Hi Welgard
Do you consider it a good time to enter into that fund for both price and dividend gains?
What are your goals? What are your needs? Have you upgraded your present portfolio? How many securities do you currently own? Do you know everything you can about each security in your portfolio? Are they all doing as you expected when you bought them?
In answer to your question.
Time will tell. I can’t tell you it’s a good or bad time to buy or sell anything. Because I don’t know.
I told you what I did. I told you what I own I told you what results I’ve had.
I don’t know what tomorrow will bring.
It takes courage to do this.
b&w
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hi b&w:
maybe I am not understanding this correctly. Please correct me if I am wrong. You say that in 13 years, you made X11 your initial investment (that is without adding capital?) after expenses.
so that is an average annual return of almost 22% per annum which is a remarkable return especially so if you are stressing income as you say. You also say that you rarely transact except I assume for pulling out the income you need at regular intervals.
You must have had a few big winners to have such a return, didn’t you?
How do you think you obtain such a remarkable return?
tj
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Hi TJ:
You say that in 13 years, you made X11 your initial investment (that is without adding capital?) after expenses.
I had no money to add-I retired on July 1 2003 with no pension and not much SS. In fact I had burned through my retirement capital by Nov 2008–Which was During the financial meltdown of 2008-9. My portfolio bottomed on March 6 2009
so that is an average annual return of almost 22% per annum which is a remarkable return especially so if you are stressing income as you say.
I don’t use averages because averages lie. If a room has 10 women in it and one is pregnant that doesn’t mean that each women is 10% pregnant. It means that one woman is 100% pregnant and the other 9 are not pregnant
On March 6 2009 my portfolio bottomed at a 30% gain after after spending the initial capital For example initial portfolio July 1 2003 $100 Nov 2009 spent entire original portfolio and when the portfolio dropped at the lowest point on Mar 6 2009 it had $130
You also say that you rarely transact except I assume for pulling out the income you need at regular intervals.
I don’t sell and buy just to do something. I will add to positions on a regular basis Most (over 50%) of income is not needed for living expenses so it is dripped into additional shares creating growth. Most stocks have growing distributions so there is a rising bias to share prices(sometimes) I remove cash when the checkbook says give me more money.
You must have had a few big winners to have such a return, didn’t you?
Yes----The winners only got the money when they performed well for me. They competed for every dollar they got from me by the performance they did. They increased the dividend or the price nudged up they got more money. If they didn’t do well they got booted out.
How do you think you obtain such a remarkable return?
Focus Discipline-Set goals
I have a portfolio with few stocks(8) So I can learn as much as I can about them. I don’t trade much -Keeps transaction costs low
I don’t seek capital gains–It would require paying additional taxes. My largest taxable event most years the RMD’s I have to remove from my IRA’s If I take capital gains I give up a big part of the gain to the FED and STATE and all the dividend/distribution income from that investment. Then with the net cash proceeds after taxes I would have to seek another investment that will pay me less than before because I would be investing less cash (net proceeds) then I had before. The bulk of the received income is tax deferred either partially, or mostly and around 50% currently reinvested for future growth in the portfolio.
For every $1 I spent in 2003 the year I retired, I spent $2.69 in 2015. That is about a 7% annual inflation rate. And that includes everything I spent including FED and STATE taxes. So for anyone thinking of retiring some day, don’t forget inflation
good luck
b&w
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I was just wrong, sorry.
I did remember paying a higher tax rate on some dividends, but it looks like that happened because I hadn’t met the holding period requirement to get the lower tax rate.
Hi B&W
Just wanted to check one thing with you.
I don’t seek capital gains–It would require paying additional taxes. My largest taxable event most years the RMD’s I have to remove from my IRA’s If I take capital gains I give up a big part of the gain to the FED and STATE and all the dividend/distribution income from that investment.
If you were to imagine you weren’t American but could trade US instruments as you do from a place like Singapore which has zero capital gains tax and zero inheritance tax but does have on the other hand dividend withholding tax, how much would that change your strategy and selection. Frankly 11x in 13 years is so bigly huge that I can’t see that many alternative strategies matching that without bigly huge leverage.
What you are proposing makes sense to me but it challenges my conventional investing thinking that I’m better served from an opportunity and taxation point of view targeting income investing in the UK whether they have been ex growth for 50 years and pay high yields and instead target capital gain in the US where they still have a high growth rock star economy that prioritises capital growth over dividend payouts.
Ant
Hi Ant:
Frankly 11x in 13 years is so bigly huge that I can’t see that many alternative strategies matching that without bigly huge leverage.
First of all–I use NO LEVERAGE. I OWE NOBODY ANYTHING–My credit card bill gets paid in full monthly – No Home Mortgage No Car loan -NOTHING.
Next-- You are making an assumption that this is the peak valuation which is false. 2 years ago it was 15 X in 11 years.
In total my portfolio is IMHO very depressed- However in those 2 years I have spent about One times initial capital and my projected dividend/distribution mostly tax deferred annual income has more than doubled to a point of where all my expenses including FED and STATE taxes consume a little less than 50% of projected income leaving me about 50% to reinvest for additional income to pay for the inflation that keeps coming.
What you are proposing makes sense to me but it challenges my conventional investing thinking that I’m better served from an opportunity and taxation point of view targeting income investing in the UK whether they have been ex growth for 50 years and pay high yields and instead target capital gain in the US where they still have a high growth rock star economy that prioritises capital growth over dividend payouts.
I don’t know what the tax laws are where you are. But I can tell you, if you want to be more successful in your investing for you and your family you best learn what the tax laws are, AND STOP THINKING CONVENTIONALLY
The important metrics are
- how much after tax dollars you have to spend
- how to keep as much as the pre-taxed dollars growing
3)converting pre-taxed dollars to after tax dollars as needed at as small a cost as possible.
I have found there is a lot more to this investing business than just buying a stock because your friend bought it, and it went up. Thousands of stocks go up.
b&w
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