Just wondering how many people banter around or seriously invest for themselves…and how successful they’ve been with their portfolio’s thus far? Myself, I’m just about to get started and have a few things that I’m looking at. I’m primarily looking to save up to put a downpayment on a condo within a year or so and thought it would be a good idea to dabble with stocks/bonds (in a value investing sense).
> I’m primarily > looking to save up to put a downpayment on a condo > within a year or so and thought it would be a good > idea to dabble with stocks/bonds (in a value > investing sense). this makes no sense. if you are looking to make a downpayment in a year that money should not be at risk in the interim. try hsbc online savings.
Danteshek Wrote: ------------------------------------------------------- > > I’m primarily > > looking to save up to put a downpayment on a > condo > > within a year or so and thought it would be a > good > > idea to dabble with stocks/bonds (in a value > > investing sense). > > this makes no sense. if you are looking to make a > downpayment in a year that money should not be at > risk in the interim. try hsbc online savings. I meant from a value investing standpoint…as in, buying something like a bank stock when it’s at an extremely low price, when the chances of it going lower are fairly low. Sure there’s a little bit of risk, but it’s something I’m willing to stomach. I’ve thought about just tossing it over into a money market or just a savings account…due to the 0 risk involved, but I figured I’m able to handle a little bit of risk I should go with something that has a little more potential for growth. Even if it is only for a year. It’s also possible I may change my mind about how much I want to save, and increase my timeline for saving the downpayment.
Listen to Danteshek. If you don’t agree with him, then study investing basics until you do.
DarienHacker Wrote: ------------------------------------------------------- > Listen to Danteshek. If you don’t agree with him, > then study investing basics until you do. I’m not disagreeing with him, read again. “dabble” was a poor choice of wording on my part.
i would say that banks look good right now from fundamentals viewpoint and you are right that investing in financials will give good results , but the question is will this materialize in the next year? this is the risk D is talking about i think, and since you cant just invest and see (since you need the money in 1 yr) then dont risk it.
If you think you can put a value on certain bank stocks right now then you are truly a genius. Lastly, buying falling knives like banks is NOT value investing at all in any form.
I can’t even value chicken wings and beer. hence i am getting my a** handed to me on BWLD lately.
Well I expect them to go down a little bit more (some more than others, obviously) over the next several months and would present a decent buy situation, but I can’t see them falling ‘considerably’ more than that before they start moving back up. I’m talking about canadian banks, btw.
bns and td are my picks, this is what i meant by banks . i am not sure about any others
I think you are underestimating the risk level of your potential investment. At the very least, I would only invest as much money as you typically save in the course of a year. That way, your condo purchase is secure for next year, no matter how your portfolio performs
The problem is investing based on fundamentals only works if you have a long-term investment horizon. By any definition, a long-term horizon is longer than 1 year. I don’t think anybody will disagree with you widely that banks are cheap now and offer compelling value, but if you are buying now in expectation that the trend will reverse in 1 year, that is not value investing. You are trying to time the market. There is nothing wrong in trying to time the market, but are you confident enough in you market timing skill that you are willing to bet the downpayment of your condo on it?
SomewhatDamaged Wrote: >when the chances of it going lower are fairly low. Never ever, EVER, think like this. I don’t care how far a stock has fallen; there’s never any reason to believe it can’t keep plummeting. In fact I would say the odds are quite good that we haven’t seen the bottom yet. It’s also foolish to be playing around with equities right now with a 1 year time horizon on important money.
I can’t disagree with anything you guys have said and appreciate the constructive feedback. I guess I want to get some sort of exposure to the markets for myself instead of what I do at work. Whatever I will be putting in won’t be a large enough sum to make me lose sleep at night, but I guess it could ruffle some feathers. I’m willing to stomach a bit of a loss as I do understand the risks involved. At the same time, it’s not like I’m going to be investing in penny stocks. All that being said, I’ll probably chicken out and just hold everything in the cash account.
Since you need this money in about a year, I don’t think you should even look at individual stocks. Get a set of ETFs you’re confortable with, try to find some that form a set as uncorrelated as possible (International, Sector specific, bonds, …) and design your optimized portfolio or just spread your capital equal weight between them and adjust every 3 month.
does anyone think china will finally change to a free float this year?
This is a great question, because a good (CFA) analyst does not equal a good investor/speculator. It takes something more that can’t be learned through standardized exams. Like a previous poster said, if you are saving for a down payment, don’t use that money to “learn” investing. Paper-trade and read the investment classics before you put any skin in the game. Trust me, there is a tuition to be paid, and you don’t want to use your important $ to pay that tuition.
SomewhatDamaged Wrote: ------------------------------------------------------- > I can’t disagree with anything you guys have said > and appreciate the constructive feedback. > > I guess I want to get some sort of exposure to the > markets for myself instead of what I do at work. > Whatever I will be putting in won’t be a large > enough sum to make me lose sleep at night, but I > guess it could ruffle some feathers. > > I’m willing to stomach a bit of a loss as I do > understand the risks involved. > > At the same time, it’s not like I’m going to be > investing in penny stocks. > > All that being said, I’ll probably chicken out and > just hold everything in the cash account. All these guys are brainwashed. I like your idea, but if you gear up too, you’ll be able to magnify your gains… No, but on a serious note, if you are flexible with the timing, there is no harm in having 20-30% in equities. You don’t have to run your personal portfolio in accordance with CFAI dictum. Thank God! I work as a buyside equity analyst at a very analytical value house with a 5yr+ horizon. In my personal account, I buy/sell on a whim, sometimes with a very short horizon, often owning just 2 or 3 stocks and occasionally all in the same sector. When it’s your own money, there is room for FUN in investing.
I’d have thought that a bank stock is probably highly correlated with the price of that condo. Could be a decent hedge…