Investing

Robinhood Statistics

Online Stockbrokers Going Public

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2020 was a big year for the online stock broker industry and 2021 may be an even bigger year. The initial public offerings of eToro and Robinhood will leave both companies flush with plenty of capital to capitalize on that growth. The COVID-19 pandemic resulted in a surge in demand for online stock brokers. Stock markets worldwide were in freefall during the early stages of the pandemic, and many new investors recognized an opportunity to buy shares of beaten-up companies via online brokerage companies. This was truly a global trend. While Robinhood dominated new account creations in the US and media headlines worldwide, other stockbrokers were competitive outside the USA.

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Asset Allocation

Aspiring Investors: Getting Started in the Stock Market

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The fear of a missed opportunity, if the stock market does indeed continue to rise throughout 2021,  is often a powerful motivator to the new investor. Although starting out is relatively easy, navigating the various pitfalls of investment can be an extremely intricate challenge without the right knowledge to back you up. In his classic book “Influence” Robert Cialdini lists “fear of loss” as an extremely powerful motivator, so we must be cautious in the face of the temptation to jump in with “both feet” without knowing what we are getting ourselves into.  Here are some tips for anyone wishing to act upon their interest in the stock market. 

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McClellan Summation Index

Why These Stock Market Indicators Should Grab Your Full Attention

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What is the McClellan Index and why should you care? According to Investopedia, “The McClellan Summation Index is a long-term version of the McClellan Oscillator, which is a market breadth indicator based on stock advances and declines. The McClellan Summation Index is used in technical analysis and can be used to identify bullish or bearish bias, as well as the strength of the trend. It is a different way of quantifying the movements in the market other than looking at the price levels of the different indices.”

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Dow Last 10 Years

The Markets in Perspective: What Goes up Must Come down?

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Traders routinely fixate on short-term price movements in their chosen financial instruments. Longer-term investors need a wider focus on stocks, forex, indices, FED actions and commodities to gain a better market perspective. The performance of US markets is worthy of mention, particularly since the epic global meltdown following the financial crisis of 2009/10.

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Stocks Up Rates Up

Do the FED’s Interest Rates Affect the Stock Market?

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In anticipation of the September 25-26 Fed meeting, CNBC ran this headline (Sept. 21): “Record High Stocks Face Fed Rate Hike.” implying that the Fed’s interest rate decisions actually affect the stock market. Common wisdom says that “falling interest rates means higher stock prices, while rising interest rates means lower stock prices.” At first blush this might sound logical because rising interest rates makes fixed income investments more attractive because they pay more and have less risk than stocks. So some of the available capital will flow into bonds, etc. thus starving the stock market and putting downward pressure on prices.  In this article, Elliott Wave International contends that there is actually no consistent relationship between interest rates and the stock market and they present examples of how the exact opposite of what you would expect has happened.

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