The Dumbest Investments Inexperienced Investors Can Make

From leveraged ETFs to shorting stocks, let's talk about a few of the types of investments, derivatives, securities, and funds that inexperienced or risk-adverse investors should avoid if they want to prevent blowing up their family's balance sheet.

Someone forward you this email? No Sweat! Sign up here to get your own If you're having trouble viewing this email, click here Follow Us The Dumbest Investments Inexperienced Investors Can Make From leveraged ETFs to shorting stocks, let's talk about a few of the types of investments, derivatives, securities, and funds that inexperienced or risk-adverse investors should avoid if they want to prevent blowing up their family's balance sheet. Joshua Kennon Investing for Beginners Expert Leveraged ETFs Can Result In Huge Losses in Short Periods of Time Designed for professionals, traders, and speculators, leveraged ETFs have found wide market acceptance for the ease at which they allow bets to placed with the underlying results amplified, in some cases by 300%.  However, I've noticed a shocking and ill-advised rise in new, completely inexperienced investors buying them for a portfolio, which is entirely inappropriate and could very well lead to substantial, permanent losses. READ NOW Even If Rates Are Cheap, Don't Buy Stocks on Margin During periods of record low interest rates, it might be tempting to roll the dice and buy stocks on margin, borrowing money from your broker.  Don't do it.  Here are some of the reasons. READ NOW The Basics of Shorting Stock When you short a stock, you are betting that the price will decline.  However, unless you take an offsetting position, you expose yourself to potentially unlimited losses which could very well drive you into bankruptcy. READ NOW Over-the-Counter Derivatives OTC derivatives can be extraordinarily risky if abused.  In other situations, they can lessen risk.  Understanding what they are, and how they work, is important to develop a full picture of the way the financial markets function and interact with the real economy. READ NOW Featured Articles • Who Invented the First Parachute? • Who knew retiring on a paradise island was this attainable? • Top 10 Home-Based Business Ideas • Over 40? 7 Ways to Jump Start Your Retirement Savings • Whether earning or paying, what is interest? • How to Build Small Business Credibility and Why You Should • 3 Ways Day Traders Increase Their Wealth • 5 Simple Budgeting Guidelines to Follow Advertisement About Investing for Beginners  |  Follow Us You are receiving this newsletter because you subscribed to the Investing for Beginners newsletter. If you wish to unsubscribe, please click here 1500 Broadway, 6th Floor, New York, NY, 10036 © 2015 About.com - All rights reserved. Privacy Policy.

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