could you expand on why you sold out PAYC? eventually any (SaaS) growth will slow. But if the SaaS can still produce its recurrent revenues, why sell PAYC?
Hi tj, Getting out of Paycom may turn out to have been a mistake, but here’s what I wrote in my August End-of-the-Month post: Paycom is a company I had had for a long time and liked a lot, but there comes a time when even the best of friends must part. It’s growth has been massively slowing, and in addition they have had to increase their R&D spend massively (up 80% to 100% each quarter), but the big thing is that they only seem to grow by opening more sales offices, and with that you get the restaurant syndrome (when you have 25 offices you can add 5 and grow by 20%, but when you have 50 offices, adding 5 only gets you 10% growth, and how can you keep adding more and more offices each year. I was sad, but I sold out.
I gather than you got seduced by SKX growth but that stopped abruptly. The retail sector has not been good over the past year. Would you say you do ‘sector timing’?
I don’t do any “timing”. I think retail is not going to be good for the foreseeable future with the exception of on-line retail. Look, my wife needed some blouses and various pieces of underwear. In the past she would have gone to a store and struggled through trying to find things she likes. (She HATES shopping). This year she just ordered them on amazon and they’ll arrive in two days. No sweat.
Skecher’s ignored the trend and kept renting expensive showcase stores, which cost lots of money.
Yeah, my wife could just as easily be American and possess the same ignorance. The only reason I mentioned it is that the entire concept of investment is unfamiliar to the vast majority of Chinese. They understand saving, but investment is an alien concept.
An American (or for that matter, most middle class western women) are at least knowledgeable of the concept of investing, but possible disinterested in the topic or feel it applies only to the wealthy.
You raise a fascinating point. Your wife hates shopping. But others enjoy an outing to look at clothes, feel their material, see new ideas, come home with something. I think that is typical: it’s fun (much like the anticipatory wait for photographs and the family inspection of them. Was it not fun? Is it all over? Is there now no girl who wants to go shopping? Amazing.
I see my sector list has just one entry under ‘Retail, general’: a cinema outfit. (Popcorn is a gratifyingly outrageous price). Nothing else. And even that is virtual in a sense.
How do you generate 7.5% from a portfolio if you do not realize capital gains?
hoe much your portfolio has grown since 2003 when you retired?
My portfolio has gone up since the last time I figured the return . The current annual figure as of today’s market close is 7.203%
I have discussed my portfolio many times on this and other MF boards. This is Saul’s board and I am not in competition with him or anyone else. If you are seriously interested please send me an e-mail and I will try to answer your question privately.
I wonder if there’s a way to kind of split the difference???
What other information resources do you follow?
I don’t understand what you mean by split the difference?
I don’t follow any informational resources—Because I rarely trade, so I don’t need a lot of new stocks. In fact the only new one I’m buying and adding to lately is MIC which IMHO is hugely undervalued. A distribution growing at 10% per year that has been 65% tax deferred Currently yielding 7.6% 2 years ago MIC was an $87.9 stock with a dividend of $4.28 Today it is selling for $72.60 with a growing dividend currently at $5.52. Management has guided for a $6.11 dividend in 2018. Plus 10% a year after. I think this could (in a co-operating market) be a $120-$130 stock in 3 to 5 years. If it happens I will more than double my money because I am adding as it goes. I have more shares by adding and dripping and as the dividend rises it forces the price up. If it doesn’t go up I will have more shares paying a higher dividend and maybe only make 30% or 40%. If bad news comes out—Guess what—I know how to sell, if I need to. I’d rather not, but if necessary, I will.
the market cannot go up faster than the economy as a whole True, but sectors of the economy, and the stock of companies that are powering those sectors, can go up faster than the general economy for a long time.
Yes the Bear will come. But nobody knows when. The very best possible is to be able to avoid a part of it.
There are many that work. Sauls’s is but one
actually multiple studies have shown that there are very few definable schemes that work much better than B&H an index.
In don’t think there is a excessive amount of “gloating” on this board. I do think that many who are theoretically OK with losing half their fortune in a few months will find it a lot harder than they think when it actually happens. The bottom will coincide with a general mass mood that stocks will never go back up ,and few of us are immune to that. Seeing your retirement age go from 55 to 75 has a chilling effect, making you less likely to want to extend that date to age 85. Been there done that…