Nope........too busy watching the rise of CPST :rofl:

when that thing hits 1.25 im gonna buy the house next to you and turn it into a air-B&B :rofl:

Gentlemen,

I'd like to start by thanking everyone who's contributed to this thread. I found a link to it on another forum a while back, and it's been a great resource, and motivator for me. I appreciate even the people who seem very knowledgeable keeping it at the beginners level for those of us that aren't. I'm also very surprised at how open people have been using themselves as examples for the rest of us. Again, thank you.

My father made great efforts to get me to invest, and I did open an IRA when I was 20, but I never really understood much about it. He always spoke at levels far beyond my comprehension and lost me.

I'm currently 41 and retired from the Army. I'm already realizing some mistakes I've made (besides not investing), but my one saving grace is that I live below my means. For years I comforted myself that I was saving for a house and didn't want the money tied up. I bought a house about 1 1/2 years ago and kept saving in a bank account making a whopping .5% or so.

Since reading this thread I've picked up:

Altria Group (MO)
ATT (T)
Southern Company (SO)
and Royal Dutch Shell (RDS.B)

I plan to try and add a bit more diversity in my next purchases, but I overshot on the first few, so I won't be at 5% in each for a while.

I'm on several car forums, but I never thought I'd join one due to an investing thread. I've made it through about 200 pages here so far.

Thanks again to everyone and I look forward to continued learning!

WELCOME!!! You'll find a bunch of the info repeated --- but just keep hacking away at it -- because sometimes repetition finally makes some sense after reading "other" stuff -- and then all of a sudden it's a BINGO!

That .5 interest rate is why this thread has been helpful to many -- if for no other reason than to help them make some kind of return in this crazy world.

CPST was up 12% yesterday. A few more days like that and I will be out of the hole.:G-Dub:

:D I'm watching it!

Shortly after his comment (jinx) it opens up +5% and slides to -2.5%. :bitchslap:

:D

cuz I bought a 1000 shares based on Charlies advice.

You can all go broke with me...

you guys can put up tents in his yard, plenty of room right? :peepwall:

You do know that "pump and dump" is illegal right?? LOL

I've reminded on many occasions for you all to "remember" when the market went up daily... and making gains was easy and fun. You want to remember those periods - when we're in a stinky market like we are right now. These stinky periods are when I LOVE the dividend. Those checks are a great antiseptic to the pain of the losses of those easy gains. For those of you that are in dividend reinvesting - they're also buying shares at lower prices automatically... bringing down your average cost - and building dividend payouts in the future.

Funny how the psyche works -- if I put a '69 Camaro up for sale - and I cut the price from 100,000 to 65,000 you'd be happy! And you'd be unhappy if I raised the price from 100 to 110,000! But not if we're talking about stocks. LOL

It's summer - stocks always suck in the summer. Add to this the possible slowing growth of China -- and a possible FED interest rate hike - and this is the kind of market you get.

I'm a buyer in these kind of markets - but I ALWAYS have plenty of cash kept on the sidelines because it can always get worse! It will help your thinking - if you tip toe in rather than dive in and then watch the shares you just bought go lower.... Keep some buying power "dry". You'll feel better about it.

I'm going to spend a week rafting the middle fork of the Salmon river.... and I won't care one bit about what the stock market is doing.... thanks to the dividends.

CPST chart over the last 15 years. Looks like they have been struggling for a long time. Greg, this doesn't look like the kind of chart you have recommended. ha ha

The key for me personally is to not be greedy or get too 'attached' to my stocks and 'make hay when the sun is shining bright' by selling some of my less desirable 'gainers' near the top of the hill thus creating a cash reserve that allows me to capitalize on the pending market downturn.

:sieg:

Todd --- You're a good student. Drive downtown - put 100 grand on Black or Red - your choice.... and you'd stand just as good of a chance.

Everyone has their own special reasons for buying this or that. What I've tried to "preach" on here is that there are fundamentally great companies to buy - that are making money hand over fist - and are willing to share those profits with their shareholders (the owners of the company)... why not own companies like that FIRST - and then - if you're a gazillionaire and can afford to gamble (and lose)... go for it.


Years ago when I was day trading with a 3 million dollar account (separate money I could afford to lose).... I bought 10,000 shares of a company - they went down - I bought 10,000 more - they went down and I bought 20,000 more..... Each time I was reducing my cost basis... in the theory of -- Get the current cost basis closer to where the shares are trading - that way they have to come back "less" to make me whole. I eventually sold the 90,000 shares I held at a $1.00 per share (each) loss. The trade thus costing my 90 grand. But I'd only lost a dollar per share. LOL

Funny right? My original purchase - had I just sold it all at a loss would have cost me about 5 grand.

Back then - I was making 10 or 20 grand per day, day trading that 3 million so I really could have cared less (pre-1999!) - But I've never forgotten the lesson.

I looked at a bunch of the stocks in my portfolio that are strong brands over the last 15-20 years. I have to admit that it's a bit alarming to see a majority of the stocks I researched gain 2, 3, 5 times their value in the last 2-4 years. A majority plodded along a majority of the time the last 20 years until around 2008. I'm really in this for the long haul but it sure looks like a major adjustment must be coming?

For example, look at Altria. If I wasn't in this for the next 30 years, I'd have to be seriously considering pulling the plug on some gains. Am I way off track here? Especially if dividends aren't fueling enough of your income.

Nobody ever went broke taking a profit....


But it depends on your goals and timeframe. If you're (anyone) is still needing to diversify - then trimming some gain - to re-invest in something else, is a nice way to get there.

Here's the dilemma. If the shares drop (which means the MARKET drops) your dividends will buy new shares at the lower prices. Over time - that's a good thing as it's on autopilot. PEOPLE are reluctant to buy shares on sale... and tend to miss the better prices because they're waiting for them to go lower....

You also want to re-invest the "gains" in something... and IF and WHEN the market falls - it takes everything with it. Ditto with gains - a rising market tends to take most everything up.

The problem with any of this is "trying to time the market". It never works. You won't find Warren Buffett doing it that way. That may be why his Coke (KO) dividend pays him annually what his original investment was...

So --- I would only trim SOME of the gain -- if you need/feel you need to diversify. Keeping in mind you're creating a taxable event - be aware of he length of time of the holding - whether or not it's in a taxable account or tax deferred account etc.

It's definitely not an easy decision to make. I'm in the same boat with Under Armour (UA), earned 52.5% in less than a year and it's in a tax deferred account, but it's at a 90 P/E now!! I've made the mistake of not paying the tax on a huge real estate gain (even though I was pretty sure things had peaked, and they had) and re-investing the proceeds in another property, which ultimately tanked. Problem is where else would I have put it, in the stock market? And, that was in 2006, and look what happened 2 years later!!

Greg, I really wish you would just stop eff'n with all of us and just tell us what companies are going to earn 30-50% a year over the next 20!

That's always the issue when you sell a gainer... now what do you do with it. Obviously - we want to buy another name that gains. But that's my caveat... because in a down market - most things go down not up. So all you traded was a tax bill...

Those that sold in 2007 / 08 / 09 -- took losses.... probably were scared out of the market - therefore didn't trust getting back in until most of the turn upwards was "done"... HAD THEY JUST STAYED IN -- they would never have suffered the losses -- and would be 200 and 300% ahead now. That's why people advise NOT trying to "time" the market. You'll be out at all the right times - and in all of the wrong times... This is why I say - collect the dividend - let it buy discounted shares - building more dividends going forward - and you'll still be in great stuff when the market rebounds. When these occur and how long they last is anyones guess - and you'll never get it right.

I only wish I could predict a 10% gainer! Let alone 30%!

If I was that smart - I'd have bought 100% of the apartment building that just returned a 300% gain instead of only a little slice. Hind sight... it's a beautiful but useless trait. LOL

The huge stock gains in the last 3-4 years reminds me of the housing market 10 years ago. A huge upswing in a short period that resulted in a big mess. What fundamentals do you guys see in the stock market that dictate these huge gains being anywhere near sustainable? Serious question as I have not a clue. I know interest rates and a stronger economy have freed up discretionary income but to the tune of a 200% rise in stock price? Are we experiencing some new circumstances in the stock market that go against the historical grain?

Greg, I say that all the time, there is never anything wrong with taking a profit. I can say with absolute certainty that there have been times in the last 15 years where I would go back and park money in a safe place after taking a profit.

I'd like to hear some other perspectives on the market.

If you click a chart of the SPY --- 10 years out.... this is a ETF that is the S&P 500 stocks.

What you'll see is a peak in '07 and a price of about $149 a share.... then a big decline... then the rise to current value. Current value is $212. That's a 56% rise ==== not 200%

You can't use the bottom to calc a gain like this - because you first need to get back to it's old high.


The market is "high" because there's little opportunity elsewhere to put money. But I don't see any bubble - except in certain stocks. Go back to the P/E of your stocks and see where they are individually. That's a price to earnings multiple. I would call the market "normal" if the average P/E was about 17 ish. The current P/E is at 20 so slightly high. But you have to look at this as a WORLD market.... and money flows to safety and return. Right now - the USA looks pretty damn good compared to the rest of the world.

Here's an interesting look at P/E's -- Shiller P/E -- historical S&P price - etc.


Click across the top of this page to see various charts for their historical relevance.

You'll see the big blowoff top of 1999 -- the P/E was 44 !! That was the heyday of IPO mania and instant millionaire and back to the bread line... LOL The equivalent of the housing flipping market. Where EVERYONE you know was talking about buying houses -- back then -- the grocery store clerk told you about their day trading account...



http://www.multpl.com

So I'm just a 39 Year old guy trying to set up his retirement. I don't have much in the pot, yet. But at what point might some one realize they are throwing good money after bad?

Example. I bought into BPT early last year. At like 85 bucks. Today its at 48. I bought a bunch more at like 59. I have had a nice dividend improvement. So when oil comes back it seems I will have more shares. I'm getting ready to buy some more shares this month with me monthly payroll contribution. And I wonder should I buy more shares or is there a point you hold out for what you have.

I live in oil country and it sucks here currently. So its not just BPT that is struggling. My KMI and NBR is struggling. They have not recovered and continue to drop.

Can you give us some more lessons on the different evaluation numbers you talk about? Where exactly to find them.

I know oil will come back, it has to. But is there a point of just waiting it out more even though you can't time the market. I know the previous high was alot higher then 85 I can get my money back and more some day maybe in a long long time. Which is the plan anyway. Right?

The richest people BUY MORE in bear markets than they do in BULL markets...


They're smart enough to understand the theory of buying low and selling high... and generally have been around long enough to have lived thru the PAIN of down markets... and the thrill of then seeing what they bought gain (the opposite of pain) in bull markets.


To categorically state "oil will come back - it has to".... is wishful thinking. We just don't know that. We'd LIKE that to be the case - but we can't make a statement like that. There are too many variables -- mostly boiling down to SUPPLY and DEMAND. The supply has increased - and currently - the demand is down. When that corrects is anyone's guess.

That <above> is why people are urged to DIVERSIFY.... lest their big "bet" doesn't materialize.

I currently have about 2.4 million invested in "oil" - pipes - gas.... APU - BPT - COP - KMI - ETP.... combined the dividend stream annually is $185,000 from those... and like most everyone - I'm underwater on a few (I've held most things far longer than many on here). I just bought MORE COP.... and last month bought more APU... but I also own LOTS more stocks outside the oil patch - as well as commercial real estate. My point?? I have to believe that I'm getting a decent return on my investment while being patient and "hoping" they stop falling at some point - and turn around.... but it's the $185,000 annual dividend income from them that helps to bolster my psyche in the meantime.

The Schiller PE is 26.5 It's only been that high 3 other times in history. :bur2:



I should say that I'm still fully invested; but would feel leery about picking up any stocks with high PE multiples in a high PE market.

The SPY is for the S&P 500, not the DOW, just to clarify. Not poking at you Greg, I know you know and just flubbed one, I'm just mentioning it for the newbs. I always look at charts of companies or funds against that because if they haven't beaten it then why be in them really.

Oil is a tough one and like anything else we're just predicting the future. I think use is going to go down, the CAFE standard for 2025 is 54.5 MPG, double what it was in 2011. The oil companies are huge, and generally smart, and will figure it out. I can't help but wonder if they'll have to figure out batteries here pretty soon though. I sure am tempted to buy some CVX (where I but gas regularly) at a 5% dividend, I just personally don't think the stock price is going anywhere for a while and there is some risk that dividend will get cut.

It hasn't gotten any easier with all the ETF's and indexes either. They are where the majority of the money is I believe and often the best of breed stocks will go down in step with the worst of breed because of them.

I still think the best theory is buy what you know. If I would have done that a long time ago with Costco, Southwest Airlines, Snap On, Kroger, Under Armour (among others) I would have done pretty well and I would have felt reasonably safe because I would have picked up on a slide in products or services pretty quickly. I would love to buy some biotech as I think it's pretty exciting what they're doing with immunotherapy these days but I know nothing about it and would have no real idea why something went down all of a sudden (or up).

To me everything seems more on the expensive end than the cheap end but if earnings continue to steadily rise we might have a ways to go. I think when the Fed raises interest rates it will be a boost too, after an initial shock down, because it will instill a bit of confidence that things are finally on a steady uptrend. Ok, I'm done predicting the future :BlahBlah:

I'm curious, how many of you listen to the conference calls and read quarterly earnings reports of the companies you own stock in?

Trying to help answer your question about adding more BPT shares. You don't say what percentage of holdings you have in BPT, but one guideline is to not have more than 5% of your portfolio in one name. It sounds like you have other holdings in the energy sector too, so you might want to look at how much of your total portfolio is in energy. To decrease the riskiness of your portfolio, it is important to be diversified, so one holding does not have a big impact should something go wrong. That also applies to being too heavily invested in one sector.

I don't know much about BPT but I just took a quick look at it and one thing that stands out to me is the current dividend yield is 15.16% according to Google. That alerts me to this being very high risk and if it was me I would not have anywhere near 5% of my portfolio in something like BPT. But I may be more risk averse than you.

Thanks for the catch Erik!


Oils problem is a positive for a lot of stocks! Think how much savings WalMart must be enjoying - or the airlines - or UPS and FedEx.... The problem with that is you have to be able to see a problem and then figure who will benefit. I'm too busy enjoying other parts of life to be that nimble and you must be early to trade like that.

Whats funny (and sad) is i'm a stockholder in CVX and while it adjusts (declines), I'm paying almost the highest i've ever paid for gas (and yes, i buy it at Chevron, i'm paying myself a little by doing that).

I'm not sure, but in the gas companies play, the taxes here in Kilifornia are a great contributor to the higher per gallon prices, and theres lines at the pumps in my region....weird.

Is it suprise and "duh-mend"? or supply and demand? cant remember...




"It's time in the market, not timing the market".....

Looking at this from a consumer perspective, I find that Chevron is usually significantly more expensive than conpetitors with no perceived (by me) difference in quality. This is the problem with choosing a company that deals in a commoditized product. When I look at CVX, I'm not inclined to think they have a competitive advantage.

Thanks for the info. A majority of the stocks in my portfolio are well above the 17.

I have nothing to add, but I would like to say thank you for this thread and those who continue to contribute to it. For the first time in my 33 years I am looking to learn more about investing so I can get started. I guess I am a late bloomer, very late....

It got quiet in here.

I'm hoping this is a buying opportunity as I'm utilizing money I don't intend to need in the near future.

Since my last post I've added Coke (KO) and Kimber Morgan (KMI) bringing me to a total of six positions. I previously had:

Altria Group (MO)
ATT (T)
Southern Company (SO)
Royal Dutch Shell (RDS.B)

Here is my question for you more knowledgeable and experienced investors. I'm coming to the end of my available funds. RDS has dropped significantly since I invested. Would I be better off creating another position in a different sector, or buying down my price per share of RDS?

I appreciate any insight you gentlemen can provide, but please provide the reason you would do one or the other with your answer.

Things are too scary for me I'm selling everything tomorrow!!
Using the money to build my underground bunker.

Not an easy one to answer, especially not knowing how much of each position is in your potfolio and if these are your only holdings. I am by no means an expert but here is how i look at it.

I am going to assume the six stocks comprise your total exposure to the stock market and you are fairly evenly weighted in each position? If that is the case, The conservative approach would be to open a new position in a sector that you do not have a position in. The reason is it will make your portfolio more diversified which will lower the liklihood of one position having a big negative impact on the portfolio and lower the overall risk of your portfolio. You also said that you have a position in KMI which is in the energy sector as well. Buying more RDS would really put you heavily weigted in energy.

You mentioned that you are at the end of your available funds. The only way I would consider buying more RDS was if I knew I had more funds to continue adding to the portfolio with which i could diversify with when the next buying opportunity arrives. I Think it is difficult to remain equally weighted at all times and there will be times when you are overweighted in one position, especially when you are starting out. The important thing to keep in mind is to not get too heavily weighted in one position or one sector.

Sorry for the delayed responses. I was on a rafting and kayaking trip down the Middle fork of the Salmon river for the last 6 days....


So to me, this is a "guts" question. It's always hardest to "invest" in areas that are getting their asses handed to them. It's even harder to put fresh money to work when you're seeing a sea of red in your holdings. "Averaging down" is a very worthwhile "technique" if you're investing in GOOD/GREAT companies. It does NOT work if you're just chasing a stock that's falling for the simple reason that you "think" (HOPE) will turn around and save your butt.

The ONLY way this works is if you have the guts to hold LONG ENOUGH for the strategy to play out. You can put yourself in a position of adding new money and seeing that also turn red. We never know what the bottom is. We don't know when the MARKET will turn... this could be a number of years! Typical BEAR markets last 3+ years... that doesn't seem like a long time... until it's your money! LOL

Personally --- I WILL continue to buy more oil and oil related investments. I'm not going to put money to work that I need - and I won't just blindly pound money in, in the hopes that it will turn around one day. Oil could be down for a number of years until the worlds economy turns more robust and the demand rebounds to equal the supply. In the meantime - the dividends are good (for now). That's the key! At some point the dividends might be cut -- so this is when you need to pay strict attention to cash burn rates - profits - future statements about operations going forward etc. In other words - if you're investing in a troubled segment - then your ears need to perk up!

In this market ----- I'd be patient ---- and since you're young (guessing) --- and trying to diversify and grow your money.... I'd try to pick up ONE growth stock "on sale". A Facebook - or a NetFlix - or Apple - something along those lines. The "high fliers" like this - will get sold off pretty hard when the market finally enters a phase of "capitulation" (the weak stupid hands toss in the towel). PICK AWAY if possible. Don't plunge...

Pay attention to CHINA.... They've been the big buyer of OIL -- and COPPER - and WOOD - and many building commodities for the last several years. If they're not buying - then those prices will get hammered... We'll want to see good news out of China for many market segments for GROWTH.

Classic buy high and sell low strategy!! LOL


I know you're kidding - or - I certainly hope you're kidding.


This kind of market is EXACTLY WHY I push the DIVIDEND INVESTING theory! You get paid (or the dividend buys more shares) to hold thru bad markets.


I just posted that I was on a 6 day - very rugged - rafting/camping/kayaking trip in the wilderness..... and what happened while I was completely out of touch? The market had some nasty selloff.... but more importantly three companies deposited over $30,000 in my account (dividends). APU paid me $11,960.00 -- ETP paid me $15,525.00 and KMI paid me $7350.00

THAT is why I urge you to build a base of great DIVIDEND paying companies!!! Did I have losses in the face value of my shares? Sure! But I'm not selling so the value this moment means little to nothing to me. They're MAKING ME MONEY every quarter.

Hey Greg,
Let's say COP or CVX or whoever cuts thier
Dividend. Do you sell?

PS nice raise from MO.

John

Yeah me to. KMI gave me 1/3 of share....... SWEET