Investing 102

[bdahlg68]

For any Fidelity 401k people that want to avoid mutual funds, see if you are able to sign up for Brokeragelink and put your investments into that. Brokeragelink allows you to invest in the market like any other account and not be stuck with the mutual funds allowed by your plan.

[GregWeld]

Originally Posted by LS1-IROC

Thanks to Greg and some of the other knowledgeable guys, I'm meeting with Chuck tomorrow to get into the game!

Time to get these slacker employees I have in savings to back to work

I hope RAY chimes in here --- I'd love to know what Mutual Fund he was in just so I could check it out - and that he doesn't take my "slacker" comment as a personal attack -- it was meant to be funny - like guys hanging out in the shop... busting each others chops.

I really do think of my money as one dollar is one employee... My job is to manage my employees. They don't need to be super stars - they just need to be always doing the best job for me that they can. And I have different "divisions" for them to work in. The "accountants" are boring steady eddy guys - Then there's the sales team (higher risk) - etc. Some times I have to just flat fire some of them.... and some times some of them need "re-training" (rebalancing)...

[GregWeld]

Along the lines that Solar was mentioning -- since it's the first of the month -- I wake up to some TAX FREE MUNI payments... So let me explain a little bit about this --- Tax free bonds pay all 'over the place' -- so when you have a bunch of them you're always getting "something" generally around the 1st or the 15th of the month. There are TWO periods in the year when I get really really nice payments --- June and December... the rest of the time it amounts to a few thousand per month.. but June and December is a happy place.

Dividends will pay like this as well.... you go along and nothing - more nothing and then BAM! In they come. The more stocks you own - the more spread out they become. Different "quarters" - different pay dates - different "EX" dates. But once the STREAM starts (takes at least 6 months) then it seems you're getting something all the time.

I've got a sizable amount of shares (25,000) in Annaly Capital Management (NLY) and January 26th I got a dividend of $14,250. I mention this because this is what you're after.... Think about that -- I get that 4 times a year. I don't care who you are - that's like free money!

Here's the INTEREST (TAX FREE) I got just today (being the 1st).

02/01/12

Cash
DIVIDEND RECEIVED
AMEREN ILL CO PFD 4.92% AILLM


$738.00 USD


02/01/12

Cash
MUNI EXEMPT INT
WALLA WALLA WASH WTR & WASTEWTR REV REF 03.87500% 08/01/2017 BDS SER. 2005 932238BY3


$968.75 USD


02/01/12

Cash
DIVIDEND RECEIVED
WASHINGTON GAS LT CO PFD $4.80 WGLCO


$690.00 USD


02/01/12

Cash
DIVIDEND RECEIVED
WISCONSIN PUB SVC CP PFD 5% WIPSO


$693.75 USD

[GregWeld]

So to continue on that line of thinking -- and remember -- I'm sharing personal information here because I want those of you that haven't gotten a taste for what savings can do for you -- I want you to SEE... this is REAL... and that you too can do this!

Here's a ETF (exchange traded fund - so similar to a mutual fund) that holds high yielding CORPORATE bonds. This pays MONTHLY... and I use it to "park" cash - so it goes up and down - and obviously so do the dividends. But think abut this if you're retired and you're getting these dividends every month... so let's see if I can "copy and past" from Schwab...

Look at the dates and see that this bad boy (this is not recommending it for ANYONE - this is just ONE example) pays way better than a slot machine.

THIS IS THE POWER OF DIVIDENDS! That's what I'm trying to show you here.


01/04/2012 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: CASH DIV
$1,871.51

12/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$1,921.54

11/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$1,841.88

10/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$1,883.93

09/08/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$1,971.75

06/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$3,394.24

05/06/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$2,291.79

04/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$2,278.48

03/07/2011 HYG ISHARES TRUST IBOXX $ HIGH YIELD CORP
type: ORD DIV - CASH
$1,157.45

[Sieg]

Originally Posted by GregWeld

I've got a sizable amount of shares (25,000) in Annaly Capital Management (NLY) and January 26th I got a dividend of $14,250. I mention this because this is what you're after.... Think about that -- I get that 4 times a year. I don't care who you are - that's like free money!

I like that style of "high-risk" in my portfolio!

[lmnop]

Originally Posted by GregWeld

Ray -- # 1 congratulations on doing HALF your job... the savings early part! But you slacker -- you then promptly ignored MAKING YOUR MONEY WORK FOR YOU. No days off -- no sick pay... You need to pay a bit of attention to your money or they (I pretend every dollar is one employee!) walk off the job when you're not looking.

This is not to say you start to become a micro manager! It means that you need to pay attention and if you're guys are slacking - you need to do a bit of work yourself and see if you can't' get some of those guys "retrained" or "redeployed".

Go back and read from page one -- that's your homework assignment... and see if you can get reengaged and make that dream come back to life! It's not too late.

Your right I am a slacker and my employes are following my lead. I am going to take charge of those lazy b*******. I did the assigned homework. And I wish some had explained to me how crappy mutual funds are before I bought them. But better late than never. I am going to do some research and pick some stocks. I was thinking I would divided the 21k into 4 or 8 so either $5250 or $2625 per company. How would you divide the money? The dream is still alive.
Also I took the "slacker" comment as it was intended, I enjoy the casual feel to this thread I feel like I am hanging out with buddies in the shop.
Thanks Greg!

[Sieg]

Don't feel bad Ray, I'm negligent too and we're not alone. That's the beauty of this thread, it is motivating people to take action and make changes and there not in the brokers best interest.............there in ours!

[GregWeld]

Originally Posted by lmnop

Your right I am a slacker and my employes are following my lead. I am going to take charge of those lazy b*******. I did the assigned homework. And I wish some had explained to me how crappy mutual funds are before I bought them. But better late than never. I am going to do some research and pick some stocks. I was thinking I would divided the 21k into 4 or 8 so either $5250 or $2625 per company. How would you divide the money? The dream is still alive.
Also I took the "slacker" comment as it was intended, I enjoy the casual feel to this thread I feel like I am hanging out with buddies in the shop.
Thanks Greg!

Good to hear Ray!

Personally -- I'd divide the 21K into 8 to 10 different stocks... and if you want help picking -- then post what you're thinking up here and we'll roll 'em around. With this amount you can get some diversity with sectors and have just a bit of higher risk in order to boost your overall return... balancing out some of the safer lower dividend payers.... but with 20K invested - you should be able to MAKE over $1000 per year... and reinvested -- in 5 years you're going to have capital growth AND more shares paying more dividends and you'll be making the snowball into a snowman!

IF you want to, that is.

[GregWeld]

Originally Posted by Sieg

I like that style of "high-risk" in my portfolio!

Me too!

I use JNK and HYG and NLY as my 'balance' in one stock account to bring the overall dividend payout UP... from the lower payouts of the Coke and JNJ etc. BUT --- Don't mistake that for being greedy -- they are VERY SMALL percentages of my overall invested dollars --- and I have a quite healthy MUNI BOND portfolio that is "super safe"... But also major boring and notoriously low yield.

Remember -- MUNI BONDS like that are bought for blue haired old ladies (me) and have an income stream that is tax free -- but for that safety and yield -- you'll GET ZERO GROWTH in your capital! I can "trade them" -- every one of mine has a face value above where I bought them -- but then that's not why I bought them. I bought them to have a safe income stream that is tax free... so that's what I'll stick to.

[Blake Foster]

Just hired another bunch of Employees and have contracted to add the same number every month going forward. Bastards better work!!!

I just had a meeting with my guy , transfered all the wifes -2% return last year to my guy who gave me 20.7% last year. actually he said i had the 4th highest performing account at their firm last year obviously as a precentage not cold hard bucks. to bad there wasn't millions in the account. My compound anual return since 2001 has been 10.5% and the total return from 2001 has been 176%
so I don't think I will change much lol