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Yahoo
4 hours ago
- Business
- Yahoo
How Much Does It Matter Which Investment Fund You Pick? (And How To Pick a Good One)
The decision to invest is a relatively easy one — you want to save money for a future purchase or for a comfortable retirement, and you want that money to make more money for you. So, you decide to invest it. That's the easy part. Find Out: Try This: But then you need to decide what to invest in. You could buy stocks, bonds, mutual funds, bitcoin, collectables, commodities — the list goes on and on. Mutual funds are the best solution for many circumstances. They are readily available, easy to own and trade, and offer instant diversification. But which mutual fund — or funds? In 2023, there were 7,222 mutual funds in the United States, according to Statista. Which one(s) should you choose? Does it matter? How do you decide? It's easy to assume all mutual funds are more-or-less the same, but they can vary widely in terms of risk, performance and fees. Investing in the wrong fund could mean your time horizon doesn't match, potentially leading you to make withdrawals in a down market, or it could mean you end up paying far more in fees than you might otherwise, among other differences. Here's what you need to know about the factors that should go into determining which investment fund(s) you should choose. For You: The first question to ask yourself is what you hope to accomplish by investing. Do you want to earn enough money so you can eventually live off your returns and never touch your principal? You'll need a relatively aggressive fund that reinvests dividends. Do you want your investments to generate income you can use to supplement your paycheck? Look for a fund made up of dividend stocks. Do you want something that's nearly a sure thing, earning a relatively small return but with little danger of losing money? A bond fund may fit the bill. The amount of time you plan to invest for can make a difference in what type of investment you choose. If you have a short time horizon, say three years or less, look for low-risk investments like bond funds. These have a guaranteed rate of return, so you won't run the risk of having to withdraw your money in a down market. If you plan to stay invested for 20 years or more, you can look at stock mutual funds that include investments that are more volatile. Understanding your risk tolerance is critical, not only to your investing success, but to your mental health. If you plan to invest over the long term, you also need to be able to sleep at night, so it's important to know how much risk you feel comfortable taking. If you have a high risk tolerance, you are willing to invest in more volatile funds, which will inevitably lose money at some point. You need to be comfortable watching your portfolio value go down — sometimes to less than the amount you originally invested — with the understanding that it may go up significantly in the future. If you are only comfortable with investments that will preserve your original investment, your risk tolerance is low, and you should invest accordingly. Your portfolio will likely grow more slowly, but you won't be in a position where your original investment is in jeopardy. Mutual fund companies have expenses and charge fees, because they need to make money in order to operate. These fees and expenses can take a chunk out of your investment returns, so it's important to understand how much you'll be paying and to choose a fund that has the right mix of potential returns and expenses. Mutual funds will have operating costs, like investment advisory fees, brokerage fees, marketing expenses, custodial fees and more. These costs are typically paid out of the assets of the fund, so you won't see a charge on your statement for these. They do, however, reduce your return on the investment, so you're paying them indirectly. These expenses are grouped together under the category of annual fund operating expenses. You will also pay a sales charge, which is a percentage of the amount you invest, exchange or transaction fees when you trade funds, an account fee and other fees. These are collectively referred to as shareholder fees. All of these fees and expenses should be outlined in the prospectus you receive before you invest in a particular fund. When you are considering which fund to invest in, be sure to compare the fees and expenses. Every investor knows — or should — that past performance is not a guarantee of future results. In fact, that statement is at the bottom of virtually every informational or marketing piece for every investment. And it's true. However, those funds that do well are typically well-managed by managers who know what they're doing, so a high performing fund may be a better option that one that consistently under-performs. One way to evaluate a fund's performance is against a benchmark like the S&P 500. If you feel that this comparison is difficult or inadequate, you can invest in an index fund that tracks the performance of the S&P 500 or one of many other indices. You won't beat the benchmark, but your return should just about equal it. It's a good idea to understand the differences between various investment funds and how they can impact your return, and you should compare like funds before deciding to invest. But at the end of the day, the difference in your return — at least between two or more funds that are right for your objectives, time horizon and risk tolerance, and that are similar in performance — is likely to be relatively small. Don't let paralysis by analysis prevent you from investing. More From GOBankingRates Surprising Items People Are Stocking Up On Before Tariff Pains Hit: Is It Smart? 5 Cities You Need To Consider If You're Retiring in 2025 This article originally appeared on How Much Does It Matter Which Investment Fund You Pick? (And How To Pick a Good One) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 hours ago
- Business
- Yahoo
Markel Group (NYSE:MKL) delivers shareholders respectable 14% CAGR over 5 years, surging 4.4% in the last week alone
If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can do a lot better than that by buying good quality businesses for attractive prices. For example, the Markel Group Inc. (NYSE:MKL) share price is up 90% in the last five years, slightly above the market return. Zooming in, the stock is up a respectable 18% in the last year. After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. During the five years of share price growth, Markel Group moved from a loss to profitability. That's generally thought to be a genuine positive, so investors may expect to see an increasing share price. Since the company was unprofitable five years ago, but not three years ago, it's worth taking a look at the returns in the last three years, too. We can see that the Markel Group share price is up 41% in the last three years. During the same period, EPS grew by 2.6% each year. This EPS growth is lower than the 12% average annual increase in the share price over three years. So one can reasonably conclude the market is more enthusiastic about the stock than it was three years ago. The image below shows how EPS has tracked over time (if you click on the image you can see greater detail). We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.. It's nice to see that Markel Group shareholders have received a total shareholder return of 18% over the last year. That's better than the annualised return of 14% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Markel Group better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Markel Group , and understanding them should be part of your investment process. There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Business
- Yahoo
Markel Group (NYSE:MKL) delivers shareholders respectable 14% CAGR over 5 years, surging 4.4% in the last week alone
If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can do a lot better than that by buying good quality businesses for attractive prices. For example, the Markel Group Inc. (NYSE:MKL) share price is up 90% in the last five years, slightly above the market return. Zooming in, the stock is up a respectable 18% in the last year. After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. During the five years of share price growth, Markel Group moved from a loss to profitability. That's generally thought to be a genuine positive, so investors may expect to see an increasing share price. Since the company was unprofitable five years ago, but not three years ago, it's worth taking a look at the returns in the last three years, too. We can see that the Markel Group share price is up 41% in the last three years. During the same period, EPS grew by 2.6% each year. This EPS growth is lower than the 12% average annual increase in the share price over three years. So one can reasonably conclude the market is more enthusiastic about the stock than it was three years ago. The image below shows how EPS has tracked over time (if you click on the image you can see greater detail). We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.. It's nice to see that Markel Group shareholders have received a total shareholder return of 18% over the last year. That's better than the annualised return of 14% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Markel Group better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Markel Group , and understanding them should be part of your investment process. There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Business
- Yahoo
Do Cinemark Holdings' (NYSE:CNK) Earnings Warrant Your Attention?
The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. While a well funded company may sustain losses for years, it will need to generate a profit eventually, or else investors will move on and the company will wither away. If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Cinemark Holdings (NYSE:CNK). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Cinemark Holdings has undergone a massive growth in earnings per share over the last three years. So much so that this three year growth rate wouldn't be a fair assessment of the company's future. So it would be better to isolate the growth rate over the last year for our analysis. Cinemark Holdings boosted its trailing twelve month EPS from US$1.78 to US$2.13, in the last year. That's a 19% gain; respectable growth in the broader scheme of things. It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. Not all of Cinemark Holdings' revenue this year is revenue from operations, so keep in mind the revenue and margin numbers used in this article might not be the best representation of the underlying business. Cinemark Holdings reported flat revenue and EBIT margins over the last year. That's not a major concern but nor does it point to the long term growth we like to see. The chart below shows how the company's bottom and top lines have progressed over time. Click on the chart to see the exact numbers. See our latest analysis for Cinemark Holdings You don't drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for Cinemark Holdings' future profits. It's pleasing to see company leaders with putting their money on the line, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. So it is good to see that Cinemark Holdings insiders have a significant amount of capital invested in the stock. Indeed, they have a considerable amount of wealth invested in it, currently valued at US$416m. Investors will appreciate management having this amount of skin in the game as it shows their commitment to the company's future. One positive for Cinemark Holdings is that it is growing EPS. That's nice to see. To add an extra spark to the fire, significant insider ownership in the company is another highlight. The combination definitely favoured by investors so consider keeping the company on a watchlist. What about risks? Every company has them, and we've spotted 1 warning sign for Cinemark Holdings you should know about. There's always the possibility of doing well buying stocks that are not growing earnings and do not have insiders buying shares. But for those who consider these important metrics, we encourage you to check out companies that do have those features. You can access a tailored list of companies which have demonstrated growth backed by significant insider holdings. Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
5 hours ago
- Business
- Yahoo
Do Cinemark Holdings' (NYSE:CNK) Earnings Warrant Your Attention?
The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. While a well funded company may sustain losses for years, it will need to generate a profit eventually, or else investors will move on and the company will wither away. If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Cinemark Holdings (NYSE:CNK). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Cinemark Holdings has undergone a massive growth in earnings per share over the last three years. So much so that this three year growth rate wouldn't be a fair assessment of the company's future. So it would be better to isolate the growth rate over the last year for our analysis. Cinemark Holdings boosted its trailing twelve month EPS from US$1.78 to US$2.13, in the last year. That's a 19% gain; respectable growth in the broader scheme of things. It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. Not all of Cinemark Holdings' revenue this year is revenue from operations, so keep in mind the revenue and margin numbers used in this article might not be the best representation of the underlying business. Cinemark Holdings reported flat revenue and EBIT margins over the last year. That's not a major concern but nor does it point to the long term growth we like to see. The chart below shows how the company's bottom and top lines have progressed over time. Click on the chart to see the exact numbers. See our latest analysis for Cinemark Holdings You don't drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for Cinemark Holdings' future profits. It's pleasing to see company leaders with putting their money on the line, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. So it is good to see that Cinemark Holdings insiders have a significant amount of capital invested in the stock. Indeed, they have a considerable amount of wealth invested in it, currently valued at US$416m. Investors will appreciate management having this amount of skin in the game as it shows their commitment to the company's future. One positive for Cinemark Holdings is that it is growing EPS. That's nice to see. To add an extra spark to the fire, significant insider ownership in the company is another highlight. The combination definitely favoured by investors so consider keeping the company on a watchlist. What about risks? Every company has them, and we've spotted 1 warning sign for Cinemark Holdings you should know about. There's always the possibility of doing well buying stocks that are not growing earnings and do not have insiders buying shares. But for those who consider these important metrics, we encourage you to check out companies that do have those features. You can access a tailored list of companies which have demonstrated growth backed by significant insider holdings. Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
