Investing 102

[PDXFactory]

Originally Posted by GregWeld

Marcus -- I've had to delete several posts because I'd read them and go -- nah - to0 much info. This is "Investing 102" - so I've kept 'em super simple (which investing really is). But you're 100% right -- there's a ton of different investment "vehicles" once you actually have a little dough. Which, of course, adds DIVERSITY once someone feels the need to. I'm not sure at what point someone needs to be in much more than the three basics -- Stocks - Bonds - Real estate (other than your home). At 58 - and I've been retired for 20 years - I've just this last year bought bonds. It just somehow felt "right" to put some money into nice safe tax frees... but the lack of growth kills me... because I've always gone for growth! At some point though - a guy needs some safety. So I guess I've got one foot in the grave!

Ha...yeah, I had trouble only writing "a little" because there is a lot to get excited about when you learn more and see what is really possible! I really do hope that one of the biggest things people take away from this is exactly what you said - investing is really simple as long as you stick to the basics!

Retired at 38, huh? I guess I'd better hurry up...I'm almost 36, so I only have a couple more years until retirement. Ha!

Originally Posted by RECOVERY ROOM

Theres some good stuff out there you just have to keep your eyes open, If its national news you already missed the big gains..In most cases. If someone thinks they know something post it up, maybe we all can become the new power of the country !!!

Tracy, are you advocating the start of an official Lateral-G Fund? I'm liking the sound of that!

[GregWeld]

So here's a couple thoughts -- and remember that I'm really "exposing myself" personally here - but I can only use information and share that - from what I really KNOW... not what I heard from someone else tell someone else.


I was "reviewing" someones portfolio... at their request. Just a look and compare function.

They were in SONY (SNE).... Okay - great name right?! But the OWNER of the account only knew they were in Sony and that sounded great!

A quick check of the charts -- SNE is DOWN 64% over 10 years and DOWN 50+% over the last 5 years!

Compared to an investment in McDonalds (just to pick a favorite) that is UP 267%

So 100K invested in SONY is now worth 40K and the same 100K invested in McDonalds (at the same time - 10 years ago) is now worth almost 400K. (I'm not doing any math here - I'm just making quick comparisons).

Here's THE POINT.... his money is professionally managed -- so he never did ANY research for himself - nor did he even know WHY he was invested in what he was invested in! That my friends is total BS!! You going to buy a motor and not ask what's in it and how it was built and what kind of power it's making? One 454 could produce 300HP built for a truck - and another could be making 700HP... HUGE difference. Treat your investments the same way! Do just the minimum amount of research. You can check all this in Google Finance or Yahoo Finance - it's so dang easy just to look! It will pay off in the long run.

[Budweasel]

I see a new brand for instructional books. The first one will be: Investing for Gearheads

[billscamaros]

Originally Posted by GregWeld

Just go to YAHOO finance -- or Google finance -- and put in those symbols -- then go to a chart and look at 5 year or 10 year or whatever they'll let you choose for time -- and look at the chart for each one. You'll see all manor of ups and downs in the squiggly line -- but the basic course over time is UP... so if you can train yourself to IGNORE the "noise" = hold steady - don't freak out - collect those dividends -- add to your account when its down the most and buy MORE stock when it's DOWN... YOU WILL BE REWARDED in time.

So let me ask another question about the Google Finance charts. Looking at Duke Power (DUK) on the chart, I toggle the 10 year view and notice that in around mid 2006, the price went from $33.21 on 10.37M (shares?) to $18.74 on 34.68M (shares?). Does this indicate that the stock "split"? This would be a good thing? On the 5 year chart, it looks as though the price has remained steady .... I assume that this isn't the good growth that you're looking for?

I do have to say that I'm getting a little hooked on checking various stocks out on Google Finance.

[PDXFactory]

Originally Posted by billscamaros

So let me ask another question about the Google Finance charts. Looking at Duke Power (DUK) on the chart, I toggle the 10 year view and notice that in around mid 2006, the price went from $33.21 on 10.37M (shares?) to $18.74 on 34.68M (shares?). Does this indicate that the stock "split"? This would be a good thing? On the 5 year chart, it looks as though the price has remained steady .... I assume that this isn't the good growth that you're looking for?

I do have to say that I'm getting a little hooked on checking various stocks out on Google Finance.

What you are looking at there isn't a stock split - it's a dramatic drop in stock price! The other number is the volume of shares traded - I'm not familiar with DUK, but there was obviously a reason (rational, or not) that the price dropped so far and the market reacted with a lot of people trading a lot of shares. (One thing to always remember is that for every share sold, there has to be a buyer somewhere - while half of the traders were freaking out and selling, the other half was buying!) Charts are generally 'split adjusted' meaning it shows the graph as though the splits never happened to keep the chart easier to read.

(EDIT - you got me curious, and a quick search showed that in January 2007 Duke Energy spun off part of its business (forming a new seperate company called Spectra Energy, NYSE:SE) and gave each shareholder 1 share in SE for every 2 shares they held in DUK. This means that if you previously owned DUK, you now owned shares in both DUK and SE. The drop in the stock price would be the market response to this. It makes sense when you think about it - DUK should be worth less money now that the company is smaller, and the market reflected that. This is kind of a special case and isn't something that happens everyday!)

If you click on the 'settings' button below the graph you can turn a lot of the indicators on and off. Take a look at NKE or SBUX and run it out to 5 or 10 years and you'll see at least one split in there.

Make sense?

Marcus

[RECOVERY ROOM]

Tracy, are you advocating the start of an official Lateral-G Fund? I'm liking the sound of that! [/QUOTE]

MARCUS that sounds like a good idea

[GregWeld]

Originally Posted by Budweasel

I see a new brand for instructional books. The first one will be: Investing for Gearheads

Good one!

I like ---

Investing for life.... as in.... a better one!

[Stuart Adams]

Your last check should go to the morgue and bounce....

Your kids just fight over it, give it to them while your alive, so you can all enjoy...

Book called DIE BROKE..

[Sieg]

To reinforce Greg's advice:
11:16 AM Among the stocks making new 52 week highs as year end approaches are faithful big-caps across a number of industries: Wal-Mart (WMT), Pfizer (PFE), Verizon (VZ), and McDonald's (MCD). All yield more than the 10-year Treasury and likely have more adaptive managements than that in D.C. What's not to like?

[OLDFLM]

Originally Posted by GregWeld

So here's a couple thoughts -- and remember that I'm really "exposing myself" personally here - but I can only use information and share that - from what I really KNOW... not what I heard from someone else tell someone else.


I was "reviewing" someones portfolio... at their request. Just a look and compare function.

They were in SONY (SNE).... Okay - great name right?! But the OWNER of the account only knew they were in Sony and that sounded great!

A quick check of the charts -- SNE is DOWN 64% over 10 years and DOWN 50+% over the last 5 years!

Compared to an investment in McDonalds (just to pick a favorite) that is UP 267%

So 100K invested in SONY is now worth 40K and the same 100K invested in McDonalds (at the same time - 10 years ago) is now worth almost 400K. (I'm not doing any math here - I'm just making quick comparisons).

Here's THE POINT.... his money is professionally managed -- so he never did ANY research for himself - nor did he even know WHY he was invested in what he was invested in! That my friends is total BS!! You going to buy a motor and not ask what's in it and how it was built and what kind of power it's making? One 454 could produce 300HP built for a truck - and another could be making 700HP... HUGE difference. Treat your investments the same way! Do just the minimum amount of research. You can check all this in Google Finance or Yahoo Finance - it's so dang easy just to look! It will pay off in the long run.

Talk about the perfect analogy for your intended audience!