Finally! After taking a long hiatus from the financial investments due to some interesting experiences in investment real estate, I am slowly getting back into the market. While I was waiting for my last home to sell, I opened up an account with Scottrade. This Tuesday I transferred the first small chunk ($2000) which showed up in the account today. Suffice it to say I wasted no time and quickly invested all of it and requested the transfer of another $4000 into the account :) Here are my first couple investments just to get my feet wet:
1) 1 contract for and August IBM Call option with a $105 strike price. Cost - $283 ($275 for the contract and about $8 for the trade). Current price of IBM is $105.40
This is something I've been wanted to do for quite some time. I've been reading a book on options trading and how to better leverage your capital. I'm not going to try spreads and puts and all this craziness until I better understand what the heck it all means. So this is kind of an experiment. I'm pretty confident in IBM, so buying barely in-the-money gives me a higher probability of actually exercising the option and very high leverage. Not to mention it was under $300.
2) 14 shares of Petroleo Brasileiro S.A. (PBR) - Current price - $121. Cost - about $1700
This stock was listed by Fortune Magazine as one their "Fortune 40" portfolio stocks. PBR falls into their Foreign Value category. It is up almost 100% in the past year with no major hints of declining. It has a low P/E of 11 and a future P/E of 9, suggesting around 20% EPS growth. Not to mention it simultaneously allows me to invest in oil and international. I like both.
As I mentioned, these were just to get my feet wet. As the money comes in from real estate closings, I'll be investing in various other stocks, funds and options. I will probably largely mimick my 401k fund choices.
I will post every time I make a change in my investments.
Friday, June 22, 2007
Wednesday, June 20, 2007
401k Plan Adjustments
This week I spent a considerable amount of time analyzing my 401k plan. I hadn't made any changes in 2007 and it was time to review. This was previous and somewhat generic 401k set up - none of the funds are publicly traded...
20% - Large-Cap Value Index
15% - REIT Index
25% - Small-Cap Growth Index
40% - Total Int'l Stock Market Index
YTD Return - 7.9% (almost 6 months)
I realize this is a very simple set up, but that was the idea. I wanted to take on a fair amount of risk because my balance is not that high (around $15k) and being 27 years old, am far from retiring!
Several of my coworkers and I regularly compare YTD returns to see who is in the lead. It also keeps us on our toes to take full advantage of the market. I usually am either in the lead or close to it, but this year one of my old teammates is kicking my butt with around 13% YTD returns. I knew he had enrolled in the "*Mutual Fund Window" a while back, giving him access to almost 200 top-quality, publicly traded funds. We had done about the same until this year, though and I am a sore loser for sure, which resulted in my enrollment into the "*Mutual Fund Window" and redistribution of investments.
*This is part of my company's 401k plan which is managed by Fidelity.
So, as of 6/20/07, this is my new investment mix, with group %s based off the original model (yes, I am a big fan of international investments like most people):
10% - Fidelity Export & Multinational Fund - Large-Cap Blend
15% - Dodge & Cox Stock - Large Value
20% - Fidelity Leveraged Company Stock - Mid-Cap Blend
15% - American Funds Small Cap World - Small-Cap Growth
10% - Fidelity Intl. Real Estate - Specialty RE
8% - Vangaurd Intl. Explorer
7% - Vangaurd Global Equity
8% - Fidelity Latin America
7% - Dodge & Cox Intl. Stock - Foreign Blend
These are slightly different proportions than my original mix:
25% - Large-Cap
20% - Mid-Cap
15% - Small-Cap
40% - Intl. (unless you include that 50% of the AF Small Cap World is intl, in which case I am 47% intl.)
I am noting that I am 7.9% YTD as the starting point on 6/20/2007. We'll see how it goes!
20% - Large-Cap Value Index
15% - REIT Index
25% - Small-Cap Growth Index
40% - Total Int'l Stock Market Index
YTD Return - 7.9% (almost 6 months)
I realize this is a very simple set up, but that was the idea. I wanted to take on a fair amount of risk because my balance is not that high (around $15k) and being 27 years old, am far from retiring!
Several of my coworkers and I regularly compare YTD returns to see who is in the lead. It also keeps us on our toes to take full advantage of the market. I usually am either in the lead or close to it, but this year one of my old teammates is kicking my butt with around 13% YTD returns. I knew he had enrolled in the "*Mutual Fund Window" a while back, giving him access to almost 200 top-quality, publicly traded funds. We had done about the same until this year, though and I am a sore loser for sure, which resulted in my enrollment into the "*Mutual Fund Window" and redistribution of investments.
*This is part of my company's 401k plan which is managed by Fidelity.
So, as of 6/20/07, this is my new investment mix, with group %s based off the original model (yes, I am a big fan of international investments like most people):
10% - Fidelity Export & Multinational Fund - Large-Cap Blend
15% - Dodge & Cox Stock - Large Value
20% - Fidelity Leveraged Company Stock - Mid-Cap Blend
15% - American Funds Small Cap World - Small-Cap Growth
10% - Fidelity Intl. Real Estate - Specialty RE
8% - Vangaurd Intl. Explorer
7% - Vangaurd Global Equity
8% - Fidelity Latin America
7% - Dodge & Cox Intl. Stock - Foreign Blend
These are slightly different proportions than my original mix:
25% - Large-Cap
20% - Mid-Cap
15% - Small-Cap
40% - Intl. (unless you include that 50% of the AF Small Cap World is intl, in which case I am 47% intl.)
I am noting that I am 7.9% YTD as the starting point on 6/20/2007. We'll see how it goes!
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