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Old 09-28-05, 10:22 AM   #1
DXchulo
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Are you Invested in Stocks?

Do you have money in the stock market? Why or why not (and if not, do you invest in some other way?)?

If so, what stocks do you have?

I casually watch the stock market but I'm just a poor student right now (a poor student with a $700 bike, so there's no sympathy) so I don't have any money to invest. Otherwise I'd dabble in the stock market and probably lose all of my money.
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Old 09-28-05, 10:32 AM   #2
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I dabbled a few years ago......but when my mom died there was really no money to take care of the expenses involved, so I had to pull my investment money for that.

I didn't dabble heavily....just a little here and there. I would research a little bit and try this or that. I "rolled" with Microsoft a few times (buying when it went down to $24-25 and selling when it went up to $27-28).

Over the 6-8 months or so I was doing it, I ended up with about 17% more than I started with (which according to the "experts" is pretty good - anything over 15% is considered pretty good).

I would like to get back in....but don't quite have a big enough lump sum to play with right now. At the time I took about $2000 out of my savings and considered it "play money" and if I lost it, I lost it. Luckily I did better than that and made a little.
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Old 09-28-05, 10:44 AM   #3
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I've played around with investing in various ways since the mid-'80s. Based on my mom's old-school philosophies, I bought a troy-ounce of gold with my paper-route money. Did pretty good in the stock-market back during the dot.com era. Then cashed out and put it into futures and commodity options after that.

Personally, I think you have to define your goals before getting your feet wet. The goals and resultant risks really should match your age, remaining earning years and personality profile. One you've defined the goal, select the appropriate strategies and tactics that will yield the results you want. Too many people just hop into the market without a clearly-defined goal of what they want, much less any kind of game-plan. Then they end up using the wrong tools trying to get inapproriate results.

You can consider that EVERYTHING you do with your money is an investment. Sticking it into a shoe-box under your bed is an investment with a certain rate-of-return. Putting it into a saving-account is an investment. Both strategies have negative returns because you're losing an average of -7% a year (average inflation for past 30-years). If you're making enough to match inflation, you can at least maintain your purchasing power. If you're beating the overall market-average like Termite, you're ahead of the game. It's free money to an extent because you're not trading the most valuable thing you have in life, time, for an houry/yearly salary.

Investing is a journey of learning, trial & error, just like everything else in life. There's nothing guaranteed just like in real-life. Only sure thing is death & taxes, so plan accordingly.

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Old 09-28-05, 11:10 AM   #4
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I have a rather small portfolio. 1 stock, 1 mutual fund.

Stock is DTE (DTE Energy). My grandpa bought me 5 shares for my 3rd birthday back in 1988 and it has since grown (from dividend reinvestments) to roughly 27 shares. Also, those 5 shares cost him $50 (stock price + commission) in 1988 and the account is worth around $1,250 now.

I was recently hired at a new place that will NET me around $600 more, which I plan to use to start paying off my car earlier and dabble in the stock market.

I still don't have a defined strategy yet though.
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Old 09-28-05, 11:11 AM   #5
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Quote:
Originally Posted by DXchulo
Do you have money in the stock market? Why or why not (and if not, do you invest in some other way?)?

If so, what stocks do you have?

I casually watch the stock market but I'm just a poor student right now (a poor student with a $700 bike, so there's no sympathy) so I don't have any money to invest. Otherwise I'd dabble in the stock market and probably lose all of my money.
The Toledo Blade has an annual stock contest if you would like the thrill of playing the market with out the sorrow of losing all your money.
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Old 09-28-05, 11:16 AM   #6
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My favorite stocks at the moment are bio-technology and genetic engineering, they are hot! I've also been a big fan of REITs (real estate investment trusts) since the tech crash. These are available for a variety of properties, I like those who own fast food properties, and hotels.
Watch out for mutual funds, they can have very high hidden charges that eat up gains.
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Old 09-28-05, 11:24 AM   #7
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The problem with stocks is that your investments are too diluted to have any say in the company. The managers, who pay themselves big salaries, regardless of whether the company does well or not, are simply not accountable to shareholders. And their large stock options are paid out from the money you put in. Sounds like a bad deal to me. You put in the money, take all the risk, and the executives pay themselves with it, whether they succeed or not. If you want to invest in stocks, it may be wise to invest in companies where the founder or other shareholder holds more than 50% of the shares. That way they have an incentive to keep management behavior in line with shareholder interests. A rarity these day.

An excellent book that discusses this problem in depth is "The Modern Corporation and Private Property" by Adolf A. Berle.
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Old 09-28-05, 11:36 AM   #8
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My grandmother invested $1,000 in 1973 for me, and gave it to my uncle to manage. He's been doing it ever since. I get a statement in the mail, but I only ever look at the bottom line. It's nice to know I've got investments, but I don't even think about it. If I had to liquidate it it'd be close 50K, but this way it's there for the future. Or God forbid an emergency.
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Old 09-28-05, 01:47 PM   #9
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Quote:
Originally Posted by Ziemas
The Toledo Blade has an annual stock contest if you would like the thrill of playing the market with out the sorrow of losing all your money.
But the potential sorrow is half of the fun.
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Old 09-28-05, 02:49 PM   #10
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For anyone interested in playing the market but not willing to take a financial risk (which means you won't get a financial return):
Realtime Stock Trading - Without the Financial Risk
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Old 09-28-05, 05:13 PM   #11
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Quote:
Originally Posted by Totoro
The problem with stocks is that your investments are too diluted to have any say in the company. The managers, who pay themselves big salaries, regardless of whether the company does well or not, are simply not accountable to shareholders. And their large stock options are paid out from the money you put in. Sounds like a bad deal to me. You put in the money, take all the risk, and the executives pay themselves with it, whether they succeed or not. If you want to invest in stocks, it may be wise to invest in companies where the founder or other shareholder holds more than 50% of the shares. That way they have an incentive to keep management behavior in line with shareholder interests. A rarity these day.

An excellent book that discusses this problem in depth is "The Modern Corporation and Private Property" by Adolf A. Berle.
heh, heh... for an insight into the history of corporations and how they operate, check out the 3-part documentary "The Corporation" by the CBC - Canadian Broadcasting Company.

The purpose of owning stock has changed tremendously numerous times since the 1600s when the first public stock offerings were sold by the Dutch East India Trading Company. This was a more stable and gave more guaranteed returns to less-wealthy families than the previous methods. Before that, the investment instrument was closer to all-or-nothing options where well-off or royal ruling families would finance expeditions for spice & trade in far-off lands. Most of the time, these ventures ended up a total 100% loss, but when they won, they won BIG! By owning shares in the trading company itself, rather than financing individual expeditions this allowed a larger number of players to share in the gains. This is one of the first instances of profit-sharing.

In the 1700s up to the 1920s Depression, stocks and stockbrokers were a shady bunch. Tonnes of people were bilked for all their money with bogus stock certificates in non-existent companies. However, there were plenty of valid gains and the easy money of the roaring-'20s gave people a sense of euphoria and hopeless optimism about the market. However, banking rules were so relaxed that banks and borrowers got themselves into taking out way too much margin without collateral. This was one of the triggers that caused the start of the Depression in '27.

It took close to two decades for the market to recover back to its 1929 levels. With investor confidence having been well shaken up by the Crash, new paradigms and philosophies with investment developed. This is where the 'value' idea of investments came from. Book-value and profit-sharing through dividends were highly valued indicators. If a company went bankrupt, a low price to book-value cost for your shares guaranteed you some money on assets in case a company went under and you'll get something for auctioning off their building and office-equipment ($0.25 on the $1.00 was still better than zero). Or in the case of dividends, a payout of %20 of the stock-price per year (PE came from this) was definitely a worthwhile investment.

However, in today's market with company stocks selling for well over 100:1 over their book-values and dividend payments of less than 2%, if any on profits, those measurements don't help much. Major regulatory changes in 1975 really changed the nature of the market and allowed brand-new and exciting profitable strategies to be developed. Too bad 97-98% of the market haven't learned to take advantage of these new rules yet. The Black Monday crash of 1987 brought about some new regulations as well, requiring some modifications to tactics, but this was just an incremental adjustment rather than sweeping changes like 1975.

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Here's another good reading: "Creature From Jekyll Island" by G. Edward Griffin

Last edited by DannoXYZ; 09-28-05 at 05:29 PM.
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Old 09-28-05, 05:23 PM   #12
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Check this out for a RELATIVELY safe way to invest in a low cost way and by diversifying and without trying to time the market. You'll do better than probably 90 percent of other individual investors. While there are no guarantees, history will be on your side, especially if you think long term.

http://flagship2.vanguard.com/VGApp/...%3DHomeoffer01
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Old 09-28-05, 05:42 PM   #13
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Yeah I dabble. Currently I am in GE, Ford, Sirius Sattelite Radio, Sequenom (penny stock) and Harken Energy (another penny thats enjoying a little run right now).

I started out with about 100 bucks and an account at BuyandHold.com. I've made a few bucks and had some fun.

When you start out trading on your own, don't bet the farm. I play my penny stocks like it was lottery money. Good sized risk and good size rewards/loss is only a day away with penny stocks.
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Old 09-29-05, 07:09 AM   #14
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I dabbled in a MF for about a year and got out, mainly due to my dissatisfaction with the company I dealt with. I stayed out on moral grounds.

Commodities I would consider, but not companies/ITs/MFs, unless I invested ethically. Amoral capitalism, yuck!
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Old 09-29-05, 08:35 AM   #15
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Quote:
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I dabbled in a MF for about a year and got out, mainly due to my dissatisfaction with the company I dealt with. I stayed out on moral grounds.

Commodities I would consider, but not companies/ITs/MFs, unless I invested ethically. Amoral capitalism, yuck!
You should look into Calvert Funds, mutual funds who only invest in socially responsible firms, no tobacco, military or poluting companies, Google Calvert Funds. There are several others that invest this way, they actually do very well.
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Old 09-29-05, 09:05 AM   #16
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I would dabble if I had people to explain all of the available options to me and give me advice. Ill probably end up throwing it into an ING account
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Old 09-29-05, 09:28 AM   #17
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Quote:
Originally Posted by Blackberry
Check this out for a RELATIVELY safe way to invest in a low cost way and by diversifying and without trying to time the market. You'll do better than probably 90 percent of other individual investors. While there are no guarantees, history will be on your side, especially if you think long term.

http://flagship2.vanguard.com/VGApp/...%3DHomeoffer01
+1

(four out of my seven SEP-IRA and ROTH IRA funds in double digits this year, but unlikely to continue)

- diversification is the key, to survival IMHO... although young folks nowadays would be well advised to invest in growth stocks for the long term (wish i had someone mentor me when i was younger)...

- best bets for me:

1. no interest payments on credit card debt (pay off balance every month)
2. avoid bad debt (buying clothing, food, and other disposables on credit)
3. acquire good debt (such as an affordable mortgage w/interest deductions)
4. pay deductible taxes (real estate, property, state, local), but avoid non-deductible (sales) taxes!
5. diversify: invest in stocks, bonds, annuities, CDs, real estate
6. create a 12-month emergency fund consisting of 12 month's of expenses (use a CD ladder)
7. invest in education
8. invest in health (eat right, regular checkups, and ride a bike!)
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Old 09-29-05, 09:37 AM   #18
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Quote:
Originally Posted by linux_author
- best bets for me:

1. no interest payments on credit card debt (pay off balance every month)
2. avoid bad debt (buying clothing, food, and other disposables on credit)
3. acquire good debt (such as an affordable mortgage w/interest deductions)
4. pay deductible taxes (real estate, property, state, local), but avoid non-deductible (sales) taxes!
5. diversify: invest in stocks, bonds, annuities, CDs, real estate
6. create a 12-month emergency fund consisting of 12 month's of expenses (use a CD ladder)
7. invest in education
8. invest in health (eat right, regular checkups, and ride a bike!)
This is a really good list of some of the most important things to financial success. However, most people think that these are the best things to do but They Don't Do Them!.

One of the more important things on that list: #8 invest in health (eat right, regular checkups, and ride a bike!)
It has been proven in numerous studies that people who are more physically fit have better opportunities in the job market. This doesn't mean you need to be a body builder, but keep those love handles in check. There are plenty of free ways to get healthy. You don't need to join a gym to lift weights or do sit-ups. Even if you don't have a set of weights or a bench-press table, you can still find something in your home that weighs 10 or 20 lbs that you can consistantly use to help train.
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Old 09-29-05, 01:00 PM   #19
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I'll give another positive feedback on using vanguard for retirement savings. Good low-load funds that tend to return well.

I put my retirement savings in mutual funds, I like the Vanguard target 2035 fund, as thats when I'll theoretically retire. Though I also dabble in some stocks via ameritrade. My Novell is up 20%, though the money I put in the company I contract for is down a bunch.

Lastly, real estate has been good. I bought a duplex 9 years ago - tenants have been paying half (or more) of my mortgage over that time & the house has appreciated a bunch as well.
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Old 09-29-05, 02:00 PM   #20
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Originally Posted by halfbiked
I'll give another positive feedback on using vanguard for retirement savings. Good low-load funds that tend to return well.

I put my retirement savings in mutual funds, I like the Vanguard target 2035 fund, as thats when I'll theoretically retire. Though I also dabble in some stocks via ameritrade. My Novell is up 20%, though the money I put in the company I contract for is down a bunch.

Lastly, real estate has been good. I bought a duplex 9 years ago - tenants have been paying half (or more) of my mortgage over that time & the house has appreciated a bunch as well.
I want to do that :-/
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Old 09-29-05, 02:20 PM   #21
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I want to do that :-/
Want to buy a duplex in minneapolis? Its for sale...
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Old 09-29-05, 02:54 PM   #22
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I have a great fund- American Funds. It was up nearly 25% in less than a year! It just made me wish I'd invested more when I had the chance. But oh well.

Definitely it's good stuff. And if you need the money, you can always make a withdrawal and put it back later. I think my stocks are doing really well because my fund invests heavily in European stocks and emerging companies in Asia. I even have a percentage of my stock portfolio invested in Shimano (my financial advisor liked Shimano because of the diversity of their products they produce, like fishing hooks and stuff, and I concurred for the bike components).

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Old 09-29-05, 02:59 PM   #23
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I second Danno's advice of having a plan that defines goals and risk tolerance. Many investors put more work into planning a vacation than they do their investments. Let's face it, vacations are more fun! But investments are more important.
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Old 10-03-05, 11:48 AM   #24
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heh, heh... for an insight into the history of corporations and how they operate, check out the 3-part documentary "The Corporation" by the CBC - Canadian Broadcasting Company.
Yeah, I saw. Worth watching, but rather shallow in its analysis. The book I cited in my previous post provides a more in depth analysis, without the sensationalism.

Also, remember what Aesop says, "Slow and steady wins the race."
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Old 10-03-05, 11:49 AM   #25
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Let's face it, vacations are more fun!
Yup, I have a large portion of my capital invested in those.

Great returns too!

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