Investing for fun and profit  

redmustang91 58M  
8976 posts
4/26/2006 9:58 am
Investing for fun and profit

The joys of investing can be fun and profitable. You feel great when you make money and sad when your investments drop. But you need a long term perspective to suceed over time. I have been investing since 1982 and have learned to roll with the punches. Some observations:

Most people are better off with no load mutual funds. I dislike bonds, annuities, insurance, load funds, high expense fee funds, general equities in the US, Europe, and Japan. I don't use brokers as they cannot predict the future any better than I can and cost more!

I seek momentum and hot sectors that make sense at reasonable price to earnings and to growth ratios. I invest only in retirement accounts, Keogh and IRA as I don't like to pay income taxes until I take a distribution. Tax deferred compounding for decades!

One should look at the entire portfolio and get wide diversification. No one stock should be more than 3% of your total investment funds.

My current portfolio allocation, with mutual fund examples:

35% emerging markets: DREGX, OBCHX, FXI, PEPMX, EUROX, PRLAX, FLATX

18% Gold, silver, platinum: USERX, UNWPX

18% Other base metals, steel, copper, titanium, nickel, zinc, uranium: ICBMX

18% Energy, oil and alternative energy: PSPFX, PBW

11% Misc. railroads, stockbrokers, industrials.

Jim Kramer is fun to watch, but he touts too many stocks and pushes too many high risk stocks. Google is going up and great now but at a price to earning ratio of 85 it is too risky for me. Ebay and Yahoo once were high flyers and they have sunk back to earth. I avoid tech as too expensive for the growth and does not earn enough to justify the prices.

I love Latin America, China, Russia and Eastern Europe despite the political risk. In a fund spread over many countries you can still make money when things go wrong in one company or country.

My portfolio has more than doubled in 18 months, while the general US market has increased very little. Once you set the portfolio up you can look at it every four months and fine tune or just let it run. Big trends last years, like energy, metals, and emerging markets.

Lets cheer for a rich retirement, traveling and having fab sex!

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