Potential Red-Flags While Value Investing

We have discussed the basics behind value investing in past articles, as well as some of the World’s most famous value investors — Warren Buffet being a popular example. As a refresher, remember that value investing is all about bargain-buying stocks and getting in on an opportunity while the market price is listed below its intrinsic value. While this basic concept is simple, though, value investing can be complex because the term “intrinsic value” is so loosely defined.

Using Volatility to Inform Your Stock-Picking Decisions

We talk about volatility in a general sense all of the time. It is not unusual to say, “oh this stock is moving a lot today - it is looking pretty volatile.” Other times, we tie the concept of volatility to our perception of the “riskiness” of a certain security or use it to gauge the uncertainty that we may have about the future changes in the stock’s value. But, truthfully, when it comes down it, many investors do not really understand what volatility is or how it can be used to help them improve their stock-picking decisions.

What Are Defensive Stocks?

There are many challenges that investors face to continually turn a profit. Moreover, investors generally do not only aim to profit but to profit enough that they beat the market. However, what happens when the overall stock market is underperforming? Is there anything that can be done? Are there “safe stocks…?” While no stock is foolproof — and every investment made is also a risk being taken — there are some stocks that are safer than others during market downturns. In fact, these stocks are often referred to as “defensive stocks.”

Turning Your Discretionary Money into Something Big

Often young investors find it difficult to allocate money towards their investment portfolios because they have a tough time determining the differences between their wants and their needs. In reality, though, the difference between wants and needs is quite simple and the sooner you understand what a true need really is, the easier it will be for you to start investing your discretionary money.

Is It Possible to Beat the Market?

In investing terms, “beating the market” means trying to earn an investment return greater than that of the S&P 500. The S&P 500, an index comprised of 500 of America’s most widely-known large-cap companies, has become a popular indicator of the performance of the US stock market as a whole – because these companies control a large part of their respective industries. And, picking stocks that outperform this index over time has seemingly become the ultimate “trophy” that takes a spot very few investors’ shelves. Here are just a few reasons why it can be very difficult to “beat the market” – and why you don’t have to beat the market to find investing success

High Priced Stocks vs. Low Priced Stocks – What’s The Difference?

Whether or not you are currently an investor you have almost certainly heard the phrase, “buy low, sell high.” Just in case you have not though, this phrase is commonly used to describe the basic investing strategy, that is, buying a stock while it is perceived to be trading at a low price (meaning you believe it is undervalued), and then selling the stock when it is perceived to be trading at a high price (meaning you think the valuation is correct or the stock is overvalued). That said, there is an important distinction between a stock that trades at a high price (or low price) and a stock that is overvalued (or undervalued).

When is the Time to Invest and When Is the Time to Save?

William Shakespeare once wrote, “to invest, or not to invest: that is the question.” …or something that sounded a lot like that. Just take our word for it. Anyway, this question helps to sum up one of the biggest fears that young investors have today: timing. Especially when you’re just starting out, it can seem like a pretty big deal to even be able to cover your own rent and living expenses – so, how are you supposed to know when it is a good time for you to invest your money? Or, what if right now is a good time for you, but not a good time for the market?

Tips for International Investors

DriveWealth has a significant number of users who live outside of the US but invest in American markets. If this is you, welcome! Here are some tips to consider as an international investor. When considering making an international investment, it is important to consider that you are not only investing in the company but also in the currency of the country each company trades in.

Things to Understand About Money...While You Are Still Young

There seems to be a stigma regarding younger people when it comes to money. Most people think that millennials are notorious for either poorly managing their money or just ignoring it all together. However, here at DriveWealth we know that is not the truth. In fact, the fact that you are reading this article proves the former assumption wrong. Further, by continuing to explore the ways money works — and understanding how you can make it work for you — you will undoubtedly be proving those assumptions wrong as well; likely you already are! So, in the spirit of gaining knowledge about how money works, here are a few things about money that you should consider while you are still young.

Does the Perfect Investment Portfolio Exist?

In all of your extensive research about how to formulate an investment portfolio that is right for you, you may have come across articles talking about “the perfect portfolio” or “the investor who has done the impossible” by finding the exact perfect mix of investments and, thus, created “the perfect” returns. If you have not seen these articles yet, try a thirty second Google search. Or, just trust us. They are everywhere. With all of these headlines flying around about other investors’ great successes, you might be wondering: how do I create the “perfect” portfolio? Indeed, this is a question that many new investors ask – and oftentimes we look to more experienced investors for their advice.

What Are the Absolute Biggest Mistakes Young Investors Make?

For most of us, learning something new probably means making some mistakes along the way. We learn from experience – and the more we try, the better we get. For this reason, many people agree that it is best to work hard and obtain our valuable learning experiences as early as possible. Then, with the simple mistakes under our belts, we can move forward and make more calculated decisions in the future.

In this sense, investing is just like anything else – it’s very likely that you’ll make mistakes when you first start out. But, don’t let that thought scare you, because it’s also probable that you will get better at making investing decisions as you obtain more experience.

Tips for Aspiring Hedge Fund Managers

Some consider managing a hedge fund to be the modern version of the “American Dream," well… at least for individuals who are excited about investing, that is. Perhaps the popularity comes from the mainstream media coverage, from which many of us have read or heard stories about hedge fund managers earning hundreds of millions, if not billions, of dollars. Or, maybe it is the slightly secretive and exclusive allure that surrounds hedge funds that catches our interest more than other financial vehicles might — which can sometimes seem more straightforward and even repetitive to some people. Interestingly though, it is relatively simple to start a hedge fund as long as the founders can raise some capital.

What is Impact Investing?

At its core, impact investing can be defined as investing that aims to generate specific beneficial social or environmental effects in addition to financial gain for the investor — just like with traditional investments. Technically, impact investing is considered a subset of ‘socially responsible investing,’ however, while socially responsible investing focuses on a general avoidance of harm, impact investing is a more narrowly focused type of investing that actively seeks to make a positive impact. For instance, some impact investors make investments in non-profits that benefit a specific community. Essentially, the goal is to aid in the reduction of negative effects that business activity has on the social environment.

Getting Ready to Invest? 7 Steps You Can Take to Prepare

You have made up your mind – it’s time to start investing. Maybe you’ve asked around and heard all of the positive experiences that your friends and family have had with investing their money. You might have some big future goals and think that investing could be a good way to grow your personal wealth. But, after you make the initial decision to invest, where do you even start? This is a question that all investors are faced with, and it is something that requires a little bit of road-mapping to answer. To help you make your map, we have assembled a list of some of the most important steps that investors take in order to turn their investing dreams into a reality.

Time to Re-Think the Way You Save Coins and Here’s Why

The joy of unloading a full spare change jug at the bank or into a CoinStar machine is perhaps one of the most underrated feelings in the world. Generally, it is a mystery as to how much the sum of your change is worth and, it seems that sum of change is often worth more than you initially expected. However, while it is great if you are saving your change, you are likely not using your change to its full potential.

4 Smart Steps for Young Investors Looking to Ease into Investing

While it might not be your absolute favorite topic to chat about with your friends, the subject of investing may come up in conversation from time to time. For some of us, these conversations are exciting and become a chance for us to talk about our new investment ideas, successes, or failures. For others, though, the idea of investing is completely foreign, and can even be scary to talk about.