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10 Investments You Should Know

10 Investments You Should Know

    It’s impossible to miss the fact that stocks, real estate and bonds all make for decent investments (at least most of the time). But there are so many different investment options, most of which get minimal marketing. If you want to take a look at a wider variety of options, you should be able to at least tell an American Depository Receipt apart from a Convertible Security. There are about twenty investments that any investor should at least be familiar with and the ten listed below are the first half of that list.

    1. American Depository Receipt (ADR)

    ADRs are traded on U.S. stock markets just like regular stocks, but they actually represent shares in foreign corporations. An ADR is issued by a U.S.-based bank or brokerage, which buys a large number of shares from a company based outside the U.S. Those shares are bundled into groups and then resold; they are usually labeled with a ratio representing how many shares a particular ADR represents. The sponsoring bank collects detailed financial information about any company whose shares it resells. ADRs are a relatively simple way to invest in foreign companies and avoid the administrative and duty costs of international transactions. Other countries besides the U.S. have depository receipt opportunities available.

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    2. Annuity

    Annuities provide set payments at regular intervals to their owners. You can typically purchase an annuity through an insurance company, and you’ll have several options. An annuity can either be immediate or deferred: with a deferred annuity, you will not begin receiving payments for a certain period of time. Deferred annuities are often contracted for life — they’re set up so that as long as you live, the insurance company will send you a check at a regular interval. Annuities are also either fixed (the payments are set) or variable (there is a guaranteed minimum payment, as well as payments based on the performance of an annuity investment portfolio.

    3. Closed-End Investment Fund

    A closed-end fund issues shares that are traded just like stocks but are actually closer to mutual funds in the way the are managed. Closed-end funds hold portfolios of securities — usually securities that meet very specific criteria (i.e. come from particular industries). These fund are actively managed and may hold a few investments in stocks or bonds in order to diversify, but because of their focus on particular sectors, closed-end fund issues are not considered diverse. Some closed-end funds offer dividends.

    4. Collectibles

    Collectibles can be pretty much any physical asset with a value that increases over time. While most people consider fine art, stamps and similar purchases to be collectibles, there is no strict definition that includes or excludes a particular asset. The greatest drawback to collectibles is the fact that collectibles offer no income, unlike many other investments. However, a collectible’s appreciating value often outpaces inflation.

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    5. Common Stock

    Common stock is what most of us think of when we hear the word stock: a share of ownership in a particular company. It entitles you to a portion of the company’s profits as well as voting rights. The majority of stocks traded today are common stocks. While the benefits associated with owning stock can be great, it is a relatively risky investment. If a company that you own stock in goes bankrupt, as a common shareholder, you won’t receive money until the creditors, bondholders and preferred shareholders have all been paid off.

    6. Convertible Security

    Convertible securities are either preferred stock convertibles or convertible bonds. While you would purchase a convertible bond just as you would purchase a normal bond, you would have the opportunity to convert it into common stock in the company that issued it. Depending on the terms of the convertible bond, also known as the indenture, the bond could convert into a significant number of shares. Convertible bonds do provide a small amount of income, but the real value is that the bond can be converted into common stock.

    7. Corporate Bond

    Corporations issue bonds in order to raise money: when you buy a corporate bond, you’re essentially loaning a corporation money for the length of the bond. Not only will the corporation repay you the full face value of the bond (and your loan) but it will also pay you a coupon — a predetermined interest rate paid out every six months. Corporate bonds are more lucrative than government bonds, but they are also riskier.

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    8. Futures Contract

    A futures contract is a commitment to either deliver or receive a specific quantity of a commodity during a specific month at a specific price. Most futures contract are closed out before the expected delivery date and while they can be very risky, futures contracts can also provide for a simple way to manage price risks. They can provide impressive profits, due to their higher risk factors.

    9. Life Insurance

    While life insurance may not seem like an investment on the surface, it provides a return on your monthly payments. No matter how long you may have been paying for a life insurance polity, its value is set. It’s a relatively low-risk investment because insurance is heavily regulated by the government.

    10. The Money Market

    Through the money market, you can buy fixed-income securities, primarily short-term securities that last less than a year. Unless you are able to deal in the very high denominations that most money market securities are sold in, you will likely have to purchase these securities through a money market mutual fund or bank account. Returns on money market investments are highly dependent on the current interest rate and are considered low risk.

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    Check back on Thursday for the other ten investments that you should know.

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    Last Updated on February 13, 2020

    What Is Speed Reading and How to Successfully Learn It

    What Is Speed Reading and How to Successfully Learn It

    Too much to read, too little time! Don’t you wish you could read faster without compromising your knowledge intake? This is where a valuable learning technique comes to the rescue: speed reading.

    Speed reading is the top skill to learn in 2020. Read on to find out all about this amazing technique!

    What Is Speed Reading?

    On average, an adult can read somewhere between 200 to 300 words per minute. With speed reading, you can read around 1500 words per minute.[1] Yes, that sounds impossible, but it is true.

    In order to understand how this skill works, you first need to know how the reading process works inside a human’s brain.

    The Reading Process

    The first step is for the eyes to look at a word. This “fixation” on every word takes around 0.25 seconds.

    Next, the eye moves on to the following word. It takes 0.1 seconds for the brain to move from one word to the next. This is called “saccade.”

    Usually, a person reads 4 to 5 words or a sentence at once. After all the fixations and saccades, the brain goes over the entire phrase again in order to process the meaning. This takes around half a second.

    All in all, this allows the average person to read 200 to 300 words in a minute.

    Speeding up the Process

    The concept of speed reading is to speed up this process at least 5 times. Since the saccade period cannot be shortened any further, speed reading emphasizes quicker fixations.

    To accomplish this, scientists recommend that the reader skips the subvocalization: when the readers actually say the word in their mind, even when reading silently.

    Basically, speed reading is the technique of only seeing the words instead of speaking them silently.

    Do not confuse this with skimming. When a reader skims through a text, they skip the parts that their brain considers to be unnecessary.

    You may skip important information in this process. Moreover, skimming does not allow the brain to retain what has been read.

    Why Speed Read?

    Speed reading is not just quick, but also effective. This skill saves a lot of of time without sacrificing information.

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    Also, it has been proven to improve memory. The brain’s performance improves during speed reading, which allows the reader to remember more information than before.

    Since speed reading stabilizes the brain, the information is processed faster and more efficiently.

    Believe it or not, this technique leads to improved focus, too. As the brain receives a lot of information during speed reading, there is far less chance of distraction. The brain focuses solely on the job at hand.

    Since the brain is, after all, a muscle, the process of speed reading acts as an exercise. Just like the rest of your muscles, your brain needs exercise to grow stronger, too.

    A focused brain means improved logical thinking. As your brain gets used to receiving and organizing so much information so quickly, your thinking process will become faster.

    As soon as a problem is thrown at you, your brain will quickly put two and two together. You will be able to retrieve stored information, figure out correlations, and come up with new solutions, all within seconds!

    Still not convinced? Read 10 Reasons Why You Should Learn Speed Reading

    Greater Benefits

    With a healthier brain, you can expect better things in other parts of your life, too. A boost in self-esteem is just one of them.

    As you begin to understand information at a faster pace, you will also begin to figure out more opportunities all around you.

    With the ability to deeply understand information in a shorter period of time, your confidence levels will quickly grow higher.

    Moreover, all the aforementioned benefits will relieve you of stress. You will manage your readings in lesser time, your brain will be healthier, and you will feel so much better about yourself.

    With all these advantages, your emotional well-being will be healthier than ever. You’ll feel less stress since your brain will learn to tackle problems efficiently. Speed reading will lead to a relaxed, tension-free lifestyle!

    How to Learn to Speed Read

    Speed reading is a superpower. Fortunately, unlike other superpowers, this one can be learned!

    There are different techniques that can be used to master this skill. Opt for the one that best suits your learning style.

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    1. The Pointer Method

    The person who is credited for popularizing speed reading, Evelyn Wood, came up with the pointer method. It is a simple technique in which the reader uses their index finger to slide across the text that they’re reading.

    As the finger moves, the brain coherently moves along with it. It is an effective technique to keep the eyes focused where the finger goes without causing any distraction.

    Readers have a tendency to back-skip. The pointer method prevents this from happening, thereby saving at least half the reading time.

    2. The Scanning Method

    In this technique, the reader’s eyes move along one part of the page only. This can be the left or right side of the text but is usually the center since that is the most convenient.

    Instead of pacing through the entire text from left to right, the vision shifts from top to bottom.

    This method involves fixation on keywords such as names, figures, or other specific terms. By doing so, the saccade time is minimized.

    3. Perceptual Expansion

    Generally, a reader focuses on one word at a time. This technique, on the other hand, encourages the brain to read a chunk of words together. In doing so, this method increases the reader’s peripheral vision.

    Here’s the thing: even though the fixation time remains the same with perceptual expansion, the number of words that the eyes fixate on increases.

    So basically, the brain receives 5 times more information within the same amount of time.

    This technique is the hardest to master and takes the most time to learn. You’ll need help from speed reading tools in order to practice the perceptual expansion method.

    However, once you master it, this technique will offer you the fastest reading pace with the maximum knowledge intake.

    The Best Speed Reading Apps

    The easiest tool to aid any process in any part of life these days is your smartphone.

    You can use mobile applications to learn speed reading on the go. It has been proven that regularly practicing speed reading is the fastest way to learn this skill. [2]

    Here are a few great options to look into:

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    1. Reedy

    If you own an Android smartphone, you can download Reedy to your mobile. Otherwise, get the chrome extension on your laptop to enjoy speed reading with Reedy.

    This app trains readers to read faster by displaying words one by one on the screen. Instead of having to go through lines or long texts, Reedy prepares the user to focus on one word at a time.

    Although this isn’t an effective method to learn speed reading long texts, it is a great way to start.

    Once your brain gets used to the idea, you can shift to another app to train speed reading sentences or longer texts.

    2. ReadMe!

    Whether you’re an android or iOS user, you can take advantage of the ReadMe! application. This app even comes with some e-book options to practice speed reading on.

    Start by choosing your desired font size, color, layout, etc. Other than that, there are different reading modes for the user to choose from.

    If you want to practice reading sentence by sentence or in short paragraphs, you can choose the focused reading mode.

    The beeline reader mode changes the color of the text to guide the eye to read from the beginning to the end at a certain pace.

    Lastly, there is the spritz mode in which the app focuses on chunks of words at once. This controls the reader’s peripheral vision. However, this mode is not fully available in the free version of the app.

    3. Spreeder

    Spreeder is available on both iOS and Android. However, users may also gain benefits from Spreeder’s website. This application lets the reader paste in any text that they would like to speed read.

    Starting off at a rather low speed, the app flashes words one by one. Gradually, as the user becomes more comfortable, the speed increases.

    Slowly, the user is trained to speed read without having to skip any words.

    This app is different from the rest because it tracks the user’s reading improvements, recording the overall reading time and speed.

    The progress and improvement are tracked in order to motivate the user to perform even better.

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    Adjustable settings, such as the speed of the text, background color, etc. are in the control of the user.

    The Controversy Surrounding Speed Reading

    Truthfully, speed reading does sound too good to be true. It’s hard to believe that it is humanly possible to attain such a fast pace in reading without compromising the quality of information you receive.

    Perhaps as a result, there are people who do not trust the process of speed reading. They believe that when you read through a text at such a high speed, you cannot comprehend the information successfully.

    According to these people, your brain is unable to process information at the speed that you’re reading, and so, they regard speed reading as problematic.

    It is true that speed reading will be of no use if you do not understand the text you’re reading, no matter how quickly you did it.

    Similarly, if you were to read slowly and still not retain or understand the information you read, that would be useless, too.

    However, there a few factors to consider here. When reading at a normal pace, there is enough time in between every step of the process for the brain to get distracted.

    Conversely, speed reading leaves behind no time for the brain to focus on something else. It is unlike skimming. No part of the text is skipped, which means that the brain receives every single bit of information.

    Conclusion

    Keeping all of this in mind, speed reading cannot be labeled a hoax or a failure. Science has backed up this technique, and numerous readers have been using this skill to improve their learning ability.

    At the end of the day, it is your decision whether or not you want to trust this process.

    However, if you decide to take advantage of the opportunities speed reading provides, you will find a world of possibilities opening up to you.

    We live in a fast-paced world. Consuming information faster will help you keep up with that pace and find further success.

    Speed Read Like a Pro!

    Featured photo credit: Blaz Photo via unsplash.com

    Reference

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