For added effect, here is a calculator: https://www.offtopic.co.za/finance/tools/annualised-growth-calculator

---------------------------

Going to Google Finance and querying your favourite ETF or share and seeing it grew by 150% over the last 10 years is awesome! Why? Because 150/10 is 15% growth on average every year, right? No... unfortunately not. The 150% over 10 years is compound growth. So how do you work it out?

Step 1: First, you need the end value of the stock (in cents). Let's say R25.00 which is 2500. 

Step 2: Then you need the starting value of the stock: R10,00 (or 1000).

Step 3: Get the year fractional value of 1/[years]. So in this example, it will be 1/10 or 0.1

Step 4: Subtract the starting value from the current value and divide that by the starting value:

(2500 - 1000)/1000 = 1.5 (this we'll call your return rate)

Step 5: Now add 1 to the return rate and raise it by the year fractional value (calculated in Step 3) and subtract 1 from the result:

((1.5+1)^0.1)-1

Simplified it reads: (2.5^0.1)-1

Simplified some more: (1.0959)-1

And the result: 0.0959 (your annualised growth percentage). 

If you struggle to read it, multiply the number by 100: 9,59%

In Summary: 

Let's use real data - STX40 between 2 Jan 2004 and 30 Dec 2016 (13 years):

Starting value: 960

End value: 4382

Year fraction: 1/13 = 0.077

(4382-960)/960 = 3.56

((3.56+1)^0.077)-1 = 0.1239

Annualised growth: 12.39%

We see a lot of questions on forums about how to start investing, what to invest in and it is almost always met by a miriad of answers. From hiding the money under your bed, to using your TFSA to save for a car to FOREX.

Truth is, before you invest even one cent there are a bunch of boring and possibly time consuming stuff you should take care of, and this is definitly not what most want to hear. Investing in shares and "playing the stock market" is the last thing on the list to do and it is a very broad subject within itself. Anyway, here are a few things you should consider doing:

1. First Pay of your bad debt. We're not talking cars or homeloans but rather credit cards, overdrafts and personal loans.

2. Then Get insurance. This includes stuff like income protection to make sure you still have a salary if you should lose the ability to work.

3. Build up an emergency fund. You should build up a large enough fund so that you can live of it and cover all your monthly expenses for 5-6 months. You can save this money in a 32 day account or something similar that gives you fairly easy access to it, but still gives you a reasonable interest rate (you want to try to keep up with inflation at the very least)

4. Now you can invest and at this point it is probably best to go see a financial advisor (make sure they are registered: http://www.fpi.co.za/FPI_Consumers/Find_A_Financial_Planner_Basic.aspx). You don't have to follow their advise but they do know a lot more about this stuff than most so it's worth meeting one regardless.

I would like some feedback please. I have created a Home Loan calculator infused by  FIRE .

You can check it out here https://www.mymoneytree.co.za/calculator/home-loan/

What is it about?

-  Debt free living! How much do additional payments help me to become debt free?

Thanks

Here’s how it works

Months are assigned a number from 1-12 
Jan = 1
Feb= 2
Mar= 3 
And so on to Dec = 12

We then have a multiplier lets 2 and an example. how this then works is you multiply the multiplier by the months’s respective value i.e 2 in the case of Feb.
So Feb would be 2 * 2, then you multiply the results by Rands you want to start with, could be for now lets use R100. 

So in total you would have 
Jan = (1 * 2) * R100= R200
Feb = (2*2) * R100 = R400
Mar = (3*2)* R100 = 600

And so on till Dec = (12*2)*R100= R2400
In total you would then save R15600 over the 12 months

Whats cool about this is you can change the “Rands” value and the “multiplier” value to suit your goals and afffordability

Examples
Multiplier = 0.5
Rands= 50
Jan = (1 * 0.5) *R50 = 25
Feb = (2 * 0.5) *R50 = R50
Mar = (3 * 0.5) * R50 = R75
…… Dec (12 * 0.5) *R50
Total = 1950

Last example
Multiplier =3
Rands= 200
Jan = (1 * 3) * R200 = R600
Feb = (2 * 3) * R200 = R1200
Mar = (3 * 3) * R200 = R1800
… Dec = (12 * 3 ) * R200= R7200

So depending on where you are in life financially you can start snow balling into higher savings rate. From small amounts to big amounts.

What this guide is about

This guide will show you a step-by-step system, which any parent will be able to follow. By the end of this book, you will know how much tertiary education will cost in the future; how much you need to save at each life-stage and you will have an automated investment strategy done and dusted.

# Chapter 1

We look at local and international universities. Their tuition fees now & in the future.

# Chapter 2

What is your number? We figure out how much you need to save monthly to send them to university stress free.

# Chapter 3

You will open an investment account (with as little as R500) and show you a set-and-forget automated child education investment strategy.

# Chapter 4

What not to do.

====================

Update 20 November - Chapter 1 released

When you look up a stock quote, there a variety of numbers, prices and diagrams that will appear. Understanding what they all mean will help you make an informed decision when purchasing a stock.

Learning about stocks and how they work is essential to achieving strong investment returns and will allow for significant financial advantage.

Here is the elements of a quote page you need to read stocks:

It is important to use a website that can provide all of this when looking up a stock. I would suggest https://za.investing.com/equities/ or https://www.google.com/finance as both these options are free. 

Tip: The investing.com app also has a very nice Watch-list function and provides all the info needed to read a stock as well.

1. Last Price
   The most recent price that the stock has traded at. The last price, however, is not the price you will be paying for the stock.
   
2. Bid
   The highest price a buyer is currently willing to pay for a stock.
   
3. Ask
   The lowest price at which a seller is currently willing to sell the stock at. When placing a market order, you are buying or selling a stock at the best available price.
   
4. Today's Change
   The change in price (and the percentage change) compared to yesterday's closing price.
   
5. Previous Day's Close
   This is the price of the stock for the last trade of the previous day.
   
6. Today's Open
   The first price at which this stock traded when the markets opened this morning. Note that stocks do not open at the same price that they closed at the day before due to after hours trading.
   
7. Volume
   This indicates the number of shares that have traded hands today. Some stocks may trade millions of shares each day, and others only trade a few hundred or even zero (the higher the volume, the more liquid the stock is).
   
8. 52 Week High
   This is the highest price the stock has traded at during the last 52 weeks.
   
9. 52 Week Low
   This is the lowest price the stock has traded at during the last 52 weeks. The 52 week high/low allow you to compare the current price to its 52-week range.
   
10. Charts
    Stock charts come in a variety of formats and have a whole investing technique based around them. They all track pricing data, usually the OHLC (open, high, low close), but they can display this information in different styles (lines, bars, candlesticks), different date ranges (day, week, month, year, 5 years, 10 years) and other information like volume, moving averages and dozens of other indicators.
    
11. Annual Dividends
    The amount, in dollars, the company will (but not obligated) pay to shareholders on a regular basis (usually monthly or quarterly).
    
12. Annual Dividend Yield
    This is an important measure of return of the stock and is calculated by dividing the annual dividend amount by the current stock price. If the stock is at $10 and the company pay out a cash dividend of $0.50 per share, then the annual dividend yield is 5%.
    
13. EPS
    Displays the company's earnings (profit) per share. It is calculated by dividing the company's most recent annual income by the number of shares outstanding.
    
14. Market Cap (aka Market Capitalization)
    Is the total dollar market value of all of a company's outstanding shares. Market cap is calculated by multiplying a company's shares outstanding by the current market price of one share. This figure determines the company's relative size.
    
15. Price-Earnings Ratio (P/E)
    Is the ratio for valuing a company and measures its current share price relative to its per-share earnings.
    
16. Beta
    Is used to measure the volatility of a stock as compared to the market as a whole. A beta of 1 means the stock moves up or down more quickly than the market overall; a beta between 0 and 1 means the stock doesn't move as much as the market, and a negative beta means the stock moves in the opposite direction of the market.
    

When you post a new thread please make sure that your post is:

• Factual
  
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Please do not copy paste any data from another source without attributing their work.

When formatting your post provide it in a step based format where it makes sense:

 

How to make awesomesauce popcorn the lazy way

 

Step 1: Buy popcorn from shop

 

Step 2: Throw popcorn - bag and all - into microwave

 

Step 3: Set that bad boy's timer, hit the start button and wait

 

Step 4: Once done, cover popcorn with buttery spiced goodness and NOM!

 

k thx baai!