Magazine article Newsweek

Money Notes

Magazine article Newsweek

Money Notes

Article excerpt

SECURITY Report Cards for Stocks

HOW RISKY IS THAT TECH STOCK you've been watching all week? At RiskGrades.com, every stock has a number that tells you how volatile it is and how much money it could lose for you on a bad day. Founded by statisticians from investment-banking firm J.P. Morgan, the site grades individual stocks, funds, bonds, options and whole portfolios. The Standard & Poor's 500 Index has a grade of 99; at 300, Office Depot is three times as volatile. Investors can cut their risks by building a diverse portfolio, and RiskGrades lets investors play "what if" games to see how adding or subtracting a stock, bond, fund or option could raise or lower their risk. For instance, last week Yahoo had a risk grade of 526 and Amazon was pegged at 548. Buy 100 shares of each, and your total risk score drops to 488. How's that for a balanced portfolio?

SAVING Opportunities Lost

CONSUMERS ARE LOSING $30 BILlion or more in interest by keeping too much money in low-paying savings accounts, says the Consumer Federation of America. Savers are stashing $1 trillion in bank savings accounts that average just 2.1 percent a year in interest.

Even conservative investors could better without giving up their Federal Deposit Insurance Corporation protection, says Stephen Brobeck, the consumer group's director. They could move their funds to a banks money-market deposit account, now paying better than 6 percent interest at hungrier institutions. Even Uncle Sam is paying 4.9 percent on inflation-proof bonds. …

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