Matt Krantz is a nationally known financial journalist who specializes in investing topics. He's personal finance and management editor at Investor's Business Daily. He's also worked in the financial industry and covered markets and investing for USA TODAY. His writing on financial topics has also appeared in Money magazine, Kiplinger's, and Men's Health. Krantz is the author of Fundamental Analysis For Dummies and co-author of Investment Banking For Dummies.

Introduction 1

About this Book 1

Foolish Assumptions 2

Icons Used in This Book 2

Beyond the Book 3

Where to Go from Here 3

Part 1: Getting Started Investing Online 5

Chapter 1: Getting Yourself Ready for Online Investing 7

Why Investing Online is Worth Your While 8 Getting Started 9

Measuring How Much You Can Afford to Invest 12

Turning yourself into a big saver 12

Using desktop personal finance software 13

Perusing personal finance websites 15

Capitalizing from personal finance apps 17

Saving with web-based savings calculators 18

Relying on the residual method 19

Using web-based goal-savings calculators 19

Deciding How You Plan to Save 21

To Be a Successful Investor, Start Now! 21

Learning the Lingo 22

Setting Your Expectations 23

Keeping up with the rate of return 23

The power of compounding 24

Determining How Much You Can Expect to Profit 24

Studying the past 25

What the past tells you about the future 28

Gut-Check Time: How Much Risk Can You Take? 30

Passive or Active? Deciding What Kind of Investor You Plan to Be 31

How to know if you're a passive investor 31

Sites for passive investors to start with 32

How to know whether you're an active investor 33

Sites for the active investor to start with 34

Chapter 2: Getting Your Device Ready for Online Investing 35

Turning Your Device into a Trading Station 36

Using favorites to put data at your fingertips 37

Putting key mobile apps a touch away 38

Compiling a list of must watch sites 39

Tracking the Market's Every Move 39

Getting price quotes on markets and stocks 40

Slicing and dicing the markets 41

Your crystal ball: Predicting how the day will begin 43

Getting company descriptions 44

Keeping tabs on commodities 44

Tracking bonds and U.S Treasurys 45

Monitoring Market-Moving News 46

Financial websites 46

Traditional financial news sites 48

Checking In on Wall Street Chatter 50

Everyone is an expert: Checking in with blogs 51

Finding blogs 52

Getting in tune with podcasts 52

Taming Twitter 53

Keeping Tabs on the Regulators 54

Executing Trades 56

Searching the Internet High and Low 56

Keeping the Bad Guys Out: Securing Your PC 57

Mastering the Basics with Online Tutorials and Simulations 58

Online tutorials 59

Simulations 60

Chapter 3: Choosing the Best Account Type for You 63

Knowing How Different Accounts Are Taxed 64

Taxable accounts 64

Retirement accounts 64

Education savings accounts 65

Plain Vanilla: The Taxable Brokerage Account 66

The importance of dividends 67

How capital gains are taxed 69

The high tax price of being short-term 70

How long-term capital gains are taxed 71

When you can win from your losses 71

What to do with your worthless stock 73

Using technology to measure your capital gain 74

Measuring your capital gains if you've lost your records 77

How dividends are taxed 79

Retirement Accounts: Knowing Your 401(k)s from Your IRAs 80

401(k)s: A great place to get started 82

Managing your 401(k) plan online 83

Getting in tune with IRAs 84

Setting up an IRA 85

Going Back to School with Education Savings Accounts 86

Three numbers you need to know: 529 87

Getting up to speed on 529 plans online 88

Understanding 529 fees 89

Living in the 529's shadow: The Coverdell 90

Chapter 4: Connecting with an Online Broker 91

Finding the Best Broker for You 92

The nine main factors to consider 92

Gotchas to watch out for 94

Separating the Types of Brokerages 94

Paying the minimum with a deep discounter 95

Get more with a discounter 97

Full-service traditional 104

Avoiding Hidden Fees 106

Finding Out What Reviewers Think 108

Is Your Money Safe? Checking Out Your Broker 110

Cutting the Cord: Mobile Trading 111

Pay Attention to Where Your Cash is Parked: Money Market Funds 113

Buying Stocks and Mutual Funds without a Broker 114

Stocks: Direct investments 114

Mutual funds: Straight from the mutual fund company 116

Opening and Setting Up Your Account 116

The checklist of what you need to know 117

The checklist of what you need to have 117

Chapter 5: Getting It Done: How to Enter and Execute Trades 119

Understanding How Stock Trades and Shares Are Handled 120

Ways you can hold your investments 120

A second in the life of a trade 126

Getting It Done: Executing Your Trades 127

Types of orders 127

Costs of different orders 129

Tailoring your trades even more 129

Going off the Beaten Path with Different Trading Techniques 130

Cashing in when stocks fall: Selling stock short 130

Tracking the short sellers 131

Living on borrowed time: Buying stock on margin 132

The call you don't want to get: The margin call 135

The nightshift: Trading in the extended hours 135

Knowing Your Options: Basic Ways to Best Use Options 136

The different types of options 137

Basic options strategies 137

How to get option prices online 140

How to buy options online 141

Discovering more about options online 142

Stepping Through Placing a Trade 143

Using the brokerage's website 143

Using the brokerage's mobile app 145

Using the brokerage's PC software 146

Part 2: Using Online Investment Resources 149

Chapter 6: Why Stock Prices Rise and Fall 151

How Stocks Get into the Public's Hands 152

Step 1: An idea becomes a company 152

Step 2: The company expands and grows 152

Step 3: The company goes public 154

Step 4: The new shares trade 155

Why Stocks Move Up and Down in the Short Term 155

Tracking the market's every move 156

Getting in tune with earnings reports 157

Companies and the company they keep in their industries 162

Monitoring the big cheese 165

Where it all begins: Tracking prices of raw materials 165

Getting with the mo' 166

Mania over merger chatter 167

Why bond yields aren't boring 168

The heartbeat of the economy: Economic reports 168

What they know that you don't - Insider buying and selling 170

Knowing how investors are feeling: Tracking market sentiment 172

What Moves Stocks in the Long Term? 175

Going back to school with academic research 175

Learning from the wise men 176

Chapter 7: Connecting with Other Investors Online 179

Finding Kindred Investment Spirits Online 180

Getting the Message with Stock Message Boards 180

Stock message boards aren't for everyone 181

Understanding the types of stock message boards 181

Knowing the ulterior motives of some online stock message board members 182

Determining what exchange or market a stock trades on 184

A penny saved: Beware of penny stocks 185

Connecting with an Investment Club 187

How to find an investment club that suits you 188

Understanding the drawbacks of investment clubs 188

Social Networking Comes of Age 189

What's the fuss about Twitter? 190

Getting a read on the market with Twitter 193

Giving Facebook some face time 194

The Brave New World: Social Networking Meets Online Investing 196

Social investing sites as a higher form of stock message boards? 196

Plugging into social investing sites 197

Starting to get social: Trying social investing sites 198

Chapter 8: Measuring Your Performance 199

The Importance of Tracking Your Performance 200

Why it's worth the trouble to measure your returns 200

Why you want to measure your risk, too 201

Calculating Your Performance Yourself 202

The easiest way to calculate returns 203

An easy way to calculate returns if you've deposited or taken out money 203

The hardest way to calculate returns 205

Calculating How Risky Your Portfolio is 206

A simple way of calculating your average return 207

Calculating your risk 209

What does it all mean? Sizing up your portfolio 210

Finding other things to compare your returns to 211

Using Online Tools to Calculate Your Performance 212

Looking at online performance-measurement tools 213

Using personal finance and performance-tracking software 213

Using stock simulation and social investing sites 214

Using portfolio-tracking websites 215

Using performance-analytics websites 216

Chapter 9: Choosing an Asset Allocation 219

The Recipe for Your Online Investing: Asset Allocation 220

What's so great about diversification? 221

Zig-zag: The second element of diversification 221

Bigger isn't always better: Understanding size 223

Picking investments with the right styles 224

How rebalancing steadies your portfolio 226

How discipline can save your portfolio from getting punished 227

Using and Finding Your Perfect Asset Allocation 227

Determining your current asset allocation 228

Using guidelines 230

Picking an asset allocation based on your risk tolerance 232

Picking an asset allocation based on your goals 234

Chapter 10: Finding...