Investing is a game of informed risk taking.

You have to pay close attention to the markets, price in changes in sentiment or economic conditions, and take in as much information and as many perspectives as you possibly can.

It’s impossible to predict the future, of course, but the investor’s job is to use everything at their disposal to narrow down the possibilities to a profitable few.

An investor needs impeccable instincts.

They need a wide, deep knowledge base encompassing a thousand different subjects.

Most of all, though, they need a constant stream of high-quality information to help them make the decisions that will bring them and their clients the largest returns possible.

There are dozens of services out there that purport to provide the best, most potentially profitable investing advice.

Some are free, while others charge an arm and a leg for the pleasure.

Every one of them has their own roster of elite investors and thought leaders that share their thoughts on everything from Treasuries to cryptocurrencies, and every last one of them claims to be the best.

As many investment advice and research firms there are, only a few have the kind of cachet to give them a legitimate claim to the crown.

One such firm was founded in May of 1984.

It Called Itself Morningstar

Joe Mansueto founded Morningstar alone in his apartment 38 years ago.

Today, it’s a billion-dollar enterprise with over 6,000 employees and provides in-depth research for over 620,000 different investments.

Morningstar is known as one of the top providers of investment research in the industry, and they show no signs of slowing.

This Morningstar Investor review will tell you about Morningstar’s flagship service, what it offers, and how much it costs.

What Morningstar Offers for Free

Morningstar’s website has a lot to offer for free users.

There are trackers for about any market and security you can think of, high-level financial news and market updates, general investing advice, insights from some of their analysts and advisors, and a selection of stories and insights for mutual funds, stocks, ETFs, bonds, and other categories of securities.

There’s a lot on offer on Morningstar.com, maybe even more than you’d expect from a free service.

It’s all pretty surface-level stuff, though; Morningstar’s real insights and advice are tucked behind a paywall.  

Morningstar Premium

Morningstar has a whole range of memberships broken into three categories: Professional Products, Managed Investment Products, and Individual Investor Products.

Their flagship product, Morningstar Investor, is aimed at providing the research and tools that individual investors need to make informed decisions and maximize their returns.

The plan offers a free seven-day trial for new users, an ongoing subscription for $34.95 per month, and an annual plan for $249 per year.

Budget-conscious investors willing to pony up $249 up front will save about 41% over a monthly plan, so it’s highly recommended if you have the money.

It also might not be a bad idea to take the free trial and maybe one or two months before committing to an annual membership, just to be sure it’s the right product for you.

What Morningstar Investor Has to Offer

Morningstar Investor offers a lot of value to active traders and value investors.

An Investor membership will get you full access to research and analysis from over 150 independent analysts, all of whom are industry veterans with proven track records on Wall Street.

The analysis encompasses a range of investment types and is geared toward being as actionable and up to date as possible.

Investor memberships also give you access to a frankly insane list of Morningstar ratings on all different kinds of securities, individual managers, socially and environmentally conscious investments, and pretty much anything else that you can think of.

Morningstar also makes their methodology available to subscribers, so you can go ahead and run the numbers yourself if you aren’t convinced of any given rating.

In addition to all the research and ratings, Morningstar Investor also comes with a full suite of portfolio management and analysis tools.

You can evaluate potential investments based on a comprehensive list of performance and valuation metrics, access pre-filtered investment lists that meet your preferred criteria, and tailor your portfolio to your exact specifications with just a few clicks.

Finally, Morningstar Investor enables you to evaluate your portfolio from any angle using their Portfolio X-Ray tool, which provides a set of user-friendly tools that make it easy to check a number of metrics like asset allocation and sector weightings.

You’ll even be given special analysis, commentary, and news that’s tailored to your specific portfolio.

Is Morningstar Investor Worth the Price?

The short answer seems to be: Yes. It is worth the price according to a whole slew of financial websites.

–          Wallet Hacks: Worth it

–          Well Kept Wallet: 4.3/5

–          Credit Donkey: 3.8/5

–          NerdWallet: Worth it

–          Investor Junkie: 8/10

–          Money Under 30: 9/10

–          Day Trade Review: 4/5

You get the picture. The consensus is that Morningstar Investor provides a ton of valuable research and analysis—more than enough to justify the price—and that it mostly loses points for its somewhat cumbersome tools and less than stellar mobile app.

Who Would Benefit the Most from Morningstar Investor?

Morningstar is aimed primarily at more active value investors.

You won’t find many technical analysis charts on Morningstar.com, so technical analysis wonks probably won’t want to spend the money.

Fundamental investors, on the other hand, will find a wealth of easily accessible and in-depth analysis on the fundamentals underpinning an absolutely crazy number of stocks, mutual funds, ETFs, and other securities.

Conclusion

Morningstar Investor is kind of pricey.

Even the reduced $249 price for an annual membership will be hard to justify for most casual investors, and even more experienced traders may want to find another service that caters to their particular brand of investing.

You won’t find much analysis on cryptocurrencies, technical analysis tools, or prescriptive advice if you go with Morningstar Investor.

If you want someone to tell you exactly how to invest you probably won’t find much to love about Morningstar Investor. In that case, you might want to look at a service like the Motley Fool instead.

But if you like the idea of getting all the fundamental information and in-depth analysis that you need to make informed decisions, however, Morningstar Investor may be just the ticket. 

After reading this Morningstar Investor review, what are your thoughts on the product? Let us know in the comment section!

The post Morningstar Investor Review appeared first on Wall Street Survivor.

Overstock.com is not a stock website, though it is a website with a stock (NASDAQ: OSTK).

The site has made a name for itself as something like an online outlet mall that initially specialized in home décor but has expanded to sell everything from jewelry to electronics and sporting goods.

The brand is known for its deep discounts and low price points compared to other retailers, and it seems to have a pretty decent reputation.

But the question is: How good is Overstock.com really?

This Overstock.com review seeks to tell you just that.

The History of Overstock

Originally a company named Discounts Direct, Overstock got its semi-misleading name when it was purchased by a man named Dr. Patrick M. Byrne back in 1999.

Overstock did brisk business under—and perhaps in spite of—Byrne’s tenure, including going public in 2002 and reporting its first billion-dollar year in 2010.

By the time Byrne announced his resignation and claimed the FBI made him engage in an intimate relationship with a notorious Russian spy, Overstock had established itself as one of the premier online sources for closeout and discount home furnishings.

The company is currently headed by CEO Jonathan E. Johnson as Byrne, its former head, pursues a new career in peddling misinformation and ridiculous conspiracy theories.

Overstock’s Product Offering

Overstock.com started with furniture and home décor, but its catalog has ballooned in the 23 years since it was founded.

In addition to their array of interior and exterior furniture and décor, Overstock now sells bedding (including mattresses), appliances as small as blenders and as large as gas ranges, grills, trampolines, swing sets, tents, exercise equipment, and products from dozens of other categories.

Some of Overstock’s inventory is manufactured specifically for the site, but most of it comes from the roughly 3,000 third-party vendors that partner with Overstock to sell goods on their site.

Most of Overstock’s revenue comes from the sale of third-party goods on their site.

Overstock’s Product Quality

Most of Overstock’s inventory comes from reputable manufacturers and suppliers.

There are plenty of name-brand goods available on the site, and there are very few reviews or reports available claiming that any of the products were fake or lower quality than what you’d find at another retailer.

The low price points and steep discounts on Overstock.com may give some buyers pause.

Normally when you see a product available for significantly less than on another site you’d assume that there was some kind of scam involved.

Overstock is acutely aware of the importance of maintaining a good reputation in such a competitive space, however, so they enforce strict quality control to make sure no consumer receives counterfeit or defective products.

Overstock’s Prices

Overstock’s business model relies on the competitive edge it gets from its low price points and discounts.

They’re so proud of their low prices that they even put real-time price checkers on their product pages to show how much you’d save if you bought from them instead of their competitors.

A number of factors contribute to Overstock’s ability to offer products at such low prices:

1. They purchase and sell liquidated inventory from other retailers
2. Advanced logistics capabilities tailored for furniture and home furnishings
3. The Club O Loyalty Program that increases customer retention
4. Long-term mutually beneficial relationships with vendors and manufacturers

The firm lists these factors as part of how it stays competitive as part of its latest 10-K report to the SEC.

They aren’t exactly forthcoming on any of the specifics, but it makes sense that they’d keep them under wraps.

Overstock Customer Experience

Overstock.com and its mobile app are very easy to navigate.

Finding the products you’re looking for is quick and easy, and they have the same smooth purchasing process as prominent rivals like Amazon.com.

Reviews for Overstock.com are pretty much what you’d expect: A ton of good reviews that are drowned out by the hordes of pissed off customers who had a bad experience.

The good reviews are very complimentary about how easy it was to buy and have products shipped to them, how the products arrived on time and in good condition, and occasionally that Overstock was quick to replace an item that was broken or damaged in transit.

Some of the negative reviews are your typical sour grapes, but there’s a fairly disturbing trend that arises when you read through enough of them.

A lot of buyers report struggling with Overstock customer service personnel for returns, account credits, and (apparent) pricing and financing mistakes.

One reviewer reports receiving a rug from Overstock that was infested with moths which went on to destroy almost all of their clothes.

Another reports a big purchase being canceled without warning or notification.

Someone calling themselves Deepwoods said they paid for two chairs, received one, and was never made whole. 

So it seems like you’ll have a great experience if you buy from Overstock.com…

…as long as nothing goes wrong.

If something does go wrong, well, it seems like you’re in for a fight.

Taking Stock of Overstock’s Stock

Overstock’s stock OSTK is currently trading at $29.14, with its 52-week range being between $24.69 and $111.28.

The company posted overall sales earnings of $2.76 billion in 2021, a 10.53% increase from the previous year.

Its earnings have been on a slow but fairly steady upward trend over the last five years—other than 2019’s painful 19.88% decrease from 2018.

The firm’s 2021 gross income of $606.04 million represented a 10% increase from 2020, and its net income of $155.38 million was an increase of 75.18% over the previous year.

Overstock employed 1,350 full-time employees as of December 21, 2021, and reported difficulties in finding the kind of talent it felt it needs moving forward, particularly when it comes to finding software engineers and technical staff.

The firm reported hiring 177 new non-customer service or warehouse staff in 2021 in addition to 55 new customer service and warehouse personnel.

The environment in which Overstock operates is very competitive and will likely remain so for the foreseeable future. E-commerce is a crowded field, and there are relatively low barriers to entry for new firms trying to get into the market.

For example, we wrote a review on another popular e-commerce website, StockX, which deals in shoes, electronics, collectibles, and more.

The site Wayfair is of particular concern for Overstock due to similarities between their product offerings and business models, and will likely remain a source of consternation in the future.

That said, the threats Overstock faces appear to be threatening its growth, not its survival.

The company’s financial situation remains stable enough to assure continued business and modest profits for at least the next few years.

Conclusion

Overstock.com is an e-commerce site that focuses on home furnishings, décor, and a number of other product types, most of which are supplied at a reduced price by its almost 3,000 partners.

The firm leverages these relationships, its logistics network, and other factors to make their price points as cheap as possible for all their products.

Overstock works hard to give every customer a great experience, though it seems like they need to invest more in their customer service if they actually want to achieve that goal.

Have you had any experience with Overstock before reading this Overstock.com review? Let us know in the comments below!

The post Overstock.com Review appeared first on Wall Street Survivor.

With all the volatility in the stock market these days, you may be wondering what other options are out there for you to invest your hard-earned money in.

Real estate is the third-largest asset class in the United States (after stocks and bonds).

Previously, it has been difficult for investors to gain access to real estate without physically owning property.

But platforms such as CrowdStreet are letting investors get into the real estate game without ever touching a shovel!

This CrowdStreet review will introduce you to the platform, tell you what securities CrowdStreet offers, and walk you through their past performance.

What Is CrowdStreet?

CrowdStreet was founded in 2012 by Tore Steen and Darren Powderly.

After the financial crisis that began in 2008, the co-founders thought that people were relying too much on the stock market (and getting burned for doing so).

They wanted to create access to asset classes outside of public equities, which often don’t get enough attention.

However, commercial real estate came with a pretty significant barrier to entry at the time: most people don’t have billions of dollars sitting around to use to fund the construction of a new office building.

But with the emergence of crowdfunding as an investment method, Steen and Powderly saw an opportunity to help investors get into a previously closed-off asset class using partial investments.

There are thousands of investors on CrowdStreet that have invested in at least one project.

These investors have invested over $3.49 billion to fund more than 661 projects.

Now, onto the CrowdStreet review!

What Can I Invest In On CrowdStreet?

There are plenty of different securities you can invest in on CrowdStreet, all of which involve investing in commercial real estate.

You can invest in an individual project, such as the construction of a senior living facility.

You can also invest in a fund that finances multiple commercial real estate projects.

You can also invest in real estate investment trusts (REITs), multifamily buildings, apartments, hotels, and retail spaces.

The projects open for investment on CrowdStreet are passive investments.

This means that you don’t take an active part in the construction / rehabilitation of the properties you’re investing in.

You simply choose which projects you want to help crowdfund, invest your money, and (hopefully) collect your gains!

Like the CrowdStreet website says, “you’re a passive investor, not the landlord.”

CrowdStreet does not currently have a mobile app.

For now, you can only invest on and interact with the platform from your computer.

Why Invest In Commercial Real Estate?

If you’ve read our article on The First Stock Everyone Should Buy, you know that investing in different securities that are uncorrelated (or negatively correlated) can help you mitigate some of your investment risk.

That way, when one security performs poorly, another uncorrelated security may perform well (or not as poorly), and you won’t experience as big of a loss.

Real estate is relatively uncorrelated with the stock market, meaning that it can be used to help mitigate the risks of investing in stocks.

CrowdStreet Fees

The cost of investing on CrowdStreet depends on which projects and funds you invest in.

CrowdStreet does not charge its investors any fees. Instead, it charges sponsors fees to open up their projects to investors on the platform.

The sponsors, however, may charge CrowdStreet investors fees to invest in their projects.

So while it is possible to use CrowdStreet for free, you may end up paying fees for individual projects.

Only accredited investors can invest on CrowdStreet.

Accredited investors are those individuals who have a net income of $200,000 or more ($300,000 or more for married couples), or a net worth of $1 million or more.

Business entities can be accredited investors as well, provided they have enough assets.

Accreditation is required to invest in securities that are not regulated by the Securities and Exchange Commission (SEC).

The SEC requires accreditation for these types of investments in order to protect investors who are not as financially sophisticated from suffering big losses on risky investments.

There are some investment minimums you’ll need to keep in mind when investing on CrowdStreet.

For example, you need to invest at least $25,000 in any given project.

Some projects and funds have a minimum investment of $100,000.

It’s important to know that the money you invest on CrowdStreet will likely not be liquid for several years.

Commercial real estate projects tend to be large undertakings that take years to complete, and the money you invest in these projects will be inaccessible for the duration of the projects.

Please note that this investment style differs from investing in stocks through a brokerage account.

When you invest through a regular, taxable brokerage account, you can (usually) sell off your stocks at any time.

Crowdfunding real estate projects is a longer-term commitment.

As noted above, the average hold period for CrowdStreet projects is 2.9 years.

CrowdStreet Performance

In this section of the CrowdStreet review, we’ll go over how CrowdStreet has performed in the time it’s been in business.

As you can see, the CrowdStreet platform boasts some pretty promising performance metrics.

The internal rate of return (IRR) of 17.5% means that CrowdStreet investors earn a 17.5% annualized return on the projects they invest in.

The equity multiple of 1.5 means that CrowdStreet investors recover about one and a half times the cash that they invest in projects.

This chart shows where CrowdStreet’s calculations for its historical performance came from.

You’ll see that the IRRs do indeed cluster around the 17% range.

You’ll also notice that about 11 of CrowdStreet’s projects have produced a negative IRR, meaning that investors received a negative return on the projects and did not recover all of their invested capital.

In fact, six of these 11 projects produced an IRR of -100% and an equity multiple of 0%, meaning that investors lost all of their invested cash.

While this is only a minority of the deals that CrowdStreet has done, it’s important to remember that returns are never guaranteed when you take on risk with your money.

Final Thoughts

At the end of the day, the best investment for you is the one that best fits your risk profile and makes you comfortable with what you’re doing with your money.

We hope you’ve found this CrowdStreet review helpful and that you know that there are other asset classes available to you besides stocks and bonds, if you’d like to give them a shot.

The post CrowdStreet Review appeared first on Wall Street Survivor.

China’s economy has grown from near irrelevance to the second largest in the world in less than half a century. Perhaps more incredible than its meteoric rise is the fact that it’s done so without any kind of significant economic contraction. Nearly fifty years of consistently positive GDP growth is practically sorcery in the eyes of the west, as our more democratized and less managed economies seldom manage to go a single decade without at least some kind of bust, let alone five.

The assumed impossibility of eternally uninterrupted economic growth has raised more and more eyebrows and elicited more and more dire predictions about China’s economy as time has passed. Surely the ruling Chinese Communist Party can’t stave off the fundamental economic forces indefinitely. Surely the other shoe is going to drop soon, and all will be right with the world.

It has to. Right?

We’re supposed to be living in a post-Soviet world. A world where the question of managed versus free economies is long-settled fact. But if the CCP is able to keep China’s economy—an economy encompassing the interests of over a billion people—from experiencing so much as a recession, that settled fact starts to look more like an open question with each passing quarter.

The current situation facing China’s real estate market is the latest and perhaps most convincing sign that China has finally reached a tipping point. A generation’s worth of breakneck growth, urbanization, and unintended consequences may be coming to a head.

(Un)Real Estate

China’s housing market is currently the biggest asset class in the world, with a notional value of nearly $60 trillion, more than the entire capitalization of the stock market. About one third of China’s economic activity involves the real estate sector (compared to 15 to 18% of the American economy), a staggering figure that becomes even more so when combined with the fact that housing accounts for about 70% of Chinese household wealth.

The reasons for the outsized role that housing and real estate play in China’s economy are complex and numerous, though they all trace their roots back to the CCP.

The current real estate crisis began shortly after China relaxed its rules on private home sales back in 1998. This change in policy roughly coincided with the explosive economic growth that’s characterized much of the past decades, much of which relied on the importation of cheap labor from the Chinese countryside into rapidly growing metro areas. Over 480 million Chinese moved from the country to the city in pursuit of better economic opportunities, and real estate developers were only too happy to provide the accommodations that the newly urbanized Chinese both needed and could suddenly afford.

Real estate developers and construction firms weren’t the only ones to profit from the unprecedented mass urbanization. Regional governments—many of which relied heavily on land sales for revenue—encouraged as much development as possible, and the seemingly endless demand for housing gave yield-starved Chinese investors a place to park their capital. Developers soon found themselves unable to keep up with the pace of demand and began to take on massive amounts of debt, much of it in dollar-denominated offshore bonds, and even started selling properties in developments that hadn’t even begun construction.

China’s government took notice of all this rampant speculation and took what it saw as reasonable steps to mitigate the threat of the collapse of the real estate market. It imposed new financing restrictions for developers based on their liabilities, debt, and cash holdings, as well as imposed new rules for banks to limit the amount of mortgage lending. Some developers, including the giant China Evergrande Group, were pushed into default by these new restrictions and were forced to put ongoing projects on hold while they sorted out their balance sheets.

Quirks in China’s real estate system meant that the newly paused or canceled projects were more than just the developers’ problems. Chinese homebuyers who had gotten mortgages and purchased unbuilt properties suddenly found themselves on the hook for properties that may never be completed, and many were understandably upset. More and more people began to protest the situation by refusing to pay their mortgages until upwards of $295 billion worth of loans were affected before the CCP started interfering with data collection on the subject. So far China’s government has been unsuccessful in trying to get the situation under control, though they are stepping up support for distressed developers and providing some special loans to help ensure certain projects are completed.  

How Will China’s Housing Collapse Affect the World?

The current crisis has severe implications for the wider China economy, some of which are already being felt. S&P Global Ratings has claimed that around 20% of the Chinese developers it rates are at risk of going under, and that falling land sales have impacted local governmental revenues to the point that 30% of local governments may have to cut spending by the end of the year. Nonperforming real estate loans held by state-owned banks increased by a full 1% in 2021, a figure that is sure to grow as more recent data is made available. There is every reason to believe that the real estate market will suffer in the short to medium-term.

Harvard professor Kenneth Rogoff estimates that a drop of 20% in real estate-related investments could cut 5 to 10% out of China’s GDP, and that the subsequent drops in real estate and construction employment could create significant instability in China’s job market. Or, more broadly: “On the medium term, China faces a multitude of challenges, ranging from extremely adverse demographics to slowing productivity…Until now, the housing boom has been sustained by a broad economic boom that now faces steep headwinds.”

The intentionally opaque workings of China’s government make it difficult to predict exactly how the current crisis will play out. It is, however, possible to extrapolate the kind of impact the crisis may have on the global economy if China’s real estate market continues to deteriorate. The first and most obvious consequence of a serious slowdown in China’s economy will be felt by companies with significant exposure to China. Firms like Wynn Resorts, Apple, Tesla, and Disney would all suffer from the ensuing loss of revenue from China’s market, as would firms like Qorvo, Boeing, Caterpillar, and any other firms that rely on supplies from or sales to China.

In terms of Chinese companies, the ratings agency Fitch identified three main sectors that would be most vulnerable to a slowdown in the real estate market: Asset management companies, engineering and construction firms, and steel producers. Fitch also believes that small and regional banks would be most vulnerable to continuing difficulties—particularly if the trend of homebuyers refusing to make mortgage payments on properties that may not ever be built continues—though this may have little impact on the global economy beyond the consequences of a slowdown in China’s economy at large.

Conclusion

As dire as things may seem, however, it is important to remember that China’s government is acutely aware of the risks its economy faces from the current crisis. Pundits, analysts, and observers alike have been warning about an imminent collapse in China for years now, yet the closest we’ve seen was a self-imposed downturn that resulted from the government’s draconian attempts to eradicate COVID-19 within their borders. There is little reason to assume that China’s government’s control over their economy has slipped to any significant degree. Anathema as it may seem to western sensibilities, China’s government still possesses the tools, the will, and the monopoly on violence it needs to prevent the real estate market from destroying their economy as a whole.

The best response, for now, is to maintain the course. It may be a good idea to close positions concerning firms with significant exposure to China’s economy, but treat all other investments the same way you would when facing any other kind of economic headwinds. If the economies of Europe and the United States made it through the 2008 housing crisis, chances are China’s economy will weather this storm as well.

The post China’s Housing Crisis: What Investors Need to Know appeared first on Wall Street Survivor.

Intro to Alpha Picks Review

Seeking Alpha’s newest product “Alpha Picks” claims to clue you in on the best stock picks before they skyrocket. Let’s review Alpha Picks and see how they stack up against the competition.

Predicting where the stock market is going is…hard. You can stare at charts all day. You can draw trendlines, calculate moving averages, perform technical analysis, consult shamans, sacrifice goats, watch to see if Warren Buffet sees his shadow, etc, etc. 

Many folks prefer to park their money in a 401(k) or hand it over to money managers who may or may not know what they’re doing. There’s nothing wrong with that, not everyone has the time, expertise, or testicular fortitude to take their portfolio into their own hands, but even the most steely-eyed quants need a little third-party advice based on rigorous analytics sometimes. 

On that note, may we introduce you to our friend Alpha Picks? 

Quantitative Easy

Alpha Picks, the newest service from the mad geniuses at Seeking Alpha, is designed specifically for investors looking to turn the market’s noise into actionable insights. 

If you’re familiar with Seeking Alpha you already know just how much cognitive firepower they bring to the table. If you aren’t familiar with Seeking Alpha you should be ashamed of yourself here’s a quick overview.

How Seeking Alpha Seeks Alpha

Seeking Alpha is a website, community, and crowdsourced research platform made by and for investors. The site hosts the world’s largest investing community—boasting a staggering 20 million visitors every month—and offers an unprecedented array of analyses, market-specific news, and investing tools that rival those found on Wall Street trading terminals. 

In addition to all of the above, Seeking Alpha is also home to possibly the largest collection of crowdsourced investment theses written, reviewed, and debated over by professional investors. Some 7,000 well-vetted contributors post over 10,000 investing ideas every month, each of which is reviewed by Seeking Alpha editors to make sure every post meets their quality standards. 

As if that weren’t enough, Seeking Alpha also hosts news, discussions, and data-driven analyses on small-cap stocks, commodities, ETFs, cryptocurrencies, and just about any other security on the market. And if you want to go even deeper, Seeking Alpha’s PREMIUM subscription gives you access to a frankly insane amount of investing ideas, data visualizations, and author, quant, and dividend ratings—plus the ability to track the performance of individual authors. 

In other words: It’s quant heaven. 

Now that you have a sense of where their information is coming from, let’s get back to the reason we’re all here: Alpha Picks.

What Makes Alpha Picks Different

Finding great stocks to buy on Seeking Alpha can be a bit like panning for gold. It can take a while to sift through all the good stuff to get to the truly great, and there’s so much valuable information that the market might have moved on by the time you’re done reading through the research, scanning the charts, and checking out all the discussions. 

If you’re thinking that it’d be great if Seeking Alpha had a service that did all the gold panning for you and just handed you the biggest, shiniest nuggets, guess what: they’re two steps ahead of you. 

Alpha Picks is a subscription service that Seeking Alpha designed for that exact purpose. It takes all the information from the Seeking Alpha Quant model and filters it all down to the two stocks with the biggest potential for positive share price growth every month. 

A lot of stock picking services hide their methodology for any number of reasons—to build mystique, because they’re afraid someone will steal their proprietary recipe, because they identify with the Wizard of Oz from The Wizard of Oz, etc—but not Alpha picks. Their methodology and stock criteria are fully transparent, and their results speak for themselves. 

But don’t take our word for it. Here’s a quick overview of how Alpha Picks stack up against two of the more prominent stock picking services out there: The Motley Fool and Zacks. 

Alpha Picks Review: Stock Criteria

Alpha Picks

To qualify for Alpha Picks, a stock must:

• Hold a Strong Buy Quant rating for a minimum of 75 days
• Have a market cap of $500 million or more
• Be traded as a common stock on standard exchanges
• Have and maintain a stock price of over $10 per share
• Have not been previously recommended within at least one year of the time of selection

The Motley Fool

To qualify for a recommendation by the Motley Fool, a stock must…

• No idea

The Motley Fool doesn’t make their stock picking methodology available on their website. Or maybe they do if you pay for their premium services, but who knows?

Zacks

Zacks has a list, the Zacks Rank, which rates stocks between 1 (strong buy) to 5 (strong sell). It apparently uses a set of formulas to leverage earnings estimate revisions to predict stock price growth and assigns letter grades (A-F) for any given stocks’ value, growth, and momentum. 

The good stuff, the Zacks Rank #1 list, is hidden behind a paywall, but presumably it works much the same as the regular Zacks Rank. 

To qualify for the Zacks Rank #1 list, a stock must:

• Pass some quantitative test 
• Get good marks on their proprietary equity research reports 
• Make it through their earnings estimate revisions formulas with a good rating

So essentially Zacks is very similar to the Motley Fool when it comes to concealing their methodology.

Alpha Picks Review: Portfolio Process

Alpha Picks

Alpha Picks is tailored for investors who like to buy and hold stocks for longer periods of time, and their process reflects that ethos. 

• One stock is picked on the first trading day and the closest trading day after the 15^th of every month 
• Stocks that have dropped into Sell or Strong Sell territory will be sold at the beginning of each month
• Stocks that are rated Neutral for over 180 days will also be sold
• (Simulated) cash generated from dividends and asset sales will be reinvested immediately
• Stocks that have doubled in price since purchasing gets a Sell or Strong Sell recommendation, though only the initial investment will be sold 
• A stock will be sold if another Sell or Strong Sell is triggered while the stock has less than twice the value of the initial investment

Pretty straightforward, right? 

The Motley Fool

Once again, the methodology for the Motley Fool’s portfolio process is hidden (possibly behind a paywall). The closest we have is the six-step investing philosophy on their website:

1. Buy 25+ companies over time
2. Hold stocks for over five years
3. Add new savings regularly
4. Hold through market volatility
5. Let your winners run
6. Target long-term returns

Zacks

It’s not entirely clear whether Zacks follows the same portfolio-based model as Alpha Picks and the Motley Fool, though again there may be more clarity hidden behind their paywall. That said, it’s probably safe to assume that their portfolio process, if any, is based on their Zacks #1 Rank list. 

Alpha Picks Review: Performance

Alpha Picks

Although they are packaging Alpha Picks as a new product, Seeking Alpha’s Quant Rating has been picking rocketship stocks for years. With Alpha Picks, you are getting the cream of the crop of their highest rated Quant Stocks. So if you take a look back at the their Top Rated Quant Stocks since 2010, you get this mind-blowing chart:

You don’t have to be a mathematician to appreciate numbers like that. 

Alpha Picks’ portfolio has seen a return of over 470% since 2010 compared to a 290% return from the S&P 500 as a whole, meaning Alpha Picks has outperformed the S&P 500 by 180% over the past 12 years. 

The Motley Fool 

The Motley Fool measures their returns since their inception in 2002 as opposed to 2010 for Alpha Picks, but the timeframes don’t need to be exactly the same to get a sense for their overall performance. 

According to their site, the stocks picked by the Motley Fool have outperformed the market by 3-to-1 over the last 20 years. Their ads and other content on their site make it a bit harder to tell what’s what—one ad says “STOCK ADVISOR VS S&P 500 +400% vs + 128%” which, what?—so let’s go with the 3-to-1 figure. 

Zacks

Zacks’ website says that stocks that Zacks ranks as a #1 Strong Buy have outperformed the S&P 500 by an average of 13.9% each year since they started picking stocks 34 years ago. 

It’s tough to provide an apples-to-apples comparison here, but suffice to say all three services do a good job of beating the market. 

Pricing

Alpha Picks

A subscription to Alpha Picks will net you two top-quality stock recommendations a month for a discounted rate of $99 per year. Its actual (not discounted) price is $199 per year, so you should make sure to take advantage of the discounted rate while you can. 

The Motley Fool

The Motley Fool’s Stock Advisor service is $199 per year, but that’s far from the only service they offer. Their Epic Bundle, which gives you access to Stock Advisor, Rule Breakers, Everlasting Stocks, and Real Estate Winners is $499 per year, and their other services range from $100 for a single stock recommendation to an option called One, which provides full access to all of their services for $13,999 per year. 

Zacks

Zacks’ services range from $249 per year for Zacks Premium, to $495 per year for Zacks Investor Collection and $2,995 per year for Zacks Ultimate, which gives you access to pretty much everything Zacks has to offer. 

Conclusion

There are a lot of quality stock picking services out there, and Alpha Picks is hitting the ground running neck-and-neck with the best of the best. Alpha Picks gives you all the research and quantitative excellence that you’ve come to expect from Seeking Alpha, a promising portfolio with transparent and rigorous methodology, and a price point that’ll pay for itself in no time at all. 

The post Alpha Picks Review by Seeking Alpha (plus vs Motley Fool and Zacks) appeared first on Wall Street Survivor.

We learn a lot of stuff in school. Math. Science. History. Why it’s a bad idea to throw parties at your house when your parents are out of town. 

But there’s one subject that’s as important and many times absent from curricula: Personal finance.   

Let’s face it, everything’s getting more expensive and wage growth just isn’t keeping up. Most of us are having to do more with less, and we can’t all win the lottery or marry a wealthy widow.

Keeping a proper budget has never been more important, and the lack of formal personal finance and budgeting classes means the burden of teaching students how to manage their money has fallen on individual parents, teachers, and professors.

The bad news is that keeping students engaged and learning is harder than ever in the age of TikTok and nanosecond attention spans, and that goes double for dry subjects like personal finance and budgeting. 

The good news is that there are some very, very smart people out there who understand the importance of budgeting, how difficult it is to get students to care, and the best methods for getting students to engage with and learn about personal finance. 

What is the best method, you ask? One word: Gamification. 

Here are some of the best personal finance and budgeting games for kids, high schoolers, and college students. 

The Best Budget Games for Students

Okay, we all know there’s practically no chance you’re going to get elementary school-aged kids to sit down and put together a budget no matter how much candy or colorful flashing lights you throw at them. But middle school kids? Middle school kids can be tricked. 

Enter the bean game. Available for the best price ever—free—all you need for this game is a few kids, a printer, and a couple handfuls of jellybeans. 

The game is simple. Each kid receives a salary of 20 jellybeans, a game board, and a reminder that eating their beans will make them poor. 

Each board contains a set of spending categories like housing, food, transportation, insurance, and recreation. 

The kids will have to divide their beans between the categories, some of which will have to go to necessities like housing and food. The rest can be divvied up (or eaten) as the kids choose. 

It’s a simple game, but it does have all the ingredients you need to start a conversation about finite resources, wants versus needs, and, hopefully, about how the money they spend on iPhone games is money their parents could have otherwise spent on college. 

No Beans for Teens: PersonalFinanceLab, the Best Budget Game for High School Students

High school can be tough, but it’s important that high schoolers know that real life will be exponentially tougher…if they don’t know how to properly manage their money, that is. 

Thankfully there’s a budgeting game that’s tailor-made for teachers and students alike: PersonalFinanceLab. 

PersonalFinanceLab gives you everything you need to teach kids about managing a household budget. 

Its streamlined interface lets you get up and running in minutes, and its deep mechanics and fully customizable parameters let you create personalized scenarios for students in all income levels and career tracks. 

Want to motivate students by showing them how hard it would be to get by with the money they’d make working at McDonald’s? PersonalFinanceLab has you covered. 

Want to show your students why it’s a bad idea to carry a balance on their credit card without lecturing them? PersonalFinanceLab lets you adjust interest rates, simulates balance increases, and includes embedded lessons that break down the concepts in an approachable way. 

Rent. Income tax. Part time versus full-time work. PersonalFinanceLab lets you customize all of it to fit the cost of living and prevailing wages in your community. 

And best of all? PersonalFinanceLab is only $10 per student, and only $6 per student in classes of 10 or more. That won’t be a stretch for even the tightest school budgets. 

Stock-Trak: The Best Budgeting Game for College Students

Their brains may not be fully developed, but college students are (usually) mature enough to wrap their heads around the complexities of managing their finances in the real world…and yet surprisingly few of them receive the instruction they need to do just that. 

In an ideal world there would be a program that could walk college students through budgeting and investing in and out of the classroom. A program that professors could customize to fit their students’ specific needs, and that would supplement the built-in lessons with integrated quizzes and gamified scenarios. 

It’s too bad no such program exists. Oh wait a second. 

Stock-Trak is a software platform that does all of the above and more.

Not only does Stock-Trak bring over 30 years of expertise to the table, it comes jam-packed with an ever-growing list of lessons, interactive scenarios, and an innovative gamification system that can keep even chronic sufferers of senioritis engaged with the material. 

Stock-Trak is more than just an educational program, it’s a whole ecosystem of customizable curriculum and powerful tools that make delivering important information and keeping track of your students’ progress so easy you’ll almost forget you’re working at all. 

And here’s the best part: Over 1,000 universities already use Stock-Trak to teach their students about budgeting and investing.

Stock-Trak helps over 1,000,000 students learn how to manage their money every year, so you know you’ll be spending your budget wisely if you sign up. Stock-Trak even offers demos, too, so you don’t have to spend a dime unless you think it can help prepare your students for the real world. 

BudgetChallenge.com

PersonalFinaceLab and Stock-Trak try to make budgeting and personal finance seem interesting and engaging. BudgetChallenge.com, while retaining much of the same essential functions, doesn’t have the same quality of user experience and gamification.

BudgetChallenge comes with the benefit of being free to qualified schools. It comes in the form of 10-week modules that give students hands-on experience with budgeting via in-depth simulations (IE lots of spreadsheets) that cover things like cash flow budgeting, emergency funds, and credit management. 

BudgetChallenge is perfect for teachers who like a more traditional approach to education. The front page of its website contains such charmingly off-putting remarks like “Aren’t you tired of reading about how young adults are making a mess of their financial lives?” and pictures of trophies – a halfhearted attempt at gamification.

Conclusion

Budgeting is a crucial skill that most students don’t learn until it’s too late, but you can change that. 

The services listed here are the best of the best; they’re intuitive, customizable, and reasonably priced, and even the most tight-fisted admins will have to acknowledge the amount of bang you’ll get for your school’s buck. 

It doesn’t take much to change a student’s financial trajectory, and you’re just the person they need to make that happen. 

The post Best Budget Games for Students appeared first on Wall Street Survivor.

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At WallStreetSurvivor, you can manage your trade settings and practice investing solely in Cryptos. This is the perfect way for crypto-curious investors to start without risking their savings. 

If you’re not ready to focus solely on cryptos, you can change your trading settings as you go! 

That makes you can: 

• Day trade 
• Short Sell 
• Trade on Margin
• AND invest in cryptos!

All Wall Street Survivor accounts (that verify their email address) can:

• Create your own contests and invite your friends
• Take our FREE Courses
• Join other contests

Invite your friends and family to join you in some friendly competition! Customize your trading settings–you can even set up a contest to exclusively trade cryptos. Be the reason you and your friends feel confident to invest in the real world! 

Looking to educate yourself first? We have you covered! 

This is an excellent opportunity to make all your mistakes before using real money. And if you need some help getting started, we have courses and articles introducing you to the investing world.

Here is a short list of some of our most popular courses and articles:

• Cryptocurrency – What You Need to Know
• Value Investing for Beginners
• Robinhood Crypto Wallet: What You Need to Know
• eToro vs Coinbase
• Best Investing Courses 2022: Courses for Every Investor

We are constantly evaluating all types of financial tools, from stock picking newsletters to brokerage apps, stock screeners, and more!

Wall Street Survivor’s YouTube channel has plenty of videos on topics ranging from basic stock market knowledge to product reviews to cryptocurrency insights.

Head over to the channel, and don’t forget to subscribe and hit the notification bell!

Follow us on social media to learn more about the best services in the financial world and stay informed on market trends.

• Facebook
• Twitter

After you’ve learned and practiced for free on Wall Street Survivor — we won’t leave you to fend for yourself! For information about buying cryptos in today’s market, check out our articles and services:

• Best Crypto Exchanges in 2022
• Is Seeking Alpha Worth It?
• Morning Brew Review
• Motley Fool Review

The post Getting Started With Cryptos appeared first on Wall Street Survivor.

Introduction to Dividend Stocks

There are a few different ways to make money on the stock market. 

You can buy low and sell high, of course, or you can short the market by selling high and buying low, or you can buy a bunch of dividend stocks, kick back, and let the payments pile up. 

Dividend Stocks Are Stocks That Pay More than Just Returns  

Profitable companies have to decide what to do with their profits at the end of their respective fiscal years. 

Some choose to invest their profits back into their business in the form of capital improvements, infrastructure or IT upgrades, or headcount increases, but some take a slightly different tack and decide to pay out those profits to their shareholders. We call those payments “dividends.” 

Investing in Dividend Stocks

Dividend stocks don’t always keep up with the market overall in terms of share prices, and growth stocks typically reinvest their profits in the business rather than pay them out in dividends, but that doesn’t mean dividend investing is a bad idea. 

Think of it like this: If a company like IBM is able to pay a dividend year after year regardless of the prevailing market or economic conditions, owning shares in IBM almost guarantees a return on your investment even during bear markets and periods of economic stagnation. 

And while dividend stocks may not always come with the same potential for share price appreciation as the rest of the market, their dividend payments provide both a steady source of return and a boost to the overall return on your investment. 

Who Let the Dogs (of the Dow) Out? 

The most straightforward and least time-consuming way to get into dividend investing is an approach called the Dogs of the Dow strategy. 

The Dow Jones Industrial Average, as you may know, is a major stock index that tracks 30 of the largest public companies in America, many of which dole out dividends like clockwork. 

The Strategy is fairly simple: All you have to do is identify the 10 or so stocks on the Dow with the highest dividend yields (Equal to the annual dividend / the current stock price) and invest in them. 

Why is it called the Dogs of the Dow Strategy, you ask? Great question, and the answer is also fairly simple: Math. 

A company’s dividend yield goes up when they increase their dividends, but it also goes up when their share price drops—provided the dividend stays the same. 

The Dogs of the Dow Strategy looks for companies whose dividend yields are high and/or have risen recently, IE companies whose share prices have dropped recently. 

Stocks that have seen big drops in price don’t look very attractive (like dogs) to most investors, which is where the strategy gets its name. 

The strategy is effective for a few reasons. 

• Blue Chip (Dow Jones) stocks are reliable earners and almost always regain their value
• You get a steady stream of dividends from reliable companies  
• You get both the dividends and the potential upside from increasing share prices

Now that that’s out of the way, here are some of the best dividend stocks you can buy in 2022.

International Business Machines (IBM)

IBM is still a damn fine company with a stable business model and a history of consistent quarterly dividends, even if the days of “nobody ever got fired for buying IBM” are behind us. 

IBM’s shares are trading at $130.95 at the time of writing, and each share entitles the holder to a quarterly dividend of $1.65, equivalent to about a 5% annual dividend yield. 

Granted, a 5% annual return isn’t that great compared to the market’s average 10% annual growth, let alone to the upside potential of some individual stocks, but there’s something to be said for consistent returns that aren’t affected by market fluctuations. 

Last but not least, it’s worth noting that IBM is a stable, established company that’s pretty well insulated against market forces—meaning you won’t have to worry if your dividend payments are going to show up next quarter or for the foreseeable future. 

Caterpillar Inc.

Caterpillar is another stable, mature company with a long history of growth and consistent dividend payments. 

How consistent are we talking? How does never missing a dividend payment since 1933 sound to you? 

Their dividend isn’t that much—just $1.20 quarterly, a roughly 2.5% annual dividend yield—but that’s on top of the stellar 69% growth their share price has seen in the last five years. 

Caterpillar is a solid investment in pretty much every respect, and their 28 consecutive annual dividend increases strongly implies their dividend payments will only get bigger in the future. 

Essex Property Trust

What do you get when you combine a real estate investment trust that invests in multi-family housing on the west coast with the housing crisis on the west coast? Money, mostly. 

Essex Property Trust didn’t make it on this list because it’s a household name, it made it because it’s a mature player in a no-brainer business that’s posted consistent profits and increased their dividend 29 years in a row. 

 
Its quarterly dividend payment of $2.20 per share may only amount to an annual dividend yield of about 3%, but that single stat doesn’t tell the whole story. 

Not only has the company seen sustained growth since it went public in 1994, it’s also increased its overall dividend nearly 200% over the past 20 years. 

Essex Property Trust won’t be changing the world as we know it or making any major waves in its industry anytime soon, but you can bet your butt that it’ll keep posting solid numbers and paying out dividends like clockwork. 

Microsoft

Speaking of reliable but not necessarily exciting companies, have you met my friend Microsoft?

Okay, a $0.62 quarterly dividend with an annual dividend yield of 0.85% isn’t great, but Microsoft has some good things going for them. 

For one: Microsoft is a global player with decades of proven performance. That’s nothing to sniff at. 

Microsoft’s share price has also rocketed up nearly 300% over the last five years—not too shabby for a corporation that’s almost 50 years old—so you can expect its shares to keep appreciating (unless something terrible happens) on top of the dividend payments.

And speaking of dividends, think back to IBM for a second. Its dividends have increased as its business has matured and its capital has found fewer productive outlets, right? 

Well think of it like this: Microsoft’s posted 12 consecutive years of dividend increases, and it isn’t signaling any major moves into costly new lines of business, so isn’t it reasonable to think they might keep on boosting their dividends as time goes on (like IBM. In case you didn’t follow that).

Lowes 

Lowes is another established company with a long history of paying dividends and a steadily growing business (seeing a pattern here?).

Their current dividend, $1.05 per share per quarter, only represents a 2% annual yield, but there’s plenty of upside potential with the stock itself. 

Though it’s down from its high earlier this year, Lowes’ stock price has grown by 160% in the last five years, and the current housing market implies that the DIY and home improvement trend will continue for some time. 

Conclusion

Dividend investing isn’t for everyone. It involves a lot of holding onto stocks for a long time—not too appealing for people with itchy trigger fingers—and is best suited to patient investors looking to follow a longer-term plan. 

It is usually a good idea to have at least some dividend-paying stocks in your portfolio for cash flow, reinvestment, and inoculation against market forces, however, so definitely don’t rule dividend stocks out when you’re looking for new investment opportunities. 

The post Best Dividend Stocks of 2022 appeared first on Wall Street Survivor.

Intro

With constant new ways to trade cryptocurrencies, we all have at some point wondered: what are the best crypto exchanges?

Cryptocurrencies have exploded in popularity and numbers since Bitcoin first launched back in the distant past (2009).

It seems like more and more cryptocurrencies hit the market every day, and new crypto exchanges have been popping up at nearly the same rate.

Trading crypto is easier than you might think—especially after you’ve learned and practiced for free right here on Wall Street Survivor — but how do you choose which crypto exchange you want to trust with your money?

Check out this quick list of recommendations for the best crypto exchanges out there in 2022. 

Best Crypto Exchange for Beginners

Coinbase

Coinbase is one of the larger and most established crypto exchanges out there. 

Their site lists over 10,000 cryptocurrencies you can trade on the exchange, which can obviously be overwhelming to new investors, but their extensive list of tips, tutorials, articles, and newsletters will help guide you every step of the way. 

Seriously, the people at Coinbase know how confusing all this crypto talk can be, so they’ve really gone above and beyond with their educational materials. 

You can find in-depth articles on everything from the underlying technologies that make cryptocurrencies work, how to spot investment opportunities, and even how to figure out how your crypto holdings will affect your taxes. 

And as if that wasn’t enough, Coinbase even has a program that rewards you with free crypto for completing learning modules via their Coinbase Earn program.

It’s not every day you get paid to learn, but Coinbase is just that committed to making sure you know what you’re doing before you start investing…almost like they want their customers to succeed, or something.  

Coinbase also comes with a streamlined interface that makes finding, buying, and selling different coins easy as pie, and their transaction and conversion fees are very reasonable compared to some of their competitors. 

The one thing Coinbase is missing is a good way to practice investing without using real money, but thankfully you can do that right here for free on Wall Street Survivor. 

Best Crypto Exchange for Passive Investors

Abra

Looking to buy and hold onto some crypto without making too many trades? Look no further. 

Abra is a reasonably large exchange—about $1.5 billion in assets under management, over $7 billion in transaction volumes—that’s available in over 150 countries.

Its roster of over 80 popular cryptocurrencies (Bitcoin, Etherium, Dogecoin, etc) isn’t as impressive as some of the other exchanges out there, but a passive investor probably doesn’t want or need to speculate or trade on smaller coins. 

Abra doesn’t charge transaction fees, just a spread fee built into exchange rates, so you can trade to your hearts content, though that probably won’t be as important to passive investors as it would be to day traders.  

The real draw for passive investors isn’t Abra’s product offerings or transaction fees, it’s the fact that Abra will pay you up to 10% interest on any crypto you keep on their platform. 

Passive investors could do a whole lot worse than making up to 10% interest (compounded daily and paid out every week, no less) just by holding onto their crypto on top of the upside potential from the coins themselves. 

Abra also offers low-interest crypto loans to its members that start at 0% APR, which isn’t super helpful for passive investors but is still cool enough to warrant a mention here. 

Best Crypto Exchange for Day Traders

Crypto.com

Surprise, surprise; Matt Damon might actually know what he’s talking about!

Crypto.com isn’t just one of the biggest, most polished exchanges on the scene, it’s also one of the highest-rated and most-recommended platforms available. 

You’ve probably run across crypto.com in your quest to find the best crypto exchange, and it seems there’s a reason for that. 

Crypto.com accepts over 20 fiat currencies and lets you trade in over 250 cryptocurrencies, tracks prices in real time, and gives you access to an incredibly liquid market populated by over 50 million other users. 

The crypto.com desktop platform has everything you need to find, trade, and keep track of your favorite coins, and the mobile app is just as packed with features and useful information.

Day traders will love the fact that you can pull up charts, track trading volume, and see which coins made the biggest moves in any given day, and day traders on the go will love the fact that all that functionality is available on the crypto.com app, too. 

On top of all that, the crypto.com platform also crawls the net to find mentions of specific coins on twitter, reddit, and other social media, which is perfect for the plugged-in trader who wants to take the temperature of the market without setting up a bunch of alerts and doing hours of searching themselves. 

Crypto.com also has you covered if you’re looking for a place to trade NFTs, and their one-stop DeFi wallet app (and browser extension) gives you a great place to store, swap, and send your NFTs and crypto. 

Best Crypto Exchange for Security-Conscious Traders 

Gemini 

Gemini is one of the older exchanges that’s still operating today, and its longevity isn’t an accident.  

In addition to its semi-famous roots—it was founded by the Winklevoss twins, AKA the guys Mark Zuckerberg screwed over in the Social Network—Gemini is probably most notable for the fact that it’s been working closely with regulators to bring greater security and legitimacy to cryptocurrency since it was founded back in 2014.  

Working with regulators might not sound very cool or punk rock or whatever, but it’s hard to argue with the rigorous security measures Gemini has put in place as a result.

Gemini’s security measures start from the second you try to sign up, and are actually rigorous enough to put some users off.

The first thing you’ll notice is that Gemini requires the same, if not more, security measures you’d expect if you were trying to open a bank account or get a mortgage. 

They want your full name, your address, your phone number, at least one form of valid ID, your same-sex celebrity crush, all your fingerprints, toe prints, tongue print, eye print, DNA—okay, everything after “valid ID” is a lie, but still. 

Two-factor authentication is required to access your account (not recommended, required), new devices are subject to verification if you try to sign on, and they even use machine learning algorithms to catch suspicious activity on your account if you get hacked. 

And speaking of hacking, you know how a lot of exchanges are basically big digital bank vaults waiting for hackers to bust in and rob? Yeah, not Gemini. 

Instead of leaving their assets on servers connected to the internet, Gemini puts all their (and your) valuables into “cold storage,” which basically means “they turn off the Wi-Fi in the server room,” but sounds a lot cooler. 

It’s safe to say that Gemini has the security of your account and your assets at the top of their minds, so you can breathe easy if you’re worried about scams or hackers. 

The main downside to trading on Gemini is that it’s not as big or popular as some of its competitors, which means there aren’t as many people to trade with or as much liquidity in the market. 

This may or may not be a big deal to you, but it’s certainly something to keep in mind before you sign up. 

Best Peer-to-Peer Crypto Exchange (for Bitcoin)

Bisq

Do you like feeling like an outlaw? Do you like operating off the grid? Do you like exchanging currency for Bitcoin, selling that Bitcoin for a different currency, and using that currency to buy more Bitcoin? You are going to love Bisq.

This decentralized, open-source software runs off a peer-to-peer network of anonymous users located around the world and hidden from prying eyes by a combination of local-only storage and the same obfuscation technology used by the Tor browser. 

There’s no identity verification, no strict rules, and no central authority running the show. 

Trades are made by simply making or taking offers, transactions are completed and secured by holding deposits in 2-of-2 multisig wallets, and it’s all done between individual users with no moderation or oversight. 

In other words: It’s pretty much the opposite of Gemini. 

Bisq is great if you want to feel like a hacker while you trade Bitcoin, but all that freedom and anonymity comes at a cost—namely at the expense of literally every other cryptocurrency. 

As cool an idea as Bisq may be, being limited to Bitcoin may be a dealbreaker for some people. 

That being said, you’d be hard-pressed to find an open-source, decentralized platform that’s as robust or as well-designed as Bisq.

Conclusion

There are a ton of different crypto exchanges vying for your business, but not all of them are worth your time. Make sure you pick an exchange that has the right mix of features, products, fees, and security before you invest your money…and it never hurts to prepare by practicing your crypto investing right here on Wall Street Survivor.

The post Best Crypto Exchanges in 2022 appeared first on Wall Street Survivor.

Intro

It’s never been easier to take investing into your own hands. 

There are dozens of investing apps and trading platforms out there, and picking the right one is almost as hard as picking the right assets for your portfolio. 

E*TRADE and Robinhood may be two of the most recognizable names in the space, but which one is better for you?  

Keep reading for a quick breakdown of what each platform has to offer in terms of asset classes, markets, analytical tools, research, fees, and other important factors before you decide which to trust with your hard-earned capital. 

The Platforms – Overview 

Robinhood

Though Robinhood has a desktop site, it’s a mobile-first platform through-and-through. 

Robinhood’s interface is sleek, simple, and easy-to-navigate, perfect for checking stock prices and making quick trades on the go. 

That simplicity comes at a cost, however. 

Robinhood has emphasized ease-of-use over functionality, and that shows when you try to chart your investments, access detailed research, or anything beyond searching for assets and making quick trades. 

Although they’ve improved their access to market news, they never intended to have in-depth analytics and research. So if that is an important feature to you, you’ll likely need to go elsewhere.

E*TRADE

E*TRADE has desktop and mobile versions of both its regular E*TRADE and Power E*TRADE platforms. 

The normal E*TRADE platform is packed full of valuable resources for veteran investors, and Power E*TRADE goes a few dozen steps further with interactive charts and a whole range of analytical tools that give you all the power you need to invest like a pro. 

Both E*TRADE platforms are a little less streamlined than Robinhood’s, but if you love analysis and research, a few more menu items to sort through is a small price to pay for all the added functionality. 

Markets and Asset Classes 

Both E*TRADE and Robinhood let you trade stocks, ETFs, and options contracts on the major American exchanges, though only E*TRADE lets you trade mutual funds, commodity futures and options, fractional shares, penny stocks, and stocks on international exchanges. 

Robinhood does have one big advantage over E*TRADE, though: cryptocurrencies. 

E*TRADE lets you trade Bitcoin futures on its platform, but that’s the extent of its participation in the crypto markets. 

Robinhood, on the other hand, has a full-fledged crypto wallet built into its app and lets you trade Bitcoin, Etherium, and tons of other cryptocurrencies on its platform with zero fees or commissions, making it the obvious choice for investors looking to trade crypto and not a whole lot else. 

Education 

E*TRADE comes out as the clear winner in this category as well. 

You can find plenty of articles and links to relevant podcasts etc on Robinhood’s platform, as well as a decent number of resources designed to teach investing concepts and terminology to newbies, but you’re out of luck if you want anything more substantial than simple definitions. 

E*TRADE, on the other hand, has a whole library worth of information for newbie investors and veterans alike, plus tons of content for people interested in long-term investing.  

On top of tutorials, articles, and helpful videos, E*TRADE also offers what they call Virtual Learning Environments; all-day online classes with specific learning objectives that can benefit investors of all skill levels. 

Research 

E*TRADE has invested a lot more resources than Robinhood in this category. 

Robinhood will give you some stock research and ratings from Morningstar if you pay $5/month for Robinhood Gold.

E*TRADE gives you research and ratings from Morningstar for free, and it gives you access to research from other top firms like Thomson Reuters, MarketEdge, Moodys, Trefis, and more…for free. 

On top of all that, E*TRADE even has a tool for screening stocks and securities to meet criteria of environmental, social, and governance criteria, perfect for the socially and environmentally conscious investor. 

Analysis Tools 

Robinhood has some basic charting functionality, and it can do some simple account analysis like identifying balances, percent gain, dividend history, and so on, but its tools are basic compared to E*TRADE’s. 

And as impressive as E*TRADE’s portfolio analysis tools are, the real star of the show is in Power E*TRADE’s charting and analytical functions. 

Power E*TRADE’s interface makes it easy to create and edit charts on just about any security over any time period, and its built-in technical analysis functions help you predict where the market will go with technical studies and automatic support and resistance lines for identifying patterns. 

As if that weren’t enough, Power E*TRADE lets you perform snapshot analyses to help determine whether an option trade will pay off, and its powerful scanning function lets you use real-time data to identify potential trades with just a couple clicks. 

Costs and Fees

Opening and maintaining an account (even an inactive one) is free at both Robinhood and E*TRADE, and neither platform charges for stock or ETF trades, though their fee structure differs in most other areas. 

Robinhood doesn’t charge for options trades, for instance, while E*TRADE charges $0.65/contract if you’ve made less than 30 trades per quarter or $0.50/contract if you have made more than 30 trades. 

The platforms also charge different fees for margin: Robinhood charges a flat 9% on margin, Robinhood Gold includes $1,000 of margin for $5/month and 5% interest on margin over $1,000, and E*TRADE’s margin rates range from 11.7% for less than $10,000 to 9.7% for $250,000 to $499,999.99.

Verdict

Robinhood and E*TRADE are both great platforms with lots of strengths, they just serve entirely different purposes and are meant for different types of investors.

If you’re a new investor looking for a simple-to-use search and trade interface on mobile, or you’re looking to have your cryptocurrency and stocks all in one place, Robinhood is your best bet. 

If you’re looking to learn, read intensive research, perform technical or portfolio analysis, or trade in anything more exotic than regular stocks and crypto, E*TRADE is the platform for you.

The post Robinhood vs E*Trade appeared first on Wall Street Survivor.

With the ongoing craziness of the 2020s many Americans have become discouraged from investing, due to increasing losses in many sectors across the market.

Cannabis Stocks

It can be particularly nerve-wracking to put more of your hard-earned paycheck into an account that has seen enormous volatility throughout the last couple of years.

Nevertheless, investors with a long-term point of view could see this market uncertainty as an opportunity to buy up high potential stocks for a significant discount.

So, aside from high flying tech companies such as Amazon, Apple, and Telsa, what other high growth options exist?

One interesting option for investors is the cannabis industry.

Despite seeing significant share price declines this year, due to fiscal and legislative pressures, the US cannabis industry is expected to see legal sales topping 52 billion dollars in 2026 alone.

The sector as a whole is primed for growth, especially if federal legalization is brought forward during the current administration.

Trends

So, if cannabis stocks are so great why are their share prices dropping?

The primary reason for this downtrend lies in uncertainty surrounding the timing of federal legalizations on several accounts.

Most importantly when and how the industry will become legitimized by the federal government, and in the short-term when will banks be allowed to offer credit to current legal state run operations?

It is widely expected that either or both of these hurdles being eliminated could help cannabis stocks reach new heights.

According to Viridian Capital Advisors and others, the first chance for legislative change could come in late 2022 after the midterm elections.

Furthermore, they state that one of the biggest challenges for the industry is its inaccessibility for investors.

Many US cannabis stocks have to be traded as OTCs or over the counter equities, meaning it can be both harder to invest in them and also a riskier investment than NASDAQ graded stocks.

This is one of the biggest reasons US investors turned quickly to Canadian companies such as Tilray that were available to almost all mainstream investors. 

With all of these risks assumed, why would investors take the chance on the cannabis industry?

For one thing, almost all experts agree that legalization is a certainty in the future.

Well more than 50% of Americans believe that cannabis use should be legalized and its use is already legal in some form in 35 states.

Every year more states are expected to include recreational marijuana usage to their dockets, and eventually it’s expected that the federal government will do the same.

Once the cannabis industry is legalized and able to access investor and institutional capital, experts expect widespread opportunities and growth on both a domestic and international level.

For investors looking to take advantage of such phenomenal long-term expectations, 2022 may be the perfect year to invest.

With overall market downtrends and uncertainty, almost all sectors have dropped well below their 2021 valuations.

This widespread market pressure could allow investors to enter the cannabis industry for a significant discount, particularly if the industry makes legislative headway in late 2022. 

How to Invest in Cannabis Stocks

If you decide investing in the cannabis industry is the right option for you, what are the best and safest ways to go about it?

For the most part, buying individual US cannabis stocks can be tricky depending on your broker.

For investors that handle their own investing, make sure to check your broker for what options are available in the OTC market.

For other investors that prefer to invest in ETFs and/or through a traditional broker, there are a growing number of index funds and ETFs that widely cover and track the cannabis industry and could provide a way to invest without giving up the safety of diversification.

Furthermore, international cannabis stocks such as Tilray do trade on common exchanges such as the NASDAQ and are widely available to investors on almost every platform out there.

These stocks could provide a safe and proven entrance into the industry, without having to worry about the short-term risks surrounding US legalization. 

Overall, the cannabis industry has been an exciting sector to watch over the last few years and it’s expected to continue to see short-term volatility as the road to legalization continues.

For long-term investors looking to expand their portfolios at a potential discount, the marijuana business could offer significant upside.

Additionally, with increased accessibility to institutional capital, the cannabis sector could soar to new heights with a rush to acquire competitors and to expand with a large increase in funding.

Whether or not you decide to invest in the marijuana industry is up to you, but either way the sector is expected to continue to make headlines on its long and tumultuous road to both state and federal legalization across the United States.

The post The Future of Cannabis Stocks and How to Invest appeared first on Wall Street Survivor.

Starting to invest is one of the smartest decisions one can make in their entire life. It is a great opportunity to set yourself up for the future and save for retirement.

Not everyone wants to work forever but investing wisely can help you make sure that does not happen.

Investing from the outside might seem intimidating, and you may not know where to start. It is easy to get overwhelmed with all the different opinions out there and the chaos you might see in the news.

Being able to invest is such a valuable skill to have, but you do have to put the time and effort in.

To be a successful investor, ideally, you want to start early as possible. Starting early allows your investments to build interest for longer making you more money.

Another key is being disciplined and patient – this is especially important in 2022. The stock market over the past few years has done really well.

In 2019 the S&P 500 was up 28.88%, in 2020 it was up 16.26%, and in 2021 it was up 26.89%. However, so far in 2022, the S&P 500 is down around 20%.

During times of turmoil in the economy, it is easy to lose track of your investing strategy and panic sell. That is why having discipline and patience with your investments is so crucial.

In this article, we will cover some factors to consider when just starting and how to make your money work for you.

Getting Started

What age would you like to retire at? What do you want your life to look like in the future? How fast do you want to see results? There are so many factors to consider when determining your investment strategy.

Investing for the First Time – Budget

First, you need to figure out your investing budget. One of the biggest misconceptions is you need a lot of money to start investing when you do not.

You actually need to make sure you are financially stable to invest and able to invest often.

Financial advisors highly suggest creating an emergency fund. This fund prepares you for any unsuspecting costs life may throw at you.

In times of need, the last thing you want to do is sell your investments to cover your expenses.

All investments have risks associated with them and returns are not guaranteed. Sometimes your investments will be doing poorly, and you will need money.

Having an emergency fund gives you the money needed and keeps your investments growing. Financial experts recommend putting 3 to 6 months of expenses aside.

Investing for the First Time – Risk

Know your risk tolerance and how you feel when your investments are in the red. Every investment has risk, and you have to be content with potentially losing money.

People often say they have a high-risk tolerance until there is volatility and they panic sell.

It is important to find the balance between returns and the risk that comes with the investment. Looking at stocks and bonds, stocks tend to have higher returns, but higher risk.

Bonds have lower returns with less risk. There are ways to counteract risk like diversifying a portfolio.

Investing for the First Time – Strategy

What type of investor are you? Passive and active are two ways to go about investing. A passive investor thinks long-term and is not as involved.

The returns may take a while to come, but they will in the future. Usually, there is less risk involved and the effort is lower.

Long-term investors will invest in mutual funds that do the work for you. People saving for retirement usually take a more passive approach.

Being an active investor takes more time and research. You will need to conduct an analysis and be up to date with your holdings once purchased. There is more risk involved with actively managing, but the returns are much greater.

In terms of actual strategy, dollar cost averaging and lump-sum are two simple ways to go about it. A lump sum is where you invest a large amount at one time. The risk is higher, but you could see a quicker return on your investment.

Dollar-cost averaging is when you buy an asset regardless of price at specific time intervals. This can help eliminate risk. A combination of both strategies can lead to success as well.

Where to invest?

Once you are ready to start you have to decide who is managing your money. Investing yourself is very common with all the resources available in 2022; all you have to do is set up an online account.

You are responsible for your own choices, so you do have to spend time researching everything.

If you are not confident in yourself, there are financial advisors and Robo-advisors. An advisor keeps your goals in check and already has all the knowledge to make decisions. Make sure the advisor is fee-only and does not take commissions.

A Robo-advisor uses algorithms to make choices for you. They are cheaper than a real advisor but limited in overall wealth knowledge. To learn more about a robo-advisor, click here.

Investment Options

If you are saving for retirement, you likely have a 401(k) through your employer or a Traditional or Roth IRA. These accounts have tax benefits that allow your investments to grow tax-free for a long time.

For the regular investor, a taxable brokerage account can be open. Taxes are taken out for gains and withdrawals.

Once you figure out what type of account to open, what are you going to invest in? Let us take a look at some popular investment options.

Stocks

When done properly, investing in stocks is one of the most effective ways to build your wealth. A stock is a portion of ownership in a company.

There are so many different types of stocks out there varying in price, risk, company size, and potential. Individual stocks require a good amount of due diligence before being purchased.

Bonds

Bonds are a way for a company to raise money. You lend them your money now and they will pay you back after a certain number of years. They will pay you interest on your investment.

Bonds are less risky because you know how much you will be paid back. The returns are lower than stocks and should not be the only thing you invest in.

Funds

Mutual funds are a mixture of investments under one roof. They do the research for you by picking what stocks and bonds will be in the fund. Mutual funds are diverse and less risky than individual stocks.

Those saving for retirement often chose to invest in mutual funds due to the stability and quality long-term returns. Mutual funds are managed by professionals.

Index funds follow the performance of major stock indexes like the Dow Jones or S&P 500. For example, the S&P 500 is made up of major corporations like Amazon, Apple, Google, and many more. So, you are buying a stake in all these major companies without having to buy shares of each individual stock.

Exchange-traded funds

ETFs are similar to mutual funds but can be traded actively like a stock. Mutuals usually require a minimum investment whereas ETFs are purchased through shares.

ETFs are a viable option for those who want to diversify their portfolio with a smaller budget.

Wrapping Up

Investing in 2022 has never been easier. All the tools are in front of you, be responsible and start investing.

Investing is exciting, but you have to make sure you are financially ready and educated. It is so easy to make poor decisions and potentially lose everything. To avoid as many losses as possible try to follow these tips.

Quick Tips

Be consistent: Invest at regular intervals and check in on your investments somewhat often. Do not watch your investments too actively because that can lead to getting caught up in the yo-yo.

Think Long Term: Watching your investments go up and down can lead to stress which is never what you want. Think long-term and know that down spells have happened in the past. Do not panic and stick to your investment plan.

Diversify: Diversification is one of the easiest ways to limit risk and volatility in your portfolio. When the stock market is not doing well like in 2022 so far, diversifying protects you because you are invested in a range of assets. This will help alleviate losses and maximize long-term returns.

Do not chase leads: The news and internet are full of stock tips and the next thing that is going to blow up. Sometimes they can be viable, but do not blindly follow them. Do your own research and make a decision that’s best for your portfolio.

The post Investing for the first time in 2022 appeared first on Wall Street Survivor.

The day of having a person as a financial advisor may be slowly going away. Investing successfully takes a lot of research and effort. Once you have invested, you have to monitor and adjust your portfolio constantly.

Not everyone has the time or knowledge to do so. A financial advisor can do all that for you, but they are very expensive. A robo-advisor is a solution to that issue. A robo-advisor is coming more popular in this new world where technology is the answer to all our issues.

What is a Robo-Advisor?

Robo-advisors, also known as automated investing services, use computer algorithms to manage your portfolio. Automated investing is a straightforward, and low-cost way to invest without human intervention.

Typical a robo-advisor asks about your financial goals, risk tolerance, and financial resources. Based on these results, it will make investment decisions and monitor your portfolio. Many services offer a robo-advisor like Charles Schwab and Fidelity.

Understanding a Robo-Advisor

The first robo-advisor was launched in 2008 with the purpose of rebalancing assets within target-date funds. Portfolio allocation software has been around since the early 2000s, but now the technology is evolving.

A robo-advisor is computer software that uses algorithms to predict investors’ preferences and risks. They will ask you a set of psychographic questions and then model a portfolio. These questions will ask about your income, liabilities, asset allocation, and willingness to take risks.

The robo-advisor takes your results and runs them through an algorithm. This will create your investment strategy and construct a diversified portfolio.

Once funds are added, the robo-advisor will automatically adjust your portfolio to meet your goals.

Benefits

One benefit is that they are a low-cost alternative to a human finial advisor. By getting rid of humans, they do not have to charge as much, and they are available all the time. You only need the internet to access a robo-advisor. Robo-advisors take less capital to get started with. This makes them more accessible to a larger demographic of people.  

Being more accessible makes them more efficient. It only takes one click of a button to make a trade with a robo-advisor. For a traditional advisor, you have to meet with them and wait for them to physically execute the trade.  

With traditional financial advisors, biases do play a role in their decision-making. No matter how experienced you are as an advisor, you are human, and we all have biases towards certain investments.

Robo-advisors take all bias off the table. It uses algorithms to evaluate and make bias-free decisions. The computer aspect takes the human instinct out of it to make rational and neutral investments.

Not only can a robo-advisor manage your portfolio, but it can manage your whole financial planning. It can assist in your plans for retirement and make sure you are taking advantage of all taxes. It is an all-in-one service that helps you reach your financial goals while taking on as few liabilities as possible.

Disadvantages

The differences in technology between some robo-advisors is a negative aspect. Some use AI to learn your preferences while some are far behind in their software.

There is a lack of customization with some robo-advisors. They are designed for people similar to you, not you specifically. They will offer you a variety of plans to choose from based on your profile. Many times, you have to go along with the plan already created and do not have any decisions in assets for yourself.

Taking out human bias is potentially a good thing, but traditional advisors are there to manage emotions as well. When the market is not doing well, a robo-advisor cannot tell you what the future will look like or not to panic. It can only adjust your portfolio accordingly.

A human advisor can give you the reassurance that everything will be okay and their strategy going forward. Nothing is stopping you from selling everything during times of turmoil with a robo-advisor.

Costs?

Robo-advisors are significantly cheaper than an actual human financial advisor. They typically charge a management fee normally between .25% to .50% based on assets under management.

Human financial advisors normally charge over 1% of assets under management. For example, with a robo-advisor, if you have a $10,000 portfolio, you may pay up to $50 in fees.  

With a standard brokerage account, you sometimes have to pay commission fees when you buy or sell assets. Robo-advisors normally waive these fees.

Future

Robo-advisors are aiding in the gap between financial services and everyday people. They have made financial planning more affordable to everyone, not just the wealthy.

The industry is not too sold on the idea of having a fully computer-based advisor. They believe the technology is not ready and human interaction is extremely important.

They are quality tools for new investors and those with smaller accounts.

According to Statista, current client assets under robo-advisor management are at $987,494 m this year. The robo assets under management are expected to grow at a 26% annual rate between 2020 and 2024.

There is a lot of potential here with robo-advisors. Just have to wait and see how they evolve next.

The post What is a Robo-Advisor? appeared first on Wall Street Survivor.

Over the past few years, cryptocurrencies have become the new hot commodity to buy and sell. Everyone likes to talk about what Bitcoin is doing. 

With the increased popularity, investing in crypto has become easy and user-friendly. Platforms like eToro and Coinbase have established themselves as some of the top crypto exchanges, providing access to a large variety of cryptocurrencies.

Below, we will compare eToro and Coinbase to help you decide which is the better platform for you. We will look at the pros and cons of each, what makes them special, and the costs. By the end hopefully one fits your investing strategy. 

What are they? 

eToro is a company based in Tel-Aviv, Israel, and was founded in 2007. Their current CEO is Yoni Assia. 

eToro is a social trading platform that enables you to buy cryptocurrency, stocks, and ETFs. It also allows you to keep up with the investing strategies of other eToro users.

The company started off as a crypto exchange only, however, has evolved into a multi-asset broker. eToro was actually one of the early adopters of cryptocurrency exchange. 

Social investing allows investors to share ideas and on eToro, you can copy other portfolios and strategies. 

eToro is supported in more than 150 countries and 45 states. Investors in Tennessee, Hawaii, Minnesota, Nevada, or New York, unfortunately, do not have access to eToro. It currently has over 25 million registered users. 

eToro offers many features, but it mainly includes trading different equities, following top traders' portfolios, and trading virtual currency for practice. 

Coinbase is a crypto-only exchange based in the United States founded in 2012. It went public on the NASDAQ stock exchange in 2021. 

Coinbase is a very user-friendly platform to buy and sell cryptos. Their focus is to make trading simple. Besides buying and selling crypto, reading-related news, or checking charts there is not that much more offered by Coinbase. 

Coinbase is the largest crypto exchange by trading volume in the United States. It is accessible in over 100 countries and 49 U.S. states – Coinbase is not supported in Hawaii. 

eToro vs Coinbase: Features

One of the prominent differences between eToro and Coinbase is how many cryptos are available to trade. 

Coinbase offers over 120 tradable currencies which includes the majority of the top 30 largest by market cap. 

Unique to Coinbase is the ability to borrow cash using crypto and earn interest by loaning out your cryptos. 

eToro only offers over 60 cryptocurrencies. For international users, stocks, ETFs, and other securities are available to trade as well. 

Both exchanges update their cryptocurrency list with new currencies. 

One feature they both share is they offer a digital wallet. A wallet is so investors have a secure place to store their assets. Both wallets are the same concept but are different in a few ways. 

You do not have to be a Coinbase user to open a Coinbase Wallet. eToro is the opposite, you have to be a user to access the wallet. 

Coinbase allows the transfer of money between the wallet and crypto exchange. On eToro, it is a one-way road, once cryptos are transferred to the wallet, they cannot be moved back.

eToro charges a .5% to transfer to the wallet and Coinbase does not.

Only a handful of currencies are supported on eToro's wallet whereas Coinbase supports more. 

The features that distinguish eToro over Coinbase are their social community, copy trading, and demo accounts. 

There is a forum that allows users to follow each other and start posts. This is a great opportunity to share investment strategies and maybe learn something new. 

eToro also shares what percentage of its users are buying or selling a specific crypto. 

Their CopyTrading encourages users to duplicate what experience and successful traders have done. Real-time trades are made public so others can follow. 

Copying one's entire portfolio is an option also on eToro. 

Demo Accounts are a great way to learn and gain experience trading crypto with zero consequences. eToro starts you with $100,000 to gain practice and have some fund-making trades. Coinbase does not offer any of these features. 

Coinbase's main features are an active watchlist, real-time news of the industry, and the ability to earn crypto by watching videos.

Fees

In this world, to make money, you have to spend money. Fees can easily add up and can be hard to keep track of. Fortunately, eToro is one of the more affordable crypto exchanges in the United States. 

There is no commission fee, investors pay a 1% fee to buy or sell crypto. The 1% is calculated for both the open and close of the position. This fee is calculated at the time you open the position and is added to the market price. 

eToro does not charge based on what payment method is used to fund your account.

eToro has a minimum deposit of $10. For wire transfers, the minimum is $500. 

If you're using the eToro Money Wallet for your crypto, you'll also pay a 0.1% conversion fee to convert one coin to another.

There's also a 0.5% transfer fee (minimum of $1, maximum of $50) when you transfer funds from your eToro brokerage account to the Money wallet.

eToro also charges miscellaneous fees for certain optional services.

You'll also pay different fees for paper services, wire transfers, and other services.

If you are an inactive eToro user for more than 12 months, they will charge you a $10 monthly fee. International users pay $5 to withdraw funds. 

Coinbase fees are more expensive and more complicated. When you make a trade-in 

Coinbase, there are 2 fees. 

The first fee you are charged with depends on the value of the transaction and it ranges from $0.99 to $2.99. 

The next fee is a percentage based that ranges from 1.49% to 3.99% depending on the payment method used. 

On Coinbase, the fees shrink as trade size increases. Coinbase does not charge a withdrawal fee. It also does not cost anything to add funds to the wallet, but most deposits do have fees. 

To buy and sell crypto on Coinbase, all you need is $2 in your account. This makes Coinbase pretty attractive for investors. 

User Experience

The reason both eToro and Coinbase are so popular is how easy it is to operate these platforms. 

Coinbase is known for being a crypto exchange for beginners. It offers educational tools for novice investors and an online support portal. Users can watch short videos to earn a stake in crypto. 

Coinbase's interface makes it straightforward to buy or sell crypto.  The only downside is it offers limited transaction types. 

When opening up Coin base online or with the app, the dashboard will show gainers, losers, and the most volatile crypto that day. There are color-coded charts that show the performance of that crypto in real-time or in the past. 

Any cryptocurrencies added to your watch list will be tracked too. Coinbase also provides news in the crypto world to keep you up to date. 

eToro is more for investors who have some knowledge of trading crypto. They offer more transaction types than Coinbase. 

eToro is limited in terms of educational opportunities offered, but they do have a basic help center. 

One key difference is that eToro has a community chat where questions can be asked, and ideas can be shared. 

On eToro, it has a customized dashboard. It shows the biggest movers of the day and what are the most popular cryptos among other investors. 

It also has a watchlist that shows a color-coded chart to easily keep track of your cryptos. 

For most cryptocurrencies, eToro gives a rating of buy, sell, or hold based on technical indicators. 

Both options make the process of trading crypto very manageable. Just select the crypto you want to trade, enter how much you want to purchase, select the trade type, and submit. 

Both apps are clean and work smoothly. They receive pretty decent reviews from users. 

Security and Reputation

eToro and Coinbase are reputable and secure services. Both have years in the world of investing and have millions of users who trust both platforms with their hard-earned money. But everyone wonders if they are legit, and can be trusted? 

eToro is regulated by the United Kingdom's Financial Conduct Authority (FCA). It is also a member of the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). 

This means that eToro is regulated by the government, like many other trusted financial services. 

All user funds are kept in tier 1 banks and cash deposits are insured by the FDIC for up to $250,000. 

eToro also complies with the Cyprus Securities and Exchange Commission (CySEC) and the 

Australian Securities and Investment Commission (ASIC). 

Coinbase is regulated in the United States as well by the United Kingdom's FCA. All client funds are kept in United States banks and cash deposits are FDIC insured for up to $250,000. 

Cryptocurrencies that are stored online on Coinbase's exchange are insured. Coinbase stores over 98% of deposits offline in cold storage facilities that are monitored 24/7. 

Both eToro and Coinbase have multi-factor authentication to secure your account. They also conduct bug bounty programs so ethical hackers can find any holes in the system.

Millions of people have safely traded trillions of dollars worth of crypto on both of these services. So, the answer to the question is yes! eToro and Coinbase can be trusted with your money. 

Final Verdict 

Coinbase and eToro are both quality options to trade cryptocurrencies. They have their advantages; it just depends on your preference. 

Coinbase

• Straightforward
• Everything you need in one place,
• Offers a wide variety of currencies
• High fees

eToro

• More advanced
• Lower fees, social trading
• Demo accounts
• Limited currencies to trade

Explore both options and do your research. To take a deeper dive into eToro click here.

If you are just getting started with crypto and want to learn more, check out our in-depth article on Cryptocurrency. 

The post eToro vs Coinbase appeared first on Wall Street Survivor.

Seeking Alpha vs Zacks: what do these two titans of stock research and analysis have in common, what makes them different, and most importantly, which one is right for you?

Seeking Alpha and Zacks are research and analysis tools for investors who pick their own stocks.

Both are famous for their stock ratings – millions of people across the world pay to have access to their “strong-buy” stocks and know to avoid their “strong sell” stocks like the plague.

Both use expert analysts' research and analysis to derive information about investments. Their goal is to provide investors with tools to learn and build their own portfolios. 

They are similar in many ways, but the main difference is their approach to researching and presenting stock data. This article should help you decide which service fits your investing style better – Seeking Alpha or Zacks?

Seeking Alpha vs Zacks: How They Started

Zacks

Zacks was started by Len Zacks in 1978, a Ph.D. from MIT. 

Len was obsessed with analyzing Wall Street Analysts and wanted to build his own team of in-house analysts.

His vision was to create a team who could rate stocks, then provide productized ranks and lists for investors to analyze and build their portfolios. 

Zacks believes that earnings estimate revisions are the most powerful factor to drive stock prices.

Basically, when financial analysts change how much a company will earn in a quarter, that can change stock prices more than anything else. 

Seeking Alpha

Seeking Alpha was started in 2004 by financial analyst David Jackson. The original plan was to create a research platform where passionate investors can share their own stock analysis with a community. 

A big component of Seeking Alpha is this unique idea of crowdsourcing investing. Sharing knowledge with a community and all supplying, refining research, insights, and opinions. 

Instead of having its own analysts, Seeking Alpha uses Wall Street analysts, fund managers, and other reputable market watchers. 

They do have in-house editors who cover current market news and review articles submitted to their forum. 

Seeking Alpha vs Zacks: Rating Stocks

Each of these platforms provides a list of stocks that are rated to get an idea of what to research. All these lists and ratings are done by respected analysts.

The main reason to use either of these services is to find stock ideas to research for yourself. 

Zacks has a very straightforward rating system. In the areas of value, growth, and momentum, stocks are given a ranking of A through F. Equities are also given a rank of 1 (strong buy) to 5 (strong sell).

The Zacks #1 list shows you the top 5% of stocks with the most potential. There are stock screens that allow you to pick stocks based on your investing strategy. 

Zacks uses quantitative analysis to rate and rank stocks. This algorithm gives Zacks objective 

information to find the best stocks. 

Zacks' rankings have done very well against the S&P 500. 

Over the past 34 years, stocks that Zacks rank as a “#1 Strong Buy” have outperformed the S&P 500 by an average of 13.9% each year. Zacks has proven that its system works and why so many investors use its analysis. 

Zacks now provides rankings for ETFs, mutual funds, and other equities. 

Seeking Alpha has a top-rated stocks list as well, compiling of 50-75 stocks that earn strong buy scores. Scores are broken up and determined by Seeking Alpha contributors, Wall Street analysts, and Seeking Alpha's quantitative algorithm. Any stock with a rating above a 4.5 is rated a very bullish buy. 

Beside the analyst's score, each stock is also given a letter grade for valuation, growth, profitability, and momentum. These ratings provide investors with a very easy way to get stock ideas. 

Seeking Alpha has also done extremely well compared to the S&P 500 since 2010. Seeking Alpha's “Very Bullish” rated stocks based on Quant Performance, have returned an average of 28% per year.

That's 4x the average return of the S&P 500!!

Their quantitative analysis is slightly more successful compared to the market than Zacks.

In this new world of alternative equities, Seeking Alpha offers analysis and updates on crypto, forex, and commodities.  

Seeking Alpha vs Zacks: Stock Research

Seeking Alpha and Zacks provides stock research that is detailed and reputable. 

Zacks is the better option if you want a traditional stock research report – a single report that's relatively easy to read and presents a professional analyst's view of a company they've been following for many years. 

Each report contains a deep dive into the company and a look at its fundamentals and growth potential. They offer an in-depth report for every stock they cover. 

Another major feature of Zacks is their stock screener. It allows investors to filter and search for companies based on the return of investment, price changes, earnings per share, or your own investment style. 

Zacks also offers interactive charts that show a stock's reaction to earning reports and other fundamental data. 

Seeking Alpha is the better platform if you want a diversity of viewpoints, analysis methods, and opinions. 

Reading through several analysis articles takes more time than reading a single research report, but advanced investors can dive deeper into both the bull and bear cases for a stock. 

This gives investors more tools to decide their strategy and grow their portfolio. 

Seeking Alpha provides a stock screener that enables you to sort and search by financial ratios, analyst ratings, profitability, and many other fundamental and technical configurations. 

Other Features

Both have education centers 

• Zacks offers videos and courses on investment strategies. Zacks also has a complete guide on understanding the power of earnings estimates. 
• Seeking Alpha offers numerous articles about the world of investing, portfolio management, and their quant ratings. If you are not much of a reader, they have investing podcasts and videos as well. 

Seeking Alpha has news, and editors report on live coverage. It is a nice feature to have updated news on the stock market world and research your next stock pick all in one place. 

Zacks provides an earnings calendar. It tells you which companies are releasing their earnings that specific day and what time of day they come out – before the market opens or after it closes. 

Once the earnings report is released, it compares Zacks' estimate to the actual results and the price change. 

Each platform has a portfolio tracker. At Zacks, you will see their rankings of all the equities currently held and receive daily email notifications on the performance of your portfolio. 

Same thing for Seeking Alpha, up-to-date notifications of your portfolio's health. 

Seeking Alpha vs Zacks: How Much do They Cost?

Both have a free version.

But, they each keep their most sought-after features behind the paywall.

You can see Wall Street analyst ratings with Seeking Alpha, but to access their quant ratings and top-rated quant list, you have to have a Seeking Alpha premium account.

Zacks has free ranked lists, for your email address. You can see what Zacks ranks stocks for free, but to get the Zacks #1 Stock List you have to be a premium member.

Zacks Premium $249, $20.75/month, 30-day free trial.

Seeking Alpha Premium, $240, $19.99/month, 14-day free trial. 

Each has subscriptions greater than the premium that comes with more features but costs a significant amount more. 

My Experience with Seeking Alpha vs Zacks

Zacks

I like the lists they send via email, but don't think I would ever browse the site.

The earnings calendar is helpful to keep up to date. 

Seeking Alpha

I like the site and the platform, the customization of how I can look at the analysis. I've also found myself casually logging in to read interesting articles, news stories, and keep tabs in real-time on my portfolio. It really feels like a “one-stop shop” for all my investing analysis needs. 

Seeking Alpha vs Zacks: Bottom Line

Here's the bottom line:

They use different methodologies

Seeking Alpha

• Newer
• More tech, data, and AI-focused
• Crowdsourced analysts' opinions

Zacks

• Older
• Focuses on more curation (ranked lists)
• In house analysts

Seeking Alpha and Zacks offer a service to help investors find successful stocks. Their research and analysis are conducted by professionals. Their selections are proven and have outperformed the market. Both are great platforms, just depends on your preferences. 

So which type of investor are you? How do you prefer to learn about your portfolio and analyze future investments?

It's worth trying one or both, ESPECIALLY since they both have amazing, all-access free trials.

Get Seeking Alpha Premium FREE for 14 Days

Get Zacks Premium FREE for 30 Days

To learn more about each one, click here for our review of Zacks and click here for our review of Seeking Alpha. 

The post Seeking Alpha vs Zacks appeared first on Wall Street Survivor.

If you haven't heard of the Morning Brew by now, where have you been?!

Just kidding; but we do want to fill you in if you aren't already in-the-know.

Today we will be reviewing the Morning Brew, one of the most popular daily email newsletters out there.

What is the Morning Brew?

The Morning Brew is a New York City-based media company that made its name by starting a free, self-named email newsletter that gets delivered to your inbox every morning before work. Since then, the Brew has launched new newsletters as well as podcasts.

The Morning Brew was co founded by Alex Lieberman and Austin Rief in 2015 at the University of Michigan. It now has over 4 million subscribers and about 100 employees. 

What's In the Newsletter?

These are some of the sections you'll see in every Morning Brew email.

Markets

The Markets section appears at the top of every Morning Brew email. This section shows you how the three major stock indices, the 10-year U.S. Treasury yield, and Bitcoin performed for the past day. You’ll also see the performance of a popular company or commodity at the bottom of this section – this one changes every day. 

Under the daily gain and loss report, you’ll see a summary of what happened overall in the market. There will also be a short commentary on why it happened or how it’s affecting other parts of the economy. 

World

The World section includes headlines regarding geopolitical issues or stories from the U.S. with global implications. This section might give an update on a major world conflict, break the news on a move made by a large multinational corporation, or talk about what the world’s political leaders are doing.

Grab Bag (Key Performance Indicators)

The Grab Bag is one of our favorite sections. This section gives you quick links to and short descriptions of three different stories, organized by:

Stat: An interesting statistic like the number of fans at a recent sporting event or an uptick in streaming of a particular song or artist.

Quote: A recent sound byte (usually from someone famous) and why it was said.

Read: A catchy headline with a link to an interesting story.

Brew’s Bets

This section contains an assortment of recommendations from the Morning Brew team. The recommendations might be for a documentary, a comedy special, a new product, or a piece of life advice.

Some of these recommendations are paid advertisements from Morning Brew’s partners, while others are simply products or entertainment that the team finds interesting.

What Else is Brewing

The What Else is Brewing section gives you some other stories to check out if you decide you’re not done reading the news yet. Rather than reserving an entire section for one story, What Else is Brewing just lists a few headlines and gives a brief description of each story. These stories are usually smaller or more random than their counterparts that appear earlier in the email. 

From the Crew

Sometimes you’ll see a section called From the Crew at the bottom of the newsletter. This is the Morning Brew’s place to advertise some of their other products and events. Here you can find links to the Brew’s other newsletters, podcasts, and even special events like the Leadership Accelerator virtual cohort.

Games

At the bottom of every Morning Brew email, you’ll see a game or two that you can play to round out your reading experience. The games range in type and difficulty; there have been crossword puzzles, spelling bees, word games, and more. Our favorite Morning Brew game is one where they list several headlines and ask you to guess which one is fake – we’ve seen some crazy headlines!

Other Sections

The sections listed above are the sections you’ll see in just about every email. But it doesn’t end there! Several sections of every email rotate every day. You’ll see sections like:

Crypto: an update on the world of cryptocurrency, including spikes, drops, and news.

Economy: news on key indicators and predictors as well as the overall state of the economy.

Labor: headlines on joblessness, shortages, or jumps in applications for a particular industry.

Health: what’s going on in the medical field as well as updates on drug and pharmaceutical laws.

Education: Which schools around the world are performing well and what moves they’re making.

Art: Sale prices and important stories in the world of the arts.

Entertainment: What’s going on in the lives of celebrities, plus updates on new movies, TV shows, and the like.

Work: Interesting reports on salaries and what industries are hot.

Calendar: Holidays, traditions, and upcoming events.

You’ll also see ads from some of the Morning Brew’s partners scattered throughout each newsletter. When you click on these links or buy the products, Morning Brew will earn a commission. The company is very good about letting the reader know when a section of the email is an ad; you’ll see a headline such as “Sponsored” or “Together With…”

Other Products

The Morning Brew newsletter isn't the Brew's only product on the market. They also offer a selection of other email newsletters and podcasts.

Newsletters

Money Scoop: Money Scoop comes out three times a week. It contains reports on the economy, investing updates, and tips on things like personal finance and Excel skills.

Sidekick: Side hustle tips, career advice, and updates on what jobs are raking in the cash.

Money with Katie: This weekly email contains personal finance advice, budgeting tips, and tax strategies. 

Podcasts:

Business Casual: Business Casual comes out twice a week. Each episode is a conversation between the hosts (Nora Ali and Scott Rogowski) and an entrepreneur or business expert.

The Money with Katie Show: This podcast, along with Katie’s newsletter, is filled with finance and tax tips.

Founder’s Journal: The Founder’s Journal is Alex Lieberman’s very own “audio diary” where he gives tips for building and maintaining your own business.

Imposters: This is another podcast from Alex Lieberman. Every episode is an interview with Alex and a big name in business, entertainment, or sports.

How Does the Morning Brew Make Money?

The Morning Brew makes most of its money through ads. They also sell merch which you can buy on their website.

Is the Morning Brew Worth It?

Well, the Brew is 100% FREE for subscribers. So yes – the Morning Brew is worth it!

I suppose the better question is: is the Morning Brew worth your time?

And again, our answer is a resounding yes; the Morning Brew is a great use of a couple minutes of your time every morning.

We at Wall Street Survivor have been reading the Brew for years, and we’re much better for it. It keeps us up to date on the going-ons of the world!

Final Thoughts

If you've been wanting to stay up to date on politics, the economy, or random news, there's no better time to start than right now.

The Morning Brew is the best place to get your daily dose of news, and it only takes a few minutes a day!

The post Morning Brew Review appeared first on Wall Street Survivor.

The Motley Fool's Epic Bundle is one of the Motley Fool's newest stock recommendations services.

Actually, it's not really a new service but rather a combination of 3 of their existing services. It includes their 2 most popular services, Stock Advisor and Rule Breakers, and their newest service, Everlasting Stocks.

It currently retails for $499 per year.

Is the Motley Fool Epic Bundle Worth It?

At first I was skeptical, and then the more I researched it, I became a convinced it was a good deal, and I subscribed.  With the Epic Bundle you are getting $797 worth of their newsletters for $499.  That saves you $298 each and every year on the renewal.  Stock Advisor is normally $199/yr, Rule Breakers $299/yr, and Everlasting Stocks is $299/yr.

You might be able to find a promotion link to get Stock Advisor at a discount for the first year for new subscribers, but if you let it renew for the second year, it will be “at the then current rate.”  So the Epic Bundle definitely saves you money because it is much cheaper in year 2 and thereafter.  If you can invest at least $1,000 in the market each month, then the $499 is a small price to pay to get stock picks that historically have outperformed the SP500.  Remember, to be successful investing in the stock market you must be thinking long term (at least 5 years), you should invest monthly so that you are always buying (dollar cost average principle), and your goal is to outperform the SP500.

And when you subscribe to the Epic Bundle, each month you will get 6 new stock picks and 15 timely re-recommendations of previous stock picks.  You also get immediate access to each of the 3 services' historical picks.

What is the Epic Bundle?

Here is a quick review of the 3 services you get immediate access to when you subscribe to the Epic Bundle:

1. Stock Advisor: 

Stock Advisor is the Motley Fool's original newsletter going back to April, 2002.  It is the combined efforts of the Motley Fool founders, brothers Tom and David Gardner.  Every month they each pick one new stock and give a list of their top 5 favorite stocks.  So that is essentially 2 new stock picks a month and re-recommendations of 10 of their current favorite stocks from previous picks.  This is their most popular service as it has over 1,000,000 subscribers. 

Mostly importantly, the average return of all of Stock Adivsor's stock picks from this service is 356% compared to the SP500's 124% (20 years).

2.  Rule Breakers 

Rule Breakers was launched in December, 2004.  This is specifically just David Gardner and his team's picks.  They target high growth companies in high growth industries.  What this means is that it might take a year or so for these stocks to take off.  And when they do take off, they really take off.  But what it also means is they pick a few losers each year.  David Gardner's teams

Mostly importantly, the average return of all of Rule Breakers stock picks from this service is 205% compared to the SP500's 106% (18 years).

3. Everlasting Stocks 

The Motley Fool Everlasting Stocks service was launched in October 2018.  This service is managed by Tom Gardner, one of the 2 brothers that founded the Motley Fool.  Second on the team is the Motley Fool's Chief Investment Officer Andy Cross.

One unique feature of Everlasting stocks is the ranking they provide monthly of their picks.  As they say:

Everlasting Stocks is designed to beat the market over 5 years with companies that represent Tom Gardner's Everlasting principles. Our Top 10 Rankings each month highlight those that we believe are the most timely to beat the market and attractive for new money or additional capital. Just because a company isn't on the list doesn't necessarily mean we've lost confidence in it. We just 
prefer these to consider first.

Here's a little peak of their May 2022 Top 10 Rankings.  I am just showing the top 5 as the I don't want to get in trouble from the Fool!

Is the Motley Fool Epic Bundle Legit?

I get asked this question alot.  The Motley Fool Epic Bundle is absolutely legit.  The Motley Fool is a very reliable company.  I know many of their team members and they are very active presenting at financial education conferences around the country.  Their customer service is also perfect, offering both a phone number and email support during market hours.  Bottom line, if you are looking to make you life a little easier and can invest at least a few hundred dollars in the market each month, and plan on keeping the money invested for at least 5 years, you should try it.

To learn more, or to sign up for the Epic Bundle, use this landing page to get their lowest price.

The post Motley Fool Epic Bundle Review: Is it Worth It? appeared first on Wall Street Survivor.

The Concept

Let's say you bought a birthday cake for 10 people. However, more people showed up than expected, so you have to cut more than 10 slices. It is still the same amount of cake, no matter how many slices you cut it into. 

Same concept for a stock split. The board of directors will issue more shares of stock to shareholders without diluting their investment.  

For example, say you own 1 share worth $100. If the company opts for a 2-1 stock split, you will have 2 shares worth $50 each.

A stock split increases the number of shares outstanding, lowers the share price, and the company's market cap does not change. The most common stock split ratios are 2-1 and 3-1. 

Why do stock splits happen?

Companies decide to split their stock when the share price gets too high. That may seem counterintuitive, but it makes it seem more affordable for investors.

After the split, the price per share will be lower which will entice others to invest. Not everyone can afford a $300 stock, but if the price is $100, that makes it more attainable for more people.

Stock splits also create more trading liquidity for a company which is a good thing.

Another reason for a split is if other stocks in the sector are trading well below your price. The other stocks are not always a better value, but investors do make that assumption. 

Impact

If you are a current shareholder of a company and they decide to split, it does not create an advantage for you.

It does not change your initial stake in the company; it will only increase the number of shares you own. Stock splits just try to reel in more outside investors.

A company will announce a stock split to lower the price per share. The hope is that with a split, it will result in an increase in share price and increase in company value.

More people can buy, you see demand rising, and the price may go up.

When a split is announced, it is good news to hear for an investor. The announcement signals to the market that the company is growing and investors hope it continues to. 

Dividends paid by the company are usually adjusted proportionately to the stock split ratio, so the total amount received does not change. 

Stock Split Studies

The question with stock splits is, are they beneficial to the stock or not? We will take a look at some studies done in the past to answer this question. 

One of the first studies on stock splits was done in the 1960s by economist Eugene Fama – founder of the efficient markets theory. Fama found that in the long run, the performance of a stock is no different after a split. 

David Ikenberry, Chairman of the Finance Department at the University of Illinois, did a study in 2003 examining the price effect of stock splits.

Ikenberry compared companies that split to similar companies that did not split. He chose 1000 companies from 1990 to 1997 and included 2-1, 3-1, and 4-1 splits.

The results showed that the split stocks on average outperformed the market by 8% the following year and 12% over the next three years. 

There have been more studies done in the past, but experts still have different opinions.

In the short term, a stock split might be bullish due to the increase in volatility. Looking down the line, a stock that split should eventually fall back in line with the market. 

Current Stock Splits 

Alphabet (GOOGL), which is the parent company of Google, announced back in February there will be a 20-1 stock split on July 15.

Google shares have returned around 150% over the past 5 years; compared to the S&P 500 return of 80%. Google has the growth momentum to support a stock split.

Google trades around $2,207 (based on the most recent close) a share and with the split, it would trade around $110 a share. This would make Google significantly more affordable for retail investors and ideally create a bullish run.

Amazon (AMZN) also announced they will be doing a 20-1 stock split effective June 3. This would be its first stock split since 1999.

Even though Amazon has had historic growth over the past twenty years, returns have underperformed the S&P 500 over the past three years.

They are hoping this split will bring new volume to the stock. Amazon shares would go from roughly $2,146 (most recent close) to around $107 – again more affordable for investors. 

Back in August of 2020, Apple (AAPL) conducted a 4-1 stock split. Their share price decreased about 75% after the split.

Before the 2020 split, Apple had split four times since going public. Apple has had a history of short-term sell-offs post splits. Apple shares have lost an average of 5.6%, two weeks after a split. 

Source: Kensho

Tesla (TSLA) announced a 5-1 stock split in August of 2020. Their shares rose 80% over three weeks from just the announcement!

The pre-split price was around $2,213 and after the split, it was around $498.

The chart below shows the momentum after the announcement, but there is a drop once the split is effective. 

Source: MarketWatch

Conclusion

Whether Stock Splits are a good thing or not just depends on the company.

A stock split is a sign that a company is excelling in terms of price and earnings growth.

If you are a believer in a company, a stock split is a golden opportunity to buy shares at a lower price. 

The most famous case of a company that will not split is Warren Buffet's company, Berkshire Hathaway.

Their Class A stock currently trades at around $456,000 a share. Buffet says that he would rather focus on long-term gains, rather than temporary success. 

The post What are Stock Splits appeared first on Wall Street Survivor.

A recession has been a very popular word over the past couple years with the coronavirus pandemic going on and with Russia’s invasion of Ukraine.

Last Quarter (Q1), Gross Domestic Product (GDP) declined by 1.4 percent. If the current quarter (Q2) has a negative GDP, we will technically be in a recession. We will not know until Q2 is over and the numbers are announced. 

These current events have led to shaky times in the economy, but we will show you in this article how to still be successful through some recession stocks. 

What is a Recession?

A recession is a decline in economic growth (GDP) for two or more quarters – half a year.

Typically, during a recession, there is a significant drop in the stock market; the housing market is unstable, and there is a rise in unemployment. 

The National Bureau of Economic Research (NBER) is the one who officially declares recessions in the United States. Their definition is a little different than the general public’s opinion.

They say a recession is a strong decline in economic activity that is spread across the economy that lasts a few months. NBER looks at real income, employment, industrial production, and wholesale-retail sales. 

Causes and Effects?

A recession has many causes but let us take a look at three major influencers. 

Economic Shock – An event that occurs spontaneously that creates financial havoc on the economy. In February of 2020, the NBER declared a recession in the US, due to economic shocks in the supply chain caused by the Coronavirus. 

High Inflation – Inflation is what causes prices to rise over time. Too much inflation is a bad thing and the Federal Reserve will raise interest rates to combat it.

Raising interest rates reduces the amount of money people can borrow, which leads to a decline in economic activity. High inflation led to the recession of the early 1980s. 

Large amounts of debt – Taking on too much debt is risky because it can lead to defaults and bankruptcies. The Great Recession of 2008 is an example of excessive debt causing a housing market bubble which crashed the entire economy. 

How does a recession affect me?

Potential Job Loss: As the economy shrinks, companies tighten their budgets and reduce overhead as a reaction to less demand for their products and services.

Job security decreases, so it's important to communicate with your team and managers about your role and its value preceding a recession.

Investments Loss (stocks, real estate, retirement savings): With every recession, your investments tend to get pretty hard. It can be easy to freak out and panic sell. You want to stick to your investing strategy and focus long term. 

Prices rise (food, gas, clothes, etc.): One of the main reasons that we go into a recession is because of high inflation.

Inflation causes prices to rise, so you should budget accordingly. Figure out your day-to-day necessities and cut out luxury items to save money. 

Historical Trends 

What Stock Sectors did well during past Recessions? 

During a recession, the stock market becomes very hectic. The overall stock market tends to get hit, and some stock sectors do worse than others depending on the recession.

However, through all the smoke, there are some stock market sectors that are recession-resistant. The industry calls these “Defensive Sectors”.

Health Care:

Health care tends to be a safe investment during a recession. Within this sector, there are companies in pharmaceutical, health care equipment, biotech, and health care services.

The reason for health care outperforming others is that we buy health care products all the time and purchase them repeatedly. Some of these products include drugs, medical equipment, hospital supplies, and health insurance.

For example, if you are sick, you go to the doctor, and then go to the pharmacy to pick up your medicine.

Health care companies that have high debt and low cash flow tend to get hurt more during a recession. To be safe, look into health care companies with low debt-to-equity ratios and avoid startups. 

Consumer Staples:

Consumer staples is another sector that has outperformed during a recession. These products are always in demand because they are items people use every day. Such as, food, drink, personal products, and household goods.

Companies in this sector are doing business all the time regardless of the state of the economy.

In the chart below, Consumer Staples does its best, when a recession is approaching. 

Utilities: 

The common theme between these three sectors is that consumers always demand these goods and services. Same thing for Utilities – water, electricity, and gas.

Some other companies within this sector are renewable energy and infrastructure (pipelines, cell towers, power lines, etc.) providers. Again, people will always need to pay their bills.  

During a recession inflation rises, which causes prices to rise. People will have to budget properly to save money during tough economic times. They might have to give up luxury items, but they will have to pay utility bills, medical expenses, and will have to eat. 

Investments to avoid during a recession

Avoid companies with a lot of debt on the balance sheet. This means they are more sensitive to high interest rates that come with a recession.

Investors will mark down stock prices to reflect the risk from having so much debt.

Typically during a recession, a business will suffer a decline in sales, and may not be able to pay interest on its debt. This can lead to default or bankruptcy. 

History has shown us that stocks in the financial sector do poorly during recessions. During the great recession of 2008, the financial sector was ravaged by the crash of the housing market.

Two victims of this financial crisis were Lehman Brothers and Bear Sterns – both considered “pillars” of Wall Street. Bear Stearns was bought out by JPMorgan Chase for very cheap, and Lehman Brothers filed for the largest bankruptcy in the United States at the time. 

The recession during the coronavirus pandemic hit some different sectors than previous recessions. The industries heavily impacted were Airlines, Hospitality, and Entertainment.

In April of 2019, more than 2 million travelers passed through United States airports every day. During the 2020 recession, air travel fell by 95% because of the pandemic. Cruise lines, sporting events, and casinos also had a drastic drop in attendance numbers. 

Portfolio Strategy 

There are several factors to consider to prepare your portfolio against a recession.

One of the best ways is to have a diversified portfolio. This means including stocks in the Health Care, Utilities, and Consumer Staples sectors. But also make sure your portfolio is dipping into industries all across the board.

Defensive sector stocks do tend to outperform during recessions; nevertheless they typically have lower growth rates during the recovery phase. That is why also investing in stocks with potentially higher growth rates like tech is a good idea. 

An ideal company during a recession has the following characteristics:

– Low debt

– Profitable

– Strong balance sheet

– Positive cash flow

– Strong demand for their products

Bottom Line is you want to keep a long-term mindset and manage your risk as much as possible. A recession is only for a relatively short period of time, on average 11 months, so you should have an active investing strategy when the positive times return. 

One final way to tackle a recession is to stop spending and build up capital to invest.

The stock market fluctuates all the time; you just have to stay disciplined and know eventually it will recover. If you believe in your investments, one thing you do not want to do is sell when they are at its lowest point.

When you think about it, that company is just “on sale” and a recession is a great time to buy more. That should be the case if the company has strong leadership, solid financials/books, and an optimistic plan for the future. 

Expert Opinions on Recession Stocks:

Let’s take a look at two famous, but different in strategy investors and how they handle a recession. 

Warren Buffett:

Warren Buffett could be considered the poster boy for stock market investing. He is known for his value investing strategy and being the CEO of Berkshire Hathaway, which has the highest-priced stock on the market.

He is a seasoned veteran by surviving market crashes such as Black Monday in 1987, the dot-com bubble in 2000, and the 2008 financial crisis.

During these tough times, Buffet has a very bullish and long-term strategy. He advises investors to be aggressive when others are scared and to capitalize on cheap stock prices.

In a column with the New York Times, Buffett wrote “A simple rule dictates my buying: Be fearful when others are greedy and be greedy when others are fearful”.

Not everyone has Buffett’s patience and confidence, but he does give some solid advice on how to handle a recession.

In this past quarter (Q1), Buffet took advantage of the struggling stock market and purchased $51 billion worth of stock. Buffet is sticking to is investing strategy of buying companies when they have lower value. 

Cathie Wood:

Cathie Wood is the founder of Ark Invest, which is a fund dedicated to investing in high growth companies, with the potential to change the world.

The areas she focuses on are cryptocurrencies, artificial intelligence, renewable energies, robotics, and DNA sequencing.

Wood is not a fan of value stocks like Warren Buffet is; instead she focuses on growth stocks and “disruptive innovation”. Her investment strategy comes with a lot of risk, but the rewards are through the roof.

During the 2020 pandemic year, her fund returned 150% which is unheard of. Since then, her fund has erased most of its pandemic gains.

Wall Street has been very critical of Wood, saying she relies too heavily on her own instincts to build a portfolio. Wood’s response to the criticism is that “innovation gains traction during tumultuous times. 

Final Thoughts

A recession is a scary time because it impacts everything around you. It is important to stay updated with the current state of the economy and how the stock market reacts. With summer right around the corner, check out our summer stock tips.

There is not one stock that is guaranteed to be recession proof, but there are characteristics to look for that will help limit your risk.

Invest in companies that have promising products and leadership with obtainable goals. If you can invest smartly during a recession, times of expansion have the potential to be glorious. 

The post Best Recession Stocks appeared first on Wall Street Survivor.