In the Stock Chapter we define stocks as “common” or “preferred”: big, medium and small: growth or value. The characteristics cited above can cause each type of stock to behave differently under different market conditions. We discuss dividends, splits, puts and calls, indexes and exchanges. Foreign stocks are discussed as to the effects of dollar exchange rates and if a country is considered developed, or emerging.

In the Bond Chapter we define the types such as Government, Corporate, and Municipal and how each one is different as to risk and taxation. We describe how bonds are rated and the risks that bonds carry. Yes you can lose money in bonds. We talk about bank grade bonds and junk bonds and call features. Foreign and domestic bonds are now readily available. What percent of your portfolio should be in bonds?

In Mutual Funds we discuss the types and kinds, explore the costs of owning a mutual fund and how to select a fund that will likely do the best job for you. We look at mutual fund allocation, and management. They may be the best investment tool for the beginning investor and are the only vehicle allowed in many 401k plans.

The Annuity Chapter is filled with descriptions of the various annuity products, and how they may work for you. We discuss the various parties to an annuity contract, what it means to annuitize, and the tax implications. We explore some of the features that may be offered in an annuity contract and the associated costs. We have a word of caution with annuities as you need to have a full and complete understanding because after the “free look period” of a few days, you now are involved in a long term contract.