If she is dealing with a full service broker then that is a pretty fair price and probably on the low side.
The question is, does she really need a full service broker? If she was using a discount broker, as you apparently are, then her charge would have probably been under $10.
I heard a rumor going around this morning that it was the Koreans that blew up the oil rig
I haven't heard that rumor but gagrice and I were discussing the possibility that this could have been some type of terrorist attack on another forum a few days ago. Why? Because these rigs seem to be easy pickings, plus there has been very little discussion of the cause of the explosion on the national news. Almost as if there was a news black out. I had not thought of the Koreans but it is certainly possible.
Being 67 and retired, most of my income is from investments, so I am probably a little more cautious than most of you and would be considered an income investor. A good 65% of my portfolio is in municipal bonds. I love those tax free bonds. Utility stocks, and various preferred stocks that pay a nice dividend make up the rest. When I do buy anything it is usually a trade of at least $100,000.
I am currently considering Well Fargo preferred stock, symbol WCO. Wells Fargo has a good reputation, and the current dividend is 8.1%. annualized. Any thoughts on this one?
I got 700 shares of C for $8.95 commission at Schwab when your wife was getting hers Gary. And they aren't even the cheapest. All online but still ....
The merits of $100K on a single trade is relative to its percentage of your portfolio, as well as the level of risk.
As an obvious example, if your portfolio was valued at $500K, then as a single trade, $100K could be considered highly significant, depending on the nature of the investment... yet if your portfolio was valued at $3mil, it could be considered less significant. With regards to risk levels, $100K on a muni bond investment would generally be considered much less risky than $100K on a speculative stock, for example.
In any event, your strategy sounds very smart considering your age and the goal of producing income from your investments. It is typical to have less stocks, more bonds, and less risk in a portfolio as the account holder's age increases, and as income requirements increase.
As far as my opinion on Wells Fargo goes, I consider Wells Fargo to be an excellent company, and I owned some Wells stock at one time. In fact, I am considering purchasing Wells Fargo stock in the future, but only if its share price gets dragged down with the financial sector to an unrealistic level.
Dividend stocks are particularly attractive, IMO, especially when the stock share itself could appreciate in addition to the dividend itself... and especially when the market tends to be volatile.
Wells is a premier bank, and in tough times it should weather a storm better than many... certainly better than Citi, which is not a premier bank by comparison. The interest I have in Citi is that I see a whole lot of upside potential, albeit at a greater risk.
Wells Fargo common stock (not the same as you are considering, but for refernce purposes) is trading around the same high it has traded for 5 years, with exception of the volatility surrounding the financial crisis.
The words that come to mind when I think of Wells Fargo Bank are "steady as she goes"... a steady 8.1% is nice for your situation, so, I think you have make a good choice as I understand your goal.
Your candid honesty is an inherently important component of this winning formula... and I do beleive it is a winning formula. In fact, I am convinced that the more that you, Len, myself, Tony, Clembo, Houdini, Steve, Gary, Circlew, Joe, gagrice and all the others here discuss investing, the better it will be for all of us. So, don't hold back, and no apology necessary.
Hey tag,
Great comment. So it is my understanding that almost nobody beats the market averages on a reliable basis. Much research shows a buy and hold, low-cost index fund approach is almost always superior to trying to pick individual stocks. Are you guys actually trying to time the market on a day to day basis?
Myself, I have an asset allocation, I have a spreadsheet, and I rebalance annually. I have about 10 mutual funds in a market segment slice and dice approach. I've stuck through the big crash and I am almost back where we were in October 2007. Hope your approach is working for you.
Check and see when it is callable....Alot of the preferred bank stocks are callable in a couple of year, and usually around twenty five dollars....I have a few I bought last year, and they just pay each quarter, an income producer.......I have recently cut back the etfs I also purchased---just to be more comfortable---and suggest you look into these two....jnk and hyg..They pay monthly.. I am also in your same position,and I am conservative at heart, but have found that sometimes the safest actions are the bold actions....I think Tagman has an astute feeling for the market, and although I do not diversify to the extent that he does, I like his picks and have even joined in the c hoopla which I also think is a long term winner......If we all have `good luck` that will be the best that can happen to us all....Tony
it is my understanding that almost nobody beats the market averages on a reliable basis.
The different components that comprise the "average" are proof that many do indeed beat the average. IOW, the "average" is comprised of varying degrees of winners and losers. The winners beat the average... the losers do worse than average.
Much research shows a buy and hold, low-cost index fund approach is almost always superior to trying to pick individual stocks.
There are many different approaches. Consider that "funds" can be comprised of individual stocks that have been selected by "managers"... some are better than others. If you feel that "average" is OK, then fine. I prefer to do better. I think others here also prefer to do better.
Are you guys actually trying to time the market on a day to day basis?
For the most part, no... day trading is a different animal. I have done so on ocassion, when a stock is taking a big leap, and then I cash in. However, there are times it is smart to get out of a stock or the market as a whole.
The different components that comprise the "average" are proof that many do indeed beat the average. IOW, the "average" is comprised of varying degrees of winners and losers. The winners beat the average... the losers do worse than average.
Of course there are winners. But studies have shown that very few winners (say, the person who far outpaced the S&P 500 over the last 3 years) go on to repeat their good performance. Yet they all think they can do better than average. So over time, index funds beat about 70% of their actively traded counterparts in the same sector.
We all want to earn above average. But when average is in the 70th percentile in an index fund, and you can count on that for 5, 10, 20 years running --- well nearly nobody can do that by active stock picking. Since I'm in it for the long haul, I like those odds better. :shades:
We won't even talk about the differences in costs of active vs. passive management and the handicap that also adds.
Thanks tagman, I appreciate your thoughts. Looks like we are pretty much on the same page.
We are.
In fact, I have decided to sideline the rest of this latest downturn/correction. Earlier today, when the market briefly rebounded, I eliminated all stocks from my portfolio with specific exception of all my dividend-paying stocks. I had intended to do this days ago, but I have achieved more than enough upside gains that it wasn't a real problem to wait another day or two to see the market conditions a little clearer.
From my perspective, I see a shift from buying on the dips to selling on the rallies... and that can spell trouble, IMO. The trend and market sentiment may have changed for the short term.
As I said, I have kept every one of my dividend-paying stocks, but I have cut loose all the others for now. Once the dust settles, I will start buying back in... possibly with a vengeance, or very slowly, depending upon the situation.
Everyone here has their own strategies, and I respect them, but I have shown that like to jump in and out of the market a bit more often than typical. It usually works for me, but not always... as it did not entirely work for me the last time I tried it. I would have realized bigger gains with Citi had I held on through the last correction because I got back in just a tad too late. I am not complaining, because I have done very well, but I am a bit compulsive in the way I approach this, and I like it to go "just right" according to my plan... LOL!
Long-term I am bullish, but I am attempting to circumvent this downturn, but I might be too late. We'll see what happens. There is no large risk to my actions, so I am comfortable to do this. Should be interesting, at the least!
We won't even talk about the differences in costs of active vs. passive management and the handicap that also adds.
I pay no fees, if that's what you are referring to, and I have access to as much broker assistance as I might request... a very fortunate situation, although I tend to be a lone ranger.
I pay no fees, if that's what you are referring to, and I have access to as much broker assistance as I might request... a very fortunate situation, although I tend to be a lone ranger.
Energy Name Price Change %Change Crude Oil Jun 10 79.64 -3.10 -3.75% Heating Oil Jun 10 2.18 -0.08 -3.32% Natural Gas Jun 10 3.98 -0.03 -0.80% RBOB Gasoline Jun 10 2.22 -0.11 -4.57%
I have sectioned off and committed a large portion of my assets to secured investments that are within "managed" accounts. The broker benefits from managing those accounts. The rest is mine to do with as I want, with almost no restrictions, unless I go too far with day-trading, which sends up a red flag. Since I am not a heavy day-trader, the whole formula works like a charm. It's a win-win. The broker is happy with the accounts under his control, and I am happy with my portfolio and my freedom.
I think this is great as well. Yes, the European (Greece in particular) debt problem has sent some shivers to the markets world-wide (including the U.S.) in the short term, but I very much doubt this will be a new and massive economic collapse. On the contrary, this is just a little blip to an overall long term bullish U.S. stock market. Just about all economic indicators point in a positive direction right now. I love the fact that crude is heading south (probably short term sell-off unfortunately) and the gas prices at the pump should sell off at least 20-30 cents in the next 4-5 days.
I realize that TM sold a lot of his stocks but I bet he will again be a buyer in a few days if not sooner .
I realize that TM sold a lot of his stocks but I bet he will again be a buyer in a few days if not sooner
Sooner the better as far as I'm concerned. To be honest, I want to see the bottom of this short-term cycle, and I am hoping for an opportunity to scoop up some over-sold stocks. I am poised and ready.
BTW, I forgot to mention that I kept UPS in addition to my dividend stocks.
OK Tag. I am going to put some pressure on you . I think you will be buying stocks either today or tomorrow.
I will go out on the limb and say that this fairly minor correction based on the European BS is finished. For everybody here that means sell everything .
I'm simply waiting for some over-sold stocks that I like, and for this latest global storm to simmer down a bit... I am not convinced it is over.
Since you are a meteorologist, I'll put it this way... I might be wrong, but I think we are in the eye of the storm... looks calm but the next half is still coming.
As you know, I intended to get out and miss the first half as well, but I hung in there. Since I still think there is more to come, I'm simply going to sit it out.
Whatever happens, I'm sure not going to lose any sleep over it, and I'll definitely be in the market full force before too long.
As I advised very early this morning, sell everything since I was thinking that this correction was finished
Haha... And, because I washed the Jag, I expect it to rain.
Actually, I love your optimism... for the most part you are correct. Our economy is doing much better, regardless of what the Obama critics say. It is clearly on the mend. But there are some serious global issues going on, as well as some current domestic challenges. It won't be long before it all passes into the pages of history, and we will move into the next phase of the market's advance.
No, not yet... there isn't anything rational here. I'm waiting. Too much violence in Greece... could get worse. This is nuts.
Could re-visit the lows, or even create new lows.
You are probably right. After all, you have nailed this now huge correction. In any case, it is too late. I bought 50 more shares for better or for worse.
Here is an interesting story that just came out:
05/06 14:09 CDT White House says watching Greek crisis and impact 5-6-2010 13:57 White House says watching Greek crisis and impact
WASHINGTON, May 6 (Reuters) - The Obama administration is keeping a close eye on the debt crisis in Greece and its global impact, a White House official said on Thursday. "The president has heard regularly from his economic team," White House spokesman Robert Gibbs said, adding that Obama's aides had been in frequent contact with their European counterparts. "Treasury is monitoring the situation closely," Gibbs said. The Dow Jones industrial average was down more than 3.5 percent in mid-afternoon in reaction to mounting concerns over the Greek crisis. (Reporting by Care Bohan and Ross Colvin; Editing by Vicki Allen) ((caren.bohan@thomsonreuters.com; +1 202 898 8300; Reuters Messaging: caren.bohan.reuters.com@reuters.net))
This is all very interesting, and I realize it is possible that I missed a big opportunity, but I am not convinced that there isn't even more volatility down the road.
Besides, how does the SEC deal with the computer error? What happens to all those related trades?
I've read that the big Dow falling down of today started after an erroneous selling of billions instead of millions on shares of Procter & Gamble. Is that true?
Goldmen making off debts and lies, standard poors misleading investors again and again, gambler brokers adding ice to the cake, what a wonderful world!
I've read that the big Dow falling down of today started after an erroneous selling of billions instead of millions on shares of Procter & Gamble. Is that true?
Yes... seems to be. I'm sure there will be more details soon.
Regardless, the error was unrelated to the pre-existing volatility... but it didn't help things a bit. Just shattered more trust in the markets. The trend was/is down anyway.
Were you ever right about this week. I missed everything today as I was closing on the loan that got approved a few weeks ago and was tied up with the lawyers. Yesterday was hectic as hell too. So I've had no focus on Wall street at all. But getting a loan that saves me $10K a week post tax and which my financial calcs say goes away in 4 years or less was a top priority. Business is the strongest in 2 years right now, even stronger than pre-crash so I'm trying to rationalize panic vs real economic threat. I come down on the side of panic and seeing those headlins about Greece isn't pleasant. I never have bought into the Euro and always thought it would be a short lived currency. It's really hard to have a consolidated currency without consolidated government. Everyone's agenda is different. We'll see.
I just bought 50 more shares of Apple. I am probably throwing hard earned money away, but it's only money, right?
Charlie,
Let's say you bought 50 shares at $250 just for ease of calculation. That's $12,500. You could have bought 1,250,000 shares of ACN instead and a few minutes later made $49,987,500!. Man if this doesn't get high frequency trading regulation, nothing will.
I guess I should tell you guys that I am still concerned about the stock market, and I must warn all of you to be very careful with your investments. I urge you to take the necessary action immediately, without delay, if it is warranted.
There will always be stocks to purchase, but I am not comfortable to participate in the market under these current conditions.
I am still bullish long-term, but I believe that there is no reason to suffer short-term losses if they can be avoided.
With exception of some dividend-paying stocks, my porfolio is in cash, just waiting for what I believe will be a better time to get back in. And when the right time comes, I will buy stocks without hesitation.
In the meantime, I hope you are all VERY careful and that you do not suffer any serious losses ahead.
Let's say you bought 50 shares at $250 just for ease of calculation. That's $12,500. You could have bought 1,250,000 shares of ACN instead and a few minutes later made $49,987,500!. Man if this doesn't get high frequency trading regulation, nothing will.
This is mind boggling. All this happened in a matter of a minute or so I believe. It will be interesting to see how many (if any) of the trades stand during that hectic minute or two when the Dow went from about 300 lower to 1000 lower and back up to 350 lower. I bought the 50 shares of APPL at $243 on the way back up from $200. Who knows? My trade may not be allowed either.
This will be one fascinating investigation :surprise: .
I expect further market turmoil for a substantial while.
The speculative shark pack is hungrily attacking the Euro by focusing on well selected objectives in turn, building up investor panic and getting a valuable collaboration from not-so-clear credit rating agencies and media (always those of Mr Murdock in the cutting edge). The philanthropist Mr Soros (and others) has great experience in doing this. The successful attacks against the Sterling Pound, Peseta, Yen, etc., in the Nineties avail it. Oh, and the hesitant and slow reactions of EU politicians are of great help as well.
I can understand any intelligent fellow could made good profits of the peaks and downs by being very attentive and agile in the market convulsion concocted by the big speculators. If not, one can only seat and wait, and expect too that one's particular and collective (as a national group) interests are not irreversible damaged as a 'collateral' result.
It seems to me as if the recent financial crisis has been for nothing. Some market regulations are clearly needed, IMO. There is too much at stake.
Tag, the market still looks pretty crappy. You have been SO right about this move. Are you buying anything yet? I am obviously losing my behind on my recent purchases (especially APPL). However, I am still quite certain that I will be just fine in the not too distant future.
BTW, how many times have I stated something about the market the past few months and the opposite happens? The ironic thing about it is that on several occasions, I was half kiddingly advising people to take the opposite view. For example, it was early this week when I said , we may have seen the low on the correction. I then said in jest, "that means sell everything". If only I had listended to my own advice .
Tag, the market still looks pretty crappy. You have been SO right about this move. Are you buying anything yet?
Not buying... just holding my dividend-paying stocks, and some of them actually went up today... which shows that others are buying them as a flight to safety.
how many times have I stated something about the market the past few months and the opposite happens?
Hahaha... That happens to all of us from time to time... but the more important question is whether or not you feel confident and that you understand your investment decisions. I say this because I have posted at one time that the formula for beating the averages is to follow certain rules... one of them is that you totally understand your investments and feel good about them. If you don't feel good about a stock and understand that stock, then you shouldn't own it. If you don't feel like you understand the market, then you have no real business being in it.
That's why I am out, with exception of the divident-paying stocks. I was deeply invested in the market when I understood what I was doing. I felt condfident that I could make successful money-making decisions. But this current market is too unpredictable and irrational. I do not know what I am dealing with well enough to make a decision that would assure me of a successful outcome.......... not yet.
I agree with you on the Dividend paying stocks, I now own many (although some are underwater on the principal). I see opportunity for well run bank stocks, Wells, and even BOA at these levels.
You are correct that the mess may continue for a while, we must be prepared to take the ups and downs if you want to be in at these levels.
Since the market is so unsteady, I decided to spend a little cash last week and bought a new Harley. My wife won't let me add any other cars and I've always wanted a bike so I just went for it. I'll bet it holds it's value better than many of the stocks in my portfolio, and it is a blast to ride - can't do that with any stock.
...The philanthropist Mr Soros ... has great experience in doing this....
I don't trust him... and personally think he is kind of dangerous and threatening to the world's financial stability, and has his own overly-selfish agenda. In a similar way that Dick Cheney was (is?) dangerous and threatening to the world's political stability, and operated primarily with his own narrow-minded self-serving agenda and a disturbing disregard for humanity at large. :sick:
It's a shame that only a handful of powerful people can do so much damage to the billions of people in the world, or worse yet, do nothing for them at all.
I have my doubts that there will be any serious financial reform package that will come out of Washington. Any final legislation will be quite watered down, IMO. I think history proves it is much more likely that we wil continue to see corruption, perhaps in new ways we haven't even seen yet.
Let me put it this way... as the rules change, there will be new ways to break them.
In spite of all of that, the U.S. stock market is still an amazing institution for investing. Unfortunately, it has risks that are not solely based upon the quality of the companies comprising the indexes... instead the risks also include the behavior and decisions of powerful people that can unfairly and inappropriately manipulate the markets politically and financially.
Jose, how are you? How's your rehab (physical therapy) going?
as the rules change, there will be new ways to break them
I fully agree with you, TM. Not only with the quoted sentence but with the entire post. One can just complain a bit about the wild but has to fight the lions nevertheless.
Thank you for asking about my recovery. I still cannot walk or stand on my feet in order to consolidate as much as possible the pubic and sacroiliac joints that were damaged and surgically operated (I broke also a [bone] isquiopubic branch). In particular the pubis needs to be very solid before applying charges and tractions on it. Therefore my physical therapy is by now limited to move my legs while seated or in bed. I too use electric stimuli with one of those fitness stimulators. Then, I read, I listen to the music, I watch TV, I use the computer a lot, I pretend I'm using my muscles, and I await while burning in impatience.
One thing I have read these last days which I found very interesting indeed is the recently published news on Neanderthal ascendency in modern eurasian but not african [non-permissible content removed] sapiens. As a brief: http://cosmiclog.msnbc.msn.com/archive/2010/05/06/2295639.aspx
Regards, Jose PS: I apologize for the medical jargon.
A good article about some of the EU issues..I am personally hoping it collapses so it can be reformed, and the EU can become a trading agreement and not a megalomaniacal structure of senseless thought policing laws, defective immigration policies, and endless social welfare-style bailouts where those who work fund those who do not. But that's just me...
In other words, I wish a demise of the EU as it stands now. Europe can be united and peaceful without sovereignty-stealing legislation and economic irresponsibility.
Guys, lets not forget that there is no empirical evidence that anyone can "time" the market, not Jim Cramer, not the Money Honey, not Larry Kudlow, not Goldman, not Long Term Capital with their "reversion to the mean" models. No one.
Moreover, asset allocation, not individual stock or bond selection, predicts 80% of one's return.
In other words, spend most of your time and effort on asset allocation and then buy and hold.
I get a kick out of the fact that the personal finances of top level Wall St types are usually very undiversified and over leveredged with predictable results. Didn't Bear Stearns Jimmy Cayne have most of his money in Bear and just two weeks before it imploded he bought two adjoining condos at The Plaza?
Hi Fintail, you know our views on the EU are different.
I read yesterday or the day before yesterday the article you quote.
I wished Mr Köhl was in power now instead of Ms Merkel to better deal with the current situation. Mr Köhl, being a German conservative also, had much more insight than Ms Merkel, as other previous Chancellors (e.g., Mr Adenauer or Mr Schmidt) had. Ms Merkel has been short-sighted and hesitant on applying the economical measures needed to help Greece (and the EU, it encompassed Germany). Until the German banks and other German influential people have not remembered to Ms Merkel that there is a lot of German money at risk, and that 80% of the German industrial export is bought within the EU itself, she has not reluctantly taken the definitive step.
Others have also remembered to Ms Merkel that as recently as three/five years ago it was Germany, with the assent of the remaining EU, which had a public debt well above of that allowed by the EU regulations. That debt was caused by the German reunification, and used to stimulate the East-German economy, in the same manner that some South European Countries have fall in debt to stimulate theirs after the recent financial crisis (not the case of Greece, I'm afraid, which was making up its finances with the help of Goldman Sachs among others).
It has also being remembered that Spain and Portugal were pointed to as 'modelic' Countries in terms of public debt since the Euro was introduced (2002) until the recent crisis. Also, that South European Countries were in favor of German reunification while Ms Thatcher and Mr Mitterrand where secretively speaking on how to avoid it. This was publicly acknowledged by Mr Köhl to Mr Gonzalez, former Prime Minister of Spain. This is politics, but is the sort of politics that a German Chancellor should weight when being reticent in helping the 'lazy' Southerns.
As you may know, in my life I have stayed for years in England, France and Germany in addition to Spain. I've paid frequent visits to most of the other European Countries. In every place I have met excellent, good, not so good and bad people. So I was happy everywhere, not finding any reason in order to divide Europe in good-working arius and the rest. In which I coincide with you, may be, is that the EU should be composed of nations well in favor of the Union, not only because of some economic advantages which are evident only in times of bonanza. If you are not for good and bad, better not to be in any time.
Merkel is also guaranteeing a political bloodbath for her cronies, as a significant amount of Germans are not happy about being forced to subsidize the mistakes of others. She's a fairly aimless leader. Germany needs to assert itself and not dawdle around before making questionable decisions. If Germany is to provide a bailout, Germany should dictate the terms. Germany has not owed anyone anything for eons, and should take some control of its destiny. Like it or not, Germany is the heart of Europe.
I find it funny that nations like France or England thought they should have any say in German unification - look how they have managed themselves over the past few decades. It always brings me back to the old song lyrics..."you can't even run your own life, I'll be damned if you'll run mine" :shades: . Germany received significantly less ERP funds than France or England, yet has dominated both of them economically and industrially for some time. And if it wasn't for Germany right now, the EU would be in serious danger of a complete economic collapse. IMHO, France and England have been off course for a few generations. If all of Europe had even a half-baked German work ethic, it wouldn't be in the trouble it is now.
Should Germans have to work harder so others can have easy lives? Did Germany not export to other European nations before the EU was created? We both know the answer. I don't accept the thought that because Germany owes everything to the EU because of exports, that such a bailout is obligatory - if this material wasn't bought from Germany, who else would provide it? Surely there are good people everywhere, but some areas are going to be on the dole forever unless they are forced to actually get to work.
I think every EU nation should hold a referendum about whether to continue the union for anything but trade. Participation should be at the level of the Swiss, at most. Criminal legislation, broken freedom of speech, immigration, and so on should not be dictated by a group of idiots in Brussels. If the EU keeps evolving in this manner, Europe is going to have a dim future, and a stagnant or decaying economy - especially when the US is finally unable or unwilling to defend it, and the region is forced to pay to safeguard itself from the menace to the east. The EU is quickly becoming kind of a EUSSR - more and more unwilling members forced under an umbrella managed by zealots who will do anything to keep their personal money factory alive. A weirdo mix of Soviet and fascist overtones.
All of that being said, I hope the Euro continues to decline in value and remains depressed for some time. It will both aid in the global export market, especially for German products - and it will make more people in Europe question the structure and sustainability of the alliance itself.
Comments
The question is, does she really need a full service broker? If she was using a discount broker, as you apparently are, then her charge would have probably been under $10.
2013 LX 570 2016 LS 460
I haven't heard that rumor but gagrice and I were discussing the possibility that this could have been some type of terrorist attack on another forum a few days ago. Why? Because these rigs seem to be easy pickings, plus there has been very little discussion of the cause of the explosion on the national news. Almost as if there was a news black out. I had not thought of the Koreans but it is certainly possible.
2013 LX 570 2016 LS 460
I am currently considering Well Fargo preferred stock, symbol WCO. Wells Fargo has a good reputation, and the current dividend is 8.1%. annualized. Any thoughts on this one?
2013 LX 570 2016 LS 460
I got 700 shares of C for $8.95 commission at Schwab when your wife was getting hers Gary. And they aren't even the cheapest. All online but still ....
As an obvious example, if your portfolio was valued at $500K, then as a single trade, $100K could be considered highly significant, depending on the nature of the investment... yet if your portfolio was valued at $3mil, it could be considered less significant. With regards to risk levels, $100K on a muni bond investment would generally be considered much less risky than $100K on a speculative stock, for example.
In any event, your strategy sounds very smart considering your age and the goal of producing income from your investments. It is typical to have less stocks, more bonds, and less risk in a portfolio as the account holder's age increases, and as income requirements increase.
As far as my opinion on Wells Fargo goes, I consider Wells Fargo to be an excellent company, and I owned some Wells stock at one time. In fact, I am considering purchasing Wells Fargo stock in the future, but only if its share price gets dragged down with the financial sector to an unrealistic level.
Dividend stocks are particularly attractive, IMO, especially when the stock share itself could appreciate in addition to the dividend itself... and especially when the market tends to be volatile.
Wells is a premier bank, and in tough times it should weather a storm better than many... certainly better than Citi, which is not a premier bank by comparison. The interest I have in Citi is that I see a whole lot of upside potential, albeit at a greater risk.
Wells Fargo common stock (not the same as you are considering, but for refernce purposes) is trading around the same high it has traded for 5 years, with exception of the volatility surrounding the financial crisis.
The words that come to mind when I think of Wells Fargo Bank are "steady as she goes"... a steady 8.1% is nice for your situation, so, I think you have make a good choice as I understand your goal.
TM
Hey tag,
Great comment. So it is my understanding that almost nobody beats the market averages on a reliable basis. Much research shows a buy and hold, low-cost index fund approach is almost always superior to trying to pick individual stocks. Are you guys actually trying to time the market on a day to day basis?
Myself, I have an asset allocation, I have a spreadsheet, and I rebalance annually. I have about 10 mutual funds in a market segment slice and dice approach. I've stuck through the big crash and I am almost back where we were in October 2007. Hope your approach is working for you.
The different components that comprise the "average" are proof that many do indeed beat the average. IOW, the "average" is comprised of varying degrees of winners and losers. The winners beat the average... the losers do worse than average.
Much research shows a buy and hold, low-cost index fund approach is almost always superior to trying to pick individual stocks.
There are many different approaches. Consider that "funds" can be comprised of individual stocks that have been selected by "managers"... some are better than others. If you feel that "average" is OK, then fine. I prefer to do better. I think others here also prefer to do better.
Are you guys actually trying to time the market on a day to day basis?
For the most part, no... day trading is a different animal. I have done so on ocassion, when a stock is taking a big leap, and then I cash in. However, there are times it is smart to get out of a stock or the market as a whole.
Hope that answers your post.
TM
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Not really, we are just a bunch of guys who don't mind sharing our investment strategy, much as you just did. Stick around, all input is appreciated.
2013 LX 570 2016 LS 460
Of course there are winners. But studies have shown that very few winners (say, the person who far outpaced the S&P 500 over the last 3 years) go on to repeat their good performance. Yet they all think they can do better than average. So over time, index funds beat about 70% of their actively traded counterparts in the same sector.
We all want to earn above average. But when average is in the 70th percentile in an index fund, and you can count on that for 5, 10, 20 years running --- well nearly nobody can do that by active stock picking. Since I'm in it for the long haul, I like those odds better. :shades:
We won't even talk about the differences in costs of active vs. passive management and the handicap that also adds.
We are.
In fact, I have decided to sideline the rest of this latest downturn/correction. Earlier today, when the market briefly rebounded, I eliminated all stocks from my portfolio with specific exception of all my dividend-paying stocks. I had intended to do this days ago, but I have achieved more than enough upside gains that it wasn't a real problem to wait another day or two to see the market conditions a little clearer.
From my perspective, I see a shift from buying on the dips to selling on the rallies... and that can spell trouble, IMO. The trend and market sentiment may have changed for the short term.
As I said, I have kept every one of my dividend-paying stocks, but I have cut loose all the others for now. Once the dust settles, I will start buying back in... possibly with a vengeance, or very slowly, depending upon the situation.
Everyone here has their own strategies, and I respect them, but I have shown that like to jump in and out of the market a bit more often than typical. It usually works for me, but not always... as it did not entirely work for me the last time I tried it. I would have realized bigger gains with Citi had I held on through the last correction because I got back in just a tad too late. I am not complaining, because I have done very well, but I am a bit compulsive in the way I approach this, and I like it to go "just right" according to my plan... LOL!
Long-term I am bullish, but I am attempting to circumvent this downturn, but I might be too late. We'll see what happens. There is no large risk to my actions, so I am comfortable to do this. Should be interesting, at the least!
TM
I pay no fees, if that's what you are referring to, and I have access to as much broker assistance as I might request... a very fortunate situation, although I tend to be a lone ranger.
TM
You are fortunate, how do you pull that one off?!
Energy Name Price Change %Change
Crude Oil Jun 10 79.64 -3.10 -3.75%
Heating Oil Jun 10 2.18 -0.08 -3.32%
Natural Gas Jun 10 3.98 -0.03 -0.80%
RBOB Gasoline Jun 10 2.22 -0.11 -4.57%
Len was right...just took a few more months!!
Regards,
OW
2013 LX 570 2016 LS 460
Consider that the price creeped up before going down, so there's no real net difference... and 3-4% isn't exactly "falling off the cliff" anyway.
Regardless of that miss, Len will always get the most credit from me for his brilliant insights.
TM
Well, here's how...
I have sectioned off and committed a large portion of my assets to secured investments that are within "managed" accounts. The broker benefits from managing those accounts. The rest is mine to do with as I want, with almost no restrictions, unless I go too far with day-trading, which sends up a red flag. Since I am not a heavy day-trader, the whole formula works like a charm. It's a win-win. The broker is happy with the accounts under his control, and I am happy with my portfolio and my freedom.
TM
I realize that TM sold a lot of his stocks but I bet he will again be a buyer in a few days if not sooner
TM
Sooner the better as far as I'm concerned. To be honest, I want to see the bottom of this short-term cycle, and I am hoping for an opportunity to scoop up some over-sold stocks. I am poised and ready.
BTW, I forgot to mention that I kept UPS in addition to my dividend stocks.
TM
I will go out on the limb and say that this fairly minor correction based on the European BS is finished. For everybody here that means sell everything
I'm simply waiting for some over-sold stocks that I like, and for this latest global storm to simmer down a bit... I am not convinced it is over.
Since you are a meteorologist, I'll put it this way... I might be wrong, but I think we are in the eye of the storm... looks calm but the next half is still coming.
As you know, I intended to get out and miss the first half as well, but I hung in there. Since I still think there is more to come, I'm simply going to sit it out.
Whatever happens, I'm sure not going to lose any sleep over it, and I'll definitely be in the market full force before too long.
TM
As I advised very early this morning, sell everything since I was thinking that this correction was finished
Haha... And, because I washed the Jag, I expect it to rain.
Actually, I love your optimism... for the most part you are correct. Our economy is doing much better, regardless of what the Obama critics say. It is clearly on the mend. But there are some serious global issues going on, as well as some current domestic challenges. It won't be long before it all passes into the pages of history, and we will move into the next phase of the market's advance.
TM
I am glad I got out of almost all of my stocks yesterday. This volatility is insane.
TM
I just bought 50 more shares of Apple. I am probably throwing hard earned money away, but it's only money, right?
Could re-visit the lows, or even create new lows.
TM
Could re-visit the lows, or even create new lows.
You are probably right. After all, you have nailed this now huge correction. In any case, it is too late. I bought 50 more shares for better or for worse.
Here is an interesting story that just came out:
05/06 14:09 CDT White House says watching Greek crisis and impact
5-6-2010 13:57 White House says watching Greek crisis and impact
WASHINGTON, May 6 (Reuters) - The Obama administration is
keeping a close eye on the debt crisis in Greece and its global
impact, a White House official said on Thursday.
"The president has heard regularly from his economic team,"
White House spokesman Robert Gibbs said, adding that Obama's
aides had been in frequent contact with their European
counterparts.
"Treasury is monitoring the situation closely," Gibbs
said.
The Dow Jones industrial average was down more than 3.5
percent in mid-afternoon in reaction to mounting concerns over
the Greek crisis.
(Reporting by Care Bohan and Ross Colvin; Editing by Vicki
Allen)
((caren.bohan@thomsonreuters.com; +1 202 898 8300; Reuters
Messaging: caren.bohan.reuters.com@reuters.net))
Keywords: OBAMA/GREECE CRISIS
RIC: N2_UBMS PNAC: nWEN4375
RET FNGEMN
[Related Stories]
Wish I had some extra cash lying around.
"Better".
Stellar move, IMO.
This is all very interesting, and I realize it is possible that I missed a big opportunity, but I am not convinced that there isn't even more volatility down the road.
Besides, how does the SEC deal with the computer error? What happens to all those related trades?
Wow, what a day!
TM
Goldmen making off debts and lies, standard poors misleading investors again and again, gambler brokers adding ice to the cake, what a wonderful world!
Regards,
Jose
Yes... seems to be. I'm sure there will be more details soon.
Regardless, the error was unrelated to the pre-existing volatility... but it didn't help things a bit. Just shattered more trust in the markets. The trend was/is down anyway.
TM
Were you ever right about this week. I missed everything today as I was closing on the loan that got approved a few weeks ago and was tied up with the lawyers. Yesterday was hectic as hell too. So I've had no focus on Wall street at all. But getting a loan that saves me $10K a week post tax and which my financial calcs say goes away in 4 years or less was a top priority. Business is the strongest in 2 years right now, even stronger than pre-crash so I'm trying to rationalize panic vs real economic threat. I come down on the side of panic and seeing those headlins about Greece isn't pleasant. I never have bought into the Euro and always thought it would be a short lived currency. It's really hard to have a consolidated currency without consolidated government. Everyone's agenda is different. We'll see.
Charlie,
Let's say you bought 50 shares at $250 just for ease of calculation. That's $12,500. You could have bought 1,250,000 shares of ACN instead and a few minutes later made $49,987,500!. Man if this doesn't get high frequency trading regulation, nothing will.
Thanks Len.
I guess I should tell you guys that I am still concerned about the stock market, and I must warn all of you to be very careful with your investments. I urge you to take the necessary action immediately, without delay, if it is warranted.
There will always be stocks to purchase, but I am not comfortable to participate in the market under these current conditions.
I am still bullish long-term, but I believe that there is no reason to suffer short-term losses if they can be avoided.
With exception of some dividend-paying stocks, my porfolio is in cash, just waiting for what I believe will be a better time to get back in. And when the right time comes, I will buy stocks without hesitation.
In the meantime, I hope you are all VERY careful and that you do not suffer any serious losses ahead.
TM
This is mind boggling. All this happened in a matter of a minute or so I believe. It will be interesting to see how many (if any) of the trades stand during that hectic minute or two when the Dow went from about 300 lower to 1000 lower and back up to 350 lower. I bought the 50 shares of APPL at $243 on the way back up from $200. Who knows? My trade may not be allowed either.
This will be one fascinating investigation :surprise: .
The speculative shark pack is hungrily attacking the Euro by focusing on well selected objectives in turn, building up investor panic and getting a valuable collaboration from not-so-clear credit rating agencies and media (always those of Mr Murdock in the cutting edge). The philanthropist Mr Soros (and others) has great experience in doing this. The successful attacks against the Sterling Pound, Peseta, Yen, etc., in the Nineties avail it. Oh, and the hesitant and slow reactions of EU politicians are of great help as well.
I can understand any intelligent fellow could made good profits of the peaks and downs by being very attentive and agile in the market convulsion concocted by the big speculators. If not, one can only seat and wait, and expect too that one's particular and collective (as a national group) interests are not irreversible damaged as a 'collateral' result.
It seems to me as if the recent financial crisis has been for nothing. Some market regulations are clearly needed, IMO. There is too much at stake.
Regards,
Jose
You got that right Jose!!!
TM
BTW, how many times have I stated something about the market the past few months and the opposite happens? The ironic thing about it is that on several occasions, I was half kiddingly advising people to take the opposite view. For example, it was early this week when I said , we may have seen the low on the correction. I then said in jest, "that means sell everything". If only I had listended to my own advice
Not buying... just holding my dividend-paying stocks, and some of them actually went up today... which shows that others are buying them as a flight to safety.
how many times have I stated something about the market the past few months and the opposite happens?
Hahaha... That happens to all of us from time to time... but the more important question is whether or not you feel confident and that you understand your investment decisions. I say this because I have posted at one time that the formula for beating the averages is to follow certain rules... one of them is that you totally understand your investments and feel good about them. If you don't feel good about a stock and understand that stock, then you shouldn't own it. If you don't feel like you understand the market, then you have no real business being in it.
That's why I am out, with exception of the divident-paying stocks. I was deeply invested in the market when I understood what I was doing. I felt condfident that I could make successful money-making decisions. But this current market is too unpredictable and irrational. I do not know what I am dealing with well enough to make a decision that would assure me of a successful outcome.......... not yet.
TM
You are correct that the mess may continue for a while, we must be prepared to take the ups and downs if you want to be in at these levels.
Since the market is so unsteady, I decided to spend a little cash last week and bought a new Harley. My wife won't let me add any other cars and I've always wanted a bike so I just went for it. I'll bet it holds it's value better than many of the stocks in my portfolio, and it is a blast to ride - can't do that with any stock.
Good for you—and for pushing ahead the industry!!!
I guess many big speculative sharks are now buying a few Euros (getting on counter tendency in the shadow)!
Regards,
Jose
I don't trust him... and personally think he is kind of dangerous and threatening to the world's financial stability, and has his own overly-selfish agenda. In a similar way that Dick Cheney was (is?) dangerous and threatening to the world's political stability, and operated primarily with his own narrow-minded self-serving agenda and a disturbing disregard for humanity at large. :sick:
It's a shame that only a handful of powerful people can do so much damage to the billions of people in the world, or worse yet, do nothing for them at all.
I have my doubts that there will be any serious financial reform package that will come out of Washington. Any final legislation will be quite watered down, IMO. I think history proves it is much more likely that we wil continue to see corruption, perhaps in new ways we haven't even seen yet.
Let me put it this way... as the rules change, there will be new ways to break them.
In spite of all of that, the U.S. stock market is still an amazing institution for investing. Unfortunately, it has risks that are not solely based upon the quality of the companies comprising the indexes... instead the risks also include the behavior and decisions of powerful people that can unfairly and inappropriately manipulate the markets politically and financially.
Jose, how are you?
TM
I fully agree with you, TM. Not only with the quoted sentence but with the entire post. One can just complain a bit about the wild but has to fight the lions nevertheless.
Thank you for asking about my recovery. I still cannot walk or stand on my feet in order to consolidate as much as possible the pubic and sacroiliac joints that were damaged and surgically operated (I broke also a [bone] isquiopubic branch). In particular the pubis needs to be very solid before applying charges and tractions on it. Therefore my physical therapy is by now limited to move my legs while seated or in bed. I too use electric stimuli with one of those fitness stimulators. Then, I read, I listen to the music, I watch TV, I use the computer a lot, I pretend I'm using my muscles, and I await while burning in impatience.
One thing I have read these last days which I found very interesting indeed is the recently published news on Neanderthal ascendency in modern eurasian but not african [non-permissible content removed] sapiens. As a brief: http://cosmiclog.msnbc.msn.com/archive/2010/05/06/2295639.aspx
Regards,
Jose
PS: I apologize for the medical jargon.
In other words, I wish a demise of the EU as it stands now. Europe can be united and peaceful without sovereignty-stealing legislation and economic irresponsibility.
Moreover, asset allocation, not individual stock or bond selection, predicts 80% of one's return.
In other words, spend most of your time and effort on asset allocation and then buy and hold.
I get a kick out of the fact that the personal finances of top level Wall St types are usually very undiversified and over leveredged with predictable results. Didn't Bear Stearns Jimmy Cayne have most of his money in Bear and just two weeks before it imploded he bought two adjoining condos at The Plaza?
I read yesterday or the day before yesterday the article you quote.
I wished Mr Köhl was in power now instead of Ms Merkel to better deal with the current situation. Mr Köhl, being a German conservative also, had much more insight than Ms Merkel, as other previous Chancellors (e.g., Mr Adenauer or Mr Schmidt) had. Ms Merkel has been short-sighted and hesitant on applying the economical measures needed to help Greece (and the EU, it encompassed Germany). Until the German banks and other German influential people have not remembered to Ms Merkel that there is a lot of German money at risk, and that 80% of the German industrial export is bought within the EU itself, she has not reluctantly taken the definitive step.
Others have also remembered to Ms Merkel that as recently as three/five years ago it was Germany, with the assent of the remaining EU, which had a public debt well above of that allowed by the EU regulations. That debt was caused by the German reunification, and used to stimulate the East-German economy, in the same manner that some South European Countries have fall in debt to stimulate theirs after the recent financial crisis (not the case of Greece, I'm afraid, which was making up its finances with the help of Goldman Sachs among others).
It has also being remembered that Spain and Portugal were pointed to as 'modelic' Countries in terms of public debt since the Euro was introduced (2002) until the recent crisis. Also, that South European Countries were in favor of German reunification while Ms Thatcher and Mr Mitterrand where secretively speaking on how to avoid it. This was publicly acknowledged by Mr Köhl to Mr Gonzalez, former Prime Minister of Spain. This is politics, but is the sort of politics that a German Chancellor should weight when being reticent in helping the 'lazy' Southerns.
As you may know, in my life I have stayed for years in England, France and Germany in addition to Spain. I've paid frequent visits to most of the other European Countries. In every place I have met excellent, good, not so good and bad people. So I was happy everywhere, not finding any reason in order to divide Europe in good-working arius and the rest. In which I coincide with you, may be, is that the EU should be composed of nations well in favor of the Union, not only because of some economic advantages which are evident only in times of bonanza. If you are not for good and bad, better not to be in any time.
Regards,
Jose
I find it funny that nations like France or England thought they should have any say in German unification - look how they have managed themselves over the past few decades. It always brings me back to the old song lyrics..."you can't even run your own life, I'll be damned if you'll run mine" :shades: . Germany received significantly less ERP funds than France or England, yet has dominated both of them economically and industrially for some time. And if it wasn't for Germany right now, the EU would be in serious danger of a complete economic collapse. IMHO, France and England have been off course for a few generations. If all of Europe had even a half-baked German work ethic, it wouldn't be in the trouble it is now.
Should Germans have to work harder so others can have easy lives? Did Germany not export to other European nations before the EU was created? We both know the answer. I don't accept the thought that because Germany owes everything to the EU because of exports, that such a bailout is obligatory - if this material wasn't bought from Germany, who else would provide it? Surely there are good people everywhere, but some areas are going to be on the dole forever unless they are forced to actually get to work.
I think every EU nation should hold a referendum about whether to continue the union for anything but trade. Participation should be at the level of the Swiss, at most. Criminal legislation, broken freedom of speech, immigration, and so on should not be dictated by a group of idiots in Brussels. If the EU keeps evolving in this manner, Europe is going to have a dim future, and a stagnant or decaying economy - especially when the US is finally unable or unwilling to defend it, and the region is forced to pay to safeguard itself from the menace to the east. The EU is quickly becoming kind of a EUSSR - more and more unwilling members forced under an umbrella managed by zealots who will do anything to keep their personal money factory alive. A weirdo mix of Soviet and fascist overtones.
All of that being said, I hope the Euro continues to decline in value and remains depressed for some time. It will both aid in the global export market, especially for German products - and it will make more people in Europe question the structure and sustainability of the alliance itself.