Investing/Self-promotion for Blog

Unknown

This forum is so cool! I'm glad I found it.

As a poker player, I'm trying to consistently play winning poker. I know that I am winning at the limits I play at because I've taken out any money I've initially deposited into poker sites. I'm only playing with my profits and it's slowing growing.

I would love to be able to play poker regularly "for fun." I wouldn't want to play it to replace my current salary or anything like that. I would want my investment assets to replace my current salary, so I don't have to work anymore. I wonder if there are other poker players that are thinking the same way I do. Poker's just one interest of mine, I would not be playing it if I had to keep putting money into it. Investing is probably more interesting to me. The thought of having more and more money work for me is my motivation.

Anyways, the link to my blog is http://sane0t0.blogspot.com/
I post on boxing, investing, but not much poker lately. I don't post regularly, but I figure someone might be interested.

Let me know what you think.

BBC Z

I think it's a great topic that poker players should know. Handling your money outside of the table (and what do you do wth the winnings?) can be more valuable than multitabling. Investing is currently my hobby that has superceded poker.

Anyway, as to your blog, I suggest giving some examples of stuff that you've bought. It's great to say that you are a student of Buffett and Munger, but unless you can put it into practise today, it doesn't mean much.

Value exists in so many different ways, that you really need to provide examples of how you are implementing it. If I see your portfolio is full of companies with castles in the sky, then I know I can ignore you. If you've got great ideas, share them.

The key to investing isn't to take risk, but to start early. If you've just won some massive online tourney, think about how you are going to make that money work for you. Einstein may even have called compound interest the "most powerful force in the universe".

Unknown

If you look at how a lot of the successful value investors that run hedge funds, such as Eddie Lampert. They do not openly disclose their investments, unless required by the SEC (through 13-F filings, etc.)

I think that it would be more valuble to talk about the "tools" I use rather than my actual portfolio holdings. All I can tell you is that value can be found in today's stock market, you just need to understand what you're comfortable with. I disagree that value exists in many different ways. It only exists one way, either the stock is cheap or it isn't. I think there are different ways of assessing value, which can be a little different for every person. Managing risk is important in any venture. In investing, using value assessment to determine the margin of safety helps to mitigate risk. There are never any guarantees.

I'll write about the web-sites and methods that I use to pick stocks. A lot of it is based on financial statement analysis.

Do you study value investing? One of my holdings is Northbridge Financial, a Canadian insurance company, under the Fairfax holdings parent. Reasons why I bought is that: return on equity is good, P/B is modest, investing strength in using its float.

BBC Z

If you look at how a lot of the successful value investors that run hedge funds, such as Eddie Lampert. They do not openly disclose their investments, unless required by the SEC (through 13-F filings, etc.)

Eddie's SHLDing like 4 billion dollars. Of course he's not going to discuss what he wants to buy. Do you believe that you have the same sway with the market? I'm not talking about writing up your position sizes, but giving investment thesis' of what you consider to be value are worth more than just talking in generic terms. After all, if I want that, I can read Peter Lynch et al. They've proven themselves.

I disagree that value exists in many different ways. It only exists one way, either the stock is cheap or it isn't.

In that case, isnt anytime someone buys any stock a value play? I mean, no one buys a stock thinking it'll go down. To me, value investing is finding solid companies in unloved sectors that are trading at a discount.

In investing, using value assessment to determine the margin of safety helps to mitigate risk. There are never any guarantees.

I'm not sure about this statement. A value stock and a growth stock are highly correlated, so I dont know if you have less risk. It's not like value is safer than bonds.

Do you study value investing? One of my holdings is Northbridge Financial, a Canadian insurance company, under the Fairfax holdings parent. Reasons why I bought is that: return on equity is good, P/B is modest, investing strength in using its float.

This was kind of what I was getting at. I personally invest in small-cap US through a combination of Motely Fool, CAPS, Yahoo Finance and 10-Q's. I'm not a fan on the canadian market being so resource/financial driven. Heck, you can just buy RY and enjoy 20% yoy returns :-)

Anyway, I'm more than happy to put up or shut up, so I'll include a list of companies I own.

50% Index funds
XMD.TO
VB

IBM BMO.TO RY.TO
BNS.TO PAC SCSS
PCA.TO VLCM DWSN
888.L UNH SDA
HURC NCTY WWE
MIDD IMAX TARR
AMTD GCE.TO NVT
CRYP TCHC FFEX
SHLD FMD PLAY
WLT BTUI CPSS
MLAB MWA-B

Also, I'm pretty active on CAPS at http://caps.fool.com/ViewPlayer.aspx?t=01003799766715739304

JimmyHo

Buy Cdn banks/ insurance companies and you can't go wrong long term. I personally like TD (which I hold). If you have kids, and hold shares outside your RRSP, put the shares in your kids name so everytime the shares increase in value to their personal limit, you can sell the shares and buy them back in your kids account and they include the gain on their personal tax return. As they have no other source of income, the gain will be tax free! You still have to include the dividends in your income (attribution rules) but you would anyways if the shares are held outside an RRSP. The second generation dividends do get taxed in your kids hands as well (dividends on reinvested shares). I think a lot of people don't take advantage of this opportunity and are paying a lot more tax than they need to. Just be careful if you are moving over shares that you already currently own as you will have a deemed gain on the accrued gain that you will have to report on your personal return. This strategy works better if you buy the shares and move them to your kids trading account on day one. You can always take the profits and contribute them to your kids RESP and get an additional benefit free from the government. Imagine the surprise on your friend's faces when you tell them your 2 year old filed a tax return

AcidJoe

don't overlook the value of technical analysis. I rarely look at a company's financial statement, only what the stock is doing relative to the industry and it's past performance. Personally I think gold is enjoying a long term upswing (although I recently sold off all my shares of XGD) and will probably buy them back shortly once things get right again. Tech right now (lead by nortel after it's consolidation) seems to be good.

I personally don't believe in investing for the long haul, I try to get in and out of stocks and make some money and cut my losses. If you have the time speculating like that is profitable. Momentum can be a powerful force within our greedy stock markets. No one likes to be left behind.

My only buy and hold is anything within my RSP which I try I keep bonds, stocks and interest bearing instruments in my own ranges. Also never overlook taking $25 or so a week (if your doing nothing) and just have it come out of your bank account and into your rsp you won't miss it but it beats trying to find the money in February.

I also right now thing Denny's (DENN) is heading to about $6US at which point I"ll get out of it unless things change once it gets there.

pkrfce9

joe, you are such an onion!

AcidJoe

pkrfce9 wrote: »

joe, you are such an onion!

As long as you put it on your denny's burger I"m good with it LOL

Unknown

pokerJAH,

I have been thinking about this stuff for when I have kids. So do you have an account in-trust for your children? Even if the capital gains or interest are above the personal limit for a child, it will be at a lower tax rate. I've researched RESPs and I love the idea of the gov't giving free money into the plan.

I'll need to look into creating a joint account for kids, in-trust. (if that's even possible)

Unknown

I've done some reading on Tech Analysis, but I have to admit that I feel more comfortable studying the approaches of Buffett and Prem Watsa. I don't think there's any real "right" answer to investing. If you're happy with what you're doing, then that's all that matters.

I try to follow the principles stated by Benjamin Graham, with added knowledge from super-investors. If you're interested check out this site: http://www.gurufocus.com/

ElElliott

Any advice on where (books, websites, etc) a complete novice could/should start?

BBC Z

I like fool.com. I also started with Peter Lynch's One up on Wallstreet and then got into the good stuff with 'The Intelligent Investor' by Ben Graham. Then you can read the Warren Buffet letters to shareholders http://www.berkshirehathaway.com/letters/letters.html.

JimmyHo

for all children under the age of 18, they cannot open their own investment account so the account would be "in trust" in your child's name. You can still have full control over the account and access to the account so you can make all their investment decisions on their behalf. As most trading is done online, it is very easy to have their account linked to your bank account so you can move funds into their account as needed. Any income earned above their personal limit would also be taxed at the lowest bracket, which may be benefical if you are in a higher tax bracket. Good that you are thinking about these things before you have kids, but you may find that your available cashflow will be depleted once the kids arrive.

ElElliott

BBC Z wrote: »

I like fool.com. I also started with Peter Lynch's One up on Wallstreet and then got into the good stuff with 'The Intelligent Investor' by Ben Graham. Then you can read the Warren Buffet letters to shareholders http://www.berkshirehathaway.com/letters/letters.html.

Thanks.

Btw....great to see you back & posting.

Unknown

For investing books, I would also recommend "The Warren Buffett Way" and the two books that Joel Greenblatt has written. Greenblatt has an amusing writing style. The Fool web-site provides a lot of info and one writer is IMO pretty good: Bill Mann.

"The Intelligent Investor" can be a very difficult book to read if you are just starting out. The latest edition with the Zweig commentary should be in your local library. The last two books I purchased were Ben Graham books: the intelligent investor and "Securities Analysis" and this was 5 years ago. I only borrow from the library and take notes now.

Unknown

I figured that the account would be "in trust". But in reality, I would probably be looking at RESP accounts first, and if there was any spare cash, I would open the "in trust" accounts. Who knows, I may not have any money left over after RESP contributions

JimmyHo

the RESPs are definitely the way to go with a free 20% from the federal government. Although you are restricted with the eventual use of funds, although saving for college/university is a good thing. Hopefully your kids will use the funds for textbooks and not online poker

ScoobyD

Thanks for the noob info guys, I've always found this stuff semi-interesting. Out of curiosity, what online discount brokerages do you guys deal with? The ones affiliated with the banks charge a ridiculous amount compared to most south of the border. I assume Etrade is about the cheapest up here?

BBC Z

I use www.interactivebrokers.ca.. $1 trades to US, $2 to CAD.

AcidJoe

ScoobyD wrote: »

Thanks for the noob info guys, I've always found this stuff semi-interesting. Out of curiosity, what online discount brokerages do you guys deal with? The ones affiliated with the banks charge a ridiculous amount compared to most south of the border. I assume Etrade is about the cheapest up here?

You are 100% correct. My self directed RSP is with TDwaterhouse. I do like the way they handle their site, it's easy to follow, up to date and fast. Downside is the $29.00 commission minimum.

Etrade is $19.99 or $9.99 if you have over $50K in assets with them, or execute 30 trades/quarter.

I personally feel better with my RSP money being with a Canadian Bank Despite their constant raping of their customers.

AcidJoe

For those who are interested, Denny's just broke through the $5 mark and is up approximately 8% on the year. Apple skyrocketted on the news of the iPhone too, and is up over 8% on the year.

AcidJoe

Here is something I came across while doing something else. It's a list of all discount brokerages, fees etc.

http://www.ndir.com/SI/brokers/discount.shtml

Might be of interest to some.

Unknown

StingyInvestor is a pretty cool site and that was a pretty good summary. The guy who runs it, Norm Rothery writes articles for MoneySense magazine often. He refers to Ben Graham a lot.

My non-RSP is with BMO Investorline and my RSP is with TD Waterhouse also. With TD Waterhouse, I think that the commissions go down to 9.99 when your portfolio reaches $500,000, or if you're active enough. Let's see how long it takes to get to half a mil.

AcidJoe wrote: »

Here is something I came across while doing something else. It's a list of all discount brokerages, fees etc.

http://www.ndir.com/SI/brokers/discount.shtml

Might be of interest to some.