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Stock Market
I have decided to invest in some stocks and I have made the decision to do my own research. I have a time frame of when I am thinking of selling some or most of them. My goal is around 15% return each year. I have alerts so that I will not loose very much if the chance my stocks start nose diving.
I made the decision to buy from solid companies. I might invest in one or two more speculative companies. A number of the stocks I look to purchase are pay dividends.
It seems much better to put my savings in the stock market then a bank were I only earn .075% and that is from a internet bank. My goal is to invest 20-25k this year and next year 25-30k
with increments of 2-3k a month.
To all my fellow investors good luck. -
756 Replies
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Good luck with getting 15% per year. Ambitious 🙂
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Hi Dergon,
thanks for wishing me luck. 15% will be a good year, but I believe it can be done. With doing plenty of research and buying at the right time hopefully I meet my goal, but even if I only reach 7% that would be 10 times more than I can get in my personal savings. My 403b earns on average around 10%
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[:@] ya mon.. way to go. hope you will make tons of $$$$$$$
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If all you want is 15% per year, then why bother with anything other than Apple? It is the biggest cap corp on the planet by far, is very cash-rich, has no long-term debt, and still has a P/E less than 20. It is gaining market share as the kids who went to schools that were furnished by Apples have grown up and are spreading Apples around the home and business. But despite its success, Apple computers still only comprise 25% saturation, indicating that there is still a huge market left for it to pursue.
It’s iPhone has hooked about 50% of the smart phone market in the US, and it virtually owns much of the music market. In fact the only market it has not yet significantly penetrated is TV and movies, and it’s currently working on that too. The most dire predictions (based on the presumed lack of visionary replacement to Jobs) is that Apple will run out of ideas and start its decline in no less than 5, and more likely at least 10, years from now.
You might also look into companies making advances in internet bandwidth, because the rate of data transfer over the internet (both hardwire and wi-fi) has become the biggest bottleneck to computer power these days. Network speed is arguably the biggest (yet largely unspoken) limitation to cloud technology, especially when considering hi-def graphic transfers and huge backup volumes.
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I disagree about AAPL. I see it as high-risk. Its stock price has already seen parabolic growth this year.
It’s easy to get 15% stock price appreciation when the company has a small market cap. At $500 billion, it’s not so easy.
If you want to buy AAPL, be very nimble.
I suggest a diversified portfolio to protect yourself. I prefer slow, steady gains and am happy with 5%. Anything more is a bonus.
If you can pull 15% consistently, you should become a money manager.-
Quote from BarelyPassed
If you can pull 15% consistently, you should become a money manager.
This is KEY!
You really think you can do 15% when no one…NO ONE who is a professional can do this? Heard of Madoff? That is what he promised and got…except that he didn’t really get it. He had investors beating down his door to get into his investment scheme because he got returns of 15% and no one else could. People were fighting to get in.
So if you can do this, you are one person out of many millions who are trying to do it – all of whom have more experience than you.
If there were ANY person who could pull this off, they would have a mutual fund that would be the talk of the investment community, it would be closed to new investors, but there would be knock-offs, copying their every move. This would cause artificial moves in the stock – every time this guy bought something, everyone else would, causing a bubble, which would burst and bring everything crashing to earth.
I just was reading the thread on the ER docs reading their own films. They think they are better than us because they occasionally find a fracture that we don’t (knowing exactly where it hurts). This kind of thinking is known as confirmation bias. If you get 10-15% one year, you think you have the key until you lose 50% one year. (I speak from experience. Ugh.)
Do yourself a very big favor and read The Black Swan by talib. A deeply thought out book about market investing that has proven to be correct several times over.
Also must reading is The Big Short by Michael Lewis…. This will demonstrate to you how the market is manipulated by some big players and if you are not one of them, you are just pebbles under their tires.
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Sardonicus makes good points. You’re not going to average 15% per year. You’re probably not going to beat the market much more than half the time either. You’re best off if you understand that going in so that you can have your approach set before you get disappointed and start the self-defeating process of moving money around willy-nilly to make some unatainable target point.
I consider myslef *mostly* a Boglehead.
Invest early and often (ideally with a pre-set monthly deduction…you can try to time the dips, but 50% of the time you’ll be wrong anyway), never bear too much or too little risk (ie- learn about age-appropriate asset allocation), diversify, and don’t try to time the market.
Once you’ve come to that notion above then you have to keep your costs low (use a low cost brokerage, buy individual stocks or cheap index funds, watch the tax implications).
Then…. STAY THE COURSE! Don’t let market shifts (even big ones) knock you off of your plan.
Do all that and you’ll be better than 90% of the retail “little guy” investors out there.
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The more I evolve as an investor the more I realize that when the market is up I don’t even pay attention to buying stocks. I look at what you have to sell and take profits.
I have essentially 2 strategies.
1. Buy stocks with history of increasing dividends and hold them until they stop doing that.
2. Hold the cash until the market corrects at least 8-10% then start buying
As far as 15% per year every year year in and year out you’d have to get lucky and not miss on much as even strong companies have down years and suffer through cyclical downturns. That being said I don’t think that averaging 10%-15% per year….year in year out is too unreasonable if you are talking return on original investment as long as you reinvest the profits
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Peter Lynch averaged 29% from 1977-1990 Manager for Fidelity.
Warren Buffett 22% 1967-1994
15% is still my goal
there has been years where my 403b mutual fund account has averaged over 15 percent
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Quote from irayd8u
Peter Lynch averaged 29% from 1977-1990 Manager for Fidelity.
Warren Buffett 22% 1967-1994
15% is still my goal
there has been years where my 403b mutual fund account has averaged over 15 percentAnd lynch wrote a book on how to do it, but no one else can……What could that mean?
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Whoever said why buy anything other than Apple? Diversification is a way to limit your risk. Don’t put all your eggs in one basket.
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Some point soon apples growth will slow and it wil be like other companies that have done the same
IBM, Intel. Microsoft
Good companies but Microsoft and intel from 2000-2010 really did little
Apple is overvalued. Once growth slows it will grind to a halt and do very little for 10 years or so until earnings catch up to the price
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Quote from kpack123
Some point soon apples growth will slow and it wil be like other companies that have done the same
IBM, Intel. Microsoft
Good companies but Microsoft and intel from 2000-2010 really did little
Apple is overvalued. Once growth slows it will grind to a halt and do very little for 10 years or so until earnings catch up to the price
Valuation is typically reflected in the P/E, and Apple’s P/E is hovering around 20 which is below the average for that industry sector (regardless of what “sector” you consider Apple to be in these days). There is no objective basis for saying that at[i] “some point [/i][u][i]soon[/i][/u][i] Apple’s growth will slow”[/i]. It is doing well because it finally is positioned to penetrate the markets that Scully failed to grab back in the ’90s. And so Microsoft had a great run for more than 30 years because of that (mainly due to Scully’s poor management of Apple’s IP), and ONLY in the desktop computer market. Since then, Apple has developed new products that will penetrate far more than the computer market into new areas with tremendous growth potential, leaving MS, Intel and everyone else far behind, with still plenty of headroom to go. There is nothing about the market, Apple’s current size, Apple’s current market strategy, Apple’s fundamentals, or the economy that would indicate its growth will slow down any time soon.
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Microsoft run was 10-15 years
Apples a great company and will continue to grow but investor return won’t go up forever
You need to catch the bus before it leaves the station
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Quote from kpack123
Microsoft run was 10-15 years
Yes, that’s correct. I was blurring stock price with their market penetration, the latter being enjoyed far longer than their run in stock price. Thanks for clarifying.
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Quote from kpack123
You need to catch the bus before it leaves the station
Or you can realize that for the average retail investor this is like catching lightning in a bottle and leads to a too heavily risk based allocation and instead focus on getting returns even with the market by keeping costs low and not doing stupid things.
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By the way, regarding the three companies you cited:
1. IBM
This arrogant elephant was destined to lose the computer market the moment Apple released it’s first computer. IBM made the mistake of not having the vision of decentralized computing and considered all such products to be merely “toys” with no practical value. They blinked, and other than a good run with laptops for a few years, they got wiped out by the wave they could have owned. And the irony is that with cloud technology, computers will become more centralized again, but IBM will have a marginal presence in that market except perhaps in the ecommerce platform and storage sectors.
2. Intel
A parasite company, totally dependent on Microsoft Windows sales for most of its success. When MS started to plateau, Intel scrambled and, fortunately for them, was embraced by Apple, which continued its run at MS’ expense. I’m pretty sure that Intel is eternally grateful that Motorola wasn’t able to reduce the power requirements of their newer chips sufficiently for use in laptops.
3 Microsoft
I don’t think anyone needs to rehash Microsoft’s blunder after blunder. They failed in phones, games, media streaming, and just about every aspect of computer other than pimping out Windows to anyone with fingers. Their Office suite is a 40 ton gorilla. New updates are simply facelifts on the same old “90% useless” functionality. All they did was create a reasonably stable and inexpensive operating system which hooked the planet to its desktop platform. The only genius Gates exhibited was to make the OS difficult to use and maintain, which insured the job security of corporate MIS, and it’s no coincidence that MIS is charged with the responsibility to recommend and manage the “best” computer platform for the corporation.
What all those companies failed to acknowledge, however, is that computers would evolve into being but one component in a spectrum of technology platforms, such as digital entertainment, communication, education, etc., and Apple, for whatever reason, took the steps to entrench themselves comfortably into each interdependent market – it never ceases to amaze me how quickly RIM gave away the smart phone market on a gold platter; that story’s never getting old.
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Dan,
Agree, Agree, Agree
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Quote from DICOM_Dan
Whoever said why buy anything other than Apple? Diversification is a way to limit your risk. Don’t put all your eggs in one basket.
There is a mutual fund that does really well investing in media and telecommunication companies where it seems all the growth is. Is kinda in the same area as Apple. T Rowe Price Media and Telecommunications Fund. PRMTX. In fact Apple is this funds largest holding-along with Comcast, Disney and ATT. Take a look –[link=http://quote.morningstar.com/fund/f.aspx?t=PRMTX®ion=USA&culture=en-us]http://quote.morningstar….=USA&culture=en-us[/link]
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I bought good chunks of AAPL last year at 390 then again at 380. It’s up 60% since then.
But I did not buy it as a short term investment. I’m 10-20 years long on it like I am the rest of my portfolio.
Yeah, I’ll sell a real dog or acknowledge a mistake now and then, but for the most part I’m just waiting to sell it when I actually need the money in retirement.
I hold only a few individual stocks (less than 10% over my portfolio). Elsewise I am a boring “dollar-cost-avergaing every month, keep my expenses low in (I like Vanguard), buy indexes or quality sector funds and don’t move it around too much” kind of guy.
For the OP, I was being polite when I wished you good luck at the top of the thread. If you think you’re going to get 15% over the long term while the average return is 9% you are almost certainly deluding yourself. I don’t say this to be mean, but to save you from taking undue risk while chasing unrealistic return targets which can really hurt you financially in the long run.
From the numbers you’re citing YTD it sounds like you’re just about even with the market…….. that’s not such a bad thing. 🙂
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Quote from BarelyPassed
I disagree about AAPL. I see it as high-risk. Its stock price has already seen parabolic growth this year.
It’s easy to get 15% stock price appreciation when the company has a small market cap. At $500 billion, it’s not so easy.
Looks like you were correct with this analysis.
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I recently bought a small amount of Apple stock and it has been performing very well. I think I am up currently 8% I am very happy. My other holdings one is about even and the other is up 11%. One account that is a non retirement mutual fund is up 11% as well. My 403b is up about 10% this year. I hope others are doing well this year. Would love to hear from you and continued success.
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Sell it
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Go read rich dad, poor dad. Then when the next recession hits, start buying real estate as fast as you can (borrow like crazy).
your returns will be more like 50% during downturns with very low risk compared to stocks which are quite volatile even stocks like AAPL.
Real estate: leverage + tax advantage + cash flow + appreciation + control/true ownership
Stocks: volatile + no control + dividend stocks are joke compared to cash flowing real estate + reacts to global markets within seconds
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Not a lot of tax advantage to real estate anymore
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Quote from guess
Go read rich dad, poor dad. Then when the next recession hits, start buying real estate as fast as you can (borrow like crazy).
I did read it and had a really good laugh. It is “the Onion” of financial planning.
[link=http://www.forbes.com/sites/helaineolen/2012/10/10/rich-dad-poor-dad-bankrupt-dad/]http://www.forbes.com/sit…poor-dad-bankrupt-dad/[/link]-
Apple is simply the greatest money making machine in the history of mankind. There is no reason not to hold this stock until the iPhone starts to fade. They are a one trick pony but it is an amazing trick.
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Paltry GDP, as predicted. No growth in the economy. Who cares if rich people and corporations can make money (created out of thin air) by getting almost costless loans? The only reason GDP was up at all for the last year was (and I said it at the time) because of more QE style pumped money into a broke system (Obamacare money was the input).
And the Keynesians still say they care about wealth disparities and the middle class… They sure don’t act on their behalf.-
You don’t turn 35 years of GOP “solutions” around overnight anymore than you can turn the 2008 recession easily around. It took years for the Great Depression & WWII “Keynesian stimulus” to turn that around.
I agree that the Banks could have been held more responsible but as to letting the economy burn down & rebuild, not a good alternative & “proof” of the recession not being so bad because of where we are now is like the drowning man being saved by a floatation device & then saying he was never really in trouble once he was actually saved. It’s not like you can re-do the event this time without the life preserver & see just how much in trouble he really was.
“I lived! so I was never really in trouble!”
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[link=http://www.chicagobooth.edu/capideas/magazine/spring-2015/how-the-banking-industry-breeds-dishonesty]http://www.chicagobooth.e…stry-breeds-dishonesty[/link]
an interesting study about bankers. A fuller examination of the subject, and how Morgan Stanley is different, is seen in a recent Atlantic Monthly article.
I wish the study would have tested some other occupations.-
Great opportunity to pick up AAPL after nonsensical 6% drop after stellar earnings.
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Quote from macrophallus
Great opportunity to pick up AAPL after nonsensical 6% drop after stellar earnings.
Agree, but i think overall confidence in economy is fading. Appl aside, we can’t take another quarter of anemic numbers and expect to sustain current evaluations.
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[url=http://seekingalpha.com/article/3165076-yellen-is-yell-ing-about-high-stock-prices]
[h1]Yellen Is ‘Yell-ing’ About High Stock Prices![/url][/h1]Earlier this week, Janet Yellen, chair of the U.S. Federal Reserve, spoke at the Institute for New Economic Thinking conference at the IMF headquarters in Washington, D.C. In addition to pontificating about the state of the global economy and the direction of interest rates, she also decided to chime in with her two cents regarding the stock market by warning stock values are “quite high.” She went on to emphasize “there are potential dangers” in the equity markets.
Unfortunately, those investors who have hinged their investment careers on the forecasts of economists, strategists, and Fed Chairmen have suffered mightily. Already, Yellen’s soapbox rant about elevated stock prices is being compared to former Fed Chairman Alan Greenspan’s “Irrational Exuberance” speech.
…
I freely admit stocks will eventually go down, most likely a garden variety -20% recessionary decline in prices. While from a historical standpoint we are overdue for another recession (about two recessions per decade), this recovery has been the slowest since World War II, and the yield curve is currently not flashing any warning signals. When the eventual stock market decline happens, it likely will not be driven by high valuations. The main culprit for a bear market will be a decline in earnings – high valuations just act as gasoline on the fire. Janet Yellen will continue to offer her opinions on many aspects of the economy, but if she steps on her soapbox again and yells about stock market valuations, you will be best served by purchasing a pair of earplugs.
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Personally I would not mind a 20% pull back although I’m thinking it will be more like 10-15%
If the pullback occurs……I back the truck especially if interest rates rise because most bank stocks are cheap
My gameplan is if a pullback occurs and interest rates rise I double my holdings in JPM US Bank and a handful of regionals
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Quote from irayd8u
I have decided to invest in some stocks and I have made the decision to do my own research. I have a time frame of when I am thinking of selling some or most of them. My goal is around 15% return each year. I have alerts so that I will not loose very much if the chance my stocks start nose diving.
I made the decision to buy from solid companies. I might invest in one or two more speculative companies. A number of the stocks I look to purchase are pay dividends.It seems much better to put my savings in the stock market then a bank were I only earn .075% and that is from a internet bank. My goal is to invest 20-25k this year and next year 25-30k
with increments of 2-3k a month.
To all my fellow investors good luck.
Someone in this discussion said to stay away from Apple because it is too “risky”? Compared to what?! By definition, stocks are risky. But what’s important is choosing the stock with a relatively smaller than average risk. What is it about Apple’s current product/market strategy that makes it “risky” over the next 5 years? According to just about every metric, Apple is about the least riskiest stock on the planet BECAUSE it is by far the highest market cap company (i.e., fully embraced by big institutions) while still managing to maintain a below average P/E in expanding markets (i.e., still a huge untapped profit potential). Despite the unfounded warnings posted in this discussion, while Apple is indeed the biggest corporation in America, the reason it will continue to grow at rates higher than 15% each year is that it still has a remarkable amount of headroom in every market it’s in (with the possible exception of the “mp3 player” market which it basically owns at this point).
If you are gravitating toward a “fund” strategy rather than selecting individual stocks, keep in mind that the historic record shows that a “diversified” fund rarely will get you an edge on the overall performance of the market. Such funds won’t get you 15%/yr over the long haul. Only a “specialized portfolio” can get you an edge, by definition really. For example, consider investing in a well-managed fund in the “elderly care” sector or anything else that relates to aging Boomers. “Aging Boomers” comprise a specialized market positioned for unquestionable, significant growth for at least the next 10-15 years.
But the standard strategies of “diverse portfolios”, “dollar cost averaging”, 401k tax deferral, etc. all barely will let you stay even with the market. That’s born out pretty clearly if you simply trace the market over the past 20 years. (Be VERY cautious of any claims that track history of a stock/fund over an arbitrary time period, such as [i][u]between[/u][/i] recession cycles, before any “corrections” have occurred in skewed, short-term valuations).
My bottom line to you is, do [u]not[/u] diversify with a general fund; instead look into holding a [u]specialized[/u] portfolio (be it funds or individual stocks). Whatever you do, steer clear of stagnant markets where every player must resort to expensive competition in order to steal share from each other. Rather, go for new, expanding markets where even a decrease in market share still can translate to a tremendous increase in profit annually.
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irayd8u,
Good luck with 15%. I’ve had a number of investments higher than 15% but not as a routine. Regarding investment techniques, are you in for short-term trading or looking long-term investments? I’ve always preferred long-term as I don’t check out my investments minute-by-minute or daily. And paying attention to herd fluctuations can be nerve wracking. Timing & luck are critical. You can find & read a lot of techniques but there are no shortcuts outside of learning the market, the stock & then still keeping your fingers crossed.
As for Apple. I’ve done very well with AAPL having bought in when it was almost a penny stock. As for it failing any day now? Heard that before. I’ll keep riding the wave until I know it’s dying. Or it becomes Microsoft by another name.
[link=http://www.macobserver.com/tmo/death_knell/]http://www.macobserver.com/tmo/death_knell/[/link]The Apple Death Knell Counter (ADKC) is a collection of death pronouncements for Apple throughout the years. Issued by journalists, analysts, pundits, business executives, and the like, there have been innumerable “Apple is dead,” “Apple will soon be dead,” and “Apple is dead if they don’t do this or that” statements issued by all sorts of people who have been proven time and again to be wrong.
[size=”2″]Remember Steve Jobs had the last laugh against Michael Dell, “F*ck Michael Dell!”[/size]
[size=”2”][link=http://articles.businessinsider.com/2011-10-10/tech/30262328_1_apple-employees-fred-anderson-sculley]http://articles.businessi…-fred-anderson-sculley[/link]
[/size]
There is and has always been a business & market bias against Apple. They were never “serious” enough in the minds of businesses & the markets.The nay-sayers are always with us. There is a theory as to why AAPL keeps dropping just before quarterly profit announcements, and it has to do with increasing earnings for the investors. Sell, then talk it down just before the earnings announcements then buy in & watch it rise in price again even higher.
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Apple can’t continue to grow at their prior pace
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Quote from kpack123
Apple can’t continue to grow at their prior pace
But they can continue to make a crapload of $$$$ if they keepp doing the right things. Maybe AAPL transforms into one of those continuously increasing dividend stocks you like. Maybe in 2025 AAPL looks more like COKE
*shrugs*
If I knew the answer to that an most other future stock questions I wouldn’t be reading films anymore.-
I am fine with earning market returns using index funds. As a high income rad, there is no reason to take on excessive risk other than greed. Remember, as your ability to take risk increases, your need to decreases.
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Quote from macrophallus
I am fine with earning market returns using index funds. As a high income rad, there is no reason to take on excessive risk other than greed. Remember, as your ability to take risk increases, your need to decreases.
+1 – I am with the big guy – capital preservation is the key!
15% per annum is not realistic. This target shows a level of naivety that may prove a little costly. Active management and market timing – two concepts that the original poster eludes to – do not work.
15% compounded means a doubling of your initial investment in less than 5 years. Whereas you may achieve this through Loan Sharking, prostitution or Cooking Meth – your state medical licensing authority may frown upon these activities ……-
What sort of ETFs are folks using and what brokerage? Thanks
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Quote from radioman_10
What sort of ETFs are folks using and what brokerage? Thanks
Any of the low cost brokerage houses will do. Vanguard, Schwhab, Fidelity …. TD, e-trade. I am with Schwab but have some Vanguard funds in holding.
Some of the ETFs — I have VB (Vanguard small cap) , EFA (foreign large blend), VDE (Vanguard energy), SCHC (International Small Cap) ; VNQ and VNQI (domestic and international REIT) -
Quote from radioman_10
What sort of ETFs are folks using and what brokerage? Thanks
Vanguard & Fidelity.
Admiral index mutual funds and individual corporate bonds in a tax deferred fidelity retirement account.
Vanguard’s indexed ETFs in a corporate brokerage account – this is not tax deferred.
Less than 7% of investment capital is “play money”. Actively managing junk debt and penny stocks in mining, oil and gas juniors and other smallcap ventures. If nothing else – it reinforces the fact that “beating the market” on a consistent and sustained basis is not attainable………………… This is like a trip to Atlantic City or Vegas – lots of fun.-
Beating the market is doable if you are working with under $1 million. Even buffett said he could get 50% return yearly under $1 million. The problem is the larger amounts. You are limited in what you can do the larger the amount.
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Quote from macrophallus
Beating the market is doable if you are working with under $1 million. Even buffett said he could get 50% return yearly under $1 million. The problem is the larger amounts. You are limited in what you can do the larger the amount.
A lot of people have this problem. I always invest well under $1M & so far I haven’t been doing too badly.
Lucky me that I’m not rich, the returns are better.-
Quote from Frumious
Quote from macrophallus
Beating the market is doable if you are working with under $1 million. Even buffett said he could get 50% return yearly under $1 million. The problem is the larger amounts. You are limited in what you can do the larger the amount.
A lot of people have this problem. I always invest well under $1M & so far I haven’t been doing too badly.
Lucky me that I’m not rich, the returns are better.
Not attainable. If you average 12% long run and outperform the market (even with a smaller portfolio) for a couple of decades you are in the top 1% + of all investors.
The reality of average retail investors who set these kinds of goals is that they take risk inappropriate to return in attemt to hit a home run. They buy “long shots” and trade too often and, in the end usually have returns that underperform the index investor.
For those young radiologists reading this: Don’t try to beat the market. It’s a fool’s errand. -
You can consistently beat the market by buying and holding stocks with a consistent long term history of raising their dividends annually and reinvesting the dividends
It’s not fancy
It doesn’t make you rich overnight
It’s not glamorous
Most of the stocks you own never get mentioned in the lightening round
You won’t be the ” in the know” guy at dinner parties
It just works and had worked for years
Reinvesting the dividends and rising dividends yearly is the key
It’s a long term strategy that is proven and works
Most people don’t do it because it is long term and they have no patience
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[link=http://www.ifa.com/articles/portfolios_individual_dividend-paying_stocks]http://www.ifa.com/articl…dividend-paying_stocks[/link]
Compared to globally diversified portfolios of index funds tilted towards small cap and value stocks (the IFA Index Portfolios), this fund held its own for the five and ten year periods. Unfortunately, these periods are too short to draw any definitive conclusions from. When we go the twenty year period, VDIGX underperformed an IFA Index Portfolio of the same risk by about 1% per year. While this may not seem like much, the impact on the growth of wealth over such a long period can be substantial. [b][b]Specifically, while $1 million would have grown to $4.3 million with VDIGX, it would have grown to $5.2 million with Index Portfolio 72[/b].[/b] Please note that we are not claiming that the twenty year period is statistically significant.
When we dig a little bit deeper into the holdings of VDIGX, we see that it is overweight in consumer staples and pharmaceuticals. While there is nothing wrong with owning those companies, investors should expect that there will be time periods when being overweight in those sectors will cause them to lag the overall market.
To summarize, while owning a portfolio of dividend-paying stocks can provide the psychological satisfaction of an income that is expected to increase over time, it is not an optimal way to capture the long-term returns offered by various risk dimensions of the market.
I think it is a common (but incorrect) thought that a dividend growth strategy is a long term outperform on the S&P 500.
The above article explains why pretty well.
I do VDIGX as a major holding in my portfolio, but it is just one holding for diversification, not meant to outperform the market. -
Couple points Dergon
1. Return from any mutual fund in my opinion is never to be believed. What they don’t tell you is their fees often hidden which reduces dramatically long term gains in your pocket
2. Important point is to invest in companies that have long term history of INCREASING dividends and REINVESTING. Over time your initial investment grows exponentially
IMHO increasing the dividend yearly and reinvesting everything is the key
It’s worked for me
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Both strategies are good. Warren Buffet is a proponent of the index fund strategy. The dividend growing strategy is probably better from a return point of view, but is less diversified.
I like the Vanguard VOO S&P fund because it has the lowest overheaad cost. If I had followed this strategy, I would have been much further ahead. Lessons learned by the school of hard knocks… Yet, I still cant resist gambling with 30% of the portfolio with the high flyers. Live by the sword and die by the sword. It is akin to chasing beautiful women. -
Quote from kpack123
Couple points Dergon
1. Return from any mutual fund in my opinion is never to be believed. What they don’t tell you is their fees often hidden which reduces dramatically long term gains in your pocket
2. Important point is to invest in companies that have long term history of INCREASING dividends and REINVESTING. Over time your initial investment grows exponentially
IMHO increasing the dividend yearly and reinvesting everything is the key
It’s worked for me
The report I linked presumed reinvestment. The issue is that dividends generally come at the expense of growth. The company while profitable is giving you the profits now rather then investing in the future, leaving their longer term growth statistically likely to underperform.
Also, your point is well taken on mutual funds and hidden fees. VDIGX has an ER of only 0.29%. Like other Vanguard funds it is very low cost.
Quote from aldadoc
Both strategies are good.
I guess I kind of agree. Could certainly do worse. -
My opinion only
Companies with a long 10 plus years of increasing dividends is the key. Lets face it in bull markets everyone makes money and it is not extremely hard to pick winners.
Where you really make money long term by dividend aristrocrats is in down markets, because they are increasing their payouts and you are buying the shares cheaper.
Mo money buying at lower prices.
Also My opinion only
You don’t need to be real smart to use this successfully. I am a perfect example. These companies will not triple in a year but you will also not lose your shirt in a bear market.
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Quote from dergon
For those young radiologists reading this: Don’t try to beat the market. It’s a fool’s errand.
+1 – it’s a zero sum game folks!
For every buyer there is a seller, and it is NOT POSSIBLE to beat the market on a consistent and sustained basis.
Every now and again you can pull off a collared hedge or an interesting trade – but these opportunities are few and far between.
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Quote from adopted canuck
Quote from macrophallus
I am fine with earning market returns using index funds. As a high income rad, there is no reason to take on excessive risk other than greed. Remember, as your ability to take risk increases, your need to decreases.
+1 – I am with the big guy – capital preservation is the key!
15% per annum is not realistic. This target shows a level of naivety that may prove a little costly. Active management and market timing – two concepts that the original poster eludes to – do not work.
15% compounded means a doubling of your initial investment in less than 5 years. Whereas you may achieve this through Loan Sharking, prostitution or Cooking Meth – your state medical licensing authority may frown upon these activities ……
Wow adapted canuck your last statement is pretty funny, but not as funny as the Canucks never winning the Stanley Cup.
Since 2012 most of my stocks have or are in Apple, GE, Qualcomm. So I am happy with their performance. Maybe you don’t have to do much managing of your portfolio, because you can pay someone for it, but if you don’t know understand or do any managing yourself it probably will show in your returns.
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Quote from kpack123
Apple can’t continue to grow at their prior pace
Well, certainly not “forever”, but they can do so for a few more years, and it’s virtually a no-brainer that they’ll easily hit 15% per year for at least 5-10 years if not longer.
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Quote from kpack123
Good companies but Microsoft and intel from 2000-2010 really did little
yes MSFT did little, I would maintain as a direct result of the govt interfering with their business (donning flameproof suit).
see below.
… OK so I won’t upload the graphs, due to the failure of the AM attachment pgm. (won’t even support jpeg now.)
however, it shows exponential growth until Nov 1999, when MSFT lost the antitrust suit to the govt, and they said they intended to break it up. Then, it briefly went to a high of 58, before crashing to 21. It rebounded to 34 in may of 2001 and today it is 32.01
from wikipedia
The late Nobel economist [link=http://en.wikipedia.org/wiki/Milton_Friedman]Milton Friedman[/link] believed that the antitrust case against Microsoft set a dangerous precedent that foreshadowed increasing government regulation of what was formerly an industry that was relatively free of government intrusion and that future technological progress in the industry will be impeded as a result.[link=http://en.wikipedia.org/wiki/United_States_v._Microsoft#cite_note-25][26][/link][/sup]
[link=http://en.wikipedia.org/wiki/Jean-Louis_Gass%C3%A9e]Jean-Louis Gassée[/link], CEO of [link=http://en.wikipedia.org/wiki/Be_Inc.]Be Inc.[/link], claimed Microsoft was not really making any money from Internet Explorer, and its incorporation with the operating system was due to consumer expectation to have a browser packaged with the operating system. For example, [link=http://en.wikipedia.org/wiki/BeOS]BeOS[/link] comes packaged with its web browser, [link=http://en.wikipedia.org/wiki/NetPositive]NetPositive[/link]. Instead, he argued, Microsoft’s true anticompetitive clout was in the rebates it offered to OEMs preventing other operating systems from getting a foothold in the market.[link=http://en.wikipedia.org/wiki/United_States_v._Microsoft#cite_note-26][[color=”#0645ad”]27[/color]][/link][/sup]
So the govt has now sued Apple. The mediocre minds in govt can’t stand success, it seems.
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Quote from Phil Shaffer
So the govt has now sued Apple. The mediocre minds in govt can’t stand success, it seems.
I suppose another way to look at it is the grandiose measures taken by behemoth companies can stray so far out of control that the government must step in and impose regulations to protect the consumer from rampant exploitation.
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At some point company’s mature and markets get tapped out. That’s when the stock price stagnates for long periods of time
I bought Intel Microsoft and oracle in the mid 90’s when everybody said you had the own them
I didn’t lose anything, but didn’t really make anything for years until they started upping their dividend
In my experience, I just never make much off of these high growth companies whenever everyone feels they have to own them.
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Apple probably still has legs. $110Billion in cash. Forward PE ratio of 10. That is insanely low for a growth company. Microsoft had a PE ratio of 50 when they went flat.
Apple extended their market from a US centric market to the whole world. New product cycle for the iPhone 5 should have huge sales. After that, I don’t know. But they seem like a good bet for at least another year.-
I don’t own Apple stock right now, but I am still considering buying some. May might be the month I sit out from buying any stocks. I will continue to invest in my Roth IRA and 403. When the market dips I usually invest more in my retirement accounts. This has worked out for me fairly well. I also might look to develop a iphone app. I have family that can write the code and I believe I have an idea that might be lucky enough to sell. I know the main key would be my marketing strategy.
[:)]-
Good luck in your endeavor. Remember that Both Lynch and Buffett are the outliers. There are many more that lost than made money like they did. Even Lynch syas that it isn’t possible to do what he did back then today. Too many computers playing the market. If you think that you can realistically make 15% a year on an ongoing basis get out of medicine becasue you will doing better than 99% of financial advisors or fund managers.
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Sounds like prudent investment strategy. According to Reuters it looks like the market will be hitting it’s highest point in 4 years today.
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In response to Kpack123 I will not sell right away. To dergon I am getting closer to 15% and I have a goal for my individual stock account to keep it somewhat short term to save for a down payment on a house in about 4 years.
Apple has been doing very well for me. If I don’t average 15% I won’t be devastated. I will still be happy because I will be way ahead of the national savings rate.-
Well…. the most likely you’re getting 15% for the year is …… the market is up 15% for the year 😉
My US based indexes and large caps are looking great. My international/emergings are a not as pretty a picture.-
I find it interesting that the homebuilders are knocking it out of the park. Maybe a turn around. Anecdotally, I know someone who is building a house. As soon as they bought their lot the rest of the lots sold and all of them have builders. Most of them I think are sold by the builders too.
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Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
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While I wouldn’t sell all equities I would certainly sell some
In fact I have been accumulating cas for a month now because I expect a pull back of about 8-12 percent before Nov
When it pulls back I’ll by my favorites cheaper
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this is usually the time to buy gun stocks. As I recall companies like Winchester, smith & wesson were up huge on Obama being elected.
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Based on the fact that the market has consistently been going up since the day Obama took office, I would imagine that the market will frown if there’s a perception that Romney is gaining favor with the populous.
For now, it seems that the market still sees Obama as the candidate of choice. Whether they’re going by the modeling done by groups like [link]http://www.fivethirtyeight.com[/link] is anyone’s guess.
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Most people who try their hand at market timing miss the respective bottoms and tops they are trying to time and get worse-than-market performance.
I figure for the average guy that’s 20 years long in the market anything that happens in the coming 18 months is no more than a blip. Just keep on watching you costs and dollar cost averaging.
Don’t let the daily news change your strategy……so sayeth Jack Bogle-
Quote from dergon
Most people who try their hand at market timing miss the respective bottoms and tops they are trying to time and get worse-than-market performance.
I figure for the average guy that’s 20 years long in the market anything that happens in the coming 18 months is no more than a blip. Just keep on watching you costs and dollar cost averaging.
Don’t let the daily news change your strategy……so sayeth Jack Bogle
I agree with your sentiment about going long, but I don’t subscribe to dollar cost averaging (DCA). While it does minimize the chances for a loss, it also happens to equally minimize the chance for a gain. And so by definition, long-term DCA only lets you break even. Instead of DCA, you need to find an edge, like an industry you know has a lot of growth potential for decades to come, and then take a plunge and hold it long. Cloud technology, senior care, geriatric medicine, developing nations, that kind of thing. You just need a sense of a niche industry that is positioned to solve a huge burden on society far into the future.
In medicine, new high-growth-potential markets are not all that hard to find. A visit to RSNA can often reveal a few prospects for high growth each year.
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Precious metals seems to be hot right now
I might have to look at that sector too.-
Random Walk Down Wall St.
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Quote from aldadoc
Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
Do you do this just on a hunch or are there some fixed numbers you look at to make your determination?
This is where I really struggle….and why I tend to not move and just stay long. Since that post in early september the S&P has moved up from around 1430 to around 1460. The pull back might still come soon ……there’s always a correction coming at *some* point. But that’s 2-3% return missed over the course of the last month. That’s 20% of the total S& annual return for the year there. And the Fed still seems hell bent to force us into equities keeping rates low…now until 2015.-
I have been doing it for the last 2 years
I have done it 4 times. Each time bought 1000 shares under 30 once as low as 28 and sell over 35, I think the highest I ever sold it was 37
I set aside a certain amount of money I play with and do some short term stuff, not close to day trading just market trending I call it
I like to get familiar with a handful of stocks which are solid companies that I doubt will ever collapse and buy on their dips and sell when the get at or above their normal trading range. I don’t have the balls of a gambler so I like to at least feel a little warm and fuzzy inside when I do short term stuff.
If you look at stocks over the past 2 or so years most have really been in a trading range, so How I look at it you either buy dividend players and hold and reinvest the dividends or you buy on dips and sell higher. I know what you are saying about buying and holding for the long term. I do that in my core portfolio for the most part but the time to really buy stocks is when their is a huge correction, Like When the tech bubble burst or like in 2001-2002 or in 2009. That is really where I have always made a killing-
you reference 09 but that was like a once in generation, if that, buying opportunity. The market was totally irrational and even good companies had broken stocks.
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2012 goes out as a pretty strong year. The S&P 500 up 15%.
I pretty much got the market returns in my own portfolio. Outperformed with the AAPL I bought in late 2011 (which I still hold). Underperformed with energy sector and international index buys.
I’m still 100% long and am at 0 cash with my last purchases of the year completed this morning.
Here’s hoping for a robust 2013!
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Apple is dead money for years
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Quote from kpack123
Apple is dead money for years
*shrugs* I bought AAPL to be many years long and am going to hold it. It’s only been 15 months so far.
I think there’s been a lot of bandwagon selling of AAPL lately. It still has a tantalizingly low P/E for tech and while yes, it is seeing competition eating at market share and margins it still has a shocking 30% average profit margin not to mention still tons of cash on hand.
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Its a great company
But so is Microsoft Intel Oracle IBM GE etc and many others.
Its explosive growth days are over and Its price will catch up to itself causing it to stagnate in a trading range for years probably at least a decade. The only money to made in apple in the next 10 years will be on the dips or in dividends.
Just watch. Its pretty dead money unless yoy time it and buy on the low trends while taking profits when it goes up. All great companies do this. You can’t grow astronomically for ever. Such a no brainer.-
Fun Stock Market fact of the day:
Did you know that all other previous bull makrets since 1929 have at least matched their previous all-time highs. That would mean about 10% yet to go on this already 4- year old run.
((ppinaiofr))
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Quote from kpack123
Apple is dead money for years
[link=http://9to5mac.com/2014/04/24/7-for-1-aapl-split-to-encourage-smaller-investors-may-also-open-entry-to-dow-jones-index/]http://9to5mac.com/2014/04/24/7-for-1-aapl-split-to-encourage-smaller-investors-may-also-open-entry-to-dow-jones-index/[/link]
A big beat on earnings and announcing a 7:1 stock split looking to be listed on the Dow. Valuation still crazy low (imho) at 12ish.
On Bloomberg today they talked about how much the AAPL dividend now is : “They give a Ford Motor Company back to their investors every year”. I said back then I was buy and hold long and was perfectly to happy to watch AAPL become a blue chip. Still am 🙂
Been holding since this discussion back in Summer of 2012. My individual holdings in AAPL account for only 0.70% of my portfolio. But a good day today.
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Naysayers & Doomsayers back into their hole licking wounds.
They’ll be back. Been the same since 1985.
Insanely Great.-
Still not a fan of Apple stock
Great company, I own all of their products and love them but I believe they are in a price range that they wil stay in give or take 20% for a decade
It’s a mature company, the rate of growth can’t keep up with a rising stock price
The 7-1 stock split will push the price up for a short time because people who were afraid of the high price can now feel safer but IMHO Apple aside from the dividend is dead money
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Wait a few weeks sell it then buy some back at the end of summer when it drops 15-20%
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I’ve owned Apple on and off. It is a good, solid dividend paying stock, but it is no longer considered a growth stock. With a PE of 12 or 13 it is probably a bit undervalued. In that category, I also like Boeing. If you want growth, with the associated much higher risk, then I would look at Gilead pharmaceuticals, Biogen, Facebook or Tesla motors. Google is probably in for a slowdown. Amazon and Netflix are probably also fully priced.
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Every single time Apple has split, the stock pumps up substantially for quite some time. One thing Cook knows how to do is manage investment strategies.
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Glad the Dividends are going up along with the 7-1 split. Some of my dividends will now go back into buying more shares.
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It’s pretty much been dead money for 2 years. I anticipate the trend to continue, might be a good one to buy on dips sell on peaks
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Quote from aldadoc
Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
Well…. back in September the dump of AAPL certainly saved you some $$. But did you get back in or are you on the sidelines? There’s been some volatility but looking good from Sept. ’12 to now.
[link=http://www.bloomberg.com/news/2013-01-18/u-s-stock-futures-little-changed-before-earnings-data.html]http://www.bloomberg.com/news/2013-01-18/u-s-stock-futures-little-changed-before-earnings-data.html[/link]
U.S. stocks rose, sending the [link=http://topics.bloomberg.com/dow-jones-industrial-average/]Dow Jones Industrial Average[/link] to a five year-high, as House Republicans plan to vote next week on a temporary increase in the debt-limit and investors watched corporate earnings.
Nine out of [link=http://www.auntminnie.com/quote/SPXL1:IND]10 groups[/link] in the [link=http://www.bloomberg.com/quote/SPX:IND]S&P 500 (SPX)[/link] rose today as industrial shares had the biggest gain. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the [link=http://topics.bloomberg.com/s%26p-500/]S&P 500[/link], fell 8.2 percent to 12.46, the lowest level since April 2007.
The S&P 500 is 5.1 percent below its all-time high of 1,565.15 set in October 2007. The Dow is less than 4 percent away from hitting its record of 14,164.53. About 72 percent of the 67 S&P 500 companies which have reported quarterly results beat analysts forecasts. Fourth-quarter earnings grew 3.8 percent, according to analysts estimates compiled by Bloomberg. At the end of last week, they forecast 2.5 percent growth.-
I sold some stuff in September as well due to the uncertainty I wanted to lock in some gains. Still Holding on to the cash for now waiting for a nice pull back. Give or take a percent the only thing I lost was a little volatility. I’ll probably go back into little cash sometime between feb-and May 1st. There is still some uncertainty coming up soon.
I still wouldn’t by Apple though. It is a mature company now. Look at the charts for the GE,s Microsofts intels and IBM after they became a mature company. They tread water for years. Better off buying a nicve company that grows their dividend. Less bumpy and you’ll be ahead in the long run.-
I don’t think Apple has the ‘gotta have it’ product anymore which will weigh on the stock price.
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Quote from aldadoc
Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
you mean you don’t have already have all your money in gold waiting for the inevitable devaluation of the dollar and 5,000% inflation because of Obama’s policies?-
Quote from Adeelmd
Quote from aldadoc
Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
you mean you don’t have already have all your money in gold waiting for the inevitable devaluation of the dollar and 5,000% inflation because of Obama’s policies?
Quote from aldadoc
It may be time to get back into equities … carefully. I think that the banks have largely de-leveraged after the large recent settlements. The home building industry, should have some pent up demand, after 5 years of stagnation and almost no lending. So these are areas that I will look at. I don’t expect corporate profits to see much growth this year, because of the severe tax and regulatory environment, but if the inflationary effects of a devalued currency hit, the equity markets are a better hedge that money sitting on the sidelines. So yes, I plan to get back in sometime after the flows of pension fund moneys ease and the markets retreat in Feb or March.
Alda answered with that quote above part in January of 2013… but I didn’t see any reply after that. The biggest “retreat” the S&P 500 saw this year was maybe 6-7% in June/July. Other than that is was pretty much “up”. Corporate profits remained at some of the highest levels of the post-WWII era. People with cash sitting on the sidelines waiting a full correction so they could jump back in on the cheap were extremely disappointed in 2013. Many conservatives who let their politics influence their portfolio jumped waaayyy too hard into commodities coming out of the Great Recession and were so ready to believe in the “End of America” that they couldn’t even consider equities.
Alda jumped out in September 2012 at the height of conservative media’s “OMG! Obama might have a second term which will totally destroy America and mean a market crash! Regulations will crush corporate America and hyperinflation will run amok! Buy guns now!” spin.
Hopefully he got back in at some point because if he didn’t he missed a good 30% return.
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Fun to go back to page 1 of this thread too.
AAPL a waste of money and “can’t grow forever” in 2012.
(April 2012 AAPL opened at around $21 …. It’s now > $130)-
And split. After 7:1 recently.
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Quote from dergon
Fun to go back to page 1 of this thread too.
AAPL a waste of money and “can’t grow forever” in 2012.
(April 2012 AAPL opened at around $21 …. It’s now > $130)
Apple rocks. I’m hoping AAPL someday gets me a nice retirement in Pinehurst.
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To that I would answer that there is no free lunch.
Predicting higher than average growth by definition comes with higher than average risk. THe average guy can’t swim in the same pool as the few big boys who really know it….so why try.-
Quote from dergon
To that I would answer that there is no free lunch.
Predicting higher than average growth by definition comes with higher than average risk. THe average guy can’t swim in the same pool as the few big boys who really know it….so why try.
You’re absolutely correct about there being risk no matter what and that the “average guy” is at a disadvantage. But we aren’t “average guys”. We have highly skilled knowledge about a particular industry sector (medical technology).
Choosing a stock is like riding a bike in a busy metropolis. There’s always a chance you could get hit by a car or run down a pedestrian. But the more you understand the traffic flow and pedestrian patterns in a specific neighborhood, the easier it is to “minimize the risk” and navigate your bike through the streets of that neighborhood without incident. True, the “average guy” (ie, an outsider) might get himself killed within the first 30 seconds if he’s not knowledgeable about the flow in some neighborhoods. But when you consider intimate knowledge of a “neighborhood” as being analogous to a specific “industry sector” and an understanding of what the industry promises in terms of solving problems into the future, then it’s not that tough to spot the winners.
Was it really that hard to see Facebook’s flop a mile away? Or the failure of Stand-Up MRI? Was it hard to see that Apple would rule the world when it introduced the iPhone or iPad, especially after knowing the lessons it learned about IP when it got burned by their stupid deal with Microsoft back in the ’80s? None of that required insider knowledge. It just required an intimate knowledge of the ‘hood.
Likewise, you could count the number of people on one hand who didn’t think MRI would take off, CT/PET/SPECT, or digital mammography, or PACS/RIS technology. Or Disney, for that matter (once it bought Pixar). You just need to understand how each sector fulfills its need in society, and then riding the bike through that neighborhood isn’t really all that tough.
Anyway, you don’t have to be a [i]big[/i] investor. You just need to do your homework as a [i]smart[/i] investor. You stand a far better chance understanding the industry than just basing our purchase on the technicals. A strong P/E won’t get you nearly as far as strong IP with a vision.
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Just found out from my brother that he owned a small amount of shares of Apple which he bought for 10$ per share way back in the 90’s. I only wish I did that and not bought so much Disney stock. Instead of investing in Disney and a few other stocks I could have bought 1000 shares of Apple. The reality is I didn’t and as for my brother he sold his shares a few years ago when he really needed some extra cash. I have not been able to invest more money into my accounts lately because I have been spending money on my 3 week vacation and I have some car repairs. Looking forward to buying more shares soon. I will still fully fund my 403b and I will try to contribute to my Roth more this year. Overall I am doing fairly well and I have been blessed with some overtime at work. Praise God.
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I don’t want to come off as overly rigid or formulaic on my investing plans either. I’ll do some pseudo-DCA, letting cash build up from my salary earnings and “buy the dips”
Last year I rode out the summer without putting in new cash…..until Steve jobs died. When Apple took that 5% or or so dip with his his death I decided to jump back in.
I bought 100k worth of 3 things – AAPL, then balanced it with A Vanguard Energy Fund ( for some reason I am drawn to energy stocks), and a Vanguard world emerging fund.
Of those AAPL is up 76% since (with a dividend), VDE +21% and VWO 5%, only getting into the black for the year a few weeks ago. *Most* of my timing was pretty good……except that I thought the world economy was ready to bounce back Q4 2011……..it wasn’t 😉
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Dergon,
100k 2 invest very nice.-
Thank you.
I save (invest) 50% of my post tax pay.
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Back on April 28 in post #5 of this discussion I recommended Apple. It was $580 at the time. It has since gone up to $700 which is an increase of 20% in just over 4 months.
[link=http://www.auntminnie.com/Forum/tm.aspx?high=&m=346381&mpage=1#346403]http://www.auntminnie.com…381&mpage=1#346403[/link]
That should allow the OP to get achieve the 15% annual goal for at least 3 more years and most likely longer. Apple will be first to exploit cloud technologist for the mass market and will engulf the populous in a point-of-no-return dependence on that technologist within the Apple architecture. While you might dread the predictions of Apple turning into a Microsoft culture of information lemmings, you won’t regret the profits if you invest now and go long.
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15% continued returns by individual investor likely unrealistic.
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Quote from MSK/SW
15% continued returns by individual investor likely unrealistic.
Depends on whether you really know how to pick ’em.
Also depends on what you mean by “continued”. -
You must like a Bear market. Be carfeful if you are shorting
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Quote from irayd8u
Be carfeful if you are shorting
Agreed. “Shorting” means “derivatives”, and that stinks of Greenspan.
Steer very clear of ANTYTHING that smells like that skunk.
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If you invest for a while you are bound to get burned at some point. The key is learning from it and trying not to repeat the mistake.
I have never made much buying stocks near or at their all time high. Maybe it’s just me or my luck but over the years I’ve done the best when I bought when the markets were down and everyone was selling
For those of you buying Apple now go back and look at history all great companies mature and stagnate for a long period of time Microsoft intel GE IBM and the list goes on and on and on
I have heard all the cant miss arguments before
If you are holding apple now and have profits at least pick a number and put a stop on it at some price because one day likely in the near future the fabulous growth will stop and it will Peter around a trading range for years
Best investment advice I ever got was buy low sell high
A lot of stuff is high right now
Not much is cheap
Aside from my core long term holdings I am on the sidelines until their is a correction
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kpack123
You forget that you can sell after making some profit. I also did not buy at the all time highs. I have made mistakes before as I am sure others have, but have learned from them. I also have said that I am looking for this investment as a short term. My long term investments should help me to get to around 2 million when I retire. I am 1/6 of the way there already and that is all buy myself with one income as a R.T.-
Sounds like you got it figured out what works for you. Good luck with that apple.
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I know it feels like a big run we’ve been on and just feels “due” for a correction……probably is.
But lots of US sectors are still sitting with low 10s for P/E. Total S&P is like 14.8 P/E, a good bit lowere than historical average and a lot lower than the 2007 top.
You don’t have to buy AAPL but for tech it is still trading at a cheap P/E.
I kind of looking for a “omg fiscal cliff, election gridlock” pullback as a chance to load up with current cash.
Wife wants to buy some physical gold which I’ve never done before.
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Quote from aldadoc
Sold out of all equities today. Even my favorite, Apple. Things just seem to be too unstable and artificially propped up by the central banks. Going Galt to the sidelines for a while.
Trader’s Golden Rule: Don’t fight the fed.
You’re hearing the word “unlimited” being tossed out with some frequency by both US federal reserve and the ECB.-
Just sold some non retirement mutual fund shares on Friday. I will decide on some individual stocks to buy the beginning of this week. I made my decision because the fund was more of a long term growth and I already have that investment class in my retirement accounts. My individual stocks are more short term and they have been performing pretty well. I have a few ideas but will do a little more research. I will consider buying more Apple stock, but I want to have a few other sectors also.
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Basically all academic research ever has shown that nobody can consistently outperform the markets yet everyone seems to still think they can – I don’t get this.
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Short term I am doing very, very well. I don’t care that there are some of you out there with negative comments. Some of you maybe have been burned by the market, and others maybe don’t do that much research. I also think a lot of the feedback are from Radiologists who tend to have very good salaries and don’t have to rely that much on their investments. I continue to say that my goal is 15% for this year and the year is almost up and I am right on track to make my goal and maybe even exceed my goal. I will not be disapointed if my goal is not met and I only make around 10% at least it is way better than a savings account or CD. I started to invest in the stock market in April and I did not invest in Apple stock until July for 598 per share. I could be doing a lot better if I had purchased Apple in April.
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My advice is to not do whatever the radiologists that have to work past 65 did.
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Quote from **Prodi8noChainsaw
My advice is to not do whatever the radiologists that have to work past 65 did.
Get divorced?
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Energy sector took it on the chin last week. I’m currently thinking long on energy….maybe Apache.-
Or How about enrgy services? Halliburton etc… or a fund that combines servicers
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Quote from DICOM_Dan
Halliburton etc… or a fund that combines servicers
I know I should be able to cleanly separate my political life from my investing life…..but I just couldn’t bring myself to buy Halliburton. (even though I own it through my holdings in VDE where it’s about 3% of the fund)
An energy servicers fund though ………… interesting-
My reasoning is someting along the line that there will be money made in servicing equipment and getting the resources out of the ground. Drill baby drill or something like that. FSESX Fidelity Select Energy Services is one such fund.
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Ended up just being boring…..another buy of a split of VDAIX and VDE
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Halliburton
Buy under 30 sell over 36
Easy way to make quick bucks
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What about 2001
Even 1998
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It may be time to get back into equities … carefully. I think that the banks have largely de-leveraged after the large recent settlements. The home building industry, should have some pent up demand, after 5 years of stagnation and almost no lending. So these are areas that I will look at. I don’t expect corporate profits to see much growth this year, because of the severe tax and regulatory environment, but if the inflationary effects of a devalued currency hit, the equity markets are a better hedge that money sitting on the sidelines. So yes, I plan to get back in sometime after the flows of pension fund moneys ease and the markets retreat in Feb or March.
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Well……. DOw at 14000… for now.
I became debt free in late 2007 and that was the point where I really started plowing money into the market. It was a painful ride down putting in 50% of my pay every month as the market tanked. But now, 5 years later buying at those lows feels OK.
As for the last few months —- 1% of my portfolio is down 30+% (AAPL), but the rest of it is looking good!
If we can just keep this up my plan of half-time at age 50 might actually come to pass!-
Italian political deadlock + Sequester –
maybe now is the time for a real market pull back after this big run.-
The Italians are at it again, France is in the tank, Spain ang Greece not much better. Sequester is not a big deal, but we are going to be in recession again soon, regardless. My guess is that we are going to have a pullback between now and the spring. Housing and energy may be the two bright spots. Here’s my calculus, [b]fully realizing that I could be wrong[/b]:
Buy gold as a hedge against the currency devaluation wars and a hedge against the upcomming downgrade of our credit rating
Buy energy and banks on a pullback.
Short Google.
Buy back Apple -Too beaten down. Rumors that it may split or increase dividend.
Buy Boeing.-
My guess Pull Back which may have already started takes down between 13300 and 13000
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I like BAC INTC and PFE
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Quote from kpack123
My guess Pull Back which may have already started takes down between 13300 and 13000
Yeah …….. 5-8% in that range. I’m already prety much 100% in the market with no cash to put in, but if I *did* have a pile of cash, I’d say low 13000s would be a nice buy.
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Dow might pass all-time high today. Was reading an interting piece on how little that matters at all:
You may not realize this, but the Dow Jones Industrial Average, the Dow that everyone quotes as representative of the US stock market, and sometimes even a barometer of the US economy, is a mathematical farce.
[link=http://money.cnn.com/data/dow30/]Just thirty stocks[/link], hand picked by committee by Dow Jones, with no rigorous requirements. Worse, its a price-weighted index, which is mathematically nonsensical. When calculating the Dow Jones Industrial Average, they take the actual stock prices of each stock, add them together, and divide them by a [link=http://en.wikipedia.org/wiki/DJIA_divisor]Dow Divisor[/link]. They dont take into account how many shares outstanding; they dont assess the market capitalization of each company. When a stock splits, they actually change the divisor for the whole index. Its completely unclear what this index is designed to measure, other than financial illiteracy.
In fact, there is only one justification for the Dow Jones Industrial Average being calculated this way. Dow Jones explains it in this post on [link=http://blog.djindexes.com/index.php/why-aapl-and-goog-arent-in-the-dow/]why Apple & Google are not included in the index[/link]. To save you some time, Ill summarize: they have always done it this way, and if they change it, then they wont be able to compare todays nonsensical index to the nonsensical index from the last 100+ years.
[link=http://blog.adamnash.com/2012/02/13/apple-cisco-dow-15000/]http://blog.adamnash.com/2012/02/13/apple-cisco-dow-15000/[/link]-
The DJIA is a bullcrap number that largely measures inflation. The market has been essentially FLAT since the crash, so much for BHO’s “recovery”
[image]http://pricedingold.com/charts/DJIA-2006.png[/image]-
Bill, you will ALWAYS find some way to call any data “bullcrap” it it’s at all possible for you to scramble up some pigeon crap that better supports your hallucinations about the world around you.
Big deal.
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The difference is, when I call “bullcrap” I back it up with real data. I’ve posted more graphs data and links on this board than anyone else. Wheres yours?
[link=http://www.usatoday.com/story/opinion/2013/03/04/federal-reserve–quantitative-easing/1963539/]http://www.usatoday.com/s…tative-easing/1963539/[/link]
The USA today, hardly a right wing publication, agrees with me!-
Quote from billainsworth
I’ve posted more graphs data and links on this board than anyone else. Wheres yours?
The USA today, hardly a right wing publication, agrees with me!The graphs you post may represent data, but none of it supports the point you are trying to make. You ALWAYS misinterpreted every graph you’ve ever posted here. Don’t fool yourself.
And USA Today is indeed a rightwing paper. You are out of your mind. It is owned by Gannett and was founded by Al Neuharth, of extreme right wing notoriety.
Ground Control to Major Bill, your circuit’s dead…again.
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