I just want to share with you this article I found in AOL website:

Do you ever wish you had invested in Amazon or Apple before they hit the jackpot? Nobody can predict the future, but if you went back 10 years with only $100 and the knowledge you have now, you could be a billionaire today. [Here is] how it’s possible.

Yahoo (YHOO)

Year: 1997
Jan. 1: $100
Dec. 31: $611

If you invested $100 in Yahoo stock at the start of 1997, the year of the Spice Girls, Hanson, and Titanic, you’d have $611 by the end of the year, thanks to Yahoo’s 511% return. (more…)

In my last post about the power of compound interest, I gave you an example about the difference between simple and compound interest. And that compound interest can give you higher return by reinvesting your earned interest to earn more interest. In this post, I would like to give you (more…)

“The most powerful force in the universe is compound interest”

-Albert Einstein

If you are serious about saving or investing your money, you should understand compound interest. But if you think you’re not yet ready to enter the investment world, and you think that you still have to wait 3 or 5 more years before you start saving money, then I guess you’re the one who really needs to understand the power of compound interest. (more…)

The basic guideline in investing is the country’s inflation rate. All your savings for the long term, time deposits and other investments must produce rates that are higher than inflation. Your earnings rate should be 2 to 4 percent above inflation rate. So, if the inflation rate is 6%, your earnings rate should be 8 to 10%. Otherwise, you will lose a great deal of money especially if you invest for the long term. (more…)

There is another strategy to make money with stocks and this is called short selling. If you sell short, it means you’re expecting a decline in value of the stock so you can make money. Here how it works: To sell short, you borrow shares from your broker, then sell those shares and keep the money. Then you wait, expecting the price of the stock to drop. If it drops, you buy the shares at the lower price and return them to your broker. (more…)

Here’s how investors make money with stocks. One way is through capital appreciation, or making a profit by buying stock at a low price and selling it at a higher price. Wise and successful investors always follow this simple rule: “BUY LOW AND SELL HIGH”.

For example: if you buy 1000 shares of Mcdonald’s at $50/share(total investment of $50,000)and after three months the price moves up to $75/share and you sell it(total of $75,000), you have earned a capital gain of $25/share or $25,000. It’s a 50% profit!

On the other hand, if you buy 1000 shares of Mcdonald’s at $50/share(total investment of $50,000) and if the share price moves against you and you sell it for $25/share(total of $25,000), you have lost $25/share or $25,000. It’s a 50% loss!