I try not to trade very much. My last purchase was a block of FXY on August 4 right after the Japanese govt intervention. I have been accumulating it since late 2009. I hold almost no equities right now, but will probably buy some next year if the downturn in that market continues.
Early Retirement Extreme Forums » Money Questions
Investments Trade Log
(366 posts)-
Posted 1 year ago #
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NGG
Does anyone own this? Anything "funny" to report in terms of tax accounting, dividends paid out in shares, and other spurious hassles?
Posted 1 year ago # -
NGG: Don't own it, but the only tax catch I can spot is that maybe there are some foreign taxes that will be withheld.
Posted 1 year ago # -
Wouldn't that operate like any other UK stock in that since we have a tax treaty with the UK, nothing would be withheld? I thought I had looked into DEO once and that is what I found.
Posted 1 year ago # -
Should be a few interesting dips today. I've been waiting to pull the trigger on CAT and JPM. I think today might be it.
SAP would be a nice purchase on a dip. I don't own it for personal reasons, but I would have added it this month if I could have.
Is anyone buying anything right now? (except gold?)
Posted 1 year ago # -
I was buying INTC during August.
In general, I'm waiting for Tuesday to roll around before deciding to buy back into mREITs. They've been falling in anticipation of a plan that helps underwater mortgagees.
Posted 1 year ago # -
if I had any skin in the game, I'd be long FXF and short NFLX.
Posted 1 year ago # -
I was holding some money (half my money net worth - that is still little) in a brazilian blue chip. These have had a significant fall because of some money the company spent, two weeks before all the markets began to fall. I was expecting the market to fall soon, but I thought it would happen more to the end of the year. Then I bought the stocks thinking I would have time to recover and then sell. Then I saw that part of my money to shrink by 16%. As it was a reliable blue chip, I held them tight. I wasn't determined to loose no money. Then as the market here in Brazil was recovering a little bit at a time, i put an order to sell at the same price I bought them. I didn't want my money to be stuck there for too long, as I'm waiting for the markets to fall much more than this at some time in the next months. Then the day before yesterday, Brazil central bank announced that it was gonna cut the official interest rate from 12.5%/month to 12%, predicting some recession on the global markets. The stocks I was holding went up 7% in a day, and my order to sell was completed. Everybody was optimistic. I even regret a little that I didn't put a little higher price on my order. But at least I've got the dividends and sold them for the same price. The next day (today), the optimism is over in Brazil and the stocks are down again, including my former blue chip. Uff... Sold just in time. I know this kind of thing is not news for you, but that was my first experience with stocks. Now I'm gonna keep it in cash for the time being. As the interests rates are still high (government trying to stop inflation), I can get around 3 to 5%/year over inflation (after taxes). The other half of my money is in treasure direct, yielding me 6.6% over inflation/year (before taxes - or around 5% after) until 2015. Now I'm gonna increase my cash position as much as I can (still need to spend some money on the house I just moved in), waiting for the real "blood on the streets" to come. I'm not brave enough to buy gold at this time (too late I think).
This little of emotion motivate me enough to start reading the book Man, Economy and State as recommended here.
Posted 1 year ago # -
Check out this classic exchange over at another website in the comments. I thought it was funny. This guy Mike would not listen to a valid argument and would not be shaken in his belief that stocks will hold up forever. I think Jacob eventually just gave up on him.
Maybe it will be people like this who will keep buying in, while the boomers cash out.Early Retirement Extreme
At some valuations, the so-called long term may be long indeed. Most people have investment horizons of 30-40 years only. That’s not a long time. By assuming historical returns, you’re assuming that the next 30 years is going to be a repeat of the last 30 years. That’s not very likely. Given that the US is now in a Japan-like conditions, I suspect a higher return may be earned from a combination of gold (to cover inflation) and long term bonds (or consumer staples/utilities if you must be in equity) (to cover deflation). The stock market will be going nowhere or down.2 Mike Young
Thanks for the comment. First of all, 30-40 years IS rather long. I’m not assuming the next 30 will be like the last 30, I’m assuming it will be like the last 70. That’s included going through many terrible and great times. To say with certainty that the stock market will be going nowhere or down over the next 30 years is quite a stretch. That will most likely be the case short term, but to assume that gold will continue to be a good investment when it’s at a record high right now doesn’t make much sense either. If our entire goal over the next 30-40 years is to just cover inflation, then no one is going to be able to retire. I just don’t know of any other place, where there is historical perspective, that will have a potential to produce the gains stocks have. I don’t sell any of this stuff, so I have no dog in the fight. I am just taking an educated risk that stocks will recover just like they always have. But, you do make a great point, that all of it is a risk: there are no guarantees. Thanks again for your input.3 Early Retirement Extreme
From 1905 to 1942 US market returns were zero. That’s 37 years of going nowhere. Compared to that, 30-40 years is NOT long. If you have such an interval of zero returns, it will impossible to recover from it because you can’t invest for 70 years unless you plan to keep working until age 100.Also, if you take out the large drop in interest rates which have been driving equity from 1983 onwards, that is, only consider historical returns up to 1983, stocks don’t look so hot “in the long term” anymore. This is important, because interest rates can’t go much lower than they already are. Hence there’s no similar drive left.
Compared to stocks (not devalued cash), gold is still 40% undervalued and not at a historical high.
4 Mike Young
Are you suggesting to put all retirement investing into gold? It appears so, which goes against any expert I know of. Smart Money Magazine still suggests being heavily invested in stocks if you are a young couple. They also just put up an article suggesting 2% of your portfolio into gold is sufficient, with 5% being “gutsy”. Kiplinger’s also suggests that stocks are still a good option: see http://bit.ly/nYjvTk and http://bit.ly/r4e9N5. I’m just curious, do you sell gold or something? I’ve yet to hear or read anyone with any credibility suggest that people (even close to retirement, not to mention decades before) get out of the stock market. Just not sure where you’re coming from here.Posted 1 year ago # -
Funny. Makes me feel alien.
Posted 1 year ago # -
Not sure anyone cares (and I swore I would take the week off), but I have added to JPM and F. I will also buy (if I get the chance) SPY @113.50, HNZ @50.50 and DKS @32. I am considering ignoring my personal rule to avoid tech and buy SAP @ $50.
And God help me, if AIG gets much closer to its 52 wk low I'm in.
Posted 1 year ago # -
"From 1905 to 1942 US market returns were zero."
Is this with reference to price appreciation without factoring in dividends?
Posted 1 year ago # -
LOL, "Smart Money Magazine" -that settles that.
Posted 1 year ago # -
JOhnnyh- I had the exact same reaction when I read the smart money magazine line!
I also just executed some big ass trades (like buy and sell me a few times over big) when my dad asked me to rebalance him from all cash into the pp. Scary, and I'm still worried everything will crash and burn, but kinda fun too.
Posted 1 year ago # -
That's cool you helped your dad. I think I'd be too nervous to handle someone else's money.
Is the PP really holding up? I'm having trouble figuring out how to account for our 401K in the allocation (it's limited to a handful of mutual funds). It's more than 25% so I'm not sure how I could do it.
Posted 1 year ago # -
@dragoncar - I think $50k is the maximum trade I've ever done. It was kinda "interesting". (My usual movements are in the 500-5000 range.)
@jennypenny - Several years ago (about a year or two before the financial crisis) my dad (close to traditional retirement ago) had all his stock (quite a bit) invested in his [local] bank. I strongly recommend he get out of it and into cash ... which he did. There was some grumbling as the stock price kept moving up for about a year after selling. After crashing quite low over the next couple of years, he was quite pleased though. But yes, giving advice is always tricky ... if it fails, it's your fault. If it works, they're geniuses for acting on your advice. No way around that one :)
Posted 1 year ago # -
Yeah, I bought him the Harry Browne book, but I made 100% sure that he owned the decision. The reason I executed is basically an old-person computer thing.
The PP is holding up... so far. But we all know past performance doesn't guarantee future returns. My worries are that I'm jumping on the bandwagon, so to speak. It seems to me that gold, bonds, and stocks have been more correlated recently than I'd like. On any given day, gold and bonds seem to do the same thing and stocks seem to do the opposite. Also, gold and bonds seem overbought to me. So short term, I worry that gold and bonds will go down, stocks will rise, but not enough to carry the portfolio. That's short-term though. Since I've bought into the long-term philosophy, short-term market timing seems like a gamble.
My other worry is that a lot of PP enthusiasts actually have trouble articulating why it works. Non-correlated assets do not equal growth. My personal understanding is that all assets, on average, will grow by inflation or more. On top of that, you have the rebalancing bonus. But what if the rebalancing bonus goes away? I think performance might suck.
401k question: My dad actually had 100% in a 401k. His 401k has a decent stable-value fund (actually paying a couple percent as of now), and a low-cost Total Market Fund. Everything else was kinda crap. So he rolled half over into an IRA. This has risk (in California) because the funds are not (may not be) as well protected from liability. That's why we tried to keep as much as possible in the 401k.
So the 401k has 25% total market, 25% stable value, and the IRA has 25% gold (split between IAU, GLD, and GTU) and 25% TLT. Maybe in the future, we'll replace the TLT with directly-held treasuries. Does that make it hard to value/rebalance? Any downsides? Strict PP probably would frown on the stable value fund for cash, but it's OK for now -- maybe he'll re-evaluate later.
Edit: I hope I there's not some special way to trade large sums that I screwed up. I mean, the trades were large to me, but compared to the really big fish playing in the market, it's nothing. I think there's enough liquidity in the funds that it shouldn't really matter.
The gyroscopicinvesting forum has quite a bit of discussion about crappy 401ks. They call it "making 401k lemonade" or something like that.
Posted 1 year ago # -
> "From 1905 to 1942 US market returns were zero."
>
> Is this with reference to price appreciation without factoring
> in dividends?With no comment, I checked this against Shiller's data: with dividend return included, the real inflation adjusted return over the above period was around 4% annually. Past return does not guarantee future etc. but the longest flat total return period has been less than 20 years (around 1970s).
Posted 1 year ago # -
What's on everyone's shopping list?
I recently posted an article on my site regarding my interest in AFL, INTC, T, VOD and PEP.
AFL and INTC both seem pretty compelling buys right now. I'm going to receive a commission check tomorrow and put $1400 or so into one position.
Anyone doing any shopping this week?
Posted 1 year ago # -
@DividendGuy
I'd like to add to my INTC and PEP positions as well, but don't have enough dry powder to make the Scottrade commission worth the while. I like to buy in lots >$1400 so that the $7 trade represents less than 50 basis points.Posted 1 year ago # -
@Maus
You're speaking my language my friend. >$1400 is right in my wheelhouse, and I try to keep transactions around $1500 when possible. I also use Scottrade.
I really like PEP and always consider it a buy under $64, but AFL seems like it's screaming at me right now. INTC also seems VERY favorable around $20.
Posted 1 year ago # -
It seems to me that gold, bonds, and stocks have been more correlated recently than I'd like. On any given day, gold and bonds seem to do the same thing and stocks seem to do the opposite.
This has been an above-average year for the PP. So I wouldn't be surprised to see a below-average year soon, a reversion to the mean.
My other worry is that a lot of PP enthusiasts actually have trouble articulating why it works.
I wouldn't worry about whether other people can articulate why it works, but just whether you're comfortable with your own understanding of why it works. I don't think very many people could explain why an airplane wing works, but that doesn't make flying any less safe.
Strict PP probably would frown on the stable value fund for cash, but it's OK for now
Yes, ideally cash should be 100% Treasuries. But a stable value fund is acceptable (as long as we don't have a national-scale bank run).
Posted 1 year ago # -
Most of my portfolio is in dividend stocks but I have a few trades in stocks that are in long-term uptrends. I accidentally sold CMG on the panic lows the other day @$299 only to see it climb to $310 the same day. I had been thinking about exiting this position so I put an order in over the weekend, but for some reason I thought I had canceled it before putting it in.
I could have sworn I never even completed the order because one thing I thought I had learned is never trade on a Monday (or Tuesday after a holiday weekend) morning. Also, never sell in a panic. @Jacob I'm surprised you put your stops in with your broker.
I chalk this up to not sticking to my plan (25% trailing stop on anything that is not a "core" holding). Chipotle had plenty of downside before I needed to worry about exiting.
I replaced this position with a new position in COP. This one I plan to hold for the dividends.
There is a short list of stocks I would consider buying if I wanted more exposure:
BDX
ADP
APD
MMMAll of these are Dividend Aristocrats," I believe. You can punch in those symbols on dividendinvestor.com and see how they are rated in terms of consecutive years dividends paid, yield, payout ratio, etc.
I have TEF. I might have to unload it as it is looking pretty negative. Although I bought it as a dividend/core holding, I am wondering if the dividend is covered. Why does the chart look so ugly?
I have some dry powder but I am thinking my equity exposure is already high enough. I'm looking at buying some foreign currencies and, when bonds pull back, adding to a laddered bond fund. It's "risk-off" right now so bonds yields are once again ridiculously low.
Posted 1 year ago # -
I am pretty boring when it comes to investing.
I use a mixture of ETFs and Index Funds in my TD Waterhouse account. Commission fees are $9.99 a trade for ETFs.
I have the following asset allocation in my portfolio:
Canadian Large Cap 10%
Major Canadian Bank 10%
Canadian REITS 10%
Canadian Short-Term Bonds 10%
Canadian Real Return Bonds 10%
US Junk Bonds 10%
International Developed Markets 10%
International ex-US Small Cap 5%
Emerging Markets 10%
US Large Cap 10%
US Small Cap 5%Due to the fact that I use an investment strategy called Value Averaging (http://en.wikipedia.org/wiki/Value_averaging), I keep cash as a separate component from my stock portfolio.
The basic premise of value averaging is to first plot a value path based on your expected savings rate, return rate, target portfolio value, and time period.
Once you plot the value path, you re-balance your portfolio against the value path by selling into cash or buying into the portfolio on set intervals -- I do my re-balancing on a quarterly basis.
For example, say you have plotted your value path like this for the next three years.
2011: $100
2012: $200
2013: $300If your stock portfolio were valued at $50 at the end of 2011, you would buy $50 into your portfolio.
If the following year your portfolio were valued at $250 at the end of 2012, you would sell $50 of your portfolio.
The value averaging strategy tends to result in a lower purchase cost than dollar cost averaging and works well in volatile markets. It keeps cash as an asset separate from the overall portfolio and forces you to buy low and sell high.
In addition, value averaging includes a selling strategy which a dollar cost averaging strategy does not.
I have been quite happy with this method so far. It's low stress, doesn't take a lot of time, and is easy to follow.
Posted 1 year ago # -
@pooablo That sounds pretty sound. How long have you been doing it and what has your experience been like?
Posted 1 year ago # -
I recently purchased 42 shares of AFL at $34.74 a share.
Posted 1 year ago # -
@Dragline -- The value path has worked pretty well for me. Unfortunately, I have only been really keeping track of the strategy since January 2010. I balance my portfolio at the end of January, April, July, and October.
Here is a brief summary of my actual portfolio value versus my target path (in brackets) over the past two years.
January 2010: 107,191 vs. (105,000); sold $2,000 into cash.
April 2010: 115,830 vs. (111,014); sold $4,000 into cash.
July 2010: 118,253 vs. (117,152); sold $1,000 into cash.
October 2010: 127,016 vs. (123,414); bought $4,000 into the port.
January 2011: 127,657 vs. (129,803); bought $2,000 into the port.
April 2011: 135,667 vs. (136,322); bought $1,000 into the port.
July 2011*: 120,890 vs. (129,500); bought $9,000 into the port.
October 2011: ?????? vs. (135,600); we'll see what happens!*I had to re-adjust my value path in July 2011 because I decided to sell a portion of my portfolio to invest in a limited partnership involved with a commercial property.
Overall, the strategy kept me disciplined in 2010 by forcing me to sell down in the April, July, and October 2010 bull run and to buy less in January 2011 and April 2011 which protected me against the drops in the market over the past few months! :)
With the drop in markets during July, the strategy forced me to buy more into the portfolio. I suspect that with the markets still down, I will need to buy more of my portfolio again at the end of October 2011.
However, July used up a big chunk of my cash so I may not be able to top up my portfolio in October to hit the $135,600. I am setting aside about $360 cash per bi-weekly paycheque and should have about $5,000 of cash for the next re-balancing period.
If that is not enough, I may tap into my $15K emergency cash fund to top up the amount to reach my target.
Normally when things get volatile I limit my "buy-in" to $7M so that I don't use up my cash too quickly! The $9M buy-in for July was an exception because I was re-adjusting my value path.
Sorry for the long post! I hope this gives you a better idea about the strategy.
Posted 1 year ago # -
@Maus
Interesting to hear your thoughts on lot size, something I've struggled with myself over the last few months since beginning my dividend stock portfolio. Early on, I bought in much larger lots (~$5k), but now I'm thinking I could have been more diversified had I bought in smaller lots and averaged down in a couple positions.Is there a particular formula you apply based on the commission you're paying?
Posted 1 year ago # -
...and then I'd close my NFLX short for a 33% gain, and stay long FXF (Swiss Franc).
Posted 1 year ago # -
I bought 100 shares of T last week. I think it was a good buy.
A month or so ago, I bought WEN, and it's only went down. Not sure how long it will take to get back to my original purchase price. I am a long term investor, so I am willing to hang on for a few years.
Posted 1 year ago # -
I long tome ago stopped investing in single stocks. Any negative quarterly report surprises can kill you with 30-40% one day pullbacks. And the best stock selection can go wrong when the timing isn't perfect and you started just at the beginning of a general market correction.
I invested in the last decade with great success in s simple strategy. It looks at he first moment conservative but it has a really great return booster which was successfull even in the decades bear markets: Invest 80% in long term bond ETFs when long term interest rates fall and change into short term bond ETFs when long term interest rates start longer term uptrends (other than bonds bond ETFs have very little transaction cost at online discount brokers). Invest 10% in SPDR S&P 500 ETF medium term in-the-money calls and hedge them by selling similar calls at the beginning of each market correction and bear market. The strategy uses the 15x leverage not to speculate but to reduce risk. Each $1000 call investment participates in 80% of the capital gain of $15,000 ETF share. The hedging protects the long investment against losses. In 2010 the sold calls compensated most of 4 SPY price corrections of 6,1%, 13,7%, 6,7% and 3,8%, in total 30,3%. You can learn the know-how of the strategy in a tutorial priced only $24. Visit the free website http://www.best-smart-investing.com
Posted 1 year ago # -
It seems the stock market is having another sale... I'm still new (read: groping in the dark) to investing but here is what I have on my watch list and I'm considering pulling the trigger on one or two of them:
VTI, NLY or SNH, ADBE
Anyone else considering these or similar?Posted 1 year ago # -
I think the stock market is in a vulnerable position. 10.5 on the DJ was violated, next resistance 9550.
I think cash is king right now, a good time to wait... I wanted to buy more gold at these levels, but I think even commodities will drift down.
Posted 1 year ago # -
another hypothetical trade: buy AAPL today before the iPhone 5 announcement. they're trading at *only* 15:1.
Posted 1 year ago # -
It certainly feels like there are more bearish clouds on the horizon. The question is: has the market priced them in? I think only partially.
Tomorrow I'm probably going to look to beta hedge part of my portfolio and hold onto the solid dividend standbys. Lowering emerging market exposure, too.
Posted 1 year ago # -
I recently sold my 64 shares of HGIC after the buyout offer from Nationwide. I sold all 64 for $58.73 a share, a tidy profit.
I then:
Purchased 25 shares of PM for $62.50 per share.
Purchased 20 shares of COP for $61.53 per share.
Purchased 32 shares of AFL for $33.85 per share.
This was not the end for me this month. I receive a large commission check tomorrow and will have around $3k to play with. I'm waiting for the next pullback.
Posted 1 year ago # -
Bought AGNC at 26.88.
Posted 1 year ago # -
Dividend growth stocks that bubbled to the top of my list this week: LMT, AHGP, COP, & GE.
These are noteworthy because they're at the upper end of the dividend growth and, apart from AHGP, usually not available at the current yields.
Posted 1 year ago # -
@George the original one
LMT is interesting. Any thoughts on it trading at 7.6x book value? It also has some unfunded pension issues. Great yield with the recent increase though, and I like defense stocks right now. They're all pretty beaten up. I'm currently not only looking at LMT in this sector but also RTN, HRS and GD.
I'm also looking at: T, MDT and PEP. I'm strongly considering purchasing a half lot of T and one defense stock this week. A reader of my blog has pointed me in the direction of HRS. Looks promising from a valuation standpoint, but I have to look a little further into their business.
Posted 1 year ago # -
Nibbled on some emerging markets (VWO) this week, initiating a position to fulfill my target 5% allocation. That fund was 30% off the high for the year when I bought at about $36. This feels a little uncomfortable since the dollar has been rallying, but the risk-on stuff are heavily oversold and will do the best in a rally.
I bought some Vanguard bond ETF's (BSV, BLV, BIV) because I know I need some exposure to complete my asset allocation. My timing was probably pretty poor as they lost some ground this week. But I look at those as hedges for my equity exposure anyways.
Sold ED to book a 8% gain (incl. reinvested div's) and replaced it with a smaller position in VPU to get some broader diversification in utilities.
Trying to be at least somewhat of a contrarian...
Posted 1 year ago #
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