Investing in the stock market - Discussion

[NucksPatsFan]

8 hours ago, Tortorella's Rant said:

yes. I am very conservative with my money so the thought of losing some makes me sick. I hear different things all the time. I dunno what the hell to believe. Do investors really beat the market though? It The djia was almost a 25% gain in 2016 alone. If someone told me they could increase my money by 25% in a single year I'd likely tell them to gtfo. 

There will be single stocks each year that will beat the market, but the next year may match the market or underperform. 

 

Long term, I think if you looked at that 25% gaining stock over 10 years vs an etf, I think the 10 year better gainer would be the etf. 

 

Nothing is guaranteed. No matter how certain you could feel a stock is going to take off for a company, it's still a risk

[Tortorella's Rant]

3 hours ago, NucksPatsFan said:

There will be single stocks each year that will beat the market, but the next year may match the market or underperform. 

 

Long term, I think if you looked at that 25% gaining stock over 10 years vs an etf, I think the 10 year better gainer would be the etf. 

 

Nothing is guaranteed. No matter how certain you could feel a stock is going to take off for a company, it's still a risk

I think ETFs, index funds, dividend funds, and maybe even some blue chippers that all pay quarterly returns is the way to go. It is effectively couch potato investing one guy described it.. All you do is simply reinvest those dividends which are done automatically, contribute at tax season, and rebalance biannually. So when the markets do tank and share prices take a hit, you are still generating dividends. And the fees are uber cheap. I just have to study a bit what to buy and inquire what my boss has bought and feels comfortable with.

Wealthsimple even suggested some recommendations. By all accounts this is supposed to be so easy you need almost no education in investing. My boss does this and he is very comfortable with it while I'm here having an anxiety attack because the guy I'm paying 2% lost me $5,000 in about two weeks. He is telling me that 2019 may be a great year for stocks or you may suffer double digit losses. And considering he never protected my principle, if I suffer another loss like this or worse .. I dunno.. I'll lose it.

 

I set up a Wealthsimple account the other day and have a call with one of their guys on Monday. I have a whole ton of questions about what he thinks about this, and how I simply move all of my stocks and cash over from these accounts to Wealthsimple. 

Edited January 19, 2019 by Tortorella's Rant

[Vanisleryan]

I still believe the best way to success is investing yourself. I refuse to pay anyone fees to earn me a measly 5 to 7 percent. Over the past 2 and half years Ive done 210% annualized and over 2000% over the entire 2 and half years. Trust me Im no rocket scientist and this just involved learning everything I could about the cannabis sector and selling after big run ups and buying back in after they dropped and consolidated. 

[Lancaster]

The entire market as a whole for the last century (probably even further back) up to the present has an average annual return of like 8%.  

 

[Tortorella's Rant]

2 hours ago, Vanisleryan said:

I still believe the best way to success is investing yourself. I refuse to pay anyone fees to earn me a measly 5 to 7 percent. Over the past 2 and half years Ive done 210% annualized and over 2000% over the entire 2 and half years. Trust me Im no rocket scientist and this just involved learning everything I could about the cannabis sector and selling after big run ups and buying back in after they dropped and consolidated. 

I think you are right. I think this may be the way to go after all based on what I am reading. I've read nothing but good things so far from what people are saying doing it themselves, especially one I know of personally I can speak to directly about this. It's 2019 and it's been really simplified. One described his portfolio as couch potato investing. You buy index funds with dividends which track the S&P for example, ETFs with dividends, allow the provider to automatically reinvest the dividends, and that's it. It is extremely diversified. I think this is wiser than a managed portfolio largely of common stock and no dividends charging 2% and extreme volatility where a few bad buys in your portfolio consisting of two dozen companies tanks big time.
 

I still have some questions for the call Monday but I feel better about what I am reading and will quite possibly transition in 5 - 8 weeks.

Edited January 19, 2019 by Tortorella's Rant

[Canorth]

@Tortorella's Rant

 

What do you mean by "rebalance bi-annually"?

 

I'm pretty new at this as well, but you seem much farther along than me.

[NucksPatsFan]

5 hours ago, Tortorella's Rant said:

I think ETFs, index funds, dividend funds, and maybe even some blue chippers that all pay quarterly returns is the way to go. It is effectively couch potato investing one guy described it.. All you do is simply reinvest those dividends which are done automatically, contribute at tax season, and rebalance biannually. So when the markets do tank and share prices take a hit, you are still generating dividends. And the fees are uber cheap. I just have to study a bit what to buy and inquire what my boss has bought and feels comfortable with.

Wealthsimple even suggested some recommendations. By all accounts this is supposed to be so easy you need almost no education in investing. My boss does this and he is very comfortable with it while I'm here having an anxiety attack because the guy I'm paying 2% lost me $5,000 in about two weeks. He is telling me that 2019 may be a great year for stocks or you may suffer double digit losses. And considering he never protected my principle, if I suffer another loss like this or worse .. I dunno.. I'll lose it.

 

I set up a Wealthsimple account the other day and have a call with one of their guys on Monday. I have a whole ton of questions about what he thinks about this, and how I simply move all of my stocks and cash over from these accounts to Wealthsimple. 

Any one who doesn't protect your principle should be fired immediately. Shouldn't even be a second thought to it. 

[Tortorella's Rant]

1 hour ago, NucksPatsFan said:

Any one who doesn't protect your principle should be fired immediately. Shouldn't even be a second thought to it. 

Stupid question, but it's not like I am getting a whole ton of help on this directly. What does that entail? Have CIBC transfer my money back to them? I'm not committed to the whole WS thing yet. And that can take a few weeks. And the problem is I have a bunch of shares already in play. I don't know what to do with those. I would be worried that my guy would stupidly sell off the losers again.

[NucksPatsFan]

3 hours ago, Tortorella's Rant said:

Stupid question, but it's not like I am getting a whole ton of help on this directly. What does that entail? Have CIBC transfer my money back to them? I'm not committed to the whole WS thing yet. And that can take a few weeks. And the problem is I have a bunch of shares already in play. I don't know what to do with those. I would be worried that my guy would stupidly sell off the losers again.

Does the guy you use work for a company? 

[Vanisleryan]

The problem with parking your money in mutual funds is that most people dont have enough to have their portfolios actively managed. My bank told me its at least 100k to qualify for an actively managed account, otherwise your just blindly parking your money and riding the ups and downs, and as the commercial goes... Its a long term game... Which is great for the bank as they collect more fees. 

[Canorth]

6 minutes ago, Vanisleryan said:

The problem with parking your money in mutual funds is that most people dont have enough to have their portfolios actively managed. My bank told me its at least 100k to qualify for an actively managed account, otherwise your just blindly parking your money and riding the ups and downs, and as the commercial goes... Its a long term game... Which is great for the bank as they collect more fees. 

My impression was that mutual funds are actively managed as a whole. Regardless, of the size of the investment, every investor owns a part of the same holdings - how large of a portion is dependent on the size of the investment. I thought that was whole point of mutual funds - to allow smaller investors access to otherwise inaccessible investments? 

[Tortorella's Rant]

13 hours ago, NucksPatsFan said:

Does the guy you use work for a company? 

He works at a bank, it's his own name on the wealth management group

Despite feeling very good at the start of all this last summer with some decent unrealized gains north of a few thousand dollars, this has become the worst experience of my life. My guy told me my portfolio could do real well this year and I was also told I could suffer double digit losses depending on certain factors. But evidently I have zero assurances for protecting my principle hence this whole discussion and that terrifies the hell out of me. I would have been better off with CIBC and I would still have my money even if it didn't grow much and I would absolutely take that ease of mind right now.

I have a couple calls tomorrow including one with my guy and a face to face meeting with another group to get their take on all of this but I've never felt more lost and useless as I do right now.

 

[NucksPatsFan]

1 hour ago, Tortorella's Rant said:

He works at a bank, it's his own name on the wealth management group

Despite feeling very good at the start of all this last summer with some decent unrealized gains north of a few thousand dollars, this has become the worst experience of my life. My guy told me my portfolio could do real well this year and I was also told I could suffer double digit losses depending on certain factors. But evidently I have zero assurances for protecting my principle hence this whole discussion and that terrifies the hell out of me. I would have been better off with CIBC and I would still have my money even if it didn't grow much and I would absolutely take that ease of mind right now.

I have a couple calls tomorrow including one with my guy and a face to face meeting with another group to get their take on all of this but I've never felt more lost and useless as I do right now.

 

One of my best friends is a partner at an accounting firm in Burnaby and he said rule #1 is protect the principle investment - unless the client specifically wants a high risk portfolio but there's other paperwork that gets signed that responsibility of the total loss of principle falls on the client etc etc. 

 

What's your guys' credentials/experience? Is he just a "financial advisor" with a BBA with no track record? 

 

The unfortunate thing about firing him is you're essentially saying "liquidate what I'm invested in now and I will take all my cash to my bank account" so you will realize the losses. 

 

You could wait to see until you break even then fire him, but you also risk losing more in that time frame 

[Tortorella's Rant]

1 hour ago, NucksPatsFan said:

One of my best friends is a partner at an accounting firm in Burnaby and he said rule #1 is protect the principle investment - unless the client specifically wants a high risk portfolio but there's other paperwork that gets signed that responsibility of the total loss of principle falls on the client etc etc. 

 

What's your guys' credentials/experience? Is he just a "financial advisor" with a BBA with no track record? 

 

The unfortunate thing about firing him is you're essentially saying "liquidate what I'm invested in now and I will take all my cash to my bank account" so you will realize the losses. 

 

You could wait to see until you break even then fire him, but you also risk losing more in that time frame 

I don't know. I didn't do my due diligence getting involved because I didn't know any better. I only went along because I wanted to move and my uncle is very happy with this guy. But I don't think he knows as much as he thinks he does either. 

 

I was hoping to maybe just liquidate all of my winners and hold onto my losers and I will personally deal with them after I transfer. I don't know if this is a thing. He has these Alberta energy stocks which have done nothing but get obliterated and the dividends do nothing as they effectively go to pay fees. It's like they are a way of keeping me on board.

Edited January 20, 2019 by Tortorella's Rant

[Vanisleryan]

10 hours ago, Canorth said:

My impression was that mutual funds are actively managed as a whole. Regardless, of the size of the investment, every investor owns a part of the same holdings - how large of a portion is dependent on the size of the investment. I thought that was whole point of mutual funds - to allow smaller investors access to otherwise inaccessible investments? 

When I say actively managed, I mean your financial guy actually selling them high and buying back lower. Yes mutual funds are reballanced all the time. 

[NucksPatsFan]

Put a limit order for micron waste technology this morning. Really liking their potential. Wanted to buy last week but they had a crazy run up. 

[Tortorella's Rant]

Anyway, it's over with my portfolio manager. It's just a matter of time now. We had a call and I hinted at moving away and that's what he recommended too after my couple emails on the weekend about my concern for loss and other alternatives, which he did not appreciate. His entire fund sees over 500 million in assets and my dinky $100,000 portfolio isn't worth dedicating himself to. Basically it was summed up that they sold into the rally and bought into the dip. Hence the "crash" he put it during December, but the market was already well into falling at that point. So this concept I don't get. And then if you are going to purchase the same shares two weeks later only to sell a couple weeks later after that, then why sell at all in the first place. I didn't really bother question this or get very critical about it because his knowledge of the market and economy vastly exceeds what mine ever will. He told me there could be double digit losses this year but his goal as fund manager is to minimize those losses and ultimately beat the index. Historically speaking, from everything I've read, you cannot beat the index long term. He suggested ETFs and Index funds are fine if you are comfortable with that but I believe he also said if you bought an index fund which tracked the TSX you would be up 2% this year. Which also doesn't make a whole lot of sense to me considering I'm down 5%. 

 

Anyway, I obviously don't have the kind of capital nor salary to endure or brush off double digit losses. Clearly this was never considered when I first got involved.

[NucksPatsFan]

On 1/21/2019 at 10:45 AM, Tortorella's Rant said:

Anyway, it's over with my portfolio manager. It's just a matter of time now. We had a call and I hinted at moving away and that's what he recommended too after my couple emails on the weekend about my concern for loss and other alternatives, which he did not appreciate. His entire fund sees over 500 million in assets and my dinky $100,000 portfolio isn't worth dedicating himself to. Basically it was summed up that they sold into the rally and bought into the dip. Hence the "crash" he put it during December, but the market was already well into falling at that point. So this concept I don't get. And then if you are going to purchase the same shares two weeks later only to sell a couple weeks later after that, then why sell at all in the first place. I didn't really bother question this or get very critical about it because his knowledge of the market and economy vastly exceeds what mine ever will. He told me there could be double digit losses this year but his goal as fund manager is to minimize those losses and ultimately beat the index. Historically speaking, from everything I've read, you cannot beat the index long term. He suggested ETFs and Index funds are fine if you are comfortable with that but I believe he also said if you bought an index fund which tracked the TSX you would be up 2% this year. Which also doesn't make a whole lot of sense to me considering I'm down 5%. 

 

Anyway, I obviously don't have the kind of capital nor salary to endure or brush off double digit losses. Clearly this was never considered when I first got involved.

What's the old saying.. You judge character not by how someone treats the CEO but how they treat the janitor? 

 

Whether you had 10 million or 10k invested with the guy, he should've given you his best client care practices. Sounds like a POS to me who probably doesn't know too much more than the average investor. 

[Ronaldoescobar]

On 1/20/2019 at 9:56 AM, Canorth said:

My impression was that mutual funds are actively managed as a whole. Regardless, of the size of the investment, every investor owns a part of the same holdings - how large of a portion is dependent on the size of the investment. I thought that was whole point of mutual funds - to allow smaller investors access to otherwise inaccessible investments? 

Depends on the fund actually. Most are actively managed but there are index funds that are passive and just track the market (expect a return to trail the market by the MER though). I would not look at those as they are more expensive than an EFT for pretty much the same thing.  If looking for decent MFs that have a pretty good track record in beating benchmarks in a sector that usually trails market returns, I would check out RBC Global Asset Management (specifically their suite of PH&N funds) or Mawer. Both have very low fees compared to the industry average. The only thing to remember is that MFs are long term investments for the most part and should not be traded like individual securities as that is a sure way to lose money. 

Edited January 24, 2019 by Ronaldoescobar

[Tortorella's Rant]

9 minutes ago, NucksPatsFan said:

What's the old saying.. You judge character not by how someone treats the CEO but how they treat the janitor? 

 

Whether you had 10 million or 10k invested with the guy, he should've given you his best client care practices. Sounds like a POS to me who probably doesn't know too much more than the average investor. 

I dunno. I don't want to be too critical because he is obviously successful at what he does - very successful. And I've been at this 8 months. But as was always my understanding that once you suffer realized loss in principle, it is time to get the hell out of dodge. Especially when further risks of double digit losses ahead have been made aware. They did not do anything to assess where I was, what I knew, and what my expectations were when I started this and I was too much of a beginner to question any of what I was being told - which was almost nothing.

 

Anyway, we have cashed out and are in the process of transferring elsewhere to different portfolios with a more hands on approach, if you will. We retained some stocks we like and because of the dividends they pay, but we are effectively out of the market now for the time being. 

I am pretty much out of the mental hell I was in for the past week.