Return to Types of corporations home. Type Suited for which typeof investor Expansion opportunities Competition Does what with profits Relates to Watch out for Defensive Conservative, who wants to be proactive when recession appears imminent Average Average Usually pays out enough for substantial dividends with some kept to grow business The best may also
It is important that beginning investors have the right frame of mind as they get started. In this article, we’ll identify the most important characteristics of the market and of successful investors.
Sure, we’ve identified a “Dirty Dozen” investing risks. Actually, at 13 it’s a Baker’s Dozen. But is that is all of them? Not by a long shot! Giving a name to everything that can possibly go wrong is actually good business. Corporations know that if they warn potential investors (in their Prospectus before they go public and
What is Geopolitical risk? The risk that as relationships between countries deteriorate they will take their hostilities out on a corporation you have an investment in.
What is Interest rate risk? The risk that after you commit to lending your money out for a significant number of years at a fixed rate, interest rates in the economy rise. Had you waited a while before making your loan, you would have been able to lock in a higher rate of interest.
What is Liquidity risk? The risk that when you want to sell an investment, there will be no buyers interested in paying what you believe is a fair price for it. How this risk plays out in the real world Following are articles that concern the issue of liquidity and not a specific corporation’s stock
What is Company risk? (also known as Business risk, Business failure risk and Single stock risk) The risk that you will lose money simply because you chose to invest in a certain corporation and going forward it fails to keep up with competitors.
What is Economic risk? The risk that an overall downturn in the economy will result in lower sales and profits (and consequently lower stock prices) for the corporations you invested in.
What is inflation risk? It is the risk that the annual rate of increase in the prices of the goods we buy and services we consume will be higher than you were anticipating. When a higher inflation rate is subtracted from the rate of return your investments are earning, soon you may be left achieving
By SUSANNA KIM (@skimm) Sept. 13, 2012 – The Federal Reserve announced its highly-anticipated quantitative easing, or its so-called QE3, purchasing additional agency mortgage-backed securities at a pace of $40 billion per month in another effort to stimulate the struggling economy.