Investing Basics

Featured Article

Why You Should Care Less About the Dow Jones Industrial Average

The Dow is a relic of another age and it is truly remarkable how heavily its movement influences the market news cycle. It has been around since the late 1800s, when Charles Dow and Edward Jones decided that they needed a more efficient proxy for the broader stock market so that investors could have a rough idea of how the markets were performing (it wasn’t quite as easy to get real-time market data back in those days).

by Max Kirouac
Investing Basics, Money Management

Sequence of Returns Risk: Why Average is a Lie

If you had invested $10,000 at the beginning of 1981, it would have been worth about $780,000 by the end of 2020. However, this statistic doesn't really tell the full story. This is why it's important to understand sequence...

Investing Basics, Money Management

Which Investment Platform is Right for Me? Wealthsimple or Interactive Brokers?

In our last article, we compared two of Canada’s leading low-cost investment platforms: Wealthsimple Trade and Questrade. In this article, we are going to consider another low-cost option that is lesser known north of the border: Interactive Brokers Canada.

Investing Basics, Money Management

Zero-Commission Trading Announced by National Bank

National Bank Direct Brokerage has announced zero-commission and fees on online trading of Canadian and U.S. stocks and ETFs...

Investing Basics, Money Management
Target Date Funds: What You Need to Know if You Own Them

Over the forthcoming years, target date funds (used as a passive investment strategy) will force investors to sell their stocks to purchase bonds with near all-time low interest rates, drastically hampering the portfolio's future performance. As interest rates fell, bond prices have increased, meaning investors will be paying a premium price for bonds purchased while the interest rates designed to fund a retirement income stream will not deliver the same type of income they once did...

Investing Basics, Money Management
Share Buybacks 101: Everything You Need to Know

Buybacks are a tool for returning value to shareholders. When companies post a profit at the end of the year, they have some options for what to do with the cash...

Investing Basics, Money Management
ESG Investing: What it is & Why it’s Important

ESG stands for Environmental, Social, and Governance. ESG Investing refers to understanding these non-financial elements to better assess potential risks and make more informed investment decisions...

Investing Basics, Money Management
Will Higher Capital Gains Taxes Crash the Market?

Speculation is mounting that capital gains inclusion rates could increase significantly, perhaps including 100% of capital gains as income. The question is, how would this change impact investors?

Investing Basics, Money Management

Following Cathie Wood & Warren Buffett? What You Need to Know Before Blindly Following the Big Names

Cathie Wood is the latest in a long list of investment managers to be put on a pedestal on the strength of recent performance or one fantastic call...

Featured Article

Understanding Short Selling & Short Squeezes in the Stock Market

For the first time in years, Blackberry, Nokia, and AMC are in the news. Trading activity has brought a number of once-great monoliths back from the grave, none more so than GameStop – the brick and mortar video game retailer, which traded as low as $3.94 in late July 2020, hit an all-time high of $483 on January 28, 2021 amidst a frenzy of retail trading...

by Max Kirouac
Investing Basics, Money Management

Understanding the Basics of Portfolio Rebalancing

Rebalancing is the act of periodically reviewing the asset allocation in your portfolio and, if the balance is “off” from your original intention, then investments are reallocated to ensure your portfolio is restored to your original goal...

Investing Basics, Money Management

Which Investment Platform is Right for Me? Wealthsimple or Questrade?

For many people – especially beginners – the world of investments can seem like a daunting place. Financial jargon is notoriously difficult to understand, and the myriad of choices available in products, strategies, and brokerages can be overwhelming. For most, however, investing doesn’t have to be so complicated...

Investing Basics, Money Management

What is the 2021 TFSA Contribution Limit?

Wondering what the 2021 TFSA contribution limit will be? Well, the wait is finally over as it has officially been announced. The 2021 limit is $6,000, matching the amount set in 2019 and 2020...

Investing Basics, Money Management

The Power of Average – Dollar Cost Averaging 101

When it comes to succeeding in long-term investing, winning pretty much boils down to not losing. If there’s one thing history has taught us, it’s that the stock market’s long-run projection is inevitably upward...

Investing Basics, Money Management

Robo-Advisors vs. Human Advisors: What’s Best For You?

Exploring investing options outside traditional investment advisors – like robo-advisors or DIY investing – saves you a lot of money in fees while producing the same (or sometimes better) results. While the difference in fees between these options seems small, the compounding effects can actually help you retire years earlier...

Investing Basics, Money Management

Robo-Advisors vs. Human Advisors: What’s Best For You?

Exploring investing options outside traditional investment advisors – like robo-advisors or DIY investing – saves you a lot of money in fees while producing the same (or sometimes better) results. While the difference in fees between these options seems small, the compounding effects can actually help you retire years earlier...

Investing Basics, Money Management

ETF versus Mutual Fund: What You Need to Know Before Investing

The differences between these two investment vehicles are often overestimated. Ultimately, they are vehicles through which financial companies can deliver portfolios to interested investors...

Investing Basics, Money Management

Sports Betting and Stock Picking: What You Need to Remember

In many ways, stock picking is a lot more like betting on sports and displays a lot of the same psychological biases...

Investing Basics, Money Management

Understanding Home-Bias in Investing & What You Need to Consider

Home-bias investing is the practice of investing a disproportionate amount of your portfolio in domestic companies, often at the expense of diversification, and capital efficiency...

Investing Basics, Money Management

Why do Companies Split Their Stock? What You Need To Know

The primary reason companies split their stock is to increase the liquidity of their shares. Take Apple for example. As of market close on August 4, Apple’s stock is trading at $438.66 US (about $584 CAD). For a beginner’s investment portfolio, a single share of Apple stock may prevent adequate diversification...

Investing Basics, Money Management

Primer on Stock Dividends – What You Need to Know Before Buying

Dividends are derived from a company’s excess cash flow (i.e. the money left over after a company has met all of its obligations, including administrative expenses and debt payments). After obligations are met, a company is left with the option to either retain that excess cash for future investment or pay it out to shareholders...

Investing Basics, Money Management

Timing the Markets vs. Time in the Markets

The appeal behind timing the market is tied to the age-old adage of buy low, sell high. History has proven that investing for a sufficiently long time frame, no matter the start and end points, will accomplish this goal...

Investing Basics, Money Management

Why Companies Split Their Stock: Slide Series Edition

Ever wonder why publicly traded companies split their stock? Use this slide deck to understand their rationale for doing so alongside a recent example of Apple’s stock split that most recently occurred on August 31, 2020...

Investing Basics, Money Management

How to Invest in a TFSA: Slide Series Edition

Use this quick slide series guide to learn the basics of how to invest in a TFSA...

Investing Basics, Money Management

Fixed Income – Your Primer on How it Can Benefit Your Investment Portfolio

Fixed income is comprised of the debt of corporations, governments, and individuals (in the form of mortgage-backed securities). Given that debt holds a senior position to equity and is therefore safer, the returns on fixed income are lower (and less volatile) than the returns on equities...

Investing Basics, Money Management

4 Reasons Why You (probably) Shouldn’t Day Trade

When it comes to investing, knowing a little bit is much more dangerous than knowing nothing. When I first started learning about trading, I thought that I could learn everything I needed to know to make profitable trades in a matter of weeks. I didn’t realize the extent of my own ignorance, as I somehow believed that every piece of information I consumed was available only to me and I could simply outsmart all other market participants...

Investing Basics, Money Management

Investment Strategies 101: What to Look For

Given the high stakes involved with stock market participation, countless investment strategies have been developed to try to outperform the market. These range from fundamental analysis of financial metrics to tracking the patterns that are produced when a stock’s price is plotted on a line graph...

Investing Basics, Money Management

The Little Book of Common Sense Investing

The Little Book of Common Sense Investing is an ideal starting point for anyone wishing to expand their financial literacy. There are no get-rich-quick proclamations or vague anecdotes presented as “proof” of successful investment strategies. Instead, Bogle’s presents a clear message: the vast majority of investors should target the market return and ignore the cost-laden, inconsistent strategies preached by active fund managers...

Investing Basics, Money Management

Your Investment Portfolio Just Dropped 10%. What Do You Do Now?

Making wise decisions results from good process. Develop your process, follow it, and let everyone else worry about the noise. Use these 4 investing tips when the market drops...

Investing Basics, Money Management

What is an RRSP & is it Right for You?

An RRSP is a tax-advantaged account. This means that it allows you to contribute to your RRSP and the amount that you do contribute will be exempt from your total taxable income for the year that you make the contribution...

Modern Money sources its content from independent contributors and, although Modern Money strives to ensure accurate and up-to-date content, information can change and therefore you should critically assess and cross reference all information on Modern Money with your own sources and information before making any personal/financial decisions.
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