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Bruce7b

Bruce7b
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  • 3 Costs Investors Must Control [View article]
    Rick: Good idea for an article but with mutual funds being mostly new to this site you might want to expand and explain in a little more detail. Most investors think commissions and related costs are included in the expense ratio--they are not. Look at the Morningstar breakdown of expenses into sub categories and you will see there is no item for commissions. So there are at least four costs investors should be aware of. You mention that "security law" requires that commissions be identified--I think you are wrong--if they were identified they would be included in the expense ratio. Another cost for some funds is the foreign tax withholding, which can be very important if a fund is held in an IRA/401k--since if paid it is lost and can't be recovered as it can be in a taxable account.
    Mar 29, 2015. 06:18 PM | Likes Like |Link to Comment
  • Investing In High Dividend Yield Stocks: A Sucker Bet? [View article]
    Willam: I guess I agree with Matthew below. It seems to me the author is making the case that high dividend yield stocks in this environment have been bid up (as have bonds) and therefore are risky. The fact that you have prospered in the runup doesn't say they are a good investment going forward. And if you looked at your after tax return you might have been better off with non dividend paying stocks. Wouldn't you want to know that as an investor? All I was saying about REITs, MLPs and BDCs (of which I own a fair number) is that they might distort his findings and if he focused totally on C-Corporation stocks it would be easier to digest his theory for those DGIs that love dividends regardless of the total return. I am guessing, just based on market cap, that most of the 50 stocks he is using are C-Corp so why not just clean it up?
    Mar 28, 2015. 03:20 PM | Likes Like |Link to Comment
  • Investing In High Dividend Yield Stocks: A Sucker Bet? [View article]
    Dr. Gray: It must be frustrating for you to write articles for this site. The DGI crowd tends to get very defensive if you question their philosophy. You note the suggestions that you are writing the article to "get clicks". These petty comments are not untypical of the DGI crowd--happens on a regular basis so don't take it personally.

    I do agree with some of the comments related to PE--if your 50 stocks include REITs, the PE for those stocks would seem to be meaningless in any comparison with C-Corporation stocks and would skew the results. Suggest you either tell the readers that there are no REITs included or revise the analysis to exclude them (as well as MLPs and BDCs).
    Mar 26, 2015. 09:24 AM | 2 Likes Like |Link to Comment
  • Why Everyone Is Wrong About Whole Foods Market (Again) [View article]
    You state "comparable sales have been in decline". Seems like what your chart shows is not that comparable sales have been declining but that the rate of growth of comparable sales has been declining. There is a big difference between those two statements. Comparable sales continue to grow--but at a 4-5% rate instead of 8-10%. On the surface if you can continue to grow comparable sales at a rate larger than inflation, even at a 4% level, while opening additional stores your business model is working. Not saying that those sales numbers justify the current PE but that is a different argument that you don't seem to be making.
    Mar 11, 2015. 07:41 AM | 7 Likes Like |Link to Comment
  • Vanguard ETF Vs. Index Fund [View article]
    Scott: The author makes that statement but the numbers he provided tell me a different story. Why give us tax efficiency numbers and then tell us what seems like a large benefit for the ETF is an edge for the index fund? And why tell us the ETF has lower expenses but bid/ask spread more than offsets them--which of course depends on how big the bid/ask spread is on your trades, how many times you buy and how long you hold. I would suggest that if you are a buy and hold investor that the difference in expenses will soon pay for any minor bid/ask spread (and all bonus for the ETF after that) and the tax savings will be there every year as long as you own the ETF (assuming it is in a taxable account). Not to mention the flexibility of being able to trade without waiting to after the market closes. If there is a case for the index fund I don't think the author has come close to making it.
    Feb 25, 2015. 01:29 PM | 3 Likes Like |Link to Comment
  • Vanguard ETF Vs. Index Fund [View article]
    I must be missing something. It looks like the ETF has the better tax efficiency (.48 to .61) and the lower expense (.15 to .18) so other than the bid/ask spread which you don't quantify, why are you selecting the index fund?
    Feb 24, 2015. 03:27 PM | 1 Like Like |Link to Comment
  • A Stock Picker Establishing An ETF Portfolio: My Plans For A Roth IRA [View article]
    Joseph: You better talk to Vanguard (or better yet any tax accountant) and they will tell you it does matter. It is you (not Vanguard) doing your taxes (see line 48 of 1040) that will generate a foreign tax credit in a taxable account. If the foreign etf is in a taxable account your 1099div will show the foreign tax paid by Vanguard related to your portion of the etf and you will get it returned as a credit. If the etf is in a roth account you will not qualify for the credit (no 1099div will be issued)--Vanguard will have paid the foreign tax (thus reducing your returns) but will be unable to pass it to you. You might as well learn how taxes impact your investments early on.
    Feb 11, 2015. 09:10 AM | 3 Likes Like |Link to Comment
  • A Stock Picker Establishing An ETF Portfolio: My Plans For A Roth IRA [View article]
    Joseph: Here's another way of looking at it. If you are getting a tax refund you aren't a "lucky soul"--instead you have been giving Uncle an interest free loan. Suggest you think it through and try to maximize what you owe in taxes come April 15, without paying a penalty. That way you have been getting the free loan. As to placing foreign based etfs in your Roth--same problem-- foreign governments are withholding taxes on the dividends on stocks in those etfs--if they are in a taxable account you can get those taxes back (avoiding double taxation). If you place them in the ROTH you are screwed. The purpose of a Roth is to avoid taxes and you have done the opposite. There are two things you, as an investor can control--taxes and expenses.
    Feb 10, 2015. 07:02 PM | 3 Likes Like |Link to Comment
  • Selling Stocks Is Like Football: Ohio State Coach Woody Hayes On Portfolio Management [View article]
    Three things can happen when you run the ball. You can fumble (bad); stopped for no gain or even a loss (bad) and a gain. Sounds like the odds are no better than passing. If that one yard pass hadn't been intercepted it would have gone unnoticed as far as flawed strategy goes.
    Feb 7, 2015. 11:11 AM | Likes Like |Link to Comment
  • Tiger Woods And Investment Gurus Lose Their 'Touch', Question: Do They Ever Get It Back? [View article]
    Elliott: Maybe it is just a wording issue but you make it sound like you think Peter Lynch "lost his touch". From what I know and what your figures show, he is one of the few who went out on top--at a fairly young age as I remember. Many great investors lose their touch when they either get old or they buy 150 foot yachts. Most golfers lose their touch when they get too old to compete. Was sad to see Ben Crenshaw in the opening "old farts" tourney two weeks ago shoot three rounds of 85 and I think he lost by 50 strokes. Makes you wonder why he is still out there and the same is true of many old mutual fund managers.
    Feb 4, 2015. 03:16 PM | Likes Like |Link to Comment
  • Closed End Funds: Where Does That Discount Go? [View article]
    Looking at performance numbers on Morningstar, the total return for ADX has underperformed the S&P 500 for 3, 5, 10 and 15 years. Regardless of the size of the discount and large distribution there doesn't seem to be a reason to own this fund--unless a case can be made that there is less risk when compared to the S&P 500. Just looks like an average fund with high expenses and those expenses are difficult to overcome.
    Jan 30, 2015. 03:50 PM | 2 Likes Like |Link to Comment
  • The Oil Sector Stock I Dream About Owning One Day [View article]
    Sherlock: You might be right about CLB but am pretty sure you are wrong about your phrase "once and a while"--think you mean "once in a while". Think about it smart guy.
    Jan 28, 2015. 07:53 PM | Likes Like |Link to Comment
  • When Picking Stocks, It's Good To Be Lucky. [View article]
    Robert: Here are my picks.
    CONSUMER DISC--CHILPOLTE (CMG), MCDONALDS (MCD)
    CONSUMER STAPLES---COLGATE (CL), KELLOGG (K)
    ENERGY---DIAMOND OFFSHORE (DO), CHEVRON (CVX)
    FINANCIALS--CINCINNATI FIN (CNF), MACHERICH (MAC)
    HEALTH CARE--GILEAD (GILD), JOHNSON&JOHNSON (JNJ)
    INDUSTRIALS--CATERPILLER (CAT), JOHN DEERE (DE)
    INFO TECH--FIRST SOLAR(SLR), IBM (IBM)
    MATERIALS--NUCOR (NUE), FREEPORT MAC (FCX)
    TELE SERVICES--WINDSTREAM (WIN), FRONTIER (FTR)
    UTILITIES---CENTERPOINT (CNP), ENTERGY (ETR)

    You can use my sign in name.

    Good luck with the contest.
    Jan 23, 2015. 01:31 PM | Likes Like |Link to Comment
  • When Picking Stocks, It's Good To Be Lucky. [View article]
    Robert: Sending a message is no longer easy at SA (they want a photo and bio). What would you think of me just including my 20 picks in a comment to this article?
    Jan 22, 2015. 11:45 AM | 1 Like Like |Link to Comment
  • Gilead Fires Back [View article]
    Lurker: I'm not following your logic. Anything is "conceivable" but why is it likely that Gilead will generate more revenue with lower prices and competition? Are you suggesting that insurance companies were going to disallow the use of sovaldi/harvoni in great numbers even though everything I have read says that the long term cost of not treating HEP C (liver transplants and long hospital stays) is greater than the cost of the Gilead drugs? And bringing the sales forward (not sure how that is going to happen) from future years--that might help 2015/16 sales but how can it do anything for the stock?

    Compare the situation today with six months ago--pre ABBEV approval, and it seems like both revenue and income will be less--maybe by a large amount, so unless the market was pricing in ABBEV success or the stock was just totally mispriced six months ago then it seems clear to me that the "future is not what it used to be".
    Jan 11, 2015. 08:32 AM | Likes Like |Link to Comment
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