Apple for retirement portfolios

Apple has a ton of cash and CEO Tim Cook has explicitly said he wants to raise the dividend each year.

Regardless of what you think about Apple prod­ucts, Apple the com­pa­ny is worth a look at for your port­fo­lio. Especially your retire­ment port­fo­lio. Apple has a lot of mon­ey in the bank (and the cur­rent tax plan favors their return­ing it to the US) and has been rais­ing it’s div­i­dend year­ly for a few years. CEO Tim […]

Curious about why stocks go down on good news (or up on bad)

Answer: Investing is not science, sometimes expectations are priced in so the news itself doesn't matter in the way you think.

I think it’s help­ful to invest in a com­pa­ny you know, pri­mar­i­ly because when you are inter­est­ed in your invest­ments you’ll learn more about them. I also believe that you’ll learn more about how the mar­ket works, because you’ll be more curi­ous. Have you ever seen a com­pa­ny release good news (or announce good earn­ings) and […]

What’s stopping you from investing?

Stockpile tweet­ed a quote from my Stockpile review the oth­er day that got me to ask myself a sim­ple ques­tion about invest­ing. I want you to ask your­self this same ques­tion, but first the tweet: “I think their low min­i­mums & the diver­si­ty of stocks are great, ppl real­ly don’t have an excuse not to invest […]

Dollar Cost Averaging: What is it good for?

Dollar cost averaging provides an advantage for lowering your investing costs over time, which are best used to reinforce a healthy wealth building habit rather than to determine when to invest a lump sum.

Even the phrase “dol­lar cost aver­ag­ing” should put most peo­ple to sleep. Yet, here it is. Dollar cost aver­ag­ing is an invest­ing “strat­e­gy” that basi­cal­ly says, if you invest the same amount reg­u­lar­ly over time, some­times you buy high and oth­er times low­er. Because you’re invest­ing the same amount of mon­ey each time, when prices are low­er […]

Why don’t people invest?

People don't invest because it usually doesn't feel good. When was the last time you participated in something you don't understand, in spite of it not feeling good?

Pause. Clear pre­con­cep­tions. Then ask the void… why don’t peo­ple invest? Let’s even nar­row the audi­ence of peo­ple. People who are edu­cat­ed, with a job, and with some mon­ey to invest. Yet still, why don’t they invest? Many com­pa­nies have a lot of mon­ey rid­ing on the answer to this ques­tion. Their answers… more tech­nol­o­gy. More access. More […]

Investing in Airlines

You may not be investing in an airplane company

I’m fas­ci­nat­ed by indi­vid­ual investors who think they can beat the mar­ket. Who think they can do research with spe­cial insight, beyond what the pro­fes­sion­als can do. How many peo­ple who invest in air­lines real­ize that most of the mon­ey they make comes from the points they sell? This is a great exam­ple of how many […]

Airline Investments

Your Investing Edge

Everyone's looking for an edge. Few are able to stomach the price. Those that do, reap the rewards.

Let’s pre­tend for a moment that the infor­ma­tion in my book is tru­ly dif­fer­en­ti­at­ing. A way to invest and win all the time. Why can’t peo­ple stick with it? Reading this arti­cle on black­jack card count­ing titled ’sur­viv­ing the con­tin­u­ous chain of dis­ap­point­ments’ helps under­stand why. The key to Thorp’s sys­tem was the abil­i­ty to sur­vive los­ing […]

Most powerful force in the universe

The Irrelevant Investor
1/18/2017

Buffett has been rich for­ev­er, but 95% of his net worth was earned after his 60th birth­day.

Read this arti­cle to under­stand the pow­er of com­pound­ing and why even long term thinkers can’t com­pre­hend how things will play out over the long arc of time.

Compounding plays an impor­tant fac­tor in the Elephant’s Paycheck Blueprint because we rein­vest div­i­dends and count on annu­al div­i­dend increas­es (which com­pound on each oth­er year-after-year). We’re com­pound­ing that div­i­dend return because we get div­i­dends from our div­i­dends, and over time, it real­ly adds up. Even after a “short time” like five years, you’ll see real­ly inter­est­ing num­bers if you look at com­pound div­i­dend growth from rein­vest­ing and annu­al div­i­dend increas­es.

It’s anec­do­tal, but after about 4 1/2 years the pay­check from the total­ly ran­dom sam­ple port­fo­lio I put togeth­er increased 75%, and has a pro­ject­ed raise of over 10% for the next year (con­ser­v­a­tive­ly). The anec­dote I like to tell… you prob­a­bly aren’t get­ting 10% a year (year after year) at your job. But your port­fo­lio can.

Part of the rea­son it’s hard to under­stand is that, as I write about it, I have to shift between absolute num­bers (a 10¢ increase) and rel­a­tive num­bers (a 10% increase) as I’m describ­ing dif­fer­ent aspects of what to expect. I don’t think peo­ple under­stand per­cent­ages very well. If I told you you had a $1 a year income from invest­ing, you’d roll your eyes. But, it’s impor­tant. If you had only invest­ed $50, that’s 20% — a fan­tas­tic income per­cent­age.

At a time when peo­ple want quick answers to things, but don’t want to stop and think about what they mean, it’s hard to get read­ers to spend the time to think about what this all means, and why it’s impor­tant. I had some­one inter­rupt me the oth­er day and say:

wow, you’re a real­ly long term thinker.

Yeah. And I hope some of that will rub off on you guys.

10% growth for 25 years is not 250%, it’s 985%!” When you show relatively new investors this kind of thing, it’s like an awakening.”
@ReformedBroker‬
1/19/17