Your Questions About Stocks And Bonds Basics

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Paul asks…

Can someone explain the stock and bond markets?

I have a basic understanding of the stock market and mutual funds.I am just interested in learning more.Please just lay out the market basics in a couple simple paragraphs.
What is a stock?What are the classes?
What is a bond?What are the classes?
What is a treasury bill?
What is a money market fund?
What is a mutual fund?
What is an index fund?
How does commodity trading work?
How does currency trading work?
What have I missed?

Please have fun with this but only answer if you can truly help.
I know the answers to some of the questions I have asked, so that I can verify those answers and to help me look for validity in the answers to the questions I do not know.

Please do not troll, I am looking for insight in how other people than myself look at these items.

financi4 answers:

1. You have too many questions. Why can’t you ask one question at a time?

2. If you know the answer to the question, then why are you asking the question? I don’t like to answer questions when the asker already knows the answer, because I feel like I am wasting my time.

3. Why don’t you read a book first, and then ask some questions? Here are good books:
– Stock Investing for Dummies
– If You’re Clueless About the Stock Market…
– The Neatest Little Guide to Stock Market Investing

You can probably find these in your local library too.

Mark asks…

Investment Banking Career Question?

I have a question. I currently have a Bachelor’s Degree in Business Administration, and am doing my Master’s in Business Administration at the moment, expecting to graduate december 2009. Most of my work experience has been coordinating, assistant managing, and supervising (5-6 years), nothing more. I applied to work an invenstment bank because I like giving people advise and suggestions and I know if I learn the material in detail, i can be the best.

Question: If I were hired with this investment bank for positions of financial analyst, or investment banker (I am fluently tri-lingual) am I already expected to know 100% about finance? Or am i expected to know the basics, and will eventually be taught by the bank? Please help, I need to know to see what I need to learn and “catch up” on if need be. I do admit that there are many people who know about stocks, bonds and securities, much more than I do. Is this something needed prior to starting? The reason I ask is that for my BBA and MBA we did touch on finance and investments, but not that deep to the point where I feel I can financially advise someone today… Thanks guys. Ps. I will obviously get my bloomberg certification, series 7, and 66.

If you have any other information for me, even after this question closes, I would really appreciate it. My email is

financi4 answers:

The financial institution will train you to adopt their regulations: your education will get into the institution:

John asks…

Which programming language best suits this task? (Database)?

I need to create a script for data organization and visualization purposes associated with the financial markets (stocks, bonds, forex, etc). In the future I hope to do some P2P social media user-interface design and iPhone app ideas. I have very little or no programming experiences (html basics, programming TI-86 calculators, and simple flash 5 scripts), but taught myself finance with little trouble, so I am not afraid of complexity and learning curve. I just don’t know where to start.

Below I have listed the specifics of the script desired (what functions I need it to have, etc). I need to know at the least which programming language to use and maybe a good site to find tutorials for creating the kinds of scripts that are relevant to my purposes. At the most, I would greatly appreciate some samples of code that can help me accomplish or learn how to do the following task .

I want to count and then visualize the number of times that the price moves over two exponential moving averages of 144 and 169 periods. I would like to have the option of being able to insert a filter: to only count the occurrences that stay above or below the exponential moving averages for X number of periods. I would also like to be able to easily visualize the data to show the occurrences that the price stayed over the exponential moving averages for X number of periods, Y number of periods, Z number of periods…(infinity)

This program will not need to constantly recalculate. I’m basically just running an empircal test to determine the consistency of synchornious events inside of historical price information: If A price value is greater than moving average values (B) and (C) , will the price continue to rise, and if so, for how long?

I could imagine myself just downloading this information into excell and creating a VB script. What are the advantages of using PHP/mySQL in these types of environments? It seems that PHP/mySQL is web-based, which would help I’m guessing would help if the data set is very large and/or if the process must be on-going for a long period of time (e.x.: SETI) am I right?
I trade with MT4.

financi4 answers:

You need to think about:
– Where the calculations and visualizations will happen (server or client side)
– What data you have to store (server side)
– Security and financial concerns

The actual code for this will be a mathematical algorithm. It will basically look and work the same no matter which language you use. Even for creating the visual graph the code will be pretty much the same as the basic Graphics libraries are all similar (.Net GDI+, PHP GD, etc.). The difficult part will be writing the correct algorithm (Math!) to handle this accurately, after that the code will be very portable.

If you need to continually save the data in a database, you will need a server running a database. Web applications like this are usually done in either .Net and MS SQL Server or PHP and MySQL. Other than price (PHP/MySQL hosting is cheaper) there should be no practical advantage to either, just what you’re most comfortable coding in. Both have tonnes of resources online for learning how to code. (Try and Google)

A bigger issue is security. If this data is being saved to a Database you want to make sure it is not vulnerable to SQL-injection or other types of attacks. A compromised database will make this whole thing fall a part.

MySQL is a database, it is for saving data on a server. PHP is a server-side scripting language, it is for handling data on a server and displaying it to the client.

If what you want to do does not need to save data, then this can be handled without your own database. (I had pictured a graph over time, which would need to save previous data.) This would require on-demand third-party Services where the data will come from when the client clicks “Show me Andrew’s Financial Thing”.

You would still likely want to handle this server-side (PHP), as you will have more security and control over what is displayed. (As opposed to client-side scripting such as Javascript.) The PHP page can display your visualization on regular page, as part of a Facebook app, or for a mobile browser page.

Doing this for an iPhone App will require either a reimplementation in Objective-C of the algorithm and graphics code (it connects to third party services), making an iPhone app that connects to the PHP page and displays that data directly (as if it where a web browser), or a combination of the two (it checks with the php page to get the information but creates its own visualizations.)

For example, (sorry to plug) we recently made an iPhone app that graphs financial information inputted by the client.

Robert asks…

Is there a “for dummies” type of book to teach me about basic finance?

I feel like everyone around me knows about financial stuff, and it’s as if I missed some kind of seminar along the way. I’m talking about stocks, bonds, 401k, mutual funds, trust funds, IRAs, etc. I know very little about them, but I’m in my 20s with a new baby and it’s time for me to start seriously thinking about my family’s financial future.

Is there a book that could give me the run-down of the basics of these things? Something that doesn’t assume that I know any kind of jargon or preexisting knowledge.

financi4 answers:

There are several books. The starting point is “Investing for Dummies”, Second Edition [Paperback] by Eric Tyson. This will give you the background to understand more specialized books such as Stock Investing For Dummies [Paperback] by Paul Mladjenovic. Follow this up with “Bond Investing For Dummies” [Paperback] by Russell Wild and “The Bond Book: Everything Investors Need to Know About Treasuries, Municipals, GNMAs, Corporates, Zeros, Bond Funds, Money Market Funds, and More” [Hardcover] by Annette Thau.

Please remember that no one book or a group of books will make you an expert. However these books will give you the background to ask intelligent questions and understand the answers.

If you speak to investment brokers, remember that they are paid on commission. They will sell you whatever gives them the greatest commission. Their first loyalty is to themselves. Their second loyalty is to their employer-the brokerage firm. You are a distant third.

David asks…

What are some good investment books for beginners to purchase?

What are some good investment books where I can learn the basics of stocks, mutual funds, CDs, IRA’s, ETF’s, ESA’s, and Bonds.

financi4 answers:

The important thing you need to learn first is getting a feel of the stock price patterns. The way the prices change can be predictable over the long term and work under similar market principles as the blue chips and regular stocks. This skill takes some time to develop and it cannot be acquired from reading a book on penny stocks for dummies. You will want to look out for the small and young companies that have been frequently reported in the news as this usually means a great change in their prices will occur as more people started to trade in their shares. These are typically worth a look as the top penny stocks to buy for newbies.

Donald asks…

financial advice ……?

okay i am in my first year of college getting basics out of the way, I am in the work study program but i make minimum wage work 12 hours a week and get paid oncs a month…..
so im getting ready to start hiding money away…. where is the best place to put it…. Savings account, cds, bonds, stocks. ….. What’s the best route to go….. and how do i do it?

financi4 answers:

Right now there are only 2 investments. Precious metals and stocks of precious metals mining companies. I would start with buying some silver coins.
Forget bank accounts or cash.
Try to inform yourself here:
or at
King world news.

Or try:

I assure you I have nothing else.

Thomas asks…

Wanting to expand my financial knowledge.

I need some suggestions. I am currently earning an associates degree in management/marketing…. However, I am really interested in finance and i want to earn a bachelors degree in finance… I pretty much know all about stocks, mutual funds, bonds, pretty much all the basics plus some… But since I have an interest in this what more should i learn? For example is there any sites explaining what is needed to know about corporate finance? Or what is other criteria I should know? thanks!

financi4 answers:

I teach a survey class on Corporate Finance, so I try to read promising books on the topic. Here are a couple of books I would recommend:

Berman, Karen, and Knight, Joe. Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean. Boston: Harvard Business School Press, 2006. Very readable overview of financial reports that emphasizes the decisions behind how the numbers are tracked and reported.

Bogle, John C., The Battle for the Soul of Capitalism. Yale University Press; New Ed edition, 2006. The author, founder and former CEO of Vanguard Financial Group, has been called “the conscience of the (financial) industry.” In this book he examines causes of the bubble of the late 1990’s and considers how much threat still lurks in today’s business and investment practices. Since you are just getting started in business, you will be facing the issues Bogle outlines; hopefully, you will also contribute to their resolution,

William asks…

Should I change my allowances?

My husband and i both work and currently claim 0 allowances on our w2’s. Each year we get back less on our end of year taxes than what we expect. Here are some basics: We have one child, we claim interest on our mortgage, we have stocks and bonds where we claim dividends and interest. We pay state taxes to 2 states (live in one and work in another). We claim 1 on those w2’s.
Between the 2 of us, we make a little under 100K a year. One makes 80 and one makes 28. Should we leave the federal taxes at 0 or change it to 1?
Let me add that we don’t live paycheck to paycheck, so we actually enjoy getting a nice return. We look at it is a bonus for ourselves at the end of the year either paying off a loan that we may have or if none, going on a vacation etc that we normally wouldn’t have done. From the second answer, it sounds like I should keep as 0.

financi4 answers:

the issue is whether you prefer to have the money as you earn it, or in a lump sum at year end
getting a small refund is considered good management, meaning you have use of your money and the government has very little of your money
BUT some people prefer to receive a lump sum–especially if they aren’t good a saving and self discipline for savings plan
Decide what works best for you
The MORE allowances you claim, the LESS withholding you have

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