If price/earnings is the proper way to value stocks, then stocks are cheaper at this moment than they have been in more than twenty years. Here's a historical comparison and some thoughts on what it means. The price/earnings ratio is generally considered to be the best measure of whether stocks are "cheap" or "expensive." There are, however The extreme stock market volatility of recent months has been difficult for long-term investors. It would be a mistake, however, to overreact. Volatility in itself does not mean a downtrend in the market. The volatility will ease, and can even provide investment opportunities. The most widely watched measure of stock market volatility is the VIX index. Most investors are always looking for a good investment opportunity. However, over the long-term, finding good investment opportunities is step two, not step one. The first thing all investors must do in order to be successful is to learn their own personal "risk tolerance" level. No matter how appealing an investment might look, if it does not... The Bernard Madoff Ponzi scheme rightfully attracts a lot of attention in the media, partially because the victims are generally extremely rich and successful. The media tends to portray the victims as "sophisticated" investors, which makes the Madoff scheme appear to be that much more incredible. However, the "pitch" that Bernie Madoff made to potential investors... Strong stock market gains may be imminent, if historical seasonal patterns hold. The six months of November through April have posted amazingly superior gains relative to the six months of May through October over recent decades. The underlying fundamentals are in place to continue this... Corporate profits and their associated cash flows are at the heart of why investors buy shares in companies. While investors tend to understand the origin and importance of profits for individual companies, few have an understanding of how the economy in aggregate generates corporate profits, and thus don't know when... The term "Wall Street" refers to the entire financial industry. But like all streets, Wall Street has two sides: the buy-side, and the sell-side. One side is quiet, the other talks all the time. To an investment banker, stock is a product. That product is created, through an IPO, and then sold... Chat rooms are a great place to get a feel for the sentiments of other investors. But relying on chat rooms as a solid source of information about your investments is often a mistake. The possibility of misinformation is high, particularly if you haven't developed a "relationship" with the person who is posting... "What to buy" has always been the hardest decision in investing. There have always been investment newsletters offering ideas. And public companies have always hired public relations firms to promote themselves. But the Internet era has produced an entirely new breed of ... Daytraders first received a lot of press in July 1999 following the tragic events at All-Tech Trading and Momentum Securities in Atlanta, Georgia, where Mark Barton shot 22 people, killing 9 of them. The media reported that he lost $105,000 in eight weeks. But while the press focused extensively on the... We frequently get questions about IPOs. The ones that skyrocket on their first day of trading make investors wonder why all of them don't rise that much. Meanwhile some investors put in orders for an IPO stock, and wind up overpaying, or failing to "catch the ride." We also get a lot of... We don't listen to Alan Greenspan because he peruses 18,000 indicators in his bathtub. And we don't listen to him because he's married to Andrea Mitchell. And we certainly don't listen to him because of his oratory skills. We listen to him because he controls short-term interest rates, and ultimately, interest rates do matter... As a component of your overall portfolio, preferred stock may be a nice component for stability and income. Generally, preferred stock available on the market is issued by larger blue chip companies. Here is a brief summary of preferred stock. Higher Claim than Common Stock Preferred stock is a separate class of stock from... Can you name three top-ranked sell-side analysts? If you can, you're in the minority. Most retail investors probably couldn't name more than one or two top-ranked analysts, if any. But you can be certain that the buy-side folks know who's ranked where. The rankings do not resonate as loudly on the individual investor side... Even though the Internet stock bubble eventually burst, one thing should be kept in mind. The Internet created the possibility of very scalable business models. Despite what happened to Internet stocks in general, the right investment in a good scalable business model could still prove to be a great investment going forward... The Securities and Exchange Commission was created in the '30s, after the 1929 crash to help protect investors. One of the requirements that the SEC instituted to help keep investors informed are the filing requirements. Here's a list of the basic SEC filing requirements and forms... Trading of all stock is regulated by the Securities and Exchange Commission (SEC). Officers and directors of companies, owners of restricted stock, and owners of more than 10% of a company's stock are legally required to let the SEC, and thereby the public, know when they sell, or intend to sell their stock. Today's Brief outlines the forms that are used... Tracking stocks have become a popular way for a company to "spin-off" a separate division. However, issuing tracking stock is not the same as creating a completely independent company with separately traded stock. Tracking stocks are usually issued by a parent company to create a financial vehicle to track the performance of a particular division or subsidiary. When a parent...