Bonds issued by the U.S. Treasury, typically in amounts ranging from $50 to $10,000. Savings bonds are noncallable -- which means the government cannot retire them before the maturity date -- and are also nontransferable, which means that bondholders cannot transfer them to someone else. Because savings bonds are backed by the full faith and credit of the federal government, many investors consider them to have relatively low investment risk.
State-sponsored, tax advantaged plans that encourage individuals to invest in a pool of stocks and bonds for college savings. Contribution limits for Section 529 Plans vary from state to state. Generally, the asset allocation formula may be determined by a child's age (generally more aggressive for younger children and more conservative as children approach college age) or may be selected by the investor based on his or her risk tolerance. Distributions made to pay qualified education expenses are tax free.
Funds that invest in specific industries and economic niches to seek above-average returns. Their narrow focus may make them more volatile than broadly diversified funds and more vulnerable to single economic, political, or regulatory developments.
Indicator to sell a stock. Conditions of the signal will be determined by the indicator.
Bonds issued by the U.S. government at a 50% discount from par. Also known as Energy Savings Bonds, non-marketable Series EE bonds come in denominations of $25, $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000. Series EE Bonds replaced Series E Bonds and are subject to the same taxes.
Shares issued by small companies, typically with market capitalizations of $2 billion or less.
Statistical measure that shows the likelihood of an investment to yield above- or below-average returns over a period of time. For example, if hypothetical XYZ Fund has an average annual total return of 11% and a standard deviation of 6.00, that means XYZ Fund's performance is likely to vary from a low of 5% to a high of 17%. Calculated by the fund, standard deviation is only relative to the asset class being measured.
Share of ownership in a company, typically traded on one or more exchanges. Owners of stock usually receive voting rights on issues affecting the company and may receive a portion of the company's profits in the form of dividends.
An order sell a stock when it reaches a certain price. The Stop Loss Order goal is to limit a loss. Stop Loss Order removes the emotion from trading decisions and can be helpful when an investor cannot watch his position. Keep in mind that execution is not guaranteed.
Estate planning concept used to extend the financial life of an IRA across multiple generations. The strategy lets an IRA's original beneficiary transfer, upon death, the IRA assets to his or her own beneficiary without triggering an immediate income tax liability. Such flexibility provides an opportunity to stretch an IRA's tax-deferred growth potential longer than initially intended.