collapse

* Recent Posts

Kam Jones 1st Round Mock - The Ringer by The Lens
[Today at 07:48:49 AM]


10 years after “Done Deal” … It’s Happening! by Goose
[Today at 07:14:37 AM]


Big East 23-24 NCAA and NIT Results by 1SE
[Today at 06:38:02 AM]


NCstate fan scouts Marquette by brewcity77
[Today at 06:05:33 AM]


Katz has MU in Final Four by Uncle Rico
[Today at 05:59:46 AM]


UNLEASH THE POWER OF SCOOP!!! by Jay Bee
[Today at 05:13:02 AM]


Three Years Ago Today... by Newsdreams
[March 27, 2024, 11:34:10 PM]

Please Register - It's FREE!

The absolute only thing required for this FREE registration is a valid e-mail address.  We keep all your information confidential and will NEVER give or sell it to anyone else.
Login to get rid of this box (and ads) , or register NOW!


Author Topic: Investing Thread  (Read 287159 times)

Hards Alumni

  • All American
  • *****
  • Posts: 6583
Re: Investing Thread
« Reply #1575 on: December 03, 2021, 04:15:10 PM »
Market less than 5% off of all time highs.  FRIDAY BLOODY FRIDAY

Yeah, it was tongue in cheek :)

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1576 on: December 03, 2021, 04:22:11 PM »
Market less than 5% off of all time highs.  FRIDAY BLOODY FRIDAY

Yeah, it's funny to hear people proclaiming the end of the world when there's a volatile week with a lot of big names down.

Rough time especially for more speculative names that have no earnings, the types of "disruptive" stocks that were all the rage at the start of the year.
“It’s not how white men fight.” - Tucker Carlson

JWags85

  • All American
  • *****
  • Posts: 2978
Re: Investing Thread
« Reply #1577 on: December 03, 2021, 04:30:26 PM »
Yeah, it was tongue in cheek :)

Haha it was less about you and everyone for the last few years who scream to buy every dip...when they aren't really dips

Skatastrophy

  • All American
  • *****
  • Posts: 5516
  • ✅ Verified Member
Re: Investing Thread
« Reply #1578 on: December 03, 2021, 04:31:20 PM »
Haha it was less about you and everyone for the last few years who scream to buy every dip...when they aren't really dips

Growth stocks off ~25% is a notable past couple of weeks. My watch list of EXFY, NET, SOFI, and NRDS are all on discount. DOCN available at a discount as well.

Strong sector rotation with a flight from growth to safety.

I'm honestly not good at timing dips. I always buy too early, and honestly don't keep much cash on hand to take advantage of this sort of movement.

Yeah, it's funny to hear people proclaiming the end of the world when there's a volatile week with a lot of big names down.

Rough time especially for more speculative names that have no earnings, the types of "disruptive" stocks that were all the rage at the start of the year.

Not profitable is not the same as unable to be profitable. I'd prefer a company that is using their revenue on growth/innovation over a company paying a dividend because they're out of ideas.

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1579 on: December 03, 2021, 06:16:48 PM »
Not profitable is not the same as unable to be profitable. I'd prefer a company that is using their revenue on growth/innovation over a company paying a dividend because they're out of ideas.

Re your first sentence, I agree.

Re your second, I like companies that can do both, and many can. I'm not talking about those with high yields. I'm talking about, say, MSFT, HD, NEE, AAPL, LHX, LRCX, COST, etc. I do have some "boring" dividend-growers (the JNJs and PGs and PEPs of the world) but also have some non-dividend names (GOOGL, AMZN, FB). I also have a small, speculative bucket ... and most of those have gotten blitzed recently. My NIO position, for example, is about 30% underwater. My DKNG, one of my biggest "winners" a couple months ago, is now one of my biggest "losers." Thankfully, as I said, those make up only a very small percentage of our portfolio.

I have a feeling I'm also at a different stage of my investing journey than you are. In 2-4 years, my wife and I will be starting to live off our dividends and capital gains (in addition to SS and pensions).
“It’s not how white men fight.” - Tucker Carlson

Skatastrophy

  • All American
  • *****
  • Posts: 5516
  • ✅ Verified Member
Re: Investing Thread
« Reply #1580 on: December 04, 2021, 10:54:25 AM »
Re your first sentence, I agree.

Re your second, I like companies that can do both, and many can. I'm not talking about those with high yields. I'm talking about, say, MSFT, HD, NEE, AAPL, LHX, LRCX, COST, etc. I do have some "boring" dividend-growers (the JNJs and PGs and PEPs of the world) but also have some non-dividend names (GOOGL, AMZN, FB). I also have a small, speculative bucket ... and most of those have gotten blitzed recently. My NIO position, for example, is about 30% underwater. My DKNG, one of my biggest "winners" a couple months ago, is now one of my biggest "losers." Thankfully, as I said, those make up only a very small percentage of our portfolio.

I have a feeling I'm also at a different stage of my investing journey than you are. In 2-4 years, my wife and I will be starting to live off our dividends and capital gains (in addition to SS and pensions).

We're in agreement, mostly. The majority of my investments are in index funds, it's just not that interesting to talk about lazy portfolios. I have my bucket of fun money in small-ish speculative bets similar to you. Psychologically it's very interesting because those speculative bets aren't a ton of money, but they occupy a lot of my investing-related thoughts. It keeps my grubby little mitts from messing with the majority of my portfolio.

My question for you: Why directly invest in companies over index mutual funds or etfs? Is that just the way you've been doing it for long enough that you don't want to realize your capital gains right now?

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1581 on: December 04, 2021, 05:04:11 PM »
We're in agreement, mostly. The majority of my investments are in index funds, it's just not that interesting to talk about lazy portfolios. I have my bucket of fun money in small-ish speculative bets similar to you. Psychologically it's very interesting because those speculative bets aren't a ton of money, but they occupy a lot of my investing-related thoughts. It keeps my grubby little mitts from messing with the majority of my portfolio.

My question for you: Why directly invest in companies over index mutual funds or etfs? Is that just the way you've been doing it for long enough that you don't want to realize your capital gains right now?

Legit question.

As the Great Recession raged on, and I saw our portfolio of index funds crash by 50-60% (as everybody else's did), I grew concerned that we might not make it to retirement with enough income to cover our needs and wants. I started reading about Dividend Growth Investing and it made sense to me -- invest in some of the strongest companies in the world, blue-chippers with excellent credit ratings that not only paid dividends but grew them annually at inflation-beating rates.

I gradually moved into individual stocks. I made plenty of mistakes early -- did some yield-chasing, etc -- but after a couple/few years ended up with my tweak of DGI, which included more growth and lower-yielders than a lot of others who use the strategy. That led me to the AMZNs, GOOGLs, AAPLs, MSFTs, etc, in addition to some of the "boring," medium-yielding consumer staples, utilities and others.

I never claim that the way I do things is superior to any other strategy, including the more traditional DGI or yours with mostly funds or growth/momentum or anything else. I'm not a fan of "my strategy is better than yours" people. What I do just works for me, gives me peace of mind. This past week, while some were freaking out, I was like, "OK, but TD, WEC, AMGN and MA just gave me some nice dividend hikes."

In addition to now having a portfolio worth more than I ever thought possible back in 2009, we have an income stream set up that will fund our needs and wants without ever having to sell stocks if we don't want to. It's a real comfort.

Thankfully, these last dozen years have been incredible for anybody in the market, whether one invests in individual stocks or index funds. Any investor who failed to kick butt these last dozen years should just go all cash and bury it under a rock in their backyards!

I wish you great fortune. Thanks for the conversation.
“It’s not how white men fight.” - Tucker Carlson

Skatastrophy

  • All American
  • *****
  • Posts: 5516
  • ✅ Verified Member
Re: Investing Thread
« Reply #1582 on: December 04, 2021, 06:00:04 PM »
Solid answer, thanks MU82. Best of luck with the transition from the accumulation phase to the distribution phase of investing. It's an interesting psychological hurdle, to be sure, after decades of focusing on making the numbers go up!

reinko

  • All American
  • *****
  • Posts: 2696
Re: Investing Thread
« Reply #1583 on: December 04, 2021, 06:37:45 PM »
Anyone have any experience in I bonds?  The partner and I do have access to cash (that is earning way to little and realistically losing value), and could max out, as they just raised their rates to 7%+.

Thanks

rocky_warrior

  • Global Moderator
  • All American
  • *****
  • Posts: 9002
Re: Investing Thread
« Reply #1584 on: December 04, 2021, 06:50:17 PM »
Anyone have any experience in I bonds?  The partner and I do have access to cash (that is earning way to little and realistically losing value), and could max out, as they just raised their rates to 7%+.

Thanks

Haven't really thought about them, but that's a fantastic long term rate.  Limited  to buying $10k/SSN/yr

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1585 on: December 04, 2021, 09:01:11 PM »
Anyone have any experience in I bonds?  The partner and I do have access to cash (that is earning way to little and realistically losing value), and could max out, as they just raised their rates to 7%+.

Thanks

I bought two $10K I-bonds (the limit), one for myself and one for my wife. Will buy two more early in 2022. It's really about the best safe investment out there. Very easy to set up an account.
“It’s not how white men fight.” - Tucker Carlson

TSmith34, Inc.

  • All American
  • *****
  • Posts: 5083
Re: Investing Thread
« Reply #1586 on: December 04, 2021, 09:35:51 PM »
I never claim that the way I do things is superior to any other strategy, including the more traditional DGI or yours with mostly funds or growth/momentum or anything else. I'm not a fan of "my strategy is better than yours" people. What I do just works for me, gives me peace of mind. This past week, while some were freaking out, I was like, "OK, but TD, WEC, AMGN and MA just gave me some nice dividend hikes."
Of the stuff I took a deep breath on and bought in March of 2020, AMGN has been the only one I've really been disappointed with. Yes, it is up marginally, but widely lagging the indexes.

I realize that you are probably looking at it for the dividend and any cap appreciation is gravy, and certainly I don't mind the $7.00+/share it is throwing off in dividends, but still disappointing to me.
If you think for one second that I am comparing the USA to China you have bumped your hard.

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1587 on: December 04, 2021, 09:42:46 PM »
Of the stuff I took a deep breath on and bought in March of 2020, AMGN has been the only one I've really been disappointed with. Yes, it is up marginally, but widely lagging the indexes.

I realize that you are probably looking at it for the dividend and any cap appreciation is gravy, and certainly I don't mind the $7.00+/share it is throwing off in dividends, but still disappointing to me.

Total return does matter to me, and AMGN has been a disappointment, yes.
“It’s not how white men fight.” - Tucker Carlson

MuggsyB

  • All American
  • *****
  • Posts: 12685
Re: Investing Thread
« Reply #1588 on: December 07, 2021, 08:42:08 AM »
I just read a really good article in the December addition of Commentary Magazine about the market.  It's from the guy who wrote Dow 36,000 years ago, James L. Glassman.  I would highly recommend it.  He wrote Dow 36,000 in 1999 and was pretty much ridiculed by everyone.  Whooops.

TSmith34, Inc.

  • All American
  • *****
  • Posts: 5083
Re: Investing Thread
« Reply #1589 on: December 07, 2021, 11:40:50 AM »
Keep in mind that he wrote in 1999 and said it would take 3-5 years to reach 36,000. It took ~22 years.
If you think for one second that I am comparing the USA to China you have bumped your hard.

Tortuga94

  • Walk-On
  • *
  • Posts: 16
Re: Investing Thread
« Reply #1590 on: December 07, 2021, 01:12:55 PM »
Haven't really thought about them, but that's a fantastic long term rate.  Limited  to buying $10k/SSN/yr

The only issue is that that is not a long-term rate. That is the rate they will pay for the next six months, started in November. The rate will renew to something else in May, all depends on CPI-U.
The interest is determined by adding the fixed rate (currently 0, but changes every six months) and the CPI-U rate (changes every six months too). Good news is that unlike TIPS, I bonds can never go below zero in a deflationary environment but can pay zero if CPI-U is negative and the fixed rate is zero or low where the CPI-U is negative more than the fixed rate that is being credited.
If you think inflation will continue to run high, maybe May's rate will be similar, if things start to cool off, you'll get a lower rate in May.
You also have to hold the bond for a minimum of 5 years too otherwise you forfeit some of the interest.

jficke13

  • All American
  • *****
  • Posts: 1358
Re: Investing Thread
« Reply #1591 on: December 07, 2021, 01:15:49 PM »
The only issue is that that is not a long-term rate. That is the rate they will pay for the next six months, started in November. The rate will renew to something else in May, all depends on CPI-U.
The interest is determined by adding the fixed rate (currently 0, but changes every six months) and the CPI-U rate (changes every six months too). Good news is that unlike TIPS, I bonds can never go below zero in a deflationary environment but can pay zero if CPI-U is negative and the fixed rate is zero or low where the CPI-U is negative more than the fixed rate that is being credited.
If you think inflation will continue to run high, maybe May's rate will be similar, if things start to cool off, you'll get a lower rate in May.
You also have to hold the bond for a minimum of 5 years too otherwise you forfeit some of the interest.

very helpful notes, thanks.

MuggsyB

  • All American
  • *****
  • Posts: 12685
Re: Investing Thread
« Reply #1592 on: December 07, 2021, 03:49:41 PM »
Keep in mind that he wrote in 1999 and said it would take 3-5 years to reach 36,000. It took ~22 years.

That's true, he said by 2005.  He briefly discusses where he went wrong with his initial prediction.  It's more the overall premise of the article which I think is pretty spot-on.

TSmith34, Inc.

  • All American
  • *****
  • Posts: 5083
Re: Investing Thread
« Reply #1593 on: December 07, 2021, 04:18:53 PM »
That's true, he said by 2005.  He briefly discusses where he went wrong with his initial prediction.  It's more the overall premise of the article which I think is pretty spot-on.

1. I find it weird that at the beginning of the article he does a victory dance for the Dow hitting 36,000 even though his prediction was seriously, seriously wrong.

2. His overall premise is "buy and hold over the long-term" from what I could glean, isn't it?
If you think for one second that I am comparing the USA to China you have bumped your hard.

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1594 on: December 07, 2021, 05:27:45 PM »
The only issue is that that is not a long-term rate. That is the rate they will pay for the next six months, started in November. The rate will renew to something else in May, all depends on CPI-U.
The interest is determined by adding the fixed rate (currently 0, but changes every six months) and the CPI-U rate (changes every six months too). Good news is that unlike TIPS, I bonds can never go below zero in a deflationary environment but can pay zero if CPI-U is negative and the fixed rate is zero or low where the CPI-U is negative more than the fixed rate that is being credited.
If you think inflation will continue to run high, maybe May's rate will be similar, if things start to cool off, you'll get a lower rate in May.
You also have to hold the bond for a minimum of 5 years too otherwise you forfeit some of the interest.

Couple other things ...

You can't cash in an I-bond for at least a year. If you cash it in between 1 and 5 years, the penalty is 3 months' interest. That's a pretty small penalty given the interest rate. If you buy a $10K bond, it will earn about $700 in the first year. If you need or want the $ and cash it in one day later, you'll give up $175. That's not wonderful, but it still means you made 5.25% on your investment. And if you don't cash it in until, say, Year 4, that $175 will seem like peanuts. So it's not as if you're locked in for 5 years.

The bonds will continue to earn interest for up to 30 years if one wants to keep them that long. I bought my first I-bond in 2003 and have just let it ride.

My biggest nit is the $10K limit. I'd have loved to have bought more of this completely safe, fairly liquid investment at this great rate. Remember that's $10K per person. So one could buy a bond for oneself, the spouse and even the kids.
“It’s not how white men fight.” - Tucker Carlson

MuggsyB

  • All American
  • *****
  • Posts: 12685
Re: Investing Thread
« Reply #1595 on: December 07, 2021, 05:52:06 PM »
1. I find it weird that at the beginning of the article he does a victory dance for the Dow hitting 36,000 even though his prediction was seriously, seriously wrong.

2. His overall premise is "buy and hold over the long-term" from what I could glean, isn't it?

Yes.  And the every-time there's been major storms the market has weathered them.  I found it interesting that a fewer percentage of people are invested now than in 1999.  The bottom line is from a long term perspective there isn't a better option than the market despite the obvious fluctuations. 

Tortuga94

  • Walk-On
  • *
  • Posts: 16
Re: Investing Thread
« Reply #1596 on: December 07, 2021, 07:30:04 PM »
Couple other things ...

You can't cash in an I-bond for at least a year. If you cash it in between 1 and 5 years, the penalty is 3 months' interest. That's a pretty small penalty given the interest rate. If you buy a $10K bond, it will earn about $700 in the first year. If you need or want the $ and cash it in one day later, you'll give up $175. That's not wonderful, but it still means you made 5.25% on your investment. And if you don't cash it in until, say, Year 4, that $175 will seem like peanuts. So it's not as if you're locked in for 5 years.

The bonds will continue to earn interest for up to 30 years if one wants to keep them that long. I bought my first I-bond in 2003 and have just let it ride.

My biggest nit is the $10K limit. I'd have loved to have bought more of this completely safe, fairly liquid investment at this great rate. Remember that's $10K per person. So one could buy a bond for oneself, the spouse and even the kids.

Mostly correct, the only thing is the 7% rate for November is only for 6 months. Worst case scenario is the rate goes to zero in May and you get about 3.5 for the year. I think it will do better than the 3.5 for the year as I don't think we will see a deflationary environment in the next six months.

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1597 on: December 07, 2021, 10:52:56 PM »
Mostly correct, the only thing is the 7% rate for November is only for 6 months. Worst case scenario is the rate goes to zero in May and you get about 3.5 for the year. I think it will do better than the 3.5 for the year as I don't think we will see a deflationary environment in the next six months.

Thanks for pointing that out.
“It’s not how white men fight.” - Tucker Carlson

TSmith34, Inc.

  • All American
  • *****
  • Posts: 5083
Re: Investing Thread
« Reply #1598 on: December 08, 2021, 07:10:39 AM »
Lots of analyst love for AAPL (glasses! cars!) taking it to an all-time high despite production snarls. Seems fully valued here to me, not that valuations have stopped tech companies from continuing to rise, however.
If you think for one second that I am comparing the USA to China you have bumped your hard.

MU82

  • All American
  • *****
  • Posts: 22723
Re: Investing Thread
« Reply #1599 on: December 08, 2021, 09:09:40 AM »
Lots of analyst love for AAPL (glasses! cars!) taking it to an all-time high despite production snarls. Seems fully valued here to me, not that valuations have stopped tech companies from continuing to rise, however.

Good thing all of us sold the AAPL we had and/or never bought it again based on the advice of Smuggles (Heisy) about 2000% ago!

Seriously ...

I'd agree with fully valued, and maybe even push it to crazy overvalued here. But I (and many others) have been saying that about AAPL and lots of stocks for a year or more now. It's a momentum market, especially in this space.
“It’s not how white men fight.” - Tucker Carlson

 

feedback