Do your finances seem like a black hole? Money comes in, maybe even lots of it, but it gets sucked into nowhere and you’re not sure how it happened? This may occur for lots of reasons, but the biggest is biting off more than you chew (or pay for). Another way of saying this is you are not living within your means. For example:
Tags: abundance, debt, finance, finances, money, prosperity, saving, spending
Penny stocks, also commonly referred to as small-cap
stocks, are loosely defined as a stock with a share
price below $5. The US Securities and Exchange Commission
(SEC) defines them as such, however, penny stocks are often
defined as a stock with a share price below $1 by those in
the investor community.
Penny stocks are the stock market’s equivalent of junk
bonds in the bond market. Investing in penny stocks can be
much riskier than trading mid to large-cap stocks.
Severe and long lasting drops can quickly occur, with
little warning. Conversely, penny stocks can yield rapid
gains, sometimes up to +1000% in the matter of days. This,
coupled with the low price, often lures new investors into
trading penny stocks.
The difference between penny stocks and blue-chip and mid-
cap stocks is important to understand before you invest.
Whereas the market performance or normal mid to large-cap
stocks is driven primarily by fundamentals, penny stock
performance can be much more pliant to investor
speculation. A company’s market capitalization (cap)
derives from its stock price multiplied by the shares
outstanding. This number is therefore the sum dollar value
of all of the company’s shares at that time. So a penny
stock has less shareholders than a mid-cap stock and
trades on a far smaller volume per day. This is why penny
stocks are so speculative. Any sudden change in demand or
supply for the stock will be felt quickly throughout the
entire framework. As earlier stated, this can be good (less
people to share the profit with), or bad (less people to
shoulder the loss). Penny stocks are much more volatile
than mid or large cap stocks and this is why many investors
regard them as a gamble.
One of the justifications for investing in penny stocks is
the notion that many of today’s blue-chip stocks, such as
Google and Microsoft, were once penny stocks. This is a
misconception, though, because after you adjust for stock
splits, it becomes apparent that these company’s shares
were actually almost never trading on par with penny
stocks. Investors often overlook this fact and look for the
next Microsoft when buying penny stocks.
Because of the lower trading volume, penny stocks lack
“liquidity,” which means that investors can find it more
challenging to buy or sell. Just like with junk bonds, lack
of liquidity opens the gate to stock manipulation by
fraudulent investors.
Many novice investors are eager to jump into the penny
stock trade because of the potential for enormous gains.
Just as with gambling, though, an investor must be ready
to lose everything that they have invested when dealing
with penny stocks. Furthermore, historically speaking,
huge rises in penny stock value are incredibly rare. Even
in the few instances where this has happened, the price is
usually unstable, and falls as quickly as it rose. If you
are new to investing, be sure to research the company in
which you are investing. Analyze their fundamentals and
be aware of the potential risks involved in the penny
stock trade.
Taft Coventry is an Associate Partner at the most
trusted source for online money making information,
http://MadisonandMonroe.org
Visit http://www.MadisonandMonroe.org for online
business information, articles, and financial
product reviews.
Your credit score is also commonly known as your FICO score. So what is your FICO score? FICO (Fair Isaac and Company Inc) is the credit rating that determines whether or not you get to finance that first car, purchase that first home or buy just about anything else you might want using credit. FICO scores are your credit rating. Most lenders base approval on them. You have three FICO scores, one for each credit bureau Equifax, TransUnion & Experion.
Whether you get a loan to buy a home depends on a computer-generated credit score that compares certain things about you. Things like how much money you earn, how long you’ve been using credit and whether you’ve made payments on time, determine your credit worthiness.
The five main criteria are:
1. Payment history - Your payment history on credit cards, retail accounts at stores, installment loans, and mortgages. (35% of total score
)
2. Amounts owed - What is important is how many accounts have balances and how much of the total credit line is being used on credit cards and other “revolving credit” accounts. (30% of total score.)
3. Length of credit history - That’s why parents should help children establish credit histories before they go out on their own. (15% of total score.)
4. New credit - Applying for too much new credit is one of the easiest ways for people to inadvertently harm their credit score. (10% of total score)
5. Types of credit - This takes into account your mix of installment loans, mortgages, retail accounts, credit cards and finance company accounts. (10% of total score)
The scores that the companies compile are sent to the credit reporting agencies as composite numbers. In addition to your salary and other factors mentioned above, here are some of the things that scoring agencies consider:
If all of this sounds arbitrary or unfair, remember that scoring systems have allowed department stores and other lending agencies to offer those “on-the-spot” credit approvals. You know the routine. You fill out some basic information on a card and five minutes later (if the computer is working properly), you’re either approved or disapproved for a loan.
Joe Kahler is recognized as an expert on helping young adults successfully transition from home to being “out on their own”. His latest work has recently been assembled in his book, Out On My Own… Now What? Tips and Insights So You Won’t Be Left Hanging in the “Real World”!
Joe received his undergraduate degree from Whittier College in Social Sciences and his Masters in Education from Arizona State University. His experience includes teaching, coaching, running numerous businesses, investing, selling insurance and real estate AND attending numerous personal, “hard knocks” training classes!
http://www.outonmyown.com
Tags: credit, credit repair, credit score, diy credit repair, FICO, fico guide, finance, fixing your credit score