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4 Hidden Costs in Investing
Tweet Share on Facebook February 8, 2011 Comment (3)Like most things in life, when it comes to your investments, you get what you pay for. In other words, if an investment costs less, it might not be the best product you can buy. When you go grocery shopping, do you try to save money by buying the store brand of toaster pastries that costs less instead of Pop-Tarts? They look the same on the box, but we all know Pop-Tarts taste better.
Don’t choose an investment just because it costs less, but make sure you’re not paying too much either. It may seem overwhelming to watch for costs when you’re choosing among the thousands of investments available, but it’s not that difficult. You just have to know what the different costs are.
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Why the S&P 500 Is Still a Bargain
Tweet Share on Facebook February 4, 2011 CommentJ.P. Morgan Asset Management publishes some great market research at the end of every quarter called the "Guide to the Markets." It is chock-full of good data, but when reading the most recent issue, one page really stood out to me. The page asked a simple question: Is the S&P 500 over-bought?
No. At least not according to some data found in the guide. Here's why:
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ETF Basics: Invest Globally, but Cautiously
Tweet Share on Facebook February 3, 2011 CommentNot all foreign stock investments are created equal. In a prior article, we wrote about owning stocks in companies based in emerging markets (Brazil, Russia, India, China) and the different types of risks and returns one can expect. The exciting growth in these countries also comes with a fair amount of risk, including governments with onerous tax rates, state-imposed price controls, outdated securities laws, corruption, or risk of wars and violence.
Egypt brings these risks home. If you want to invest in the Egyptian stock market, you can purchase shares of an exchange-traded fund (ETF) called the Market Vectors Egypt Index ETF (symbol EGPT), which holds all the important stocks in Egypt. When protests broke out last week, the markets decided that all of the largest companies in Egypt were worth 25 percent less than they were a day before, and EGPT fell by that amount!
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Why You Should Buy Consumer Staples Stocks
Tweet Share on Facebook February 2, 2011 CommentSodas, macaroni and cheese, cigarettes, gum, salt, ketchup, and medicine are all things we use regardless of which direction the stock market is trending. These items are all part of the consumer staple market sector. They also can and should play a part in your portfolio in 2011.
Here are three reasons to consider consumer staples for your portfolio:
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Why Boring is Good for Investors
Tweet Share on Facebook February 1, 2011 Comment (1)When reviewing your portfolio, you might think: All I own are mutual funds. Maybe I should buy that new exchange-traded fund the experts on TV are bragging about. Perhaps I should add to my commodities holdings since gold, silver, and other metals were so hot last year.
Here's my advice to anyone who thinks they need to spice up their investments: Don't do it. Mutual funds are the most tried-and‑true investments around. Yes, they're boring. Mutual funds usually don't have a blowout quarter in earnings or announce share buybacks or two‑for‑one stock splits. There's just not a lot of buzz surrounding them. If what you're after is entertainment, go gambling in Las Vegas. But if you want to accumulate money for your retirement and other goals, mutual funds are the way to go.
[See top-rated funds by category ranked by U.S. News Score.]
