vania-janet/multiturn-rag-retrieval-data huggingface dataset:
"A fund is a portfolio, in that it is a collection, so the term is interchangeable for the most part.  Funds are made up of a combination of equities positions (i.e., stocks, bonds, etc.) plus some amount of un-invested cash. Most of the time, when people are talking about a ""fund"", they are describing what is really an investment strategy.  In other words, an example would be a ""Far East Agressive"" fund (just a made up name for illustration here), which focuses on investment opportunities in the Far East that have a higher level of risk than most other investments, thus they provide better returns for the investors.  The ""portfolio"" part of that is what the stocks are that the fund has purchased and is holding on behalf of its investors.  Other funds focus on municipal bonds or government bonds, and the list goes on. I hope this helps. Good luck!"
A stock represents your share of ownership in a corporation. All of these shares indicate towards your part of ownership in a corporation a shareholder, stockholder or a shareowner in a company. In order to get a stock, be sure to secure the assistance of a licensed stockbroker to buy securities on your behalf. Yes, anyone having substantial amount of money to invest can buy/own/use stocks. Holding a stock for less than a year makes it a subject to tax on your regular income for short-term gains. Most of the people find it higher than the capital gains. In addition, your annual income also comes into play.
The stock market is no different in this respect to anything that's bought or sold. The price of a stock like many other things reflects what the seller is prepared to sell it at and what the buyer is prepared to offer for it. If those things match then a transaction can take place. The seller loses money but gains stocks they feel represent equivalent value, the reverse happens for the buyer. Take buying a house for example, did the buyer lose money when they bought a house, sure they did but they gained a house. The seller gained money but lost a house. New money is created in the sense that companies can and do make profits, those profits, together with the expected profits from future years increase the value that is put on the company. If we take something simple like a mining company then its value represents a lot of things: and numerous other lesser things too. The value of shares in the mining company will reflect all of these things. It likely rises and falls in line with the price of the raw materials it mines and those change based on the overall supply and demand for those raw materials. Stocks do have an inherent value, they are ownership of a part of a company. You own part of the asset value, profits and losses made by that company. Betting on things is different in that you've no ownership of the thing you bet on, you're only dependent on the outcome of the bet.
It has been hinted at in some other answers, but I want to say it explicitly: Volatility is not risk. Volatility is how much an investment goes up and down, risk is the chance that you will lose money. For example, stocks have relatively high volatility, but the risk that you will lose money over a 40 year period is virtually zero (in particular if you invest in index funds). Bonds, on the other hand, have basically no volatility (their cash flow is totally predictable if you trust the future of your government), but there is a significant risk that they will perform worse than stocks over a longer period. So, volatility equals risk only if you are day trading. A 401(k) is literally the opposite of that. For further reading: Never confuse risk and volatility Also, investing is not gambling. Gambling is bad because the odds are stacked against you. You need more than average luck to actually win and the longer you play, the more you will lose. Investing means buying productive capital that will produce further value. The odds are in your favor. Even if you do a moderately bad job at investing, the longer you stay, the more you will win.
Hart's answer regarding the difference between an index and a stock aside, remember that dividend yield is a passive measure.  It takes the announced dividend (which is a $/share amount) and divides it by the current market price.   So you can't assume that if you buy a stock that had a dividend yield of 4% for $100 that you're guaranteed 4% of the stock price in dividends.  If the price of the stock doubles, you'd still get $4, but the yield would drop to 2%.  Or the company could reduce (or even suspend) its dividends, which would reduce the yield if the stock price stayed flat. For an index like the S&P, it's easier to measure dividends on % yield terms rather then $/share terms since you'd have to own shares in every single company to get that amount, but on average the stocks in the S&P 500 pay X% in dividends (which are typically quarterly) - some pay more than that, some less, and some none at all.
"Google Finance and Yahoo! Finance would be a couple of sites you could use to look at rather broad market information.  This would include the major US stock markets like the Dow, Nasdaq, S & P 500 though also bond yields, gold and oil can also be useful as depending on which area one works the specifics of what are important could vary.  If you were working at a well-known bond firm, I'd suspect that various bond benchmarks are likely to be known and watched rather than stock indices. Something else to consider here is what constitutes a ""finance practitioner"" as I'd imagine several accountants and actuaries may not watch the market yet there could be several software developers working at hedge funds that do so that it isn't just a case of what kind of work but also what does the company do."
In order to compare the two, you need to compare your entire portfolio, which is not just how much money you have, but how much stock. In both scenarios, you start with (at least, but let's assume) £20 and 0 stock. In your scenario, you buy 10 shares, leaving you with £0 and 10 shares. You then sell it at £1.50/share to cut your losses, leaving you with £15 and 0 shares. That concludes the first transaction with a net loss of £5. In a second transaction, you then buy 10 shares again at £1/share, leaving you with £5 and 10 shares. You are still down £15 from the start, but you also still have 10 shares. Any further profit or loss depends on what you can get for those 10 shares in the future. In a short sale, you borrow 10 shares and sell them, leaving you with £40 (your initial £20 plus what you just made on the short sale) and -10 shares of stock. At the end of the contract, you must buy 10 shares to return them; you are able to do so at £1.50/share, leaving you with £25 and 0 shares. At this point, your exposure to the stock is complete, and you have a net gain of £5.
A share of stock is an asset not much different than any other asset.  If the share is being held in a joint account, it's being jointly owned.  If the share is being held by a company with multiple owners then the share is owned by the various owners.  If you're married and in a community property state, then it's technically owned by both parties.
"To try and address your 'how' it goes a bit like this. You need to first assess how your stuff is invested, if for example half is in stocks, and the other half is in bonds, then you will need to calculate a 'blended' rate for what are reasonable 'average return' for both. That might mean looking at the S&P500 or Russell 3000 for the stock portion, and some bond index for that portion, then 'blend the rates', in this case using a formula like this then compare the blended rate with the return in your IRA. It is generally a lot more useful to compare the various components of your total return separately, especially if you investing with a particular style such as 'agressive growth' or you are buying actual bonds and not a bond fund since most of the bond oriented indexes are for bond funds, which you can't really compare well with buying and holding bonds to maturity. Lets say your stock side was two mutual funds with different styles, one 'large cap' the other 'aggressive growth'. In that case you might want to compare each one of those funds with an appropriate index such as those provided by Morningstar If you find one of them is consistently below the average, you might want to consider finding an alternative fund who's manager has a better track record (bearing in mind that ""past performance...."") For me (maybe someone has a good suggestion here) bonds are the hard thing to judge. The normal goal of actually owning bonds (as opposed to a fund) is to retain the entire principal value because there's no principal fluctuation if you hold the bond to maturity (as long as you choose well and the issuer doesn't default) The actual value 'right now' of a bond (as in selling before maturity) and bond funds, goes up and down in an inverse relationship with interest rates. That means the indexes for such things also go up and down a lot, so it's very hard to compare them to a bond you intend to hold to maturity. Also, for such a bond, there's not a lot of point to 'switch out' unless you are worried about the issuer defaulting.
One of the biggest reasons that stock returns are better than bond returns on average is that you are being paid to accept additional risk, and living with significant ups and downs is part of what it means to be in the stock market. If you are tempted to take money out of an asset class when it has been ""losing/feels dangerous"" and put more in when it is ""winning/feels safe"", my concerns is that you will end up buying high and selling low. I'd recommend taking a look at this article on the emotional cycle of investing. My point is simply that it's very likely that if you are moving money in and out of stocks based on volatility, you're much less likely to get the full market return over the long term, and might be better off putting more weight in asset classes with lower volatility. Either way, I'd recommend taking one or more risk tolerance assessments online and making sure you're committed to sticking with a long-term plan that doesn't involve more risk than you can really live with. I tend to lean toward Vanguard Life Strategy simply because Vanguard as a company has been around longer, but betterment does seem very accessible to a new investor. Best of luck with your decision!"
weird holdover from the bad old days when you had to do arithmetic by hand I would guess.  Stocks used to trade in 1/8ths, so bonds trading in even smaller increments makes sense.  Also (and I am unsure if this is still true) U.S. bonds trade on a 360 day year (or used to anyway) for the same reason... 360 divides well into months and quarters (for easier math) whereas 365 is considerably harder.  Most of the world now trades in decimals and 365/365 years so I am unsure why the U.S. doesn't.  Institutional inertia I would guess.
"What is a stock? A share of stock represents ownership of a portion of a corporation. In olden times, you would get a physical stock certificate (looking something like this) with your name and the number of shares on it. That certificate was the document demonstrating your ownership. Today, physical stock certificates are quite uncommon (to the point that a number of companies don't issue them anymore). While a one-share certificate can be a neat memento, certificates are a pain for investors, as they have to be stored safely and you'd have to go through a whole annoying process to redeem them when you wanted to sell your investment. Now, you'll usually hold stock through a brokerage account, and your holdings will just be records in a database somewhere. You'll pick a broker (more on that in the next question), instruct them to buy something, and they'll keep track of it in your account. Where do I get a stock? You'll generally choose a broker and open an account. You can read reviews to compare different brokerages in your country, as they'll have different fees and pricing. You can also make sure the brokerage firm you choose is in good standing with the financial regulators in your country, though one from a major national bank won't be unsafe. You will be required to provide personal information, as you are opening a financial account. The information should be similar to that required to open a bank account. You'll also need to get your money in and out of the account, so you'll likely set up a bank transfer. It may be possible to request a paper stock certificate, but don't be surprised if you're told this is unavailable. If you do get a paper certificate, you'll have to deal with considerably more hassle and delay if you want to sell later. Brokers charge a commission, which is a fee per trade. Let's say the commission is $10/trade. If you buy 5 shares of Google at $739/share, you'd pay $739 * 5 + $10 = $3705 and wind up with $3695 worth of stock in your account. You'd pay the same commission when you sell the stock.
Write off the entire asset class of corporate bonds? Finance theory says yes, the only two asset classes that you need are stocks and treasury bills (very short-term US government bonds). See the Capital Asset Pricing Model (CAPM).
If you buy stock in established companies, it is vey unlikely that they will lose all their value. Spreading your money across multiple stocks -- diversifying -- reduces that risk because it is extremely unlikely that they all lose all their value at once. Spreading them across multiple industries and adding bonds to the mix increases diversification. Of course the trade-off is that if one of the stocks skyrockets you don't benefit as much as if you had been lucky enough to put all your money in that one stock.  You need to decide for yourself how much risk you are willing to tolerate in exchange for the chance of gains.  Other answers on this site have dealt with this in more detail.
"I can't find a decent duplicate, so here are some general guidelines: First of all by ""stocks"" the answers generally mean ""equities"" which could be either single stocks or mutual funds that consist of stocks. Unless you have lots of experience that can help you discern good stocks from bad, investing in mutual funds reduces the risk considerably. If you want to fine-tune the plan, you can weigh certain categories higher to change your risk/return profile (e.g. equity funds will have higher returns and risk than fixed income (bond) funds, so if you want to take a little more risk you can put more in equity funds and less in fixed income funds). Lastly, don't stress too much over the individual investments.  The most important thing is that you get as much company match as you can.  You cannot beat the 100% return that comes from a company match. The allocation is mostly insignificant compared to that.  Plus you can probably change your allocation later easily and cheaply if you don't like it. Disclaimer:  these are _general_ guidelines for 401(k) investing in general and not personal advice."
The traditional role of a stockbroker is to arrange for the buying and selling of stock by finding buyers and sellers at an agreed upon price.  The broker does not purchase the stock for himself but merely arranges for the stock to be traded. A trader is one who purchases stock with the hope of selling it for a gain.  The trader will use a broker to help with the purchase and sale of a stock.
A mutual fund makes distributions of its dividends and capital gains, usually once a year, or seminanually or quarterly or monthly etc; it does not distribute any capital losses to its shareholders but holds them for offsetting capital gains in future years, (cf, this answer of mine to a different question). A stock pays  dividends; a stock neither has nor does it  distribute capital gains: you get capital gains (or losses) when you sell the shares of the stock, but these are not called distributions of any kind. Similarly, you incur capital gains or losses when you  redeem shares of mutual funds but these are not called distributions  either. Note that non-ETF mutual fund shares are generally not bought and sold on stock exchanges; you buy shares directly from the fund and you sell shares back (redeem them) directly to the fund.  All of the above transactions are taxable events for the year to you unless the shares are being held in a tax-deferred account or are tax-free for other reasons (e.g. dividends from a municipal bond fund).
Stocks aren't just paper -- they're ownership of a company.  Getting cash from a stock that doesn't pay dividends basically means reducing your stake in the company. If the stock pays dividends, on the other hand, you still have the same shares, but now you have cash too.  You can choose to buy more of the company...or, more importantly, to use it elsewhere if that's what you want to do.
"Ditto to MD-Tech, but from a more ""philosophical"" point of view: When you buy stock, you own it, just like you own a cell phone or a toaster or a pair of socks that you bought. The difference is that a share of stock means that you own a piece of a corporation. You can't physically take possession of it and put it in your garage, because if all the stock-holders did that, then all the company's assets would be scattered around all the stock-holder's garages and the company couldn't function. Like if you bought a 1/11 share in a football team, you couldn't take one of the football players home and keep him in your closet, because then the team wouldn't be able to function. (I might want to take one of the cheerleaders home, but that's another subject ...) In pre-electronic times, you could get a piece of paper that said, ""XYZ Corporation - 1 share"". You could take physical possession of this piece of paper and put it in your filing cabinet. I'm not sure if you can even get such certificates any more; I haven't seen one in decades. These days it's just recorded electronically. That doesn't mean that you don't own it. It just means that someone else is keeping the records for you. It's like leaving your car in a parking lot. It's still your car. The people who run the parking lot doesn't own it. They are keeping it for you, but just because they have physical possession doesn't make it theirs."
The mutual fund will price at day's end, while the ETF trades during the day, like a stock. If you decide at 10am, that some event will occur during the day that will send the market up, the ETF is preferable. Aside from that, the expenses are identical, a low .14%. No real difference especially in a Roth.
the difference would be taxes...  Lets say you have two lots, one with a 10 dollar gain, and one with a 20 dollar gain.  And lets say you decide to sell one lot this year, and the other lot in 10 years.  AND, lets say that it turns out the stock price is exactly the same in ten years as it is when you sell the first lot. In all likelyhood, you'll have more income, and therefore you are likely to be in a different marginal tax rate.  If you believe that you're more likely to pay more taxes in 10 years, then sell the lot with the higher gain now.  If you believe you're more likely to pay more taxes now, then sell the lot with the lower gain now.
No. If you didn't specify LIFO on account or sell by specifying the shares you wish sold, then the brokers method applies.  From Publication 551 Identifying stock or bonds sold.   If you can adequately identify the   shares of stock or the bonds you sold, their basis is the cost or   other basis of the particular shares of stock or bonds. If you buy and   sell securities at various times in varying quantities and you cannot   adequately identify the shares you sell, the basis of the securities   you sell is the basis of the securities you acquired first. For more   information about identifying securities you sell, see Stocks and   Bonds under Basis of Investment Property in chapter 4 of Pub. 550. The trick is to identify the stock lot prior to sale.
It's important to distinguish between speculation and investing. Buying something because you hope to make money on market fluctuations is speculation. Buying something and expecting to make money because your money is providing actual economic value is investing.  If Person A buys 100 shares of a stock with the intent of selling them in a few hours, and Person B buys 100 shares of the same stock with the intent of holding on to it for a year, then obviously at that point they both have the same risk. The difference comes over the course of the year. First, Person B is going to be making money from the economic value the company provides over the whole year, while the only way Person A can make money is from market fluctuation (the economic value the company provides over the course of an hour is unlikely to be significant). Person B is exposed to the risk of buying the stock, but that's counterbalanced by the profit from holding the stock for a year, while Person A just has the risk. Second, if Person A is buying a new stock every hour, then they're going to have thousands of transactions. So even though Person B assumed just as much risk as Person A for that one transaction, Person A has more total risk.
Behind the scenes, mutual funds and ETFs are very similar.  Both can vary widely in purpose and policies, which is why understanding the prospectus before investing is so important. Since both mutual funds and ETFs cover a wide range of choices, any discussion of management, assets, or expenses when discussing the differences between the two is inaccurate.  Mutual funds and ETFs can both be either managed or index-based,  high expense or low expense, stock or commodity backed. Method of investing When you invest in a mutual fund, you typically set up an account with the mutual fund company and send your money directly to them.  There is often a minimum initial investment required to open your mutual fund account.  Mutual funds sometimes, but not always, have a load, which is a fee that you pay either when you put money in or take money out. An ETF is a mutual fund that is traded like a stock.  To invest, you need a brokerage account that can buy and sell stocks.  When you invest, you pay a transaction fee, just as you would if you purchase a stock.  There isn't really a minimum investment required as there is with a traditional mutual fund, but you usually need to purchase whole shares of the ETF.  There is inherently no load with ETFs. Tax treatment Mutual funds and ETFs are usually taxed the same.  However, capital gain distributions, which are taxable events that occur while you are holding the investment, are more common with mutual funds than they are with ETFs, due to the way that ETFs are structured.  (See Fidelity: ETF versus mutual funds: Tax efficiency for more details.)  That having been said, in an index fund, capital gain distributions are rare anyway, due to the low turnover of the fund. Conclusion When comparing a mutual fund and ETF with similar objectives and expenses and deciding which to choose, it more often comes down to convenience.  If you already have a brokerage account and you are planning on making a one-time investment, an ETF could be more convenient.  If, on the other hand, you have more than the minimum initial investment required and you also plan on making additional regular monthly investments, a traditional no-load mutual fund account could be more convenient and less expensive.
Also important to keep in mind is the difference in liquidity. The stock could be very liquid in 1 exchange but not in another. When times get bad, liquidity could dry up 1 one exchange, which results in a trading discount.