SDMB Money Talk

Miscellaneous and Personal Stuff I Must Share
1

In this thread, we are discussing the merits of prosper.com. Since there is a fair number of financially savvy Dopers out there, I thought I would start a little roundtable. Fair game for discussion might be:

[ul]
[li]What kinds of assets do you like to play with? Do you have an industry or specialty?[/li][li]How’s your ROI looking? How are you weathering today’s conditions?[/li][li]OMG Bear Stearnz![/li][li]eTrade? Scottrade? Sharebuilder? Your brokerage of choice.[/li][li]Where’s your high interest savings account at? Or do you prefer CDs?[/li][li]Interesting online or offline investment resources.[/li][li]Any big wins or bad beats lately?[/li][/ul]

Only one thing strikes me as being positively out of bounds: exactly how much you play with. If you bought Delta at $9 and sold at $15, please crow about it and tell us your reasoning. But nobody needs to know whether you made $200, $2000, or $200,000.

I’ll give it a little time before I weigh in with my own (sob) stories to see if there is enough interest.

2

This might also be a good place to discuss reading lists. I can’t post mine right now as I need to go to class, but I’ll have something a little later today.

3

As far as reading lists go, top of mine is Liars Poker, by Michael Lewis.

4

Like many lawyers who have done financing deals, I have a couple of deal cube Bear Stearns Teddy Bears looking down on me. They seem complacent and declined to comment.

I’m not fast enough to market-time–by the time I make up my mind to protect this house and get to my computer, the S&P is up 4.24%. Dead Bear Bounce?

Srsly, here is a contribution to the debate I got from an old timer (40 years CFA)–he says the thing to do when there is real turmoil (swings of > 2% day to day) is do nothing–there is no way to rationally determine which way it will swing next when it is like this.

5

Short term turmoil is often good for the long-term. When the S&P took a big dump on March 10, I transfered $5 grand from my savings to VFINX. My index funds are all for long-term investment (the only time I’ve sold shares is when I was unemployed for a long stretch) so I make purchases whenever there’s a slump. So far it’s worked out pretty well for me.

6

My net worth is now above zero (no debt after seven years of slogging!) and I can actually pay attention to this stuff now. Over the holidays, my friends introduced me to the Dave Ramsey school of thought, which I am broadly following.

Basically it talks first about insulating yourself from borrowing for unexpected short-term and urgent needs by putting a pad of money aside. Only when this is achieved does it talk about getting out of debt. Then, once you are out of debt, you can then start in on investments and other activities.

I wish I’d known this earlier; I did it backwards and as a result paid way more than I needed to in borrowing fees when I didn’t have reserves of my own. Even 4% in a savings account while you are building up your reserves is better than receiving 10% from an investment while you are also paying 15% on borrowing equal amounts to stay alive.

These are the kinds of foundation steps that need to be done before one can start seriously investing.

Me, I tend to take the largest view of investing. I guess I’m the opposite of technical investors who look only at charts. There’s the looking at a company’s fundamentals, true, but it’s as important to look at society’s trends and fundamentals.

I’m betting that investments that improve efficiency will prosper in the long term more than those that require profligacy to function. I’m planning my future around this: not just “investing”, but career choice and more.

7

The Visa IPO is tommorow. If I had funds, I’d be dumping some in.

8

In this thread, we are discussing the merits of prosper.com. Since there is a fair number of financially savvy Dopers out there, I thought I would start a little roundtable. Fair game for discussion might be

[QUOTE=Maeglin]
What kinds of assets do you like to play with? Do you have an industry or specialty
[/QUOTE]

Stocks mostly. I like the beverage market (Pepsi and Fortune Brands) I like foreign tech (China Telecom) and I’m heading to the African market next. I’m messing a bit with financials (E*Trade). Oil is a nice playground, I have a couple ETF’s an aggressive bond fund, a money market, and an IRA. I have some gold I uh, picked up, recently and I’m trying to find a way to get it into the value of my IRA without selling it and without paying some shyster.

[QUOTE=Maeglin]
How’s your ROI looking? How are you weathering today’s conditions?
[/QUOTE]

Doing dandy since the beginning of the year, I am. 8.5% and rising since Jan 3rd.

[QUOTE=Maeglin]
OMG Bear Stearnz!
[/QUOTE]

Meh.

[QUOTE=Maeglin]
eTrade? Scottrade? Sharebuilder? Your brokerage of choice.
[/QUOTE]

**I’m with both Sharebuilder and Scottrade, where I own some of E*Trade. I think their new CEO has his hands full, but with better than 20 years at JP Morgan, I think he can handle it.

[QUOTE=Maeglin]
Where’s your high interest savings account at? Or do you prefer CDs?
[/QUOTE]

IMO, CD’s are for people with not a lot of time to spend investing, suckers or really rich cats with time to waste. I’m in WAMU, ING, and Schwab. I can get it fast and move it at will with no hits. What I lose in points I gain back on the move. **

[QUOTE=Maeglin]
Interesting online or offline investment resources.
[/QUOTE]

Actually, I use TheStreet.com, Morningstar and Google.
Google finance is simple-stupid, therefore I like it, plus it’s awesome.

[QUOTE=Maeglin]
Any big wins or bad beats lately?
[/QUOTE]

Not so far. As long as people like an ice cold pepsi with or without their Jack Daniels, and they need oil to make the gas that they put in their cars and as long as the Chinese keep on making more people to buy cell phones, I’m pretty much OK. I prefer medium aggressive with a little safety, but I’m too young for the bond markets, plus, they bore me.

[QUOTE=Maeglin]
Only one thing strikes me as being positively out of bounds: exactly how much you play with. If you bought Delta at $9 and sold at $15, please crow about it and tell us your reasoning. But nobody needs to know whether you made $200, $2000, or $200,000.
[/QUOTE]

You are NO fun at all. :wink:

9

This may be the wrong time for me to talk about money. :frowning:

I’ve got a 401k which I’m keeping in a medium level of risk for my long-term retirement needs. It did fairly well, but had taken a bit of a hit recently. Still, I’m in that for the long-run and not too worried about the ups and downs.

We did quite well with some individual stocks in Taiwan last year, but got hit when the Taiwan market crashed in the fall. We then moved a significant amount into cash (in dollars) since we’ll need to make a down payment this summer on our house. Unfortunately, the dollar has deteriorated against the yen, and so we lost some on that. The forecast for the yen doesn’t look good in the short term, so we’re selling dollars now to prevent further loss. Oh well. You win some and lose some.

There are indications that the dollar will continue to weaken, which complicates my investments.

My wife has New Zealand dollars which did well against the yen and we’re also converting back to prevent a back-slide

We’re still into a few high-risk Chinese tech funds (with a limited amount) which have done well. We’ll keep those for now, while we continue to watch them.

10

[QUOTE=Humble Servant]
Srsly, here is a contribution to the debate I got from an old timer (40 years CFA)–he says the thing to do when there is real turmoil (swings of > 2% day to day) is do nothing–there is no way to rationally determine which way it will swing next when it is like this.
[/QUOTE]

Indeed. This is where I find myself now. My industry of choice was specialty finance. My fencing master is fond of saying, “when in doubt, get the hell out.” So I did (save unvested company stock) a few months ago, and now I am kind of hurting.

My 401(k) is doing quite badly overall: my ROI is on the wrong side of the axis, driven down largely by my shares in the company stock pool. Fortunately I do not work for Bear: our shares are down only about 25%.

So right now, I am doing nothing. I just bought a few books in preparation for investing outside my comfort zone, but for now, I am sitting out.

11

In my 401(k), I’m about 85% in an S&P 500 index,15% in one of the pre-built portfolios that has a mix of bonds, reits, gold, etc. Total about even so far this year, meaning I’m losing about as much as I’m putting in each month.

In my IRA, I’m about 10% S&P 500, 90% EAFE index.

I keep my emergency fund/cash in Wamu @ 4% (likely lower, soon) and in another online bank that has a good cash-back credit card if you have a certain balance. It’s now dropped below 3.5%, so I may ditch that and look for another credit card.

Total, I’m about 10% EAFE, 8% mix of stuff, 60% SYP500, 22% cash I don’t pretend to know enough about individual companies or even industries to make an intelligent decisions about single stocks, and I know the dangers of managed funds, so I just throw it into index funds. I probably should be more diversified, but the options in my 401k suck greatly, and my IRA just isn’t big enough to support more than one or two funds, yet. I’m keeping a decent amount in cash because I think I might be wanting to buy a house sometime in the next few years.

I use Scottrade for my brokerage. While they’re no longer the cheapest, they’re cheap enough, I’ve had no problems with them, and it’s not worth the hassle of moving to save a few bucks on the maybe three or four trades a year I make.

12

Industry sectors that look good to me right now are:

Utilities - look for power companies with a 50+ year history of paying dividends. There are a fair number of them paying over 5% and are also at, or near, their 52-week low. Tampa Electric (TECO) is one of them I’m considering right now. Along with Consolidated Edison (ED).

Small Telecom providers - lots of them also with long histories of dividend payments and returns of over 7%. Citizens Communications (CZN) is a recent purchase and is currently paying over 9%. Fairpoint Communications (FRP) is paying a much greater dividend (~16%) - maybe, but it’s dependent on approval of the pending acquisition of the Verizon (Spinco) networks in New England. And time is running out on that. The ex-dividend date is passed for this quarter’s payments anyway. Something to look at for next quarter. EPS is awful low at FRP right now, so that’s also a pretty big downside. Verizon itself (VZ), though, looks pretty good right now; paying 4.9% and closed right at its 52-week low, EPS and P/E are reasonable.

Sectors that look like shit: Biofuels, particularly ethanol manufacturers. I own some Pacific Ethanol (PEIX) (not much thank gawd) that I purchased last year at about $12.50. It closed today at $4.33. A 67% loss in less than nine months.

My outlook right now is towards dividend-paying stocks. General Electric (GE)even seems as if it might be a good buy again. Guess maybe I’m a bit ass-backwards here; I’m invested pretty aggressively in growth funds in my 401(k) and pretty conservatively in my brokerage account right now. Although I’m pumping 75% of my 401(k) contributions into a Roth 401(k); that should help me a bit on the far end of things - pay my taxes now and be done with it.

I use Scottrade exclusively for my brokerage transactions.