights. A high quality bond fund may be a good fit. 5) Personally, I would avoid putting money into stocks that I didn't need back for 10 years. If you only want to tie your money up for 2-5 years, you are taking a significant risk that if prices fall, you won't have time to recover before you need your money back. The portfolio you described would be appropriate for someone with a long-term investment horizon and significant risk tolerance, which is usually the case for young people saving for retirement. However, if your goals are to invest for 2-5 years only, your situation would be significantly different.  6) You can often borrow from an investment account to purchase a primary residence, but you must pay that amount back in order to avoid significant taxes and fees, unless you plan to liquidate assets. If you plan to buy a house, saving enough to avoid PMI is a good risk-free return on your money. 7) In general, and ETF or index fund is a good idea, the key being to minimize the compound effect of expenses over the long term. There are many good choices a la Vanguard here to choose from. 8) Don't worry about ""Buy low, sell high"". Don't be a speculator, be an investor (that's my version of Anthony Bourdain's, ""don't be a tourist, be a traveler""). A speculator wants to sell shares at a higher price than they were purchased at. An investor wants to share in the profits of a company as a part-owner. If you can consistently beat the market by trying to time your transactions, good for you - you can move to Wall Street and make millions. However, almost no one can do this consistently, and it doesn't seem worth it to me to try. I don't mean to discourage you from investing, just make sure you have your bases covered so that you don't have to cash out at a bad time. Best of luck! Edit Response to additional questions below. 1) Emergency fund. I would recommend not investing in anything other than cash equivalents (money market, short-term CDs, etc.) until you've built up an emergency fund. It makes sense to want to make the ""best"" use of your money, but you also have to account for risk. My concern is that if you were to experience one or more adverse life events, that you could lose a lot of money, or need to pay a lot in interest on credit card debt, and it would be prudent to self-insure against some of those risks. I would also recommend against using an investment account as an emergency fund account. Taking money out of investment accounts is inefficient because the commissions/taxes/fees can easily eat up a significant portion of your returns. Ideally, you would want to put money in and not touch it for a long time in order to take advantage of compounding returns. There are also high penalties for early disbursements from retirement funds. Just like you need enough money in your checking account to buy food and pay the rent every month, you need enough money in an emergency fund to pay for things that are a real possibility, even if they are less common. Using a credit card or an investment account is a relatively expensive way to do this. 2) Invest at all? I would recommend starting an emergency fund, and then beginning to invest for retirement. Once your retirement savings are on track, you can begin saving for whatever other goals you may have"

negative: In answer to your last formulation, no. In a perfectly efficient market, different investors still have different risk tolerances (or utility functions). They're maximizing expected utility, not expected value.  The portfolios that maximize expected utility for different risk preferences are different, and thus generally have different expected values. (Look up mean-variance utility for a simple-ish example.)  Suppose you have log utility for money, u(x) = log(x), and your choice is to invest all of your money in either the risk-free bond or in the risky bond. In the risky bond, you have a positive probability of losing everything, achieving utility u(0) = -\infty. Your expected utility after purchase of the risky bond is:  Pr(default)*u(default) + (1-Pr(default))*u(nominalValue).  Since u(default)= -\infty, your expected utility is also negative infinity, and you would never make this investment. Instead you would purchase the risk-free bond.  But another person might have linear utility, u(x) = x, and he would be indifferent between the risk-free and risky bonds at the prices you mention above and might therefore purchase some. (In fact you probably would have bid up the price of the risk-free bond, so that the other investor strictly prefers the risky one.) So two different investors' portfolios will have different expected returns, in general, because of their different risk preferences. Risk-averse investors get lower expected value. This should be very intuitive from portfolio theory in general: stocks have higher expected returns, but more variance. Risk-tolerant people can accept more stocks and more variance, risk-averse people purchase less stocks and more bonds. The more general question about risk premia requires an equilibrium price analysis, which requires assumptions about the distribution of risk preferences among other things. Maybe John Cochrane's book would help with that---I don't know anything about financial economics. I would think that in the setup above, if you have positive quantities of these two investor types, the risk-free bond will become more expensive, so that the risky one offers a higher expected return. This is the general thing that happens in portfolio theory. Anyway. I'm not a financial economist or anything.  Here's a standard introduction to expected utility theory: http://web.stanford.edu/~jdlevin/Econ%20202/Uncertainty.pdf

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