Stocks and Investments Talk (1 Viewer)

[Ronald Epstein]

Hard to tell if there is a thread dedicated to the discussion of stocks.

The site's Google Search does a very limited job of bringing up results when putting in keyword, "Stocks."

So, if I am starting a thread that already exists, please alert me and I will gladly move this conversation to that existing thread.

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I am no expert when it comes to investing. I have invested a lot of money in the market, and have done reasonably well.

Reason being, I don't take risks. I put my money into strong companies who pay dividends, and I am quite diverse with my choices -- not putting everything into one category of stock (tech, food, gas, etc.).

So, here I am asking for advice on a potential stock investment.

AMAZON

Now THERE is a stock. It's a strong stock. It should continue to grow as the company is just dominating everything.

However, the price per share is now over $725 per share (at the time of this post).

I have $8k I want to invest in Amazon. It won't buy me much, but it will get me into a company I am very fond of.

Is it worth purchasing when I am getting so little shares for the money?



Please use this thread, if one does not already exist, to talk about stocks, the market itself, and ask for advice.

 

[Scott Merryfield]

We have used a financial planner for over 20 years to manage our investments, and she has always been against buying individual stocks, instead going with mutual funds of diverse types. We have done very well with this planner. However, there was a case many years ago where I felt very strongly about a specific company, and she said if I felt that way then we should invest in some shares. That company was Cisco Systems, and the stock ended up doing exceptionally well, splitting several times.

So, Ron, my advice would be if you feel very strongly about Amazon, then go ahead and invest. Honestly, if you have a strong portfolio, "gambling" $8k on a company you feel very good about is not that much of a risk.

 

[Ronald Epstein]

Thanks, Scott.

I do feel very strongly about Amazon. I now just have to sit and watch, over the next few days, the price before I decide to jump in.

 

[Sam Posten]

I definitely recommend investing in Amazon during July of 1997....

Buying $8k worth of Amazon in 2017 is going to get you 10 and a half shares. What kind of action are you going to need that to move the needle to make more than your fees after holding long? If you hold it for 10 years and it goes to $1500 a share will it have been worth it to you? With its current market cap do you see room for growth that will excite investors to more than double it in that term?

 

[DaveF]

Investment advice is like a box of chocolates...or something...

My core beliefs are based on Malkiel's "A Random Walk Down Wallstreet" and John Bogel's Vanguard: invest in low-cost, broad index funds using dollar-cost averaging for your long-term savings and retirement.

If you can afford it, and enjoy gambling, invest in some individual stocks according to your own tastes, analyses and risk tolerance.

I had invested in Amazon for a while, and sold it. Had I kept it, I'd have made a some money. But fundamentally, I didn't -- and don't -- understand Amazon's valuation. Their profit margins are minuscule -- grocery-store margins -- but are valued like a go-go dot-com from 2001. The P/E ratio is less insane now, reduced from ~3000 to ~300.

Yet Amazon is of FANG (Facebook, Amazon, Netflix, Google) that comprises (I've read) the bulk of the stock market's growth the past couple years.

Arguably, buying into Amazon now is buying late, being a follower, which is conventionally the worst way to buy hot stocks. Unless Amazon has years more hyper stock-price growth to go. In which case you'll make out like a bandit.

Personally, I own two individual stocks right now. I'm about ready to sell and be done with individual stocks. I go through cycles, where I get sporty and buy some stocks. And they they go nowhere and make a little on A and lose a little on B and the whole thing is a wash and I'm frustrated by the whole affair. Because I don't have the interest or time to attend to individual stocks on the daily or weekly basis that they need.


So, is Amazon a good buy? No one knows. If they continue on current pace, that $8k could be $32k this time next year. Or the market might get spooked, drop the P/E to that of Apple, and the $8000 becomes $800.

Good luck either way!

 

[Scott Merryfield]

I definitely recommend investing in Amazon during July of 1997....

If we are hopping in that Delorean, let's almost make a couple of other stops and pick up some Microsoft and Apple stock, too.

While our investment strategy is quite similar to Dave's relying on mutual funds, sometimes a person just has to satisfy that craving to buy a particular company stock, and Ron seems to have that itch with Amazon. Personally, I wouldn't buy into them right now, but with a balanced portfolio gambling $8K would not be the end of the world.

We only own one individual stock -- our original shares of Cisco Systems. We sold off the additional shares from all the splits long ago, but for some reason hung on to some shares. We should probably just sell those shares, too, but it's such a small slice of our portfolio that hanging onto them is not a big deal. At least Cisco pays dividends now.

 

[Jim517]

Don't buy any stock unless you can afford to lose the money. I also love Vanguard, and use index mutual funds only.

 

[Aaron Silverman]

Index funds are the way to go for long-term investments.

Maybe find a blue-chip stock that pays dividends, and have the dividends reinvested.

 

[Ronald Epstein]

So, looking at my portfolio.

I have Tesla stock. Miraculously I have not sold it because I believe its a company that still has a chance to go somewhere -- especially for its battery division.

What I am worried about is Netflix. I am thinking of selling Netflix as a profit and buying Disney. Disney has a bright future ahead of it with its acquisition of Fox and the streaming potential as well as their Star Wars theme park that is going to attract millions.

 

[DaveF]

I don't have any advice for individual stocks. I've got a few shares of Shake Shack that are still underwater, that I'll sell when/if they're even again.

Below is my investing goal. I dumped bonds belatedly last year; the bond market was flat for a decade and only looks to continue to suffer. That diversification wasn't helping me. I'm getting back into the international market. I maintain the REIT (real estate), though with rising interest rates I don't know if that's going to be losing steam in the near future.

401k and IRA are "Target Retirement" funds that keep a broad-market stock/bond mix that shifts more conservatively over the years, so I don't have to keep track of re-balancing my fund mix manually (which in the past I'd always forget and repeatedly wind up with a quasi-random, unbalanced mishmash of investments).

Vanguard Total Stock Market Index
Vanguard International Growth Fund
Vanguard Real Estate Index

 

[Robert Crawford]

So, looking at my portfolio.

I have Tesla stock. Miraculously I have not sold it because I believe its a company that still has a chance to go somewhere -- especially for its battery division.

What I am worried about is Netflix. I am thinking of selling Netflix as a profit and buying Disney. Disney has a bright future ahead of it with its acquisition of Fox and the streaming potential as well as their Star Wars theme park that is going to attract millions.

Ron,

Do you have a retirement specialist? If not you might want to investigate getting one as they can advise you about your portfolio and when to get out of the stock market to protect your 401K assets. Also, how to invest your assets upon retirement. I ended up getting out of the stock market six months before my retirement and it saved me thousands as the stock market took a dip just prior to my retirement.

 

[Scott Merryfield]

We've used the same financial planner for over 25 years. Like Robert, we made changes to our asset distributions as I neared retirement. We did not get completely out of stocks, but did reduce our percentage and risk. We continue to make adjustments since retiring, as well as convert rollover IRA funds to our Roth IRAs.

As you get close to retirement, having a professional to help navigate your options is essential, IMO.

 

[DaveF]

Yep. I don’t know if Ron is talking about play money, or whether to move a significant portion of his retirement funds from one risky individual stock to another risky individual stock.

 

[Ronald Epstein]

I do have a financial advisor.

On top of what he looks after for me, I also have added funds in the stock market.

I don't buy anything risky. Telsa is perhaps the riskiest stock I own. Most of the stocks are dividend payers.

Usually, when I buy a stock I hold on to it no matter what. I don't day trade. I leave the stocks alone.

My only concern is Netflix vs. whatever Disney may be up to now.

 

[Patrick Sun]

Once upon a time, back in the 90's, I think I had 100 or 200 shares of AMZN. Had I just held on to it all this time... sigh...