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I N V E S T I N G B A S I C S Wednesday, November 15, 2000 benjamin.rogers@enron.com _________________________________________________________________ REGISTER TO BECOME A FOOL -- GET FREE STUFF! http://www.fool.com/m.asp?i=3D196112 _________________________________________________________________ Sponsored By: BUYandHOLD Hey Fool! Want to know the SECRET to long-term investing? Compounding and dollar-cost averaging! Start investing with as little as $20! Just $2.99 per order. http://www.lnksrv.com/m.asp?i=3D196113 ASK THE FOOL -- Q. I want to open a brokerage account, but the firms I called require between $1,000 and $5,000 upfront, just to open an account. What can I do? -- A. Many brokerages don't have minimums. Details about and ratings for scores of discount brokerages, both traditional and online, can be found in SmartMoney magazine, the American Association of Individual Investors Journal and other periodicals. Online brokerages are also reviewed and rated at gomez.com. http://www.lnksrv.com/m.asp?i=3D196114 Note that commissions for discount brokerages have fallen to as low as $5 or $10 per trade. (And some of them are offering free trades to those with certain minimum balances.) This is a far cry from the typical discount commission of $30 to $50 a few years ago and the hundreds of dollars that some full-service brokerages will still charge you today. -- Q. I'm 14 years old. How much risk should I apply to what I'm investing? -- A. We love questions like this! If only all 14-year olds were learning about investing. Anyone can afford to take on some risk by investing in stocks -- as long as the money won't be withdrawn within the next five or more years. If the money you're investing is for college, stocks aren't a good idea, as the market could drop in the short term. Those investing for the long haul can patiently ride out downturns. Short-term investors should stick to safer plays, like money market funds. You're smart to start young. Let's say you invest $500 and it earns the average annual market rate of 11 percent. In 30 years, when you're only 44, it'll become $11,446. Sock it away until retirement at 65 and it'll be nearly $100,000. Add to it over the years and you're looking at early retirement! Got some questions of your own for the Fool? Head to our Help area or post your question on the Ask a Foolish Question discussion board. http://www.fool.com/m.asp?i=3D196115 http://www.fool.com/m.asp?i=3D196116 _________________________________________________________________ INVESTING BASICS - CALLING ALL WOMEN If you know a woman who isn't yet investing, clip out this article and pass it on to her. She may thank you one day from the bottom of her wallet. Many women (and men, too) are steering clear of the stock market, and they're paying a high price for it. Consider these facts. Wives tend to be less involved than husbands in household investing and retirement planning. Most married women outlive their husbands. Fully 80 percent of all widows in poverty became poor only after the death of their husbands. In 1992, 87 percent of the elderly poor in America were women. If we've now depressed you, hold on. There's good news, too. More women are investing today than in the past. A 1997 study commissioned by the National Association of Securities Dealers found that 47 percent of investors were women, up from 37 percent in 1990. When women invest, they can do very well. According to recent National Association of Investors Corp. (NAIC) statistics, the average annual lifetime return for all-women investment clubs was 17.9 percent, compared with 15.6 percent for all-men clubs (in 1997). Brad Barber and Terrance Odean, professors at the University of California at Davis business school, offer an explanation. In a 1998 study, they found that men are more likely than women to be overconfident and to trade frequently. Single men, for example, traded 67 percent more than single women, reaping lower returns. Here are some guidelines for women -- and heck, men -- interested in getting started: 1. Take the time to learn first. Don't jump into any investment without understanding it and being comfortable with it. Read "One Up on Wall Street" by Peter Lynch or our "You Have More Than You Think." http://www.lnksrv.com/m.asp?i=3D196117 http://www.lnksrv.com/m.asp?i=3D196118 2. Don't be afraid to take on some risk. Sticking to low-risk choices like bonds or money market funds dooms you to lower returns. As long as you're investing for five to ten or more years, you can afford to ride out any short-term market downturns. 3. Consider forming an investment club. Learn how with the NAIC at better-investing.org. http://www.lnksrv.com/m.asp?i=3D196119 _________________________________________________________________ IN THE SPOTLIGHT -- Thinking about opening a new brokerage account? Visit our Discount Brokerage Center. http://www.fool.com/m.asp?i=3D196120 -- Steer a young one you know to our investing area for teens. http://www.fool.com/m.asp?i=3D196121 -- Here's a great wake-up call for women. You might print it out and pass it on to some friends: http://www.fool.com/m.asp?i=3D196122 _________________________________________________________________ A NOTE FROM THE AUTHOR=01( I hope you're finding this product useful. The content originally appeared as part of our nationally syndicated newspaper feature (which I also prepare). Consider giving your local editor a jingle and suggesting that they think about carrying the Fool. http://www.fool.com/m.asp?i=3D196123 Selena Maranjian http://www.fool.com/m.asp?i=3D196124 _________________________________________________________________ My Portfolio: http://www.fool.com/m.asp?i=3D196125 My Discussion Boards: http://www.fool.com/m.asp?i=3D196126 My Fool: http://www.fool.com/m.asp?i=3D196127 Fool.com Home: http://www.fool.com/m.asp?i=3D196128 My E-Mail Settings: http://www.fool.com/m.asp?i=3D196129 Sponsored By: BUYandHOLD Hey Fool! Want to know the SECRET to long-term investing? Compounding and dollar-cost averaging! Start investing with as little as $20! Just $2.99 per order. http://www.lnksrv.com/m.asp?i=3D196130 FREE FOR FOOLS! Investor's Business Daily will send you a free copy of 24 Essential Lessons for Investment Success when you sign up for a free trial subscription of their newspaper. http://www.lnksrv.com/m.asp?i=3D196131 FREE PREVIEW OF WIRELESS 201 Get a sneak peek at this best-selling report at Soapbox.com http://www.lnksrv.com/m.asp?i=3D196132 BECOME A FOOL! Get a FREE Investing Guide and more... http://www.fool.com/m.asp?i=3D196133 FOOL DIRECT E-MAIL SERVICES Need to change your address or unsubscribe? You can also temporarily suspend mail delivery. Click here: http://www.fool.com/community/freemail/freemaillogin.asp?email=3Dbenjamin.r= ogers @enron.com Have ideas about how we can improve the Fool Direct or new e-mail products you'd like to see? Try our discussion board: http://www.fool.com/m.asp?i=3D196134 ____________________________________________________ © Copyright 2000, The Motley Fool. All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without the prior written consent of The Motley Fool. MsgId:=20 msg-17676-2000-11-15_11-02-47-3976794_5_Plain_MessageAddress.msg-11:11:31(1= 1-1 5-2000) X-Version: mailer-sender-master,v 1.84 X-Version: mailer-sender-daemon,v 1.84 Message-Recipient: benjamin.rogers@enron.com
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