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OfflineHotnuts
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Re: Stock Update for January 26, 2010 - SSO, AAPL, GOOG, QTM + Market Thoughts [Re: geokills]
    #11905577 - 01/26/10 01:55 PM (14 years, 5 days ago)

You have no idea how bad I want to go long (sds) right now. Not yet. RSI, is still weak.


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OfflinegeokillsA
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Stock Update for February 4, 2010 - SDS, CREE, QCOM, Currencies [Re: Hotnuts]
    #11960897 - 02/04/10 10:47 AM (13 years, 11 months ago)

I initiated a trading position in the SDS on Tuesday at $35.80, with a stop at $33.77.  I would have added to the position if the S&P had managed to climb closer to 1110, with the expectation that it would fail and turn down before it could breach the resistance at 1114 - 1115 where we first saw confirmation of the recent downdraft.  Well it never got up high enough for me to add to the position, but at least what I have been holding has helped protect me a little bit, though I am firmly in the red today on account of three of my long-term positions really stinkin' up the joint: KMP, BAC, & BP.

So far today, we are barely hanging on to the January 29th low of 1072 on the S&P500.  If we manage to close above this number, we may be able to see some sideways trading or even a bit of a relief rally... but I wouldn't count on much, now that there is a lot of overhead resistance to chew through in order to reach new highs.  The landscape has definitely changed, and on a break of 1072 on the S&P at the close, I would be looking to increase my short positions for further downside by adding to the SDS and possibly opening a position in TWM, a ultra short ETF for small cap stocks.  I will not be adding to either of these positions unless I see the S&P below 1072 at the close, as 1072 could very well prove support (and subsequent resistance if it is broken).

There is not too much I am interested in buying at this point, except perhaps for exceptionally small positions in my favorite stocks.  CREE reported blow out earnings earlier in January, and has now fallen down below the gap.  LED lighting makes sense to me fundamentally, and I think CREE is not a bad stock for a long term investment.  However, it does trade at a high multiple and if we see a more serious correction, it will be punished.  Not a bad entry to start scaling into a long term position, but please tread cautiously!

Another trade I have been eying today would be a long-side position on QCOM.  They got destroyed after earnings, but the stock has settled out around $38.50, providing a good definition of risk and short-term support.  It's really ugly today, sure doesn't feel good to be buying a stock that is hanging on by a thread, but sometimes the hardest trades are the best trades!  I may just pick up a handful of shares at the close if the stock is still above $38.50, with a stop just below today's intraday low.  If QCOM closes below $38.50, all bets are off on this proposed trade.

Lastly, I thought I'd post these comments on currencies from a seasoned Forex trader that I was reading this morning.  I figure Hotnuts in particular could appreciate them, but even for myself who does not trade currencies, I find the statements fascinating (if not also a little frightening!):

Quote:

Re: Currencies, Markets, WFT

Good Morning, Friends,

Somewhat to my surprise, currency markets are pretty active, with the Dollar generally gaining ground on fears that credit contagion will spread from Greece to Portugal (well under way) and thence to Spain, which is a much larger economy, and a more significant member of the EU. With 19% unemployment, Spain's fiscal options are constrained.

So, stronger Dollar, Gold hammered (as I look at my screens, only ag commodities appear to be higher)and T-note and bond prices heading skyward. Not the best backdrop for equities. Locally, jobless claims came in higher than expected, which may make people more nervous about tomorrow's non-farms number. On the currency front, vols are higher as people are playing with short-dated ("high gamma") options ahead of the number tomorrow.

BofA/Merrill reports that for the first time the SOVX index of Sovereign Credit Default Swaps closed wider than the CDX investment grade index of corporate CDS, at 94 bps vs 92 bps. In other words, investors are now paying more to insure against defaults by governments than they are for high grade corporates.

Fidelity keeps sending me messages letting me know that stocks have hit what I thought at some point might be attractive levels for purchase. Maybe not today. I was stopped out of WFT, a small, manageable, irritating loss.

Good luck and all the best.



Hi Forexpro........ Default/Greece, Portugal, Spain...............

There isn't Really a risk of one of these guys defaulting is there? Dubai was rescued...... You don't really expect to see our European friends letting any of these countries go down....... do you?


Thanks, Liz



Hi, Lizwaite,

I just don't know. It seemed obvious even at the time that monetary union without political union could be tricky; it seems equally obvious in retrospect that enlarging the currency union area might be attractive politically but dangerous economically. Several countries, definitely including Greece, were permitted to join even though everyone knew that they were fudging their numbers in order to just barely, maybe, meet the entrance criteria.

The problem now is, who pays? The IMF is willing to help Greece, but they'll insist on IMF austerity measures, which will get the Greek government driven out of office or worse. It has been assumed that Germany, in particular, will grumble and pay to keep Greece from defaulting, but I'm no longer sure that's the case. If Spain comes under real assault, the cost of a bailout would be very high, and it's possible that the larger Eurozone countries will simply refuse to pay.

I don't think that anyone has a good sense of what will happen if/when that occurs, but it's probably not the sort of situation where one would want to be short of Dollars or Treasuries (should help next week's big auctions) and overly long of stocks. When I looked this morning, the correlation between the DXY and the SPX was back to a -0.88.

Interesting times. I'm being told of large stops in gold below 1068, by the way; I'm seeing 1070.95 bid at the moment.

I hope that despite everything you're thriving. I feel like I'm swimming toward the weekend, and the shoreline keeps receding.

Take care, and all the best.




Disclosures: Long SDS


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OfflinegeokillsA
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Stock Update for February 4, 2010 - SDS, ACE, CREE, QCOM [Re: geokills]
    #11961484 - 02/04/10 12:29 PM (13 years, 11 months ago)

I'm taking a pass on QCOM and CREE at this juncture.  QCOM is too weak for me, and I will wait on CREE in hopes that I can snag some shares closer to the 20 day moving average (as it approaches $50).  The overall market is still very weak, breaking well below the 1072 "line in the sand", though we still have a couple of hours to go.  The employment numbers tomorrow are also going to throw some volatility into the mix, and I don't want to lean too heavily in either direction.

The market is quite oversold, and technician Helene Meisler at TheStreet.com notes:
Quote:

"As of this hour the equity put/call ratio is around 84%. The last four readings we had in the 80s all resulted in at least short term rallies.

The dates are: June 17th, July 7th, October 2nd, October 30th.

We've got an employment number tomorrow and then there will be the fear of being long over the weekend due to headline risk, but statistically speaking, there is enough fear out there and we're still oversold enough to get a rally in the next few days."




Accordingly, I have closed my position in the SDS for a 5% gain.  I am not very keen on adding to positions quite yet, as I could see the S&P heading down to 1050 quite readily.  A trading range between 1050 and 1150 seem reasonable for the intermediate term.  Because we are approaching the bottom of the perceived range, I did decide to make a very small purchase for my retirement portfolio, initiating a position in ACE Ltd (ACE), a property and casualty insurance holding company that reported an upside to their quarter earlier this week, with a book value of $58.40 a share.  My position was initiated at $48 a share.  I am keeping a stop just below $47 (January 11th low), making for a very favorable risk reward ratio of around 1:10.

As I am writing this, I see the S&P fighting for a relief rally into the close, now back to the 1072 support level I've been harping on.  I will be looking to initiate new index shorts on strength as the S&P approaches 1100 and 1150.

Disclosure:
Long ACE, APPLE, BP, PEP, BAC, KMP.
Short ENR & HSIC.


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OfflineHotnuts
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Re: Stock Update for February 4, 2010 - SDS, ACE, CREE, QCOM [Re: geokills]
    #11962721 - 02/04/10 03:52 PM (13 years, 11 months ago)

Good one on (sds). I bought the gap a bit higher than yourself at $36.44.


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OfflinegeokillsA
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Stock Update for February 5, 2010 - ENR, HSIC, POT, NLY, PSEC [Re: geokills]
    #11970543 - 02/05/10 04:48 PM (13 years, 11 months ago)

Well that was a pretty darn exciting Friday!  While the employment picture remains bleak and credit worries in the EU are still potent, the US equity market staged quite a bullish performance this afternoon.  After falling deep throughout the morning and piercing the 1050 level on the S&P that I've been noting as my anticipated bottom of a near-term trading range, the market roared back at around 3PM eastern to close positively.

In keeping with the Buffetism, "be greedy when others are fearful, and fearful when others are greedy" - I took some profits on my short positions in ENR and HSIC today, while adding three new long positions to my portfolio in POT, NLY, and PSEC.  My purchases were very small, as there is still significant risk of negative news out of the EU this weekend.  However, these stocks have been so beaten down and close to support levels that I couldn't help but put some money back to work on this weakness.

Potash (POT): This agricultural mining company has been bumping around its 200 day moving average for the past week or so, which coincidentally coincides with the nice round (thus psychologically significant) $100 share price.  I don't see the positive trend for agricultural fertilizers going anywhere, so I put on a 1/3 position size at $100 with a stop just below the Jan 28th low of ~$98.  On a relief rally, I could see this one coming back to its 50 day up around ~$113, making for a risk of $2 for a reward of $13.  Nice ratio indeed!

Annaly Capital Management (NLY): Next up is a Real Estate Investment Trust that I've been involved with before.  These guys manage a portfolio of those often hated mortgage-backed securities.  We do see some signs of housing recovery, though there is likely a lot of "shadow inventory" being held by banks that hasn't hit the market which could cause some trouble down the line.  Accordingly, this is about a 1/4 position size for me, snatched at $17.75.  I am keeping a stop just below $17, where the stock has been basing throughout January.  It has held up remarkably well during the recent selloff, and with a 17% yield, I am happy to sit on this one for a while and add to my position should the opportunity arise.

Prospect Capital Corp (PSEC):  Now I'm getting a little wild... this is a closed end investment company (private equity), that lends and invests in middle market privately-held companies - mostly in the industrial and energy-related sector.  There is danger here as these guys have been trying to improve their balance sheet through the acquisition of Allied Capital, which they are having trouble making happen.  I wouldn't recommend this in the same league as NLY and POT, but with a better than 15% (though not entirely safe) dividend yield and the absolute schmiessing it's taken over the past few weeks, I'm willing to give it a shot.  My stop is just below the Nov 3rd low of $9.82, which is also just under the 50 week moving average which supported the stock in early November.  Take it or leave it, this one is less than a 1/4 position size, just for kicks.  Already up nearly 3% from where I got in today around $10.50, so I'm not complaining!



Now, if we can get some ease of tension over the weekend regarding the credit woes surrounding Greece & Portugal, not to mention the much scarier notion of a Spanish credit problem... I think we can see a rally that will bring us back up to 1100 on the S&P.  On that note, I don't think we're going to new highs here anytime soon.  But this afternoon did have the appearance of a near-term bullish reversal in the market.  We have been awfully oversold and I will look to capitalize on the momentum, but remain at the ready to sell into strength and begin adding to my shorts as we approach 1100 on the S&P.  If we manage to vault up to 1150 on the S&P, I will really start pressing my shorts heavily as that will offer a low-risk entry for playing a continuation of the intermediate-term downward momentum that began in mid January (ie. a double top).


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InvisibleGI_Luvmoney
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Re: Stock Update for February 5, 2010 - ENR, HSIC, POT, NLY, PSEC [Re: geokills]
    #11975006 - 02/06/10 12:16 PM (13 years, 11 months ago)



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OfflinegeokillsA
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Re: Stock Update for February 5, 2010 - ENR, HSIC, POT, NLY, PSEC [Re: GI_Luvmoney]
    #11977941 - 02/06/10 08:07 PM (13 years, 11 months ago)

I've been invested in the master limited partnership Kinder Morgan Energy Partners (KMP) for some time now.

Great investment vehicles, among my largest and most successful long-term positions.


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InvisibleGI_Luvmoney
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Re: Stock Update for February 5, 2010 - ENR, HSIC, POT, NLY, PSEC [Re: geokills]
    #11980371 - 02/07/10 07:33 AM (13 years, 11 months ago)

If you had closed end funds that have MLPs, you don't have to deal with K-1 forms.  I have TYG, TYN, KYN and KYE, and the dividends and return of capital are all added together on the 1099s in my brokerage accounts.


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Edited by GI_Luvmoney (02/07/10 07:34 AM)


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Offlinenice1
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: geokills]
    #11983696 - 02/07/10 06:19 PM (13 years, 11 months ago)

Quote:

If you have a limited amount of capital to work with (or if you want market exposure without having to do any homework!), it may be wisest to start out in a low-fee S&P 500 Index Fund (such as the  Vanguard 500 - VFINX).  This will leave you with a diversified portfolio that mimics the aggregate (overall) market.  Using this strategy, you won't have to worry about underperforming the market, and since the average 20-year market return has beaten any other asset class for the better part of the past century, this is not just a convenient way to gain market exposure, but a fairly sound investment strategy.





I'm a noob but enjoying this thread and trying to understand.

So basically to invest in the FVINX is a pretty sure fire bet?

What sort of % does it increase by each year.

Currently my savings money makes 3.5% but its tax free.


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OfflinegeokillsA
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: nice1]
    #11986543 - 02/08/10 08:32 AM (13 years, 11 months ago)

There is no sure fire bet.  There is always a proportional risk:reward scenario, where typically the more you risk, the more you stand to potentially gain.  With an S&P 500 index fund, historically over the long term you have done OK (and depending on your entry, you may have done excellent).  Of course, the last decade (particularly 2002 and 2008) has proven that the market does not always rise and we won't know for certain when it will or won't, until we're lookin' at it through the rear view mirror!

Nevertheless, if you have cash on hand, you don't know what to do with it, and won't be needing it in the near future (say 3 - 5 years), you should definitely put that money to work one way or another, dependent upon your risk appetite.

If you are completely risk averse, you can stick it in an FDIC insured Certificate of Deposit account.  Feelin' a little more risk, seek out some tax-advantaged bonds of secure municipalities or corporations.  Even more thirsty for risk?  Now it's time to consider the S&P 500 or individual MLP's (such as the previously discussed Kinder Morgan Energy Partners), ETF's, and dividend yielding stocks.  Want to play with fire? There are option strategies and leveraged trading where things can move much faster, both for and against you (not recommended until you have a very firm grasp on the workings of the market).

Be mindful that several of the above investment opportunities (from the S&P 500 onward), will require increasingly more active management (ie. time) if you wish to be consistently successful.  So not only is risk a factor, but the time you are willing to put into managing your money as well.

For what it's worth, a guaranteed 3.5% tax free investment isn't a bad one in this space and time! :smile:


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Offlinenice1
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: geokills]
    #11986618 - 02/08/10 08:56 AM (13 years, 11 months ago)

Thanks for your reply.

I'm a low risk person.  I think I'll keep the 3.5% account at the moment while I learn more about stocks.


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OfflinegeokillsA
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: nice1]
    #11986768 - 02/08/10 09:35 AM (13 years, 11 months ago)

While we're speaking of the S&P, I've opened a medium sized trading position in the Ultra S&P500 (SSO), which is a leveraged ETF returning roughly 2x the daily movement of the S&P 500 index.  I will be stopped out if SSO falls below $34.88, and will be quick to take any profits, should they manifest.  This purchase is on the heels of Friday's reversal that saw me buying individual names such as POT, NLY, and PSEC, all of which are behaving very well.  With the market showing a decent opening so far, I'm inclined to take on a little more risk with this trade, but likewise won't hesitate to bail if the tide turns against me!

Edit: Stopped out of position in SSO.  Entered 1/5 position size in Etrade (ETFC) at $1.50.  Piggybacking on seasoned investor Doug Kass' advice:
Quote:

Over the short term, shares of E*Trade could be pressured by the company's plans to eliminate all account maintenance fees, its $12.99-per-trade commission tier and $0.015-per-share fees on trades greater than 2,000 shares. Having said that, I see a great buying opportunity in E*Trade, as numerous positive catalysts exist.

I would project that the commission fee cuts will affect a small portion of the company's clients and in the aggregate will likely reduce the company's annual revenue by only $80 million ($40 million from maintenance cuts and $40 million from reduced commissions per trade). Moreover, as Friedman Billings notes this morning, "We view this move as necessary for E*Trade, and it should help to neutralize the chance of competitors engaging in a traditional price war." The overall effect of the price cuts is to reduce earnings by about 1.5 cents a share in each of the next two years.

Consider the following factors:
  • Wall Street earnings estimates remain too low for E*Trade for this year and for next year. I think the company could turn to breakeven by the third quarter of 2010. If accurate, E*Trade could buy back stock, pay a dividend and/or call a portion of its bonds then.

  • E*Trade's book value is $1.63 a share.

  • While purchase accounting requirements related to a change of control provisions that require a mark on the loan portfolio preclude a takeover in the next six months, a takeover in late 2010/early 2011 seems possible. The company's private market value is approximately $3.50 a share, more than double the stock's $1.45 a share.

  • Normalized earnings are about 18 cents to 20 cents a share, which should be achieved within two and a half years. The present value of those profits is roughly $2.10 a share, or 45% above the company's current price. Fifteen times normalized earnings provides a $3.00-a-share target.






Edited by geokills (02/08/10 12:12 PM)


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InvisibleStonehenge
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: geokills]
    #11988918 - 02/08/10 03:55 PM (13 years, 11 months ago)

I'm disenchanted with the stock market and all the insider dealings and whatnot. That along with the uncertainty of the economy makes me think real estate is the way to go. I have a bid in now on a property and should find out if i bought it or not in the next day or two. Even if not, i will keep making bids and hope to pick up a few properties priced right by the end of the year. The one i bid on sold at $147k 3 years ago and i bid 25. Yes, i'm trying to steal but who can blame me? In 5 years i have an excellent chance of it going back to that price which was not even at the peak of '05. Plus rent should be at least 9k a year and taxes less than 2k. People have to live somewhere and in 20 years there is a 95% chance we will see the highs of 05 again. How many stocks pay that kind of dividend (rent)? Plus the chance for price appreciation is there as well.

I think RE will keep dropping in the short run but the prices i'm offering mean that they can drop 20% in the next year and i'll more than make it up on my rent profit. And if prices go the other way, i'm in hog heaven. Sooner or later they will. Even if prices never go up, (which is somewhere between unlikely and wassa matter you crazy?) i'll get my money back in the form of rent within 5 years even counting the cost of rehab and maintenance. Then the property is free and still paying rent. Show me a stock with that upside potential without getting extremely lucky?


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OfflinegeokillsA
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: Stonehenge]
    #11995590 - 02/09/10 01:33 PM (13 years, 11 months ago)

No doubt.  Several members in my family have been purchasing real estate over the past year.  Unfortunately, my bread and butter retail business is uncertain at the moment after my key product producer declared bankruptcy a couple of years ago (with $35K tied up; no return since).  To be frank, I don't have the free cash flow to justify a real estate investment at this time, particularly as property values where I live (the Los Angeles area) are still expensive for the areas in which I would want to manage.

I have my feet wet, managing eight rental units on three properties currently, but those properties belong to my mother who has since moved out of state.  It looks like I will have new inventory coming from a new manufacturing facility for my retail business this Spring, but I'd bet it will still be at least another year before I can feel comfortable seeking out and confidently bidding on real estate for myself.  In the meanwhile, I'm happy to dabble in stocks, tend to my existing management duties, and of course hold down the fort at the Shroomery/Growery.

I picked up some AT&T (T) just under $25 a share yesterday, sporting a 6.73% annual dividend.  The market has behaved well today, and we have a decent setup to support a continued oversold rally throughout mid-week and maybe even into the weekend.  Nevertheless, while I will let my short-term winners run for a while, I am keeping my stops tight in anticipation of further negative pressure in the coming weeks.


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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: geokills]
    #11996219 - 02/09/10 03:06 PM (13 years, 11 months ago)

There is definitely money to be made on stocks, assuming they dont crash again. And you don't have to do any work to get the dividends. In RE you do have to put in some work and there is always some risk but it can be managed. In my area property is cheap. Although, i looked at a comparable for a house i saw today they wanted 34.9 and it's assessed at 79. It needs a little work and a house just down the block sold at assessed value last month. This house sold at 112 in '05 at the height of the bubble. If i make an offer it will be around 23 and see what they say. I looked briefly at two others today that are asking 26 and 33. They all  need some work but there are tons of construction people out of work now and you can pick someone up for $10 an hour easy.

Still no answer on the one i made an offer on. I don't want to buy two houses at the same time. Not because i dont have the cash but being somewhat of a newbie at this type of investing, i want to be able to give it my full attention. The one i bid on needs a roof, new cha, and some interior work plus it needs a little termite treatment but that does not look extensive. I figure i can get it in shape for 5k and it will look great. It actually sold for 155 in oct  07, 147 was the mortgage amt. They must have put 5% down and defaulted. If i put 100 into these distressed properties and rehab them i will make a killing if they even go for assessed value. If i can get the price they went for in the last 5 years i will make a huge killing. Plus they return rent while i wait.

The roof will price at about 3k but i can pick up the materials for probably less than 1k and pay someone to do it by the hour. Maybe 4 or 500 in labor. It has only a single roof and you are allowed to go two roofs here so i can pull a permit and let the guy nail up shingles at his own pace. Since the old roof wont be torn off, i dont need to stress over rain and one guy can do it though it may take a week or two. Its sad how many people are out of work and will take anything. I might pay the roof guy 12 if he is good and has all his tools and equipment. The general labor i will pay 8 to 10 and still be able to pick and choose who i want.

I'm not discounting the fact that property could keep going down for a few years. I will not look too brilliant if that happens but the rent makes up for it. The one i offered 25 for should go easy for 800 a month and maybe 900 rent to own. Rent to own is a good way to get tenants because they will pay more and get about 200 a month credit toward buying. I figure i'll offer it at 61 with 10 down and take back a note at 10%. Rent to own people take better care of the property. Even if re shoots up in the next year and i could have sold it for more, i'm not doing too bad and if it stays flat or drops a little, i get all that rent. 9 bills a month is almost 11k a year and i figure to have 30 in it and less than 2 a year in taxes. I would actually get my money back in less than 4 years if everything goes right just off rent. But i figure 5 and then its paid for. How long does it take for stock to pay you back on dividends?


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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OfflinegeokillsA
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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: Stonehenge]
    #11997423 - 02/09/10 05:58 PM (13 years, 11 months ago)

How long a stock takes to pay you back on dividends is a spurious question my friend!  There is no reliable way to discern for certain how long it will take a stock on average to pay you back since dividends vary greatly from issue to issue, and even then they can be raised or lowered dependent upon the underlying fundamentals of the company paying them.

But just for kicks... If we take Annaly Capital Management (NLY), currently offering a 17.35% annual yield, with dividend reinvestment you're lookin' at about 4.5 years for the dividends to result in a 100% return on investment.  With taxes and inflation factored into the equation, it would probably take closer to 6 or 7 years.

Of course, this is all hypothetical as dividends are unpredictable in the same way that your tenants might move out (or worse yet you have to evict them after months of non-payment) and you can't rent the place to anyone else for several months after that and may even have to do significant repairs to the property!  The bottom line is you just never know, but you can have a reasonable assumption and should make your decisions based on that.

I hope you get your house! :sun:


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Re: STOCKS - A Beginner's Guide (Stock Market Primer) & Running Record [Re: geokills]
    #12021912 - 02/13/10 01:52 PM (13 years, 11 months ago)

I replied to this but do not see my post today. The stock you mention had a much larger dividend last quarter and a good last year. Even that does not give it 17% for the year unless you project the current dividend for the whole next year. Which is speculative to say the least. The current 75 cents was 19 cents a while back. Rent does not fluctuate like that. The figures i gave were for real properties and based on current prices and rents. Even nicer houses that dont need as much work will rent out at around 15 to 20% of current value. So just by renting them out you know you will get your money back in a few years barring catastrophe and you can always buy insurance. Try getting insurance on your stock.

Lets take the hypothetical example of a person who buys now and rents for 10 years at the end of which russia send a missile and blows the house away. Ins doesn't cover acts of war so you are with nothing. But, you got your money back and more interest than the bank would have given you from the rent. Some people would call that a happy ending. And the lot is liable to be worth as much as the house was. It would be worth something, maybe quite a bit.

Now lets look at a rosier scenario. You rent it out for 10 years, no missile strikes, property values go back up and you keep all the rent plus sell it for a huge profit. Or jack up the rent and go for a bigger profit later. Worst case = good, best case = wow!

I got out of sds (ultra short stock) when it was in the upper 50's. I looked recently when the dow was dropping and it was in the 30's. We would need another crash to bring that one up. With RE even if property keeps dropping a while longer you get it back on rent. Instead of win/lose you have win/win or win small vs win big or win huge. And if inflation hits like many economist predict, you will win huge or maybe HUGE!


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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Re: Stock Picks for January 3rd, 2008 - STJ, SGP, CVS [Re: Stonehenge]
    #12033020 - 02/15/10 10:38 AM (13 years, 11 months ago)

an interesting site that I was directed to while on a plane with an oil worker who works in Africa (crazy man yet an interesting man)

check out morningstar.com

its a 101 guide to beginners or a tool for experts


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Stock Update for February 17, 2010 - Resistance, Stops & Shorts [Re: geokills]
    #12046544 - 02/17/10 11:52 AM (13 years, 11 months ago)

The market is approaching resistance at 1100 on the S&P500, with its 50 day moving average looming just overhead at 1108.  As a result, I have tightened all of my stops in order to protect aggregate profits on the positions that I opened about a week ago in POT, PSEC, ETFC, T, and NLY.  With the exception of NLY which is down 1.5%, all the other issues are 2 - 13% higher than my opening basis roughly one week ago.  I can now rest assured that even if the market fails here and resumes its intermediate term downtrend, these positions will still be profitable when they are stopped out at my newly defined risk levels.  On the other hand, if we can manage to break above 1100 and subsequently 1108 on the S&P, these positions will be free to capture continued upside.

I would be mindful that the market is starting to stretch toward the upside and becoming overbought on a short-term basis, and thus would continue tightening my stops diligently should the market move higher.  If we manage to approach 1150, the top of my earlier proposed trading range, I will be forcing sales for partial profits on some positions and begin to lean more heavily on some short positions.

On that note, because we are at a resistance level currently, I have purchased some ProShares UltraShort Russell2000 (TWM) with a stop just below today's intra-day low.  The Russell 2000 index is further extended than the S&P, and therefore if the S&P fails at this level, the Russell will likely be hit even harder.  TWM is a leveraged short ETF, returning two times the daily inverse of the Russell 2000 small-cap index.  Along with my short positions in ENR and HSIC, TWM will help to hedge against potential downside, since I am still maintaining core long positions in KMP, BAC, PEP, BP, and AAPL.


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Re: Stock Update for February 17, 2010 - Resistance, Stops & Shorts [Re: geokills]
    #12050409 - 02/17/10 08:52 PM (13 years, 11 months ago)

You better tighten up those stops! Stocks and certain commodities, are about to get thumped.


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