Home / Markets / Mutual Funds & ETFs
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Monday, September 21, 2009
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Sunday, September 20, 2009
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Friday, September 18, 2009
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Friday, September 18, 2009
New ETNs allow investors to bet on a resurgence in market volatility.
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Friday, September 18, 2009
INVESTMENT STRATEGIES
- Buy Order: Natural Gas May Be the Place to Be
- Fund Manager Touts Naspers as 'Defensive' Media Play
- Avon Stock May Be a Good Call Due to China Growth
- Transocean Is a Good Buy, One Fund Manager Says
- Cashing in on Health Care via China
- Biotech Firm Becton Dickinson a Safe Bet
- Is There Still Any Money in the Dial-Up Biz?
- AmeriIsrael's Jasper Recommends Teva Pharmaceuticals
- Fund Manager Says Euro to Stay Strong Despite Europe's Dismal Growth
- With Population Growing, Syngenta Stands to Benefit
FEATURES / RECOMMENDED READING
- ETNs Allow Bets on Increasing Market Volatility
- Report Criticizes SEC Over Madoff Scheme
- Fund Manager Touts Naspers as 'Defensive' Media Play
- WSJ: Van Kampen Fund Unit Attracts Potential Buyers
- Vanguard Closes Primecap Core Fund to New Investors
- Janus Capital CEO Black Resigns
- Legg Mason Cuts Dividend, Reports Widened Loss
- Forget 1933 -- Obama Won't Torpedo G-20 Progress
- These 2 Funds Beat Benchmarks a 10th Straight Year
- Fund Manager Stays the Course on Merck & Co.
Fox Business Video
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Evening Market Report 9-21-09
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Business Report: Evening markets
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Gold, China Portfolio 'Musts'
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Sep 21, 2009
U.S. debt is driving gold
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NYC Realtor to Qaddafi: No Rental!
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Sep 21, 2009
Al-Qaddafi denied rental for U.N visit
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Top White House Economist on I...
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Sep 21, 2009
How innovation will help the economy
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Translating Earnings Reports
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Sep 21, 2009
Playing the earnings game
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Think telemarketer. Except, it's much worse because you can't avoid this call. Instead, when you get one, it's time to pay up, because the bet you placed with borrowed money is eating itself.
Buying stocks on margin is risky because you're essentially "playing" with someone else's money. If the shares you purchased tank, your losses will likely be more than if you had bought the shares with your own cash. This is why the New York Stock Exchange and the Nasdaq impose certain restrictions on the practice.
Initially, you¿re only allowed to borrow half of the money from your broker when buying on margin. You set up a margin account and from then on must keep a maintenance balance of at least 25% of the market value of your stocks.
If the market value of your investment falls below this minimum, you're required to make up the difference by either depositing money into your account or selling some of the stock. If your broker notifies you that you've dipped below this minimum, it's called a margin call.
If you fail to adjust your account accordingly, the broker is authorized to sell shares in your account to make up the difference. The broker can even sell other stock in your margin account to make up for the loss that selling the shares didn't cover.
As an example, say you buy $8,000 in stocks of any given company. You borrow the maximum $4,000 from your broker and pay the rest yourself. Now, if and when the total value of these shares changes, you must make sure you maintain at least $2,000 (25%) in equity. In other words, if the total value were to drop below $6,000, you¿d be in trouble since you only put in $4,000 of your own money to begin with.