Investing Lessons Learned

There is an investing adage: “You either learn a lesson or make a profit; never both”. I have found this to be true for a better part of my investing years, but as I gain more experience, I am trying to reflect and learn lessons from all my trades – from both winners and losers.

This bull market in stocks has been ongoing for a decade and most investors have forgotten what it is like to lose money and come to witness heart-stopping moments when you suddenly see your envisioned future disappear. I first started  investing in individual stocks in 2008, just before the Global Financial Crisis and that was a great teacher. I try to remember the lessons I learned back then and continue to learn new ones everyday. Over the last couple of years, I decided to move a big portion of my portfolio into the precious metals and mining sector as I saw more value and the sector was hated by many. My reasoning is fairly simple: when the markets crash (and they will), most investors will seek safe havens, and there is no better safe haven than gold. There are a few other reasons, but that is the big one.

Over the last few quarters, I have been finding so many interesting prospects for investing in the sector, that I have overshot my initial target. The sector now makes 1/2 of my overall investing portfolio. Even with a few sales over the last few months, I have been hovering close to the 50% mark due to good returns. And the bull market in gold/silver mining stocks is just getting started!

While I look over the overall portfolio composition, I am being reminded of a lot of investing lessons from each trade. So, I decided that I will share some of these thoughts (including some random observations) here. Hopefully you will find the thoughts valuable & interesting.

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5 ways to build a million-dollar retirement fund

The following is a guest post

You are never too young to think about retirement investments. The reasoning behind this lies in the power of compound interest. As an example, this article explains how putting off retirement savings by just 10 years can cost you over half-million dollars until 65.

There are countless ways to build your retirement portfolio, depending on your income, lifestyle, the appetite for risk and resilience in saving money. Our top recommendations include:

  • opening an IRA next to your 401(k),
  • contact a broker and invest in stock market,
  • don’t ignore the cryptocurrency market,
  • automate savings,
  • don’t forget about catch-up contributions if you are over 50.

The importance of the IRA

Even if your employer generously offers a 401(k) which, by all means, you should take and match the contribution, consider also getting an IRA. Choose between the two available flavors. The first option is the traditional, tax-deductible IRA, which also grows tax-deferred until withdrawal. The Roth IRA consists of after-tax money and yields tax-free withdrawals on maturity. There is a third kind, non-deductible IRA for high-earners.

The best option of the three could be the Roth IRA since the money grows tax-free. By the power of the compound interest, by the time you take them out the fund could have multiplied a couple of times.

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Is Tesla Stock a Good Investment?

The following is a 3rd party contribution 

Tesla’s stock price recovered much of its recent losses triggered by the recent global market sell-off, and the company is currently trading around USD 330. This is slightly below the level it reached on January 25th, after which it rose to USD 354, fell as low as USD 310 and then rebounded to USD 357. However, it is currently moving back down and could soon approach the previous support level of USD 309.54.

Whether TSLA continues to fall or stages another rally, traders can take advantage of all price movements by using stock trading platforms. Many brokers, such as UFX.com, offer numerous trading tools and advanced charts, allowing members to make more informed trading decisions. The question for many is now whether Tesla stock represents a sound investment.

The valuation of the company still seems too high for many analysts, since the company is yet to make a profit and is burning a lot of cash, not to mention its production problem regarding the new Model 3. According to Barclays, the electric vehicle producer’s stock should be sold, while Morgan Stanley reiterated its “equal weight” rating at the beginning of February with a price target of USD 379. Even if its stock rises, Tesla has serious challenges to address, ones that are likely to weigh heavily on the company’s valuation.

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Recent Buy – FNV

BuySell

A quick update about a purchase in my portfolio last week. As I’ve outlined in the monthly Outlook posts, there are a few opportunities that are still undervalued. While it may come as no surprise, regular readers will observe that I am still very bullish and overweight in commodities and precious metals. While this is a sector that I have been thinking of trimming possibly since it has grown to an outsized position, I cant help but add some shares in high quality companies when I get the opportunity.

Last week, after a slight miss in earnings, I managed to pick up a 50 shares in Franco Nevada Corp (FNV.TO) at C$87.00. The company pays an annual dividend of US$0.92, which adds US$46  to my annual income stream (a div increase is expected next quarter).

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Top Dividend Raises & Cuts for February 2018

Dividend growth investing is a popular model followed by the investing community to build assets. Companies which not only pay dividends, but raise them year after year have been shown to perform better overall for investor returns. On the flip side, it is also important to keep an eye on the dividend cuts, which could signal troubling times ahead for a company. This post captures the announcements of changes in dividend amount for the week – both increases and cuts.

Note that only $2B+ (Midcap+) companies are included in this list.

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