Investing Basics
Getting started with stocks, IRAs, compound interest, and long-term investing
78 articles in this category
What Is a Stock? How the Stock Market Works
A stock represents ownership in a company. Learn how stocks work, why companies issue them, and how the stock market connects buyers and sellers.
Compound Interest: The Most Powerful Force in Investing
Compound interest makes your money grow exponentially over time. Learn the formula, see real examples, and understand why starting early matters so much.
What Is Equity? Equity in Stocks, Business & Real Estate
Equity means ownership value after debts. Learn what equity means for stocks, businesses, and real estate, and why it is a cornerstone of investing.
What Is a Roth IRA? Rules, Limits & How to Open One
A Roth IRA lets your investments grow tax-free. Learn the rules, contribution limits, income eligibility, and step-by-step instructions to open one.
Dollar-Cost Averaging: The Simplest Strategy That Works
Dollar-cost averaging removes emotion from investing by putting a fixed amount in on a regular schedule. Learn why DCA works and how to implement it.
Index Funds: What They Are & Why Most Investors Should Own Them
Index funds offer broad market exposure at ultra-low cost. Learn what they are, how they work, and why they outperform most actively managed funds.
What Is Inflation? How It Affects Your Money & Investments
Inflation erodes your purchasing power over time. Learn what causes inflation, how it affects different asset classes, and strategies to protect yourself.
Roth IRA Contribution Limits: How Much Can You Invest?
Know exactly how much you can contribute to your Roth IRA. Get the latest limits, income phase-out ranges, and tips for maximizing your contributions.
What Is a Bond? How Bonds Work for Investors
Bonds are loans you make to governments or companies in exchange for interest payments. Learn bond basics, types, and how they fit in a portfolio.
Traditional IRA: Rules, Tax Benefits & Contribution Limits
A traditional IRA offers tax-deductible contributions and tax-deferred growth. Learn the rules, limits, and how it compares to a Roth IRA.
How to Start Investing in Stocks: A Beginner's Roadmap
Ready to start investing? This step-by-step roadmap covers opening an account, choosing your first investments, and building a plan that fits your goals.
Blue Chip vs Growth vs Value Stocks: Which to Buy
Blue chip, growth, and value stocks serve different roles. Learn the characteristics of each style and how to allocate based on your goals and risk tolerance.
ESG Investing: What It Is & How to Build a Responsible Portfolio
ESG investing considers environmental, social, and governance factors alongside financial returns. Learn how to build a responsible portfolio that performs.
What Is Liquidity? Why It Matters for Every Investor
Liquidity measures how easily an asset can be bought or sold at a fair price. Learn why liquidity matters and how it affects your trading and investing.
What Are Assets? Types, Examples & Why They Matter
Assets are resources with economic value. Learn the different types — stocks, bonds, real estate, commodities — and how they work together in a portfolio.
What Is a Dividend? How Dividends Work for Stock Investors
Dividends are cash payments companies make to shareholders. Learn how they work, when you get paid, and what to look for.
Dividend Yield: Formula, What's Good & How to Use It
Dividend yield tells you how much income a stock pays relative to its price. Here's how to calculate and interpret it.
Dividend Stocks: How to Find & Evaluate Income-Paying Shares
Not all dividend stocks are created equal. Learn what separates sustainable payers from yield traps.
Ex-Dividend Date: When You Must Own to Get Paid
Miss the ex-dividend date by one day and you don't get paid. Here's exactly how the timing works.
Dividend Payout Ratio: What It Tells You About a Stock
A 90% payout ratio is a red flag. A 30% ratio means room to grow. Learn what the payout ratio reveals.
What Is a REIT? Real Estate Investment Trusts Explained
REITs own income-producing real estate and must pay 90% of taxable income as dividends. Here's how they work.
How to Invest in REITs: Types, Risks & Best Approaches
You can invest in REITs through brokerage accounts just like stocks. Here are the best approaches by risk level.
Preferred Stock: What It Is & How It Differs from Common Stock
Preferred stock is a hybrid between stocks and bonds. Fixed dividends, priority in liquidation, but limited upside.
Stocks vs Bonds: Key Differences & How to Allocate
Stocks give you ownership. Bonds make you a lender. Here's how they compare and when to hold each.
What Is an ETF? Exchange-Traded Funds Explained
ETFs combine the diversification of mutual funds with the tradability of stocks. Here's how they work.
What Is a Mutual Fund? How Mutual Funds Work
Mutual funds let you invest in a professionally managed portfolio. Here's how they work and what to watch for.
ETF vs Mutual Fund: Key Differences & Which to Choose
ETFs and mutual funds both offer diversification, but they differ in trading, fees, and tax efficiency.
ETF vs Stock: When to Trade Each & Why
One share of an ETF can hold hundreds of stocks. Here's when to pick ETFs over individual stocks.
Leveraged ETFs: How They Work, Risks & Why They Decay
Leveraged ETFs multiply daily returns — but daily rebalancing causes decay over time. Here's how it works.
Inverse ETFs: How to Profit When the Market Falls
Inverse ETFs let you bet against the market without short selling. But they're designed for one-day holds.
DRIP: How Dividend Reinvestment Compounds Your Returns
DRIPs automatically reinvest dividends into more shares. Over decades, the compounding effect is massive.
Monthly Dividend Stocks: Build a Recurring Income Stream
Most companies pay quarterly. These REITs and stocks pay monthly — useful for building recurring income.
Dividend Capture Strategy: Does Buying Before Ex-Date Work?
Buy before ex-date, collect dividend, sell. Sounds easy — but the stock drops by the dividend amount. Here's the math.
Dividends Per Share (DPS): Formula, Calculation & Meaning
DPS tells you exactly how much cash each share earns in dividends. Here's the formula and how to use it.
The Stock Market Explained: How It Works for Beginners
The stock market is where millions of buyers and sellers set prices for company shares every second. Here's how it all works.
Portfolio Diversification: Why It Matters & How to Do It Right
Diversification is the only free lunch in investing. Spread risk across assets, sectors, and geographies.
Asset Allocation: How to Split Your Money Across Investments
Asset allocation — how you split money among stocks, bonds, and cash — drives 90% of your portfolio's returns over time.
Long vs Short Positions: How Both Sides of a Trade Work
Long positions profit when prices rise. Short positions profit when prices fall. Learn the mechanics of both.
Hedging: How to Protect Your Portfolio from Losses
A hedge offsets potential losses in your portfolio. Learn the most common techniques — from puts to inverse ETFs.
What Is Yield? Types of Investment Yield Explained
Yield is the income an investment generates relative to its price. Learn the different types and why they matter.
Best Stocks for Beginners: What to Look for in Your First Trades
Not all stocks are good for beginners. Learn what to look for — liquidity, stability, and manageable volatility.
Liquid Net Worth: What It Is & How to Calculate Yours
Liquid net worth is the portion of your wealth you can convert to cash quickly. Learn the formula and why it matters more than total net worth.
What Is a Stock Market Index? S&P 500, Dow & Nasdaq Explained
A stock market index measures the performance of a group of stocks. Learn how the S&P 500, Dow, and Nasdaq are built and used.
What Are Equities? Stocks, Equity Markets & Ownership
Equities are ownership shares in a company. Learn what they are, how equity markets work, and why stocks are called equities.
Custodial Accounts (UGMA/UTMA): Investing for Minors
Custodial accounts let adults invest for minors under UGMA or UTMA rules. Learn how they work and the tax implications.
The 50/30/20 Budget Rule: How to Allocate Your Income
The 50/30/20 rule splits your income into needs, wants, and savings. Learn how to apply it and put the savings portion to work.
Residual Income: What It Is & How to Build It
Residual income keeps paying after the initial work is done. Learn the types — dividends, royalties, rent — and how to build streams.
Royalties: What They Are & How Investors Earn Them
Royalties are recurring payments for the use of an asset. Learn the types — mineral, music, patent — and how investors earn them.
Average Stock Market Return: Historical Data & What to Expect
The stock market has averaged about 10% per year historically. Learn the data behind that number and what it means for your portfolio.
Value Investing: How to Find Undervalued Stocks
Value investors buy stocks trading below intrinsic value. Learn the strategy, the key ratios, and how to find undervalued companies.
Fiat Currency: What It Is & Why It Matters to Investors
Fiat currency is money backed by government trust, not gold. Learn how it works, why inflation matters, and what it means for investors.
Futures Contracts: What They Are & How They Differ from Options
Futures contracts obligate both parties to transact at a set price on a future date. Learn the mechanics and how they compare to options.
Futures Trading: How It Works, Margin & Contract Specs
Futures let you trade commodities and indexes with leverage. Learn the margin requirements, contract specifications, and trading mechanics.
History of the Stock Market: From the Dutch East India Company to Today
The stock market started in 1602. Learn the key milestones — from the Buttonwood Agreement to electronic trading.
Growth Investing: How to Find Stocks with Explosive Earnings
Growth investing targets companies growing faster than the market. Learn the strategy, the metrics, and the risks of high valuations.
Income Investing: Building a Portfolio That Pays You Monthly
Income investing prioritizes cash flow from dividends and interest. Learn to build a portfolio that pays you every month.
Robo-Advisors: How They Work & Whether They're Worth It
Robo-advisors build and manage portfolios using algorithms at low cost. Learn how they work and whether they are right for you.
Fractional Shares: How to Invest with Any Amount of Money
Fractional shares let you buy a slice of expensive stocks like AMZN or BRK.A. Learn how they work and the trade-offs.
What Is a Fiduciary? Why It Matters When Choosing an Advisor
A fiduciary must act in your best interest. Learn the difference from suitability standard and why it matters when choosing an advisor.
Dollar Returns vs Percentage Returns: Why Both Matter
A 10% gain on $1,000 is $100. On $100,000 it is $10,000. Learn why both perspectives matter for trading decisions.
Time in the Market vs Timing the Market: What the Data Says
Missing just the 10 best days over 20 years cuts your returns in half. Learn why staying invested beats trying to time the market.
Types of Bonds: Corporate, Municipal, Treasury & More
Corporate, municipal, treasury, savings, junk — each bond type carries different risk and return profiles.
TIPS: Treasury Inflation-Protected Securities Explained
TIPS adjust their principal value with inflation, protecting your purchasing power.
Equity Markets: What They Are & How They Work
Equity markets are the exchanges and systems where stocks are bought and sold.
Types of Inflation: Demand-Pull, Cost-Push & Built-In
Demand-pull, cost-push, and built-in inflation each have different causes and effects on the economy.
MSCI Index: What It Is & Why Global Investors Watch It
MSCI indexes are the global benchmarks that institutional investors use to track markets worldwide.
Money Market Accounts: What They Are & How They Compare
Money market accounts earn higher interest than savings accounts and are FDIC insured up to $250,000.
Face Value & Par Value: What Bonds Are Worth at Maturity
Face value is what a bondholder receives at maturity. Most bonds have a par value of $1,000.
Bonds vs Stocks: Risk, Returns & When to Own Each
Stocks and bonds serve different roles in a portfolio. Compare risk, returns, and how each one works.
ETF vs Mutual Fund: Costs, Tax Efficiency & Flexibility
ETFs and mutual funds both hold baskets of assets, but they trade differently and are taxed differently.
Futures vs Forwards: Standardized vs Custom Contracts
Futures are standardized and exchange-traded. Forwards are customized and trade over the counter.
ETF vs Stock: Diversification vs Individual Picks
Stocks concentrate your bet on one company. ETFs spread it across dozens or hundreds.
Net Worth vs Liquid Net Worth: Total Wealth vs Accessible Cash
Net worth counts all assets. Liquid net worth only counts what you can access quickly — stocks, cash, bonds.
Dow vs S&P 500: Two Benchmarks, Different Pictures
The Dow has 30 stocks and is price-weighted. The S&P 500 has 500 stocks and is market-cap-weighted. They tell different stories.
Treasury Bills vs Bonds: Maturity, Yield & How They Pay
T-bills are short-term and sold at a discount. T-bonds are long-term and pay coupons. Both are backed by the U.S. government.
SIPC vs FDIC: How Your Accounts Are Protected
FDIC covers your bank. SIPC covers your brokerage. Neither protects you from losing money on bad trades.
What Is Dividend Yield?
Dividend yield expresses the annual dividend income a stock pays as a percentage of its current share price — the most common metric for comparing dividend stocks.
How to Start Investing
The most important investing decision you can make is to start now — compound interest turns small, consistent investments into substantial wealth over time.