This thread tracks real trades in one of my portfolios. Refer to backgrounder for more info.
Nothing really to write home about this week. Bought Brazilian natural resource producer Companhia Vale do Rio Doce (RIO) on Monday. It is the world’s largest Nickel producer and ranks among the top producers of Iron Ore. Nickel is under a tremendous supply deficit from rising demand from the world’s largest nickel consumer - China. This has led Nickel’s price to almost triple in the past year. Usage in China may grow 28.5 percent this year. Most Nickel is used to make stainless steel.
As the world’s largest Nickel producer, RIO has benefited. Its stock is up 24% year to date.
Continue reading ‘Real Money Portfolio - Update 3/31′
Recall the objective of this experiment is to produce double digit returns by dollar cost averaging into either financial assets or hard assets based on where we are in the cycle. I contend that we are in the hard asset phase. Read “The No-Brainer Investment Strategy to Double Digit Returns” for more details.
Gold lost $40/oz (slightly over 7%) from February 27 to March 5, as the February stock market smack-down had a major effect on old yeller. By the end of the month, it had recovered nearly half of its losses. Silver on the other hand was hit much harder as it lost 14% over the same period. CEF, a 55/45 mix of gold and silver bullion, was down 2.7% for the month and GDX, Gold Miners ETF, closed down 0.8%. The S&P 500 closed the up 1%. CEF and GDX are both now lagging the S&P 500, but Gold’s recovery over the past three weeks is encouraging. Continue reading ‘The Dollar Cost Averaging Experiment Results thru March 3 - Recovering From the Smack-Down’
One of my least favorite subjects in the financial freedom arena is debt reduction. People use all kinds of reasons to justify their debt and it becomes a very emotional struggle to eliminate it. I am pleased that I have adopted the “Not So Easy” approach to financial freedom. That way I don’t have to come up with any psychological approaches to achieving financial independence. Why pretend that something is easy - when it’s not….
Continue reading ‘Debt and Financial Freedom Don’t Mix’
I have sold at the bottom far more times than I care to admit. However, if this is another occasion so be it - Sayonara, Au Revoir, Adios Gold stocks.
I purchased my first gold stock, Royal Gold, in May of 2002. At the time, I really didn’t know much about gold or gold stocks and had no idea that it was the beginning of a bull market in gold. Royal Gold met the criteria of a screen that I was using at the time and it simply was one of many stocks that popped out. The trade didn’t work as I had hoped. After a quick 20% haircut, I sold it three weeks later. This didn’t discourage me. As I read more about gold, I realized that something special was in the makings.
Continue reading ‘Sayonara Gold Stocks’
Published March 25th, 2007
in Portfolio - Updates (all).
The Fed met on Wednesday and held rates at 5.25%. The statement released with its interest rate decision was interpreted by the market as dovish. Meaning that we will see lower interest rates before we see higher rates. The market responded with gains of 2.9%, 3.5% and 3.2% for the DOW, S&P 500 and NASDAQ respectively for the week.
Lower interest rates should be bullish for gold, but it didn’t respond as such. For the week, Gold was up a rather disappointing 0.5%. Silver was essentially flat 0.1%. Copper continued strutting its stuff up 1.9%, but the commodity star of the week was Oil up 4.5%. Start getting ready for higher gas prices for the summer driving season.
So, how did the portfolios perform? Continue reading ‘Week in Review 3/25 - Stocks Up as Fed Signals Lower Rates’
This thread tracks real trades in one of my portfolios. Refer to backgrounder for more info.
Let’s take a look at the trades. It wasn’t a great week.
Continue reading ‘Real Money Portfolio - Update 3/24′
Published March 23rd, 2007
in Real Estate.
Real Estate investors should be looking for opportunities within this debacle. Certain niches are still growing.
Source: Real Estate Journal
The real-estate slowdown has forced some investors to change tactics. Gone are the days when an investor could buy a single-family home or condo, flip it, and walk away with a sizeable profit just weeks or months later without much effort. But there’s one niche that continues to show promise for investors undaunted by the slumping housing market: college-town real estate.
This segment has recently caught the attention of large institutional investors like American Campus Communities, a publicly traded real-estate investment trust that earns 95% of its revenues from ownership of off-campus housing, according to Bill Bayless, chief executive officer of the Austin, Texas-based company. He and real-estate experts like Michael H. Zaransky, co-CEO of Prime Property Investors Ltd., a real-estate investment firm in North Brook, Ill., point to rising university enrollments and increasingly limited on-campus housing as two factors that make buying and renting out college-town housing an attractive investment.
While institutional investors like American Campus Communities — which builds large, multiple-unit housing projects for students in campus towns — compete with individual real-estate investors, there is still plenty of room for smaller property owners to profit, Mr. Bayless says.
“I think it is among the top real-estate niches for any real-estate investor to look into,” Mr. Zaransky says. “It is not tied to general economic performance. It is tied solely to growth and enrollment in schools.”
More …
Published March 22nd, 2007
in Economics.
It’s all over the news subprime lenders are imploding left and right. The net result is tighter lending standards that eliminates many new buyers and affects the trade-up market. What happened to the good old days when a person with a $60K job could afford a $600K McMansion? Obviously there is plenty of blame to spread around.
Here are three excellent articles that discuss who took the punch bowl away. Make sure to read the comments to the articles as well.
Nouriel Roubini’s Global Economics Blog
Mish’s Global Economic Trend Analysis
Ron Paul’s Texas Straight Talk
I discovered Adam Hamilton in late 2002 and since have read his weekly essays without fail every week. I have incorporated his theory on market cycles into my trading strategy. His research has shown that throughout history markets tend to move in great cycles, long bulls followed by long bears. These cycles are around 34 years long - resulting in a 17 year up cycle followed by a 17 year down cycle. Obviously no market goes straight up or down, so within those major cycles are minor counter-cycles to keep everyone on their toes. Our last major up cycle ran from 1982 to 2000. So, we are now 7 years into the down cycle. If you entered the market in 2003 - it doesn’t feel like a down cycle. However, if you bought tech stocks in 2000 you are still down 50%.
Why am I mentioned this? Continue reading ‘Maximizing Your Trading Years’
Published March 21st, 2007
in Financial Freedom.
It has taken me nearly 20 years to attain financial independence. I am not going to sugar coat it, because it hasn’t been easy. If anyone tells you it is - put your hand on your wallet and run. Now it shouldn’t have taken me 20 years, but I made MANY mistakes. On these pages, I attempt to share some of the wisdom gained from those painful lessons. The hope is that this will significantly speed up your time to achievement. Depending on your current financial state and openness to change, my best guess, is that it will take somewhere between 1 to 10 years to achieve financial freedom.
If you are on my mailing list - you have seen my “5 Not So Easy Steps to Financial Freedom.” In this document, I attempt to organize much of the content on this website into the 5 steps. My goal is to formalize that in the future. Send me some feedback and let me know what you think.
For those who haven’t seen the steps here they are. Join the list to receive the entire document. Continue reading ‘5 Not So Easy Steps to Financial Freedom’
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