Okay -- Which one of you guys bought TNH?? And killed my run for the day...


:rofl: :rofl:


To BC69:


All "interesting" but not really relevant to the small investor and not "Investing 102" (beginning investing - so super basic). Don't take me wrong here - what you're saying is great information and I certainly hope you continue to add to this thread... but you just did what all Wall Street guys do... You made very complicated reasoning/statements for what is a very simple idea.... which is for the average person... with a longer term horizon (let's say longer than 2 years)... to start to invest. That's what we've been discussing for 89 pages. Get started - here's some basic info to look for etc.

Several of us have been pounding the tables about keeping investing to pretty simple basic steps - buy best of breed - good long term charts - with good dividends...

Once you introduce all manor of calculations and EBITDA - and cash flow models and blah blah blah... the AVERAGE investor will quickly out think themselves.

I'm merely asking people to get involved in their own finances -- it's not complicated -- and if they keep it simple -- they are perfectly capable of of handling the job. I'm also using my own personal investing as examples... and I'm running millions of dollars in my own accounts. So I figure if it's good enough for me... it should be somewhat helpful to "others". It isn't complicated and if I can do it (and have been for 30 years) so can everyone else.

The last line in your post is exactly what we've been talking about... with the couple of additions I stated above (i.e., buy best of breed companies).

Greg -

Believe me, I am all about getting in and holding, I am young, I can sit on losses for 15 years for all I care until they turn black. That's why I finished with that line. But I do think even in picking the long term holds you maybe need to dig a bit deeper. Understand secular vs. cyclical trends, what risk factors lay ahead, competitive positions, and I believe alot of that is priced in, and shows up in the multiples.

Being on the private side, I couldn't trade single name stocks, so I am full of index ETF's which I will hold for a long time. Now that I get into single names more I use much more caution.

The theme here, I get it and support it, just as I saw more and more posts about individual names and not around philosophy I put in some caution, and it certainly gets complicated, but I think having that in the back of your mind helps.

Tim

AH HA! Yeah -- I caveat those "individual names" with === THIS IS JUST AN EXAMPLE.... we're not really trying to discuss the individual names. I use them as a teaching example. For instance -- my post about the "EX DIVIDEND DATES" that I can find in Seeking Alpha.... it's not about those names but rather about what information is available SHOULD SOMEONE WANT TO KNOW...

We've been hammering dividends - and there's all these terms used -- so things like this is good info (IMHO) for Investing 102... How they're paid - when - what to look for etc.

It's easier - I think - for someone to see by using a real life example. I think people get it "more" than just a broad discussion about theory etc.

I often find myself wanting to dive into a deeper discussion -- and actually spend a lot of time typing up a post only to delete it because when I read it before hitting the "submit" button -- it's not really relevant to the "102" basis this thread is about. While I "know" it - whatever it is - doesn't really mean it serves a purpose here. It's kinda like posting up about EFI in a guys thread when he only asked about adjusting the idle screws on his Holley... :willy: :lol:

I've been holding back "too much" info - until someone asks about it.

I can say - this has been a fun and rewarding (for me at least) thread. Just to see people interested and talking has been just huge!

I knew the entire time I was typing that it was going to fly over some heads like you say! Haha. It was more just "hey - lets remember it gets complicated". Because I think we all know some of the standard adages were blown to the 3rd standard deviation in the recession.

Not to take away from BC69, who sounds like he has more knowledge of Investing than I, but we do need to talk about all ideas of investing, we also need to keep this thread at its core, which brings in people to talk about investing..

So KISS is important.

Otherwise, we can get too confused to ask, or comment.

I too , am one that is using what I see as long term trends, to fuel my Investments, and Monetary policy and Commodities are some tools that I use.

Also I am not invested in individual stocks by choice, but that may prove great, or it may prove not so great. my choice..

But BC69, please continue to posts thoughts and Ideas.That is the whole purpose of the thread.

I am luckier just being in the right place in history in 2008. So I have much to learn.

Yes, you flew right over many of our heads...

Greg - quite a reversal today on your ex-div stock... and the market overall.

Love this thread !!!!

Yep -- and it's why I purposely posted "Paper gains".... they come and they go... but now instead of a $59 grand paper gain I'm down to $30 grand...

:lol: :willy:


I remember when I put new money to work around February 2011 (the account that I use for examples here).... and it went straight up about 200K.... and 3 or 4 months later (summer swoon) I was DOWN 200K.... so a 400K swing... but... always the big butt... I continued doing what I know works "most of the time"... bought a ton of stuff during the swoon and by Xmas I was up 335K (not counting any of the dividends -- we're just talking paper gains). We all know that since January 1st it's been off to the races.

I "pitch" DIVIDENDS because that is REAL MONEY.... money that I actually spend (quite liberally as you all know! :D ) and that keeps coming regardless of the paper gain or loss. That's why I like them!

I keep pitching them in this thread because they're particularly useful for guys just getting started and because they buy shares when the markets are lower so they're automatic savings.

And we love you!

:lol: :lol:

Too bad you didn't sell it prematurely like APPL.





http://s3.amazonaws.com/advrider/peepwall.gif

Sorry GW, couldn't resist

Oh.... I only left about $192,000 on the table on that trade... I've done far far worse than that!

:wow: :wow: :faint: :rolleyes:

So far................:unibrow:

lol, you guys are awesome!

My Roth account stuff is approved so I just need to make a phone call on this first deal to get the money moved. Hopefully, I'll have a day this weekend to take a looksee at the stocks I'm interested in and make my final selection.

In the meantime I made another donation to my online savings account which has earned me mega bucks since the beginning of the year. $29 dollars to be exact.:woot: :cheers:

Good for you Trey! :thumbsup:

There ya go!!

Don't ya just love those .25% "savings" accounts! But hey! On the bright side this allows the banks to loan us money for "only" 4%!! LOL

I never look back....:lol: :thumbsup:


Did you read the post about my 20 million dollar "yacht"? Or my 10 million dollar "house"? All that Microsoft stock I sold in '88... or '89...or '94...
OMG.... It's way to painful to look back.

Again, it isn't the value and total at a given time, but the dividends and income stream...

After all of 2011, i am still up, and i took a paycheck every month, and 10K extra to play with...Still up from my start point after all that...

High 5 figures in yearly income, and not hundreds of thousands, but still living nicely. that is why ,other than dividends, it is called unrealized gains...

Just to say that the power works.. me the little guy , was up and down 20K at times, per day up or down...per day , in 2011 !!! For me, that is a lot, especially if it went for two or three days.. but i stood the course...:cheers: :lateral:

Clean up on isle three....clean up, on aisle three...:cheers:

I am playing devils advocate, all in good spirit, as I probably came off way negative in my first post, but hopefully keep people thinking.

Why dividend stocks vs. corporate bonds? If the focus is the stability in real cash return? (And maybe its, again, trying to keep things 102 and simple).

Take JNJ (Johnson & Johnson) - on a capital gains basis, over the past 5 years the stock has moved alot in terms of volatility, (so timing would matter) but to the day 5 years ago. It was $64.15/sh today is at $64.94/share. Essentially nothing (less with inflation right?). BUT you are earning a 4% dividend yield (annually). Greg has shown how that is cash, its real, its great, and it beats the hell out of a savings account.

But JNJ also has bonds outstanding. The secured debt for a 2016 maturity will earn just above the dividend at 4.7%, a 2021 maturity - 7%. These rates are semi-annual, so there is a small amount more you earn because of compounding.

Yes, bonds are boring, getting capital gains out of them is rare and thats really just getting a higher implied yeild (I know there was a post on this).

But mature dividend stocks generally dont get you much capital gains either, as we discussed. Thats the nature of becoming a high dividend business (you start paying dividends when management and investors believe the capital is better off going to sharholders than into the business). But they come with more risk.

I know we could never imagine JNJ going bankrupt, but 15 years ago did we imagine Sears or Kodak? High dividend mature stocks. We didn't see that coming.

If I owned Kodak stock, I would have initially lost that income stream as they cut dividends to conserve liquidity. And then I would have lost my initial investment completely as the equity holders are last in line.

If I owned the secured bonds, I would have still received my income stream the entire time, and in depending on how bankruptcy comes out, generally over 90% of my face investment.

So yes, its boring, but if we have a diverse portfolio with some growth stocks, and some dividend income stocks. I would say consider the bonds there too as a substitute for the income portion of the portfolio. Assuming everything here is for a long term hold.

I think in summary, the security + the higher income stream can in some cases offset the potential cap. gain + risk of the underlying stock.

Just food for thought. Both great options to earn above savings rate with limited risk.

Yes. It is a Great Thread.:lateral:

I was just thinking a few things this morning.

One is Dividends were paid overnight again. Not much, a few hundred bucks, but hey, it is money.

The next is that this thread keeps going, and that is a blessing just to keep people thinking. All all other sites, when you talk about money, or someone asks about it, it turns into people thinking you are bragging about your money..

Far from it... I am a guppy compared to Greg, and some people would take him talking his numbers as bragging, and it would go south quickly. Yes, his numbers are mind boggling, but i commend the grown-ups on this site that are truly looking for Opinions from those that have and do...I call it, the Success leaves Clues method..It will speed up your learning curve by taking in those opinions.

Next, Since my method is the same , but my Choices are different, I have been Re-Researching all my Investments, just to see where I am at.

I did it by looking at what I owned and the 3 and 5 year Total returns, the Dividends paid, and it's strength long term against it's competition..

That best of the breed, long term numbers, and growth for the future..

For me, all is working good, but just saying that using the methods talked about here work, whatever you end up choosing.

Also, if you don't have a Schwab account, get one.. You can research and get all the numbers you will ever need to make your choices, and they are reasonable fees.

Thanks Greg and others that keep this alive... I have stopped talking Investing in other places...Seems like they don't want to hear it..

BIG mistake and missed opportunities..Also depending on Pensions, and the Government, is a dangerous Play. For me, it is a Worse play than my High Yielding assets..:cheers: :lateral:

The calculation you left out of this is TAX RATE Differential.... Corporate Bonds are ordinary income tax rate.... Dividends are max tax (right now) at 15%

Makes a HUGE difference in the yield.

BIG difference..What like 30% plus vs. 15% ?

Taxes are HUGE in money management. Things I am still learning, but I know play a large role in the strategies used.

Again, thanks for the tip.. :cheers:

I just try to give the troops smaller numbers to think about, so that it all seems possible with research, action, and time..

Maybe this goes beyond 102, but one thing which might be a good topic to discuss is INFLATION! Just read this article and thought it might be a good discussion point for this forum and how to consider this in diversifying your portfolio, or where "parking" you money may change over time.

http://moneymorning.com/2012/02/16/i...-on-inflation/

Ah, good point. Still in the 4% vs. 7%. $1000 Investment. $40 for dividends ($34 after tax). Or $70 ($47 after 32% rate). I can see the shorter maturity bond being negated by the taxes, but still have security factor.

But totally right, if this is an investment account and you take that out to use yearly, taxes impact. If its a long term account, ROTH 401k or IRA, taxes will be a mute point.

What made me think of this was that my old boss, his father in law lived off of dividends from his old company (a large cap industrial mature business), and in 2009 they cut the dividend to conserve capital. Had a huge impact on guys like that, massive! Bond holders kept their income.

Also, another lesson in diversification right.

Good post! And yes -- EVERYONE reading this stuff needs to remember what type of accounts they're "investing in"....

I personally have a large Muni bond laddered portfolio - which yields just over 4%) for the income stream and safety (I'm 58 - retired and have been for 20+ years)... so a safety net and the tax free munis "fit" for me... countered by growth and income in securities (stocks)...

Personally I have corporates in both accounts... and some of them are real good interest rates - like 7 and 8%! But of course in my case that's a taxable interest so I invest in these and look for the higher rates.

Back a few pages = I posted the taxable vs tax free "tables" showing equivalent yields needed depending on the tax rate.

It's VERY IMPORTANT for the "newbs" of Investing 102 not to get confused in these discussions.... you've got to think about what account you're taking action in and it's affects.

Brian ---

GREAT POINT!

This is where a guy could launch into a discussion about bonds vs securities (stocks) and GROWTH vs Income stream.

I just mentioned in the above post that I have a Muni bond portfolio (about 30% of my investable assets).... So here's a good point to discuss. This account -- should interest rates remain "stable" will spin off income (4% ish) but will basically have zero growth in CAPITAL. The bonds will mature at their maturity dates and I'll just get my money back....

BUT... that is ASSuming that I "hold" the bonds to maturity. Which I plan to do. I'm only laddered out 5 years - as of last year - so to 2018. Each year beginning this year (2012) I will have one 5th of that account "mature" - we will then use that cash to buy bonds that that mature in 2019 and so on.

Here's the problem with that.... you have no growth in capital - and if I can "only" make 4% interest (tax free) and inflation is running at 3%.... I'm really falling behind.

What I've done personally is to keep a larger majority of my investable assets in securities which - if I do it right - will keep me even or better than the inflation rate. That's the "TOTAL RETURN" that I keep banging on. If you don't have that -- you're going to be falling behind more and more every year. That the BALANCE we've discussed.

My balance is - some safety (at my age) - in return for a tax free dividend/interest income stream... while taking more "risk" in the stock market... and attempting to get a higher TAXABLE dividend stream from those investments.

If you're in a ROTH / 401K etc... this is kind of a mute point - because you won't have the tax issues ("yet" -- remember the 401 is only "deferred") and you won't have any taxable event with the ROTH.

If you're reinvesting the dividends from your stocks... and you have growth in the capital (total return) you should be "okay"

I got a good laugh today when Schwab sent me an email that my 2011 1099 tax form was ready... okay I thought - I'll just print it off... HA! It's 58 pages!

I'll let 'em mail it.

:rofl: :rofl:

What the heck guys -- I go off to Run to the Alamo -- and you all quit talking/posting... what's with that!

Come on now - let's get some new energy going!

Ya wanna go racing with me - that costs money - so ya gotta make some!!!

been pondering my next move. got my statement on one of my investments the other day and wow it made me 10% in one month. i was like, this is awesome, then i remembered it lost about 5% the previous month. oh well. glad i don't need it now. want to buy some more stock, just trying to figure out what.

Well I was reading about the MLP's and their advantages in seeking alpha today.

Things I already own, but good to get more info on the advantages ..

Wife and I were talking balance today... How much to spend vs. Save..

I have set the numbers way out on our portfolio, and we are looking to make sure to not leave too much on the table..

I would love to just blow some more cash, but not yet..

Investing for the future, and enjoying today... We crunch the numbers every January, and then a major review every 5 years..

But Time has compounded things quite well. People think they may have missed opportunities already...

Not so, Time and the income stream is on your side..

Money made while you work, sleep, or race Greg...:cheers:

Investing is like that -- it's not a straight line up -- it's a two steps up - one step back - one step up three steps back but that's why I always ask you guys to go back - when in doubt - and look at the charts (3 and 5 years) and see what that tells you....

The average is about 11% a YEAR.... so to go up 10% in a month means you're going to get clubbed somewhere along the line. Trust me - it's REAL REAL hard to beat those "averages". There are pros on Wall Street that get paid millions per year to try to do that and most don't!

Well -- this is all real easy in a bull market.... I look at the charts showing the big dipper in '08/'09 and that's a valid reminder of what CAN and DOES happen... I know lots of guys that were down 40% because they had too much invested and didn't keep any out of harms way... then they had to sell in a down market ---- and then couldn't buy in that down market either...

To take a quote from a great movie --- "big mistake! HUGE!"


:cheers:

Last year was a true test of staying the course...400 and 500 point swings..

several days of drops... but in the end, where are we ? Up and dividends got paid..

I think it again is TIME and the gains over time because you picked the better or best...

i certainly don't pick the asset with the worst 3 or 5 year average...And by picking the one with the better average, even when you take big hits, you still come out on top..In fact, buy more when things have a correction.

7 to 10% is a lot ,once you have enough working for you.

Totally agree with you .... and that dividend being paid is what carries you over the lows... that cash just keeps going ka-ching!

EEEEEEEEEHHHHHHHAAAAAAA

Yes Sir...And You are right on not being too invested in one area..

I try to be ready to weather the downs and also keep enough liquid assets, not cash, to buy at those depressed times. I believe that as in 2008, I am not in a panic position to need to sell..Money management in personal life really helps..

I could have made a lot more money in the last few years, but I wanted to just keep the income stream going rather than swing for the fence..

Hindsight says it was the best move, and not buying dirt in the mid 2000's , turns out to be genius..

I've used this thread to get my IRA back on track with a diversified allocation -- some income, a good chunk of growth and some speculative stocks (a couple biotechs).

And I've enjoyed getting back into this and spending quality time each day researching and reading. I forgot how much I enjoy it. These damn car forums pull me away from these essentials too much sometimes. :D


Pretty Woman?

^^^^^^^^ Winner!!


I'm still in Texass boys! 4 days here for one day of running in the rain...:faint: but off to Phoenix this afternoon...

Morning gents...

Hope all is well.

The path of things to come are playing into my Hands...

I don't like the direction things are going, and many people hurting will hurt more due to the rising costs, but Large paydays have been , and will continue to come..

And to Greg's point of not being greedy in one sector, you gotta have stay blended and not heavy in one area.

I have one fund that has risen 25% in the last few months...For me a lot of money making a lot of money, but I cannot increase my stake in that asset just for the gains...

I have a mix I am sticking to, and those higher yielding assets are just that.

Kinda like Flash and the BIO stocks, but not BIO.. But If we get greedy and shift too much over, BAD things can happen..

So while i want to be in hyperrichness.my word...I must continue a somewaht safe and prosperous path..Because i still see large swings and volatility coming, but 2011 gave us a view, and feel of what that is like..:lateral: :cheers: :woot:

Safe travels. Eat a breakfast taco before you leave. :)

This is a very imporant point Greg and one I don't think has been brought up in here yet. I'm wondering if you regularly compare your portfolio to some sort of benchmark, be it the Dow, S&P, or other various indexes? I always think it's good to know if all the research one puts into buying individual stocks pays off over just buying an index ETF for a corresponding industry.