Search found 516 matches

by SpaceCommander
Sat Feb 09, 2019 12:36 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure [risk parity strategy using 3x leveraged ETFs]
Replies: 3353
Views: 883729

Re: HEDGEFUNDIE's excellent adventure [risk parity strategy using 3x leveraged ETFs]

It's easy to be a critic when someone tries something innovative.

If it works, the reply is either: 1. He took too much risk, or 2. He got lucky.
If it fails, the reply is: See. We told you so.

Either way, the critic is justified and the innovator can't win. :oops:
by SpaceCommander
Wed Jan 30, 2019 5:32 am
Forum: Personal Investments
Topic: Finally thinking about making the switch from Vanguard to Fidelity
Replies: 50
Views: 9448

Re: Finally thinking about making the switch from Vanguard to Fidelity

Funny you should mention it: I have an appointment today at my local Fidelity office. After 20 years at Vanguard, I'm moving everything to Fidelity. A couple of reasons: 1. Vanguard is no longer the low cost leader. 2. Customer service has been disappointing in recent years 3. The straw that broke this camel's back was a new policy in their brokerage that customers cannot purchase leveraged or bear etfs. This is a self directed brokerage account, but this nanny firm won't give us access to certain products. I think Vanguard wants to protect its customers from themselves. Thank you very much, but I can do without the hand holding. I usually don't use these products, but if I want to hedge a long position in my taxable account with a bear fun...
by SpaceCommander
Thu Nov 15, 2018 8:37 pm
Forum: Personal Investments
Topic: Muscular Portfolios Questions
Replies: 20
Views: 6395

Re: Muscular Portfolios Questions

So I read the book. Basically it's tactical asset allocation based on relative strength. Hold top three out of thirteen etfs. Rebalance monthly. This kind of approach has been discussed on this forum before. If it's such a simple method, then why 400+ pages? There's actually a lot more to the book than the etf rotation strategy. Of interest to Bogleheads might be the sharp critique of many popular "lazy portfolios". There's a lot of data provided that purports to debunk a long term buy-n-hold asset allocation approach. This forum is actually mentioned on pages 64 and 88. There's a lot of discussion of Jack Bogle and index investing. Even if one were not interested in the rotation strategy, there's a lot of good information here. F...
by SpaceCommander
Sun Oct 21, 2018 6:39 pm
Forum: Personal Finance (Not Investing)
Topic: Put more than 20% down on a house?
Replies: 33
Views: 4465

Re: Put more than 20% down on a house?

Personally, I'm a big fan of the 100% down plan. If you have the means, I highly recommended it.
by SpaceCommander
Wed Jul 04, 2018 9:03 pm
Forum: Personal Consumer Issues
Topic: Keto Diet
Replies: 16
Views: 2628

Re: Keto Diet

UniversityEmployee9 wrote: Wed Jul 04, 2018 9:00 pm I've been on the keto diet for a month and I've lost ten pounds and feel great.

The people who say keto is "dangerous" have usually confused the ketogenic diet with ketoacidosis, which can only occur if your blood ketone levels go above 7mmol/l while having very high blood sugar (i.e., you would need to be diabetic). On a ketogenic diet your blood sugar hovers around 83mg/dl, which is considered ideal, and a safe ketone range of between 1 and 3 mmol/l.
Please read the research. NutritionFacts.org. Physicians Committee for Responsible Medicine, pcrm.org
by SpaceCommander
Wed Jul 04, 2018 8:52 pm
Forum: Personal Consumer Issues
Topic: Keto Diet
Replies: 16
Views: 2628

Re: Keto Diet

I would recommend checking out Nutritionfacts.org for guidance on the latest diet trends. There's a good deal of unbiased info there on keto. Search "low carb". Also check out the physician's committee for responsible medicine, pcrm.org. Search "low carb". Peer reviewed scientific studies not funded by the ag industry might give you pause on keto. FWIW,
by SpaceCommander
Mon May 08, 2017 4:52 pm
Forum: Personal Investments
Topic: Does Magic Formula works or ever worked for you?
Replies: 39
Views: 17752

Re: Does Magic Formula works or ever worked for you?

Marsh Gerda has been applying the Magic Formula in real time and posting his results in public for years. His MFI Select portfolios have shown strong outperformance. His strict Magic Formula "buy 50 and hold for a year" portfolios have consistently trailed. http://justadrone.blogspot.com/ Which Magic Formula is the real Magic Formula? Gerda's results speak for themselves. If you bother to check out his site, you can see his real time returns. If one was inclined to stockpick, you could do much worse. FWIW, It's a serious question that deserves a real answer. You say that there are two Magic Formulas, and that in a real-world test by a serious investor one of them outperformed and one of them underperformed. So if I am interested ...
by SpaceCommander
Sun May 07, 2017 4:17 pm
Forum: Personal Investments
Topic: Does Magic Formula works or ever worked for you?
Replies: 39
Views: 17752

Re: Does Magic Formula works or ever worked for you?

nisiprius wrote:
SpaceCommander wrote:Marsh Gerda has been applying the Magic Formula in real time and posting his results in public for years. His MFI Select portfolios have shown strong outperformance. His strict Magic Formula "buy 50 and hold for a year" portfolios have consistently trailed.

http://justadrone.blogspot.com/
Which Magic Formula is the real Magic Formula?
Gerda's results speak for themselves. If you bother to check out his site, you can see his real time returns. If one was inclined to stockpick, you could do much worse. FWIW,
by SpaceCommander
Sun May 07, 2017 7:37 am
Forum: Personal Investments
Topic: Does Magic Formula works or ever worked for you?
Replies: 39
Views: 17752

Re: Does Magic Formula works or ever worked for you?

Marsh Gerda has been applying the Magic Formula in real time and posting his results in public for years. His MFI Select portfolios have shown strong outperformance. His strict Magic Formula "buy 50 and hold for a year" portfolios have consistently trailed.

http://justadrone.blogspot.com/
by SpaceCommander
Tue Aug 23, 2016 7:44 am
Forum: Personal Finance (Not Investing)
Topic: What's worth more?
Replies: 28
Views: 4218

Re: What's worth more?

JoMoney wrote:In this hypothetical, how old am I, and how soon can I start withdrawing the Federal pension?
To keep it apples to apples, say you're beginning retirement and can start drawing the pension immediately.
by SpaceCommander
Mon Aug 22, 2016 10:43 pm
Forum: Personal Finance (Not Investing)
Topic: What's worth more?
Replies: 28
Views: 4218

Re: What's worth more?

Just interested in the prevailing opinion among the Personal Finance wizards on this board: What's more valuable? 1. $1,000,000.00 in a retirement account? or 2. A joint life 2-person inflation-adjusted Federal pension paying $40,000.00/year Which would you prefer? SpaceCommander: You can get a quick answer by using the Annuity Calculator at http://www.immediateannuities.com. Put $1,000,000 annuity premium in the Calculator. If the annuity pays more than $40,000/year, I would normally prefer the Federal pension. Best wishes. Taylor Thanks. I'm familiar with the site. That's a sound mathematical answer. However, there is a behavioral/emotional piece to investing. I suspect that many would prefer the peace-of-mind of guaranteed income over a...
by SpaceCommander
Mon Aug 22, 2016 9:58 pm
Forum: Personal Finance (Not Investing)
Topic: What's worth more?
Replies: 28
Views: 4218

What's worth more?

Just interested in the prevailing opinion among the Personal Finance wizards on this board:

What's more valuable?

1. $1,000,000.00 in a retirement account?

or

2. A joint life 2-person inflation-adjusted Federal pension paying $40,000.00/year

Which would you prefer?
by SpaceCommander
Sun Jul 03, 2016 5:32 pm
Forum: Personal Investments
Topic: Living off dividends/interest in retiremeht
Replies: 60
Views: 12385

Re: Living off dividends/interest in retiremeht

A wise man once said, "In theory there's no difference between theory and practice, but in practice there is." IMHO, what many are missing here is the most important aspect of investing: the behavioral piece. What's it worth to know that know matter what, come hell or high water, you never have to sell shares in a down market to cover your monthly withdrawals for income? How valuable is that? Also, what if you didn't have to control risk by loading up on bonds in retirement (like most advocate here, despite negative expected real returns). What if you could remain fully invested (even 100% stocks if you like). Knowing that your monthly withdrawals are covered 100% by your dividend income? Would your bottom line be higher in the lo...
by SpaceCommander
Fri Mar 18, 2016 9:36 pm
Forum: Personal Investments
Topic: Living off dividend income
Replies: 44
Views: 17516

Re: Living off dividend income

I'm not sure this is the best forum to discuss income investing. I think Bogleheads often have one tool in their toolbox. It's a hammer. It doesn't matter what the individual circumstances are: the solution is to use the hammer. When used appropriately a hammer is an excellent tool. But sometimes the situation might call for something else. That's where you might look elsewhere for an alternative point of view. Just a few examples off the top of my head: With a million bucks I can buy a nice apartment building for cash in my town and live quite well on the income indefinitely. That could be an excellent option for the right person. For someone else, an annuity and reverse mortgage could do the trick. Someone else might prefer a portfolio of...
by SpaceCommander
Mon Jan 04, 2016 8:22 pm
Forum: Personal Finance (Not Investing)
Topic: Job Prospects for English Majors?
Replies: 73
Views: 12507

Re: Job Prospects for English Majors?

She might qualify for an officer's commission in the military. If she's even remotely interested, she can take a military science course or two as an elective and see if she wants to apply for Officer Candidate School upon graduation. With any luck, an English major could even become a real Major! :D
by SpaceCommander
Wed Nov 11, 2015 8:11 am
Forum: Personal Consumer Issues
Topic: Cord cutters: Sling TV vs USTV
Replies: 7
Views: 2180

Re: Cord cutters: Sling TV vs USTV

We have Sling with a 100/100 internet connection and we have a running joke about not switching to it until 15 minutes before the show we want to watch starts. Reason 1 - it sometimes takes 10 or so minutes from start to finish to actually get it up and running on the correct channel. For ex., switching from ESPN to AMC can take several minutes. Reason 2 - Sling tends to freeze up for several minutes after an hour or so of viewing so we don't want to turn it on too soon before what we want to watch comes on - it typically freezes during the climax of whatever we're viewing. It's hilarious in its own way.... but you can set your watch by it. I'm not sure what causes these 2 behaviors. We're bringing it in via a Roku 3 on a modern TV. If you...
by SpaceCommander
Wed Oct 14, 2015 3:33 pm
Forum: Investing - Theory, News & General
Topic: We miss Larry Swedroe
Replies: 38
Views: 13362

Re: We miss Larry Swedroe

I'll be the outlier here: Larry is a big part of the reason I don't visit this board so much anymore. Frankly, his style isn't endearing to some. FWIW.
by SpaceCommander
Fri Oct 09, 2015 8:03 pm
Forum: Personal Investments
Topic: Warren Buffett 90/10 Portfolio
Replies: 69
Views: 16985

Re: Warren Buffett 90/10 Portfolio

I would add that Buffett recommends index funds for "those who don't know what they're doing." The reason he thinks most people should index is because most people (99%) don't know what they're doing. This is the same guy who has said that someone who does indeed know what he/she is doing could be adequately diversified by holding as few as six individual stocks (that's the whole portfolio folks!) Clearly he's in another league and plays by different rules than Bogleheads. He is on record scoffing at extensive diversification and has vowed that Berkshire would never invest in a fund (index or otherwise). I think most Bogleheads are better off listening to Bogle and leave Buffett's wisdom to the stockpickers.
by SpaceCommander
Wed Aug 05, 2015 9:48 pm
Forum: Investing - Theory, News & General
Topic: The folly of the dividend yield
Replies: 73
Views: 8697

Re: The folly of the dividend yield

I agree with someone above who laments the "anti-dividend" rhetoric is wearisome. I don't hear Bogle trashing dividends. Somehow the "Boglehead" board morphed into the "Swedroe et. al." board at some point. I think that's why I don't visit here as often as I used to. Reasoning with those types is like playing chess with a pigeon. Especially when they beat up their strawman and then claim victory. It's clear these types have never bothered to read Graham on the value of dividends. I recommend the big one (Security Analysis) for those willing to put in the work. For the others who just want to read that which reinforces what they already believe, I say, knock yourself out. Apologies for the 10 second rant. Carry ...
by SpaceCommander
Mon Jun 15, 2015 6:38 am
Forum: Personal Investments
Topic: Clean investing in a single stock
Replies: 66
Views: 12130

Re: Clean investing in a single stock

This kind of foolhardy speculation is like running through a dynamite factory with a burning match; you might live, but you're still an idiot. (memorable quip by Joel Greenblatt). :mrgreen:
by SpaceCommander
Mon Jun 08, 2015 10:06 am
Forum: Personal Investments
Topic: Do dividends keep up with inflation?
Replies: 6
Views: 1959

Re: Do dividends keep up with inflation?

I think the income from a basket of dividend aristocrats will handily outpace inflation over time. Another question is whether or not this is a suitable strategy for maximum total returns over time. But if your concern is simply for inflation adjusted income, then yes; a basket of aristocrats will throw off an income stream that is more than adequate.
by SpaceCommander
Sun Apr 19, 2015 4:20 am
Forum: Personal Investments
Topic: Two Comma Club
Replies: 94
Views: 22128

Re: Two Comma Club

A memorable milestone. Congrats.

When I crossed the 2 comma threshold, I was the middle east sitting in the desert with the Marines. I was in a place where I could get a wifi connection, so I checked my accounts to find that I was finally in 7 figures. I had to tell someone, so I told a buddy nearby and he said, "That's great man! Tonight the beers are on you!" Except there were no beers to be had because we were deployed! The beers had to wait. :beer
by SpaceCommander
Wed Feb 25, 2015 2:01 am
Forum: Investing - Theory, News & General
Topic: Buy and Hold Forever Stocks
Replies: 104
Views: 17947

Re: Buy and Hold Forever Stocks

Over its three-year lifespan (so far), Morningstar's MOAT etf has fallen short of the index (VTI). I wouldn't be surprised to see MOAT outperform in bear markets but I suspect that the wide-moat argument is well-enough known that it has already been priced in. OTOH, AAPL is certainly a wide-moat stock from my perspective (I'm not sure how Morningstar classifies it). I think AAPL keeps getting under-appreciated because no company in history has ever done as well as it has been doing and it's natural to want to believe that they can't keep it up: AAPL's market cap now exceeds that of the entire S&P 600 (small cap) and is twice that of the second biggest company (XOM). I think I read that they earned more last quarter than 450 of the S&am...
by SpaceCommander
Wed Feb 25, 2015 1:43 am
Forum: Investing - Theory, News & General
Topic: 10 Interesting facts about the S&P500
Replies: 28
Views: 5357

Re: 10 Interesting facts about the S&P500

I don't know much about the S&P500 other than it's cap weighted meaning that it's overweight the most expensive stocks and underweight the cheapest ones. :) I don't think cap weighted means what you think it means. If you're going to say that it's "overweight" or "underweight" at least explain what the baseline is that you're comparing it to. I think we both know exactly what I meant there. Judging from your many insightful posts here, you seem to be a well informed chap. Cap weighted indexes systematically overweight the most expensive stocks and underweight the cheapest. That's how they're designed. Some would say that's a fatal flaw. However, the advantage with them is that trading costs are virtually nil. So dif...
by SpaceCommander
Tue Feb 24, 2015 5:27 am
Forum: Investing - Theory, News & General
Topic: Value investing doesn't even beat the S&P 500
Replies: 56
Views: 10400

Re: Value investing doesn't even beat the S&P 500

It seems to me that the OP simply noted that people who invest in value mutual funds underperform the S&P500. Frankly, that's not all that surprising. Investors in growth mutual funds underperform too. The issue is not value vs. growth, it's mutual funds vs. the index. I thought Bogle made it clear that the index almost invariably wins over time.
by SpaceCommander
Tue Feb 24, 2015 5:16 am
Forum: Investing - Theory, News & General
Topic: Buy and Hold Forever Stocks
Replies: 104
Views: 17947

Re: Buy and Hold Forever Stocks

In reply to the OP: a "hold forever" stock is tough to identify because things change. However, a "wide moat" stock is one that can be reasonably expected to earn returns in excess of its cost of capital for the next 20 years. That's "forever" enough for me. Fortunately, Morningstar makes it easy to identify such stocks by labeling "wide moat" stocks according to their analysis. So there's your pool of candidates. Now you don't buy without regard to valuation, that would be foolish. I would suggest identifying those wide moat names that are beaten down in price and look to pick them up cheap. Given that approach, Exxon would look to be an ideal candidate right now (contra the advice of another contrib...
by SpaceCommander
Tue Feb 24, 2015 5:02 am
Forum: Investing - Theory, News & General
Topic: 10 Interesting facts about the S&P500
Replies: 28
Views: 5357

Re: 10 Interesting facts about the S&P500

I don't know much about the S&P500 other than it's cap weighted meaning that it's overweight the most expensive stocks and underweight the cheapest ones. :)
by SpaceCommander
Tue Dec 09, 2014 8:55 pm
Forum: Personal Investments
Topic: Is There An Actively Managed Fund Cheaper Than An Index Fund
Replies: 25
Views: 3439

Re: Is There An Actively Managed Fund Cheaper Than An Index

Berkshire Hathaway is not a mutual fund of any sort. +1 Paul If you think Berkshire doesn't compare to a mutual fund, in my opinion, you are sadly mistaken. Here's a list of companies that make up Berkshire: Acme Brick Company Applied Underwriters Ben Bridge Jeweler Benjamin Moore Co Berkshire Hathaway Energy Company Berkshire Hathaway Homestate Companies Berkshire Hathaway Specialty Insurance BH Media Group Boat U.S. Borsheims Fine Jewelry Brooks Buffalo News, Buffalo NY BNSF Business Wire Central States Indemnity Company Clayton Homes CORT Business Services CTB Inc. Fechheimer Brothers Company FlightSafety Forest River Fruit of the Loom Companies Garan Inc. Gateway Underwriters Agency GEICO Auto Insurance General Re Guard Insurance Group...
by SpaceCommander
Tue Dec 09, 2014 11:08 am
Forum: Personal Investments
Topic: Is There An Actively Managed Fund Cheaper Than An Index Fund
Replies: 25
Views: 3439

Re: Is There An Actively Managed Fund Cheaper Than An Index

Berkshire Hathaway is essentially a fund. It has an expense ratio of zero. (And a pretty good fund manager too, I hear).

Index funds cannot beat zero. BRK.B

:happy
by SpaceCommander
Sun Dec 07, 2014 9:06 am
Forum: Investing - Theory, News & General
Topic: Investing Magazines
Replies: 36
Views: 5674

Re: Investing Magazines

If you want specific investment advice, a magazine probably isn't what you're looking for. Perhaps a newsletter will fit the bill, but outsized returns by following advice from investment newsletters probably isn't going to happen.

On the other hand, personal finance magazines often have useful information on credit, insurance, debt, taxes, etc. In that vein, Money Magazine and Kiplingers are often helpful.
by SpaceCommander
Fri Dec 05, 2014 10:28 am
Forum: Personal Finance (Not Investing)
Topic: Why is Dave Ramsey wrong?
Replies: 180
Views: 52279

Re: Why is Dave Ramsey wrong?

I'm going to go out on a limb here and say I'm not completely opposed to a financial advisor receiving a commission. I don't think they're all ripoff artists. Certainly for someone willing to learn about finances and how to manage their own investments, financial salespeople are completely unnecessary. Hence, the vast majority reading this Boglehead board would merely be flushing their dollars away by going that route. But I think Ramsey is targeting the average guy on the street who has absolutely no interest in managing money or learning about finance. For those people, Ramsey steers them to commissioned sales. Frankly, I think that's reasonable. The salespeople deserve compensation for their time, trouble, and hand-holding. And the typic...
by SpaceCommander
Mon Dec 01, 2014 6:16 pm
Forum: Personal Finance (Not Investing)
Topic: Tools for indexers
Replies: 1
Views: 850

Re: Tools for indexers

I like Eric Haas' list of best funds/etfs for each asset class. Bookmarked here: http://altruistfa.com/dfavanguard.htm
by SpaceCommander
Mon Dec 01, 2014 7:27 am
Forum: Investing - Theory, News & General
Topic: A rational allocation in individual stocks?
Replies: 20
Views: 2008

Re: A rational allocation in individual stocks?

...For what it's worth: everything bpp says here flies in the face of value investing principles.... Well, this is not a "value investing" forum. Reread the Bogleheads' investment philosophy and refresh your memory on what it has to say about value investing. Hint: it says nothing about value investing. There's no point in following Graham & Dodd unless you are willing to follow Benjamin Graham. If you are willing to follow what Benjamin Graham said in 1934 then you should give very serious consideration to what he said in 1976: In selecting the common stock portfolio, do you advise careful study of and selectivity among different issues? In general, no. I am no longer an advocate of elaborate techniques of security analysis ...
by SpaceCommander
Sun Nov 30, 2014 8:18 pm
Forum: Investing - Theory, News & General
Topic: Can active funds reliably beat the index? Actually, Yes.
Replies: 41
Views: 9694

Re: Can active funds reliably beat the index? Actually, Yes

If I were managing a mutual fund, I wouldn't want to own shares of my own fund. Here's the reason: the mutual fund is a deeply flawed medium. If I were a fund manager, I'd rather manage my own money privately, than pool it with 1000's of other retail investors. With my own small portfolio, I could invest fully in my best ideas. Once pooled with many millions of other dollars, I'd have to diversify away from my best choices. When the markets dip, the average Joe panics and sells, forcing me to liquidate shares in a downturn to meet redemptions. In a private portfolio, I wouldn't have to worry about massive redemptions when I underperform in a quarter; I wouldn't have a cash drag; my pay wouldn't be tied to the amount of assets under manageme...
by SpaceCommander
Sun Nov 30, 2014 7:31 pm
Forum: Investing - Theory, News & General
Topic: A rational allocation in individual stocks?
Replies: 20
Views: 2008

Re: A rational allocation in individual stocks?

You need an absolute minimum of five stocks diversified across five industries but the optimal size of an individual stock portfolio is 15-25 names. 30 at the very most. I will disagree here, and say the optimal size is as many names as possible. 30 at the very least. More is better. The reason being is that you only have so much time to follow your companies and you don't want to break the back of your letter carrier delivering all those annual reports and proxy statements. There is no need to follow one's companies. Annual reports and proxy statements can go straight into the trash unread. Also the more stocks you own, the more likely your portfolio will mostly mirror the index Which is good! but with more volatility. And better tax-mana...
by SpaceCommander
Sat Nov 29, 2014 4:29 pm
Forum: Investing - Theory, News & General
Topic: I'm getting Slaughtered in stocks
Replies: 43
Views: 7977

Re: I'm getting Slaughtered in stocks

I too would be interested in learning which companies made up the investment. Even more specifically: why were they chosen? And what kind of due diligence was performed on them? What money management rules were in place? Did he have an exit strategy beforehand, or was this merely a "buy & hope" approach to stock market speculation? My hunch is that the OP knows little about security analysis and was grossly underdiversified and flying by the seat of his pants. In his own words, he describes this adventure as "fooling around" with stocks. He also includes option trading in the mix but says little about that speculation. He says his motivation was "excitement" and "making some quick kills". This is ...
by SpaceCommander
Sat Nov 29, 2014 4:10 pm
Forum: Investing - Theory, News & General
Topic: Oil / Energy ETFs
Replies: 58
Views: 7598

Re: Oil / Energy ETFs

Very rarely are we able to pick up big oil at this kind of valuation. As the sector has taken its hits recently, I'm happy to add some leading majors to my income porfolios at this time. As a matter of fact, I'm selling some overvalued utilities on Monday and rolling those proceeds into some undervalued oil stocks. In the long run, I think investors in big oil will do just fine getting in at these valuations. Is it the bottom? Nobody knows and only a fool would try to time it, but based on the numbers, I'm delighted to add to CVX at this level.

JC
by SpaceCommander
Fri Nov 21, 2014 4:18 pm
Forum: Investing - Theory, News & General
Topic: Apple Stock - Seems great, right?
Replies: 116
Views: 15965

Re: Apple Stock - Seems great, right?

Clearly_Irrational wrote:Completely insufficient amount of information necessary to make such a decision.
Of course. Apparently you missed the point: It is possible to select individual stocks with better fundamentals and valuation than the broad market. I'm not saying everyone should do so. I'm simply pointing out that it is something fairly easy to do.
by SpaceCommander
Thu Nov 20, 2014 6:42 pm
Forum: Investing - Theory, News & General
Topic: Apple Stock - Seems great, right?
Replies: 116
Views: 15965

Re: Apple Stock - Seems great, right?

Just for fun, I sketched out a potential investment on the back of a napkin. It came down to these two options:

Company A
ROE: 21.22
ROA: 8.19
Price to Forward Earnings: 17.6

Company B
ROE: 32.60
ROA: 18:08
Price to Foward Earnings: 14.8

Which would you rather own?

By the way: Company A is SPY, Company B is AAPL. :D
by SpaceCommander
Fri Nov 07, 2014 10:44 am
Forum: Investing - Theory, News & General
Topic: What individual stock?
Replies: 20
Views: 2242

Re: What individual stock?

Right now you can buy IBM at a lower cost than Buffet paid when he took a large position not too long ago. I like those odds.
by SpaceCommander
Thu Nov 06, 2014 2:18 pm
Forum: Personal Investments
Topic: Good book for 13 year old?
Replies: 14
Views: 2649

Re: Good book for 13 year old?

Before teaching him about investing, I'd start with personal finance in general and specifically focus on debt free living. My vote is for something like Financial Peace Jr. by Dave Ramsey.

http://www.amazon.com/Financial-Peace-J ... JPSTSZR5SE
by SpaceCommander
Mon Nov 03, 2014 5:16 pm
Forum: Investing - Theory, News & General
Topic: New Tony Robbins Book on Financial Freedom
Replies: 92
Views: 34905

Re: New Tony Robbins Book on Financial Freedom

pjstack wrote:I thought Tony Robbins was/is in prison.
You're probably thinking of another famous self-help guru: James Arthur Ray. He was sentenced to prison after people died in his sweatlodge fiasco a few years back. That wasn't Tony Robbins.

http://usatoday30.usatoday.com/news/nat ... 51298530/1
by SpaceCommander
Sat Nov 01, 2014 7:34 pm
Forum: Investing - Theory, News & General
Topic: "Should You Be a Dividend Stock Investor?"
Replies: 33
Views: 4842

Re: "Should You Be a Dividend Stock Investor?"

Ma Bell doesn't care so you shouldn't either. Good illustration of a behavioral finance "error" that lots and lots of people make. The behavioral aspect is indeed front and center here. When the investor's financial needs are covered by the portfolio's income, selling is unnecessary. When the bear comes, she can roll back over and go to sleep. However, the "total return" investor may very well find herself sweating it out knowing that she'll soon be selling into the downturn. Also, the income investor can snooze through with a much higher allocation to equities, whereas the "total return" investor tries to control risk by loading up on bonds that are likely to result in a negative real return. Who is likely to...
by SpaceCommander
Sun Oct 26, 2014 7:39 pm
Forum: Investing - Theory, News & General
Topic: Do stocks have an intrinsic fundamental value?
Replies: 31
Views: 3858

Re: Do stocks have an intrinsic fundamental value?

So what I hear Larry saying is, "Yes, stocks have intrinsic fundamental value, but you can't know what it is." While valuation estimates are just that: estimates, Buffet seems to think that under certain circumstances some valuation estimates are more reliable than others. If there's too much ambiguity, it goes into Buffet's "Too Hard" pile, and he takes a pass. However, sometimes it becomes clear that Mr. Market is overly pessimistic on a stock with sound fundamentals. In those cases, value investors are interested. Not all value investors are equally aggressive. Some want to hold out for Graham's fabled "net nets". Others are content to pick up bargains when they present a much smaller "margin of safety...
by SpaceCommander
Sun Oct 26, 2014 5:44 pm
Forum: Investing - Theory, News & General
Topic: Do stocks have an intrinsic fundamental value?
Replies: 31
Views: 3858

Re: Do stocks have an intrinsic fundamental value?

So what I hear Larry saying is, "Yes, stocks have intrinsic fundamental value, but you can't know what it is." While valuation estimates are just that: estimates, Buffet seems to think that under certain circumstances some valuation estimates are more reliable than others. If there's too much ambiguity, it goes into Buffet's "Too Hard" pile, and he takes a pass. However, sometimes it becomes clear that Mr. Market is overly pessimistic on a stock with sound fundamentals. In those cases, value investors are interested. Not all value investors are equally aggressive. Some want to hold out for Graham's fabled "net nets". Others are content to pick up bargains when they present a much smaller "margin of safety&...
by SpaceCommander
Thu Oct 23, 2014 7:20 pm
Forum: Investing - Theory, News & General
Topic: IBM: Stock Buybacks Gone Wrong?
Replies: 66
Views: 8015

Re: IBM: Stock Buybacks Gone Wrong?

Since we've been talking Buffet: here's how he would assess the propriety of stock buybacks.

"We test the wisdom of retaining earnings by assessing whether retention, over time, delivers shareholders at least $1 of market value for each $1 retained... The five year test should be: (1) during the period did our book-value gain exceed the performance of the S&P; and (2) did our stock consistently sell at a premium to book, meaning that every $1 of retained earnings was always worth more than $1? If these tests are met, retaining earnings has made sense." (Essays of Warren Buffet, 33)

Of course this refers to buybacks as well as reinvestment in the business. Makes sense to me. :idea:
by SpaceCommander
Thu Oct 23, 2014 3:30 pm
Forum: Investing - Theory, News & General
Topic: Risk in a high dividend stock portfolio
Replies: 19
Views: 3867

Re: Risk in a high dividend stock portfolio

FWIW, I think that this approach is way too risky. Investing in a company (or 50 companies) just because they have high dividends is a recipe for regret. If you're going to buy a "dividend stock", it's usually a much better bet to purchase a blue chip with solid fundamentals. And diversify widely. Better to get the return OF your money than shoot for a return ON your money. In any case, the amount of the dividend is a secondary concern. However, this approach is not preferred on this board, so I wouldn't expect much encouragement here. I think it's possible to put together a solid portfolio of 20-30 dividend aristocrats and arrange a 4% dividend or so. Usually shooting for much more invites trouble. Still: a simpler approach might...
by SpaceCommander
Thu Oct 23, 2014 3:05 pm
Forum: Investing - Theory, News & General
Topic: GT Advanced Technology Files for Chapter 11
Replies: 9
Views: 2644

Re: GT Advanced Technology Files for Chapter 11

Anyone who was closely following the company would have noticed that insiders had been dumping the stock hand over fist since July. It's usually not a good sign when top executives and directors are exercising their options and immediately liquidating 100%. A look at insider selling is breathtaking. Maybe if you were a shareholder, you might want to take a hint... Stuff like this happens to people who choose to invest in individual stocks based on their personal analysis, and those of analysts saying "GT Advanced Technologies is in a great position to profit from several angles. So, investors should take a closer look at the company as it can be a long-term outperformer." I hope you are not saying "it shouldn't have happened...
by SpaceCommander
Thu Oct 23, 2014 2:56 pm
Forum: Personal Finance (Not Investing)
Topic: Is investing in real estate worth it?
Replies: 28
Views: 4699

Re: Is investing in real estate worth it?

But, real estate does add an entirely different type of asset and income stream to the mix. That's one of the main reasons I like it, I consider it a form of meta-diversification. Oh and real estate is fantastic at throwing off reliable cash flows, much better than a financial portfolio in that respect. I got a chuckle out of this. Indeed, real estate is great at throwing off reliable cash flow. Unfortunately, that cash flow is not always positive! Ever heard of NEGATIVE cash flow? Yeah, nobody goes into the real estate business looking forward to that, but it's real; and it happens all the time! Unanticipated expenses have a curious way of sneaking up on you. A couple thousand here, another 10 grand there, and before you know it, there we...
by SpaceCommander
Wed Oct 22, 2014 7:44 pm
Forum: Personal Finance (Not Investing)
Topic: Is investing in real estate worth it?
Replies: 28
Views: 4699

Re: Is investing in real estate worth it?

But, real estate does add an entirely different type of asset and income stream to the mix. That's one of the main reasons I like it, I consider it a form of meta-diversification. Oh and real estate is fantastic at throwing off reliable cash flows, much better than a financial portfolio in that respect. I got a chuckle out of this. Indeed, real estate is great at throwing off reliable cash flow. Unfortunately, that cash flow is not always positive! Ever heard of NEGATIVE cash flow? Yeah, nobody goes into the real estate business looking forward to that, but it's real; and it happens all the time! Unanticipated expenses have a curious way of sneaking up on you. A couple thousand here, another 10 grand there, and before you know it, there we...