T Nation

Investing Thread


#1

Now that the real estate market is cooling I am curious as to where people are thinking about investing. I had some pretty good luck with a natural resource fund and am thinking about investing a far larger share of my meager wages in foreign markets given the current account deficit.

Where are other people putting their money? Don't mention individual stocks but maybe sectors such as commodities etc.


#2

If the real estate market is cooling off where you are (I'm in Australia) then I'd be watching real estate closely trying to find good opportunites. That's the time to buy, not the time to run away.

I'm holding onto my properties and watching the market in Oz while it cools too. In the meantime I'm trading options and shares to keep the cashflow churning, but as soon as I see a property looks good, I'll jump onto it regardless of the current market conditions.

In between trades - I train...

Duke.


#3

I know the market has cooled here, but there are a lot of people who got caught with properties they were planning to unload. Now they're in over their head and are willing to cut a great deal to get out. Duke's right, look for a great opportunity right now.


#4

Japan appears to be a good place to put money presently. It's not expected to last though.


#5

Well, I did fantastic this past year in the European market.


#6

Any new ideas/news links?

I read about natural resource funds a year ago and did well, but it is rare to find an investment article that makes a really good point about the valuation of a sector before the correction has already occured.


#7

The slump in R.E. is just beginning, IMO

It recently started to tank after about 14 consecutive interest rates rises. My benchmark is the Vanguard REIT Index (VGSIX), compared to the DJIA from March 1, 2000 to now. A 120% run-up.

Food for thought.


#8

How do you arbitrarily choose March 1st 2000 to start your comparison? And why on earth would you compare a REIT index to the DJIA? What is that supposed to clarify? What is their relationship? I bet you are a proponent of technical analysis and a big purchaser of body building supplements.

If people have to ask for investing advice they don't have a clue what they are doing when it comes to investing. If people give investing advice they don't have a clue what they are doing when it comes to investing. If people are trading they just don't have a clue.


#9

Defense stocks. Fidelity offers a fund like this.

http://www.fidelity.com

If the world becomes a peaceful, joyous place, you'll lose money.

If the market collapses, you'll lose a lot less than most, since a war will probably cause the collapse. If most everyone else loses 90% of their wealth and you lose 50%, you've gotten richer (relatively speaking).

I think defense stocks are the new 'blue chips' for the next 20+ years.


#10

A) Just a couple of days before the tech bubble burst and corresponding market collapses. I dont give a shoot how a portfolio behaves in rising markets. Backtesting with historical slumps prevents one from succombing to thebuy at the top euphoria, sell at the bottom` pattern.

Then again, why shoud anyone buy at the top, unless hes trying to go for momentum and market timing (if thats your case, good luck, I don`t believe in it).

B) OK. Name me one index that is representative of the real estate market, then. I chose that one from Swensens book. I compared it the to DJIA to show people its 6-to-1 runup in the last 6 years. Now it that currently isnt overvalued, I dont what is (except gold).

C) Technical analyst? Almost. Im more of alazy portfolioinvestor, buy-the-whole-market, if you cant beat em, joinem index invesor. Big buyer of supplements? Too bad for insinuation, but nope.

D) In general, investors don`t have a clue with regards to timing in my book. The Average Joe has a 2.3% annual return on his total investments.


#11

Maybe the Vice Fund (VICEX) would interest you too.


#12

Thanks for the tip. I prefer a fund that only is into defense and aerospace (come from a family of drunk smokers.)


#13

MobilExxon, GE, Budweiser, Philip Morris and Disney. That's the hypothetical kroby mutual fund. As for real stuff, Fidelity offers many opportunities :slightly_smiling:


#14

Anyone Looking for "Safe money", INGdirect.com offers some top knotch savings accounts.

My current account started a 2.0% and is up to 4.15%, and they have a CD for 5.2% for 12 months right now. For a 21 year old thats pretty good.


#15

Commodities/Energy and small caps have been the place to be for awhile now. Phelps Dodge, Goldcorp, Allegheny Tech, etc. Nothing else is really consistently working besides construction/infrastructure, aerospace/defense, commodities/mining and energy. Tech in general has been sucking hind tit lately too. Microsoft's perceived bad quarter flattened the whole sector.

The hedge fun I work at was fortunate enough to be 30% in cash for the past week so we didn't get crushed TOO badly (still lost a little over 1% of gains). We bought a little Friday and plan on doing some more buying this week as it looks to be flat to relatively negative. Might not be a bad time to look at some deep in the money calls right here either for about 4-5 months out. Just my thoughts though, and technically i'm still just a pissant business school student and junior trader.


#16

Gold, precious metals, and commodities. 'Nuff said.


#17

Eastern emerging markets are doing relatively well.

India, for instance, is booming.

Japan, although an old economy, is also providing good returns.

My money's on non-renewable energy stocks - solar energy in particular.


#18

You say 4, 5 or 6% return maybe good enough for a young fella, but the derivatives market can return 30% or more. I'm aiming at 90% gross return for this year on derivatives. My real estate returns have averaged over 12% compound. Why would anyone, regardless of age, think that 4 to 6 % is okay.

Knowledge is a key to high returns, not having a fund manager doing your work for you. Einstein apparently said something like... One of the most amazing things on earth is the power of compounding growth.... I'm sure someone will know the exact quote, but it's bloody true.

Invest in your own knowledge and compound your returns.

If you're interested, if you played a 36 hole game of golf and bet just $1 on the first hole and doubled (compounded) on every hole after that. How much is your potential gain (or loss) at the 36th hole.
Does the answer amaze anyone?

Duke


#19

The reason 4 - 5% it is "okay" to a young fella is because if I lose $5,000 thats a HUUUUGEE chunk of my nestegg. NO ONE else I know my age has ANY money in the bank, so the fact that I have nearly $10,000 at age 21 makes me want to hang onto it and not end up like my fellow youngsters. I've worked my ass off to save that, none of that is from my parents or anyone else.

Perhaps as I get older and can actually start investing decents amounts of money, I will laugh at 4%, but not yet.


#20

Sorry mate, not trying to put shit on you at all. What you've achieved is absolutely wonderful. I guess my intent was to encourage people to look further afield than the regular returns offered by funds etc, no malice intended.
What you've got so far IS a decent amount and obviously you're proud of what you've got, as you should be, you are in the minority that will probably be wealthy very early in life.
A hell of a lot is possible with what you already have, don't underestimate what it can do for you already.

The golf answer is over $34.3 billion dollars...
Go forth and compound...