What is Value Investing?

From Investopedia  What Does Value Investing Mean?The strategy of selecting stocks that trade for less than their intrinsic values. Value investors actively seek stocks of companies that they believe the market has undervalued. They believe the market overreacts to good and bad news, resulting in stock price movements that do not correspond with the company’s…

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What is Compounding?

Compounding occurs when you add your investment earnings or savings account interest to your original investment, forming a larger foundation upon which future earnings may accumulate. As your principal increases in size, your rate of return will apply to a larger sum, enabling your money to grow faster. The longer…

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What is Hedging?

From Scottrade:  Unlike compounding, which can help maximize long-term return, hedging helps limit risk. Even if you believe you know how an investment is going to perform, market movements are generally unpredictable. As a result, some investors hedge to help counter the instability of the markets.   The traditional approach…

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What is ETF?

From Investopedia  A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold Because it trades like a stock, an ETF does not…

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