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  • The Changes I Made To My Portfolio [View article]
    Miguel/Slowly Learning - Will health care be the best performing sector over the next 10-20 years? Nobody knows, and those who say they do know, don't. As I said in the article, I avoid making big bets on uncertain outcomes.

    Teach English-The rules may differ depending on the 403(b) plan. Vanguard has told me several times that admiral funds are off limits.

    Jrez-The per fund exists even if we get electronic delivery of our statements.

    -Charles
    Nov 4 09:41 AM | 1 Like Like |Link to Comment
  • AAII Sentiment Survey: Bullish Sentiment Rebounds [View article]
    We average about 300 respondents to the Sentiment Survey.
    Aug 9 01:45 PM | Likes Like |Link to Comment
  • Streaks, Observations And Notes [View article]
    Dancing Diva,

    It is important to consider the prevailing yields at the time you are investing. If a stock's yield is considerably higher than the prevailing range for most quality stocks, then questions should be asked. Specifically, why is X stock yielding so much? What risks are other investors demanding compensation for.

    In the current environment, yields above 3.5% on quality stocks are hard to fine.

    -Charles
    Jun 10 10:10 AM | Likes Like |Link to Comment
  • Focus On The Fundamentals, Not The Story [View article]
    mfsjss,

    Model S priced at $62k after federal tax rebate - Telsa website: http://bit.ly/uVaZUY

    Consensus earnings estimates don't show a profit being made until 2014 - Yahoo! Finance - http://yhoo.it/ZiR9db
    May 31 10:59 AM | 1 Like Like |Link to Comment
  • AAII Sentiment Survey: Optimism At Second-Highest Level Of The Year [View article]
    The Recusant,

    The June AAII Journal will discuss the survey's response rates and how it has performed historically as a contrarian indicator.

    -Charles
    May 23 01:03 PM | Likes Like |Link to Comment
  • The Shrinking Dividend Yield [View article]
    Dollars withdrawn from dividends are shares that could have been purchased, which would have paid additional dividends. Either way, money is coming out of the portfolio.
    Apr 12 09:10 PM | 1 Like Like |Link to Comment
  • Dividends' Unintended Consequences [View article]
    SDS,

    Howard did not publish a list of the companies. Rather, he just sent me the numbers on how many companies have declared dividends, both regular and special.

    -Charles
    Dec 7 11:34 AM | Likes Like |Link to Comment
  • Lessons From Black Monday [View article]
    The two are not contradictory statements. Weak technicals are a sign something is wrong, but when everybody is fearful that the market is a in a freefall, buying opportunities often exist.
    Oct 22 10:13 AM | Likes Like |Link to Comment
  • AAII Investor Update: Stocks Are Pricey, But Inexpensive [View article]
    Table 2 has been updated. I incorrectly sorted the stocks when the article was first published, from high to low P/Es, when it should have been from low to high P/Es. Sorry for the confusion.

    As far as the comments, anchoring is a very common error among investors of all skill levels--and it is very important to be aware of it.

    Just look at all of the current chatter about Facebook. Yes, the stock is now $6 below its offering price, but it is still very expensive on a valuation basis. But, how much do you hear about the stock's P/E ratio?

    So is the article simple, yes? But, it's underlying point is very important.

    -Charles Rotblut
    AAII
    May 25 05:46 PM | Likes Like |Link to Comment
  • AAII Sentiment Survey: Bullish Sentiment Near A 2-Year Low [View article]
    K202,

    It should have read, "This is also the seventh consecutive week that bullish sentiment has been below its historical average of 39%."

    Unfortunately, the typo slipped by both me and my editors. I've asked Seeking Alpha to correct.

    Sorry for the confusion,
    Charles
    May 17 03:13 PM | Likes Like |Link to Comment
  • AAII Investor Update: How I Monitor My Stocks [View article]
    Pietrusikim,

    We have not announced the location yet. We'll probably make an announcement near the end of this year or early next year.

    -Charles
    Apr 20 09:29 AM | Likes Like |Link to Comment
  • Rewards May Exist in Muni Bonds [View article]
    Thanks Shanky.
    Jan 22 09:04 AM | Likes Like |Link to Comment
  • AAII Asset Allocation Survey: 11-Month High for Stock Allocations [View article]
    Hi,

    Thanks for being a member.

    It is a small percentage of total membership and we do not use random sampling for the surveys, so there are those caveats that must be considered when looking at the survey results. Nonetheless, there is a long history (which can be downloaded at AAII.com) to compare the current results against.

    As far as the ICI mutual fund flow data, they measure the fund flows for 95% of all mutual funds. Thus, the data includes both individual and institutional inflows and outflows.

    Our surveys provide insight, but I do not recommend using them as the sole indicator for judging market direction. Rather, I would look at several indicators before making a judgment as to whether stocks are looking more or less attractive.

    Hope this helps,
    Charles
    Dec 19 11:15 AM | Likes Like |Link to Comment
  • Income Strategies for a Low Yield Environment [View article]
    Kenji,

    I purposely left covered calls out of the article, because most of members (but certainly not all) do not use options. As to your comment about risk, a covered call strategy still leaves you exposed to a big drop in a common stock's price. Though covered-calls do provide some income, the post-transaction and post-tax profit may not be to provide much a cushion. (And yes, I realize this statement depends on several factors.)

    -Charles
    AAII
    Oct 18 11:11 AM | 1 Like Like |Link to Comment
  • Income Strategies for a Low Yield Environment [View article]
    Regarding MLPs, my understanding is that does not matter if the IRA is a traditional or an Roth, the UBTI rules apply the same. Here is what the National Association of Publicly Traded Partnerships says on the issue:
    There is a concept in the tax code (I.R.C. §§511-514) called “unrelated business income tax” (UBIT). Under the UBIT rules, tax-exempt institutions and retirement accounts must pay tax on income from a business that is not related to their exempt purpose (a university operating a business that had nothing to do with education would be an example).

    Because of the pass-through nature of an MLP--or any partnership (no tax paid by the partnership, all tax items flow through to the limited partners/shareholders, who pay tax on their share), the shareholders are treated by the tax code as if they are directly earning the MLP’s income. Thus, as a shareholder in the MLP, the IRA, 401(k), or other account is considered to be “earning” its share of the MLP’s business income.

    The tax is owed on the retirement account's share of the MLP’s taxable business income, minus its share of depreciation and other deductions related to the business, as reported on the K-1, (not on the quarterly distributions). There is a deduction that covers the first $1,000 of unrelated business income from all sources; after that, the retirement account will owe tax.

    It is important to remember that you are not the one who will owe any unrelated business income tax on MLP units held in your retirement account. The tax is owed by the IRA, 401(k), or other account itself. It is the responsibility of the custodian of the account to file a tax return (form 990, the return for tax-exempt organizations) and pay any tax owed out of the account’s funds.

    You should also note that the tax applies only to the income allocated to the retirement account each year while it holds the MLP units. It does not affect the treatment of capital gain realized when the units are sold. This would remain exempt from taxation.
    Oct 18 11:04 AM | Likes Like |Link to Comment
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