A very well written - easy to understand - article on "when" someone should invest - or wait to invest - or rather NOT wait to invest ----- and or be sitting on cash....

I can't tell you how many opportunities and how much time I've WASTED sitting in cash.... which is why - if you go back and read some of my posts - I don't really sit in cash -- I use a couple two or three "parking" spots for cash. The key to parking money in cash is not to fall into the "it's invested" and forgetting about it trap. NO NO -- Don't you do that. This isn't a game - you can not afford to fall asleep!



http://seekingalpha.com/article/2028..._str_0_2&ifp=0

So I've been sharing what I've been watching and buying in my IRA account with my Wife. I also set up Edge IRA and Roth IRA accounts for her and transferred the cash out of her managed IRA accounts over.

She asked me the other day when she can start investing with her accounts? So I sent her a few links on SA and gave her some of the general guidelines that I've learned from here and what I'm working on. next thing I know she's got a user profile setup on SA and is looking up stocks and sending me links on things that she is interested in.

She kept asking me, what does N\A mean in the dividend field on companies she's looking up. :D

I finally sent her the link to DRIP and the latest dividend champions list and guided her in that general direction. She hasn't made any choices yet but I'm happy that she is interested in taking up a roll in this and wants to participate.

I am still less than an 1/8 of the way in...and am biting my trigger finger hard. I did put an order in today for more KO at $36 just in case it makes another dip when I'm not around to take advantage.

Good for you Lance! And kudos to her!!


The thing that people don't understand about investing -- it CAN BE FUN!! It DOES NOT have to be nerve wracking! Checking stuff out - making GOOD decisions - thoughtful decisions - watching stuff go up and down - but eventually mostly up -- and getting checks.... it's GOOD STUFF!


Trying to game the market - sitting on pins and needles - being freaked out when the market goes down 3%... GAMBLING... nail biting.... THAT IS NOT FUN!

We all discussed TESLA (TSLA) a few times -- and my thoughts were -- Yeah I'd buy it IF I wasn't already retired and living off my dividends and income.... BUT that you also had to be willing to really go on a ride. Whatever that was going to look like -- because the shares sell for far in excess of earnings -- and you're gambling on how well their next model will sell... and on and on.


Here's why I'm bringing this up -- they closed DOWN almost $11 per share at the market close --- and more importantly -- they had a 35% SHORT interest. So 35% of the total outstanding shares were SHORT - meaning people were betting that the share price would FALL....

After the close - they reported the quarter... which was STELLAR.... and the shares have risen "after hours" $30 isn per share.... that's a $40 per share difference from the open today - the closing price - and the after hours price.

If you are short TSLA -- you just got your ass handed to you!!

While I'd like to be a holder -- I just can't gamble like that anymore... but maybe I'll buy 50 shares... just because. HAHAHAHAHAHAHAHA

The kind of market we're in right now -- is EXACTLY WHY I favor dividend investing. Nobody can make heads or tails out of the direction of the market... One day it's hot and all the next week you die the death of a thousand cuts.


If I showed you some of the dividends I've gotten this quarter -- you'd see why I could care less what the market is doing day to day. And that's the space you want to get yourself to. Positive cash flow. That's what counts day in and day out. Cash coming thru the door.... Your investments are just the vehicle used to make you money -- and that doesn't mean the investment itself always has to have appreciated.

Like I tell my accountant -- "I" APPRECIATE the money they earn. We always get a good laugh out of that - but it's absolutely true.

A good read today in Seeking Alpha.... because it directly RELATES to smaller investors IMHO. Not taking into account the author is writing about one particular stock investment he's made --- rather --- it's his method. A good one I think and of use to many of you.

I picked up the article mostly because it was titled 5 year review... that is an investor... 5 years not 5 minutes or 5 days.


http://seekingalpha.com/article/2031..._str_1_1&ifp=0

I've been waiting to be able to make a post like this...

I just got a raise!!!



The Board of Directors of The Coca-Cola Company Announces 52nd Consecutive Annual Dividend Increase
5 comments | Thu February 20, 2014 10:30 AM|Business Wire | About: KO
Increases Quarterly Dividend by 9 Percent

ATLANTA--(BUSINESS WIRE)-- The Board of Directors of The Coca-Cola Company (KO) today approved the Company's 52nd consecutive annual dividend increase, raising the quarterly dividend 9 percent from 28 cents to 30.5 cents per common share. This is equivalent to an annual dividend of $1.22 per share, up from $1.12 per share in 2013. The first quarterly dividend is payable April 1, 2014, to shareowners of record as of March 14, 2014.




I didn't get to pick up the extra shares I was looking for on the drop after earnings, but that's alright...I'll take the raise. :D

This is EGG SACK LEE why people have to quit trying to be market timers. You just do what you can do - regularly - and let the chips fall where they will.

It's also why -- and I'm not a "chartist" - not in the least - but I have to constantly remind myself - via the charts - that regardless of all the gyrations stocks go through -- the charts show me "lower on the left side and higher on the right side". The longer the view - the more pronounced that usually becomes. The tighter the view - the more freaked out a guy would get! Holy Cow! Look at that "huge" dip there! FUGIDABOUDIT!

Buy good stuff - don't gamble - get paid to wait while the market sorts itself out - average in and average out. If the market takes a huge dump - prepare to buy MORE again averaging in steady as she goes - because the market always seems to come back higher each time.

The whole notion of the world is about to collapse - is just that - a notion. Even during the great depression - people made fortunes. They just happened to be the ones that took advantage of all the sellers. LOL


More importantly!! Don't ya just love getting money for nuthin'!! Your boss didn't just give you a raise... certainly not a 9% one!!

Good for you Lance.

Woohoo!

Hey, thanks for the good news, Lance. I didn't know I got a raise. Sweet!

Kinder Morgan Partners (KMP)
 

This is a name that has been discussed many times - as usual used as an EXAMPLE - which is not or ever intended to be a recommendation to buy or sell... because that's not what this thread is about. It has been discussed because it's a MASTER LIMITED PARTNERSHIP - which is different and taxed differently that a normal stock.


In full disclosure I own 22,000 shares of it.


Barron's came out with a negative article about it this week. And the shares are getting hammered. I'm writing about this because SOMETIMES this is what happens to a name you might own. What to do about it is what you need to think about it.


Some times it creates a wonderful opportunity to buy... either average down or just add to a position. Think about NETFLIX when the CEO came out with a big public gaffe and the stock absolutely plummeted. That was a HUGE opportunity to step in -- and if you did - you've gotten a 4 bagger (400%)...

Some times the negativity might have a real basis - and might very well be just the prick of a pin in a balloon.... and that's when you WOULD NOT want to try to catch a falling knife! I've tried to catch a falling knife... it doesn't buff out.

What you should do before taking any action - buying more or selling - is to try to dig deeper and read as much as you can PRO and CON.... and then maybe choose to do NOTHING... or choose to take your loss and sell... or back the truck up and buy.


Here is how Richard Kinder (CEO and Founder) responds to the article...



" Like now, back in 2006, we had an enormous backlog of projects. And like now, many experts will find that we were too big to be able to continue to grow at an acceptable rate. We proved the doubters wrong the first time around, and I anticipate the same result this time. Reflecting this belief in the Kinder Morgan companies, as many of you know, I’ve been a buyer of KMI shares. I’ve purchased over 800,000 shares in December alone. So I guess my message to those who saw the story less positively was you sell, I’ll buy, and we see who comes out the best in the long run."
-- Richard Kinder, CEO on the Jan 15, 2014 Q413 conference call

On Feb 20, Kinder revealed that he bought 100,000 more shares at a cost of around $3.3 million.

I've been watching this Greg for a while, but am a bit confused on one thing. Since I'm assuming you are in tune with the companies better than I, can you expound a bit on the difference between KMI and KMP please?

I've owned limited partnerships in the past and am aware of the tax consequences, for simplicities sake would rather avoid that aspect of it but at the same time, it doesn't totally scare me away.

On the same hand though, if one could dip into the same pool with KMI without the LP aspect that might be interesting as well.

Lance ---

I never want to turn this thread into a stock pickers platform... but your question is the difference of how a stock is handled -- tax wise and therefore fits this thread because it is an important aspect.

KMI -- OWNS KMP (actually I think MANAGING PARTNER) is the correct description. As such KMI gets its "income" via an agreement with KMP. It is therefore a "stock" - with normal capital gains and dividend treatment.


KMP -- Is an MLP (Master Limited Partnership) -- and as such spins off it's income/profit back to the "partners". The "distributions" (not dividends) are treated as a RETURN OF CAPITAL. So this is a special tax treatment. And therefore are TAX ADVANTAGED.

I've said it here before - that there's no reason to own tax advantaged stocks or investments inside an IRA or ROTH etc.


Most "Limited Partnerships" are not very liquid. For instance - I own apartment complexes that are set up as partnerships. The Managing Partner is the operator - the "investors" have little control of how things are run or when the buildings might be sold and so on. I would have a hard time getting my money out of this type of investment. The MP might sell in next week - or maybe 20 years from now. Even as the largest investor - I would have little say so. I'm in for the ride.

An MLP traded on the stock market is LIQUID - since they're publicly traded and you can get in and out. But the tax advantage remains the same.

Thanks Greg, I'm assuming that KMI has other "investments" that it owns besides just KMP?

We've set up Limited Partnerships up before as a way to create Passive Income to offset Passive Losses...so I'm well aware of the structure and why it is used. If you know who the managing partner is and you are all on the same page, it can be a real nice tool. Owning one can certainly add some additional Tax Return calculations though.

In fact, the very first shares of stock my wife and I ever owned were of a LP. She worked at the time for ChemLawn who was owned by ServiceMaster at the time. She received shares of ServiceMaster in her 401K as contributions that eventually rolled into her current IRA. Helluva way to dip ones toes into the stock market for the first time. :headscratch:

KMP in a roth
 

Greg first of all thanks for all the information you share in this thread. It is very enlightning for me. You mentioned that having a MLP in an IRA or Roth provides no advantage but what if any disadvantages do they have?

Brian

:thankyou:

Google "KMI vs KMP" and the first link in the results is an article from Seeking Alpha which pretty much answers that question:

http://seekingalpha.com/article/1901...vs-kmp-and-epb

Greg,

It always seems much harder to know when to sell than when to buy. Using your KMP for example...You own 22K shares of KMP, and the stock has been trending downwards for the past year when the market's been going straight up, and this latest news brings it back to early 2011 levels. You're still making 6.x% on the distributions which is great, but what exactly would you be looking for to convince you to sell and reallocate to something that might be a better performer moving forward? Is it a specific level, or specific news, or a downward trend of X number of years that under performs market or similar stocks' trends? Of course, if you bought KMP back in 2000, or even 2005, you're doing great on both growth and distributions, but I'm just curious about the triggering event to sell. In this case, it appears you're not bothered by the recent news and will hold, but what would bother you? :)

Thanks for all your input.

-Chris

Great question --- Not sure I have a perfectly direct answer. I sold my position in McDonalds because I don't eat there anymore - rarely - and when I did - I wasn't happy with the places or the food....


Kinder Morgan is about a 100 BILLION dollar "entity" if you factor in all their businesses. Energy prices are often volatile... and as we all know - you have risk from a pipeline break - or some environmental issue etc.

So here's why this is hard to answer. Because it all depends. Depends on why someone is holding the issue. I'm holding it because it pays me $30K PER QUARTER (29,500 actually)... which is very nice cash flow on one single holding. I have added to the position as it's slipped down. I'm currently underwater on the holding - but not by very much. Given the cash flow it represents to my portfolio... that's the trade off. If I sold it I'd have a LOSS -- and then would need to find a replacement for $120K per year. So for me - that would be a MAJOR factor. What else can I buy at todays prices - with that cash flow - that I would TRUST to not only make up for the loss - but also not go down (EVER? like that would happen). So until there is some FUNDAMENTAL reason -- I'm a holder. At the value of this position - I'm not going to ADD any more to my position. I have plenty of it.

In other words -- the CEO is a major holder - he's putting his money where his mouth is. Fundamentally the company and the way it operates hasn't changed. What changed is somebody wrote an unfavorable article. The company will still be there 6 months and 6 years from now - when the article is forgotten next week.

This is a long term holding for me - and todays or tomorrows price isn't a consideration for me and I don't see an issue with the company that currently affects my thinking. I've been wrong before - and might be this time but I'll stay the course in this one.

I have about 5% in KMI. I saw the article and knew what would happen today. At this time I plan to ride side car with Richard Kinder.
On a different note my CVX was up more than KMI was down today. :)

Thanks Greg. I really appreciate you taking the time to share your insights on that. I was actually going to buy some late today right before close, but got a little nervous when I saw the trend for the past year. I already own some ETP so I want to be sure not to get too heavy in that field. I was thinking of maybe something like NYCB as a substitute for KMP with a similar dividend and decent track record with their dividends. KMP might be a better value though given what you just mentioned(down on basically old news). Will see what happens. Have learned a lot from you. Thanks again. :thumbsup:

Man, good stuff as usual. And as usual, i've have nothing to say.....but :thankyou:

BitCoin -- again....
 

Can't say you weren't warned... at least not if you've read this thread.




http://money.cnn.com/2014/02/25/tech...mtgox-bitcoin/

Bitcoin player just got bit :rolleyes:
--------------
This market is entertaining, my good stocks are off 0.20% this morning and my risky Game Stop purchase is up 6% :knock: :D

When you understand how the market works day to day -- please post it up so I will finally be able to figure it out...

I will...........right after I hit the MegaBucks jackpot.

By the way -- My point was that does anyone really know or think they know why the market works the way it does... I certainly don't. One week you're clicking on all 8 -- the next week the market is going up and your stuff is all going nowhere... They report bad news on the TV and the market goes up - they report good news and the market goes down.

I've never been able to get it.

Let's just look at Microsoft the COMPANY -- they just kill it in profit - sales - money in the bank... and Microsoft the STOCK goes nowhere for 10 years. Go figure.

Another money losing company has a decent quarter and the stock puts on $10 a share. Go figure.

Every new investor should read these -- every experienced investor should have them in neon on their wall.



http://www.marketfolly.com/2009/09/t...tt-quotes.html

This is basically in a nutshell...what drove me from the market in 2011. It just didn't make any sense, especially to an analytical person like myself.

The Steady Eddie dividend income investing approach is different though...as I have been shown.

The wife made her first purchase yesterday, I walked her through putting the order in on the phone. The company announces earnings today...should be interesting to watch her response.

The variables are impossible to chart as the fluctuations appear to come from a multitude of news sources, industry and market rumors, and speculative opinion to list a few. Negative news appears to create more movement than positive news. Solid performance doesn't make for good headlines even though it may be a shoe-in for the Hall of Fame.

"The fact that people will be full of greed, fear or folly is predictable. The sequence is not predictable."
~ Warren Buffet

Dividends and "best of class" and Total Return is what will make you money longer term and get you a good nights sleep. Let the gyrations be what they will because nobody can guess what they're going to be tomorrow or next month. I like to FOLLOW the market... I like to be AWARE of trends... I want to be INFORMED...

I used to absolutely freak out if a stock I owned went down a dollar. Never mind that the dollar was .02% of the value... That was it! SELL! SELL IT ALL!

That is a great way to go thru a lot of money. Because then the next day it would go UP 3% and I'd buy it all back.

That was back in the 80's and 90's... I've learned how to make money since then.

Here's exactly what I was just posting about!!


Check out the move in Sturm Ruger (RGR) the gun company.


The earnings and profit and sales just reported were absolutely off the charts good.... the Stock however is selling off $5


Would ANYONE think that if a company grew 40% - that their stock would sell off. Go figure.


Again - we are NOT using names to discuss their particular merits of ownership - it just happens to be a perfect EXAMPLE of the market and the thinking etc. I DO NOT own this but know that other readers do. It's been a terrific growth stock.

Well, her stock came out with terrible earnings...and is up 4% on the day. :EmoteClueless:

So she bought Target (TGT)....


Probably a good buy in time since the news is worse than the long term growth of the company. It just doesn't pay enough dividend % for me but the growth has been stellar!

;) It fits into the buy what you know theory perfectly.

I told her while she was looking at it to pay attention to this...Do you still like shopping at the store, do they still offer everything they offered before, are the registers all staffed and the store kept clean and shopping experience good?

If so, pay no attention to the new cycle items in regard to the breach...that will pass and the stock should come back as long as the shopping experiences stay the same as they were before.

There are other factors also involved of course, but it's a company that she knows and will keep an eye on from the customer's perspective.

And that is the PROPER way to invest!!!

Here's something else for "newbs" or for those that have some money and just can't find somewhere to put those employees to work.

Blackrock runs several publicly traded ETF's... Exchange Traded Funds.


They're basically Funds set up to do particular "work" - Dividends - Volatility (or lack thereof) - Gold - etc.


Here's Blackrocks website -- and there's a TON of information about their various funds.

http://us.ishares.com/home.htm


I have used their Corporate High Yield (HYG) fund for a long time to park cash.


So here's the way I THINK about this type of "investment" (an ETF) -- I use them for a purpose. i.e., I use JNK and HYG to place cash in and either pick up the MONTHLY dividend ---- or if they go up enough before the dividend - I might just take the gain (taxed differently!) - and sometimes I get the dividend AND the gain. But either way -- I do not think of them as investments. They're just placeholders. They're not buy and forget.

SOME of the iShares ETF's COULD BE investments...

I just hope none of you were in Bitcoin... and I hope you all understand WHY I was against this kind of speculation. While it's fun to be cutting edge - it's fun to be "the guy" that's into the hot new deal on the internet.... I totally get that.

What IS NOT FUN is losing 40% in a month! In ANYTHING. While this might come crawling back - and frankly - I can't even speculate whether it will or not - because nobody knows what it's going to do. Does the bankruptcy filing of MTGOX exchange cause a domino affect? Who knows. Nobody knows how strong the underlying exchanges are - they're unregulated private entities.

This has - for me at least - been a great example for INVESTING 102. The Facebook IPO was another good example... as EVERYONE (including me) expected this IPO to go straight to the moon.

Here's what the take-away should be from these. Sometimes the "sure thing" isn't.

There's nothing wrong with getting into this stuff --- as long as you understand and can afford the consequences when things don't go your way. That's the take away.

It's like a guy that hawks everything his can - to build a $40,000 twin turbo whiz bang motor --- and at the dyno - it goes FIZ BANG.... It would have been great when it made 2000 hp at 5000 rpms --- but not so great when the rod opened a window in the block. THIS GUY SHOULD HAVE BUILT A $10,000 motor and lived to play another day.

That's all.....

A really well written "history" of how bubbles grow and then pop... Always worth reading - so that you can recognize one in advance or know when it's time to be a pig and not a hog?



http://www.marketwatch.com/story/are...8?pagenumber=1

Something differant
 

So I am looking to try something new I have a good breath of funds in a portfolio
A chunk of individual really solid (as in 25 or more years on the div champs list) stocks that I drip
A chunk of looking for lightning stocks ("facey book" has doubled plus for me for example)

Now I am considering peer to peer lending. Google just dropped a ton into the lending club for example.

Interested in any feedback on peer to peer lending pros cons Ect ...

go. :idea: :idea:

I don't have any insight into peer to peer lending, but I do have a good friend that has dabbled in high risk loans for a long time.

He is now also a Bed and Breakfast operator in Colorado...and not by choice either. :D