Menu
Brokers
MT4 Forex Brokers
MT5 Forex brokers
PayPal Brokers
Skrill Brokers
Oil Trading Brokers
Gold Trading Brokers
Web Browser Platform
Brokers with CFD Trading
ECN Brokers
Bitcoin FX Brokers
PAMM Forex Brokers
With Cent Accounts
With High Leverage
Cryptocurrency Brokers
Forums
All threads
New threads
New posts
Trending
Search forums
What's new
New threads
New posts
Latest activity
Log in
Register
Search
Search titles only
By:
Search titles only
By:
Menu
Install the app
Install
Reply to thread
Forums
Advertisements
Advertisements
Solid ECN Securities | Best Place to Trade CFD Products
JavaScript is disabled. For a better experience, please enable JavaScript in your browser before proceeding.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an
alternative browser
.
Message
[QUOTE="SOLIDECN, post: 208856, member: 80239"] [JUSTIFY][img]https://i.ibb.co/5561rDP/forum-4.png[/img] [B]Investors Are Poor Market Timers[/B] Let's face it, we're not as calm and rational as we claim to be. In fact, one of the inherent flaws in investor behavior is the tendency to be emotional. Many individuals claim to be long-term investors until the stock market begins falling, which is when they tend to withdraw their money to avoid additional losses. Many investors fail to remain invested in stocks when a rebound occurs. In fact, they tend to jump back in only when most of the gains have already been achieved. This type of buy high, sell low behavior tends to cripple investor returns. According to Dalbar's Quantitative Analysis of Investor Behavior study, the S&P 500 had an average annual return of just over 6% during the 20-year period ending Dec. 31, 2019. During the same time frame, the average investor experienced an average annual return of about 2.5%. There are a few reasons why this happens. Here are just a couple of them:[/JUSTIFY] [LIST] [*][JUSTIFY]Investors have a fear of regret. People often fail to trust their own judgment and follow the hype instead, especially when markets drop. People tend to fall into the trap that they'll regret holding onto stocks and lose a lot more money because they drop in value so they end up selling them to assuage that fear.[/JUSTIFY] [*][JUSTIFY]A sense of pessimism when things change. Optimism prevails during market rallies but the opposite is true when things turn sour. The market may experience fluctuations because of short-term surprise shocks, such as those related to the economy. But it's important to remember that these upsets are often short-lived and things will very likely turn around.[/JUSTIFY] [*][JUSTIFY]Investors who pay too much attention to the stock market tend to handicap their chances of success by trying to time the market too frequently. A simple long-term buy-and-hold strategy would have yielded far better results.[/JUSTIFY] [/LIST] [JUSTIFY] [B]Lower Capital Gains Tax Rate[/B] Profits that result from the sale of any capital assets end up in a capital gain. This includes any personal assets, such as furniture, or investments like stocks, bonds, and real estate. An investor who sells a security within one calendar year of buying it gets any gains taxed as ordinary income. These are referred to as short-term capital gains. Depending on the individual's adjusted gross income (AGI), this tax rate could be as high as 37%. [img]https://i.ibb.co/DrCHRMd/forum-1.png[/img] Any securities that are sold after being held for more than a year result in long-term capital gains. The gains are taxed at a maximum rate of just 20%. Investors in lower tax brackets may even qualify for a 0% long-term capital gains tax rate. [B]Less Costly[/B] One of the main benefits of a long-term investment approach is money. Keeping your stocks in your portfolio longer is more cost-effective than regular buying and selling because the longer you hold your investments, the fewer fees you have to pay. But how much does this all cost? As we discussed in the last section, you save on taxes. Any gains from stock sales must be reported to the Internal Revenue Service (IRS). That ends up increasing your tax liability, which means more money out of your pocket. Remember, short-term capital gains can cost you more than if you hold your stocks for a longer period of time. [img]https://i.ibb.co/fXxXW4X/forum-2.png[/img] Then there are trading or transaction fees. How much you pay depends on the type of account you have and the investment firm that handles your portfolio. For instance, you may be charged a commission or markup, where the former is deducted when you buy and sell through a broker while markups are charged when the sale is directed through their own inventory. These costs are charged to your account whenever you trade stocks. This means your portfolio balance will drop with every sale you make. Firms often charge ongoing fees, such as account maintenance charges, that can also put a dent in your account balance. So if you're a regular trader who has a short-term goal, your fees will add up even more when you factor in transaction fees. [B]Compounding With Dividend Stocks[/B] Dividends are corporate profits distributed by companies with a track record of success. These tend to be blue chips or defensive stocks. Defensive stocks are companies that do well regardless of how the economy performs or when the stock market drops. These companies pay regular dividends—usually every quarter—to eligible shareholders, which means that you get to share in their success. While it may be tempting to cash them out, there's a very good reason why you should reinvest the dividends into the companies that actually pay them. [img]https://i.ibb.co/H2n3PWT/forum-3.png[/img] If you own any bonds or mutual funds, you'll know about how compound interest affects your investments. Compound interest is any interest calculated on the principal balance of your stock portfolio and any earlier interest you earned. This means that any interest (or dividends) that your stock portfolio accumulates compounds over time, thereby increasing the amount of your account in the long run.[/JUSTIFY] [URL='https://solidecn.com/Account/Register'][ATTACH type="full"]21728[/ATTACH][/URL] [HR][/HR] [B]Solid ECN brings vital advantages for forex traders in the US, EU, and beyond. High levels of transparency mean price manipulation is impossible[/B] [URL='https://solidecn.com/?utm_source=earnforex&utm_medium=paidpost&utm_campaign=feature'][B]solidecn.com[/B][/URL] [HR][/HR] [URL='https://www.instagram.com/solidecn/']instagram[/URL] | [URL='https://www.facebook.com/solidecn']facebook[/URL] | [URL='https://twitter.com/solidecn']twitter[/URL] | [URL='http://www.linkedin.com/in/solidecn']linkedin[/URL] [/QUOTE]
Insert quotes…
Verification
Post reply
Top
Bottom
This site uses cookies to help personalise content, tailor your experience and to keep you logged in if you register.
By continuing to use this site, you are consenting to our use of cookies.
Accept
Learn more…