DawgTalkers.net Forums DawgTalk Everything Else... Let's talk investing

Well, over the past few months I've been doing a lot of researching, reading, self-learning, and frequenting some pretty good websites about investing and saving for the future. As of today, I have officially started my own little portfolio!

I had about $2,600 to spare thanks for my wifes poorly performing mutual fund, so I talked her into ditching the low growth/high expense fund and let me use the money to start trying to get some decent returns. We have enough in our saving and checking accounts to feel comfortable, and we never saw that money anyways so it's not like we're going to miss it.

I'm excited to start building a nice little portfolio, and plan on saving ~$500 every four months to start adding positions and to continue to diversify. I'm also maxing out my Roth IRA as well and paying off student loans. Continuing to max out that account is my main priority, but I'm making more effort to keep adding to my brokerage account.

I haven't put any money into anything too risky yet. Coca Cola, Berkshire Hathaway, Disney, etc. are main companies. One of my positions has a little more risk to it, but I feel good about it. I'm proud to be part (albeit very small) owners in these companies. I have no plans or ambitions of day trading, or being a trader at all. My philosophy is to buy shares of good companies with solid track records and good management, and hold on to those shares for as long as possible.

Sooooo, I come to you guys for advice. There is a lot of life experience on this board, and I'm hoping some of you can share it with me. Big mistakes? Best buy you've had? Shoulda coulda woulda stories? General advice on investing and saving? Personal values you adhere to?

And, if anyone is comfortable with it, we can share ideas about companies that we either have stakes in, or companies we think might be taking off or about to tank. etc.

Basically, I just want to have some dialogue about investing. Most of my peers and immediate family aren't into it, or don't know too much about it...so I'm left with the dawgtalkers (don't laugh at me). It's something that has peaked my interest, and I want to continuously learn about it as it's something that I will probably be involved with for most of my life.

I'll just say this much. I wouldn't hold onto paper in any form really except for maybe ownership deeds.

However, I wish you good luck in your endeavors. If the economy doesn't implode, you might be alright. If it does, however, you might lose every bit of that money you're investing.

Although, $2600 may not seem like much, it's certainly a good deal of money by most people I've come across and most of them would miss it if it was 'lost'.

Again, I wish you luck.

I would like to buy an A share of Berkshire Hathaway one day (hopefully in the not too distant future!) and attend the shareholders conference in Omaha.

It's currently trading at $132,700.00 a share.

As far as advice don't do anything silly...and keep adding as often as possible.

If I was not a savvy investor I'd just invest in SPY and not worry about it.

I was about 10 when my father introduced me to the stock market. Bought 100 shares of Hammond Organ at $7. Shortly afterward, the stock went to $14. I wanted to sell, my dad said "no, hold onto it." It dropped to below $2. Then someone wanted to buy the company and take it private, they offerred $10 per share. I wanted to sell, my Dad said "no, the company is worth more than that." The buyer got 51% of shares, then made an enforced buyout of $7 per share. You could say I broke even, but after 3 or so years, I lost money due to inflation and lost interest. Several years later, after a lawsuit, the new owner was forced to pay an additional $3 per share.

Took the $700 and invested in Kimball Piano company. (this was an industry we were deeply familiar with). It grew to over $17 when I turned 18, and sold. Within a year, the value was over 24.

If I had sold Hammond at 14, re-purchased at two, sold at the first offer of 10, then bought the Kimball as 7, and waited until it hit 24, my $700 would have turned into approximately $50,000 at age 19.

Virtually none of these value changes had anything whatsoever to do with the profitability or viability of the company in question, it was all about the PERCEPTION of the value of the company.

Short version - Stock market is a HUGE crapshoot. Look at it like gambling, there is NO SUCH THING as a sure bet.

I am invested in a couple of different mutual funds and I'm pretty happy. I have a mixture of medium growth and aggressive growth funds that aren't doing too bad.....certainly compared to the savings account where my money was originally with it's pitiful .25% interest. Is it a risk, yes, but I can easily survive a down year and still come out way ahead comparatively.

I don't have the time or energy to always be watching the stock market so I couldn't go that route, but even in a bad performing year my mutual funds average about 7%. The Rule of 72 says that even in bad years, my old average time for my money doubling was 280 years versus about 8. It is a much better option than the old savings account.

Just for me.....

Worst investment ever: WorldCom. The stock kept going down and I kept "catching the falling knife." Added and added because the numbers just looked to good for the stock to be so low. Short story, they were to good to be true. Bernie Ebbers. Wiki that SOB. Here is an excerpt:

"In 2005, he was convicted of fraud and conspiracy as a result of WorldCom's false financial reporting, and subsequent loss of US$100-billion to investors. The WorldCom scandal was, until the Madoff schemes came to light in 2008, the largest accounting scandal in United States history. He is currently serving a 25-year prison term at Oakdale Federal Correctional Complex in Louisiana."

I lost most of my portfolio dollars back then.

Anyway, Vanguard funds are low cost so I have money in those. I own some high yielding dividend stocks that have been strong companies for decades and not the next big thing. Although, at one time I bought 300 shares of a young computer hard drive manufacturing company back in the 90s. I bought at $7 and sold at $18 as I recall. Stock went all the way to $80 in short time. I never got back into it, but I watched it go from $80 to a penny stock in about 2 years.

My advise would be go with mutual funds and pick 12 -15 stocks in companies you like and put them on a Yahoo or Google watch list and do just that. Watch them for a year or 2, read the news for them and watch the charts (learn some technical analysis) to get a feel for them. I have some I have been watching for 5 -8 years that I just got into and out of.

Just my $0.02

I have a financial advisor that manages my investments. He knows his stuff and is very much about educating me on decisions and recommendations.

He is free to call/consult and he schedules regular meetings with me to review my portfolio. He even drives to my part of town to meet!

Because his company makes their money from a percentage of my portfolios worth and not consultations, etc....they know what they are doing to keep their customers portfolios healthy or they would not make money.

Without getting into all the flavors of the month stock stuff Let's just say spread your $$ around. Watch out for expenses, try to avoid 1% or more. Vanguard has low expenses and a wide choice of mutal funds. If you really want stocks, In this day & age, Then I would stick with Big Co.s that have always paid Div. Like PG or Colgate-Palmolive. Campbell soup has always been a fine Co. in down times. Also Beer Co.s tend to do well in bad times. I have $$ in Inflation-protected funds also. Spread it around. PRPFX is a good fund also, it brings you into gold and silver as well as stocks and Treasurys and is below 1% expenses. Also I have a little in TGCFX, a Income fund. Now I'm not gonna get rich with these funds, but I'm not gonna lose my shirt like I did in 00 - 01. Took about 5 years to get back to where I was. Now I have a 70 - 30 mix. On the safe side. Just where I like it

Most of my funds are through Invesco/Van Kampen. My financial adviser works the same as yours. In fact, they are required by their business model to invest in many of the funds that they are recommending their customers into, plus it doesn't hurt that my agent is also a good friend and colleague.

I've been trying to get started with investing, but possess a lot of knowledge about it so I don't know where to start. I feel overwhelmed and then i shy away from it. I definitely need to do something, I got some money in a savings account that got a whopping .25 cents of interest last quarter.

really funny/cool to see this! i've recently become interested in investing, as well. it is SO different from my work, that learning about investing and economics has become a hobby lately...which makes me pretty lame, i guess.

i got interested for a few reasons...1) i realized i'm not willing to make the sacrifices to earn high wages in my field, so i figured i'd better find other avenues to pursue financial stability. 2) we couldn't sell our old house, and after a few intense weeks of research, decided to keep the property as a rental. so basically, i was "forced" into educating myself. and i've actually loved it so far.

i'm personally not crazy about the stock market right now. as someone said, it's gambling based largely on speculator psychology. in my 401K, i have few options, which i hate, but i suppose it forces me to have some more exposure to the markets than i would otherwise...forced diversity, if you will. in an aftertax account, i have traded some individual securities within the sliver of public companies i know a lot about (life science research suppliers). i do like ETF's as a means to gain exposure to a sector without worrying about doing tons of legwork on the fundamentals on particular companies.

but if i could make one suggestion, do not stop at learning about paper assets. industrial commodities, precious metals, real estate, collectibles are all worth learning about.

my general strategy is to understand what is happening from a macroeconomic and geopolitical perspective, and allocate what (little) i have according to that. i have almost no interest in digging into the quarterly statements of company X, or combing through the publications in the IT world to find the next big thing. i know you can make money that way, it just isn't what i'm all about.

One of the reasons why so many middle class people lost so much of their net worths is because they panicked, and pulled their money out of the stock market when it started to tank.

Rich people stayed in and bought on the decline, so they could ride the tide back up and make another fortune.

If someone does a little research then can find out the kind of valuation a company has, their stock price vs earnings, their cash reserves, and so on. Solid companies with cash on hand are going to be in good shape.

I remember many years ago when P&G took this massive hit because of some idiocy about their logo being satanic. Their stock dropped almost by half. People panicked. They sold. I told my boss (who had serious money) that he should buy. I didn't have the cash on hand to get into the market on an individual basis. Everything I has was in funds at the time.

He didn't. It doubled from the point I suggested it to him.

He wanted stock tips after that. lol

good thing i essentially had no money in it yet, or i might have been a panicky victim!

but you bring up a good point about the herd mentality. buy low, sell high seems simple enough. in practice, as many can attest, it is clearly more difficult than it sounds.

as far as valuation being the key, i agree...if you have the patience and interest for it. but like i said, i'm more of the mind to know whether to be in paper, or in other things, depending on the macro climate. right now, i happen to agree with the analysis that the QE "crack" is no longer getting the markets high, and that they'll stagnate awhile, and could even crash, if the Euro dies. of course, if we attack Iran after the election, that would provide the artificial boost that we can't get from true growth.

I definitely plan on looking into different sectors like you mentioned. I just don't even know where to start, nor do I have the funds. Because of my age, I'm pretty risk tolerant. One of the biggest things I've picked up so far is that, baring sonething completely catastrophic (like, the world ending) if the market goes down, it will eventually come back up.

Like Y-Town said, when markets crash (like in '08), it usually looks a lot worse than it is because so many people panick and pull out and then it's a snowball affect. If they'd have simply left there money in, they'd be back to right about where they were, if not better off. If they'd have bought at the bottom or one way back up, they'd be better off today.

I'm not do risk tolerant that I'm going to go play with penny stocks. I plan on researching pretty thoroughly, and picking stocks I plan on holding for 3+ years. I'm afraid that if I get into trading and trying to time the market highs and lows, I'll either a.) get so overwhelmed that I make stupid mistakes because I let emotions get in the way, or b)I probably would out perform the market anyways.

Companies like BRK, MCD, KO, and DIS will (probably) be around as long as I live. Barring a new CEO with a terrible philosophy or the company's failing to adapt and innovate, they should be alright. They've been doing it for decades, so I see no reason why they'd changed in the next couple years.

And while high dividend companies generally aren't making gains of 50% years on end, they're generally sound (JNJ, PG, MCD, PEP, WMT, etc.). Plus, I'm reinvesting dividends back into the stocks, which is a (somewhat) guaranteed return.

These types of stocks will probably make up the majority of my portfolio as I continue to build it. Ideally, id like roughly 15 companies for my portfolio, with 10 or so being blue chip stocks and 5 or do a little more 'risky'. One company have my (and hand) is 3-D systems ( DDD), a company that's one of the leads in the 3-D printing technology sector. Good overall returns past two years, has taken a pretty big hit past couple months as it settles back into its price, and is in an industry that's in it's infancy.

I also like choosing individual stocks and passively managed index funds as opposed to actively managed mutual funds because a) a lot if mutual funds have fees over 1% which adds up big time over time, and b) a majority of them don't even match the S&P 500.
I get a lot if my ideas from The Motley Fool, an investing website. Great resource with a lot of dialogue and different views. I recommend it to anyone that enjoys investing and is looking for a good information and technology.

DNA, I'm with you as my job alone, at the moment, is pretty straightforward with my pay, and it won't get me rich. But, my goal is to be a millionaire my the time I'm 50. That's gives me 27 years to save A LOT of money.

I say a millionaire just have a monetary goal. But really, it's what that money can do for my family is the reason I want it. I want to be able to pay for my daughters education, and any other children I might have. I just opened a 529b plan for her, and am contributing monthly. The cool thing is that people can give 'gift' donations too. I'm hoping I can talk my parents into easing up on all the cute baby clothes (that she'll wear one if we're lucky, and instead throwing that $20 into her college savings instead.

I also would like to able to pay for her wedding as well. My parents helped a lot with ours, and I appreciated it so much because it was exactly what my wife wanted, and I hope I can help my my daughter as happy as Sarah was that night. (I will, however, be pushing for a small wedding like ours, ha!).

I'm very goal oriented, so I try to keep it in mind as much as possible. My secondary goal, is to be an even BIGGER MILLIONAIRE by the time I'm 60ish and looking to retire. That might take a lot of luck, and I'm just praying our country doesn't implode by then.


Do the investors on here find that having monetary goals on here help or inhibit them? Does it make you less risk tolerant because you don't want to lose it? Have you found yourself acting wreck less because you're trying to get it faster?

Like I said, I'm very new to this, but I want to become as knowledgeable as I can. The S&P 500 has historically returned like 9% annually since 1970, including this 'lost' decade. I'd be pretty stoked if I could beat that.

A side note, another thing I've found to be awesome is automatic transfers into my savings account, brokerage account, and Roth IRA. It never feels like I'm missing out in the money because I never 'see' it, and its nice to just watch those accounts seemingly increase with no effort.

*if there are a million typos, apologies. I'm on my iPhone at the tail end of a 16 hour road trip. Now my thumb and eyes hurt.

Wow, didn't realize how long that was. It's gotta be a record length post from a phone.

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I say a millionaire just have a monetary goal. But really, it's what that money can do for my family is the reason I want it. I want to be able to pay for my daughters education, and any other children I might have. I just opened a 529b plan for her, and am contributing monthly. The cool thing is that people can give 'gift' donations too. I'm hoping I can talk my parents into easing up on all the cute baby clothes (that she'll wear one if we're lucky, and instead throwing that $20 into her college savings instead.

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sorry to go off on a tangent, but this is interesting to me. i have 2 youngins, and have decided for the time being to stay out of college savings plans. i don't argue the advantages or anything, but i honestly wonder whether college will exist in any similar format to today. i mean, if you want to be a doctor, or something for which institutional education is a requirement, fine. but for many careers, i think its plausible to think that a university degree vs. 4 years of work experience + independent learning is not a winner. in part because of that, i'd rather invest that $ elsewhere. probably an uninformed opinion, as i'm sure others know much more about the future of education and its costs.

ok, sorry, back to the topic at hand...

Yes I am. I'm a member of stock advisor, rule breakers, and Supernova. I am self employed so I have a little more flexibility in my retirement account. I dumped most of my mutual funds and went mostly stocks about 1.5 years ago. So far so good. It is more time consuming to keep up with but I've liked it and done very well so far.