You can make tax-deferred contributions to qualified retirement plans, such as a 401(k). You collect tax-deferred earnings in those plans as well as in traditional individual retirement accounts (IRAs), fixed and variable annuities, and some insurance policies.

One approach stock fund managers may use to create tax efficiency is to emphasize stocks expected to grow in value over those that produce current income, or yield. Another approach is to reduce turnover, which means buying and holding stocks for long-term gains.

In general, the smaller a fund's turnover, or buying and selling, the more tax-efficient it can potentially be. That's one reason that index funds are tax-efficient. Since these funds mirror a particular index, they buy and sell investments only when the composition of the index changes.

Similarly, dividends on bond mutual funds that invest in municipal bonds are exempt from federal income tax. And for residents of the issuing state for single-state funds, the dividends are also exempt from state and local taxes. (However, capital gains on these funds are never tax exempt.)

If you have a Roth IRA, any earnings are tax-exempt when you withdraw them, provided your account has been open for five years or more and you're at least 59 1/2 years old.

When an organization such as a religious, educational, or charitable institution, or a not-for-profit group, is tax-exempt, it does not owe tax of any kind to federal, state, and local governments. In addition, you can take an income tax deduction for gifts you make to such organizations.

If a corporation accumulates 5% or more of another company, it has to report its holdings to the Securities and Exchange Commission (SEC), the target company, and the exchange or market on which the target company's shares are traded.

It can also be difficult to sell shares of thinly traded securities, especially in a downturn, if there is no ready buyer. Shares of small- and micro-cap companies are most likely to be thinly traded.

With the advent of electronic communications networks (ECNs), however, more investors are buying and selling in this way. Among the appeals of the third market are speed, reduced trading costs, and anonymity.

Most corporations have a say in what their symbol will be, and many choose one that's clearly linked to their name, such as IBM or AMZN for Amazon.com. Various letters may be added to a ticker symbol to indicate where the trade took place or that there was something atypical about the transaction.

For example, IBM.Pr would indicate that the trade involved preferred stock. A stock's ticker symbol is the same as the one that identifies it on the exchange or market where it trades, but it isn't always the one that's used in newspaper stock columns.

TICKER SYMBOLS
Single-letter elite:
F		Ford Motor Co. (NYSE)
U		US Airways (NYSE)
S		Sears Roebuck (NYSE)
Symbols for smiles:
FLY		Airlease Ltd. (NYSE)
UGLY		Ugly Duckling (NasdaqNM)
SING		Singing Machine Co. (OTC)
Simple symbols:
MSFT		Microsoft Corp. (NasdaqNM)
IBM		International Business Machines (NYSE)
EBAY		eBay Inc. (NasdaqNM)

But if you withdraw from a time deposit account before the term ends, you may have to pay a penalty-sometimes as much as all the interest that has been credited to your account. Some other time deposits require you to give advance notice if you plan to withdraw money.

In addition, because of money's potential to increase in value over time, you can use the time value of money to calculate how much you need to invest now to meet a certain future goal. Many personal investment handbooks and online financial services help you calculate these amounts based on different interest rates.

Inflation has the reverse effect on the time value of money. Because of the constant decline in the purchasing power of money, an uninvested dollar is worth more in the present than the same uninvested dollar will be in the future.

TOTAL RETURN
	Change in value
+	Dividends
		= Total return (%)
	Cost of initial investment

If you own tracking stock, you actually are invested in the parent company, since it continues to own the division that's being tracked, though typically you have no shareholder's voting rights in the corporation.

General Motors issued the first tracking stock, linked to Electronic Data Systems (EDS), in 1984. The majority of tracking stocks issued in the 1990s tracked the issuing companies' Internet businesses.

Many brokerage firms that are market makers also refer to the space they have allocated for trading as their trading floor. The same term is used to describe the trading areas in banks.

Sometimes, the exchange trading symbol varies slightly from the way the company is designated on the ticker.

When the security is offered for sale, each of these tranches is sold separately. Similarly, a large certificate of deposit (CD) may be subdivided into smaller certificates for sale to individual investors. Each smaller certificate, or tranche, matures on the same date and pays the same rate of interest, but is worth a fraction of the total amount.

Real-time trading information, increasingly available to individuals as well as institutional investors, and linked pricing systems are other steps toward complete transparency.

You buy T-bills at a discount to the face value of $1,000 per bill, but the bill is redeemed at maturity for the full face value. The difference between what you pay and the $1,000 you get back is your interest. That interest is federally taxable but exempt from state and local tax.

Because they are highly liquid short-term investments, Treasury bills are often described as ideal parking places for money you may need access to or are waiting to invest.

While Treasury bonds are federally taxable, they are exempt from state and local taxes. Treasury bonds are considered among the most secure investment in the world, since they are backed by the federal government.

Once you open a Treasury Direct account, you can buy, sell, or roll over your investments by mail, telephone, or online, avoiding the expense of buying and selling through a bank or brokerage firm. Interest paid on your investments, and the value of any securities you redeem at maturity, are deposited directly into your bank account.

Since each of the interest payments and the repayment of principal come due at a different date, TIGERs and other stripped securities give investors a choice of investments that provide lump-sum payments at different, or staggered, intervals, when the investors might need the money.

While bills are short-term issues and bonds are long-term, notes are intermediate-term securities, with a maturity date that ranges from two to 10 years.

The interest you earn on Treasury notes is exempt from state and local, but not federal, taxes. And while the rate at which the interest is paid is generally less than on long-term corporate or Treasury bonds, the shorter term means less inflation risk.

When you establish the trust, you are the grantor, and the people or institutions you name to receive the trust assets at some point in the future are known as beneficiaries. You also designate a trustee or trustees, whose job is to manage the assets in the trust and distribute them according to the instructions you provide in the trust document.