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Brian Abbott

 
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  • Using The Leverage Of Long-Term Bonds In Your Portfolio Allocation [View article]
    I'd love to backtest. The simplest way might be to just pick arbitrary 1, 3 and 5 year static returns without assuming rebalancing etc. Funny... some people want the backtesting, and others downplay it once you present it. With the run that bonds have had I bet the backtest would look good, but the criticism would be that it wouldn't include a time of rising interest rates. (But those same critics have been saying rates would rise for several years now.... they'll be right eventually, I guess!)
    Jan 10 02:30 PM | Likes Like |Link to Comment
  • A Retirement Income Portfolio [View article]
    in order for the cost basis to be reduced, doesn't that mean you were just getting return of capital?
    Jan 6 09:11 PM | Likes Like |Link to Comment
  • Picking Goldman's Brain for Long / Short Strategies [View article]
    do REITs take out mortgages tied to individual properties, or are they paying cash for individual properties and raising that cash via debt sold through the capital markets (or through equity issuance)?
    Jan 5 11:38 PM | Likes Like |Link to Comment
  • Have Asset Classes Really Become More Correlated Since The 2008 Financial Meltdown? [View article]
    yes, they were daily correlations. (In an older analysis I used weekly, but had to obtain the primary data and run it through a stats program.) The online correlation sources don't give you a choice other than daily on the ones I've seen.
    Jan 2 01:28 PM | Likes Like |Link to Comment
  • Have Asset Classes Really Become More Correlated Since The 2008 Financial Meltdown? [View article]
    Please educate us. I understand why a zero correlation is beautiful. But not a nearly -1.0 correlation, other than reducing beta. While perhaps worthwhile in itself, that isn't producing diversification. What have I missed?
    Jan 2 01:26 PM | Likes Like |Link to Comment
  • Apple: Don't Follow The Herd [View article]
    Nice article. Nothing like seeing the critics come out in force with the slightest commentary about AAPL that is anything short of religious. This stock is the most over-owned thing I've seen since the 2000 nasdaq bubble. Any mutual or hedge fund I look at has it as a top holding it seems like. Who's left to buy?
    Jan 1 10:36 PM | Likes Like |Link to Comment
  • The Innovator's Dilemma: Is Apple A Sustainer Or Disrupter? [View article]
    Great points. AAPL could afford to take chances and be disruptive when its stock was languishing and Jobs was making a comeback. Now, fast forward a few years to the present, and they have the largest market cap and huge market share. Hard for me to believe the next 10 years will be like the previous 10. Maybe they have a few disruptions up their sleeve, but they have a much larger constituency to please now than they did 10 years ago.
    Jan 1 09:15 PM | Likes Like |Link to Comment
  • The Innovator's Dilemma: Is Apple A Sustainer Or Disrupter? [View article]
    >>the real question is will there be another major disruption out of Apple?

    yes, I think that is the key question. Most commentors here are arguing about whether iPod or iTunes were disruptive and how I just don't get it.

    From an investment standpoint, the real question should be - what are they doing NEXT, as you ask.
    Jan 1 09:12 PM | Likes Like |Link to Comment
  • The Innovator's Dilemma: Is Apple A Sustainer Or Disrupter? [View article]
    thanks bgold. Hopefully you didn't take my article as critical of AAPL. I was just trying to apply the ideas in a book I just read to this company, as AAPL is the most successful technology company lately. I just wanted to highlight a sort of "winner's curse" that has stalked many companies that have previously occupied their position.
    Jan 1 12:35 PM | Likes Like |Link to Comment
  • The Innovator's Dilemma: Is Apple A Sustainer Or Disrupter? [View article]
    Well I don't think the public is that stupid - they obviously are willing to pay a hefty premium so they must perceive some value from it - but I obviously agree with you that Apple has been better at design and marketing than in creating disruptive innovations.

    Maybe it would be more accurate to say that Apple's disruptiveness is in marketing and in design, not in the technology itself. But the larger point is that based on Christensen's research, few leading companies succeed at disrupting; it usually new entrants who do that.
    Jan 1 12:00 PM | Likes Like |Link to Comment
  • Endowment-Style Strategies For Individual Investors, Pre-2007 [View article]
    thanks for the comment, and the tip on BDCS - I wasn't familiar with that one. Yes, I declined to include PSP for the reasons you mentioned. There is an ETF (KCE) that includes a few BDCs as well as publicly traded investment banks. I used to follow this space quite closely but got very disillusioned after the 2008 debacle and moved on to offshore drilling and reinsurance as primary focal points. I think you are right, they are closet to junk bonds than to private equity. Now that I think about it, maybe Blackstone (BX) would be a better proxy for private equity - or also Carl Icahn's company (IEP).
    Jan 1 11:36 AM | Likes Like |Link to Comment
  • 5 Value Dividend Stocks For Investing Like A Contrarian [View article]
    Not to quibble, but Aspen (AHL) price to book is 77% per the 3rd quarter earnings statement and recent stock price. Still a good value, but quite different from 60%. The only reinsurer to get close to 60% was Flagstone (FSR), at which point it recently got acquired by Validus (VR). For some reason, some websites can't get the book value right. For my reinsurance list I always get it right from the earnings releases. I update it quarterly and intend to publish the list here each earnings seasons. Cheers and happy new year!
    Dec 31 08:52 PM | Likes Like |Link to Comment
  • Writing Uncovered Put Options On Reinsurance Stocks [View article]
    JWG- Yes, I'd much prefer showing the actual figures than a rough estimate, but unfortunately it spans numerous batches of puts and calls sold over 3-4 years, plus dividends. The actual capital gain alone is 12.2% of the total sales that occured last Friday on option expiration / covered call assignment (per my broker's records), but only a small portion of the stock position was held the whole time, with additions occuring as recently as 6 months ago.

    The IRR would be more trouble than it's worth to figure, from a personal standpoint, but you raise a good point. We should always try to be objective rather than guessing about how our strategies are performing. You are right, the returns would be lumpy. There definitely were time spans when the whole position was under water.
    Dec 31 08:45 PM | Likes Like |Link to Comment
  • Comparing Berkshire Hathaway To Other Reinsurance Companies [View article]
    I didn't notice a maximum exposure in the 10Q footnotes. But what I do often read about is how it is European style and so they can't be exercised early, and that also keeps it from needing to be marked to market or something along those lines.... kind of like "Don't worry about it". It is really nothing more than a massive long-term bet.... gambling.
    Dec 31 05:36 PM | Likes Like |Link to Comment
  • Fiscal cliff negotiations between Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell hit a major snag after Republicans demand use of the "chained CPI" method for calculating entitlement benefits - which would result in lower payments for Social Security beneficiaries. Pres. Obama backed the provision previously, but Democrats now object to including it as part of a scaled-down deal. Updated 5:51 p.m.: The Senate won't vote tonight and will reconvene at 11 a.m. tomorrow, Reid says. [View news story]
    there is some irony that if the Fed monetized debt, it would raise inflation which would also minimize the impact of the remaining debt. The only problem is that the trillions of dollars that have to be rolled over would go at much higher refinancing rates. That's what kills countries that think they can pull this off. Check with Greece.
    Dec 31 04:53 PM | Likes Like |Link to Comment
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139 Comments
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