All I'm asking is 6%. Not 15%, not 12%. Just give me 6%

[davidil]

Software and now Application design. Took a few years...

 

[CarrieW]

dude Im a chick not a dude.

since mj knows what it is he can probably answer me in 1 sentence. what exchange they trade on and what it basically is. then I can look up more information on the exchange.

If I google it I will likely have to sift n sort thru alot of stuff to figure it out.

thanks for your imput tho.

 

[diesel]

I need to put away a certain amount this year to help out with my taxes and I really hate to put money in the stock market.

Any recommended books?

 

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[diesel]

Anyone can have that perception and make it look true to themselves. You are wasting your time thinking like that. You're mind is basically in a self fulfilling circle of thoughts.

You're better than that!

Shift your thoughts bro.

People find great investments all the time. There is no reason why we can't either.

 

[garyfritz]

I know the feeling. I've had many friends beg me to start a service publishing my stock picks, so they could short them. Sell when I buy, buy when I sell. My stock-picking skilz suck, epically.

That's why I do automated short-term trading systems. I'm good at that.

 

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[valuegiver]

If you hold gold, you will get much better than 15% per annum.

 

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[andviv]

WOW, this is a very good thread.

MJ, Rep++ for your response. I love the fact that you openly described your strategy and yet people want to battle with the result. Beats me.

I think the best advice here is the one about sticking to what you know. MJ knows about those vehicles he mentioned so he is doing that and I am sure he is not guessing, he has dedicated time to learn it.

I am sincerely amazed by the mentality of the original poster.

Dude, you can make a few millions in a particular industry but are asking about where to invest the money? You have done something amazing, something that most people can only dream about, and yet have this defeated why of thinking. I just don't get it.

So, if you know software, why not investing your money in companies in that business? you must know people in that industry. Open your ears, start talking to people, and invest on those companies that you think are worth your time and money. No, I am not necessarily talking about the Apples of the world... I am talking about small companies that need to grow, have a good product/service and need cash to keep growing. Buy a controlling share and let the owner run the business while you can keep a close eye on what's going on with the business.

You mention RE... what do you know about this? These days, and in some locations, you could buy a 20-unit apartment building, with professional management, that could give you a better return than what you are talking about. Me? That is what I'd do if in your similar situation, but that is because I have some experience and knowledge about the rental markets and apartment buildings.

 

[hrishikesh]

Why not invest in India?
I deposit money in government banks as fixed deposit and earn around 10% per annum returns guaranteed (before tax)
Since it is government bank I assume they are safe and backed by government (not sure though)
EDIT: Here are the rates if you don't believe me STATE BANK OF INDIA :: INDIA's LARGEST BANK

 

[Bozigian]

We need more threads like these

 

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[CommonCents]

A good area to look is receivables. Credit is non existent for small/med business that are in decent shape but are getting stretched in receivables by their larger solid credit customers. The going rates are 1-4% a month, with 2-3% most common. I'd say this market condition will remain for years. You might even talk to a factoring company as an investor and see what rates they might pay. I'm getting closer to starting a fund to invest in this and close to a hedge fund seed of $5-10mil.

 

[garyfritz]

2-3%/mo? Is it generally secured by anything?

How does your average person connect up with this? Call around to all the local businesses and see if they want to borrow money at 30%+ per year??

 

[Steven Williams]

If you're looking for a 6% return you'll have to find something like real estate or a small biz to invest in. In 09 and '10 I averaged 50% to 75% returns on my real estate investments. Decided to not invest in properties this year but I focused more on my businesses and invested in small businesses that provide me a small monthly return.

But remember there's really no safe investment...all investing is risky! The more control you have over operations the less risk.

 

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[GlobalWealth]

I will reiterate what I said before, you need to decide what you want to do.

If you enjoy investing and trading, educate yourself. Take classes, read books, find a mentor, etc. But only if this something that interests you.

Time is our most precious asset. How you invest your time is much more important than how you invest your money.

If you don't enjoy investing, then you should find someone else to manage your money. The days are long gone where you just buy and hold and things will work out great.

To get decent returns now, it takes an actively managed portfolio. If you don't enjoy this, hire someone who does and invest your time in other endeavors.

 

[davidil]

let just average it all out and say that you've moved in and out of these funds all year with your $200k and when its all said and done you average a 5 percent yield for the year. Not bad, right ? That is $10k profit on your 200k for the year

Honestly? All that work for $10k a year? Doesn't worth it for me man. I make that money with my business in a few days, with less work, why would I spend weeks learning this stuff and then sitting in front of the computer a few hours a week, and not sleep well knowing that I may wake up tomorrow and discover that some disaster happened like 9/11 or who knows and suddenly I lost $100k ?

We are here looking for passive income so we can enjoy our youth traveling, reading and writing screenplays, right? Managing large RE complexes, day trading... I don't want to sound spoiled but it's not what I'm looking for. It's slowlane mentality... it's what the masses do. We're here looking for the "next level" aren't we?

 

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[davidil]

#5 is HUGE.......this is where MJ's fastlane approach makes a difference, a BIG difference. IMO unless you have millions ( by that I mean at least 1 to 2 mil ) to invest in the higher yield funds mentioned above, its not worth it when your working with 200k. At 5 percent with 200k your making $10k a year or $833 a month. Again this is just examples to keep things simple but.................... With 2 mil invested at 5 percent your making 100k a year or $8,333 a month !!!! Big difference if you trying to live off the interest.

OK yes, but then you can also lose $100k a month...

I was sitting with Goldman Sachs a couple of years ago, they told me about a capital protected 5% fund (I think... maybe it was 6%) in which you lose your money (in correlation to the market) only if the market crashes by more than 60% or so. So it's not really capital protected but freaking close. That's the kind of thing I'm looking for. And I think you had to sign up for it for 5 years or so.

So far this year I'm up over 5 percent on what I've been using as my "trading money" and this is after the markets took a crap the past month. Prior to that I was up close to 10 percent overall for the year.

How many hours a week do you put into this?

 

[CarrieW]

just because your one buddies business isnt worth investing in doesnt mean EVERY business isnt worth investing in.

you have the knowledge to see thru the crap they are selling cause you know the industry. this will help you. put out feelers and try to find a company in better shape then your friends.

the trick is seeing the bullshit and not believeing it. sounds like your already there, now you just have to put your experience to work for you and try to find something/someone worth while!

 

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[JEdwards]

2-3%/mo? Is it generally secured by anything?

How does your average person connect up with this? Call around to all the local businesses and see if they want to borrow money at 30%+ per year??

I believe what he is talking about is factoring.. So yes it is secured by the invoice the company has.. For example: Say The company does a paint job at an office building that pays in 30 days, but they need to make payroll today. You loan them the money for the invoice minus your fee (10% a month+-) and you collect the invoice.

You might need a regulated loan license in your state.

Also a good idea is to finance a note lot.. Lot of money to be made financing cars at 28% a year.

 

[Mr.Marnier]

Well, in that case it really does sound like real estate is a good investment where you can expect 4.5% easily, if not more. Especially if you can get a low interest mortgage, leverage your cash to buy a few properties or a very large one, buy them when the market is down (as it is now).... wouldn't you agree?



Dude, google ETF.

Exchange-traded fund - Wikipedia, the free encyclopedia

I don't know what FAX is and can't google it because it gives too many Fax related results....



OK mate, I'll do that. Any recommendations on which ones to read?

Cheers

That made me want to go google digging.... tons of fax machine results indeed but I think this could be the "FAX" mentioned, Aberdeen Asia-Pacific Income Fund, Inc... Aberdeen Asia-Pacific Income Fund, Inc.: NYSE:FAX quotes & news - Google Finance , not sure however.

 

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[CarrieW]

lol that was why I asked mj instead of googling! google is my best friend but sometimes its just simpler to ask someone who knows!

 

[CommonCents]

I believe what he is talking about is factoring.. So yes it is secured by the invoice the company has.. For example: Say The company does a paint job at an office building that pays in 30 days, but they need to make payroll today. You loan them the money for the invoice minus your fee (10% a month+-) and you collect the invoice.

You might need a regulated loan license in your state.

Also a good idea is to finance a note lot.. Lot of money to be made financing cars at 28% a year.

Exactly, you can buy selected invoices from suppliers of solid companies such as a Target. They'll pay. The risk is if you take on invoices from companies who are selling other smaller companies(risk of customer not paying invoice/going out of business). You can buy invoices from smaller companies because they aren't the credit risk, their customers are. Yes, check with your state on any regulation. There is tons of this going on since the banking system is locked up. Companies are paying higher and higher rates for operating capital and more and more will be factoring which is already the mode of biz in Europe and Latin America and this will be a larger and larger component to US biz finance. Long gone are the days of low interest lines of credit from your local bank.

You advance the supplier less than what your cut will be when you buy the invoice, when the customer pays you the full amount of the invoice to your lock box, you advance the balance less your cut to the supplier. I deal with some that are family so don't have a lock box with them, but you must control the invoice payment with a lockbox with any other company.

If you don't want to deal with details, call a few factoring companies and ask if they have investor programs. They might offer 1% a month for additional capital for hands off investors.

 

[karoooszka]

Learn to use a stock/mutual fund screener. You'll be able to pick out what rate (yield) you're looking for and then determine what risk level you're ok with based on the type of stock/mutual fund and any other criteria that is important to you.

This is not that difficult.

 

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[DeletedUser2]

OK, I'll tell you what's my problem.

I honestly believe I'm cursed. It's not me, it's my whole family.

If you want to make tons of money all you need to do is short what my father does. You will make 5% a month, guaranteed.

About a year ago I found a paper at my bank (UBS) which made 1% a month for about two years straight. I told my banker - "now look - I'm going in, you will see how this paper will start losing money". I went in with $30k, went out 6 months later it was worth $24k. Up until the very day I bought into it, it only made money. As soon as I bought it, it started losing.


If I'll put my hard earned money into ANYTHING which is not capital protected, I WILL LOSE. I honestly believe that.

I remember driving on Sunset in Los Angeles, there is big Apple billboard there for years already. I saw the ad for iPod and told myself "I should have bought Apple shares when I had a chance... idiot.... now it's too late!"

That was 2005....

dot dot dot
dot dot
dot

That sounds like a basis for a fund!

the Anti Investing Fund.
we will pile money up, and give it to fund managers,
when I make a investment, they make a counter investment.... short what I buy.
I'm telling you. that would make a good fund!

 

[davidil]

Maybe someone can recommend an investment house / bank with good reputation and track record?

Any investment seminars worth taking or are the books good enough?

 

[elgreco]

I don't know what FAX is and can't google it because it gives too many Fax related results....

You have to look for it using the right contextual keywords. Search for "australian bonds via FAX" and you'll find pages that talk about the "Aberdeen Asia-Pacific Income Fund" or AMEX:FAX or NYSE:FAX .

Cheers.

 

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[garyfritz]

Great post, A-meister. I'm not sure if silver is going quite as high as you say, but if the dollar keeps tanking (a pretty safe bet) then silver is bound to go higher.

Your covered call suggestion is a good one. Buy a stock you would like to own anyway -- maybe SLV if you want to play silver -- and sell a call at a slightly higher price. If the stock goes up to that price, the buyer of the call can "call" your stock and buy it at the strike price. So if the stock goes down, you got the call premium, and you wanted to own the stock anyway. If the stock stays flat, you still have the call premium. For both of those you'd just sell another call when the first one expires. If the stock goes up, your upside is limited, but you get the premium AND the gain between your buy price and the option strike price, and you get it in a pretty short time. So that can be a good income generator.

Selling naked puts is another. This is totally safe if you just keep money in your account to cover the put. Choose a stock you'd like to own, then sell a put at a slightly lower price. If the stock stays flat or goes up, you keep the premium. If it goes down to your strike price, you keep the premium and you buy the stock at a lower price. The danger is if the stock goes down a LOT -- but if you chose a good stock you want to own anyway, that's not a major risk.

I still recommend some of the REIT-oriented stocks like NLY, CIM, and HTS. They borrow money at low rates, and purchase govt-guaranteed mortgages. They're all well-run companies, paying around 15%! Buy some of those and maybe sell some calls on them, and you can create great income.

For example: NLY just jumped 1.28% yesterday, to $18.16. You could sell an Oct 18 put for $0.71. That says you get $71 for every option, which says you'll buy 100 shares at $18. Now if NLY drops below $18 your put will ge exercised, and you'll have to buy NLY at $18. But you really bought it at $17.29 because of the $0.71 you got for your put! So you bought it cheaper. Now you're holding NLY and collecting its dividend, which is currently paying 14.32%. (It'll be a higher percentage for you, given your lower purchase price.) Now you can start selling calls on it. At the current $18.16 price you can sell an Oct 19 call for $1.52. (Wow, that's a great premium!) So if the stock stays flat, you'll make $1.52 income in the next month, plus about 1.2% in dividend income. If it goes up and your put gets exercised, you make $19.00 / $17.29 = 9.9% -- in a month! If the stock goes down... buy more and do it again!!

Damn, I should be doing this myself... :lol: That example looks a lot more attractive than most of the examples I've looked at. But you get the idea.

 

[garyfritz]

Oh, crud. I knew that looked too good. Unfortunately I have an issue that prevents me from editing my post so I'll just have to correct it here.

I read the option tables wrong. Selling the $18 put will get you $0.71, like I said. But selling the $19 call is only worth $0.04 -- useless. You could sell a $18 call, after you buy it at $18 from your naked put. To get any significant return out of selling the calls, it looks like you have to sell them "in the money." E.g. right now NLY is at $18.16. You can sell an 18 call for $0.31. You've effectively guaranteed yourself a selling price of $18.31. So if it gets exercised, you make $18.31 / $17.29 = 5.9% in a month. Still pretty good!

You'll likely get exercised pretty often if you sell in-the-money calls like that, so you'll have to plan to churn in & out of the stock fairly often. But if that gets you the return you want...

 

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[andviv]

Very good reply.

Real Estate offers a great opportunity right now. It is in the toilet and everybody is afraid of depreciating home values. Nobody is buying despite the firesale prices. This is an incredible opportunity for an investor. I can find buildings that cash flow all day long. There has never been an opportunity quite like this in our lifetimes. In fact i think this opportunity surpasses the Great Depression. I found a 3 unit building for $20,000. It needed about $30,000 of work to get it rentable. That is not just good, that's a steal. $1,800 a month in rental income and the expenses didn't even come to $500. That is sick. As you look at the bigger units it becomes even easier to find opportunities like this.

Questions for you:

1. Where are you finding these deals (city, county)

2. Are you managing the properties yourself, or have a professional company taking care of them?

 

[davidil]

Great stuff. I'm going to dedicate the next two weeks to read books about investments. Can you please recommend some ??? That would be a great help. Just the top 1-2 books that you think is a MUST when it comes to learning how to invest your hard earned money...

THANK YOU!

 

[arpeggiomeister]

I like the naked put suggestion, and in the case of this poster it would be well with in reach. I believe you must be an accredited investor to play that game and I am not. I have learned a lot about money, from real estate to the stock market, etc. but I am am still working my way up.

I know that Scottrade will not even allow you to sell puts at all. That is the broker I currently use.

What I like about your suggestion is that it has less than 33 % of losing money. Those are good odds to start with right out of the gates. If you like the company enough, and do your research, you can reduce the odds even more. Sounds like an excellent source of cash flow.

I am expecting a major crisis in the US dollar in the near future which scares me away from the market in general. If I was smart enough to narraow the timing down to within 6 months than I would load up on put options. Unfortunately, I have learned that I know just enough to be dangerous. When silver started it's ride up to $50 a share I bought call options. I thought the big move was here. When it hit $48 I repositioned my holdings so that I was controlling over $500,000 of SLV. Than it tanked. It was then that I learned about the manipulation of the silver and gold markets by the banksters. They have naked shorted more silver in a single month than the entire amount of physical silver projected to be mined this year!!! This is totally artificial, and when it finally comes unhinged the move is going to be huge. The fundamentals support my theory, and the buying pressure is off the charts. It is the naked shorts that is holding it down, and they can not keep that game up forever... ...I digress

My main point to this response is that if you are set up so your broker will allow naked puts that would be an superb source of cash flow. This option is not available to those of us with lesser means though.

Excuse the typo. I meant to write less then 33% chance of failure.

 

[arpeggiomeister]

Excuse the typo. I meant to write less then 33% chance of failure.

Okay, apparently it was not a typo, there is some glitch that will not allow me to type percentages. Correction 2
It should say 33 percent, not 33&#37. Not sure what is up with that.