Investing 102

[Woody]

Greg,

You have really opened my eyes to investing in stocks. Up until now I have been investing most of my retirement funds in mutual funds. I own six funds right now and have my money evenly divided between small cap, mid-cap and large cap funds. I was just doing some research on the ten year performance of my funds. The ten year total returns (including dividends) has ranged from 22% to 147% with an average return of 68%. That equates to roughly 6.8% per year (simple interest).

Just for comparison sake, I took 12 stocks, most of which have been mentioned in this thread and calculated ten year total returns (including dividends) The stocks included were HD, PFE, CVX, MCD, MO, KFT, JNJ, KO, T, KMB, PG and CAT. Ten year returns ranged from -2% to 383% and averaged 143% which is approximately 14.3%, more than double my mutual funds average return.

I have reviewed the stock holdings of my mutual funds and I believe I own all of the stocks mentioned within the mutual funds. However, the funds also own 100+ other stocks, some of which I have no clue as to what they do.

Anyway, this has been a real eye opener for me. Thanks again for your insight.

[GregWeld]

Originally Posted by Woody

Greg,

You have really opened my eyes to investing in stocks. Up until now I have been investing most of my retirement funds in mutual funds. I own six funds right now and have my money evenly divided between small cap, mid-cap and large cap funds. I was just doing some research on the ten year performance of my funds. The ten year total returns (including dividends) has ranged from 22% to 147% with an average return of 68%. That equates to roughly 6.8% per year (simple interest).

Just for comparison sake, I took 12 stocks, most of which have been mentioned in this thread and calculated ten year total returns (including dividends) The stocks included were HD, PFE, CVX, MCD, MO, KFT, JNJ, KO, T, KMB, PG and CAT. Ten year returns ranged from -2% to 383% and averaged 143% which is approximately 14.3%, more than double my mutual funds average return.

I have reviewed the stock holdings of my mutual funds and I believe I own all of the stocks mentioned within the mutual funds. However, the funds also own 100+ other stocks, some of which I have no clue as to what they do.

Anyway, this has been a real eye opener for me. Thanks again for your insight.

Fantastic work Woody!!

This really is so simple ANYONE can do it -- but somehow we'd rather "leave it alone" or ignore it altogether...

So you just summed up WHY I THINK MUTUAL FUNDS SUCK.... because they're not going to buy anything you can't on your own... but there PERFORMANCE will be pulled down because of DILUTION.... They can't just own the best of breed -- they're just going to buy EVERYTHING... because most are simply set up to mimic some "standard" -- whether it's the S&P 500 or some other index. Then they churn the stocks -- and charge you fees for all this... and in the meantime you have no idea what's what.

If you can buy 10 to 20 top stocks - you have a mutual fund. No fees. And you are in control.

Mutual funds were great for people -- they get a job -- and they can "save" $50 or $100 per paycheck... so they have a "place"... but you can do better on your own as soon as you have 10 grand or so.

[Bucketlist2012]

Originally Posted by GregWeld

Fantastic work Woody!!

This really is so simple ANYONE can do it -- but somehow we'd rather "leave it alone" or ignore it altogether...

So you just summed up WHY I THINK MUTUAL FUNDS SUCK.... because they're not going to buy anything you can't on your own... but there PERFORMANCE will be pulled down because of DILUTION.... They can't just own the best of breed -- they're just going to buy EVERYTHING... because most are simply set up to mimic some "standard" -- whether it's the S&P 500 or some other index. Then they churn the stocks -- and charge you fees for all this... and in the meantime you have no idea what's what.

If you can buy 10 to 20 top stocks - you have a mutual fund. No fees. And you are in control.

Mutual funds were great for people -- they get a job -- and they can "save" $50 or $100 per paycheck... so they have a "place"... but you can do better on your own as soon as you have 10 grand or so.

Again I am still learning, so bear with me. I really hate 401K and the Mutual Funds in them... Fees and terrible choices....

But in my Schwab self run plan, I do own , along with many other things, these Mutual Funds. I am not saying to buy them, remember , I am a novice, but I picked Great performers, but i am not sure if it is the best route..

I have the following

OIBAX,LSBRX,TGLDX,TPICX,SAMIX,TGINX,PTTDX,

I did the research, and these picks crush the similar funds of others.. But they are really cut up into a thousand investments..

But I am going to have to do so much homework after reading this thread...

[RECOVERY ROOM]

I now what you mean, Im looking at everything now because of the info hear....WOW. ( I take it that GW hates funds)

[Bucketlist2012]

Originally Posted by RECOVERY ROOM

I now what you mean, Im looking at everything now because of the info hear....WOW. ( I take it that GW hates funds)

Yes.. I truly believe that just doing the investing and research, and networking like we are doing, will be more than most will ever do...

With study and Smart work, we will do well...But with a little more effort and research, we can do even better, without being greedy...IMHO

[GregWeld]

Originally Posted by solarguy09

Yes.. I truly believe that just doing the investing and research, and networking like we are doing, will be more than most will ever do...

With study and Smart work, we will do well...But with a little more effort and research, we can do even better, without being greedy...IMHO

What I hate the most about FUNDS - is the comparisons -- because it's so hard to do... and there's so many BAD funds out there...

People say to me - man the stock market really sucks - my mutual funds are down 20% and I just want to slap them! Because somehow they think "their mutual fund" is hooked to the hip of the stock market... and they're NOT...

[Bucketlist2012]

Originally Posted by GregWeld

What I hate the most about FUNDS - is the comparisons -- because it's so hard to do... and there's so many BAD funds out there...

People say to me - man the stock market really sucks - my mutual funds are down 20% and I just want to slap them! Because somehow they think "their mutual fund" is hooked to the hip of the stock market... and they're NOT...

Being the novice, it is hard for me to compare my funds to anything other than similar funds of it's kind. But they are so sliced up, I can't compare them to anything individual ..

A lot of my stuff doesn't follow the Market...Heck, some of my Gold funds don't even follow the price of Gold...

So I am still figuring things out.. I am just trying to limit my errors, and any under performing..

but the process of learning, and the rewards of doing something, are well ....addicting..

P.S. If their funds are down 20%, they have the wrong funds...

[GregWeld]

Originally Posted by RECOVERY ROOM

I now what you mean, Im looking at everything now because of the info hear....WOW. ( I take it that GW hates funds)

Hate is not a strong enough description....

[GregWeld]

Originally Posted by solarguy09

Again I am still learning, so bear with me. I really hate 401K and the Mutual Funds in them... Fees and terrible choices....

But in my Schwab self run plan, I do own , along with many other things, these Mutual Funds. I am not saying to buy them, remember , I am a novice, but I picked Great performers, but i am not sure if it is the best route..

I have the following

OIBAX,LSBRX,TGLDX,TPICX,SAMIX,TGINX,PTTDX,

I did the research, and these picks crush the similar funds of others..

But I am going to have to do so much homework after reading this thread...

Here is the AVERAGE ANNUAL RETURN PRE TAX....

So here's the thing -- If I can get a 5% DIVIDEND annually -- that's near where your total return is on some of these! And that's discounting any growth in the share price! Still -- there's a couple good ones in there and if you can get 10% annualized growth rate - that's doing pretty well. Not great - but "okay". The GOLD fund -- TGLDX is the one that's gone exceptional... so lucky you IF you bought it 3 plus years ago. I wouldn't buy it now thats for sure because that would be to assume gold is going higher from here... and I wouldn't make that bet.


The OBIAX 10.47%

The SAMIX 5.29%

The LSBRX 9.71%

The TPICX since inception is DOWN 7.67%

The TGINX 10.04%

The PTTDX 6.47%

The TGLDX 23.80%

[GrabberGT]

Originally Posted by GregWeld

Fantastic work Woody!!

This really is so simple ANYONE can do it...

I read this last night while watching some TV and I swear I busted out in laughter. It reminded me soo much of one of those late night infomercial, get rich quick shows. You hear testimony from someone who's bought into the plan (Woody) and then host comes back to say "This is so simple ANYONE can do it..." soon to be followed by "...all you have to do is make 4 easy payments and I'll send you this highly valued packet of secrets to get you started." This just emphasis how valuable this information is we are getting here for FREE from REAL people who are doing it. Solid, non-biased information from great people. Thanks again.