What I Am Buying Today.

[fenders53]

(11-10-2021, 03:01 PM)ken-do-nim Wrote:

(11-10-2021, 01:01 PM)fenders53 Wrote:

(11-10-2021, 11:56 AM)ken-do-nim Wrote:

(11-10-2021, 11:05 AM)fenders53 Wrote:

(11-10-2021, 10:36 AM)ken-do-nim Wrote: The rules that I have in place in the taxable are what have made it successful:
1. Minimum yield of 2.5% at all times.
2. No short term tax gain impact (anymore)
3. Current individual stock maximum of $10k, only ETFs above that.  (AVGO recently broke through this ceiling but it's the golden child so that's okay)
4. No individual stocks that don't pay a dividend.

The ROTH has been rule free, and ironically that has left me too much freedom to chase the wrong things.

I always try to ask hard questions.  I enjoy being challenged personally, even if it's just people asking stupid questions LOL.     

Rule: are good.  I abide by some core rules.  Well 95% of the time.  It's hard to be perfect.


YOUR RULES

#1.  Why a 2 1/2% yield requirement.  Is this a port average?  This is your tax advantaged account.  You can't spend the income without incurring a penalty.  Why not 2% or 4%?  

#2.  Good rule, it's stupid to get fined when you have the earned income to easily avoid it.  

#3.  Any individual stock is subject to a 20% correction.  It will happen fairly often.  $10K is just a number.  It's clear short-term losses cause you to make ill advised trades.  How large of a loss can you endure?  That should determine your maximum investment for a single positions.  You've been stressing short term dips that seem silly to some of us.    

#4 Personal preference I suppose.  There are some outstanding growth stocks that are still a few years away from paying a dividend.  Half of my good stocks don't pay a dividend.  All of my underperforming stocks pay a dividend.

1. 2 1/2% is a port average, which E*Trade shows at the bottom (because E*Trade rocks).  It's not my tax advantaged account; it's the taxable one.  I settled on 2.5% because, for one, that allows the account to pay enough towards my monthly budget.
3. Right; and that number will increase next year to $15k.  It's more like "no single stock can be more than 5% of the port".
4. I had been saving the pure growth stocks for the ROTH.  Yeah I need to re-evaluate that rule this year.

I will come up with some rules for the ROTH too.

Hope I am helping and not just beating you up because I get no joy in that.  Others here see your impulsiveness and I'd like to hope we are all trying to make you better at investing.  Your rules have to make sense in all markets because we are going to endure good, great and horrible over time.  I know it sounds corny but I am old.  If you are going to buy individual stocks you gotta be "Cool Hand Luke".

"Trim and add" strategies vs "all or nothing" is a skill that would benefit you.  Realize some gains instead of being greedy.  You don't have to sell it all.  Trim and cut your loss potential while it is small if your suspect your thesis for buying may have been flawed.  We can't know for sure what a stock does next week but we should be informed enough to know when a stock is running on pure MOMO or dropping on excessive fear not backed by fundamentals.  You will definitely lose in the end if you allow fear or greed to completely control your decisions. 

Hold for a decade stocks in your ROTH would be better but I'm not confident you'll do that.

Thanks for the tips.

Of course, I am reminded the ROTH is small potatoes when my company stock drops...

Your ROTH needs to be big potatoes but I get there are tax consequences.  You were smart to start trimming the company stock long ago whether it goes up or down. May have a bright future but not a blue chip


Tempted to buy today but we'll see if the dip has any follow through tomorrow.  Stand by for next rotation to who knows what sectors.  Closed some put sells for 85-95% profit this AM.  Waiting for my months long lucky streak to end.  It was a good day to be overweight defensive stocks.