Your Questions About Investing Tips

Nancy asks…

i m a new comer in share market tips me for investing in a share!!!!!?

John answers:

One piece of advice, do NOT buy any northern rock shares.

Betty asks…

i have 50 dollars.nee advice/tips on investing?

i have 50 dollars lef from my pay check. i was wondering if there was any way i could invest it and get double my money back. what should i invest in?

John answers:

Buy a couple of old silver dollars. Good Luck!

Ruth asks…

Jim Cramer always says not to invest on tips, but doesn’t he give tips every night on his lightning round?

And re: Ron Berue’s answer–what is the difference between a person’s opinion on a stock and a tip–aren’t all tips expressions of opinion on a given stock?

John answers:

Yes that is correct and on piece of advice he gives that you should follow is don’t invest in tips.. Which includes his. He is a better entertainer, than he is a stock picker.

Michael asks…


John answers:


For free tips you got a large number of options

this is our own site for analysis and swing trading tips
2. Http://

For tips from brokers and general public

3. Http://
Auto stock analysis using prebuilt software

technical analysis and screeners

if you want to download stock books and want to study yourslf rather than depending on others

i think 5 is enough

But if you want to see directory of indian Stock market blogs and sites
check at

i think this list is sufficient .
If you need more tell me

Sandra asks…

New to investing money need some advice?


I was wondering if some one can give me some tips on were to invest some money, I have a cd which is 1% interest, which really sucks. TSP which I put 8% of my pay towards. I have 5 thousand dollars to invest and was wondering where i should put the money. Are there are places that will help you invest or that have stock brokers? Im brand new to investing .

Thank you.

John answers:

Financial advisors are either working for a commission in which case they will steer you towards funds with a load either front or back and or funds with a high maintenance fee or they are working for a fee that you pay. Even if you do pay them to be more objective, there’s only their good character that keeps them from pushing a fund that they would make a good commission on.

Investing is about risks and when there is the possibility of loss, you should never be 100% invested hence your portfolio should always be proportioned between at risk and risk free.

Investments like government bonds and CD’s can be considered to be risk free. Corporate bonds are not risk free as companies do fail. The average lifespan of a company in the Fortune 500 is 40 years so there’s a 2.5% per year chance of failure, this ranges from a 2 in 10,000 chance per year for a AAA rated company to a 4% per year chance for a CCC rated company according to Moody’s. Moody also says that the average default risk is 2% per year. If we use the 2% per year risk then a 3 year corporate bond that paid an annual coupon would have a 2% chance of paying nothing at all, a 1.96% chance of only paying the first coupon and nothing else, a 1.9208% chance of paying the first two coupons and nothing else and a 94.1192% chance of paying all three coupons plus the face value of the bond.

When the risks are independent, they can be diversified away, so the optimal is always to invest in more than one opportunity but well short of all available opportunities. Without going through the possibly complicated calculations, it can be said that the worst investment would be to invest in just one stock and the second worse would be to invest in all the stocks. However it’s difficult for a small investor to invest in more than one stock so the best option for a small investor would be investing in an index fund thereby investing in all available stocks.

There are many different funds, each with their own strategy as to how to beat the market and they all charge a fee. Only half the funds beat the index and indexed funds have the lowest fees as the fund manager doesn’t have to do anything except look at the index once a year and rebalance. Therefore the best option is a no load, low fee index fund.

The other issue is how much to invest. If you had the opportunity to wager on a coin toss that paid a 2 to 1 payout in that you received twice your wager plus the return of your wager when you won and lost your wager when you lost, how much of your money would you wager on each coin toss? If you wager nothing, you gain nothing but neither do you lose anything. The more you wager, the more you stand to gain but if you wager everything with each coin toss, you’ll lose everything with the first loss. What you hold back from being risked is as important as what you risk because of the opportunity value of what’s being kept risk free. In the coin toss example, the optimum for the growth of wealth is 25% of your portfolio with each coin toss. Those aggressive funds with 100% invested in stocks are a disaster just waiting to happen, they are completely unable to take advantage of the bargains from a market downturn so they just flap in the wind. You do not want 100% in anything unless it’s a sure thing and there are no sure things. Claude Shannon at MIT, the father of the information age, calculated that the optimal was to have 50% at risk and 50% risk free. Warren Buffet’s mentor Ben Graham recommends 45% in stocks with the rest in bonds and warns against investing less than 25% in stocks or more than 80% in stocks. The aggressive 100% stocks are nothing more than an eventual devastating loss if held long enough.

The common advice given is to be aggressive when young. This does not hold up to scrutiny. When you are young, your investments will be or should be held for a long time hence they are far more likely to encounter a downturn. To shift progressively from aggressive investments to conservative investments as you age requires liquidating the more aggressive holdings in favour of the conservative holdings periodically and this involves a lot of overhead. If anything, you would be better off starting by investing in conservative funds and periodically switching your contributions to more aggressive funds while still holding your previous investments. Again, anything that diverges from an index fund is costly in fees so it’s not worth it to try and proportion the risk through a spectrum of funds.

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