“When your dream appears as an opportunity, you must have ready cash to take it home with you.”

- Anonymous

Welcome to Money-Smarts, MsMoney.com's weekly newsletter of financial facts, features, and tools. Money-Smarts is designed to provide quick and useful information to help secure your financial future. Enjoy, and tell a friend about MsMoney.com!

In This Week's Issue:

• Market Summary for Friday, July 7, 2000
• Tips for the Week: Daily Advice to Help Get You Through the Week
• Read the Latest: Common Online Investing Mistakes
• Run the Numbers: What Will It Take to Pay Off Your Line of Credit?

Market Summary for Friday, July 7:

Close

Net Change

Percent Change

DJIA

10635.98

+154.51

+1.47%

NASDAQ

4023.20

+62.63

+1.53%

S&P 500

1478.90

+22.23

+1.58%

30-Year Bond

5.86%

-0.04

N/A

Source: Reuters

Tips for the Week: Daily Advice to Help Get You Through the Week

Monday: Consider international investments. With more than 50% of the world’s capital market opportunities existing outside the U.S., a purely domestic investment strategy can severely limit your long-term earnings potential. Learn more about investing overseas.

Tuesday: Look for imaginative ways to provide less costly care for your children-check out neighborhood art classes, tennis or music lessons, or volunteer centers. These options are frequently less expensive than childcare centers, expose your children to new interests and skills, and some providers can even arrange to pick your kids up from school.

Wednesday: With bonds, the longer the period to maturity, the greater the potential for price fluctuation. That is why long-term bonds generally offer a higher interest rate--to compensate for the greater level of risk. Learn more about investing in bonds.

Thursday: Take yourself and your financial objectives seriously, or no one else will. Financial choices that you make today will determine what you can and can’t do with all your tomorrows. Learn more about setting--and sticking to--your financial goals.

Friday: The best antidote for investment risk is to make informed decisions, take consistent action, and invest for long-term wealth. Learn more about risk reduction strategies.

Read the Latest: Read the Latest: Common Online Investing Mistakes

By Kimberly Clouse

Over the past several years, the growth of online investing has been explosive to say the least. According to a January 2000 Robertson Stephens report, close to 31 million e-brokerage accounts will be open by 2003, from just under 4 million in 1997. Moreover, Jupiter Communications predicts that online brokerage assets will grow to more than $3 trillion by the end of 2003, a sevenfold increase from $415 billion at the end of 1998. The good news is that trading and investing are becoming increasingly democratic as more people than ever are participating in the stock market. The bad news is that neophyte investors can often make mistakes as they navigate the online investing world; there is no human with whom to confirm orders or provide counsel on order selections.

Common investor missteps generally fall into three main categories:

Market Orders in a Volatile Market: Today’s market volatility is unprecedented--on a weekly, daily, and even hourly basis. When investors place stock trades as “market orders,” they are exposing themselves, often unintentionally, to these price swings. Your market order, to buy 1,000 shares at $25 per share for example, will be executed at the next obtainable price, and, therefore, the price at which a trade is executed may differ from the quote you are given at the time of order placement. If the market price is changing rapidly or if other investors’ orders placed are ahead of yours in the queue, then what you thought you were buying at $25 might cost you $28, for a total order of $28,000, not the $25,000 you planned to spend. Investors are similarly exposed when they place market orders after hours. Trade orders can be placed 24 hours a day but are only executed during standard market trading hours. So if a given stock has moved appreciably before the order is executed, an investor might very well overspend. More-->

Run the Numbers: What Will It Take to Pay Off Your Line of Credit?

Taking into consideration the amount you currently owe, minimum payments, annual fees, and interest rates, calculate how long until you repay your outstanding balance.

Questions

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