Is your portfolio in the red?

After the drop in the Dow on Friday, you would think you are in the hole. Everything is colored red. This causes some investors to panic and want to sell. They are afraid they will lose more money. Don't panic, these are only daily losses. The important thing to remember is how much you paid for your stock, and is it a solid company paying a good dividend and going to bounce back when the indexes rise back up.
You have to remember, these gains and losses that show up on your portfolio are "Unrealized". It's just an indicator of how the stock did that day. Remember, you won't lose money unless you sell the stock at a loss. Then it would be "Realized" If the price goes down for a while, you should be able to collect a dividend on it until you grow tired of it or find a better investment. But don't sell it just because it goes down one day. It may show it is in the red, but you may actually be ahead. Hold on a couple days and you will realize you are doing just fine. Looking at the value of your portfolio is usually a better indicator of how you are doing than the losses and gains.
I'm thinking next week will be a good week. I plan on leaving my dividend collecting stocks alone and selling the rest to collect the profit and reinvest in the next stock I feel is right. Keep doing your research. Study the charts, read those financial statements. Don't feel bad about looking at the SEC website. There is money to be made, we should feel obligated to make it. After all, profit is not a dirty word. Take your profits and feel good. Reinvest with confidence. It may be a stock you owned two weeks ago. I feel like if I can make $100 in a trade after a few days, sell and take the win. It's better than waiting three months to make the same as what you collect in dividends. Have your next investment in mind so by the time your trade settles you may be ready to sell again. Then your portfolio value will increase regardless of your daily gains and losses. Remember they are just indicators and should be looked at but with consideration of the market that day.

Investment Soloist

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I'm back, still a soloist.

Well, it's been a couple of weeks since my last post. I had a real job I needed to do. But I am anxiously awaiting March to come so I will be through with the dreaded work force. I'll turn 51 before it happens, so I feel very lucky to have this extra time in my life to focus on things that are really important, home and stocks.
The last time I wrote, and as far as I know there hasn't been anyone reading, I was hoping for a correction in the market. Well, it happened, but not the way I anticipated. Actually I am in awe of how the market has been progressing. The Dow and S&P were way down yesterday. I took advantage of some bargain buying. Today, we started off bad but ended up in the green, go figure. Two days in the last two weeks were similar. People who bought on margins selling off to break even because they borrowed money to buy oil and then the price drops. Another day when traders seemed to just be punishing the future's market. I still think stocks are over valued but I'm still making money.
Some stocks I'll wait for dividends while most stocks I'll see a profit and take it. That's right, why not take the profit and pay the capital gains tax and move on to many trades rather than wait three months to earn a profit? It's working for me. I mean, there are over 5000 stocks calling out "BUY ME" everyday. Why get married to one? Take your profit and go on to your next investment.
I can see people getting into bonds and mutual funds if they are saving for retirement or are already retired. Believe me, I'm not trying to be a bull or a bear, I just don't want to be a loser. (That is another one of Dad's sayings, he has a bunch of good one's).
So, I'm bought and sold out this week and waiting for settlements. Mainly because I deal in cash, I would never use margins. Thats a sure fire way to be a loser.
And, avoid OTC, Pinks and single digit stocks. Always make sure you have a decent dividend to fall back on in case you have to bear it for a while, and always take your profit.
I like short, it works for me. I don't expect everyone to agree. And I mean short term, not selling short by borrowing shares, selling them, and betting on them to decline in price then buy them back and give the shares back to the broker. Thats like a margin in reverse, and no one know what's going to happen, but I won't bet on something I think will lose unless it's a horse.
And they only have Win, Place and Show, not LOSE.

Investment Soloist

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Do you feel all warm and fuzzy?

OK, Today was the day. Today was the day Mr.Bernanke held the first press conference in Fed's history. It was also closing day on a property I was trying to sell. So, I had to DVR it to watch it when I got home.
To make a long story short I sold most of my stock several days ago and collected profit. I was expecting the worst, because it sure feels that way some days. I didn't blog last night because I was so involved in all of the scenarios that today's press conference may bring. I even had to cancel my therapy appointment for the second day in a row. Occupational therapy on my hand from carpel tunnel that went bad. Thought you had me, huh?
Anyway, I was in the closing while a tv set in the other room was showing the press conference. I was missing it. As soon as I got the check, I ran out and stopped at the TV. The Dow was up. So was the Nasdaq and S&P 500. WHAT HAPPENED? I called my friend Sam on the phone because I knew he would be able to tell me. You see, Sam used to work in the market and has forgot more about securities than I have even learned. He said "Well, it was a good report, so that's about it". I also realized it was my turn to buy lunch for Sam. We take turns buying.
So now I deposit my check and send my funds to my online broker and get home in time for the market to close. I can probably buy some of it back for less than I sold it for, but may have to wait a while for others.
But it occurred to me, "I don't feel warm and fuzzy". To me with the price of gasoline at $4.09 a gallon, and food prices up, and gold at an all time high, and no one said interest rates won't rise, why should I feel good about this market? I know Friday I am receiving dividends on 1400 shares of financial stock, but I don't even like the stock. I feel like stock trader dearest, "NO OTC STOCKS, EVER!" "NO PINK SHEETS, EVER!" "NO SINGLE DIGIT STOCKS, EVER!" Whew. Perhaps, since this is earnings season, and after all the earnings are paid, there will be a 10 - 15% correction in the stocks? Hummmmmmmmmm. I never thought of that. But, as any knowledgeable stock trader will tell you, never panic. Usually that is the case when you have the urge to sell, but panic to buy? I need to get a grip. There is no warm or fuzzy feeling going on. Perhaps it's my sleep apnea, my mask doesn't fit right, or I am spending too much time on the treadmill, maybe it's all the rain that came through the roof I had put on six months ago and damaged the ceiling, I know, I'm trading two houses for one but I really need a vacation. Yes friends, I am freaking out. Maybe it's the money I lost on a stock I sold on purpose just to get a break on the capital gains tax. Or unemployment, global warming or universal heath care which I support. You probably were thinking I was a little right while I'm really a liberal with strong ties to profit.
Today didn't make any sense to me at all. I will be up all night trying to figure out what the warm and fuzzy feeling is all about and why don't I have it.
My Dad always said, "You can be a bull, or you can be a bear, just don't be a hog". Truer words were never spoken. I believe that was his motto. Jim Cramer said hogs get slaughtered. He is right. In fact, he is a brilliant man, I watch his show occasionally but the bells and whistles are a little much. I think the stock God's went crazy, or I did. I need to regroup.
Till next time.


Investment Soloist

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Investor or Speculator?

Whether you consider yourself an investor or a speculator, you are basically performing a similar task.
Investors take their money and put it into something they hope to profit from. Profit could be in the form of dividends, capital gains or interest. They invest in bonds, stocks, commodity futures or any security they feel has the least risk and highest yield. Many investors buy and hold their assets for years.
Speculating is a investment in hope of gains that is far more risky. Many of their investments do not pay dividends. They analyze the risk and if they feel assured money can be made, they will invest. Most speculators risk their own money, so to reduce the risk they may form a hedge that will help protect their capital. Many day traders will invest in a stock and own it a few seconds or just a few minutes while other speculators will invest in a commodity that may take some time to grow.
If you invest, you are a speculator. You make sure you are investing your money in a way that will be profitable. After all, the objective is to increase your earnings.
With Gold surpassing Fifteen Hundred Dollars for a Troy ounce, there are people who are speculating the price will keep growing. And with the US Dollar devaluating and a possibility of interest rates rising, I can see why they would think that way. But many investors don't have enough money to invest in such a high priced commodity. So many are turning to another alternative, Silver. Since Silver is trading at about Forty US Dollars a Troy ounce now, that is more attractive to the average investor. But, there are others that are speculating that someday the price will come down and do not want to put their money there at all. Who's right? Who knows. One thing for sure is we will eventually find out.
Most of the speculating today was, "What will Ben Bernanke say in his address on Wednesday, April 27, 2011?" We will go over that on Wednesday evening.


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To invest or not to invest?

It is astounding to me how many people do not invest their money. Even if you have a passbook savings account or CD, you may feel like your money is growing, but is it? Putting your money in the bank is like giving the bank a low interest loan. My question is, "why not invest your money and watch it grow?"
There are many reasons why people don't invest. Some think it is too risky, others think they are not capable of managing their own investments. If you do your homework and pick your investments wisely, you will find you can increase your wealth dramatically in no time at all. Don't be fooled by the financial analysts you see on TV talking in terms you may not be familiar with. It's not that hard. In fact, they use these terms to intimidate you into thinking "I'm not able to do this myself".
Another thing you have to remember is if you take them your money for them to invest, they may use your hard earned money to benefit their portfolios instead of yours. That is why I urge people to start off with an online brokerage account. Try to find one that not only offers less expensive commissions on trades, but have offices that you can actually visit if you should want to.
There are the high end brokers that will offer you donuts and coffee when you come in and advise you on how to invest your money, but really, do you think you need that? NO! Your mission is to earn the most money for yourself. Don't listen to someone who is trying to sell you something. Trust me, you are not stupid. You are able to do a little homework, look at reports on companies and determine if a stock is worth investing in. But remember, don't get in a hurry. Knowledge is power, and when it comes to your money, you need as much knowledge about your investments as you can possibly get.
Some people think "I don't have enough money to start investing". Most online brokerage firms will open your account for as little as $500.00! But as the old saying goes, you need to have money to make money. So the more money you get started with the more you can make. I want to see you make as much as you can.
So, if you have any reservations about investing, you need to rethink your financial situation. Perhaps you should be asking yourself, "Can I afford not to invest?" It's never too late to start and I would like to see you do well. If other people can do it, so can you.

Investment Soloist

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Welcome

Welcome to Investment Soloist Blogsite. Our mission is to share information and encouragement to those who trade in securities. We hope to do a daily blog as our time permits. I hope you will find our personal ideas and strategies useful in your trading experiences.

Happy Easter



Investment Soloist

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Investment Soloist

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