WEB:The Oracle of Omaha- Warren Buffett
- Thruhiker
- MichaelC_AU
- MichaelC_AU
- MichaelC_AU
- JenL_3
- Hugs
- MichaelC_AU
- MichaelC_AU
- BillR_5
- KirkL
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» MichaelC_AU - Lemmings
Literally of course, a lemming is a rodent like creature that walk about in masses. Following the leader, haplessly and often we are told, right into the sea, to the helpless creatures death.To me being a lemming refers to doing the same thing that everyone else is which includes the current internet phenomena's momentum runs.
Examples of me as a lemming, I bought Intel in 1996, because, although I had followed it for 3 years in college, I was buying it because of its past success, and while I was not doing it to be like everyone else, I was buying the stock when everyone else was.
Often Warren Buffett would make a decision to buy a stock when no one else was interested. Often Peter Lynch would specifically look for companies with boring names, avoiding high techs, then analyze their financials.
This is often refereed to as Contrairian.
Let me say this Value stocks have lagged lately in this market, because there are fewer steals out there. That is why my main vehicle is VTSMX. But when I do dabble into individual stocks, I limit it to 5% on future purchases, and look for value. Never mind the huge accumulation of my former bank, employer's stock, that will be diversified in time. The sucess of which I dissmiss as good luck.
-- posted by MichaelC_AU
» MichaelC_AU - lemming
To further answer you question,yes, I think that a person that follows his broker's advice and buys a stock can be a lemming. But not necessarly because he followed the brokers advice, but because the broker themselves could be the lemmings, thus making you a lemming for following them.This is fun!
I don't think you should follow a brokers advice!
Like Brinker, the Motley Fool, and Peter Lynch all profess, YOU can decide better, and THEY don't want YOU to KNOW that!
Just stay in a money market until you feel ready and dollar cost average into an index fund when you feel comfortable and understand what you are doing.
Just read first start at www.vanguard.com or www.bobbrinker.com
Browse through One Up on Wall Street, Lynch's first book(even though index mutual funds are the way to go, especially at first) and The Millionaire Next Door(a book to motivate you to pay yourself 15%).
and read about loads, expense ratios commissions, don't pay a load or much of an expense ratio, especially for that first money market fund. The above is not to say that you, don't know all of this Hugs! I just thought it fit in with the topic of brokers.
-- posted by MichaelC_AU
» JenL_3 - Michael....
....I also would like to say...Congratulations!
Have a good time in...
<img src="http://www.cancun.com/images/chaanka1.gif">
.....Jen
-- posted by JenL_3
» MichaelC_AU - Good one Hugs!
It would be hard to avoid what the lemmings are doing in an index fund, but the lemmings themselves for the most part are not the indexers.Indexing is different. It is playing the percentages that say the stock index is guaranteed to average 10% over 20 year and greater periods. That is pretty darn good for doing no stock analysis.
Indexing is conceding I am no Warren Buffet, Peter Lynch, or any of the 1% of money managers that can beat the market. Indexing is saying I cannot pick the 10% of mutual funds that will out perform the market this year or the 1% of mutual funds that will average better than the market. 10% a year is excellent.
If everyone would just index 10% of their income there would be no need for welfare!
Indexing is pretty smart unless you are a fundamental analyst and do what the ones I have mentioned do sucessfully.
I perfer to use the index for the primary investment and dabble small time as do a lot of us here.
-- posted by MichaelC_AU
» MichaelC_AU - Nice post card Jen
Nice post card Jen!Thank you!
<img <img src="http://www.palaceresorts.com/images/4_pa...">
-- posted by MichaelC_AU
» KirkL - To add Bill
IF the 15% going to social (in)security went into an index fund, then we would not have to invest 10% to have a secure retirement!last yr I paid $4200. Figure HWP paid another $4200 for a total of $8400 to SS.
Lets assume 10% and a rotten, loaded mutual fund return of 8.5% annualized with 40 yrs of payments...
$3,717,777 @ 10% per yr
$2,483,733 @ 8.5% per yr
Figure you could annuatize that for over 30 yrs after putting it into a GNMA fund..... Check my math: 30 yrs, 6%, zero balance the $2,483,733 gives you an annual income of roughly $180,440!
Now look at Social INsecurity: retire in today's dollars and I get maybe $1500 a month or $18,000. Annuatize this over the same 30 yrs @ 6.0% and you get a net present value of $115,624
We are getting robbed to fund the general overspending in congress!
The government wants us to be stupid and not get a good education in math so you can't see how they are robbing us blind!
-- posted by KirkL
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