$10,000 to in Invest. Where should I start?

[unit321]

CD interest rates are low, but would be a conservative place to put your cash until the stock market improves or you find something in the future that would be a good investment.

Mutual funds. No no.

Stocks. Oil stocks are like blue chip stocks of the 80s. Exxon. BP.

You don't quite have enough in capital but starting a storage unit business would be worth it.

 

[The Bilingual Gringo]

We have single premium life insurance policies here that are earning guaranteed 3%, I'd go into something like that and let it chill.

 

[rastafarwrite81]

We have single premium life insurance policies here that are earning guaranteed 3%, I'd go into something like that and let it chill.

inflation is running at 3.5% historically and you think it is wise to park your money in a whole life policy paying 3%.



maybe for a retiree, maybe. but not for a 30 year old

 

[The Bilingual Gringo]

inflation is running at 3.5% historically and you think it is wise to park your money in a whole life policy paying 3%.



maybe for a retiree, maybe. but not for a 30 year old

You do bring up a good point

At least it's doing something at the moment. This product is 100% liquidity w/o surrender issues so why not.

 

[rastafarwrite81]

You do bring up a good point

At least it's doing something at the moment. This product is 100% liquidity w/o surrender issues so why not.

Now correct me if i am wrong, but don't life insurance policies with cash value have limits to how much money can be placed in them before they would be considered endowments??

knowledge is a little fuzzy there

 

[The Bilingual Gringo]

Now correct me if i am wrong, but don't life insurance policies with cash value have limits to how much money can be placed in them before they would be considered endowments??

knowledge is a little fuzzy there

You're right, this particular product is instantly a Modified Endowment Contract because it's a one-time payment, even for a 30 year old.

It's mainly to go against CD's since those rates are really, really low right now.

 

[Domingo Halliburton]

this is advice that you should not follow. I meet clients like this all day who swear up and down that they get better returns investing by themselves. Then I look at the returns and laugh.

you trade etfs, ok. Let me ask you

1) how is your portfolio correlated? is it positive, negative, or non? Do you know why this is important?

2)what are the beta and sharpe ratios associated with your portfolio?

3)What types of risk is your portfolio susceptible to given your current investment strategy and how will you hedge this risk

i can go on and on

Goto a financial advisor and let them help you, do not try to do this on your own.

would you argue that having two assets negatively correlated is a good thing over the long haul? I've heard arguments both ways.

 

[Julius Skrrvin]

I need to start learning about this shyt (22y/o) can anyone give me a good source of information to start, and maybe somewhere to keep up on what's good in the market? I don't know shyt

 

[Domingo Halliburton]

I need to start learning about this shyt (22y/o) can anyone give me a good source of information to start, and maybe somewhere to keep up on what's good in the market? I don't know shyt

Yahoo! Finance - Business Finance, Stock Market, Quotes, News

investopedia.com has helped me too if it's some obscure finance term I haven't heard. But there's plenty of other sites.

 

[OsO]

gold, silver... either ETFs or an actual mine or actual physical gold and silver, or a combination of all three.

and invest some in a small business of your own.

 

[rastafarwrite81]

would you argue that having two assets negatively correlated is a good thing over the long haul? I've heard arguments both ways.

what do you do with sharpe ratios if your client doesn't want to short, just put it somewhere on the eff?

thats a very good question. You wanna get all technical analysis on me.

that all depends on the assets your chooisng that are negatively correlated. For example, consumer staples such as cigarettes and alcohol are recession proof,they tend not to react to volatility. lets assume that these staples have a negative correlation with financials. Now by having those consumer staples in your portfolio they will help keep the portfolio "afloat" in downswings, but they will also rise with upswings. So to be honest it all depends upon what assets your choosing that are negatively correlated when looking at long term portfolio management.

Now regarding the efficient frontier question, you want the standard deviation to be as low as possible in regards to the return on the portfolio. As long as the portfolio resides on the efficient frontier then it is still is an optimal strategy. You just have to convince the client to assume the higher risk ( standard deviation) which tends to generate a higher expected return.

the sharpe ratio basically tells you how much risk was assumed to generate excess return in the portfolio. so if the client has a good return but is assuming too much risk, that is not efficient.

you tend to want a low standard deviation and high shapre ratio

 

[Domingo Halliburton]

thats a very good question. You wanna get all technical analysis on me.

that all depends on the assets your chooisng that are negatively correlated. For example, consumer staples such as cigarettes and alcohol are recession proof,they tend not to react to volatility. lets assume that these staples have a negative correlation with financials. Now by having those consumer staples in your portfolio they will help keep the portfolio "afloat" in downswings, but they will also rise with upswings. So to be honest it all depends upon what assets your choosing that are negatively correlated when looking at long term portfolio management.

Now regarding the efficient frontier question, you want the standard deviation to be as low as possible in regards to the return on the portfolio. As long as the portfolio resides on the efficient frontier then it is still is an optimal strategy. You just have to convince the client to assume the higher risk ( standard deviation) which tends to generate a higher expected return.

the sharpe ratio basically tells you how much risk was assumed to generate excess return in the portfolio. so if the client has a good return but is assuming too much risk, that is not efficient.

you tend to want a low standard deviation and high shapre ratio

I was mixing up sharpe ratio with optimal portfolio. It's been a few years since I've studied this stuff in college.

Do you think markets are too efficient to beat? Do you follow the "random walk" guys like malkiel and fama? or do you think you can beat the market consistently?

 

[rastafarwrite81]

I was mixing up sharpe ratio with optimal portfolio. It's been a few years since I've studied this stuff in college.

Do you think markets are too efficient to beat? Do you follow the "random walk" guys like malkiel and fama? or do you think you can beat the market consistently?

it's based on what theory you subscribe to. To be honest, the only way to beat the market is to have information that the market doesn't have access to, which is having insider information. I subscribe to the theory that any information that will effect the market is already known by the market.


The idea is not to "beat the market" because in a sense what your doing is chasing returns. This means your assuming more risk than required. This leads to your portfolio becoming .

The best way to invest is to buy and hold, then rebalance when necessary.

 

[SuburbanPimp]

I appreciate all ya'll for the input....

Its alot of good information in this thread and thats why I like bringing some stuff to the Coli because I know it will be some good dialouge and debate.

I have a few people in my network who I'm going to speak to along with 2 Financial Advisors who are going provide Free Consultations in the next couple of weeks. But I'm still going to do ALOT of research and homework on my own. Like I said before I'm in no rush to make any moves so I just want to gather as much information as possible before I start making moves.

 

[Domingo Halliburton]

it's based on what theory you subscribe to. To be honest, the only way to beat the market is to have information that the market doesn't have access to, which is having insider information. I subscribe to the theory that any information that will effect the market is already known by the market.


The idea is not to "beat the market" because in a sense what your doing is chasing returns. This means your assuming more risk than required. This leads to your portfolio becoming .

The best way to invest is to buy and hold, then rebalance when necessary.

if you don't mind me asking could you tell me how you got into being an adviser? I've worked in banking but never to the point where I had clients