I sold my Best Buy (BBY) stock on July 12 during the stock market surge. After fees I only netted about 4% from my stock purchase of BBY, however, I did not own it very long and I was concerned about retail in general.
That 4% taken over the year equals 20-30% return, not bad. I still like Best Buy the company, but I do see retail in general doing poorly short-to-mid-term which will drag BBY as well. Also, Wal-Mart is currently taking on Best Buy and Circuit City, and Circuit City is paying the price. I do not think BBY will fall apart like Circuit City, but Wal-Mart is a behemoth. Short-term, you do not want WMT to start being a direct competitor; long run who knows what will happen, but BBY will need to adapt or it will be suffer a mortal wound as Circuit City has.
Written by Nagel on July 15th, 2007 with no comments.
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Return on Capital is a measurement used for profitability, using net income divided by invested capital. This result shows how effectively a company is employing its capital to produce profits.Below are the top 5 stocks in regards to a three-year average of return on capital.
- Bare Escentuals (BARE)
- Alliance Resource Partners (ARLP)
- ITT Educational Services (ESI)
- Mannatech (MTEX)
- Applix (APLX)
Obviously, ROC is not the only criteria to use when measuring stocks. All you have to do is look at MTEX and see that its stock price lost almost 1/4 of its value in one day of trading recently. So, as always, do your homework.
Written by Nagel on July 14th, 2007 with no comments.
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If you are having a hard time saving money, here are some quotes to inspire you.
Written by Nagel on July 12th, 2007 with no comments.
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Yes, there is an E-LOAN bank, it is not just a popular loan website.
My wife and I have an E-LOAN savings account and so far things have worked out very well. The E-LOAN rate we get on our savings is about 5.25%, and we recently increased our balance by making a big deposit. I set up a link between my checking account on Everbank.com, and my E-LOAN savings account. This makes the transfer seamless and easy. We are hoping to load up our savings account with 6-12 months of expenses as an emergency. If everything goes well we might be able to accomplish that by early 2008.
Between our checking and savings accounts we average about a 4% APR, which is well above the national average and is keeping up well with inflation.
Written by Nagel on July 10th, 2007 with no comments.
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Sales Growth is often an important component when deciding on whether to purchase a stock or not. It is not the only aspect to look at, but it is interesting to see how their growth in sales correlates to their stock price perfromance.
Based on average sales growth for the past three years here are the top 5 publicly traded companies:
- Arena Resources (ARD)
- Penn Virginia Resources Partners (PVR)
- Heelys (HLYS)
- TGC Industries (TGE)
- Flotek Industries (FTK)
Written by Nagel on July 8th, 2007 with no comments.
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Despite the rise of ETFs and other new types of investments, mutual funds remain a popular long-term investment option for all types of investors. An important aspect for investors to keep in mind is to diversify their holdings. I will give the top 5 mutual funds, one from a different investment category so you can get a well-rounded portfolio.
I will take Money Magazine’s top mutual fund from five different categories to create this portfolio.
Large Cap
Vanguard Windsor II (VWNFX)
It combines the best 3-year performance numbers of all the Money Magazine’s top large cap mutual funds with a low expense ration of 0.34%.
Mid Cap
Vanguard Mid Cap Index (VIMSX)
This is an index fund that outstrips most professional managed mid cap funds while having a miniscule 0.22% expense ratio
Small Cap
Vanguard Small Cap Index (NAESX)
Another index fund proves its worth with a 17.6% annualized 3-year return with a small expense ration of 0.23%.
Specialty
T. Rowe Price New Era (PRNEX)
This fund focuses on a blend of growth and value large cap natural resource companies. It has agrnered almost 33% annualized over the past 3 years and has a nice low expense ratio of 0.67%.
Foreign
Vanguard Emerging Markets Stock (VEIEX)
Foreign mutual funds have been hot lately, but few have hotter than VEIEX. 37.4% annualized return for the past three years with an unbelievably low 0.41% expense ratio.
Written by Nagel on July 7th, 2007 with no comments.
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Each year, my wife and I estimate healthcare costs in order to plot out our medical flexible spending. It is perplexing to consider why you have to guess at how much you might spend on health care costs over a year in order to get a tax break, but those are the rules.
So we sit down and look at what we have spent in medical necessities over the past year and try to guesstimate what costs might differ and by how much to try to get an accurate medical flexible spending final amount.
Once we determine the amount for the year 1/26 of that amount is taken from each paycheck, pre-tax. It is a wise choice to make and we always pass the amount we estimated, however, it is a nice little tax break to bring into the fold.
Written by Nagel on July 6th, 2007 with no comments.
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The first half the my family’s fiscal year budget 2007 is up and I wanted to see how we have done so far. Budget 2006 and Budget 2007 differ mightily for several reasons. One is that in 2006 we bought a house and in 2007 we have had home improvements in addition to me being laid off for a month.
Even with the expenditures and lost revenue over the past six months we are still in a stable financial position and over half-way to our goal of having 6-12 months of expenditures saved in an emergency fund in case a job is lost or someone falls ill or is injured.
We have no credit card debt; I paid off my student loan and currently all we owe is our mortgage and car payment.
By the end of 2007 we hope to have that emergency fund fully funded as well as having our Roth and traditional IRAs maxed, and my wife’s 401k maxed to the employer match.
We will revisted our budget goals in six more months and will see how we are doing.
Written by Nagel on July 5th, 2007 with no comments.
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I try hard to be a rational investor and not panic when I hear bad news about a company I invest in. I have try even harder to ignore the nattering nabobs of negativity when broad economic news is released, and it looks bad.
However, the murmurs I heard last year about how the stock market is due for a reversal have turned into roars. As I have said before, being a contrarian can be very profitable. I have also said it is impossible to time the market and get in and out at exactly the precise time. But sticking in the market is getting to be a tougher proposition for me in the short term. More and more pundits or investment professionals see at least a small downturn coming if not a huge 10% slide. Wall Street has a heard mentality, and no matter if the negativity is created out of real or perceived problems; soon it will not matter.
A tipping point will occur soon, if it has not already happened, that the stock market must have a period of negative returns to appease the investing gods. Once that happens a small downturn like at the end of February could turn into to a massive exodus from the market, especially if investors behave as they did and do in regards to the housing market.
What do you think?
Written by Nagel on July 3rd, 2007 with no comments.
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I keep a master budget for our family spending in order to track all the money that comes in and goes out.
It is not easy to remember to keep all the receipts for each purchase made or remember when you have paid cash for something. Equally as difficult is to remember to post income that is extraordinary, such as gifts or reimbursements. However, in the end, if you keep track of everything in a master budeget you can see month-over-month and year-over-year trends in spending and this information can go a long way in helping you spend you money wisely and on things that matter.
Written by Nagel on July 2nd, 2007 with no comments.
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