Investing 102

[slow4dr]

Originally Posted by Vegas69

Both I bought this year were in house deals. Number on was a listing of my brokers that never hit the market. This one was a referral from a past client of mine and I bought it. We put all the paperwork in my team agents name and processed his short sale. He's extremely happy and so am I.

I'd find a local agent that slings some business in a productive office and tell them to go shake some hands.

Damn, that pretty much sums up why I can't compete in today's market. When I bought in 2010 I had been shopping and making offers for 6-9 months. I was so fed up with the whole process that I almost got my license. In the process of making so many offers I probably used 15 different agents. I found a few that were very proactive that I really enjoyed working with and will use in the future.

Inventory levels are 25% of what they were in 2010 in my area so I don't even bother seriously looking right now.

[GregWeld]

Today is a perfect example of why I "scale" in or out of positions...


I had built quite a large position in the Junk Bond ETF (JNK)... some 60,000 shares. Remember that this, and a couple other names, are used to "park" cash until I want it for investing. This ETF pays a monthly cash flow of almost 13 grand on this amount of shares (.21 per share per month!)... so you understand why I don't just let this kind of cash sit in a Money Market account etc.

A couple weeks ago I decided I should cut this down and get busy buying some shares - so sold HALF the position. I never get "antsy" to just rush money around... so no need to sell ALL and then try to find suitable homes for it. These "employees" were very content and working hard in their current jobs there at JNK!!

So the reason for todays post.... JNK paid me a full dividend - because I always check to see what the EX dividend date is before I sell anything! No point in missing the EX date dividend (that would be just stupid)... and the full position had a paper gain of about 24K at the time of the sale. I sold half. With todays paper gain - the half that's left shows a 20K paper gain. BINGO! Gotta love that!

Remember -- we want TOTAL RETURN... that's the dividend stream AND the capital growth combined!

Obviously I'm well aware that most of you don't have these kinds of numbers to play with... However, the LESSON here is what needs to be focused on - it does translate regardless of the amounts involved. So REMEMBER to check the EX dividend date before a sale! And don't be afraid to take a profit! And don't sell everything all at once or buy everything all at once if you have "enough" position to be able to scale in and out (Unless the position has blown up and is heading down in a hurry - but that's a different discussion).

[GregWeld]

This article on Wal-Mart sums up why I don't investment in any business where the principal customer is "low end". They're (sadly) the most vulnerable to very small economic changes. A person making minimum wage -- is just barely scraping by --- hit this person with 40 or 50 bucks a month in decreased income (for whatever reason) and they're hosed!

NOW -- there's been no official announcement from Wal-Mart - but usually these types of "leaks" have some basis in truth.




http://www.telegraph.co.uk/finance/n...ed-emails.html

[realcoray]

Originally Posted by slow4dr

Damn, that pretty much sums up why I can't compete in today's market. When I bought in 2010 I had been shopping and making offers for 6-9 months. I was so fed up with the whole process that I almost got my license. In the process of making so many offers I probably used 15 different agents. I found a few that were very proactive that I really enjoyed working with and will use in the future.

Inventory levels are 25% of what they were in 2010 in my area so I don't even bother seriously looking right now.

It's definitely possible to find solid investments right now, it isn't like the pros just throw their hands up, they are out there grinding and finding deals.

If you're looking for investments, I would suggest NOT using an agent to find you properties because in my experience most agents are not aware of what constitutes a good investment. Even if they have their own, they are often holding onto money losers.

You don't have to have your license, you just need an agent who is fine with you being in charge, picking out things to look at and operating at your pace.

[Vegas69]

Originally Posted by realcoray

It's definitely possible to find solid investments right now, it isn't like the pros just throw their hands up, they are out there grinding and finding deals.

If you're looking for investments, I would suggest NOT using an agent to find you properties because in my experience most agents are not aware of what constitutes a good investment. Even if they have their own, they are often holding onto money losers.

You don't have to have your license, you just need an agent who is fine with you being in charge, picking out things to look at and operating at your pace.

This is why I work with very few investors. I'll take my clients that buy and sell and think they owe me dinner.

[Tony_SS]

Guys, what would you do with IRA CD that isn't making squat? It will mature in Nov this year. Idea's?

My knowledge is very limited on all of these investment products.

[GregWeld]

Originally Posted by Tony_SS

Guys, what would you do with IRA CD that isn't making squat? It will mature in Nov this year. Idea's?

My knowledge is very limited on all of these investment products.

This thread is full of "ideas" -- you just have to go back and read them to answer your own question.

[slow4dr]

Originally Posted by realcoray

It's definitely possible to find solid investments right now, it isn't like the pros just throw their hands up, they are out there grinding and finding deals.

If you're looking for investments, I would suggest NOT using an agent to find you properties because in my experience most agents are not aware of what constitutes a good investment. Even if they have their own, they are often holding onto money losers.

You don't have to have your license, you just need an agent who is fine with you being in charge, picking out things to look at and operating at your pace.

I am not arguing that there are plenty of solid investments out there. The problem is getting an offer accepted. I was very proactive in 2010 trying to find something, even offering 5%-10% over in some cases and ended up closing two days after Christmas. I fought tooth and nail for months and never gave up. It was an extremely stressful process and my wife was pregnant at the time so it is not a happy memory. The thought of going through that now with an 18 month old and a 5 year old just doesn't sit well with me. Especially given the fact that inventory levels are even lower now.

Every single house I looked at (which was hovering around 100 in a 9 month period) was researched and found by yours truly through Redfin. Never once did any of the agents call me about a house that fit my criteria, I was always one step ahead of them, which is truly sad.

[Jack Maurer]

Originally Posted by Tony_SS

Guys, what would you do with IRA CD that isn't making squat? It will mature in Nov this year. Idea's?

My knowledge is very limited on all of these investment products.

CD, you mean certificate of depreciation. I would look at some of the annuity products on the market. You might want to visit my web site at www.capitaladvisor.info

[Tony_SS]

Originally Posted by Jack Maurer

CD, you mean certificate of depreciation. I would look at some of the annuity products on the market. You might want to visit my web site at www.capitaladvisor.info

LOL yes, that's it. Thanks, I'll take a look.