Investment Options

[JJReyes]

All those fees that JJ speaks of are why I go direct to the stocks myself now.

 

Mutual fund companies collect their fee daily, which is a fraction of 1% or 1.5% or whatever is their stated fee.

 

My ONE that I still like, but currently am out of is CIM (Chimera Investment) a REIT (Real Estate Investment Trust) that is currently paying 11%+ in dividend and has good potential to appreciate.

 

Chimera Investment so far has been a good REIT. The system operates similar to a limited partnership agreement. The dividends are not taxed at the corporate level. REITS are taxed at the individual shareholder's level.

[jpbago]

Actually the funniest part of investing for me? I know a couple stock brokers. Now these are guys who have more money than they know what to do with and couldn't care less about working any more.

 

Not only do mutual companies charge management fees and sales commissions (depending on how it is loaded), the sales person gets a trailer fee every year forever as long as you hold the fund. Trailer fees from 10,000 customers can be a lot of money. It's a pension.

[stevewool]

I am from the USA and here are my plans, not fully implemented yet.

 

I will be moving my tax deferred retirement savings (US 401K) to a self directed IRA (Individual Retirement Account, still tax deferred until withdrawal).

 

I have about 20% of my retirement in my old condo which I will rent out for about a 5% return, plus it will help protect me against monetary inflation.

 

The retirement savings I plan on putting 20% in emerging asian markets (excluding japan), another 20% in emerging Central/South American markets, another 20% in a hard asset/commodity fund, the remaining 40% in a more traditional mutual fund targeted towards long term dividend paying stocks.

 

I can do this in the USA by purchasing mutual funds or EFT's (Exchange Traded Funds) matching those sets of criteria.

 

Reading into my choices you can see that I am not bullish long term on the US economy, at least not for the next decade or so.

 

I prefer to use mutual funds or EFT's rather than purchasing individual stocks. I don't want the job of micro managing a portfolio during retirement.

Even though I've moved to more like JJ thinking... Good plan!  I may use the ETF to get into foreign markets if I don't find something I am comfortable with.  I DO prefer to manage the individual stocks NOW that I have done it for a while over keeping track of who is in charge of a fund and wondering if I should change when the manager does.  You keep doing what works for you AND to those without a plan: GET ONE! :bash:

 

> 

I prefer to use mutual funds or EFT's rather than purchasing individual stocks. I don't want the job of micro managing a portfolio during retirement.

 

Years ago, I had a similar attitude, Mutual funds were my "buy & forget" investment strategy. Let all those financial geniuses take care of my money. After the 2008 economic collapse, I did a 15 years look back and found out those 1% to 1.7% fees had costed us between $50,000 to $100,000. The average performance of all those financial geniuses were no better than the Standard & Poor 500. Yet they collected fees whether or not they made money for you. In addition, the mutual fund companies made trades, sometime 3 or 4 times a day and there were charging huge fees for each trade. 

 

What made money for us were DRIPs (Dividend Re-Investment Plans). We bought stocks directly with participating companies. Most of the money went into oil company stocks. You couldn't time the trade, but if you had extra money at the end of the month, send them a check for $300 or whatever and they will buy additional shares. A few were emotional stock purchases. I bought Wrigley's chewing gum because every shareholder on record received every year a box of chewing gum as a gift.

 

We sold all our mutual funds in exchange for self-directed IRAs and a joint trading account. Although our portfolio adjustments are every six months, I like getting up at 3:30am for the opening bell at the New York Stock Exchange. Then it's a phone call to my wife from the office after the closing bell to let her know if it was a good day or bad day for us. A little crazy, but fun since it's paper profits or losses.

 

On an annualized basis we are doing better than mutual funds. Everyone in the family still has Berkshire Hathaway B shares, including our granddaughter for her college fund. The reason is because it is really like a mutual fund, but there are no fees involved. Warren Buffet is probably the world's greatest and most consistent stock picker. If you had purchased one "A" share for $ .25 when he first started, it would be worth something like $150,000 if you sell it this week.

I'm with this except the DRIPs.  Have never tried that, yet.  I dumped the mutual funds for individual stocks.  Won big on some and lost a bunch on some, because I got greedy.  Overall I am AHEAD of where any mutual fund would have me right now (roughly +10% return over the last 3 years) and I was in some good ones with USAA FSB.

Thanks for all the detailed response to EVERYONE in this thread... It helps to know others approaches and perspectives. :tiphat:

 

it sounds to complicated for me guys, all i know is that i have 1 house to rent out and a guaranteed income from that.

savings in both our names up to the maximum that is safe and another account with a building society that is for emergencies, so all in all for me its cash that i can see that counts, these figures do not include state pensions and private pensions, i am not claiming them yet so to me they are not real, so not counted in future figures.

I try to work out on figures that are real to me and at this moment cash is king.

Uts just my way off dealing with things, as they say each to there own

Best of luck with the guaranteed income.  :thumbsup:  The laws in the US (state of Illinois anyway) make things difficult for the owner when the renter doesn't pay.  Took me 2 years with a court order and associated expenses with the LAST renter before I could collect.  That is when I dumped my rental properties. :cheersty:   IF I was in the area it would have been different, but I was an absentee landlord.

 

well i say guaranteed, my daughter is going to be the one who will be here renting it, the price we will agree will be put into my brittish bank account so i will be happy and so should she too

[JJReyes]

Not only do mutual companies charge management fees and sales commissions (depending on how it is loaded), the sales person gets a trailer fee every year forever as long as you hold the fund. Trailer fees from 10,000 customers can be a lot of money. It's a pension.

 

Continuing trailer fees or residual commissions is what I am working to accomplish during my semi-retirement years. Once the system is up and running, I will turn it over to our younger son to manage. My wife and I will take 40% after expenses. The project shall remain nameless. It is still at the planting seeds stage, which means nothing but expenses and no income. The situation will improve by 2014, assuming my projections are correct.  

[Thomas]

When they can afford, it's common that Filipins (abroad workers) put their money in land,

or parts in  mango trees, because they don't give any harvest in the beginning when the worker is still working but then more and more, so they see it as a good "retirement fond".

Same topic but different sub-category:  Is anyone here investing, specifically stocks, in a country other than YOUR origin?  I'd like to hear about other investments also, but I am most comfortable with stock investing so may use information here to pursue that type of investment later on myself.

So far I have only invested in Swedish companies with business abroad,

but some years ago I checked stocks in Thailand, because a thai woman wanted me to teach her, and then I chosed business branch, she added local knowledge of such companies and then we checked them. Some were crap, but we fast found several companies with PROFITS at around 12, 23 and 31 percent in a year, so good chance their shares will develop good.

A while ago I made an overview check of the Philippine stock market for a longer period (including the fall 2008). It has developed MUCH better than the American and European stock markets. (I have posted the values in an other topic in this forum, I don't remember which topic.)

But better LIVE in the country where the company is, because biger chance the news will tell important things then, mainly if something BAD happen, so can hurry to sell before it fall to much. (But some such news can be badwill, but not realy give effects of future profit, so some bad news are BUY signals   :)   

 

(After move I suppose the main parts of my capital will be tied in house and business equipment, but some businesses have very irregular cash flow, and then I suppose I will put money in the Phili stock market until they are needed again, because stocks are faster moneyticed than my other things   :)

 

I would AVOID buying normal fonds, because they demand pay* even when they do BAD investments!!! And many of them do BAD investments...  :(     If not want to do investment work, then better chose shares by random...   I recomend reduce risk by chose from different business branches. although I don't follow that recomendation myself   :hystery:  When I find one I believe will be a big winner, then it's common I put all my money on one. Risky but more thrilling. I "play on the stock market" instead of bet on horses    :dance:  

 

( *One of my business ideas is starting a "fond" open for investors, with NO PAY to us handlers if we don't beat index. (=Handler get share of PROFIT part.) But it's much more complicated to start such than starting a common company, so it will probably not be the first I will do. But perhaps I will change my mind, because I discus a cooperation with a businessman, who sell his old company to a multinational company now, and is starting up business in Phili. We have suiting oppnions about helping poor Filipins to develop (localy), so I suppose some such will be included too.)

[GregZ]

I recomend reduce risk by chose from different business branches. although I don't follow that recomendation myself :hystery: When I find one I believe will be a big winner, then it's common I put all my money on one. Risky but more thrilling. I "play on the stock market" instead of bet on horses :dance:

 

That is MOSTLY how I am also.  I diversify a LITTLE.  BET BIG to WIN BIG.   :36_6_3[1]:   It is fun and so far I haven't been hurt. :kidding: