Best Broker for Following Warren Buffett
Which online stock broker should you use to build your Warren Buffett portfolio? The answer is simple. It doesn’t really matter which broker you use.
Since you are investing for the long haul and will be accumulating a large stake over many years, broker trade commissions will quickly become negligible, even if buying shares every month as Buffett recommends.
The biggest advantage of a Warren Buffett portfolio is what we discussed earlier, the super low costs. Remember, for every $10,000 invested in Vanguard’s S&P 500 ETF VOO or mutual fund VFIAX, .05% is only $5 per year in management fees.
Whichever broker you choose, reinvesting the dividends through a DRIP (dividend reinvestment plan) should be a free option (meaning the online broker will not charge you to automatically reinvest the dividends and buy more shares). Our sister site Stoc

This comes back to #9, but it’s worth breaking down the basics. Here are the key terms to understand:
Short term capital gains tax – “Short term capital gains do not benefit from any special tax rate – they are taxed at the same rate as your ordinary income. For 2015, ordinary tax rates range from 10 percent to 39.6 percent, depending on your total taxable income.” – TurboTax
Trade Commission – Charge to buy or sell stock.
Order Execution Quality – Many brokers sell high frequency trading firms the right to “peek” at your order and more or less screw you on your fill. This is called payment for order flow. Despite being $.01 or $.02 per share, poor fill costs can add up real quick when you trade frequently.
Out pe

Limit Orders
Limit orders are stock orders that allow you to buy (or sell) shares of stock at a pre-designated price OR better.
Example: So let’s say we want to buy 10 shares of Microsoft (MSFT) stock, which is currently trading at a last of $123.37 per share, but we only want to pay $123.00 or less for our shares. What we can do is fill out a trade ticket for a buy limit order at $137.00, which basically says, “Hey, I know Microsoft is trading above $123 per share right now, but if the price comes down to $123 or lower, automatically buy me in please”. This same concept applies for using limit orders to sell shares of stock.
When you place your limit order, you can set the duration to have the order expire at the end of the day, end of the week, end of the month, or a year later. Also, the order is automatic, so you do not need to be present when the order takes place. Your onl

What Is a Cyclical Stock?
A cyclical stock refers to an equity security whose price is affected by macroeconomic, systematic changes in the overall economy. Cyclical stocks are known for following the cycles of an economy through expansion, peak, recession, and recovery. Most cyclical stocks belong to companies that sell discretionary items consumers can afford to buy more of during a booming economy. These stocks are also from companies that consumers choose to spend less with and cut back on during a recession.
Understanding Cyclical Stocks
Companies whose stocks are cyclical include car manufacturers, airlines, furniture retailers, clothing stores, hotels, and restaurants. When the economy is doing well, people can afford to buy new cars, upgrade their homes, shop, and travel. When the economy does poorly, these discretionary expenses are som

Issued Share Capital vs. Subscribed Share Capital: An Overview
Share capital refers to the amount of funding a company raises through the sale of shares of stock to public investors. This means the company grants shareholders a small ownership stake in the company in exchange for monetary investment. Share capital constitutes the main source of equity financing and can be generated through the sale of common or preferred shares.
Common stock is what most people think of when they talk about the stock market. Common, or ordinary, shareholders have voting rights and participate in major company decisions. Though companies at times pay dividends on common shares, they are no

What Is a Stock?
A stock (also known as "shares" or "equity") is a type of security that signifies proportionate ownership in the issuing corporation. This entitles the stockholder to that proportion of the corporation's assets and earnings.
Stocks are bought and sold predominantly on stock exchanges, though there can be private sales as well, and are the foundation of nearly every portfolio. These transactions have to conform to government regulations which are meant to protect investors from fraudulent practices. Historically, they have outperformed most other investments over the long run. These investments can be purchased from most online stock brokers. Stock investment differs greatly from real estate investment.
Understanding Stocks

What Is the S&P 500 Index?
The S&P 500 or Standard & Poor's 500 Index is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies. The index is widely regarded as the best gauge of large-cap U.S. equities. Other common U.S. stock market benchmarks include the Dow Jones Industrial Average or Dow 30 and the Russell 2000 Index, which represents the small-cap index.

Preference shares—commonly referred to as preferred stock—have a number of benefits and drawbacks for both issuing companies and investors.
Preference Shares: An Overview
Companies issue preference shares to raise capital. Preference shares carry many of the benefits of both debt and equity capital and are considered to be a hybrid security.
A benefit for investors who hold preference shares is that they receive dividend payments before common stock shareholders. A drawba