The motley fool

Shares of cloud-based customer relationship management software giant Salesforce.com have recently traded at near all-time levels, and they still appear to have plenty of room for growth.

Salesforce.com recently raised its revenue guidance for this fiscal year and offered investors a bullish outlook for its next fiscal year, forecasting revenue growth of about 20% year-over-year.

The company has been one of the main beneficiaries of the growing trend of working from home. As companies closed their offices due to coronavirus-related security concerns, they increased their spending on cloud software. Even after the pandemic, spending on remote work solutions is expected to remain high.

The company also offers artificial intelligence and data integration technology, providing tools that help businesses efficiently collect and analyze ever-increasing amounts of data from disparate sources. It’s also home to the widely used business collaboration platform Slack, which it recently acquired. Salesforce has made Slack the central platform for its Salesforce 360 ​​CRM software suite, and it should help make deals with customers and expand existing ones.

Salesforce has generated strong earnings growth for shareholders and appears to present an attractive opportunity for long-term investors. (The Motley Fool owns stock and recommended Salesforce.com.)

Ask the fool

From CR to Alpharetta, Georgia: What is a joint IRA?

The madman replies: It is a traditional or Roth IRA but owned by a partner in a marriage with little or no income in any given year.

In general, IRAs can only be funded with earned income – not with, for example, dividend or retirement income, or an inheritance. So those who may not be in the regular workforce, perhaps to care for children or parents, are usually out of luck – unless they are married. .

A married person with little or no income may qualify for a “spousal IRA” if their spouse has sufficient earned income. The contribution limit for IRAs is $ 6,000 for the 2021 tax year, plus an additional $ 1,000 for those 50 and over. So, most married couples who deposit jointly (there is an income limit) can park between $ 12,000 and $ 14,000 in their IRA for 2021. IRAs are a powerful way to save for retirement.

From BW to Coeur D’Alene, Idaho: What are leveraged ETFs?

The madman replies: These are stock-like investments that can prove to be ruinous to your wealth if you don’t understand them properly.

To step back a bit, remember that in the world of finance, the word “leverage” refers to debt. Leveraged ETFs will often follow an industry or stock index, investing in those stocks with lots of borrowed dollars in order to amplify returns. A “2X” leveraged ETF, for example, will aim to offer doubled returns.

The use of debt, however, can magnify losses as well as gains, and leveraged ETFs are meant to be held for very short periods of time; holding on longer can lead to massive losses.

Fortunately, most ETFs are not leveraged and many of them are solid investments to consider.

School of fools

At The Motley Fool, we have a very serious mission to make the world smarter, happier, and richer – in part by promoting crazy investing principles such as the top three below. (In Fooldom, being crazy with a capital F is a good thing!)

1. Buy to keep. The investment advice you will hear often is to “buy and hold”, but it suggests that you might just buy and forget about your holdings. Don’t do this unless you are investing in the stock market through low-fee index funds. With individual stocks, you should plan to hold them for at least five years, if not decades, to give them time to create all the value you want from them. But keep track of their progress so you won’t be surprised if their fortunes change.

2. Aim to build a well-diversified portfolio of at least 25 stocks to balance risk and reward. You want to own enough different stocks to make sure that one underperforming doesn’t sink your portfolio or your investment confidence, while also increasing the chances that you have one or more strong outperformers. If your money was spread evenly among five stocks and one of them collapsed badly, it would make a significant dent in your portfolio; if 1 in 25 or 30 shares collapses, the impact will be much smaller. Meanwhile, if any of your stocks skyrocket 1000% or 10,000%, it will dramatically increase your net worth.

3. Expect stock market volatility, this is normal. On average, the market goes down 10% once a year, 20% every four years and 30% every ten years, for all kinds of reasons, which often have nothing to do with the underlying value. companies in which you have invested. It’s a good idea to avoid selling on the basis of the share price alone, but sell if your reasons for investing in a business no longer apply.

You can learn much more about investing (and personal finance related topics) on our free online site, Fool.com.

My dumbest investment

From LC, online: My dumbest investment was in Netflix. I bought my shares for $ 7 and then sold them for $ 15. I thought I was a genius.

The madman replies: Well, you’ve doubled your money, which is way better than a lot of people with their stocks, especially those who invest for relatively short periods of time, as you probably have. But you are right to regret selling the shares because Netflix has been such a phenomenal long term investment.

Over the past 10 years, its stocks have gained more than 3,600%, or nearly 44% per year on average. Over the past 19 years (Netflix went public in 2002), they’ve earned over 150,000%, or 47% per year, far more than the S&P 500’s average annual gain of 11% over the same period. Netflix’s 19-year payoff is enough to turn a $ 10,000 investment into over $ 5 million. Wow.

Stop banging your head on the table, you couldn’t know 10 or 19 years ago how Netflix would work. Indeed, in 2011, after the company announced it would part with its DVD mail business to focus on video streaming, its stock fell about 75%. It was hard to imagine how much he would recover. You can’t know how your stocks will perform over the long term, but aim to hold them for a long time while tracking the development of each company.

Who am I?

I was founded in 1986, but am now a combination of several fitness brands including Bowflex, Schwinn and JRNY. (Schwinn dates back to the late 1890s, making successful racing bikes in their early days and introducing exercise bikes in 1965.) Based in Vancouver, Washington, I raise over $ 700 million a year and aim for $ 1 billion by fiscal 2026. I recently sported a market value of almost $ 270 million. I offer products such as ellipticals, home gyms, indoor bikes, treadmills, and all-in-one adjustable free weight systems, as well as the JRNY fitness app. Who am I?

Can’t remember last week’s trivia question? Find it here.

Trivia response from last week: Bridgestone