If you look at almost any chart -- you'll see why I went with WFC over BAC... The 10 year is one of the worst charts out there = With BAC's share price DOWN 61% while WFC is UP 73% over that same 10 year period.


Those numbers are HUGE by WIDE... and can make one hell of a difference in your investment portfolio.

Totally agree with you Greg. And if I were broadening my portfolio and looking to add another bank stock - I would look at WFC.

That why I mentioned this is a short term stock for me. Like 2 months pending FEDs findings with BACs books. Its only 620 shares worth. Not 15000.

I mean, Im not lookin for much. Just 20% lol.

I've personally dealt with both banks many times throughout my real estate career. B of A's name is mud in the business. Agents don't want to accept offers from buyer's that are obtaining mortgages from them. They tend to close way late. On the short sale side of the equation (debt forgiveness), they are a bit weak in my opinion. They just don't fight very hard.

Wells Fargo isn't perfect on the lending side but I've had more good experiences than bad. I've also dealt with them on short sales and they have required cash contributions to short sale, even in hardship situations.

I do bank with Wells and have for 15 years. I've always been happy with them and many times I'm greeted with a smile and hello when I walk in the door.

Sounds like a company that meets the conditions Greg has laid out.

Speaking of BoA...

http://blogs.wsj.com/moneybeat/2014/...ica-citigroup/

Very good insightful info Todd!


I've always said that investing is made easy - if you just look around at what you do every day.... and who you deal with on a regular basis. Gasoline - cars - banks - stores. Do you like the way they do business? Do you like the feel of the store and the merchandise? Are they busy? Do you feel good about doing business with them. Nothing too rocket science about that... because chances are if you do -- others feel the same way. Then you dig a little deeper and see how their stock stacks up to the competition...

Just waiting for a CNBC report on --- "you need way more than a million dollars to retire on".... will be interesting to see what they say.


I have been saying this for a long time... A guy can only make 5% or so on a million bucks -- that's 50 grand a year GROSS.... you will be paying taxes on that gross! 50 grand a year -- is now NET 40 grand or less depending on where you live. Add some Social Security -- and factor in INFLATION.... Retirement isn't going to be the golden years. You're going to need a RISING income -- and capital growth... in order to live for an additional 20 plus years after retirement.


I know this info sucks - but facts sometimes suck.

Quick question. On a Roth IRA account, are all gains tax free(growth and dividends)? I believe it would be hard to get to a million$ in a roth IRA given annual contribution limits, unless you made some lucky picks.

FIRST ---- YES all growth and dividends are completely TAX FREE... at withdrawal. ROTH IRA was the greatest gift from the tax man - EVER.


Second - Yes you're correct. Unless you began contributing the maximum to a ROTH IRA in your teens or early 20's. But this is just ONE AVENUE for retirement planning. ROTH contributions are AFTER TAX = which is why they come out tax free... You can still participate in a PRE TAX retirement account to it's maximum as well... And there's nothing saying you can't also invest outside the ROTH and IRA/401K type accounts to reach your personal goals.

That's the whole thing that is wrong with "people" in general -- they get focused on only being able to save in one account or the other - to the exclusion of other proper investing. Too bad -- because it's THEIR future and it will suck if they don't put money away for when the gravy train stops.

Here's a point that was made on CNBC when discussing the current interest rate environment -- and how this affects retired people and retirement plans.


With low interest rates -- the returns on capital have been pretty terrible... as the safer investments that used to be good for retirement accounts are paying crap rates of 2 and 3%... That's killing spending and income for a large segment of the population.

With HIGHER rates - comes better income... at the same risk level. What people have had to do is to raise their risk level to get the same income. This is why you can really only "expect" to get 4 or 5% because you have to trade off the income potential with the risk potential. This might seem easy to do but it's not. Once you have no more ability to generate income other than off your investments... you become a different investor. You do not want to lose capital! You don't have the ability to replace it if you do. That's why you take more risk when you're YOUNG... because you have many years to stage a comeback and you just might end up being a big winner if you've made good investments.

Personally I'm always hoping for raging inflation... I'd love to invest and make a 10% return in relative safety! That would double my income... WTF would be wrong with that?! But I'm not buying stuff where the inflation that comes with that, would hurt me. It kills everyone else - and especially those with businesses to run and overhead and rents etc.

WE WILL SEE RISING RATES... period - end of story. They're not going lower from here. What will kill EVERYONE is if they rise too quickly. If they just inch up and hold steady and then inch up a little more -- that's good because it means business is good - and people have time to adjust to the costs etc. So it's the RATE AT WHICH THEY RISE is what's important. That's what the FED is trying to control right now. We'll see if they can contain it.

This is pretty cool stuff! It doesn't make the shares worth more.... but if you go back to the days of Dell and Microsoft and Intel et al --- the splits were what made people really rich. They'd split and double and split and double. Not saying that is going to happen here... because the company is already "fairly" valued. But it's still kool for you NEWBS to watch and see what happens -- and if you own it - you're going to have 7 times as many shares! Then - if the shares just go up 50 cents -- that's really $3.50 and that's what you want to see.

This stock is already "volatile" -- in that it moves 5 or 6 or 7 dollars now... but let's see if you get a $5 move --- and it's multiplied by 7!! EEEEEEHHHHHAAAAA









Apple, Inc to split stock 7-1 after Friday June 6 market close

So if I understand this correctly - If I owned 1 share of Apple at $100 after the split I would then own 7 shares @ $14.29?

Meaning if said share value changes by $1 then I'll be making/losing $7 vs the $1 I would've made/lost if the split didn't happen?

CORRECT.


You'll get 7 shares for every one you owned --- but of course, you'd also divide the current price by 7

On MONDAY they'll begin to trade at the new split adjusted price.


Will be interesting to see if people BUY because it's now "affordable" -- or if the current holders SELL because now they have 7 times as many shares.

We need more buyers than sellers... it's just real simple that way. :>)

Guy at work claims he owns Apple stock. He was all on the fence about what to do with the stock - this morning its a little late. Might as well hold it now.

I know a lot of people who want to buy it just because of the name. Those who know nothing about trading. That may be enough to increase the value of the stock in and of itself.

Lettuce hope there are more buyers than sellers.

Aapl is a long stock. He shouldn't panic, $1000 dollars worth is still a $1000 worth of shares. He just has more to play with.

I've discussed here many times - that this is NOT a stock pickers thread... but that we have to use stocks to discuss all the things that you should be paying attention to in order to either invest (buy) or to know when to sell... or when to take a profit (taking some off the top when you have a nice gain).. or perhaps when it might be prudent to "average down".


I've often stated that paying attention to FUNDAMENTAL changes to the businesses you're invested in is probably the single most important "metric" to good investing. These fundamental changes can be good - or they can be bad.

It would take three pages to describe "fundamental"... so let's just make it real easy and say that it's anything that's big and basic that you would ASSume would be important longer term.


So this morning - let's use McDonalds (MCD). I just read that SALES have slipped again. Down 1%... and that the CEO has once again stated they have some "challenges".

I sold out of my MCD position well over a year ago based on my personal feelings -- and I did that because I felt (gut hunch) that peoples eating habits are changing. There seems to be a movement for healthier eating habits - and I'd include myself as being one of those folks that pays more attention to how they're eating. I eat WAY less hamburgers and milkshakes than I used to (I'm still short and fat - but WTF - I feel good about myself! LOL). I also felt the stores quality was slipping. Cold food - dirty tables and floors - and just generally a slip in way I personally viewed MCD retail outlets. That, to me, is FUNDAMENTAL. And I've said that investing is simple if we just look around and react to what we see/feel.

Fundamentally - when you have SLIPPING SALES... i.e., sales going DOWN - that doesn't bode well for an investment. So if you compare this to another company in the same space - let's say Chipotle Mexican Grill (CMG) and their sales are UP 10% (just making this up)... then maybe there's something you should be thinking about. Don't just let things like this slip by you - open your mind to INVESTING - and ask yourself if there's a better place for your money... whatever that is.... Just don't pass off fundamental changes, shrug your shoulders, and bury your head in the sand because you actually have to THINK about your investments.

Look at the 10 year chart of Wells Fargo Bank (WFC) versus Bank of America (BAC)... the difference is staggering! And one made your portfolio pretty snappy and one sunk you like a boat anchor... (I own WFC)

If Apple computers (AAPL) stores were absolutely swamped with customers last Xmas - and this year you walk by and there's nobody in them - That is a fundamental change you should pay attention to! (I own this name)

One of the reasons I advocate for owing fewer names (but no more than 5% in any investment -- is so that you can scan the news quickly for information on your investments. If you own 50 names - you won't even be able to remember what they are! If you own 10 or 20 -- you can stay on top of 'em.

Not to change the subject y'all have going....but I actually am looking at investing.

This morning I was driving to work and it just hit me: I need to start doing something for retirement. There's a lot of reasons for this thinking, but those aren't important.

When I was younger, I had a Roth IRA with ING Direct. During college I cashed it out in order to live and keep my debt to a minimum. It was only about 5-6K or so, not 50-60K.

I see that ING Direct is now owned by Capital One 360. Should I start another Roth IRA with them? I do love how you guys buy and sell stocks...and I want to get up to that level, but right now time isn't affording me that luxury, nor do I have the skill/knowledge to do that.

So here's my question: What company should I start a Roth IRA with?

Thanks for the help guys!

Welcome to the group!

As far as where to open the account, I would suggest somewhere you're comfortable with (ie. do you need a local branch or no? personally, Having a branch local does nothing for me). And the costs.

I opened mine through Sharebuilder, via Costco. If your a Costco member to to their Services page and check out the link through to Sharebuilder. They usually give you a credit for opening an account. On top of that, their market trades are $6.95. Which is on the cheaper side of the industry if i recall. Their "Auto investment" trades (happens on Tuesdays) are only $2.

By the way, they're also owned by Capital 1 now. I've been using them for several years and havent had any issues.

This has been covered here many times --- and there's really no right answer except to use a "discount broker". Brokerage fees can, and do, affect your returns... so you want to keep those costs low.

Personally I use several - but for different reasons. Some investments I need help with - some I don't. For me personally - I don't want to have too much at any one company - so I spread it around to reduce risk.

But the point is - if you're comfortable with the website - and or just like a particular company - then go with that one. Investing is more about putting money away - INVESTING (not gambling) and reaping the rewards over time.

When you feel you have some time -- go to page one and start reading... it will help you overall and that's what this thread has tried to be about. Not WHAT to do but WHAT TO THINK ABOUT AND WHY....

Soooo where is that thread then?

:G-Dub:

Think about it this way.... Catch a man a fish - or teach him how to fish...

was he asking what stream you like or what fish taste the best?

That's a fine way to put it!

What about the guys that day trade for fun? I mean there is The Street, Motley Fool, ect........but it would be cool to hear some thoughts or get speculation from car guys, not from stiffs in suits.

I don't know - prolly :wrongforum:

I do realize that my question was kind of like "What's the best shade of blue?" haha.

That is really smart though, putting your money across multiple channels. For me personally, I have a house and its currently being rented out. For the last two years, that has been my "retirement" fund. I'd actually like to get more houses and rent them out, as I like tangible assets.

On top of that, I've been focusing on becoming debt free. I'm getting close to that(minus the mortgage payments). Now that I have some extra money available, I'd like to start investing some of that into some sort of Roth IRA.

I'll have to start reading all these pages and teaching myself.

See -- the thread title is INVESTING 102.... if you go back and read from the beginning you'd see why it's called that... and not GAMBLING 101


Jokers and fools day trade... rich guys get rich because they INVEST.... there is a magnitude of order of difference. If you want to - you can start a Day Trading thread and I'm sure you'd get some followers and plenty of discussion on that topic.

What Greg is trying to say is you have to understand the tools you are using to get the results that you want.

I don't know anyone that trades for fun. It's about investing and collecting a pay check when you are retired.

Read the thread and you'll soon get the point around page 275.

The tools and advice are there you just have to use them to make the choice of what suites your needs.

Welcome to the club. Good luck to you too. I have Vanguard for my Roth and Fidelity for company match 401k. I prefer the way Fidelity has their website laid out. I know Greg has said he likes his Schwab account and the tools available to him on the website. So you might want to check out the different company's websites and see which one you like best. The various discount brokerage houses are or should offer Roth IRA accounts with low costs. You can choose your own stocks like I have done or put it into a targeted retirement account which will adjust the risk level through the years as you near retirement age. There's a lot out there so be sure to read and ask questions. You'll quickly learn what you're interested in and what your risk level is going forward. This will help you concentrate on what matters and help keep you from being overwhelmed as the options.

MMmkay then............I guess back to Investing 102

Question about diversity (just searched and found that Greg likes to be as diverse as possible and like 8 segments). Im in 5 different segements - is that enough? Its the bulk of the paltry $100k I have put away since starting work 10 years ago.

Banking
Energy (solar)
Tech
Industrial (Aerospace Mfg)
Shipping (Rail - not sure if this the right category though)

Looks good? Thoughts on those sectors?

There is no way to always follow every "rule" -- which really should be thought of as "guide lines" rather than rules...

Owning 5 different sectors is excellent overall.

But what's really important -- is which names you own in each sector.... Do they pay you to own them (do they pay a dividend)?.... and what's the name you own TOTAL RETURN over a longer period of time (5 and 10 years) as compared to the other companies in that sector (in other words - their competitors).

Doing this research yourself -- gets you involved in understanding the possibilities and can affirm (or not - LOL) why you are invested in them.

Investing is about MAKING MONEY.... and MAKING MONEY LONG TERM. So take a look at every name you're invested in - and look at PERCENTAGES more than dollar amounts -- because you can directly compare percentages. Obviously 10% is better than 2% -- but you might have a gain of $10,000 on the 2% earner.... and only a gain of $1,000 in the 10% earner. Obviously you'd be way farther ahead having that reversed!

But what you're really looking for is the TOTAL RETURN on your investments. That's the ultimate metric. That's a combination of the dividend (if any) and the growth of capital. It doesn't make any difference where that total return comes from - as long as it compares favorably to what else you could have invested in.


Just looking at Bank of America (BAC) vs Wells Fargo Bank (WFC) over the last 5 years ---


Total return for BAC -- 33.7%


Total return for WFC -- 131.7%


So both are "Financials" --- one more than doubled your money in 5 years -- one only added a 1/3rd


There is no better comparison than TOTAL RETURN on your investment IMHO. You need to look at everything you own and make these kinds of comparisons and see how your's stack up. Sometimes it's a real eye opener.

Greg, thanks for all of your input over the last few years here.

How did you get so knowledgeable? Just years of experience and paying attention and learning what the numbers mean?

I have been managing large sums of money for 30 years... and yes... experience is sometimes the best teacher. And yes -- I once day traded for a number of years. That experience will only teach you how to pay the maximum income tax... and how NOT to become wealthy.

I currently have a "loss" but my portfolio is worth more than what I started with. I love dividends!

Just had an interesting email show up in my inbox, I bet several of you did as well. It is in regards to a company going public and the email is an invite to participate in the IPO. It is kind of a "friends and family" deal but the company is including their customers on the friends and family list.

I'm torn, and this is probably more of a "gamble" type investment than an "investing 101" type investment...but I like the company and I like their products which are hugely successful. One just doesn't know if the success will continue and show itself in the growth of the share price.

There are limitations that are included with the email about how to share it so I won't share it here, but I'm curious if anyone else got it and what do you think about it?

I haven't received anything like that, Lance. I'd approach it as a gamble possibly since I'm not sure what company you're talking about. If they make a good product that is popular, I think I would seriously consider taking the gamble if I had some money to play with.

Of course, I'm assuming this isn't some sort of scam, right? I watched Wolf of Wall Street couple weekends ago so yeah...

Well, a quick google search shows it's not totally secret...

http://www.reuters.com/article/2014/...0EM0Y620140611

I think you have to have a link from the email to get into the friends and family deal though...

I don't see that as a long term money maker. Might pop and catch a wave up but it could flop just as quick.

I'd be all over it. But keep it real. Only money you can truly afford to play with.


In 2004 I invested in a start up. That $385,000 returned $20M in 2010. So it's okay to take on risk if the rest of your life is good to go.

I would too now that I see who it is for. I think it might turn out good. GoPro has really done a lot with their cameras.

While not a Roth IRA, one way to buy stock over time is through direct investment plans, Computershare has many of the blue chip dividend type stocks with reinvestment plans...https://www-us.computershare.com/Inv...&cc=us&lang=en or Sharebuilder is another good resource that has Roth IRA's, part of the Capital One group.https://www.sharebuilder.com/sharebu...p/default.aspx

I have participated in a number of Computershare stock purchase programs, you can contribute as little as $50 month and over time with dividend reinvestments, adds up...

Awesome, Thanks for the tips on both of those. Haven't heard of the Computershare before.

What do you guys think of investing in one of the companies pushing forth development of the new protocol IoT (Internet of Things).

Like Cisco? Or?

It looks like a solid 7-10year investment.