How safe are money market accounts?

July 8, 2024 No Comments

A: Money market accounts are perfectly safe. Banks offer these accounts to consumers interested in earning slightly higher interest on their deposits than they would receive with standard checking and savings accounts. Consumers sometimes confuse money market accounts with money market funds. Both are relatively

If caught, what implications does money laundering have on a business?

July 8, 2024 No Comments

A: Money laundering is a multibillion dollar industry that impacts legitimate business interests by making it much more difficult for honest businesses to compete in the market since money launderers often provide products or services at less than market value. Where a financial institution or

If I buy a $1,000 bond with a coupon of 10% and a maturity in 10 years, will I receive $100 each year regardless of what the yield is?

July 8, 2024 No Comments

A: Simply put: yes, you will. The beauty of a fixed-income security is that the investor can expect to receive a certain amount of cash, provided the bond or debt instrument is held until maturity (and its issuer does not default). Most bonds pay interest

How does a bull market in stocks affect the bond market?

July 8, 2024 No Comments

A: Bonds and stocks compete for investment money at a fundamental level, which suggests that a strengthening equity market would attract funds away from bonds. This would tend to lower the demand for bonds; sellers would have to lower prices to attract buyers. Theoretically, the

How Does a Person Gain From an Investment?

July 8, 2024 No Comments

A: There are two main ways in which a person gains from an investment. The first is by capital gains, which is the difference between the purchase price and the sale price of an investment. The second is investment income, defined as the money paid

How does inflation affect fixed-income investments?

July 8, 2024 No Comments

A: Inflation is typically defined as a sustained increase in the price level of goods and services. There is no widespread consensus on the primary cause of inflation, but most economists agree that certain mechanisms in the economy, mainly commodity price increases and currency depreciation,

How are treasury bills (T-bills) taxed?

July 8, 2024 No Comments

A: Interest earned on all U.S. Treasury securities, including treasury bills, is exempt from taxation at the state and local level but is fully taxable at the federal level. At the end of each year, owners of treasury bills should be sent a 1099-INT form

How can bond yield influence the stock market?

July 8, 2024 No Comments

A: Bond yields influence the stock market in different ways at different times. Investors and traders need to be aware of economic and market conditions to understand the constantly evolving relationship between bond yields and the stock market. Changes in the Economy When the economy

How can I calculate the carrying value of a bond?

July 8, 2024 No Comments

A: The carrying value of a bond is the net amount between the bond’s face value and any un-amortized premiums or minus any amortized discounts. The carrying value is also commonly referred to as the carrying amount or the book value of the bond. Because

How Can I Check If an Old Railroad Bond Has Value?

July 8, 2024 No Comments

A: Finding out whether an old railroad bond from 1938 still has any value is a tough question to answer. The short answer is that it will require a person to do some homework or spend money on a search service. Getting Started With Your Research The first step

All Rights Reserved