Week 53 Update

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Weekly Activity
$150 deposit into Investing
$78.34 deposit into Trading
$25 bonus money from Sharebuilder for savings
$1.75 dividend from ERF
$1.16 dividend from PCY
$0.11 Interest from the Investing accounts cash position


Model Portfolio Totals

Trading Account: $1,347.96
Estimated Monthly Income: $0 (Not ready to trade until Phase 1 completed)
Max loss per trade (1% of account): $13.47
Portfolio stop (3% account): $40.43

Investing Account: $2,913.77
Estimated Monthly Income: $10.44 ($0.243 from DRIP)
Stock
     ABT: $0.76
     AFL: $0.63
     WMT: $0.59 ($0.007 from DRIP)
Energy
     COP: $0.77 ($0.007 from DRIP)
     ERF: $1.77 ($0.078 from DRIP)
REITs
     O: $1.09 ($0.031 from DRIP)
BDCs
     TCAP: $2.01
Bonds
     JNK: $1.68 ($0.080 from DRIP)
     PCY: $1.15 ($0.035 from DRIP)
Maneuvering Cash: $750.11

Savings Account: $1,425
Emergency: $1,000
General/Car Fund: $125
Portfolio Protection
     Trading Account: $50
     Investing Account: $250



Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Stop with the 43% dividend tax

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

So I am not quite sure how there can be complaints about the loopholes of the tax system and then at the same time talk about the theoretical maximum on a small population of the party reflects the nation as a whole.

Note that I am not taking a side in if it should or should not be raised. That's a personal political opinion. My only points in the video is that its not going to be the death of dividends.


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Data drives action

So what do you do with your research and due diligence...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Its certainly a fine balancing act.  On one hand you have to do enough research to get a good feel and a good confidence level of what you are analyzing and researching. On the other there will be a point where you have to stop and just accept the results as what they are. Not taking action is a completely valid conclusion. The important thing is that you move on to the next thing.

Why is this so important for us to keep in mind? There are thousands of companies out there. Each with years or decades of earning reports and investor meetings. Each with hundreds of articles of other bloggers and investors ideas on them. If we focus for one for too long we could never get to a better one to select.
Trading is similar in that you have dozens of forex markets, dozens more futures commodity markets. Multiple time frames and hundreds of tools. Hundreds of different traders out there sharing their strategy. By the time you are done researching, your trade is over and you get to start again.

How does one find the right balance? Its going to be different for each of us and you just got to jump in and start your analysis. I do not think its a static amount of research for the same person. Some companies I have found it very easy to analyze correctly (long term profitability for my portfolio). Others took a long time before I hit a point I could trust my findings.


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Week 52 update

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Weekly Activity
$100 deposit into Investing
Started Savings Account at Sharebuilder for the Car fund (0.8%).
$25 bonus from Sharebuilder for savings account
Changed Investing Account Savings from Money Market (0.03%) to FDIC Savings (0.5%)


Model Portfolio Totals

Trading Account: $1,269.62
Estimated Monthly Income: $0 (Not ready to trade until Phase 1 completed)
Max loss per trade (1% of account): $12.69
Portfolio stop (3% account): $38.08

Investing Account: $2,877.95
Estimated Monthly Income: $10.42 ($0.223 from DRIP)
Stock
     ABT: $0.76
     AFL: $0.59
     WMT: $0.59 ($0.007 from DRIP)
Energy
     COP: $0.77 ($0.007 from DRIP)
     ERF: $1.75 ($0.063 from DRIP)
REITs
     O: $1.09 ($0.031 from DRIP)
BDCs
     TCAP: $2.01
Bonds
     JNK: $1.68 ($0.080 from DRIP)
     PCY: $1.15 ($0.035 from DRIP)
Maneuvering Cash: $600

Savings Account: $1,400
Emergency: $1,000
General/Car Fund: $100
Portfolio Protection
     Trading Account: $50
     Investing Account: $250






Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

New Investment Aflac (AFL)

I have a new investment for the Model Portfolio to share...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

The investing side of an insurance company is where they make their money. Thats how Warren Buffett really fueled the growth of Berkshire Hathaway, they own Geico. That might bring up the question, why would I want to invest in a company that invests in other companies? Wouldn't it be better if I just bought the investments directly? The answer is that I don't have access to a lot of things. Insurers like AFL can pick up private investments and private bonds not available on the open market. They will also have teams of researchers to find good investments. I think thats a fair deal. I give them money and they give me a 3% yield that they increase by 20% a year. Now they won't be able to keep pace of that growth but heck I'll take a 10% raise to my income.

In the first image look at the total return over the past 10 years vs the S&P500. 10.1% vs 3.8%. I have to laugh every time I hear someone tries to tell me that dividend paying companies cannot give big returns because they aren't innovative. Their reasoning being that companies pay dividends when they are out of ideas for products.

Another key take away is the upside potential. The black line is the actual share price. The orange line is the earnings based fair value of the company. AFL's business has grown in huge leaps and bounds and the market is not paying attention.

While dividend stocks can outpace growth stock in the capital gains category they can also beat bonds at the income game.  As shown in the second image, over 10 years the actual amount received from dividends will double. Treasuries in comparison are flat and we end up getting paid over twice total amount that bonds pay.

Images from Fastgraphs.com


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Week 51 update and savings

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Weekly Activity
$100 deposit into Savings
$1.65 dividend from JNK
$1.09 dividend from O

Model Portfolio Totals

Trading Account: $1,269.62
Estimated Monthly Income: $0 (Not ready to trade until Phase 1 completed)
Max loss per trade (1% of account): $12.69
Portfolio stop (3% account): $38.08

Investing Account: $2,775.39
Estimated Monthly Income: $9.80 ($0.223 from DRIP)
Stock
     ABT: $0.76 income/month
     WMT: $0.59 income/month ($0.007 from DRIP)
Energy
     COP: $0.77 income/month ($0.007 from DRIP)
     ERF: $1.75 income/month ($0.063 from DRIP)
REITs
     O: $1.09 income/month ($0.031 from DRIP)
BDCs
     TCAP: $2.01 income/month
Bonds
     JNK: $1.68 income/month ($0.080 from DRIP)
     PCY: $1.15 income/month ($0.035 from DRIP)
Maneuvering Cash: $750

Savings Account: $1,400
Emergency: $1,000
Portfolio Protection
     Trading Account: $50
     Investing Account: $250
CDs: $100


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Forex trading review 4-13-12

A Friday the 13th appropriate update to my Forex trading...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Well it was intended to be quick and then ended up being a 15 minute video.

Numbers wise, I am off to a terrible start but to be honest, I couldn't be happier. Well I would with profit lets be serious but in analyzing my first couple trades, I am doing the right things at the right times with the information I have in the moment of the trade. As I mention in the video, that will be the key to success. How can I be sure though? Lets look at other industries...

You have your professional athlete on any team sport. Baseball, Football, Soccer, Hockey, they are all the same. Yes an athlete can read the play book and memorize it but put them on the field in front of tens of thousands of viewers and the opposing team running at them and.... oops the other team scores.
The player then goes back to review recordings of their play and they can tell themselves they wont make the same mistake again. Next game they keep making the same mistake.

As traders and investors we will be put in front of a lot of potential oops moments. You can read all the technical analysis books from the safety of a comfortable chair and your favorite beverage. Will you remember that point of wisdom from chart 48-B on page 212? Or will you lose 5% of your account?

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Shareholders are owners of a company

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

As I mention in the video, this discussion comes up a lot unfortunately. That shareholders are not the owners of the company. I see the (failed) logic that the CEO and board are in charge and run things. Shareholders are to sit back and keep their mouth shut because management knows the company better then us. Knowledge of a company doesn't stop people from investing in it nor from being hired for the board.

Another example are lawsuits. BP Prudehoe Bay (BPT) is a popular oil royalty land trust for the North Slope of Alaska. Another company caused damage to the pipeline and it had to be shutdown. BPT sued for loss of income and damages and won. Being a royalty land trust and no real capital use for the money, it was passed onto the unit holders in an extra large dividend.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Week 50 Update

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Weekly Activity
$100 deposit into Investing
$1.73 dividend from WMT

Model Portfolio Totals

Trading Account: $1,269.62
Estimated Monthly Income: $0 (Not ready to trade until Phase 1 completed)
Max loss per trade (1% of account): $12.69
Portfolio stop (3% account): $38.08

Investing Account: $2,808.98
Estimated Monthly Income: $9.78 ($0.209 from DRIP)
Stock
     ABT: $0.76 income/month
     WMT: $0.59 income/month ($0.007 from DRIP)
Energy
     COP: $0.77 income/month ($0.007 from DRIP)
     ERF: $1.75 income/month ($0.063 from DRIP)
REITs
     O: $1.08 income/month ($0.027 from DRIP)
BDCs
     TCAP: $2.01 income/month
Bonds
     JNK: $1.67 income/month ($0.070 from DRIP)
     PCY: $1.15 income/month ($0.035 from DRIP)
Maneuvering Cash: $750

Savings Account: $1,300
Emergency: $1,000
Portfolio Protection
     Trading Account: $50
     Investing Account: $250
CDs: $0



Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Psychology of Emotions: 7 - Hate

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

With listing hate separate from anger does it seem like I am nitpicking here? Can't I just say "Don't get emotional with your trading and investing?" I could but that would do nothing.

As I mention in the video, to overcome a problem we have to address its root causes. Have you watched a friend or family member deal with a problem and they come to the wrong conclusion? They then proceed to spend a lot of energy and time working on fixing the wrong thing. All the while you are watching and knowing it will do them no good because they don't get it. That's exactly where we can find ourselves with our financial activities.

This is especially dangerous when we are starting out. For example on various forums and communities I will see a person talking about a stock, "Why did we have this massive drop today? What happened? Whats wrong?". Upon checking the price of dropped from $40 to $39.60... 1%.
Whats wrong is that they are new and not used to price changes yet. Or possibly they are looking at a daily chart where that 1% drop moved across their entire screen making it look scary.

Why is this a dangerous time? As they look for answers they will encounter other emotionally driven investors.
"It dropped because congress is using insider trading to work with Wall Street to manipulate the market!"
"The 1% stole your money its all a Ponzi scheme!"
Here we have a combination of Hate shifting blame and Anger helping to point the finger at mysterious figures.

My answer to these new investors (and traders) "Why did it drop? Because it did. 1% drops happen and it happens a lot. There is no way we can tell exactly why but we can prepare and plan for it to happen again."

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Week 49 update, Intelligent Investor, and Starbucks

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

In the video I made a statement that needs clarification. I said you do not own stock because of future growth. Then later on I talk up Starbucks future growth as a reason I want to buy it. Isn't that contradictory?   Future growth is important but if you are a capital gains investor and you feel it is overpriced then you might want to consider selling. If the chance of future growth is the only reason to buy then go buy AMZN at a 146 P/E or CMG at a 61 P/E. Price is also a big concern because if they don't hit that expected growth? You find yourself in a position that NFLX investors did in July 2011 when they were a 71 P/E.


Weekly Activity
$100 deposit into Trading
$1.15 dividend from PCY

Model Portfolio Totals

Trading Account: $1,269.62
Estimated Monthly Income: $0 (Not ready to trade until Phase 1 completed)
Max loss per trade (1% of account): $12.69
Portfolio stop (3% account): $38.08

Investing Account: $2,744.00
Estimated Monthly Income: $9.78 ($0.205 from DRIP)
Stock
     ABT: $0.76 income/month
     WMT: $0.58 income/month ($0.004 from DRIP)
Energy
     COP: $0.77 income/month ($0.007 from DRIP)
     ERF: $1.75 income/month ($0.063 from DRIP)
REITs
     O: $1.08 income/month ($0.027 from DRIP)
Bonds
     JNK: $1.67 income/month ($0.070 from DRIP)
     PCY: $1.15 income/month ($0.035 from DRIP)
Maneuvering Cash: $650

Savings Account: $1,300
Emergency: $1,000
Portfolio Protection
     Trading Account: $50
     Investing Account: $250
CDs: $0


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.