buy stocks

Marketing timing strategies like “buy low, sell high” make sense of past market movements, but are pretty much useless at predicting the future.

Profiting from the global stock market has never been easier for investors

This will be our last Inner Circle Q&A for 2015. Our next issue will go out on Tuesday, January 5, 2016.

Now is a good time for me to say “Thanks!” to all our Inner Circle members. It’s a pleasure to read and answer your questions. I take great pleasure and pride from the many compliments and expressions of gratitude you send every week.

That’s especially true when I hear from a member who I recognize from decades ago—from the early days after the 1994 launch of The Successful Investor, or from the two prior decades that I spent at The Investment Reporter and MPL Communications.

It’s also great to see that our Successful Investor philosophy and practice have begun attracting more and more younger investors.

I wish you all a great year-end holiday and a healthy, happy and prosperous New Year!

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Invest like fabled investor Warren Buffett by looking for long-term fundamental value.

Mutual funds, index funds and exchange traded funds (ETFs) often engage in securities lending. That is, they lend securities to third-party borrowers, mostly hedge funds and investment firms. These borrowers then mainly use them for short selling. That is, they sell the securities with the hope of buying them back at a lower price. This is, of course, a way of speculating on a share price decline.

The lending institution or fund receives all the dividends and interest it was entitled to as an investor in the security, plus a fee for making the securities loan.

There is negligible risk of losing money on the loan, since the borrower puts up collateral of at least 102% of the borrowed securities’ value. This collateral typically consists of cash, T-bills or highly rated short-term debt instruments. The borrower is liable for any shortfall between the value of the collateral and the value of the securities. If the value of the securities rises, the borrower has to add to the collateral on a daily basis to maintain coverage at 102%.

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Far better to base investment decisions on hard facts rather than stock market predictions

Rules you need to follow when buying mutual funds for the long-term success of your portfolio.

One growth stock investing cliché says “don’t fall in love with your stocks,” but you shouldn’t fall out of love with a stock so soon that you miss a winner.

This week’s first question helps illustrate a common practice in today’s investment business, particularly in ETFs (Exchange Traded Funds). ETFs are a little like conventional mutual funds, but with two key differences. First, ETFs trade on a stock exchange throughout the day, much like ordinary stocks. So you can buy them through a broker whenever the stock market is open, and generally you pay the same commission rate that you pay to buy stocks. In contrast, you can only buy most conventional mutual funds at the end of the day. Commissions vary widely, depending on negotiation with your broker for fund dealer....

Investors can use special ETFs called bear funds to hedge their positions in a market downturn.