Stocks

Graphic: Growth of a Retirement Account From the Age of 25

Saving is always important. It is considered a good practice to consistently set aside part of each of your paychecks when you are young to have money later. It is equally important to continue saving even after you grow older. As This chart from Business Insider shows, there are major differences between individuals who not only start to save money early on, but continue to save money throughout their career.

Graphic: Growth of a Retirement Account From the Age of 25

A twenty-five year old who saves five thousand dollars annually between the ages of twenty-five and thirty five is expected to have a nest egg of one million dollars by the age of sixty five.

A person who starts saving from age thirty five will have considerably less at five hundred thousand or less, but will still have a good cushion for retirement.

Saving early can actually turn into earning later on. Simply this is because the longer investments have to mature, the higher the return they will have. On average a person who only saves and invests $5,000 annually between the ages of 25 and 35 will actually have more money than someone who starts saving at the same rate from age 35 to 65.

2014 Looks to be the Most Active IPO Market Since 2000

After a peak of IPO activity at the end of the 20th century, we could be seeing a new trend of rising IPO activity caused by a combination of economic turnaround and a plethora of companies ready to go public. IPO activity has mimicked general market trends over the past decade and a half.

2014 Looks to be the Most Active IPO Market Since 2000

In 2000 US IPO activity experienced a surge that nearly doubled the average rate, therefore there were about eighty three IPOs in that year. Conversely, the mid 2000s and the year 2009 showed a sharp decrease in IPO activity. Numbers fell from an average of forty to ten and below. In 2009, there was only one IPO registered.

Currently we are seeing another rise in IPO activity as markets rebound from the Great Recession. Possibly we are also seeing companies that would have gone public earlier filing for IPOs now because of higher investor confidences and a more certain economic future.

Grpahic: Number of IPO’s With 100%+ First Day Returns by Year

In 1999 IPOs had a successful run, where one hundred and eighteen IPOs were able to produce gains on their very first days.

Number of IPO's With 100%+ First Day Returns by Year

In 2000 that number had decreased almost by half. Eighty four IPOs made gains on their debut.

The numbers experienced a sharp drop from the next year onward.

As noted in the chart above, which is a bar graph showing the numbers of IPOs which made gains on their first day, from 2000 to 2012, there was drought of immediately successful IPO first day gains. For this twelve year period, the biggest number of IPO gains was in the single digits, however, the average rate of IPO first day gains was zero, for that entire period.

IPOs experienced a sharp rise in 2013 when a whopping six IPOs made first day gains. In the next year, that number dropped down to four.

However these two years, 2013 and 2014 were the most successful years for the fourteen year period. These success may be a sign of some things to come as we see more established startups filing for IPOs as developed companies, and perhaps it also has something do with a general economic turnaround.

Chart: Average Commission Per Share on the New York Stock Exchange Has Never Been Lower

While at first glance, it might seem that stock brokers aren’t making quite as much as they used to, a closer look at the chart below courtesy of Deutsche Bank reveals how well they’ve adapted and profited from the evolving modern market.

Average Commission Per Share on the New York Stock Exchange

Over the twenty three year period, between 1983 and 2003, the average commission has fallen nearly five-fold, while the volume of traded shares has gone up by nearly 100 millions shares a year. So while there is plenty of opportunities to take a piece off the top for traders, they aren’t taking nearly as big a bite as before. Their business model has pivoted away from the high fees imposed on a few investors, and more toward a volume-based nibbling of a much much larger pie. As more shares and more investors enter the market, the fees may keep trending lower, while the profits for traders will most likely continue to rise with the increased volume.

Impact of US CEO’s on Companies Has Never Been Higher

The image describes the positive impact of CEOs on businesses for twenty year rolling periods. The time period used is 1950 to 2009 — a period of fifty nine years. The scale used indicates year and impact in percentage.

Impact of US CEO's on Companies Has Never Been Higher

At first glance, it appears that CEOs have had a huge impact on the business market, with their contributions seemingly taking up more than half of the graph, but closer inspection proves differently.

Actually, the CEO contribution to business improvement has been at an unsteady rate of ten percent for the six decade time period.

For the first thirty years, CEOs have contributed about ten to fifteen percent impact, starting from 1950 to 1980. For the most part, the CEOs have contributed to the lower range of the ten to fifteen percent frame, with an interesting surge for the last four years of the first half of this For the last four years of this period, CEOs made impact of fifteen percent or higher. A significant increase from the last twenty-six years.

From 1980 to the end, however, CEO impact was significantly raised when compared to the first half. Whereas they had previously made almost minimal impact — less than five percent impact for thirty years, CEOs initially began making about fifteen percent impact or slightly more for the first fifteen years and then twenty percent or near to twenty percent more impact after that.