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#1
12-26-2006, 12:44 PM
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Stock Market
Nearly all articles here are about stock market investings.
I am a little bit risk averse what concers that. Do you know another good investment? I think i can lay back 1000$ a month atm for 3 month and then go up to even 2k. Why are you so sure that stock market is +EV in the long run? I am 19 and from Germany i don`t have insights in your American Bankings. 
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#2
12-26-2006, 02:34 PM
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Re: Stock Market
Essentially stocks have to offer a return higher than bonds or savings accounts, or no-one would own them because they carry volatility risk whereas a savings account doesn, and neither does a bond if you hold it to maturity.
The problem is that just because the market in general offers that return, it doesn't mean that volatility losses can't be greater than that return over a few years (i.e. U.S. equity markets during the first part of this decade). And individual stocks are even more volatile and uncertain about whether you will earn that return. You are probably best off at a bank in a savings account, or buying a CD, given your current knowledge and comfort level. Eventually you could explore index funds, which are the best way for a passive investor to benefit from higher stock market returns, but only if you can commit to time periods that will ensure you can ride out volatility (easy 5-10 years minimum) risks.
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#4
12-26-2006, 04:07 PM
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Re: Stock Market
CD = Certificate of Deposit. Instead of putting your money into a savings or money market account, a bank will often offer a higher interest rate to you, in exchange for you agreeing to "lock up" your money for a specified duration. Duration can range from 1 month to 5 years or so.
In todays market I think money market rates are so close to CD rates that CD's don't offer much in the way of increased interest. You would just use them to lock down a good rate for a longer period if you are worried interest rates will decline soon.
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