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Tip of the Day Avoid Fees

Avoid Fees - When using long-term investments as a money-earning vehicle, it is wise to remember that any returns that are made on that money must deduct any fees paid...

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Loads

Definition: Loads are sales charges issued by the mutual fund.  If you pay the charge up front, it's called a "front end load."  If you pay it when you sell your shares, it's called a back end load.

TeenAnalyst Advice: As a young investor myself, I stay away from mutual funds with sales charges.  A mutual fund with a front end load of 3% means that for every $100 you give them, only $97 is invested.  It might seem like you're only losing $3.00 but if you keep that money invested for 50 years, it'll end up costing you $353 in lost compounding!*

Most mutual funds today are referred to as "no-load" funds because they don't charge these loads.  I recommend you stick with one of those.

*Assuming 11% annual rate of return.

 

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Definition of the Day Quick Ratio

Definition: A ratio that measures a company's ability to meet its current liabilities with its liquid assets. TeenAnalyst Advice: It's important that a company be able to pay their debts and other ...

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