Investing Poll

[jx2]

Originally Posted by ryberg

Well I think their point is that while that might be the case, you might nevertheless be happier -- usually several points happier, in fact-- than somebody who had a managed mutual fund focused on the Nasdaq then. Or that is to say, their point is that managed mutual funds really by and large just suck.

Index funds are not their top pick overall. Indeed the stock market isn't their top investment pick overall, if you've got a new small business you're starting up, for example, or other such things. But they're clearly their top pick for those who again may not have the time, energy or inclination to do all the research themselves. A sort of way out between that as a rock and mutual funds managers and fees as the hard place.
Steve

No matter what way you decide to go, some research should be done. As for mutual funds, it makes a huge difference on how much you have to invest. Fees or types of funds you qualify for depends on how much investment to start. For example : (a $250 investment would cost us 7% up front sales fee, $100,000 investment cost 3.75% and a $250,000 investment cost 2.5% and over a million is free).We just found an investment advisor through our local bank( a subsidiary). The funds we invested in have a great track record for the last 33 years with close to the lowest fees. This portfolio we have is very diversified and therefore in the medium risk category. Sure you may get 25+%, but for the most part you will have a far higher risk factor, and we are not willing to take that risk.
I am not shy regarding our investments so here is where we have ours. We have a combo of 3 different American Funds. Google it ( it has never paid less than 12% over a 10 year time frame). That is all it will take to satisfy our needs.

Happy Investing.

Edit: also what class of funds you get makes a big difference on the fee structure.

[smachim]

From an insider point of view: I hardly would take a broker advice without double-checking myself. Although is a very regulated business, their bonuses is based in their revenues. And their objectives not always match yours.

The first questions you have to answer are what is your investment profile (with what portfolio are you able to sleep at night), your time horizon (when will you need the money) and your tax situation.

Afterwards you can start making decisions, but never invest in something you don’t know about just because is “popular” or your friend told you. Tips are great… to start doing your homework.

There are good mutual funds (Latin American funds had performances of over 30% pa in the last years) and bad funds. And the same happen with bonds, shares, etc.
Also remember that with a depreciating US$ (if that’s your thought) anything invested abroad will yield at least the currency appreciation of the underlying.

[jx2]

Originally Posted by smachim

From an insider point of view: I hardly would take a broker advice without double-checking myself. Although is a very regulated business, their bonuses is based in their revenues. And their objectives not always match yours.

The first questions you have to answer are what is your investment profile (with what portfolio are you able to sleep at night), your time horizon (when will you need the money) and your tax situation.

Afterwards you can start making decisions, but never invest in something you don’t know about just because is “popular” or your friend told you. Tips are great… to start doing your homework.

There are good mutual funds (Latin American funds had performances of over 30% pa in the last years) and bad funds. And the same happen with bonds, shares, etc.
Also remember that with a depreciating US$ (if that’s your thought) anything invested abroad will yield at least the currency appreciation of the underlying.

Ya... what he said . Good advice

[roni]

I agree. We have a pot in pretty safe investments (mutual funds), a pot managed by others and a pot in which we assume a bit more risk. We have done pretty well all three of these over the past years - but when I first started making some investment decisions for myself, I made a lot of mistakes - but I figured I would and didn't put much at risk.

Another thing we have that many no longer do are some solid defined benefit pensions. One reason I rolled my State University Retirement System money from Illinois to an IRA is that the system was underfunded. The three remaining systems are stronger (Oregon PERS x 2 and Missour State Employees)

I now call it those early investing decisions paying tuition .

[roni]

Also, as we all know, there are quite a few folks on playa.info who have done all right buying property in Playa. Mebbe we'll hear from some of them before too long.

[southbound]

Originally Posted by roni

Also, as we all know, there are quite a few folks on playa.info who have done all right buying property in Playa. Mebbe we'll hear from some of them before too long.

Not a single one of my investment advisors thought it wise for me to buy the place in Playa. I have a feeling, though, it will be the one investment that I reap the most benefit from (not necessarily all monetary).

[jx2]

Originally Posted by roni

I agree. We have a pot in pretty safe investments (mutual funds), a pot managed by others and a pot in which we assume a bit more risk. We have done pretty well all three of these over the past years - but when I first started making some investment decisions for myself, I made a lot of mistakes - but I figured I would and didn't put much at risk.

Another thing we have that many no longer do are some solid defined benefit pensions. One reason I rolled my State University Retirement System money from Illinois to an IRA is that the system was underfunded. The three remaining systems are stronger (Oregon PERS x 2 and Missour State Employees)
I now call it those early investing decisions paying tuition .

A pot managed is a good thing. Some indexed mutual funds are not managed, therefore you have nobody to get in or out of good or bad stocks.

We also have Oregon PERS and Julie has a 401k with maximum contributions. Like Jacko said, it is pretty stupid not to take advantage of any employer contributions(it's free money).
Our 3 managed funds we have invested in hold a total of 693 different stocks. That's diversification.

Looking at 2018 for retirement

[ryberg]

Originally Posted by jx2

A pot managed is a good thing. Some indexed mutual funds are not managed, therefore you have nobody to get in or out of good or bad stocks.

Not sure that I follow you. As far as I know, every index fund is by definition managed in the sense that an investment is automatically distributed over the companies in that index and weighted to those companies' respective values in that index. So you buy the Vanguard 500 fund and their program "manages" it to the extent that you have bought essentially an appropriately weighted share of each company in the S&P 500, more or less, which is to say that you've more or less bought an appropriately weighted piece of the U.S. stock market. That in turn means that it doesn't really matter if you've got some money in a bad business in that index, because that's like complainin that you've got some money in a particular company and one department of that company is losing money even when the company overall is profiting. I mean, you buy the that index and let's say AT&T or CAT take hits, you've still got Microsoft and Boeing and, well, about 500 others that are breaking even or doing well. Unless the stock market tanks, you're not going to tank. And the stock market, as measured by the S&P 500, at least, has done quite well for quite a long time.

What's impressive is how consistently this type of management (or whatever you want to call it) outperforms what we normally think of as management in the regular mutual fund sense, meaning one or more guys sitting around in conference rooms gambling with your money, essentially, and also collecting much heftier fees for doing so (since of course once the programming on an index fund is in place, you're essentially done with the labor aspect of it). I think the index fund idea answers the question your comment begs: who's determining which are the stocks to get into in the first place, and how good are those choices? There seem to be precious few regular mutual funds, indeed, who can match index fund returns, given what I've read (though of course you will get variation depending on the mutual and index funds you compare).

However I have the impression that mutual funds are like congressmen: people may not have a hard time with the idea that their performance by and large may be crappy, but people almost always have a hard time accepting that their own's performance might be crappy.

Steve

[roni]

Originally Posted by jx2

A pot managed is a good thing.

Looking at 2018 for retirement

Ours managed-by-others pot is the Individual Account Plan (IAP) part of the Oregon Public Employee Retirement System. The Oregon Investment Council manages it along with the other, much larger multi-billion dollar pot of investments.

We were looking at 2009-10 for retirement. Now it depends on how rapidly research progresses on treatments/cures for Kathy's eye disorder. We'll probably hang around and work longer to maintain good insurance etc.... for a few years beyond that.

As long as we're having an ok time doing it, why not?

[Dale]

Originally Posted by roni

So, what does it mean to "bork"?

BORK - to have one's character assasinated;
as in the treatment by the U.S. Senate Judiciary Committee of Supreme Court Justice nominee Robert Bork.
You sure got borked on that deal.
But Noooooooooo........ I don't want this to turn into a political thread!!!!!
.
This is the best off topic thread you have ever started Roni!
Personally, I have done well with individual stocks and a couple of mutual funds and real estate! One good stock over the last 18 months has been Homex (HXM), home building in Mexico!

[roni]

Originally Posted by Dale

[
This is the best off topic thread you have ever started Roni!
Personally, I have done well with individual stocks and a couple of mutual funds and real estate! One good stock over the last 18 months has been Homex (HXM), home building in Mexico!

I recommended HOMEX to people back when it was below $25 - I sold at around $32 and never bought back

I have done well with Apple (AAPL) in our self-managed accounts. Bought at a split adjusted $7 before our first trip to Playa in May 2003. Wish I had held on to all those shares since then

[roni]

One important point I want to make

It is why I thought for a long time before starting this topic. People are mentioning specific investments. jx2 has, Dale has and I have - probably others as well.

If any of you should happen to invest in a particular company or fund solely because it was mentioned here - that is your decision.

If that decision does not turn out well - it was still your decision. Do your own research, go to your ouija board, consult the tea leaves, talk to your financial advisor, read entrails - do whatever you would normally do - but do not come back here whining cause something you invested in that you read about here did not turn out so well.

[Jacko]

Good point...I have heard that the blindfolded monkey with a pin does as well as most stock brokers working really hard to pick the best stocks. Its important to realize, no matter how you voted...You are ultimately on your own out there!

Diversify across mutual funds (which are already diversified (mostly) by their very nature)- Low Cap, High Cap, Bond funds, Internationals, Value, taxable and tax-free...... and dollar cost average. Generally stay away from individual stocks unless, you either know the company really, really well, you like to gamble and/or you have a LOT of money.

For me, keeping it as simple as possible is important....5-7 mutual funds in the categories above.

Thats about as good as its going to get from what I can see.

[jx2]

Originally Posted by ryberg

Not sure that I follow you. As far as I know, every index fund is by definition managed in the sense that an investment is automatically distributed over the companies in that index and weighted to those companies' respective values in that index.Steve

What i was trying to say was.... Some mutual funds have a certain portfolio of stocks that they have money invested in and there is no one that is constantly watching the invested stocks. So, if some stocks in the portfolio go bad or news of such happenings in the near future, there is nobody there to get rid of it, and vice versa. All mutual funds are distributed, but not necessarely sp? managed on a day to day basis by a real person. This seems scary to me, but they are out there. Not sure about the indexed thing

Edit: The yardstick that matters
With so many mutual funds available today and so many ways to measure them, it’s easy to be confused. But at the end of the day, the only thing that matters is whether your fund is helping you reach your goals.

Your financial adviser can help you determine whether your funds are measuring up to your financial goals.

[horizon200]

When I first retired from the AF, I worked an engineering firm that makes the Space Suit. The Program Mgt office had a lunch table where we would all sit around talking investment strategies. After laying out what they wanted to retire with and how they planned to get there, one guy looked at me and asked..."So what are you doing for retirement?" I replied...Ummm I'm drawing it!" Sorta knocked him back on his heels that a 36 yr old would be drawing retirement already. After I let him chew on it a while, I explained the rest of my strategy for when I eventually do fully retire. But the look on his face was priceless!

I have until 2019 for my full Civil Service Retirement and whatever is available from Social Security. We'll see!