Thinking of selling some SP 500 to buy more Wells Fargo

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William Million
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by William Million » Sat May 23, 2020 2:08 pm

Unlike some on Bogleheads, I invest in individual stocks (though most of my equity money is in broad US or international index funds).

I think WFC is now a good investment for patent investors. The 8% dividend looks pretty firm for now. When we reach full recovery mode, the stock should get back to 40s or 50s. Could be in Sept - then again, could be Sept 2023.

However, if you already own some, I don't see any reason to buy more. Even Bogleheads who invest in individual stocks take diversification and risk mitigation very seriously.

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HenrysPlan2
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by HenrysPlan2 » Sat May 23, 2020 2:16 pm

William Million wrote:
Sat May 23, 2020 2:08 pm
Unlike some on Bogleheads, I invest in individual stocks (though most of my equity money is in broad US or international index funds).

I think WFC is now a good investment for patent investors. The 8% dividend looks pretty firm for now. When we reach full recovery mode, the stock should get back to 40s or 50s. Could be in Sept - then again, could be Sept 2023.

However, if you already own some, I don't see any reason to buy more. Even Bogleheads who invest in individual stocks take diversification and risk mitigation very seriously.
Thanks, that’s what I was thinking.

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HenrysPlan2
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by HenrysPlan2 » Sat May 23, 2020 2:18 pm

I also need to think about how to invest the proceed on the sale of my investment properties. Might have at least $800k

illumination
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by illumination » Sat May 23, 2020 2:54 pm

Is the only reason you think Wells Fargo makes sense to buy more is because you've already lost money on it?

BNY Mellon bank is older than Wells Fargo and was established in 1784, a few weeks ago the stock was around 50% of its 52 week high. Why not say Exxon Mobil that has lost about half its value? Or Royal Dutch Shell? Or General Electric?

There's plenty of stocks that have lost massive value that are pretty iconic companies and you're putting all your eggs in one basket. It's not automatic they all bounce back to their previous price. Lehman Brothers was around 170 years old and pre dated the Civil War and they went bankrupt, so you can pick the wrong one.

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anon_investor
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by anon_investor » Sat May 23, 2020 2:59 pm

HenrysPlan2 wrote:
Sat May 23, 2020 2:18 pm
I also need to think about how to invest the proceed on the sale of my investment properties. Might have at least $800k
Check out VBIAX (Vanguard Balanced Index Fund).

ColoradoRick
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by ColoradoRick » Sat May 23, 2020 3:31 pm

OP - - just some actual experience for you to contemplate. In addition to index funds we had enough of financials (combination big banks and brokers) that the dividends (many of which were 4 to 5% at the time) paid our house payment in early 2000s. Well respected (Wells Fargo/Bank of America/American Capital). Did great until 2007. First 2 were too big to fail. Didn't stop us from losing 6 figures. Dividends disappeared. It really really hurt.

Yes, you could do very well with it. Great dividend. Unless/until the board cuts it or Fed tells banks to stop or cut dividends to raise capital. So our plan worked until it didn't. Waited 3 years and they showed no signs of getting better. Sold, reinvested in index and got it all back.

I still have individual stocks in addition to our index fund. But if I read it correctly you are going very heavy Wells Fargo. It seems like a sure thing. There is a reason financials command a lower P/E than most stocks. They are highly leveraged, even though not as high as 2008, and it doesn't take much to go wrong for you to lose a lot of money. My expensive tuition lesson is don't go more than 5 to 10% of your total net worth into it. And 10% is really too much, but you can recover from that if you are young. Good Luck.

7eight9
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by 7eight9 » Sat May 23, 2020 3:43 pm

anon_investor wrote:
Fri May 22, 2020 11:30 pm
HenrysPlan2 wrote:
Fri May 22, 2020 11:01 pm
Warren Buffett said stock “short term is voting machine, long term is weighting machine”
Warren Buffet also recommends an S&P500 index fund to most investors...

viewtopic.php?t=315596
Berkshire Hathaway also has a significant stake in WFC ...

Approximately 69% of the aggregate fair value was concentrated in five companies (American Express Company – $13.0
billion; Apple Inc. – $63.8 billion; Bank of America Corporation – $20.2 billion; The Coca-Cola Company – $17.7 billion and
Wells Fargo & Company – $9.9 billion).
https://www.berkshirehathaway.com/qtrly/1stqtr20.pdf
I guess it all could be much worse. | They could be warming up my hearse.

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anon_investor
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by anon_investor » Sat May 23, 2020 3:46 pm

7eight9 wrote:
Sat May 23, 2020 3:43 pm
anon_investor wrote:
Fri May 22, 2020 11:30 pm
HenrysPlan2 wrote:
Fri May 22, 2020 11:01 pm
Warren Buffett said stock “short term is voting machine, long term is weighting machine”
Warren Buffet also recommends an S&P500 index fund to most investors...

viewtopic.php?t=315596
Berkshire Hathaway also has a significant stake in WFC ...

Approximately 69% of the aggregate fair value was concentrated in five companies (American Express Company – $13.0
billion; Apple Inc. – $63.8 billion; Bank of America Corporation – $20.2 billion; The Coca-Cola Company – $17.7 billion and
Wells Fargo & Company – $9.9 billion).
https://www.berkshirehathaway.com/qtrly/1stqtr20.pdf
And Berkshire Hathaway has under performed vs. the S&P500 for quite some time now...

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Nate79
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by Nate79 » Sat May 23, 2020 4:41 pm

Ah, as Clark Howard says The Criminal Enterprise known as Wells Fargo. Sadly my mortgage servicing just transferred to them. Oh well. How they stayed out of jail we will never know.

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anon_investor
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by anon_investor » Sat May 23, 2020 4:46 pm

Nate79 wrote:
Sat May 23, 2020 4:41 pm
Ah, as Clark Howard says The Criminal Enterprise known as Wells Fargo. Sadly my mortgage servicing just transferred to them. Oh well. How they stayed out of jail we will never know.
Enjoy the annoying popup ads when you login inviting you to open a WF CC or bank account...

RiotAct
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by RiotAct » Sat May 23, 2020 10:56 pm

YOLO!

Northern Flicker
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by Northern Flicker » Sat May 23, 2020 11:40 pm

HenrysPlan2 wrote:
Fri May 22, 2020 8:06 pm
SP 500 has risen so much while Wells Fargo Still near it’s 5 years time low with still 50% down. While the well Fargo will never go away, it’s a matter of time the stock goes back to $50 like couple if months ago?
Says who? If that were a likely scenario, the market would already have bid up the price.
Risk is not a guarantor of return.

hoops777
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by hoops777 » Sun May 24, 2020 5:57 pm

All the big banks have been hit hard.They will return in time. Buying some WF with some FUN money is not a bad idea.
Listened to an hour long podcast a couple weeks ago or so and the head of a 50 year old fund that has beaten the SP 500 the last 50 years mentioned banks.
The question was is there any sector you think has not recovered with the market that is possibly undervalued, or something like that. :D
He really did not want to name names but after some prodding he said big banks,especially WF and also B of A and Capital One.
He said WF could go through the government stress test and still be profitable.
This guy is an old timer and more of a Buffet type and definitely not a loudmouth on CNBC.
So for whatever that is worth which I know is less than pennies here. :happy
Before you attack remember I said fun money.
K.I.S.S........so easy to say so difficult to do.

retired@50
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by retired@50 » Sun May 24, 2020 7:45 pm

hoops777 wrote:
Sun May 24, 2020 5:57 pm

Listened to an hour long podcast a couple weeks ago or so and the head of a 50 year old fund that has beaten the SP 500 the last 50 years mentioned banks.
Who is the person?

What is the fund?

Regards,
This is one person's opinion. Nothing more.

hoops777
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by hoops777 » Sun May 24, 2020 8:07 pm

retired@50 wrote:
Sun May 24, 2020 7:45 pm
hoops777 wrote:
Sun May 24, 2020 5:57 pm

Listened to an hour long podcast a couple weeks ago or so and the head of a 50 year old fund that has beaten the SP 500 the last 50 years mentioned banks.
Who is the person?

What is the fund?

Regards,
Chris Davis from NY Capital Venture on Morningstar the Long View podcast.
K.I.S.S........so easy to say so difficult to do.

TheDDC
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by TheDDC » Sun May 24, 2020 8:07 pm

HenrysPlan2 wrote:
Sat May 23, 2020 12:24 pm
I am preparing to sell one of my investments Propety, so Wells Fargo is kind of play money for now. By taking the advice, mostly I will not increase the position. But after the sale of the property, it will be a difficult choice again for the courage to put all the money to the market
Also my plan is to sell Wells Fargo once it recover to near $45, hopefully I hold it a year to offset my lost(tax hervest in March for a big lost).
Stick with real estate investing. It will pay off better than going down the road that you clearly think will pay out more...

-TheDDC
Rules to wealth building: 90-100% VTSAX piled high and deep, 0-10% VIGAX tilt, 0% given away to banks, minimize amount given to medical-industrial complex

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HenrysPlan2
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by HenrysPlan2 » Mon May 25, 2020 3:41 am

Real estate is becoming expensive too, I think selling real estate is not a bad idea. But need a chance to put the money to the indexes. More worry about being with cash and does not have the courage to get in the market.

bugleheadd
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by bugleheadd » Mon May 25, 2020 5:51 am

I would invest in Tesla, not wells fargo

jb1
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by jb1 » Mon May 25, 2020 6:39 am

bugleheadd wrote:
Mon May 25, 2020 5:51 am
I would invest in Tesla, not wells fargo
Yup. Wish I had more! I’m seeing more and more Tesla’s everyday

UpperNwGuy
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by UpperNwGuy » Mon May 25, 2020 7:14 am

I agree with the others who have commented. Investing any more into Wells Fargo is a bad idea.

REITired
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by REITired » Mon May 25, 2020 8:29 am

I would say, you tried, it failed.

It might not be as fun, but stick with SP500.

JW-Retired
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by JW-Retired » Mon May 25, 2020 11:25 am

This reminds me of when wife and I still had a few individual stocks. We bought some Washington Mutual stock ("WaMu", ticker WM) in 2006. I've forgotten whatever reasons I had for picking it, except I do recall one of my kids banked there and really liked it.

In September 2008 WaMu failed. (I had sold out in late August for 9% of our purchase price.) According to Wikipedia..... "Regarding total assets under management, WaMu's closure and receivership is the largest bank failure in American financial history."

WaMu was the last individual stock we ever bought so IMO this was a good thing for us! :D
JW
Retired at Last

Crmck26
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by Crmck26 » Mon May 25, 2020 11:54 am

HenrysPlan2 wrote:
Fri May 22, 2020 7:44 pm
Dear all, recently bought about $40k Wells forgo at $25.5 each. Since this stock have been beaten up so much and I am out of funds, I am thinking to sell $50k-$80k vanguard SP 500 on my tax to buy Wells Fargo. Compare to 2009, the bank stocks rised 3 times in 2-3 months just from March low, also Wells Fargo is too big to fail bank. Before I make the decision, I would like to have some inputs to avoid bad decisions. I am still down 15% this year since I moved the funds and sold off the total international and didn’t get back in right away.
I get it and it is tempting, especially if they manage to keep their dividend. Boglehead philosophy aside for a moment, this individual stock is risky even for individual stocks. Assuming their history of illegal banking moves doesn’t repeat itself, how good is this company, especially relative to other banks, at management and providing the services they sell? In my recent experience, not good.

I tried to open a simple WF checking account 2 weeks ago. I’ll admit, just for the tempting $400 bonus. Thought I would see what the “new” WF is. Remember those apology commercials they used to run? Inspiring - https://www.ispot.tv/ad/AWeJ/wells-fargo-commitment

Anyways long story short it has been a nightmare. My initial funding deposit was rejected, causing a bank fee. Then I called customer service to fix the problem. 45 minutes later of talking and was told they don’t know what is going on; they cannot provide me with my account number over the phone but I do have an account; that I can’t get that information until it comes in the mail; that deadline has already past; they sent me a debit card on Friday in the mail but with no account information and no money in it of course. I can’t imagine how the next customer service call will go. Probably won’t qualify for the bonus either at this point.

Do you want to invest in a bank that can’t manage to open a checking account?

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HenrysPlan2
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by HenrysPlan2 » Tue May 26, 2020 2:41 pm

Looks like the bank stocks are rising a lot today. Some people said it’s due for a rotation to small caps and bank stocks once the whole market stabilized.

Livelife2fullest
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by Livelife2fullest » Thu Jun 04, 2020 2:04 pm

HenrysPlan2 wrote:
Tue May 26, 2020 2:41 pm
Looks like the bank stocks are rising a lot today. Some people said it’s due for a rotation to small caps and bank stocks once the whole market stabilized.
Looks like your prediction has been correct so far. Over the last few weeks there have been significant gains to bank stocks. WFC is up around 30+% since mid-May. Nice buy, if you did follow through with the investment.

BW1985
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Re: Thinking of selling some SP 500 to buy more Wells Fargo

Post by BW1985 » Thu Jun 04, 2020 2:35 pm

Crmck26 wrote:
Mon May 25, 2020 11:54 am
HenrysPlan2 wrote:
Fri May 22, 2020 7:44 pm
Dear all, recently bought about $40k Wells forgo at $25.5 each. Since this stock have been beaten up so much and I am out of funds, I am thinking to sell $50k-$80k vanguard SP 500 on my tax to buy Wells Fargo. Compare to 2009, the bank stocks rised 3 times in 2-3 months just from March low, also Wells Fargo is too big to fail bank. Before I make the decision, I would like to have some inputs to avoid bad decisions. I am still down 15% this year since I moved the funds and sold off the total international and didn’t get back in right away.
I get it and it is tempting, especially if they manage to keep their dividend. Boglehead philosophy aside for a moment, this individual stock is risky even for individual stocks. Assuming their history of illegal banking moves doesn’t repeat itself, how good is this company, especially relative to other banks, at management and providing the services they sell? In my recent experience, not good.

I tried to open a simple WF checking account 2 weeks ago. I’ll admit, just for the tempting $400 bonus. Thought I would see what the “new” WF is. Remember those apology commercials they used to run? Inspiring - https://www.ispot.tv/ad/AWeJ/wells-fargo-commitment

Anyways long story short it has been a nightmare. My initial funding deposit was rejected, causing a bank fee. Then I called customer service to fix the problem. 45 minutes later of talking and was told they don’t know what is going on; they cannot provide me with my account number over the phone but I do have an account; that I can’t get that information until it comes in the mail; that deadline has already past; they sent me a debit card on Friday in the mail but with no account information and no money in it of course. I can’t imagine how the next customer service call will go. Probably won’t qualify for the bonus either at this point.

Do you want to invest in a bank that can’t manage to open a checking account?
Surprising, that has not been my experience at all. I've opened 3 accounts in the last year and everything was fine. Only thing to be aware of is that if the account is 0 balance they will close it after a little while.
Chase the good life my whole life long, look back on my life and my life gone...where did I go wrong?

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