Investing Basics

Judging from your comments, I have to occasionally be reminded that not all readers are grizzled stock market veterans that already know all of the investing basics. So, today, I’ll tell you about five sites where you can get up to speed on investing. The first three are mostly about stocks and funds, the fourth overviews retirement planning, and the fifth is about investing in bonds.

If you’re a beginner, I suggest going in the order that I present them here. If you are a grizzled veteran, you’ll probably find the third site described, GreekShares.com, to be of most interest, at least in terms of stock investing. 

T. Rowe Price Insights Reports
Although T. Rowe Price is a mutual fund company, its T. Rowe Price Insights Reports cover all types of stock market investments. For instance, you’ll find reports describing strategies for selecting everything from conservative stocks to emerging growth, technology, health care, and international stocks. Other reports describe the basics of dollar cost averaging, fixed income investing, exchange-traded funds and money market securities.

Price offers 40 or so information-packed reports, each three or four pages in length, and much more than a simple overview. Even seasoned investors will probably learn something new.  Find them by selecting Publications under Investment Planning Tools on TRP’s Individual Investors' homepage (www.troweprice.com).

Path To Investing
Path to Investing (www.pathtoinvesting.org), run by a non-profit affiliated with the Securities Industry and Financial Markets Association, is devoted entirely to educating you about all aspects of investing from financial planning to detailed investing strategies.

The site offers a dozen or so in-depth 24-page reports on various aspects of investing written by well-know experts such as Jeremy Siegel, author of the best selling book, “Stocks for the Long Run,” and Sam Stovall, Chief Investment Strategist at Standard & Poor’s. The reports cover everything from asset allocation to choosing a broker to gauging risk and return, and many contain information that almost all investors would find useful.

For example, do you want to know how the Federal Reserve actually goes about increasing or reducing the money supply, or controlling short-term interest rates? Check out “The Fed and the Markets” written by Anthony Santomero, President of the Federal Reserve Bank of Philadelphia.

The site also offers many shorter reports on topics ranging from “financial self defense for women” to “small business retirement plans,” as well as a variety of games and quizzes designed to help you learn about different investing topics.

GreekShares.com
Getting down to the nitty-gritty, GreekShares.com (www.greekshares.com) offers a more “in the trenches” take than the academic tone set by T. Rowe Price and Path to Investing. The site is run by Ioannis – Evangelos Haramis, and headquartered in Athens, Greece. Haramis, an investor, stockbroker, and consultant, says he was born in Greece but studied Economics and other topics in the U.S. and Belgium, as well as in Greece.

GreekShares.com’s main feature is Learn to Invest, which is comprised of hundreds of punchy chapters, each crammed with actionable information, and all appropriate to U.S. markets.

Haramis divides Learn to Invest into sections, starting simply and then heading into advanced territory. For instance, the Prologue and Preliminary sections describe basic investing tenets, such as don’t try to get rich quick, while the Elementary section, which contains 61 chapters, delves into the details of stock trading, market definitions, the characteristics of bull and bear markets, and much more.

The 36 chapters in the Intermediary section describe economic terms, valuations ratios, dividends, stock-splits, and other basics that you need to know. But these chapters are more than simple definitions. Haramis tells you how to interpret the information. For example, when explaining the difference between primary and diluted earnings per share, Haramis describes how a company’s shares can be made to appear cheaper or more expensive depending on whether the primary or diluted figure is used to calculate the price/earnings ratio.

Haramis’ 53-chapter Advanced section gets into the details of investing strategies and analysis, and his Post Graduate section delves more into trading strategies, technical analysis, puts and calls, and other advanced topics.

Retirement Planning
If you’re interested in retirement planning, Mutual of America’s Retirement Center (www.mutualofamerica.com) covers the basics. The site offers a good description of what you should be thinking about in terms of retirement planning at each life stage (e.g. 20s, 30s, 40s, 50s, or 60s). Mutual helps you to figure out how much you’ll need to live on when you retire, the pros and cons of early retirement, and investment strategies for achieving your goals. Considering that Mutual is in the business of selling retirement products such as annuities, its coverage of that topic is rather skimpy.

Check the Securities & Exchange Commission site (www.sec.gov/answers/annuity.htm) for a good review of the pros and cons of investing in annuities.

Investing In Bonds
For information about investing in bonds, InvestingInBonds.com is a good starting place. The site, created by the Securities Industry and Financial Markets Association, offers a good description of bond types (municipal, corporate, junk, etc.) plus an overview of bond investing strategies.

All of the sites I’ve described are free. Please let me know about any worthwhile educational sites that I should add to the list.
published 11/25/07