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<|im_start|>user
Generate the answer for the following question
Should I lease, buy new, or buy used?
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<|im_start|>assistant
Rule of thumb is always BUY, NEVER lease, unless you plan to use it for a business where you can expense the lease payments. Leasing is the biggest scam. Lease is just a fancy word for renting and the dealerships PRAY that people like us lease. As for new or old, new cars have better warranty but you may get a great deal on a 1-3 year old used car.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Will I have to pay taxes for Australia if I have an Australian bank account?
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<|im_start|>assistant
Because you actually reside in New Zealand, your income taxes will be paid in New Zealand. However, as a non-resident of Australia you will have tax withholding on all of the interest you earn in an Australian bank account. Obviously, because that tax is paid to Australia, that will not be counted against your New Zealand income taxes due to the taxation agreement between those countries. You should still discuss this with an accountant in New Zealand and consider acting as a sole trader. Since you are doing freelance work, that seems like the most logical setup anyway.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
For a car, would you pay cash, finance for 0.9% or lease for 0.9%?
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<|im_start|>assistant
If you want the new car, pay cash for it. Here's why: By paying cash for the car, you immediately save $2,500 off the price of the car. That is not insignificant, it's 8.3% off. By paying cash, you'll never be upside down on the car, and you can sell the car anytime you want. You said that all you need to do is beat the 0.9% interest rate with your investment to come out ahead. That doesn't take into account the discount you would have gotten by paying cash. $30,000 invested for 5 years at 1.6% (rough estimate) would get you $2,500 (the discount), so the rate you need to beat to come out ahead is actually 2.5%. Still doable, but it is much less of a sure thing on a 5 year investment, and much less worth the trouble. New cars are an expensive luxury. If you are wealthy enough, a new car certainly can be appropriate for you. However, if you don't like the idea of paying $30k in cash all at once, that is a strong indication that perhaps the new car is a luxury you aren't in a position to buy at this time. Borrowing the money and paying for it over time makes it psychologically easier to over spend on transportation.
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<|im_start|>user
Generate the answer for the following question
Can you short a stock before the ex-div. date to make a profit?
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<|im_start|>assistant
When you short a stock and the stock goes ex-div. you have to pay out an amount equal to the dividend. So in your example, GG would short the stock at $10.00, buy back at $9.00 and be charged $1.00 for the dividend. Net effect $0.00.
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<|im_start|>user
Generate the answer for the following question
Shares; are they really only for the rich\/investors?
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<|im_start|>assistant
Small purchases will have a disproportionate expense for commissions. Even a $5 trade fee is 5% on a $100 purchase. So on one hand, it's common to advise individuals just starting out to use mutual funds, specifically index funds with low fees. On the flip side, holding stocks has no annual fee, and if you are buying for the long term, you may still be better off with an eye toward cost, and learn over time. In theory, an individual stands a better chance to beat the experts for a number of reasons, no shareholders to answer to, and the ability to purchase without any disclosure, among them. In reality, most investor lag the average by such a wide margin, they'd be best off indexing and staying in for the long term.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What is a good investment vehicle for introducing kids to investing?
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<|im_start|>assistant
Buy them a physical stock certificate... you can request them from a broker, or buy through a company like http:\/\/www.oneshare.com. Other options:
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<|im_start|>user
Generate the answer for the following question
Does dollar cost averaging really work?
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<|im_start|>assistant
If you know with 100% certainty what the market will do, then invest it all at the best time. If not, spread it out over time to avoid investing it all at the worst possible time.
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<|im_start|>user
Generate the answer for the following question
What does ES1 refer to in this picture?
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<|im_start|>assistant
That looks like a Bloomberg terminal. And like @Jer said, it would appear to be the symbol for the S&P 500 E-mini index future. Although it doesn't look right all on its own, as it should have a modifier indicating the month (or quarter) of expiry. However, since it appears on a Bloomberg terminal in the image, I checked a source for Bloomberg Symbol Lists and found one of two possibilities for ES1. It is most likely the S&P 500 e-mini future: CME E-Mini Futures E-Mini S&P 500 ES1 INDEX the only alternative was LIFFE 3 Month Euroswiss ES1 COMDTY I think the former is far more likely, as the latter has the COMDTY commodity tag instead of INDEX as the tag in the image. Also, it isn't the ESI which pertains to Ethibel Sustainability Indices and something with the Eurozone (also Bloomberg Indices). Here we go! Excerpt straight is from a presentation presentation on charting from a business school PDF see pp.12-13, and appears to be a straight excerpt from September 2007 Bloomberg documentation. I didn't know any other way to imbed it besides taking a screen shot then uploading to imgur. Or of course, see pp.12-13 in the referenced PDF I've attached. See
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How can a school club collect money using credit cards?
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<|im_start|>assistant
Large and small universities have procedures in place regarding the use of the universities name, logo, facilities, and budget. They should have in place guidelines regarding the collection and use of funds from members, and participants. These guidelines are what allows you to have an account with the university. Generally these are not kept in the credit union but are with the university treasurer. I would approach this as if I knew nothing about how to get an officially recognized club or organization started. They should then provide you with all the rules and policies regarding money for student organizations. These policies may also discuss how to collect cash, checks, and credit cards. Some universities also allow the use of special card readers to process the special debit card attached to your university ID. The 10% fee charged by the university is typical. They will need to account for your funds, while maintaining their tax exempt status. If you get fully inline with their policies that will allow you to avoid tax issues.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How many days does Bank of America need to clear a bill pay check
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<|im_start|>assistant
This is based on my experience with Chase and may not be applicable to other banks. As you mentioned Chase as one of the banks you do business with hopefully this will be helpful to you. The money does come out of your account immediately. If the check isn't cashed in a certain amount of time, the check expires and you get the money credited back to your account. Once you have made a bill payment online you can check on the status of your check by looking at your payment activity, finding the payment in question, and following the "proof of payment" link. There is will provide you with information on your payment which you can submit to your payee to prove when you submitted the payment, and which they can use to verify with the bank that you really did send the payment as you claimed. Once the check is cashed, this page will also contain images of the front and back of the cashed check, so you can prove that the recipient really did cash it. You can see from this info that the check is being funded from a different account number than your own, which is good for security purposes since (per Knuth, 2008) giving someone else your bank routing number and account number as found on your personal checks basically provides them with all they need to (fraudulently, of course) clean out your account.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Fund equalisation \/ dividend
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<|im_start|>assistant
Do all\/most unit trusts have equalisation policy? It is really that some value of the fund is given to the investor, so the fund value goes down by that much per unit. It depends on the type of mutual funds. For example, there are growth type mutual funds that do not give any dividend and the total value of the fund is reflected in its price. Do the companies whose stocks we owned directly apply equalisation policy on their dividends as well? Why not? As far a stock price is concerned, it usually decrease by the same amount of the dividend payout at ex-date, so in effect, the market in a way does the equalization, the company directly does not do it.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Historical Stock Price Quote on delisted stock without knowing stock symbol as of quote date
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<|im_start|>assistant
You need a source of delisted historical data. Such data is typically only available from paid sources. According to my records 20 Feb 2006 was not a trading day - it was Preisdent's Day and the US exchanges were closed. The prior trading date to this was 17 Feb 2006 where the stock had the following data: Open: 14.40 High 14.46 Low 14.16 Close 14.32 Volume 1339800 (consolidated volume) Source: Symbol NVE-201312 within Premium Data US delisted stocks historical data set available from http:\/\/www.premiumdata.net\/products\/premiumdata\/ushistorical.php Disclosure: I am a co-owner of Norgate \/ Premium Data.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Facebook buying WhatsApp for 19 Billion. How are existing shareholders affected?
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<|im_start|>assistant
The answer to your question has to do with the an explanation of "shares authorized, issued and outstanding." Companies, in their Articles of Incorporation, specify a maximum number of shares they are authorized to issue. For example purposes let's assume Facebook is authorized to issue 100 shares. Let's pretend they have actually issued 75 shares, but only 50 are outstanding (aka Float, i.e. freely trading stock in the market) and stock options total 25 shares. So if someone owns 1 share, what percentage of Facebook do they own? You might think 1\/100, or 1%; you might think 1\/75, or 1.3%; or you might think 1\/50, or 2%. 2% is the answer, but only on a NON-diluted basis. So today someone who owns 1 share owns 2% of Facebook. Tomorrow Facebook announces they just issued 15 shares to Whatsapp to buy the company. Now there are 65 shares outstanding and 90 issued. Now someone who owns 1 share of Facebook own only 1\/65, or 1.5% (down from 2%)! P.S. "Valuation" can be thought of as the price of the stock at the time of the purchase announcement.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Definition of "secular" in the context of markets?
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<|im_start|>assistant
According to Wikipedia: In the finance industry, something done on a secular basis is done on a long-term basis, not a temporary or cyclical one, with a time frame of "10–50 years or more" Source
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is there a free, online stock screener for UK stocks?
<|im_end|>
<|im_start|>assistant
I use and recommend barchart.com. Again you have to register but it's free. Although it's a US system it has a full listing of UK stocks and ETFs under International > London. The big advantage of barchart.com is that you can do advanced technical screening with Stochastics and RS, new highs and lows, moving averages etc. You're not stuck with just fundamentals, which in my opinion belong to a previous era. Even if you don't share that opinion you'd still find barchart.com useful for UK stocks.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Do other countries have the equivalent of Australia's Negative Gearing?
<|im_end|>
<|im_start|>assistant
I would say similar rules apply in the US. If you have a net loss from rental property, you certainly can claim that loss against your personal income. There are various rules around this though that make it a bit less clear cut. If you are a "real estate professional", which basicly means you spend at least 750 hours per year working on your rental properties (or related activities), then all losses are deductible against any other ordinary income you have. If you aren't a "real estate professional", then your rental income is considered a "passive activity" and losses you can count against regular income are limited to $25,000 per year (with a carry-forward provision) and begin to phase out entirely if your income is between $100,000 and $150,000. So, the law here is structured to allow most small-time investors to take rental real estate losses against their ordinary income, but the income phase-out provision is designed to prevent the wealthy from using rental property losses to avoid taxation.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Transferring money from One business checking to another business checking
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<|im_start|>assistant
You should have separate files for each of the two businesses. The business that transfers money out should "write check" in its QB file. The business that receives money should "make deposit" in its QB file. (In QB you "write check" even when you make the payment by some other means like ACH.) Neither business should have the bank accounts of the other explicitly represented. On each side, you will also need to classify the payment as having originated from \/ gone to some other account - To know what's correct there, we'd need to know why your transferring the money in the first place and how you otherwise have your books established. I think that's probably beyond the scope of what's on-topic \/ feasible here. Money into your business from your personal account is probably owner's equity, unless you have something else going on. For example, on the S Corp you should be paying yourself a salary. If you overpay by accident, then you might write a check back to the company from your personal account to correct the mistake. That's not equity - It's probably a "negative expense" in some other account that tracks the salary payments.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is inflation a good or bad thing? Why do governments want some inflation?
<|im_end|>
<|im_start|>assistant
In general the consensus is that a small amount of inflation (usually 1.5-2% per year) is desirable. That is why the Federal Reserve sets its inflation target in that range. The reasons why are quite complex though. One reason is "wage stickiness" - ie., the observed phenomenon that employers don't like to cut wages. Having a small rate of inflation means that when wages are steady in nominal terms, they are actually falling in real terms. This gives employers more flexibility.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What differentiates index funds and ETFs?
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<|im_start|>assistant
Index Funds & ETFs, if they are tracking the same index, will be the same in an ideal world. The difference would be because of the following factors: Expense ratio: i.e. the expense the funds charge. This varies and hence it would lead to a difference in performance. Tracking error: this means that there is a small percentage of error between the actual index composition and the fund composition. This is due to various reasons. Effectively this would result in the difference between values. Demand \/ Supply: with ETFs, the fund is traded on stock exchanges like a stock. If the general feeling is that the index is rising, it could lead to an increase in the price of the ETF. Index funds on the other hand would remain the same for the day and are less liquid. This results in a price increase \/ decrease depending on the market. The above explains the reason for the difference. Regarding which one to buy, one would need to consider other factors like: a) How easy is it to buy ETFs? Do you already hold Demat A\/C & access to brokers to help you conduct the transaction or do you need to open an additional account at some cost. b) Normally funds do not need any account, but are you OK with less liquidity as it would take more time to redeem funds.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What can I replace Microsoft Money with, now that MS has abandoned it?
<|im_end|>
<|im_start|>assistant
Well, you could replace it with.. itself! Microsoft Money Plus Sunset versions The Microsoft Money Plus Sunset versions are replacements for expired versions of Microsoft Money Essentials, Deluxe, Premium, and Home and Business. They allow existing customers to use MoneyPlus to continue accessing their data. Changes to the new versions include file conversions from older versions of Money, no required activation, no online services and no assisted support. Microsoft Money Plus Sunset is available now. Download at: http:\/\/www.microsoft.com\/money\/sunset.mspx
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How to interpret a big ask size?
<|im_end|>
<|im_start|>assistant
Yes, but it must be remembered that these conditions only last for instants, and that's why only HFTs can take advantage of this. During 2\/28\/14's selloff from the invasion of Ukraine, many times, there were moments where there was overwhelming liquidity on the bid relative to the ask, but the price continued to drop.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
If the U.S. defaults on its debt, what will happen to my bank money?
<|im_end|>
<|im_start|>assistant
Government default doesn't mean that all US money is immediately worthless. First, the bondholders will get stiffed. Following that, interest rates will shoot up (because the US is a bad credit risk at this point) and the government will monetize its ongoing expenses -- i.e., fire up the printing presses. If you're concerned about not having access to your money, start pulling out a little extra when you get cash at an ATM. Build it up over time until you have enough currency to weather through whatever emergency you envision with your bank account.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
If I'm cash-flow negative, should I dollar-cost-average the money from my bonus over the entire year?
<|im_end|>
<|im_start|>assistant
You will maximize your expected wealth by investing all the money you intend to invest, as soon as you have it available. Don't let the mythos of dollar cost averaging induce you to allocate more much money to a savings account than is optimal. If you want the positive expected return of the market, don't put your money in a savings account. That's especially true now, when you are certainly earning a negative real interest rate on your savings account. Dollar cost averaging and putting all your money in at the beginning would have the same expected return except that if you put all your money in earlier, it spends more time in the market, so your expected return is higher. Your volatility is also higher (because your savings account would have very low volatility) but your preference for investment tells me that you view the expected return and volatility tradeoff of the stock market as acceptable. If you need something to help you feel less stress about investing right away, think of it as dollar cost averaging on a yearly basis instead of monthly. Further, you take take comfort in knowing that you have allocated your wealth as you can instead of letting it fizzle away in real terms in a bank account.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Any advantage to exercising ISO's in company that is not yet public?
<|im_end|>
<|im_start|>assistant
As I recall from the documentation presented to me, any gain over the strike price from an ISO stock option counts as a long term capital gain (for tax purposes) if it's held from 2 years from the date of grant and 1 year from the date of exercise. If you're planning to take advantage of that tax treatment, exercising your options now will start that 1-year countdown clock now as well, and grant you a little more flexibility with regards to when you can sell in the future. Of course, no one's renewed the "Bush tax cuts" yet, so the long-term capital gains rate is going up, and eventually it seems they'll want to charge you Medicare on those gains as well (because they can... ), soo, the benefit of this tax treatment is being reduced... lovely time to be investing, innnit?
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
I want to invest in Gold. Where do I go and buy it?
<|im_end|>
<|im_start|>assistant
You can buy from any of the well known jewelry shops. Or you can even buy it from banks. For a 24carat gold purchase, you would normally also get a certificate attesting the quality of the gold item. Also while selling your gold, you can sell to above mentioned jewellers or any decent jeweller as a matter of fact.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Has anyone created a documentary about folks who fail to save enough for retirement?
<|im_end|>
<|im_start|>assistant
Since your question was first posted, I happened to watch PBS FRONTLINE's The Retirement Gamble, about "America's Retirement Crisis" and the retirement industry. You can watch the entire episode online at the previous link, and it's also available on DVD. Here's a link to the episode transcript. Here's a partial blurb from a post at PBS that announced the episode: If you’ve been watching any commercial television lately, you are well aware that the financial services industry is very busy running expensive ads imploring us to worry about our retirement futures. Open a new account today, they say. They are not wrong that we should be doing something: America is facing a retirement crisis. One in three Americans has no retirement savings at all. One in two reports that they can’t save enough. On top of that, we are living longer, and health care costs, as we all know, are increasing. But, as I found when investigating the retirement planning and mutual funds industries in The Retirement Gamble, which airs tonight on FRONTLINE, those advertisements are imploring us to start saving for one simple reason. Retirement is big business — and very profitable. (... more... ) There's another related PBS FRONTLINE documentary from back in 2006, Can You Afford To Retire? You'll find a link on that page to watch the program online. Finally, I'm also aware of but haven't yet seen a new documentary called Broken Eggs: The Looming Retirement Crisis in America. Looks like it isn't available for online streaming or on DVD yet, but I expect it would be, eventually.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
If I own x% of company A, and A buys company B, do I own x% of B?
<|im_end|>
<|im_start|>assistant
No, thanks to the principle of corporate personhood. The legal entity (company C) is the owner and parent of the private company (sub S). You and C are separate legal entities, as are C and S. This principle helps to legally insulate the parties for purposes such as liability, torts, taxes, and so forth. If company C is sued, you may be financially at stake (i.e. your investment in C is devalued or made worthless) but you are not personally being sued. However, the litigant may attach you as an additional litigant if the facts of the suit merit it. But without legal separateness of corporations, then potentially all owners and maybe a number of the employees would be sued any time somebody sued the business - which is messy for companies and messy for litigants. It's also far cleaner for lenders to lend to unified business entities rather than a variety of thousands of ever-shifting shareholders. Note that this is a separate analysis that assumes the companies are not treated as partnerships or disregarded entities (tax nothings) for tax purposes, in which case an owner may for some purposes be imputed to own the assets of C. I've also ignored the consolidated tax return, which would allow C and S to file a type of corporate joint return that for some purposes treats them similarly to common entity. For the simplest variation of your question, the answer is no. You do not own the assets of a corporation by virtue of owning a few of its shares. Edit: In light of your edit to include FB and Whatsapp, and the wrinkle about corporate books. If sub S is 100% owned by company C, then you do not have any inspection rights to S because you are not a shareholder. You also do not have virtual corporation inspection rights through company C. However, if a person has inspection rights to company C, and sub S appears on the books and financial records of C, then your C rights will do the job of seeing S information. However, Facebook is a public company, so they will make regular public filings and disclosures that should at least partly cover Whatsapp. So I hedge and clear my throat by averring that my securities training is limited, but I believe that the SEC filings of a public company will as a practical matter (maybe a matter of law?) moot the inspection rights. At the very least, I suspect you'd need a proper purpose (under DGCL, for example), to demand the inspection, and they will have already made extensive disclosures that I believe will be presumptively sufficient. I defer to more experienced securities experts on that question, but I don't believe inspection rights are designed for public companies.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Should I pay off my student loans or keep it in the bank? [duplicate]
<|im_end|>
<|im_start|>assistant
Many years ago I heard a multi-level marketing pitch that pointed out how many doctors don't get out of debt until they are well into their 50's. The selling point was that you can get rich quick, as rich as a doctor, with nothing more then a bit of elbow grease. Of course the pitch failed to mention that most doctors, buy the things doctors buy, when they get that first big job. The big house, expensive cars nerf the income that they receive and they are probably stuck with years of student loan payments. I assume that you are one of the "lucky" ones that have graduated college with a well paying job. By lucky I mean you concentrated on obtaining a skill for which the marketplace has a need. Why not continue to live like a college student for a few more months and pay off all of your student loans ASAP? Get rid of them like you were purging the phone number of that high maintenance girl you dated during a short time of insanity.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Can a Line of Credit be re-financed? Is it like a mortgage, with a term?
<|im_end|>
<|im_start|>assistant
HELOCs typically have a 10 year draw and 5 year payback. During the draw time you can pay interest only if you wish. The rate can range from Prime minus 1.5 to Prime plus (quite a bit). Of course, you can always shop around for a better deal than you currently have so long as you have equity in your home.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is it possible to improve stock purchase with limit orders accounting for volatility?
<|im_end|>
<|im_start|>assistant
If you can afford the cost and risk of 100 shares of stock, then just sell a put option. If you can only afford a few shares, you can still use the information the options market is trying to give you -- see below. A standing limit order to buy a stock is essentially a synthetic short put option position. [1] So deciding on a stock limit order price is the same as valuing an option on that stock. Options (and standing limit orders) are hard to value, and the generally accepted math for doing so -- the Black-Scholes-Merton framework -- is also generally accepted to be wrong, because of black swans. So rather than calculate a stock buy limit price yourself, it's simpler to just sell a put at the put's own midpoint price, accepting the market's best estimate. Options market makers' whole job (and the purpose of the open market) is price discovery, so it's easier to let them fight it out over what price options should really be trading at. The result of that fight is valuable information -- use it. Sell a 1-month ATM put option every month until you get exercised, after which time you'll own 100 shares of stock, purchased at: This will typically give you a much better cost basis (several dollars better) versus buying the stock at spot, and it offloads the valuation math onto the options market. Meanwhile you get to keep the cash from the options premiums as well. Disclaimer: Markets do make mistakes. You will lose money when the stock drops more than the option market's own estimate. If you can't afford 100 shares, or for some reason still want to be in the business of creating synthetic options from pure stock limit orders, then you could maybe play around with setting your stock purchase bid price to (approximately): See your statistics book for how to set ndev -- 1 standard deviation gives you a 30% chance of a fill, 2 gives you a 5% chance, etc. Disclaimer: The above math probably has mistakes; do your own work. It's somewhat invalid anyway, because stock prices don't follow a normal curve, so standard deviations don't really mean a whole lot. This is where market makers earn their keep (or not). If you still want to create synthetic options using stock limit orders, you might be able to get the options market to do more of the math for you. Try setting your stock limit order bid equal to something like this: Where put_strike is the strike price of a put option for the equity you're trading. Which option expiration and strike you use for put_strike depends on your desired time horizon and desired fill probability. To get probability, you can look at the delta for a given option. The relationship between option delta and equity limit order probability of fill is approximately: Disclaimer: There may be math errors here. Again, do your own work. Also, while this method assumes option markets provide good estimates, see above disclaimer about the markets making mistakes.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Reconciling transactions reimbursing myself for expenses as self-employed (UK)
<|im_end|>
<|im_start|>assistant
For anyone that's curious, I had a number of chats with Quickbooks who recommended I import only the relevant business transactions from my personal account & personal credit card in order to lower the tax liability. This way money "paid" from the business account to myself rightly shows up as a transfer and not as income. This means when generating a tax report, it calculates the correct rate of tax to be paid based on income minus allowable expenses, regardless which account they came from.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What if 40% of the remaining 60% Loan To Value (ratio) is not paid, or the borrower wants to take only 60% of the loan?
<|im_end|>
<|im_start|>assistant
Sorry, I don't think a bounty is the issue here. You seem to understand LTV means the bank you are talking to will lend you 60% of the value of the home you wish to purchase. You can't take the dollars calculated and simply buy a smaller house. To keep the numbers simple, you can get a $600K mortgage on a $1M house. That's it. You can get a $540K mortgage on a $900K house, etc. Now, 60% LTV is pretty low. It might be what I'd expect for rental property or for someone with bad or very young credit history. The question and path you're on need to change. You should understand that the 'normal' LTV is 80%, and for extra cost, in the form of PMI (Private Mortgage Insurance) you can even go higher. As an agent, I just sold a home to a buyer who paid 3% down. The way you originally asked the question has a simple answer. You can't do what you're asking.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What are the real risks in "bio-technology" companies?
<|im_end|>
<|im_start|>assistant
Be wary of pump and dump schemes. This scheme works like this: When you observe that "From time to time the action explodes with 100 or 200% gains and volumes exceeding one million and it then back down to $ 0.02", it appears that this scheme was performed repeatedly on this stock. When you see a company with a very, very low stock price which claims to have a very bright future, you should ask yourself why the stock is so low. There are professional stock brokers who have access to the same information you have, and much more. So why don't they buy that stock? Likely because they realize that the claims about the company are greatly exaggerated or even completely made up.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What makes an actual share valuable? [duplicate]
<|im_end|>
<|im_start|>assistant
What benefit do I get from buying a share The value of any financial asset is its ability to generate cash in the future, and thus the "value" of a share is heavily influenced by the dividends it pays and the equity value. The equity value can be calculated different ways. Two common ways are to just take "book" value, meaning assets - liabilities, or you can look at the projected free cash flows of the company discounted back to the present time. Voting rights don't typically influence a share price except in hostile takeover scenarios (meaning someone buys up a lot of shares to have more influence in company decisions)
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
When is it necessary to apply taxes for web freelancing services in Quebec, Canada?
<|im_end|>
<|im_start|>assistant
AFAIK, there are two kinds of taxes your web freelancing income may be subject to in Quebec: On the income taxes: The net income you realize from your web freelancing activities would be considered taxable income. Assuming you are not operating as an incorporated business, you would need to declare the freelancing income on both your federal and provincial tax returns. You should be able to deduct certain costs related to your business – for instance, if you paid for software, hosting, domain name registration, etc. That is, only the profit from your business would be subject to income tax. With income and expenses arising from self-employment, you may want to use a professional to file your taxes. On the sales taxes: You may also need to charge federal GST and provincial QST (Quebec Sales Tax) on your services: You must enroll and charge GST and QST once you exceed the "small supplier" revenue threshold of $30,000 measured over four consecutive quarters. (You can still choose to enroll for GST\/QST before you reach that amount, but over that amount enrollment becomes mandatory. Some businesses enroll before the threshold is reached so they can claim input tax credits for tax paid on expenses, but then there's more paperwork – one reason to perhaps avoid enrolling until necessary.) In Quebec, the Ministère du Revenu du Québec administers both GST (on behalf of the federal government) as well as provincial QST. Be sure to also check out their informative booklet, Should I Register with Revenu Quebec? (PDF). See also General Information Concerning the QST and the GST\/HST (PDF).
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is Amazon's offer of a $50 gift card a scam?
<|im_end|>
<|im_start|>assistant
Amazon has 2 different cards you can apply for, a store card and a credit card. The credit card is through Chase. The deal is not a scam, I can confirm this because I applied for their credit card and got $70 in the form of a digital gift card. By giving customers free money for signing up for their cards they get more people who are willing to give it a try. Once you have a card, you get benefits like 3-5 percent back on Amazon purchases that will entice consumers to use the card. Amazon likely has an agreement with Chase and they are hoping to get you hooked with the free money and benefits.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
mortgage vs car loan vs invest extra cash?
<|im_end|>
<|im_start|>assistant
Pay off your car loan. Here is why: As you mentioned, the interest on your home mortgage is tax deductible. This may not completely offset the difference in interest between your two loans, but it makes them much closer. Once your car debt is gone, you have eliminated a payment from your life. Now, here's the trick: take the money that you had been paying on your car debt, and set it aside for your next car. When the time comes to replace your car, you'll be able to pay cash for your car, which has several advantages.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
"Inflation actually causes people not to spend"… could it be true?
<|im_end|>
<|im_start|>assistant
Inflation can go up for a number of reasons. Boom times can cause inflation, as everyone is making and spending a lot of money, so prices and inflation goes up. In times like these central banks usually increase interest rates to curb spending and thus bring down inflation. By raising interest rates the central bank is increasing the cost of borrowing money. So with high prices and a higher cost to borrowing money, most people start reducing their spending. When this happens businesses sell less stock and have increased costs (due to higher interest rates) so have to lay off staff or reduce their hours at work, so people will have even less money to spend. This causes prices to fall and reduces inflation and can result in a recession. At this point in time central banks start reducing interest rates to make the cost of borrowing money cheaper and stimulate people to start spending again. And so the cycle continues. The result in this case is that inflation itself didn't kerb demand, but was helped along by the central bank rising interest rates. Another reason causing inflation can be a restriction on the supply of certain goods or services. An example we went through about 2 years ago was when floods caused banana crops up in Northern Australia to be devastated. This caused a lack of supply in bananas for almost a year across Australia. The normal price for bananas here is between $1 to $3 per kg. During this period banana prices skyrocketed up to $14 per kg. The result: very few were buying bananas. So the increase in price here caused a reduction in demand directly.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What kind of technical analysis and indicators available for mutual fund navs
<|im_end|>
<|im_start|>assistant
A general mutual fund's exact holdings are not known on a day-to-day basis, and so technical tools must work with inexact data. Furthermore, the mutual fund shares' NAV depends on lots of different shares that it holds, and the results of the kinds of analyses that one can do for a single stock must be commingled to produce something analogous for the fund's NAV. In other words, there is plenty of shooting in the dark going on. That being said, there are plenty of people who claim to do such analyses and will gladly sell you their results (actually, Buy, Hold, Sell recommendations) for whole fund families (e.g. Vanguard) in the form of a monthly or weekly Newsletter delivered by US Mail (in the old days) or electronically (nowadays). Some people who subscribe to such newsletters swear by them, while others swear at them and don't renew their subscriptions; YMMV.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is there a term for the risk of investing in an asset with a positive but inferior return?
<|im_end|>
<|im_start|>assistant
Opportunity cost is the term you're looking for. I.e. (quoting from link) Definition of 'Opportunity Cost' 1. The cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What happens if I just don't pay my student loans?
<|im_end|>
<|im_start|>assistant
Let me give you some advice from someone who has experience at both ends - had student loan issues myself and parents ran financial aid department at local university. Quick story of my student loan. I graduated in debt and could not pay at first due to having kids way too early. I deferred. Schools will have rules for deference. There are also federal guidelines - lets not get specific on this though since these change every year it seems. So basically there is an initial deferment period in which any student can request for the repayments to be deferred and it is granted. Then there is an extended deferment. Here someone has to OK it. This is really rather arbitrary and up to the school\/lender. My school decided to not extend mine after I filled out a mound of paperwork and showed that even without paying I had basically $200 a month for the family to live off past housing\/fixed expenses. Eventually they had to cave, because I had no money so they gave me an extended deferment. After the 5 years I started paying. Since my school had a very complex way to pay, I decided to give them 6 months at a time. You would think they would love that right? (On the check it was clearly stated what months I was paying for to show that I was not prepaying the loan off) Well I was in collections 4 months later. Their billing messed up, set me up for prepayment. They then played dumb and acted like I didn't but I had a picture of the check and their bank's stamp on the back... They couldn't get my loan out of collections - even though they messed up. This is probably some lower level employee trying to cover their mistake. So this office tells creditors to leave me alone but I also CANNOT pay my loan because the credit collection agency has slapped a 5k fee on the 7k loan. So my loan spent 5 years (kid you not) like this. It was interest free since the employee stopped the loan processing. Point being is that if you don't pay the lender will either put your loan into deferment automatically or go after you. MOST (not all) schools will opt for deferment, which I believe is 2 years at most places. Then after that you have the optional deferment. So if you keep not paying they might throw you into that bucket. However if you stop paying and you never communicate with them the chances of you getting the optional deferment are almost none - unless school doesn't know where you live. Basically if you don't respond to their mail\/emails you get swept into their credit collection process. So just filling out the deferment stuff when you get it - even if they deny it - could buy you up to 10 years - kid you not. Now once you go into the collection process... anything is game. As long as you don't need a home\/car loan you can play this game. What the collection agency does depends on size of loan and the rules. If you are at a "major" university the rules are usually more lax, but if you are at the smaller schools, especially the advertised trade\/online schools boom - better watch out. Wages will be garnished very soon. Expect to go to court, might have to hire an attorney because some corrupt lenders start smacking on fees - think of the 5k mine smacked on me. So the moral of the story is you will pay it off. If you act nice, fill out paperwork, talk to school, and so on you can probably push this off quite a few years. But you are still paying and you will pay interest on everything. So factor in that to the equation. I had a 2.3% loan but they are much higher now. Defaulting isn't always a bad thing. If you don't have the money then you don't have it. And using credit cards to help is not the thing to do. But you need to try to work with the school so you don't incur penalties\/fees and so that your job doesn't have creditors calling them. My story ended year 4 that my loan was in collection. A higher up was reviewing my case and called me. Told her the story and emailed her a picture of their cashed check. She was completely embarrassed when she was trying to work out a plan for me and I am like - how about I come down tomorrow with the 7k. But even though lender admitted fault this took 20+ calls to agencies to clear up my credit so I could buy a house. So your goal should be:
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
My Co-Signer is the Primary Account Holder for my Car Loan - Does this affect my credit?
<|im_end|>
<|im_start|>assistant
It sounds like your father got a loan and you are making the payments. If your name and SSN are not on the loan then you are not getting credit for making the payments your father is. So it will not affect your credit. If you are on the loan as a secondary borrower it will affect your credit but not substantially on the positive but could affect it substantially on the negative side. Since your father is named as the primary borrower you will probably need to talk with him about it first. If this is a mistake the 2 of you will need to work together with the bank to get it corrected. Since your father is currently listed first the bank is probably going to be unable(even if they are willing) to make a change to the loan now with out his explicit permission. In addition if the loan is in your fathers name, if it is a vehicle loan, then the car is most likely in your fathers name as well. Most states require that the primary signatory on a vehicle loan also be the primary owner on the title to the vehicle. If your fathers name is the primary name on the title then you would have to retitle the car to refinance in your name.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Should I take a personal loan for my postgraduate studies?
<|im_end|>
<|im_start|>assistant
If you are eligible for FEE-HELP then this is by far the cheapest way of financing higher education in Australia.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Why diversify stocks\/investments?
<|im_end|>
<|im_start|>assistant
Any investor can make a bad bet, even Buffett. Even if you have done every bit of research on an investment possible you are exposed to random external events.. acts of god, and outright fraud.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is Amazon's offer of a $50 gift card a scam?
<|im_end|>
<|im_start|>assistant
These kinds of credit card offers are incredibly common. More often you will get a certain reward if you spend $X within Y days of getting the card. In many cases you can take advantage of them with very little downside. However, are you responsible enough to have a credit card and be able to pay off the balance every month? If not the interest charges could quickly wipe out the $50 bonus you get. And hard inquiries and new accounts could potentially affect your credit score, particularly if you don't have a well-established credit history. There's also the chance you get denied in which case you add a hard inquiry to your credit report for no gain.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is there any downside to using temporary credit card numbers with subscription services?
<|im_end|>
<|im_start|>assistant
If you've agreed to pay the money, then you owe them whether they have a valid credit card number of yours or not. If they want to report your debt to a collections agency and\/or credit bureau, they can. Which would suck for you. It may not be that likely over $9.99 or whatever, but my point is that it's still a small risk even with a temporary card number.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
How to invest with a low net worth
<|im_end|>
<|im_start|>assistant
You most definitely can invest such an amount profitably, but it makes it even more important to avoid fees, um, at all costs, because fees tend to have a fixed component that will be much worse for you than for someone investing €200k. So: Edit: The above assumes that you actually want to invest in the long run, for modest but relatively certain gains (maybe 5% above inflation) while accepting temporary downswings of up to 30%. If those €2000 are "funny money" that you don't mind losing but would be really excited about maybe getting 100% return in less than 5 years, well, feel free to put them into an individual stock of an obscure small company, but be aware that you'd be gambling, not investing, and you can probably get better quotes playing Roulette.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Relative worth of investment versus spending for the economy
<|im_end|>
<|im_start|>assistant
I believe you're looking for some sort of formula that will determine how changes in savings, investing, and spending will affect economic growth. If such a formula existed (and worked) then central planning would work since a couple of people could pull some levers to encourage more savings, or more investing, or more spending - depending on what was needed at that particular time. Unfortunately, no magic formula exists and so no person has enough knowledge to determine what the proper amount of savings, investing, or spending should be at a given time. I found this resource particular helpful in describing the interactions between savings, consumption, and investing.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
How do annual risks translate into long-term risks?
<|im_end|>
<|im_start|>assistant
The short answer is the annualised volatility over twenty years should be pretty much the same as the annualised volatility over five years. For independent, identically distributed returns the volatility scales proportionally. So for any number of monthly returns T, setting the annualization factor m = 12 annualises the volatility. It should be the same for all time scales. However, note the discussion here: https:\/\/quant.stackexchange.com\/a\/7496\/7178 Scaling volatility [like this] only is mathematically correct when the underlying price model is driven by Geometric Brownian motion which implies that prices are log normally distributed and returns are normally distributed. Particularly the comment: "its a well known fact that volatility is overestimated when scaled over long periods of time without a change of model to estimate such "long-term" volatility." Now, a demonstration. I have modelled 12,000 monthly returns with mean = 3% and standard deviation = 2, so the annualised volatility should be Sqrt(12) * 2 = 6.9282. Calculating annualised volatility for return sequences of various lengths (3, 6, 12, 60 months etc.) reveals an inaccuracy for shorter sequences. The five-year sequence average got closest to the theoretically expected figure (6.9282), and, as the commenter noted "volatility is [slightly] overestimated when scaled over long periods of time". Annualised volatility for varying return sequence lengths Edit re. comment Reinvesting returns does not affect the volatility much. For instance, comparing some data I have handy, the Dow Jones Industrial Average Capital Returns (CR) versus Net Returns (NR). The return differences are somewhat smoothed, 0.1% each month, 0.25% every third month. More erratic dividend reinvestment would increase the volatility.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What publicly available software do professional stock traders use for stock analysis?
<|im_end|>
<|im_start|>assistant
Bloomberg Professional seems to be very popular. It provides any kind of data you can imagine. Analysis is a subjective interpretation of the data.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Can I get my property taxes lowered?
<|im_end|>
<|im_start|>assistant
The question is whether the assessment is in line with surrounding homes. If my 1500 sq ft house on 1\/4 acre is assessed far higher than a similar sized house\/land nearby, I'd have a case. +\/- 10% can be for age\/quality, but 25% or more, I'd investigate. mhoran is right, values for different purposes need not align. A start would be to use a service like Zillow which offers property tax information, as well as house sizes. Let us know what you discover. Welcome to Money.SE
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Should I use put extra money toward paying off my student loans or investing in an index fund?
<|im_end|>
<|im_start|>assistant
Not all debt is bad. If it carries a reasonable interest rate, you don't need to clear it immediately. As for investing in an index fund, they're an affordable, easy way to spread your money over various assets. However, asset allocation is just one of many investment strategies. Ideally, you want to invest according to your goals, tax situation, and risk tolerance. You want a portfolio that dynamically allocates to various investment strategies, both beta and alpha, according to changing market conditions. Most importantly, you want systematic risk management for every aspect of your investments.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What is the name of inverse of synergy? (finance)
<|im_end|>
<|im_start|>assistant
You could call it "multiple streams of income" a la Robert Allen and others. Or you could call it "Do once, sell many" or something like that.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is there any "Personal" Finance app that allows 2 administrators?
<|im_end|>
<|im_start|>assistant
The best solution I've been able to find for this is MoneyWiz, where both are logged into the same sync account.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
How can a person with really bad credit history rent decent housing?
<|im_end|>
<|im_start|>assistant
She can find a landlord that doesn't do credit checks. Maybe on Craigslist? She may end up paying more, have a bigger security deposit, etc. She can get someone else (not you) to sit her down and explain to her frankly that she's messing things up for herself and her children by being a poor manager of her finances. As her credit score improves, more opportunities will open up for her. Co-signing the loan is an option, but I do think you're wise not to do that.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Are credit histories\/scores international?
<|im_end|>
<|im_start|>assistant
It's not just that credit history is local; it's that it's a private business run for profit. The "big three" credit bureaus in the US are Experian, Equifax and Transunion. They collect information on debt usage and abuse from various companies in the US, and charge a fee to provide that information (and their judgement of you) to companies interested in offering you further credit. But there's nothing stopping a company from collecting international credit histories, or specialized credit histories either (for instance, there's a company called ChexSystems which focuses on retail purchase financing (mostly auto) and checking account abuse, while ignoring other types of lending). That being said, I don't know of any companies which currently collect international credit histories. Perhaps in Europe, with more nations in close geographic proximity, there would be, but not in North America.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
dividend cover ratio for stocks
<|im_end|>
<|im_start|>assistant
Profit after tax can have multiple interpretations, but a common one is the EPS (Earnings Per Share). This is frequently reported as a TTM number (Trailing Twelve Months), or in the UK as a fiscal year number. Coincidentally, it is relatively easy to find the total amount of dividends paid out in that same time frame. That means calculating div cover is as simple as: EPS divided by total dividend. (EPS \/ Div). It's relatively easy to build a Google Docs spreadsheet that pulls both values from the cloud using the GOOGLEFINANCE() function. I suspect the same is true of most spreadsheet apps. With a proper setup, you can just fill down along a column of tickers to get the div cover for a number of companies at once.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Should I pay off a 0% car loan?
<|im_end|>
<|im_start|>assistant
The precise answer depends on the terms and conditions of the loan, and whether you can reasonably expect to meet them. For example, if you keep the loan, make no payments, there is a good chance that - eventually - you will trigger a clause in the contract, and suddenly be charged fees or a significant interest rate. If you don't need to pay anything for a time, odds are you will forget to monitor the loan (after all it is not costing you anything) and suddenly get hit with an unexpected expense. Most loan contracts are structured - by professionals - to benefit the loan provider. The purpose of a loan provider is to make a profit. They do that by encouraging you to pay more - up front, over the longer term, or both. Personally, I would never take out a zero-interest loan. It is specifically designed to appear like a gift from the loan provider, while actually (and almost covertly) costing more at some point. If I was in your position (i.e. if I had taken out such a loan) I'd pay off the loan as fast as possible. If you have more than one loan, however, prioritise by working out which actually costs you more over time. And pay the worst ones first. You'll have to look closely at the terms and conditions - possibly with the help of a professional - to work out which is actually work.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
I've tracked my spending and have created a budget, now what do I do with it?
<|im_end|>
<|im_start|>assistant
I'm reminded of a conversation I had regarding food. I used the word 'diet' and got pushback, as I meant it in sense of 'what one eats'. That's what a diet is, what you eat in an average week, month, year. That list has no hidden agenda unless you want it to. If your finances are in good shape, debt under control, savings growing, etc, a budget is more of an observation than a constraint. In the same way that my bookshelf tells you a lot about who I am, books on finance, math, my religion, along with some on English and humor, my budget will also tell you what my values are. Edit - In a recent speech, regarding Joe Biden, Hillary Clinton said "He has a saying: ‘Don’t tell me what you value. Show me your budget and I will tell you what you value.’ " - nearly exactly my thoughts on this. For the average person, a budget helps to reign in the areas where spending is too high. $500\/mo eating out? For the couple hacking away at $30k in credit card debt, that would be an obvious place to cut back. If this brings you happiness, there's little reason to cut back. The budget becomes a reflection of your priorities, and if, at some point in the future, you need to cut back, you'll have a good understanding of where the money is going.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What are some sources of information on dividend schedules and amounts?
<|im_end|>
<|im_start|>assistant
Yahoo Finance is definitely a good one, and its ultimately the source of the data that a lot of other places use (like the iOS Stocks app), because of their famous API. Another good dividend website is Dividata.com. It's a fairly simple website, free to use, which provides tons of dividend-specific info, including the highest-yield stocks, the upcoming ex-div dates, and the highest-rated stocks based on their 3-metric rating system. It's a great place to find new stocks to investigate, although you obviously don't want to stop there. It also shows dividend payment histories and "years paying," so you can quickly get an idea of which stocks are long-established and which may just be flashes in the pan. For example: Lastly, I've got a couple of iOS apps that really help me with dividend investing: Compounder is a single-stock compound interest calculator, which automatically looks up a stock's info and calculates a simulated return for a given number of years, and Dividender allows you to input your entire portfolio and then calculates its growth over time as a whole. The former is great for researching potential stocks, running scenarios, and deciding how much to invest, while the latter is great for tracking your portfolio and making plans regarding your investments overall.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
How long should I keep an uncleared transaction in my checkbook?
<|im_end|>
<|im_start|>assistant
Typically I'll carry the charge for quite awhile, up to a year. If it hasn't cleared by then, I contact the institution that should have received the money to see what they want to do about it. If they tell me not to worry about it, then I change the payee to be "Overdraft Protection", and consider it as having been spent. That way I build up (slowly) a cushion in my checking account.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What is a subsidy?
<|im_end|>
<|im_start|>assistant
Subsidy usually means gratuitous financial support. For example, if for whatever reason you live much below the living average paying utility services in full might be too expensive - you'll be out of money before you even think of buying food and basic clothes. Yet it's clear that once can't live in a city without utility services. So the government might have a program for subsidizing utility services for people with very low income - a person brings in proof of low income and once it is low enough government will step in and pay that person utility services in full or in part depending on actual income he proves. The same can be organized for anything government or some organization wishes to support for whatever reason. The key idea is someone gives you free money for spending on some specific purpose.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Is Mint allowed to share user data with other Intuit entities?
<|im_end|>
<|im_start|>assistant
I wound up asking Mint over email so I'll share the answer I received: Thank you for contacting Mint.com. From my understand you want to know if Mint can transfer data to other Intuit products and vice versa. Let me address your concern based from what I can see on my tools. Upon confirming, while Mint and other Intuit products are under the same company, Mint.com is not yet integrated to other Intuit products. We’d like to thank you though for giving the idea to us. With this, we would know which future enhancements will our customers appreciate. We have forwarded your request\/suggestion to our Product and Development team for their review. At this time though, we can't make any guarantee that your request\/suggestion will get implemented as we must balance customer demand with resources and business objectives. Oops...
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Under what circumstance will the IRS charge you a late-payment penalty for taxes?
<|im_end|>
<|im_start|>assistant
The IRS provides a little more information on the subject on this FAQ: Will I be charged interest and penalties for filing and paying my taxes late?: If you did not pay your tax on time, you will generally have to pay a late-payment penalty, which is also called a failure to pay penalty. Some guidance on what constitutes "reasonable cause" is found on the IRS page Penalty Relief Due to Reasonable Cause: The IRS will consider any sound reason for failing to file a tax return, make a deposit, or pay tax when due. Sound reasons, if established, include: Note: A lack of funds, in and of itself, is not reasonable cause for failure to file or pay on time. However, the reasons for the lack of funds may meet reasonable cause criteria for the failure-to-pay penalty. In this article from U.S. News and World Report, it is suggested that the IRS will generally waive the penalty one time, if you have a clean tax history and ask for the penalty to be waived. It is definitely worth asking them to waive the penalty.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
What is the next step to collect money after a judgment has been ignored?
<|im_end|>
<|im_start|>assistant
Do you have the following information? If the above conditions are met, you can use the county sheriff department to put a lien on his bank account. You can also garnish wages if he has a job but you don't know all of the above.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Wash Sales and Day Trading
<|im_end|>
<|im_start|>assistant
Yes, an overall $500 loss on the stock can be claimed. Since the day trader sold both lots she acquired, the Wash Sale rule has no net impact on her taxes. The Wash Sale rule would come into play if within thirty days of second sale, she purchased the stock a third time. Then she would have to amend her taxes because claiming the $500 loss would no longer be a valid under the Wash Sale rule. It would have to be added to the cost basis of the most recent purchase.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Mortgage vs. Cash for U.S. home buy now
<|im_end|>
<|im_start|>assistant
I wondered about this problem too, so I looked into the maths and made this app :- http:\/\/demonstrations.wolfram.com\/BuyOrRentInvestmentReturnCalculator\/ (It uses the free Wolfram computable-document format (CDF) Player.) If you try it out you can see what conditions favour renting vs buying. My own conclusion was to aim to buy a property outright upon reaching retirement age, if not sooner. Example This example compares buying a £400,000 house with renting for £1,000 a month while depositing equivalent amounts (in savings) to total the same monthly outgoings as the buyer. Mortgage rate, deposit rate, property appreciation and rent inflation can be variously specified. The example mortgage term is 20 years. As you can see the buyer and renter come out about even after the mortgage term, but the buyer comes off better after that, (having no more mortgage to pay). Of course, the rent to live in a £400,000 house would probably be more than £1,000 but this case shows an equivalence point.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How does Yahoo finance adjust stock data for splits and dividends?
<|im_end|>
<|im_start|>assistant
For stock splits, let's say stock XYZ closed at 100 on February 5. Then on February 6, it undergoes a 2-for-1 split and closes the day at 51. In Yahoo's historical prices for XYZ, you will see that it closed at 51 on Feb 6, but all of the closing prices for the previous days will be divided by 2. So for Feb 5, it will say the closing price was 50 instead of 100. For dividends, let's say stock ABC closed at 200 on December 18. Then on December 19, the stock increases in price by $2 but it pays out a $1 dividend. In Yahoo's historical prices for XYZ, you will see that it closed at 200 on Dec 18 and 201 on Dec 19. Yahoo adjusts the closing price for Dec 19 to factor in the dividend.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Simple and safe way to manage a lot of cash
<|im_end|>
<|im_start|>assistant
As your question appears in the second half, so will my answer. Like you, I will provide some background. I remember buying gasoline for $1.759 per gallon. I am so old that I remember buying gasoline for $0.759 per gallon. I recently paid $2.759 per gallon. You claim that your relative is not getting a very good return. Some would suggest that, at $2.759 per gallon, I am not getting a very good price on gasoline. Rates, yields, returns and the price of gas are not what they once were. It is actually difficult to get a pretty bad return relative to the current market. I suspect your relative is no longer getting what he used to get but he is getting a fair return. About record keeping. Your Uncle Sam benefits at your expense when you keep poor records. There are substantial penalties for failing to report everything. Most high school graduates can manage one checking account, one savings account, several charge cards and about 20 CDs and stocks at different institutions with little more than the following: a) a wall calendar b) a shoe box and c) a stack of 3 by 5 cards. Don't misplace the shoe box. If you can use a spreadsheet, it is even easier. Backup your data. There are a several reasons why you shouldn't consolidate all his cash and put it in a single mutual fund account and then put together a mix of investments that work well for him. - you are doing it backwards 1st put together a mix of investments that work well for him 2nd consolidate the assets. Your phrasing suggests a general lack of understanding - most CDs have penalties for early withdrawal. - while you enjoy managing your 401K in a single online account, your older relative might not be as comfortable with a lack of paper statements (see shoe box above) Let me tell you a little about my 401K. x% blue chip, y% small cap, z% bonds, w% foreign stock. Once a quarter, I change my current contribution to re-balance current value towards my target percentages. Every 30 months or so, I consider changing my asset allocation. The allocation considers my age, my spouses age, our childrens ages, my risk tolerance and my intermediate view of the markets. Your mileage my vary. to recap
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How does start-up equity end up paying off?
<|im_end|>
<|im_start|>assistant
In the real world, there are only two times you'll see that 5% become worth anything - ie, something you can exchange for cash - 1) if another company buys them; (2) if they go public. If neither of these things happen, you cannot do anything with the stock or stock options that you own.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How exactly does a country devalue its currency?
<|im_end|>
<|im_start|>assistant
Currencies that are pegged or fixed require that foreign currencies are held by the central issuer at a proportional amount. This is analogous to having a portfolio of currencies that the central bank issues shares from - in the form of its own currency. We will continue with this analogy, if the central bank says these "shares" are worth $1, but the underlying components of the portfolio are worth $0.80 and decreasing, then it is expensive for the central bank to maintain its peg, and eventually they will have to disregard the peg as people start questioning the central bank's solvency. (People will know the $1 they hold is not really worth what the central bank says it is, because of the price changes people experience in buying goods and services, especially when it comes to imports. Shadow economies will also trade using a currency more reflective of labor, which happens no matter what the government's punishments are for doing so). Swiss National Bank (central bank) did this in early 2015, as it experienced volatility in the Euro which it had previously been trying to keep it's currency pegged to. It became too expensive for it to keep this peg on its own. The central bank can devalue its currency by adjusting the proportions of the reserve, such as selling a lot of foreign currency X, buying more of currency Y. They can and do take losses doing this. (Swiss National Bank is maintaining a large loss) They can also flood their economy with more of their currency, diluting the value of each individual 1 dollar equivalent. This is done by issuing bonds or monetizing goods and services from the private sector in exchange for bonds. People colloquially call this "printing money" but it is a misnomer in this day and age where printers are not relevant tools. The good and service goes onto the central bank's balance book, and the company\/entity that provided the service now has a bond on its book which can be immediately sold to someone else for cash (another reading is that the bond is as good as cash). The bond didn't previously exist until the central bank said it did, and central banks can infinitely exchange goods and services for bonds. Bond monetization (also called Quantitative Easing) is practiced by the Federal Reserve in the United States, Bank of Japan, European Central Bank and now the Central Bank of the Republic of China
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
income tax for purchased\/sold short term & long term shares
<|im_end|>
<|im_start|>assistant
No Tax would have been deducted at the time of purchase\/sale of shares. You would yourself be required to compute your tax liability and then pay taxes to the govt. In case the shares sold were held for less than 1 year - 15% tax on capital gains would be levied. In case the shares sold were held for more than 1 year - No Tax would be levied and the income earned would be tax free. PS: No Tax is levied at the time of purchase of shares and Tax is only applicable at the time of sale of shares.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is it worth investing in Index Fund, Bond Index Fund and Gold at the same time?
<|im_end|>
<|im_start|>assistant
Taking into account that you are in Cyprus, a Euro country, you should not invest in USD as the USA and China are starting a currency war that will benefit the Euro. Meaning, if you buy USD today, they will be worth less in a couple of months. As for the way of investing your money. Look at it like a boat race, starting on the 1st of January and ending on the 31st of December each year. There are a lot of boats in the water. Some are small, some are big, some are whole fleets. Your objective is to choose the fastest boat at any time. If you invest all of your money in one small boat, that might sink before the end of the year, you are putting yourself at risk. Say: Startup Capital. If you invest all of your money in a medium sized boat, you still run the risk of it sinking. Say: Stock market stock. If you invest all of your money in a supertanker, the risk of it sinking is smaller, and the probability of it ending first in the race is also smaller. Say: a stock of a multinational. A fleet is limited by it's slowest boat, but it will surely reach the shore. Say: a fund. Now investing money is time consuming, and you may not have the money to create your own portfolio (your own fleet). So a fund should be your choice. However, there are a lot of funds out there, and not all funds perform the same. Most funds are compared with their index. A 3 star Morningstar rated fund is performing on par with it's index for a time period. A 4 or 5 star rated fund is doing better than it's index. Most funds fluctuate between ratings. A 4 star rated fund can be mismanaged and in a number of months become a 2 star rated fund. Or the other way around. But it's not just luck. Depending on the money you have available, your best bet is to buy a number of star rated, managed funds. There are a lot of factors to keep into account. Currency is one. Geography, Sector... Don't buy for less than 1.000€ in one fund, and don't buy more than 10 funds. Stay away from Gold, unless you want to speculate (short term). Stay away from the USD (for now). And if you can prevent it, don't put all your eggs in one basket.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Can a CEO short his own company?
<|im_end|>
<|im_start|>assistant
It seems also on some international markets this is allowed. http:\/\/www.businessinsider.com\/li-hejun-shorting-hanergy-2015-5
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Why does short selling require borrowing?
<|im_end|>
<|im_start|>assistant
It's actually quite simple. You're actually confusing two concept. Which are taking a short position and short selling itself. Basically when taking a short position is by believing that the stock is going to drop and you sell it. You can or not buy it back later depending on the believe it grows again or not. So basically you didn't make any profit with the drop in the price's value but you didn't lose money either. Ok but what if you believe the market or specific company is going to drop and you want to profit on it while it's dropping. You can't do this by buying stock because you would be going long right? So back to the basics. To obtain any type of profit I need to buy low and sell high, right? This is natural for use in long positions. Well, now knowing that you can sell high at the current moment and buy low in the future what do you do? You can't sell what you don't have. So acquire it. Ask someone to lend it to you for some time and sell it. So selling high, check. Now buying low? You promised the person you would return him his stock, as it's intangible he won't even notice it's a different unit, so you buy low and return the lender his stock. Thus you bought low and sold high, meaning having a profit. So technically short selling is a type of short position. If you have multiple portfolios and lend yourself (i.e. maintaining a long-term long position while making some money with a short term short-term strategy) you're actually short selling with your own stock. This happens often in hedge funds where multiple strategies are used and to optimise the transaction costs and borrowing fees, they have algorithms that clear (match) long and short coming in from different traders, algorithms, etc. Keep in mind that you while have a opportunities risk associated. So basically, yes, you need to always 'borrow' a product to be able to short sell it. What can happen is that you lend yourself but this only makes sense if:
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How quickly does short float ratio\/percent change?
<|im_end|>
<|im_start|>assistant
The short float ratio and percent change are all calculated based on the short interest (the total number of shares shorted). The short interest data for Nasdaq and NYSE stocks is published every two weeks. NasdaqTrader.com shows the exact dates for when short interest is published for Nasdaq stocks, and also says the following: FINRA member firms are required to report their short positions as of settlement on (1) the 15th of each month, or the preceding business day if the 15th is not a business day, and (2) as of settlement on the last business day of the month.* The reports must be filed by the second business day after the reporting settlement date. FINRA compiles the short interest data and provides it for publication on the 8th business day after the reporting settlement date. The NYSE also shows the exact dates for when short interest is published for NYSE stocks, and those dates are exactly the same as for Nasdaq stocks. Since the short interest is only updated once every 2 weeks, there is no way to see real-time updating of the short float and percent change. That information only gets updated once every 2 weeks - after each publication of the short interest.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Should a high-school student invest their (relative meager) savings?
<|im_end|>
<|im_start|>assistant
Between 1 and 2 G is actually pretty decent for a High School Student. Your best bet in my opinion is to wait the next (small) stock market crash, and then invest in an index fund. A fund that tracks the SP500 or the Russel 2000 would be a good choice. By stock market crash, I'm talking about a 20% to 30% drop from the highest point. The stock market is at an all time high, but nobody knows if it's going to keep going. I would avoid penny stocks, at least until you can read their annual report and understand most of what they're claiming, especially the cash flow statement. From the few that I've looked at, penny stock companies just keep issuing stock to raise money for their money loosing operations. I'd also avoid individual stocks for now. You can setup a practice account somewhere online, and try trading. Your classmates probably brag about how much they've made, but they won't tell you how much they lost. You are not misusing your money by "not doing anything with it". Your classmates are gambling with it, they might as well go to a casino. Echoing what others have said, investing in yourself is your best option at this point. Try to get into the best school that you can. Anything that gives you an edge over other people in terms of experience or education is good. So try to get some leadership and team experience. , and some online classes in a field that interests you.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What benefits do "title search companies" have over physically visiting a land records offices?
<|im_end|>
<|im_start|>assistant
Basically what @littleadv said, but let me amplify what I think is the most important point. As he\/she says, one thing you're paying them for is their expertise. If the title on record at the county office had a legal flaw in it, would you recognize it? In a way your question is like asking, Why should I go to a doctor when I could just make my own medicine out of herbs I grow in my garden and treat myself? Maybe you could. But the doctor and the pharmacist have years of training on how to do this right. You probably don't. Is it possible for you to learn everything you need to do it right? Sure. But do you want to spend the time to study all that for something that you will do -- buy a house -- maybe once every ten years? Will you remember it all next time or have to learn it all over? But really most important is, title companies offer insurance in case the title turns out to be flawed. That, to me, is the big reason why I would use a title company even if I was paying cash and there was no bank involved to insist on it. If there's some legal flaw in the title and it turns out that someone else has a claim to my house, and I lose in court, I would be out about $100,000. Your house might be costing you much more. That's a huge risk to take. Paying the couple of hundred dollars for insurance against that risk seems well worth it to me. And by the way, I don't think the "due diligence" is easy. It's NOT just a matter of making sure a title is really on file at the court house and has the proper stamp on it. It's all about, Does someone else have a legal claim to this property? Like, maybe three owners ago someone forged a signature on a deed, so the sale is fraudulent, and now the person who was defrauded or his heirs discover the issue and claim the property. Or maybe the previous owner failed to pay a contractor who did repairs on the house, and now he goes to court and gets a lien on the property. It's unlikely that you have the expertise to recognize a forged document. You almost surely have no way to recognize a forged signature of someone you never met on an otherwise valid-looking document. And you'd have to do a lot of research to find every contractor who ever worked on the house and insure none of them have a claim. Etc.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Can PE ratio of stocks be compared to other investments?
<|im_end|>
<|im_start|>assistant
In the long run (how long?) a shares price always reverts to being its proportional amount of the company's residual equity plus the net present value of its expected future cash flows. Or at least that's the theory. In practice PE ratio is used not as a way of measuring what the stock price itself will do but what the fundamental value of holding that share is compared to its price. It is a way of measuring what a company is worth compared to its price and comparing it against other companies to find companies where the underlying value of the company is underrepresented by the price. Comparing PE ratios within the same industry or sector is the most valid use for this (other than comparing previous years of the same company) and the validity of the comparison drops as the structure of the firm you are comparing with gets more different to that of the company. Each industry has its own "typical" average PE ratio and these differ wildly between industries so in a great many cases even comparing PE ratios between similar stocks in different industries isn't valid. Any weird pseudo PE ratio that you create for other instruments will be meaningless. In general the best way to compare investments across multiple instruments is by comparing returns. when comparing stocks to other instruments you may want to use the return on stock price or the return on capital employed (ROCE) depending on whether you want to compare the trading performance or the fundamental performance.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
My university has tranfered me money by mistake, and wants me to transfer it back
<|im_end|>
<|im_start|>assistant
You have received some good answers, but since your concern is proper protocol, keep everything in writing (emails, not phone calls). Also, you'll get a quick response by contacting the University "Accounts Payable" department, confirm the situation with a summary as you posted here and ask for the ABA routing number for the transfer. The routing number, email, and you bank statement is all the records you need to cover your but.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is the ESPP discount profit?
<|im_end|>
<|im_start|>assistant
The difference is ordinary income. If the price drops and you sell for exactly what you paid, you have an income of D and a capital loss of D which usually cancel each other, but not always. For example, if you already have over $3000 in losses, this loss won't help you, it will carry forward. The above changes a bit if you hold the stock for 2 years after the beginning of the purchase period. If sold between your purchase price and fair market the day you bought, the gain is only the difference, no gain to fair market + loss. Pretty convoluted. Your company should have provided you with a brief FAQ \/ Q&A to explain this. My friends at Fairmark have an article that explains the ESPP process clearly, Tax Reporting for Qualifying Dispositions of ESPP Shares.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is investing exlusively in a small-cap index fund a wise investment?
<|im_end|>
<|im_start|>assistant
If the OP is saving 33% if his\/her current income, he\/she doesn't want or need yet more income from investments right now. The advice on "diversifying" in the other answers is the standard "investment advisor" response to beginner's questions, and has two advantages for the advisor: (1) they won't get sued for giving bad advice and (2) they can make a nice fat commission selling you some very-average-performance products (and note they are selling you "investment industry products," not necessarily "good investment opportunities" - advisors get paid commission and bonuses for selling more stuff, not for selling good stuff). My advice would be to drip-feed some of your excess income into the emerging market sector (maybe 1\/3 or 1\/4 of the excess), with the intention of leaving it there untouched for up to 20 or 30 years, if need be. At some unknown future time, it is almost certain there will be another EM "boom," if only because people have short memories. When that happens, sell up, take your profits, and do something less risky with them. You might consider putting another slice of your excess income into the commodities sector. I don't know when the oil price will be back at $150 or $200 a barrel, but I would be happy to bet it will happen sometime in the OP's lifetime... Since you apparently have plenty of income and are relatively young, that is the ideal time to adopt a risky investment strategy. Even if you lose your entire investment over the next 5 years, you still have another 20 years to recover from that disaster. If you were starting to invest at age 56 rather than 26, the risk\/reward situation would be very different, of course.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Weekly budgets based on (a variable) monthly budget
<|im_end|>
<|im_start|>assistant
I think the real problem here is dealing with the variable income. The envelope solution suggests the problem is that your brother doesn't have the discipline to avoid spending all his money immediately, but maybe that's not it. Maybe he could regulate his expenses just fine, but with such a variable income, he can't settle into a "normal" spending pattern. Without any savings, any budget would have to be based on the worst possible income for a month. This isn't a great: it means a poor quality of life. And what do you do with the extra money in the better-than-worst months? While it's easy to say "plan for the worst, then when it's better, save that money", that's just not going to happen. No one will want to live at their worst-case standard of living all the time. Someone would have to be a real miser to have the discipline to not use that extra money for something. You can say to save it for emergencies or unexpected events, but there's always a way to rationalize spending it. "I'm a musician, so this new guitar is a necessary business expense!" Or maybe the car is broken. Surely this is a necessary expense! But, do you buy a $1000 car or a $20000 car? There's always a way to rationalize what's necessary, but it doesn't change financial reality. With a highly variable income, he will need some cash saved up to fill in the bad months, which is replenished in the good months. For success, you need a reasonable plan for making that happen: one that includes provisions for spending it other than "please try not to spend it". I would suggest tracking income accurately for several months. Then you will have a real number (not a guess) of what an average month is. Then, you can budget on that. You will also have real numbers that allow you to calculate how long the bad stretches are, and thus determine how much cash reserve is necessary to make the odds of going broke in a bad period unlikely. Having that, you can make a budget based on average income, which should have some allowance for enjoying life. Of course initially the cash reserve doesn't exist, but knowing exactly what will happen when it does provides a good motivation for building the reserve rather than spending it today. Knowing that the budget includes rules for spending the reserves reduces the incentive to cheat. Of course, the eventual budget should also include provisions for long term savings for retirement, medical expenses, car maintenance, etc. You can do the envelope thing if that's helpful. The point here is to solve the problem of the variable income, so you can have an average income that doesn't result in a budget that delivers a soul crushing decrease in quality of living.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
When are investments taxed?
<|im_end|>
<|im_start|>assistant
This answer is about the USA. Each time you sell a security (a stock or a bond) or some other asset, you are expected to pay tax on the net gain. It doesn't matter whether you use a broker or mutual fund to make the sale. You still owe the tax. Net capital gain is defined this way: Gross sale prices less (broker fees for selling + cost of buying the asset) The cost of buying the asset is called the "basis price." You, or your broker, needs to keep track of the basis price for each share. This is easy when you're just getting started investing. It stays easy if you're careful about your record keeping. You owe the capital gains tax whenever you sell an asset, whether or not you reinvest the proceeds in something else. If your capital gains are modest, you can pay all the taxes at the end of the year. If they are larger -- for example if they exceed your wage earnings -- you should pay quarterly estimated tax. The tax authorities ding you for a penalty if you wait to pay five- or six-figure tax bills without paying quarterly estimates. You pay NET capital gains tax. If one asset loses money and another makes money, you pay on your gains minus your losses. If you have more losses than gains in a particular year, you can carry forward up to $3,000 (I think). You can't carry forward tens of thousands in capital losses. Long term and short term gains are treated separately. IRS Schedule B has places to plug in all those numbers, and the tax programs (Turbo etc) do too. Dividend payments are also taxable when they are paid. Those aren't capital gains. They go on Schedule D along with interest payments. The same is true for a mutual fund. If the fund has Ford shares in it, and Ford pays $0.70 per share in March, that's a dividend payment. If the fund managers decide to sell Ford and buy Tesla in June, the selling of Ford shares will be a cap-gains taxable event for you. The good news: the mutual fund managers send you a statement sometime in February or March of each year telling what you should put on your tax forms. This is great. They add it all up for you. They give you a nice consolidated tax statement covering everything: dividends, their buying and selling activity on your behalf, and any selling they did when you withdrew money from the fund for any purpose. Some investment accounts like 401(k) accounts are tax free. You don't pay any tax on those accounts -- capital gains, dividends, interest -- until you withdraw the money to live on after you retire. Then that money is taxed as if it were wage income. If you want an easy and fairly reliable way to invest, and don't want to do a lot of tax-form scrambling, choose a couple of different mutual funds, put money into them, and leave it there. They'll send you consolidated tax statements once a year. Download them into your tax program and you're done. You mentioned "riding out bad times in cash." No, no, NOT a good idea. That investment strategy almost guarantees you will sell when the market is going down and buy when it's going up. That's "sell low, buy high." It's a loser. Not even Warren Buffett can call the top of the market and the bottom. Ned Johnson (Fidelity's founder) DEFINITELY can't.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Is keeping track of your money and having a budget the same thing?
<|im_end|>
<|im_start|>assistant
The two are closely related. A budget is a detailed plan for how to spend. Expense tracking is a tool to analyze your previous spending performance. Creating a plan for how to spend your money without any record of your previous spending--is an empty promise to yourself that you will never follow up on. Did I stay within my budget? Doesn't matter, I didn't track the spending anyway. Even if you do plan to track your performance, if you have not previously done so, you won't have a good basis for how much to expect in each category. Most people have a general idea of how much they have spent and many budgets are formed based on that general intuition, but they are often surprised when they track how every penny is spent and look at the totals from month to month and over years. By actually seeing how much has been spent it's easier to pick the big financial drains and target them for reduction, if your desire is more savings, for example. I know people who keep a close eye on what they spend each month, but they don't allocate money in categories for the next month. They don't perform as well on reducing spending, but they often don't care. They feel like they make enough and they save enough, so why worry? I also know people who create an unrealistic budget each month because they haven't done a good job tracking their previous spending. They know what the monthly bills are, but they don't account well for variable or cyclical expenses like repairs, Christmas, etc. Both tools are essential for maximizing your own personal finance.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Shares; are they really only for the rich\/investors?
<|im_end|>
<|im_start|>assistant
A guy I used to work with would buy some shares in certain companies on a regular basis. The guy in question chose Coke, Pepsi, GE, Disney and some other old stable stocks. He just kept buying a few shared ($50 or so at a time) year after year after year. He worked his entire life, but by the time he was ready to retire, he had a pretty sizable investment; he was worth a rather tidy sum. The moral of the story is, it is very much worth it to invest a bit at a time. Don't bother with the idea of buying low and selling high; not right now. Just go ahead and buy stable stocks (or shares of index funds) and wait them out. This strategy (mixed with other retirement tactics like a 401K from work, and IRA of your own, Social Security in the US) is a good way to build wealth. Don't spend money you don't have, be ready for a long term investment and I think it makes great sense, regardless of what country you live in.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Are stock index fund likely to keep being a reliable long-term investment option?
<|im_end|>
<|im_start|>assistant
Stock index funds are likely, but not certainly, to be a good long-term investment. In countries other than the USA, there have been 30+ year periods where stocks either underperformed compared to bonds, or even lost value in absolute terms. This suggests that it may be an overgeneralization to assume that they always do well in the long term. Furthermore, it may suggest that they are persistently overvalued for the risk, and perhaps due for a long-term correction. (If everybody assumes they're safe, the equity risk premium is likely to be eaten up.) Putting all of your money into them would, for most people, be taking an unnecessary risk. You should cover some other asset classes too. If stocks do very well, a portfolio with some allocation to more stable assets will still do fairly well. If they crash, a portfolio with less risky assets will have a better chance of being at least adequate.
<|im_end|>
|
<|im_start|>user
Generate the answer for the following question
Why don't market indexes use aggregate market capitalization?
<|im_end|>
<|im_start|>assistant
They do but you're missing some calculations needed to gain an understanding. Intro To Stock Index Weighting Methods notes in part: Market cap is the most common weighting method used by an index. Market cap or market capitalization is the standard way to measure the size of the company. You might have heard of large, mid, or small cap stocks? Large cap stocks carry a higher weighting in this index. And most of the major indices, like the S&P 500, use the market cap weighting method. Stocks are weighted by the proportion of their market cap to the total market cap of all the stocks in the index. As a stock’s price and market cap rises, it gains a bigger weighting in the index. In turn the opposite, lower stock price and market cap, pushes its weighting down in the index. Pros Proponents argue that large companies have a bigger effect on the economy and are more widely owned. So they should have a bigger representation when measuring the performance of the market. Which is true. Cons It doesn’t make sense as an investment strategy. According to a market cap weighted index, investors would buy more of a stock as its price rises and sell the stock as the price falls. This is the exact opposite of the buy low, sell high mentality investors should use. Eventually, you would have more money in overpriced stocks and less in underpriced stocks. Yet most index funds follow this weighting method. Thus, there was likely a point in time where the S & P 500's initial sum was equated to a specific value though this is the part you may be missing here. Also, how do you handle when constituents change over time? For example, suppose in the S & P 500 that a $100,000,000 company is taken out and replaced with a $10,000,000,000 company that shouldn't suddenly make the index jump by a bunch of points because the underlying security was swapped or would you be cool with there being jumps when companies change or shares outstanding are rebalanced? Consider carefully how you answer that question. In terms of histories, Dow Jones Industrial Average and S & P 500 Index would be covered on Wikipedia where from the latter link: The "Composite Index",[13] as the S&P 500 was first called when it introduced its first stock index in 1923, began tracking a small number of stocks. Three years later in 1926, the Composite Index expanded to 90 stocks and then in 1957 it expanded to its current 500.[13] Standard & Poor's, a company that doles out financial information and analysis, was founded in 1860 by Henry Varnum Poor. In 1941 Poor's Publishing (Henry Varnum Poor's original company) merged with Standard Statistics (founded in 1906 as the Standard Statistics Bureau) and therein assumed the name Standard and Poor's Corporation. The S&P 500 index in its present form began on March 4, 1957. Technology has allowed the index to be calculated and disseminated in real time. The S&P 500 is widely used as a measure of the general level of stock prices, as it includes both growth stocks and value stocks. In September 1962, Ultronic Systems Corp. entered into an agreement with Standard and Poor's. Under the terms of this agreement, Ultronics computed the S&P 500 Stock Composite Index, the 425 Stock Industrial Index, the 50 Stock Utility Index, and the 25 Stock Rail Index. Throughout the market day these statistics were furnished to Standard & Poor's. In addition, Ultronics also computed and reported the 94 S&P sub-indexes.[14] There are also articles like Business Insider that have this graphic that may be interesting: S & P changes over the years The makeup of the S&P 500 is constantly changing notes in part: "In most years 25 to 30 stocks in the S&P 500 are replaced," said David Blitzer, S&P's Chairman of the Index Committee. And while there are strict guidelines for what companies are added, the final decision and timing of that decision depends on what's going through the heads of a handful of people employed by Dow Jones.
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<|im_start|>user
Generate the answer for the following question
devastated with our retirement money that we have left
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<|im_start|>assistant
I'll be blunt.
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<|im_start|>user
Generate the answer for the following question
Visitor Shopping in the US: Would I get tax refund? Would I have to pay anything upon departure?
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<|im_start|>assistant
Yes, you get a refund but only in a couple of states. If you are visiting Louisiana (e.g. New Orleans), there is sales tax refund on tangible items purchased at tax-free stores and permanently removed from the United States (http:\/\/www.louisianataxfree.com) . Clothes, shoes, makeup.. these are all items you can claim a tax refund for. Alas, I believe only Louisiana and Texas (http:\/\/taxfreetexas.com\/) have this, it might be good to know if you are going there. In some states (Alaska, Delaware, Montana, New Hampshire and Oregon I believe) there is no sales tax at all. You do not pay anything at customs for gifts purchased when you leave the United States.
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<|im_start|>user
Generate the answer for the following question
What is the equation for an inflation adjusted annuity held in perpetuity?
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<|im_start|>assistant
The question lacks specificity, i.e. when does the initial investment occur, now or one period from now? If now then it is a perpetuity due. I will consider under 2 scenarios, A and B, relating to the size of the initial investment. A. Assuming that the initial investment (C_0) occurs now and each payment thereafter has the relationship (1+g) with this investment then the relevant base equation is that for the present value of a growing perpetuity due, expressed in terms of C_0, i.e. PVGPD= [C_0*(1+g)*(1+i)]\/(i-g). Now, to suit the question asked, we can see that i=fixed rate of return (f) and g = expected inflation rate (e) such that we can rewrite the equation as PVGPD = [C_0*(1+e)*(1+i)]\/(i-e]. We know that f = is a fixed nominal rate and must be adjusted for e to calculate the real rate (r) according to the equation f=(1+r)*(1+e)-1. Therefore PVGPD = [C_0*(1+e)(1+(1+r)(1+e)-1)]\/((1+r)*(1+e)-1-e] Tidying up PVGPD = {C_0*(1+r)(1+e)^2}\/[r(1+e)] PVGPD = [C_0*(1+r)*(1+e)]\/r B. Assuming that the initial investment (X) is not equal to each subsequent perpetual payment (C_1) then the relevant base equation is that for the the initial investment plus the present value of a growing perpetuity, i.e. PVGP= X + [C_1\/(i-g)] Rewriting PVGP = X + [C_1\/(f-e)] Substituting PVGPD = X + {C_1\/[(1+r)*(1+e)-1-e]} Tidying up PVGPD = X + C_1\/[r*(1+e)]
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<|im_start|>user
Generate the answer for the following question
Does keeping 'long-term' safety net in bonds make sense?
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<|im_start|>assistant
I am understanding the OP to mean that this is for an emergency fund savings account meant to cover 3 to 6 months of living expenses, not a 3-6 month investment horizon. Assuming this is the case, I would recommend keeping these funds in a Money Market account and not in an investment-grade bond fund for three reasons:
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<|im_start|>user
Generate the answer for the following question
Are services provided to Google employees taxed as income or in any way?
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<|im_start|>assistant
Most of this is already regulated. "Food" specifically is exempt from taxes if it's done on premise and for the "convenience of the employer", whatever that means. See https:\/\/www.law.cornell.edu\/uscode\/text\/26\/119 Other benefits, such as commuter aid (public transport, parking) are tax free up to a certain limit (I think $255 for 2017) and any excess it taxable income. You can study the whole gory details at https:\/\/www.irs.gov\/pub\/irs-pdf\/p15b.pdf
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<|im_start|>user
Generate the answer for the following question
How to determine whether 1099-MISC income is from self-employment?
<|im_end|>
<|im_start|>assistant
These kinds of questions can be rather tricky. I've struggled with this sort of thing in the past when I had income from a hobby, and I wanted to ensure that it was indeed "hobby income" and I didn't need to call it "self-employment". Here are a few resources from the IRS: There's a lot of overlap among these resources, of course. Here's the relevant portion of Publication 535, which I think is reasonable guidance on how the IRS looks at things: In determining whether you are carrying on an activity for profit, several factors are taken into account. No one factor alone is decisive. Among the factors to consider are whether: Most of the guidance looks to be centered around what one would need to do to convince the IRS that an activity actually is a business, because then one can deduct the "business expenses", even if that brings the total "business income" negative (and I'm guessing that's a fraud problem the IRS needs to deal with more often). There's not nearly as much about how to convince the IRS that an activity isn't a business and thus can be thrown into "Other Income" instead of needing to pay self-employment tax. Presumably the same principles should apply going either way, though. If after reading through the information they provide, you decide in good faith that your activity is really just "Other income" and not "a business you're in on the side", I would find it likely that the IRS would agree with you if they ever questioned you on it and you provided your reasoning, assuming your reasoning is reasonable. (Though it's always possible that reasonable people could end up disagreeing on some things even given the same set of facts.) Just keep good records about what you did and why, and don't get too panicked about it once you've done your due diligence. Just file based on all the information you know.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Merchant dispute with airline over missed flight, and which credit cards offer protection?
<|im_end|>
<|im_start|>assistant
EDIT To answer what I think you question is: I do not know of anything other than trip cancellation insurance. And you must be very careful that the policy you purchase for your trip covers the circumstance you described. Essentially, you opted not to take the flight. Not all trip cancellation policies will cover that. How to Find Trip Cancellation Insurance Getting Your Money Back Now This is an Act of God in the insurance world. You cannot reasonably expect the airline to know the future weather pattern anymore than you could, and therefore, since the plane did fly, you owe them the money based on the ticket you bought. You didn't just buy a ticket, there is a contract with rules about refunds and transferring and such. It is a bummer situation, and I understand you point of view, but this isn't the airline's fault. If anybody is to blame for you missing your flight, and therefore not getting a refund, it is your employer. Their requirements for you be in one city and then another are the cause. While your employer cannot predict the weather, they are ultimately the ones who could give you the okay to be late. If you absolutely cannot be late, and it was critical that you drive out and miss your flight, then your company gets to pay for the flight AND the car. That is the cost of doing business for them. This is also why, when flying for business, that you pay the higher price and get the refundable \/ transferable ticket. They cost more, but situations like these illustrate they are worth it for the company.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Looking to buy a property that's 12-14x my income. How can it be done?
<|im_end|>
<|im_start|>assistant
What options do I have? Realistically? Get a regular full time job. Work at it for a year or so and then see about buying a house. That said, I recently purchased a decent home. I am self-employed and my income is highly erratic. Due to how my clients pay me, my business might go a couple months with absolutely no deposits. However, I've been at this for quite a few years. So, even though my business income is erratic, I pay myself regularly once a month. In order to close the deal with the mortgage company I had to provide 5 years worth of statements on my business AND my personal bank accounts. Also I had about a 30% down payment. This gave the bank enough info to realize that I could absolutely make the payments and we closed the deal. I'd say that if you have little to no actual financial history, don't have a solid personal income and don't have much of a down payment then you probably have no business buying a house at this point. The first time something goes wrong (water heater, ac, etc) you'll be in a world of trouble.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
F-1 Visa expired - Unable to repay private student loan. What to do?
<|im_end|>
<|im_start|>assistant
As an international student, the tuition is sky high. Typically, most students take loans for Education and start paying it back once they get a job. If you have exhausted your OPT period and have not got H1B, your options are either to go for further education(Hint: Phd), you can hope to cover living expense by part-time on campus job. This will give you additional time to look for a job and try for H1B again!
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
How do I screen for stocks that are near to their 52 weeks low
<|im_end|>
<|im_start|>assistant
The screener at FinViz.com will let you screen for stocks at their 52-week low.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
Value investing
<|im_end|>
<|im_start|>assistant
The Investment Entertainment Pricing Theory (INEPT) has this bit to note: The returns of small growth stocks are ridiculously low—just 2.18 percent per year since 1927 (versus 17.47 percent for small value, 10.06 percent for large growth, and 13.99 percent for large value). Where the S & P 500 would be a blend of large-cap growth and value so does that meet your "beat the market over the long term" as 1927-1999 would be long for most people.
<|im_end|>
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<|im_start|>user
Generate the answer for the following question
What is the ticker symbol for "Vanguard Target Retirement 2045 Trust Plus"?
<|im_end|>
<|im_start|>assistant
Use VTIVX. The "Target Retirement 2045" and "Target Retirement 2045 Trust Plus" are the same underlying fund, but the latter is offered through employers. The only differences I see are the expense ratio and the minimum investment dollars. But for the purposes of comparing funds, it should be pretty close. Here is the list of all of Vanguard's target retirement funds. Also, note that the "Trust Plus" hasn't been around as long, so you don't see the returns beyond the last few years. That's another reason to use plain VTIVX for comparison. See also: Why doesn't a mutual fund in my 401(k) have a ticker symbol?
<|im_end|>
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