Wall Street analysts are bullish on this stock, largely on the strength of clinical trials for its anti-CD6 monoclonal antibody, Itolizumab. Successful trials could lead to strong long-term growth.

In this article, we will take a closer look at Equillium stock. Should investors be optimistic about the future? If so, Equillium may indeed be a good stock to buy right now.

What Is Equillium Inc?

Founded in 2017 and headquartered in San Diego (La Jolla), California, Equillium is a biotech firm developing treatments for severe autoimmune and inflammatory disorders.

The company’s first potential product offering is Itolizumab (EQ001), a drug currently featured in clinical trials. And so far, the drug is showing some promise in phase 1 of clinical trials.

Leerink analyst Thomas Smith had this to say about the trials:

These results aligned with biomarker data showing that itolizumab rapidly decreased CD6 expression on CD4 and CD8 T cells. We believe these results are compelling and supportive of EQ’s plans to expand dosing into additional GVHD patients at the 0.8mg/kg and 1.6mg/kg dose levels.

As a result, Smith rates the stock as a buy and sets a price target of $18. As of yesterday, Equillium stock closed at $5.86. It has traded as high as $27.05 on the year.

What Are the Fundamentals Supporting Equillium Stock?

Equillium stock is a penny stock with plenty of upside potential. And of course, as is generally the case with biotech startups, the potential for long-term profitability is tied to the success of its initial product offerings.

But because Itolizumab is not in production yet, there is no revenue or income to show at this point in time. The good news, however, is that the company has plenty of cash to finance its current clinical trials. Moreover, the cash is funded mostly through equity and the balance sheet shows very little debt.

Equillium Inc. currently has $53.1 million of cash on hand. Meanwhile, only $13.6 million of total liabilities exist on the books, and $9.7 million of that is long-term debt.

Through increased financing and keeping its expenses reasonable, the company has been able to improve its net cash flow in each of the last four quarters.

Over the past year, the stock has a 53% gain, and with continued success of its clinical trials for itolizumab, it could see a whole lot more in the future.

Should You Buy Equillium Stock?

Biotech startups like Equillium stock are inherently risky. On the one hand, if a product hits it can lead to massive profits. On the other hand, if the product fails your investment may blow up in your face.

Wall Street analysts are currently optimistic about the stock’s future prospects. Three out of 4 analysts have rated the stock a strong buy. The fourth rates it simply as a buy.

But a bad turn in the clinical trials of Itolizumab could quickly wipe away those positive sentiments. So, like any biotech penny stock, Equillium remains a risky bet.

If you want to stay on top of currently trending stocks, be sure to subscribe to our free e-letter Profit Trends. Each edition features insights from our Chief Trends Strategist Matthew Carr.

As Matthew follows all of the latest trends in tech and biotechnology, you will receive his best tips, insight and advice when it comes to Equillium stock and other potentially lucrative investments.

The post Is Equillium Stock a Buy Right Now? appeared first on Investment U.

In this article, we’ll take a closer look at the company’s recent binding agreement to develop this vaccine, and we’ll dive into some fundamentals regarding the stock itself.

Ocugen Stock Rallies on Vaccine News

Ocugen stock’s 800% rally occurred on the news that the biopharma company is co-developing a new COVID-19 vaccine. The company signed a binding letter of intent to develop the vaccine with Bharat Biotech, an India-based firm.

Bharat’s Covaxin vaccine is already in development, and the first two rounds of clinical trials have shown some promise. The company is now working on enrollment for Phase 3 trials of its potential vaccine.

The two firms have not worked out all the details of their agreement, but it’s clear that Ocugen would hold the rights to Covaxin for distribution in the United States.

H.C. Wainwright analyst Swayampakula Ramakanth has commented…

Broad immunity targeting different components of the virus could potentially provide better protection against emerging mutant viruses, such as the one currently circulating in the UK. More importantly, Covaxin also induces comparable levels of neutralizing antibodies to those in human convalescent serum, which bodes well for the success of the ongoing Phase 3 trial in India.

It should be noted, however, that Ramakanth still rates Ocugen stock as neutral, because the final details of the agreement have not been hashed out.

The Fundamentals of Ocugen

Ocugen stock is a biopharmaceutical company penny stock that – until recently – had been trading around $0.30. However, the recent rally has bumped its price up to $2.25 as of yesterday’s close for a total gain on the week of about 650%.

That said, for a stock that has reached as high as $268 in the past five years, it has been a long fall for Ocugen. But what do the company’s current financials say about its future?

Unfortunately and most tellingly, the firm hasn’t generated any sales over the past year. This has resulted in net losses as high as $10.4 million in the third quarter of 2020.

And while the company has been able to raise some cash from stock issues, it’s bleeding cash from its pharmaceutical operations. It has seen decreases in operating cash of more than $15 million for each of the last four quarters.

So can the development of the new vaccine stop this hemorrhaging? And will it be enough to turn the fortunes of a once-promising biopharmaceutical company around?

The Verdict on Ocugen Stock

By now, you’re likely wondering if Ocugen stock is a “Buy.” Of course, nobody can know for sure, but most certainly the new COVID-19 vaccine development leaves room for optimism where there was little before.

Nevertheless, it’s still possible that the vaccine won’t pan out. In that case, it would be tough to see where the future value for Ocugen would come from.

Interested in the latest trending stocks like Ocugen, and in learning which ones may be the big winners? Sign up for the FREE Profit Trends e-letter below.

In Profit Trends, Chief Trends Strategist Matthew Carr and our team of experts provide daily stock tips, insights and analysis to help you make better decisions for your portfolio. It’s the place to get the ultimate scoop on hot stocks like Ocugen now.

The post Is Ocugen Stock a “Buy” Right Now? appeared first on Investment U.

One of the most important changes you can make to your lifestyle for early retirement is saving money. It is often easier to cut expenses than to increase your income, even if some of your major costs seem fixed.

In this article, we will look at how to save for early retirement if that’s your goal. Whether you want to retire early at 40 or even retire early at 60 doesn’t matter – there’s information here that will be invaluable in helping you achieve financial freedom.

Why Other People Can’t Find out How to Save for Early Retirement

It may seem strange to think about how to save for early retirement when so many seem unable to save for on-time retirement or even late retirement. That’s because Americans are addicted to spending – and addicted to debt.

And I don’t use the term “addicted” lightly. Our spending patterns are out of control and having massive amounts of debt has been completely normalized. Just take a look at average household debt in the United States right now…

As of 2022, average American household’s debt is at $155,622. This figure includes everything from credit cards to mortgages and student loans. Furthermore, a 2021 article revealed Generation X (ages 40 to 55) has an average debt of $135,841.

Unless you are a top-income earner, it’s going to be hard to service so much debt and invest for retirement at the same time. But to reel in our debt, we have to start reeling in our spending too.

So what are we spending so much money on? Well, everything from new houses (big ones!) to new cars (fancy ones!) to big restaurant meals (takeout only for some during the pandemic). And don’t forget the interest payments you’re making on all that debt, too.

With all that spending, how could anyone possibly find a way to save for early retirement?

Save for Early Retirement by Living Below your Means

I can tell you one thing: Figuring out how to save for early retirement is not just about cutting out that daily Starbucks drink. Even though the cliché is that millennials have no retirement money because they spend it all on coffee and avocados, this is far from the truth.

Think about it: If you want to make a dent in your spending, doesn’t reason seem to show that you should start with your largest monthly expenses, not your smallest? Of course it does.

And yet this way of looking at it is not common sense after all – many people might argue that it’s impossible to cut down on the big three expenses: housing, transportation and food.

In fact, let’s look at a breakdown of what households are spending on each of these three items in relation to the others:

• Housing: 33%
• Transportation: 17%
• Food: 13%
• Everything else: 37%.

Almost two-thirds of our spending is taken up by just three major categories!

So how can you save for early retirement by cutting down on housing, transportation and food? Let’s take a look.

Cut Your Housing Cost to Save for Early Retirement

You may be wondering how to save for early retirement if you have an enormous home. Spoiler alert: You may not be able to. Now, that’s not always true, and there are different ways to make a giant house – and even a giant mortgage – work for you.

But consider this: In 1950, the average home size was 983 square feet. By 2014, it had nearly tripled to 2,657 square feet. I assure you, families are not three times the size they were in 1950, and they definitely do not need three times the amount of home.

Owning a giant, luxurious home is a status symbol. But owning status symbols is a great way not to retire early. But here’s the good news: Houses are assets that you can sell. “Downgrading” (is it really a downgrade, though?) to a significantly smaller house that costs you much less is an option that’s always on the table.

And what if I told you there was even a way to live “rent- or mortgage-free”? I’m not kidding. And no, it doesn’t involve squatting, I promise. What I am referring to is the practice of house hacking – renting out rooms in your home or a section of a multifamily home and using the passive income to pay off your rent or mortgage each month.

Not only is house hacking entirely possible, but also lots of people do it! And remember, by completely eliminating your monthly housing payment, you just literally saved – on average – 33% of your monthly spending. And all of that money that can be socked away for your early retirement! Plus, if you own your home, you’re also building equity.

How to Save for Early Retirement by Cutting Your Transportation Costs

If you think saving for early retirement by cutting your transportation costs is impossible, think again! You know that bright red 2021 BMW you’ve been coveting? You don’t need it. It’s another wealth trap, a shiny status symbol that in no way helps you build wealth. It’s a losing investment all around.

In fact, you might not need a new car at all. In the case that you do, I highly recommend buying a pre-owned car at least 1 year old if not older. Cars lose significant value the moment they are driven off the lot for the first time. In other words, you will already be saving significant money on the front end by buying a (slightly) used car.

But what if I told you that you don’t even need a car at all? Is your mind blown yet? Of course, you may need a car right now, especially if you are using it to commute to work.

However, finding a place to live that’s within walking or biking distance to work is an incredible way to completely eliminate your car expenses each month. And not only are bikes and walking cheaper than cars, they are great for the environment (and your health), too. See, isn’t saving for early retirement both fun AND refreshing?

How to Save on Your Food Bill

Another way to save big money every month is to cut down on your food expenses. The easiest way to do this is to cut out restaurant meals as much as possible.

The average household spends $3,365 per year on food away from home.  That breaks down to about $280 per month. Spending nearly $300 per month on takeout and restaurants is a surefire way to make early retirement a much longer path.

Instead, you should focus on making as many of your meals at home as possible. If you are working in an office next year, brown-bag your lunch each day. Make dining out an occasional treat, not a habit.

The folks over at ChooseFI recommend limiting your food spending to $2 per meal. That may sound impossible, but it’s really not. There are plenty of inexpensive options and store-brand items available in the market.

Of course, if you want to be super ambitious, you may even want to try growing your own food at home. I’m not suggesting you start raising cattle – but then again…

Concluding Thoughts on Learning How to Save for Early Retirement

Saving for early retirement is possible. But the trick is to not sweat the small stuff – like those delicious lattes – and focus instead on cutting down your three largest expenditures: housing, transportation and food.

Of course, saving money is only one piece of the early retirement puzzle. Another is figuring out what to do with all of that money you’re saving. Here are some investment opportunities to put your money into in 2022.

The post How to Save for Early Retirement appeared first on Investment U.

But is Skillz stock a good investment? Or is it merely part of the recent special purpose acquisition company (SPAC) fad? In this article, we’ll take a look at the company behind the IPO and see if we can get clear on what to make of Skillz stock.

What Is Skillz Inc.?

Simply put, Skillz Inc. is a leading mobile gaming platform. In the words of founder and CEO Andrew Paradise…

We built Skillz on the founding belief that esports are for everyone, and have made significant progress toward our vision of enabling everyone to share in the future of competition. We stand at the intersection of mobile gaming and esports, perhaps the two most exciting growth opportunities of the next decade. I thank the entire Skillz team for their dedication, passion and creativity, which have led us to this incredible moment on our journey to build the competition layer of the internet.

The Skillz platform allows developers to build franchises through the use of social competition in games. This can lead to the creation of gaming franchises valued at many millions of dollars.

Skillz Inc. is at the intersection of both gaming and esports. Millions of mobile players worldwide use its platform for gaming. And each month, Skillz pays out millions to tournament winners.

Skillz currently has about 2.6 million active users devoted to its esports and gaming platform. The company went public after merging with SPAC Flying Eagle Acquisition Corp.

On its website, Skillz. Inc. hails itself as “esports for everyone.” Some of its most popular games include…

• Solitaire Cube
• Blackout Bingo
• Pool Payday
• Bubble Shooter Arena
• Block Blitz.

Skillz Inc. generates revenue through competition entry fees, brand sponsorships and in-game ads. The company is based in San Francisco and has received a number of accolades. It has been recognized as one of Fast Company‘s Most Innovative Companies and one of CNBC’s Disruptor 50. 

Skillz and the Mobile Gaming Industry

Skillz stock enters a mobile gaming industry that is currently valued at $63 billion worldwide. Experts expect this industry to grow to $100 billion by 2023.

It was every boy’s seemingly impossible dream to make money playing video games back when I was a kid. But mobile gaming and esports are now clearly huge businesses for investors.

Some of us may have thought that mobile games like Candy Crush Saga and Pokémon Go were mere passing fads, but it’s becoming increasingly clear that mobile games are bigger than ever.

Like betting on sports, betting on video gaming and esports combines the rush of the video games themselves with gambling. Could the stakes be any higher? Maybe not for players, and certainly not for investors.

Should You Invest in Skillz Stock?

By this time, you’re likely wondering if you should invest in Skillz stock. Well, that depends entirely on the outlook for the company and the esports and mobile gaming industries, and on your appetite for risk.

Currently, Skillz Inc. is trading at around $23 after opening at around $17.89. So a bit of value has been gained by IPO investors.

But given how hot esports and mobile gaming are likely to remain – as well as Skillz’s position within the industry – there’s good reason to think that the stock could continue to rise over time.

And if you’re interested in learning about stocks we may like even better than Skillz, check in with Bryan Bottarelli and Karim Rahemtulla in their free e-letter Trade of the Day.

In Trade of the Day, you will find daily insight into the hottest stocks straight from the Head Trade Tactician and the Head Fundamental Tactician of Monument Traders Alliance and its blockbuster trading community, The War Room. And be sure to subscribe to Trade of the Day right now!

The post Can Mobile Esports Company Skillz Inc.’s IPO Level Up for Investors? appeared first on Investment U.

As a result, the Starbucks (Nasdaq: SBUX) competitor from China has lost much of its value. The stock dropped about 90% from its highs in January. But is there a chance that Luckin Coffee could recover?

In this article, we will look at the latest developments in the Luckin Coffee scandal and see if there’s still any room for the stock to bounce back in 2021.

Luckin Coffee Settles for $180 Million

The Securities and Exchange Commission alleged that the Chinese coffee company participated in fraud by fabricating much of its 2019 revenue, and it seems to have underreported its 2019 net loss.

On Wednesday, Luckin Coffee settled its lawsuit with the SEC to the tune of $180 million. The Starbucks competitor agreed to pay this large sum, but so far it hasn’t admitted or denied any wrongdoing according to the SEC. Chinese securities regulators are also investigating the company.

Dr. Jinyi Guo, the firm’s acting chairman and CEO, said in a statement…

This settlement with the SEC reflects our cooperation and remediation efforts and enables the company to continue with the execution of its business strategy. The Company’s board of directors and management are committed to a system of strong internal financial controls and adhering to best practices for compliance and corporate governance.

After the scandal, Luckin Coffee was delisted from the Nasdaq exchange. Its shares plummeted in the wake of the alleged fraud, and it has been unable to recover since.

While the company was engaging in these alleged practices, the SEC argued that the company raised more than $864 million in funds from both debt and equity.

Current Stock Price and Financials

In January, Luckin Coffee stock reached as high as $51. But since then, Luckin has lost about 90% of its value on the year, devastating its investors. After its crash when news of the scandal came out in April, its share price has been hovering between $2 and $5, and the stock closed yesterday at $3.74 in over-the-counter trading.

In April, the company admitted that as much as $310 million in sales were invented by COO Jian Liu and other employees. That amounted to about 40% of projected sales.

The stock currently has earnings per share (EPS) of -$2.44. And its price-to-earnings ratio (P/E ratio) is currently at about -1.53. Given the bleak financial outlook of the company, is there any hope of a turnaround in 2021? Can Luckin Coffee stock recover?

Can Luckin Coffee Stock Recover?

In theory, it is understandable why some investors would still like Luckin Coffee’s stock. After all, the idea of “the Starbucks of China” is appealing. There are a lot of people in China. And there’s a lot of coffee to drink there. In fact, China’s coffee consumption has grown by 16% annually for the past decade.

On the other hand, Luckin is now known more for its accounting scandal than its coffee. True, the company has been keeping a low profile lately. But, in the wake of a scandal caused by lying and a lack of transparency, it’s hard to see how investors would view that as a positive only.

At the end of the day, Luckin Coffee is a high-risk stock. If the company manages a massive financial turnaround and reputation overhaul, it could possibly bounce back. But it is hard to see this as the most likely scenario.

If you’re looking to invest in some trendy stocks, there are likely much safer – and more profitable – plays out there. And nobody knows more about such plays than Profit Trends‘ Chief Trends Strategist Matthew Carr.

To learn more about other stocks we like more than Luckin Coffee stock, be sure to sign up for Profit Trends in the subscriptions box by entering your email address now.

The post Can Luckin Coffee Stock Recover in 2021? appeared first on Investment U.

Unfortunately, due to COVID-19, movie theater stocks are deeply in trouble. Box office grosses have plummeted to, well, not zero but not much better.

Disney is showing its hand: Streaming will be the future of movies. Theaters may survive but likely in a somewhat limited role. Here’s what’s going on with Disney and its stock.

Disney Investors Day Announcement Reveals Tons of New Content

Disney held its Investors Day meeting call on December 10. On the call, it discussed its slate of upcoming content development plans. And it is an exciting and massively impressive list of items.

Perhaps the most exciting and fanboyish group of new content centers around a slate of new Star Wars-related content. In the wake of The Mandalorian‘s success, it is no surprise that Disney is going full steam ahead on the Star Wars front.

But there is plenty of other content ahead, including some tied to major franchises like Marvel, FX and National Geographic. But where Disney is really going full steam ahead is with its one-year-old streaming service Disney+. And this may be the bulk of the stock’s value going forward.

According to Chairman and former CEO Bob Iger, who is now responsible for the creative direction of developing Disney entertainment content, the streaming platform will continue to focus on quality over quantity.

While the company plans to release some content in theaters in the future, according to Iger, approximately 80% of its future content will be going directly to Disney+ streaming.

The New Content Deeper Dive

More than ever before, incredible, high-quality original content is the key to streaming movie success for entertainment companies. And from the sound of it, Disney and Disney+ have quite a bit of great stuff coming up.

For instance, the slate is to include…

• Two new Star Wars projects from the creators the massively successful show The Mandalorian
• Kenobi, another new Star Wars show with both Ewan McGregor and Hayden Christensen reprising their roles from the prequel films as Obi-Wan Kenobi and Darth Vader, respectively
• A new Star Wars film by acclaimed celebrity director Patty Jenkins (Wonder Woman, Wonder Woman 1984) based on the popular video game concept Rogue Squadron
  
• Legendary Hollywood star Harrison Ford reprising his role as the daring adventurer Indiana Jones for a fifth film
• A slate of new Marvel Cinematic Universe (MCU) projects including Black Widow and Fantastic Four films based on the classic comic book characters.

With an upcoming slate of entertainment content like that, it may be hard for other entertainment competitors to keep up with Disney+. For example, AT&T‘s (NYSE: T) WarnerMedia, which seems to be having a problem keeping its talent happy this week…

The Movie Business’ Main Problem: The Box Office Theaters

As you can see, things seem to be moving along swimmingly for Disney+, especially on the streaming front. The light side of the force is strong with them.

And then you have the issue of WarnerMedia vs. Nolan: Dawn of Grievances.

In case you hadn’t heard, WarnerMedia recently announced that all box office films slated for release in 2021 will be simultaneously released on its fantastic streaming platform, HBO Max, for subscribers.

The Dark Knight and Inception director, iconic filmmaker and WarnerMedia golden boy Christopher Nolan had a thing or two to say about that.

The fallout from that may not be pretty for either (or both) Nolan and WarnerMedia. But in the meantime, both entities may need to face a stark new reality: Movie theaters may be nearly headed the way of the dodo bird.

Movies by the Numbers

While Disney+ and other streaming services continue to thrive, movie theaters have a problem. And we can see that pretty starkly in their revenues and stock prices.

The total gross of the domestic box office returns in 2020 are about $1.9 billion to date. For 2019, the total domestic box office returns were about $11.2 billion. That’s a drop-off of 82%.

So yeah, they aren’t likely to close that particular gap.

And while it is in theory possible that someday box office numbers will revert to pre-pandemic numbers and people will want to sit in massively crowded theaters elbow-to-elbow, eating stale popcorn and drinking a supersized soda while people cough all around them, I am far from convinced.

WarnerMedia is clearly preparing for big changes to last awhile – maybe permanently – in the entertainment industry. And, whether Christopher Nolan likes it or not, that’s just a reality directors and other artists will have to deal with.

Disney Stock and Movie Stocks

The success of the Disney+ platform and optimism about its future can be directly seen in investor sentiment. Disney is currently trading around $160, up from a low of around $80 at the time of the crash in March. That’s a 100% gain.

Meanwhile, AT&T’s stock has dropped this year from a high of about $39 to yesterday’s closing price of $30.42. That’s a year-to-date change of about -21%.

There’s far more going on with AT&T that’s responsible for its share price than its box office numbers, though. And I think HBO Max, with incredible content like the investment banking drama Industry and the sensational miniseries The Undoing, has a bright future ahead.

Nevertheless, the difference in investor sentiment between the two studios is quite clear. And that doesn’t even include AMC Entertainment Holdings (NYSE: AMC), which has plummeted 43% this year, from around $7.50 to yesterday’s closing price of $4.09.

The general consensus is pretty clear: The future of the entertainment industry is streaming services, not the box office – at least in the near term. And Disney+ stands to be one of the great beneficiaries.

Concluding Thoughts on Disney+ and Disney Stock

Disney+ looks to be the hit streaming platform of the near future. After all, that’s a whole lot of Star Wars they have coming. And Star Wars has meant big business since 1977.

If you like betting on the movies, you might want to consider a play for Disney stock. That said, always remember to use a position size calculator to keep your portfolio well diversified and poised for success without too much risk.

If you’re interested in learning more about which stocks will be great in the future, I highly recommend signing up for The Oxford Club’s Chief Investment Strategist Alexander Green’s free e-letter Liberty through Wealth in the subscription box. This investing guru shares his brilliant insights into the stocks you need to know to build wealth.

The post Disney+ Is Likely the Key to Future Stock Growth appeared first on Investment U.

While there are other major types of retirement plans such as the traditional or Roth 401(k) plans and the 403(b) plan, the Roth IRA remains a popular option.

In this article, we will explain further what a Roth IRA is, how it works and how you benefit from contributing to one. By the end of this article, you will know how these accounts can help you with your retirement planning.

What Is a Roth IRA?

A Roth IRA is an investment account that you can use to help prepare your finances for retirement. IRA stands for “Individual Retirement Account.” And this is exactly what this investment vehicle is.

This type of account was created in 1997 by the Taxpayer Relief Act of 1997. The chief sponsor was the account’s namesake, Senator William Roth. Its goal is to help provide tax relief in retirement planning to people who stand to benefit.

Like a traditional IRA, you can make a number of annual contributions to these accounts each year. You can contribute up to a certain limit set annually by the IRS. However, in this case, the contributions are not tax-deductible. This means there’s no immediate tax benefit to gain.

Instead, the benefit comes later on. They come when you are ready to take your withdrawals during retirement. Generally, when you withdraw your contributions and investment gains, they will be tax-free.

A Roth IRA makes a lot of sense if you expect to have a higher tax rate in your retirement years than you do now. That’s because you pay your taxes now, when you presumably have a lower tax rate, and reap larger benefits later.

How Much Can I Contribute?

The amount you can contribute to a Roth IRA varies each year. The contribution limits are set by the IRS. In 2020, you are allowed to contribute $6,000 in sum to all of your IRAs including a Roth or traditional.

However, if you are age 50 or older, you can contribute an additional $1,000 “catch-up contribution.” This is meant to further pad your retirement investments. The contributions are not tax-deductible. However, once you contribute they can generally be withdrawn tax-free in retirement.

One important thing to note, however: Contributions to your Roth IRA must remain in the account for at least five years to be withdrawn tax-free. Otherwise, they will earn you tax consequences upon withdrawal.

When Can I Withdraw From My Roth IRA?

Technically, you can withdraw from your Roth IRA anytime. However, depending on when and how you do so, you will face some taxes or even an additional tax penalty.

In general, the owner of the account may not withdraw funds before age 59 1/2 without facing a 10% tax penalty on his or her disbursement. Because this is a steep penalty, it is generally inadvisable to take early withdrawals. With this said, in a true financial crisis it may be worth doing.

The dividends, income and capital gains you earn on your investment can remain completely tax-free. Of course you must follow certain procedures for this to be the case. After age 59 1/2, you may begin taking your withdrawals from the account. However, it may often be advisable to wait longer. By using our investment calculator, you can see how much more money you could earn by leaving it invested longer.

Other Features of Note

One great thing about the Roth IRA is that you can contribute at any age. The only requirement is that you earned income during that year. And you can hold on to the account indefinitely as there are no required minimum distributions (RMDs).

There are several different ways you can fund the account. These include regular contributions (made in cash or checks), spousal IRA contributions, rollovers and conversions.

Once you fund the account, there are a variety of different investments that you can buy, including…

• Individual stocks
• Bonds
• Mutual funds or ETFs
• Money market funds
• CDs.

Of course, the riskier the asset class, the higher the returns you have the potential to reap. Particularly during your younger years, it’s usually good to fund your account largely with stocks. In addition to mutual funds or ETFs that invest in stocks. As you get closer to retirement, it often makes sense to shift into the less risky assets like corporate bonds or treasuries.

Traditional vs. Roth

So which is the better account to use for retirement: a traditional or a Roth IRA?

The truth is, everyone’s situation is different. In some instances, one makes more sense than the other. In other cases, you might benefit from both accounts together.

I checked in with The Oxford Club’s Chief Income Expert and Editor of Wealthy Retirement Marc Lichtenfeld on which account he preferred. Here are his thoughts:

The most attractive feature of a Roth IRA is that your withdrawals are tax-free. And who doesn’t love tax-free income? However, you’ve already paid taxes on the contributions. And if you’re deciding between contributing to a Roth versus a traditional IRA, remember that contributions to a traditional IRA can lower your taxable income.

So it really depends upon your specific case and whether you’d rather pay taxes now or later. The difference between your current and retirement income tax rates makes a huge difference here.

Concluding Thoughts on the Roth IRA

For many people, a Roth IRA can be a great vehicle for saving for retirement. It can also be especially useful if you are aiming for early retirement like many in the FIRE movement.

The Roth IRA is move effective when in conjunction with other kinds of retirement plans. For example, 401(k)s and taxable brokerage accounts to save for your retirement. Investing more is almost always better and you will very rarely regret it.

The post The Roth IRA: What It Is and How It Works appeared first on Investment U.

Investors clamored for a stock that has, unlike many companies, actually benefited from the effects of COVID-19 and the resulting restrictions on public spaces and stay-at-home orders.

There are some future risks for DoorDash. But the IPO reveals that investors are highly optimistic about the company’s viability in the food delivery industry. Here’s the scoop.

The DoorDash IPO Was a Hit

At its closing price on Wednesday’s IPO day, DoorDash‘s stock closed at 16X revenue, compared with Uber’s at just under 8X revenue. Uber (NYSE: Uber) and Grubhub (NYSE: Grub) are major competitors of the San Francisco-based DoorDash.

Investors have good reasons for optimism. While the company is not yet profitable, it has slashed its losses and increased its revenue massively. Between January and September 2019, the company reported revenue of $587 million and a net loss of $533 million.

In 2020, DoorDash improved those numbers to $1.9 billion in revenue and a net loss of $149 million over the same period. Clearly, DoorDash is delivering optimism to its investors.

As of its closing on the day of the IPO, DoorDash’s market valuation was about $60.2 billion. Considering its massive rise in price on the first day, investors feel that despite some risks, the company will continue to grow and thrive.

DoorDash is officially on the @NYSE! We’re proud to take the next step toward our mission of growing and empowering local economies. https://t.co/5OuZDxMN2Z

— DoorDash (@DoorDash) December 9, 2020

The COVID-19 Effect

COVID-19 has raged for nearly nine months so far, devastating both public health and the broader economy. It has created massive opportunities for delivery services to thrive, though.

While coronavirus numbers are growing like an out-of-control forest fire, people are staying home, and governments are limiting or closing restaurants and bars.

And while this a terrible situation, delivery service companies have stood to benefit greatly. According to DoorDash SEC filings, the company has acquired millions of customers as a result of the pandemic. The number of restaurants using the app, as well as its number of delivery personnel, have also increased at similar rates.

During the pandemic, the company has expanded its services. Before, it was limited to restaurant deliveries. But it now includes grocery stores, convenience stores and pet stores in its stable.

Now that so many customers have discovered the platform, it is likely that many will continue to use it more often as society returns to a more normal level of safety.

The Risks of DoorDash

However, as with all stocks, there are some risks here to be aware of. For instance, the company is being legally challenged to convert its delivery personnel from freelancers into full employees.

Using an army of freelancers is a major way the company keeps its costs down. If workers become reclassified as employees, the company will be on the book for fixed payroll expenses, healthcare and other benefits. Employee litigation is also a potential legal issue.

Another important issue to consider is DoorDash’s controversial relationship with its delivery people (Dashers) and its ability to continue attracting and retaining them.

Last month, the company settled a suit for $2.5 million for allegedly withholding tips from employees. This suit damaged the brand’s image and potentially makes hiring workers more costly.

Nevertheless, at this point, DoorDash stands to continue to perform well if all goes according to plan post-IPO. In pre-market trading, the stock was down slightly to $184.87 (-2.45%), but we will see where it ends up at the closing bell.

Closing Thoughts on the DoorDash IPO

Investors clearly wanted to get in on the stock’s IPO yesterday, a sign of optimism and potential future growth. Despite the risks, the increasingly pretty financial strength of the firm paints a potentially rosy picture of the future.

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