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Dale Roberts  

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  • Is Vanguard Wellesley Income The Only Retirement Fund You Need? [View article]
    Great article, yes this is all one would need, or following the same approach with index ETF holdings. The sweet spot for retirees appears to be in that 40% to 70% stocks.

    Wellington or Wellesley do the trick.

    Easy stuff.

    Dale
    Mar 2, 2015. 08:37 AM | Likes Like |Link to Comment
  • The Oil Price Rubber Band Will Soon Snap Back [View article]
    Thanks Larry, not sure about the move higher but we'll see. There is a lot of oil that can be produced in that lower price range due to cap ex that is already spent. That goes for the oil sands and shale plays that is.

    But certainly over the next few years we'd have to guess that oil should go to a new range potentially well below $100 but above the $45-50 range. That said, we're about to find out how much oil they can produced in that lower band.

    And we have cost deflation for producers to consider.

    Dale
    Mar 2, 2015. 08:30 AM | Likes Like |Link to Comment
  • Stay The Course: See Income Compounding Results In The Early Years Of A Dividend Growth Strategy [View article]
    Staying the course is the most important part, no doubt.

    But why are you counting dividends that you don't need to spend for decades? Your success will be determined by the earnings of the companies you hold (entirely) as all dividends come from earnings.

    Dividend growth is a divining rod for earnings power and financially strong companies.

    And if you bought for a trade or two, that's not dividend growth investing. Success appears to be derived from longevity and patience.

    Dale
    Mar 2, 2015. 07:49 AM | 2 Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Yes, it is an important sector and should not be ignored, but perhaps should also not be looked upon as a wonderful opportunity at this stage.

    The major underperformed the market in times of high prices coming out of the recession, now we're in a lower price band.

    I also add to the majors on a regular basis through my indexes and I hold two Canadian energy / pipelines in TRP and ENB.

    Dale
    Mar 2, 2015. 07:40 AM | Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Thanks, they are certainly quite international in their production, do you know the breakdown of Brent to WTI for their sales?

    Dale
    Mar 2, 2015. 07:35 AM | Likes Like |Link to Comment
  • The Oil Price Rubber Band Will Soon Snap Back [View article]
    This might take a while. Everything is moving in one direction for the price of oil, for now.

    Dale
    Mar 2, 2015. 07:28 AM | Likes Like |Link to Comment
  • Buying LQD Is A Waste Of Time [View article]
    In my corporate bond funds I'm getting over 4% yield, I sprinkle in some high yields at over 6%, plus I hold a broad based bond fund in another portfolio.

    Some would say, from today, my rates of return for my bonds are beyond projections for U.S. and Canadian equity markets - but I hold those too as well.

    Never look at stocks or bonds in isolation. :)

    Dale
    Mar 2, 2015. 07:26 AM | Likes Like |Link to Comment
  • Buffett, Munger talk succession and more in annual letters [View news story]
    That said, BRK currently sits on its largest cash pile ever. Mr. B. may not watch price, but he certainly pays attention to valuations.

    Dale
    Mar 1, 2015. 08:42 AM | 4 Likes Like |Link to Comment
  • Buffett, Munger talk succession and more in annual letters [View news story]
    Here is his wonderful few paragraphs on risk, from the perspective of one with a long term horizon and one who is not worried about price volatility ...

    Stock prices will always be far more volatile than cash-equivalent holdings. Over the long term, however,
    currency-denominated instruments are riskier investments – far riskier investments – than widely-diversified stock
    portfolios that are bought over time and that are owned in a manner invoking only token fees and commissions. That
    lesson has not customarily been taught in business schools, where volatility is almost universally used as a proxy for
    risk. Though this pedagogic assumption makes for easy teaching, it is dead wrong: Volatility is far from
    synonymous with risk. Popular formulas that equate the two terms lead students, investors and CEOs astray.
    It is true, of course, that owning equities for a day or a week or a year is far riskier (in both nominal and
    purchasing-power terms) than leaving funds in cash-equivalents. That is relevant to certain investors – say,
    investment banks – whose viability can be threatened by declines in asset prices and which might be forced to sell
    securities during depressed markets. Additionally, any party that might have meaningful near-term needs for funds
    should keep appropriate sums in Treasuries or insured bank deposits.
    For the great majority of investors, however, who can – and should – invest with a multi-decade horizon,
    quotational declines are unimportant. Their focus should remain fixed on attaining significant gains in purchasing
    power over their investing lifetime. For them, a diversified equity portfolio, bought over time, will prove far less
    risky than dollar-based securities.

    Dale
    Mar 1, 2015. 08:41 AM | 3 Likes Like |Link to Comment
  • Buffett, Munger talk succession and more in annual letters [View news story]
    Price decline is risk for a typical investor - who as a group have a habit of selling when markets decline, and hence turning long term 10% equity returns available into 2% returns.

    Of course that volatility (risk) is managed by way of bonds in a balanced and rebalanced portfolio. Studies suggest most investors need a considerable amount of bonds.

    Most investors have a very very very low risk tolerance level as we'll see in the next market correction. Asset allocation is always in style.

    Dale
    Mar 1, 2015. 08:18 AM | 5 Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Oil still below $50 and bouncing around of course as storage vessels fill up. Storage is another factor.

    Dale
    Mar 1, 2015. 08:04 AM | Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Here's my article, Where will the price of oil settle?

    http://seekingalpha.co...

    It might help one take an 'educated' guess at where oil might settle over the next few years or several years. The game changers (oil sands and shale) have a considerable amount of production capability in the lower oil price range.

    They can reap the rewards of the great investments made in the last few years, and hold off on the more expensive projects, for now. And of course many predict we will have a period of cost deflation for oil producers helping to enable more production at a lower price band.

    Dale
    Mar 1, 2015. 08:03 AM | 1 Like Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Thanks F & G, I agree 100%, if that investor thinks that investment is a great investment within their time horizon.

    The oil price is the wild card here.

    And of course one should not abandon this important sector. One who is a stock picker might look for companies (or enough of them) that might have the potential for increased earnings in a lower oil price band.

    Are the major the obvious call in that regard? That's up to each individual investor to decide.

    I continue to add to the energy sector by way of my Canadian holdings, VIG and the S&P 500 at the index weightings, of course.

    Dale
    Mar 1, 2015. 07:57 AM | 2 Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Hi Rebel, but we have yet to see an earnings report in the lower oil price band.

    I think the majors are priced based on the expectation of a price rebound to $80-90 plus.

    How much will a CVX make in a $50 band? I don't know, I simply ask the question to address the risk. The next two to three quarters will be very interesting.

    Is one investing on the merits of majors having increased earnings in the $40-60 oil price range, or investing based on the hope that oil will go back to $80 plus?

    Dale
    Mar 1, 2015. 07:51 AM | 1 Like Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Chevron (NYSE:CVX) also released fourth quarter earnings and it also revealed a challenging quarter in this first inning of the new oil price paradigm. The company's fourth quarter earnings were $3.5 billion or $1.85 per diluted share. Fourth quarter 2014 earnings were approximately $1.5 billion lower than fourth quarter 2013 result. Earnings were trimmed by some 42% in a quarter that offered oil prices significantly above the recent range. And that was at $70 plus oil average for the quarter.

    What do your ratings look like if in the next quarter Chevron earns .60 and it might appear that they could earn under $3 per share in 2015. Do models even show it more attractive? The company does not appear to be well positioned for the new lower oil price paradigm.

    Dale
    Feb 28, 2015. 08:37 AM | 3 Likes Like |Link to Comment
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