Investing 102

[SSLance]

I noticed the same thing, this is what I'm really starting to like about dividend Growth investing...

Of the 4 I bought yesterday morning, 2 ended up for the day, the other 2 down a bit. Overall the account was up a half a point.

I'm shopping yet again this morning. It's real hard to not be tempted to get too greedy with oil stocks right now.

[GregWeld]

Originally Posted by SSLance

I noticed the same thing, this is what I'm really starting to like about dividend Growth investing...

Of the 4 I bought yesterday morning, 2 ended up for the day, the other 2 down a bit. Overall the account was up a half a point.

I'm shopping yet again this morning. It's real hard to not be tempted to get too greedy with oil stocks right now.

Well --- so here's something everyone needs to guard against -- and that's the opposite of FEAR -- it's GREED. We've had such fabulous market conditions for so long now - we've forgotten about real fear... and we just "ASSume" it's going straight back up. That can come back to bite people. We should never FEAR the market given what we should be invested in... but we should RESPECT the market. We don't control it - we're just along for the ride. There's so many old adages -- like Pigs get fat - hogs get slaughtered... etc. And these all ring true!! They're age old -- they're factual... and they're time tested.

So for those of you that are fearless --- remember these things. Scale in -- tip toe in -- don't go buying whole hog - and don't buy stuff you don't really understand -- "just because it's on sale". You'll end up with scratchy pants if you didn't know they were notoriously scratchy which is why the store put the on sale!! Yeah they looked great... yeah they're on sale half price. But buy ONE pair -- not a pair in every color! LOL



In the meantime -- I've made an absolute killing in the last two days. That doesn't mean I'll get to hold on to the gains... and I bought some stuff really well. But that's all that means -- is that I bought some stuff well. It could turn around in one day and I'd be bleeding in the streets. It's okay - I've been there many times. I'm still living to talk about it. :>)

[SSLance]

I spent some time yesterday just selectively adding to positions I already held. I'm still not quite half invested again in my IRA account and I added some of the same shares into my ROTH.

This time it was much easier for me to hit the submit button on the orders as I'm 8 months in and have history and a good feeling/history on the stocks I own. Like Greg says, I'm tip toeing in...and I'll probably at some point regret not buying more during the dip...but given where I was a year ago, I'm happy where I'm at.

[chichirone]

Anyone using OptionsHouse for their online account?

http://www.optionshouse.com/rates/

My wife ran across the site doing some stock research. Never heard of them but the prices look good. Just curious if anyone has any direct experience for how it compares to Schwab besides the rate differences they claim. Research tools? Reporting tools? Support? Etc...

[GregWeld]

Remember how skeptical you used to be??? After being burned in the market...


Isn't this different this time around? You're invested rather than just buying and hoping stuff goes up. That's a HUGE mental difference which WILL make a difference in your future. Being INVESTED and being comfortable being invested is what keeps you in the game.


Now -- A few posts back I told you guys about building 10,000 share investment in Energy Transfer Partners (ETP).... I was discussing the use of LIMIT ORDERS in order to insure I got a lower price during the day (you can set these for longer horizon if you choose that option). Well -- those shares are now UP 68 GRAND in just 3 or 4 days. MY POINT??? That's good money right? I would have blown those shares out so fast in the old days. I'd have scooped up the 68 Grand - had a 40% tax bill... and then been looking to put that back into something else. Sometimes that something else ate the rest of the gain the gubernut didn't take. THAT WAS STUPID.... Yes I made huge money on an annual basis "trading" -- but what I also did was paid monumental tax bills -- and my NET WORTH didn't go up. It was just trade trade trade.

Now -- I don't look at the paper gains... I look AHEAD at the dividend payments - what those are worth to me... and I pay a tiny fraction of the taxes I used to (my money is NOT in a IRA) --- and my net worth is growing. BIG CHANGE!!! HUGE!!! <Pretty Woman>

[SSLance]

Originally Posted by GregWeld

Remember how skeptical you used to be??? After being burned in the market...

Isn't this different this time around? You're invested rather than just buying and hoping stuff goes up. That's a HUGE mental difference which WILL make a difference in your future. Being INVESTED and being comfortable being invested is what keeps you in the game.

Or...just relying on a FA to make those decisions for me and then second guessing him or being pissed when I wasn't happy with the results or didn't understand the strategy.

Being invested myself lets me have a much clearer picture of what is really going on and actually takes less effort now and I understand the big picture better.

One can get bogged down in the details while trying to do too many things at once in the market. With just 10 equities to watch (I've actually got 11 now that I picked up some ETP) it's very simple and very rewarding.

[captainofiron]

Question.

My dad and I were talking about investments, he has been asking me lots of questions since he has seen me acting on what I have learned here. And yesterday he asked me to look at his 401k/IRA and asked what I would do.

Here are the specifics, he works for Halliburton (25+ years cant remember), he quit for a couple years to go with an independent oil co. they started to go south and Halliburton begged him to come back so before goign down with the ship my dad jumped back on board.

So he has his regular 401k, he has some restricted stocks with the company, and a bunch of unrestricted stocks and paid dividends just sitting in his account.

He is already retirement age, but wants to work till 2025.

My gut instinct (from what I have learned here) is to:
1)dump the unrestricted stock he has in halliburton
2)use it and the dividend cash he has sitting to buy some small stocks, and build a little mutual fund (it totals about 25k)

BUT is it "too late" as in he is too close to his retirement date? Should he just reinvest in the mutual fund his 401k is in?

I tried looking through the thread but couldnt find a similar situation

thanks gents

[ErikLS2]

I'm not sure if this will apply to your father but for the masses here there is a little known fact about 401k's when you leave your employer. If you have a 401k with a former employer (and it's typically a poor assortment of investment choices) you can transfer it to a traditional IRA account at a brokerage of your choosing, Schwab, Fidelity, etc. If you do a "trustee to trustee exchange" this is a tax free event for you. The money can't touch your hands or go through your bank account, if it does it's a taxable even to you. It must be transferred directly from the 401k administrator to the brokerage handling the traditional IRA account. This opens up the possibility of investing in anything you choose, through that Traditional IRA account. The key is you can no longer be employed with that company that the 401k is with (you can't do this while you still work for the company). I just did this and didn't even change employers. The company I work for was bought by another company so my job is still the same but I still was able to take advantage of this and moved all of my 401k over to my Schwab Traditional IRA which I can now invest the "Investing 102 way".

My guess is that this does not apply to your father since he is now back employed by the company tied to the 401k but he might want to check since I'm not sure. Schwab or any of the brokerage firms that do this can answer that question for him. I talk to a lot of people that still maintain past 401k's with previous employers and the poor investment choices that usually come with them when they could be taking advantage of this perfectly legitimate "trick" (if done correctly).

[captainofiron]

Originally Posted by ErikLS2

I'm not sure if this will apply to your father but for the masses here there is a little known fact about 401k's when you leave your employer. If you have a 401k with a former employer (and it's typically a poor assortment of investment choices) you can transfer it to a traditional IRA account at a brokerage of your choosing, Schwab, Fidelity, etc. If you do a "trustee to trustee exchange" this is a tax free event for you. The money can't touch your hands or go through your bank account, if it does it's a taxable even to you. It must be transferred directly from the 401k administrator to the brokerage handling the traditional IRA account. This opens up the possibility of investing in anything you choose, through that Traditional IRA account. The key is you can no longer be employed with that company that the 401k is with (you can't do this while you still work for the company). I just did this and didn't even change employers. The company I work for was bought by another company so my job is still the same but I still was able to take advantage of this and moved all of my 401k over to my Schwab Traditional IRA which I can now invest the "Investing 102 way".

My guess is that this does not apply to your father since he is now back employed by the company tied to the 401k but he might want to check since I'm not sure. Schwab or any of the brokerage firms that do this can answer that question for him. I talk to a lot of people that still maintain past 401k's with previous employers and the poor investment choices that usually come with them when they could be taking advantage of this perfectly legitimate "trick" (if done correctly).

I was looking through the options on his account (its through Fidelity) and on his 401k, its on a target date fund, and an assortment of target date funds and some bonds are the only options as far as the 401k

But I was talking more along the lines of the unrestricted stock he owns in Halliburton.

my only hesitation is because he is planning to retire in 2025, and I dont know if ~10 years is long enough to even out with stocks versus putting it back in his mutual fund

PLUS I know he will not actively look after it, which is why my thought turns to mutual funds even though I know they arent ideal

[WSSix]

I don't know about the rest of you but this whole market down turn on the waves of dropping oil prices and ebola fears sure as hell wasn't as bad as they made it out to be. While I'm still down overall on a number of my shares, the trend has definitely been up, sometimes just as quickly as it went down, to the point where I'm going to miss some deals waiting for money to get transferred etc.

Ignore the noise.