Archives July 2013

Should You Borrow On Margin To Invest In Stocks?

Last update on July 31, 2013.

Here's the good thing about margin accounts - they let you borrow money to invest.

Note that you can only borrow money using margin accounts. You can't borrow on margin using TFSAs and RRSPs.

How To Borrow On Margin

Margin accounts are fully taxable, which is why I recommend filling up your TFSAs first, but for young professionals, the ability to borrow gives the margin account another leg up on RRSPs.

How much can you borrow? That depends on a formula that I don't want to get into right now. There's a quick way to check, though ...

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Dividends' Effect On Short Term Stock Prices

Last update on Jan. 16, 2015.

 

If you take a look at around the personal finance blogosphere (This link shows you a list of blogs), you'll see that almost everybody likes dividend stocks. Some of the bloggers who invest based on dividends include 'The Million Dollar Journey', 'Boomer And Echo', 'Young And Thrifty', and many many more. Some blogs even have the word 'Dividend' right in their names!

To be sure, I don't have anything against these bloggers for choosing to invest in dividend stocks. In fact, I like some of the blogs I mentioned. However, I don't think their investment strategy ...

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Weekend Roundup: Stocks, Europe, Japan, Oil

Last update on July 26, 2013.

Oil well

Every Friday, we bring you noteworthy news articles that affects your investments.

Investors Are Selling Bonds And Buying Stocks

For years, investors had poured more money into buying bonds than buying stocks. The reason is simple: people were afraid to invest in stocks. Now, that trend is reversing as stocks outperformed bonds by quite a big margin recently. More money pouring into stocks will likely push stock prices higher.

Europe's Economy Finally Doing Better

The Euro crisis really took its toll on the Europeans. Their unemployment went up, and their economy was in shambles. However, things are looking better ...

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How Modern Portfolio Theory Works

Last update on Feb. 19, 2015.

Risky business: Modern Portfolio Theory aims to reduce risk in a portfolio without sacrificing returns

 

At MoneyGeek, we use a variation of Modern Portfolio Theory (MPT) extensively to construct our portfolios. In this article, I will explain what MPT does.

 

Optimizing A Portfolio Of Two Stocks

Let me explain MPT by way of a hypothetical example. Let's say we have two stocks from corporations ABC and XYZ. Both stocks trade at $10 per share in year 0.

At the end of year 1, ABC goes down by 20%, while XYZ goes up by 50%. In year 2 ...

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My TFSA Update June 2013 - Introduction

Last update on July 21, 2013.

Goals

This is the first in a series of podcasts, where I'll share details about my own TFSA account.

In this episode, I'll talk about how much my TFSA account was worth at the end of June 2013, and I'll talk about my long term goals for the account.

 

 

Transcript:

Hello and welcome. My name is Jin Choi, and you're listening to the MoneyGeek podcast.

Today, I want to start something new. I've decided that I'm going to share some of the details of my own TFSA account. Every month, I'll post ...

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Weekend Roundup: Iran vs Israel, Bank of Canada, Detroit, McDonald's

Last update on July 19, 2013.

McDonald's logo

Every Friday, we bring you noteworthy news articles that affects your investments.

Israel Warned Iran About Its Nuclear Program

Why are gasoline prices going up? Because oil prices are going up. But then why are oil prices going up? One contributing factor is this rhetoric from Israel. If war breaks out between Israel and Iran, you'll see oil prices shoot up dramatically. Traders have bought oil on this possibility - hence the rise in oil prices.

Bank Of Canada Kept Rates And Outlook Steady

The Bank of Canada (BoC) controls the short term government interest rate, which in turn affects ...

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How Much Do Financial Advisors Charge, Really?

Last update on July 17, 2013.

Money origami

A few of my friends have financial advisors. When I ask them how much they think the advisor is costing them, I usually get a very confused response.

"Don't they work for free?"

is sometimes what I hear. Others say that they're aware that mutual funds are charging them roughly 2% per year. When I ask them if they think that's too much, they shrug their shoulders. 2% doesn't sound like a lot.

Until, I ask them the following.

"If you have $50,000 in mutual funds, 2% is $1,000 per year. Are you happy ...

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Reason #3 Why Markets Are Not Efficient: Too Much Focus On Short Term

Last update on Sept. 19, 2013.

Musical chairs

"They are dancing in a room in which the clocks have no hands." - Warren Buffett

The 'Efficient Market Hypothesis' (EMH) is like a religion. Believing in it has a dramatic influence on the way you actually invest. Plenty of financial advisors believe in EMH, which makes this subject very relevant for us. In this series, we discuss what EMH is, why it's wrong and why that matters.

In part 4, I raised another big objection to EMH, namely that people often make decisions using their emotions, rather than cold hard logic.  In this instalment, I explain another reason why ...

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Weekend Roundup: China, Taper, Budget Surplus, Glass-Steagall

Last update on July 19, 2013.

 Former senators Carter Glass and Henry Steagall

Picture: Former senators Carter Glass and Henry Steagall

Every Friday, we bring you noteworthy news articles that affects your investments.

Chinese Import And Export Data Was Discouraging

When a country imports and exports a lot, that's usually a good indicator that the country's economy is healthy. This is especially true for China, which grew by importing raw materials, and exporting finished goods. This past week, data came in suggesting that their imports and exports are slowing down, which are making people nervous about the state of their economy.

Bernanke Calmed Markets About Taper

The chairman of the ...

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A Financial Math Professor's Take On MoneyGeek And Financial Advice

Last update on July 10, 2013.

We interviewed Professor Matt Davison from the University of Western Ontario. We asked about his thoughts on MoneyGeek's services, and we also asked what advice he would give to young professionals who are looking to invest their savings. Duration: 20 minutes.

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