AAII Investor Classroom

First Steps to Successful Investing

• Balancing Your Return Ideals With the Realities of Risk
  Learning to make an educated guess as to the returns you can expect, given your tolerance for risk.
• Know Thyself: How Your Needs Will Steer Your Decisions
  Developing a personal investment profile sets you on the proper path for making investment choices that are right for you.
• Dividing Your Assets Between Stocks, Bonds and Cash
  How you allocate your portfolio among these three categories will have by far the greatest impact on your performance of any investment decision you make.
• Slicing Up the Stock and Bond Pies
  Properly allocating your assets within the major categories can reduce your portfolio risk without lowering your overall return.
• Making Your First Investments
  How to get your investment program off the ground if you are starting from scratch with little savings.
• Setting Up an Ongoing Investing Program
  Easing into the market by making automatic investments on a set schedule.

Mutual Fund Investing

• Mutual Funds by Design (What Is a Mutual Fund?)
  How funds are structured and what a fund load is.
• Grappling With Fund Risk
  Assessing your risk tolerance, and measuring volatility in a mutual fund.
• Fund Statements: What to Look For
  Which fund reports you need to read and how to interpret them.
• Fund Mechanics: Investing & Redeeming
  How to buy and sell fund shares, along with setting up a systematic withdrawal program.

Choosing the Best Fund for You

• What You Need to Know: The Nine Essential Fund Facts
  How to glean information from a fund's prospectus or profile.
• Researching Funds Through the Internet
  Corralling the wealth of free data offered on-line for quick and easy fund comparisons.
• Tips When Looking at Funds
  Answers to common questions that trip up fund investors.
• Getting to Know a Fund's Manager: Questions to Ask
  Using published literature to make a judgment about the manager of a fund you are considering.
• Breaking a Tie Between Funds
  How to resolve a stalemate when you?ve narrowed your search down to two similar funds.

Digging for Gold: What the Financial Statements Reveal About a Firm

• Snapshot of a Stock: The Balance Sheet
  How a balance sheet balances to report on the current financial position of a firm.
• Mapping Earnings: Finding the Bottom Line in Profits
  The income statement reports on one of the most critical company figures-its earnings per share.
• Show Me the Money: Tracing a Firm's Cash Flow
  The importance of knowing how company raises money and what they use it for.
• Putting the Numbers to Work: The Magic of Ratios
  Ratio analysis relies on financial statements to study the past and develop a feel for a company's attractiveness.
• Frequently Asked Questions About Financial Statements
  Reading a company's literature can still be a mystery if you don't understand the jargon.

How to Choose a Stock

• Using a Simple Worksheet to Analyze a Stock
  An introduction to the Valuation Worksheet and how to approach it.
• Collecting Basic Data on a Stock
  Where to find the numbers you need to complete the Valuation Worksheet and begin your analysis.
• Evaluating Dividend-Paying Stocks
  Using the Valuation Worksheet to analyze a prospect that is a stable, dividend-paying company.
• Evaluating Growth Stocks
  Using the Valuation Worksheet to analyze a young, growing company based on its earnings.

Investing in Bonds

• Getting a Handle on the Bond Market
  An overview of how the bond market works: who sets bond prices, where to find a bond broker, and what a callable bond is.
• Why Bond Prices Go Up and Down
  The factors that affect the price of a bond and how to protect yourself against bond fluctuations.
• Understanding Bond Credit Ratings
  Clearing up misconceptions about what a bond?s credit rating really means, and how it impacts your portfolio.
• The Ins and Outs of Bond Yield
  The difference between yield and total return for a bond, and how they are calculated.