Choosing Investments to Avoid Taxes
A simple and perfectly legal way to avoid any Federal income tax on investments is to choose bonds. The U.S. government does not tax the interest paid on bonds issued by state governments or any of their subsidiaries.

The most magic word in Wall Street in recent years has been “growth.” If you bought “growth” stocks, you were in theory moving along the royal road to riches. Although some growth stocks performed dazzlingly, there can be great peril in paying too much for them, especially if the corporate progress so hopefully predicted may never materialize.

What are growth stocks anyway? Why should people buy them? What are their advantages and disadvantages?

A growth company is essentially one that is increasing (or should increase) its sales and earning power at a much faster rate than business in general or than the growth in population. Growth companies are usually located in dynamic and often new industries.

Learning To Factor Cost Of Living Into Your Investments
Are you old enough to remember the cost of food, clothing, and housing back in the 1930’s, the years before World War II? If so, you know that prices in the late 1950s are a great deal higher. If your memory does not go back that far, you had better find out what happened to the buying power of a dollar, especially between 1940 and 1950, before you select investments.

The invention of the corporation gave way to a new era of financial dealings, melding individuals together to increase their monies, especially with marketable securities.

But first, what is a corporation? It is an intangible legal being designed to assure an organization unlimited life and limited liability. Corporations are of three main types: government or municipal; stock (private) corporations; and religious, charitable, membership or endowment. The first two provide almost all marketable securities.

The corporation first appeared in Europe around the fourteenth century when Queen Elizabeth I was the moving light in the East India Company. Later, a charter was granted by Charles II of England to “The Governor and Company of Adventurers of England Trading into Hudson’s Bay” is still going strong. It’s the oldest company doing business in North America, and its capital stock has been a marketable security for almost three centuries.

Insurance Policy Time Frames
Industrial is the polite word used to cover a group of policies with weekly premiums, offered by a number of companies. So many people pay these weekly premiums that in spite of the small size of individual policies, their total volume is about one tenth of all life insurance issued by U.S. companies. A year’s total of the net payments on an industrial policy is roughly 40 percent higher than when the premium is paid in one sum annually on a comparable policy. Of course, a company incurs extra expense in collecting premiums weekly and keeping records on small policies, but the extra charge looks excessive. Let us hope that none of our readers is careless enough to buy industrial life insurance.

When one has invested money in the market, it is imperative to consider the particular marketable securities to buy. Which marketable securities are chosen is dependent upon one’s own temperament and financial objectives.

Consider one’s temperament first. A nervous, worrying type who broods over a day’s stock-point loss is a conservative investor. Speculation may not be the appropriate security for the conservative investor. Instead, the fixed income or steady dividend-paying stocks may be appropriate for a conservative investor.

The fixed income varieties first are bonds and preferred stocks. These are usually most attractive for purchase when the stock market is very high: when buyers will purchase stocks at yields of 3% or less.

Government Bonds: Still a Safe Bet
One of the safest investments a person can make is to buy bonds from the government—their value is guaranteed and, although returns are small, they will appreciate in value with no input from the investor. No matter how bad conditions may be, the government does not reserve the right to delay payment. An owner merely has to identify himself at a bank or other bond agency, and in a few moments he has the cash, in the amount printed on the bond. Of course, if the banks should close, it might be impossible to raise cash on any investment for a short while. Aside from that possibility, an E bond is practically as liquid as currency in your pocket, and with interest added.

vThe Renewal of Options
Options can very often be extended. Suppose you own a Call contract at 54 on a stock which has risen before the expiration of the option to 65. You feel that if you had more time, the stock could go higher—to 75, 80, or more—in another 60 or 90 days. Through your stock-exchange house or your option-dealer, arrangements may be made for an extension of the contract. The cost of an extension, if it can be made, depends on many things: the option price, the price of the stock in the market, the length of time of the extension, and, of course, the willingness of the original maker of the contract to extend the option.

When embarking on any new business enterprise, the first thing to consider is the amount of capital required. To study tape reading “on paper” is one thing, but to practice and become proficient in the art is quite another. Almost anyone can make money on imaginary trades because there is no risk of any kind — the mind is free from the strain and apprehension that accompanies an actual trade; fear does not enter into the equation, and patience is unlimited.

All this changes when even a small commitment is made. Then the judgment becomes warped, and the trader closes the trade in order to get mental relief.

As these are all symptoms of inexperience, they cannot be overcome by avoiding the issue. The business-like thing to do is to wade right in to the game and learn to play it under conditions that are to be met and conquered before success can be attained.

Insider Hints: A Guide to Choosing Mutual Funds
In nearly all mutual funds an investor can order any number of shares above a low minimum, pay for them at the currently asked price per share, and receive a certificate of ownership. This is the old-style method of buying, and it still suits a good many investors. Each purchase is a complete transaction, and a buyer gives no hint as to when or whose stock, or how much, he intends to buy next time.