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  • Apple Becoming A Good Speculation [View article]
    Sorry, but I disagree that the main driver of a stock price is the media. Yes, the media jumps on whatever bandwagon and as much as AAPL was loved on the way up, maybe it was bashed on the way down. But the media comes AFTER, it is not the CAUSE of the stock price movement - NO, I do not buy into the conspiracy-hype that hedge funds planned the whole thing (this is another opinion bandied about last fall by AAPL die-hards).

    I'm not saying media has NO effect, but money managers are not moving BILLIONS of dollars based on commentary from CNBC.

    AAPL missed expectations by a long shot - when the expected RATE of earnings changes so dramatically, the share price will follow. Yes, they still make a lot of money, but it is LESS than EXPECTED and LESS than last year. And more importantly, there is no reason to assume they will return to growth.

    AMZN and AAPL play in two different arenas based on their expected future domination - or lack thereof - in their space. Compare them at your own peril.
    Jul 31, 2013. 12:38 PM | Likes Like |Link to Comment
  • Apple Becoming A Good Speculation [View article]
    It doesn't matter what AAPL DID, how they did it in the past is no excuse. Samsung has smashed down the back door and they do not have the luxury of sitting around opining on how nice it was to have the time to create. The performance is only one metric - the CHANGE in that performance is what is so important to investors.

    AMZN has NOTHING to do with AAPL and comparing the two won't help you make any money.

    I wouldn't say much to Gundlach other than...ooops, you were right!!
    Jul 30, 2013. 11:49 AM | 4 Likes Like |Link to Comment
  • What If You Can't Live Off The Dividends? [View article]
    What did you use to time the market, and having gotten lucky during 2008, do you expect to be able to recognize the next downturn and obtain the same result?

    Selling "everything" is quite a risky proposition for most, especially those living off of the dividend income. I'm working on a strategy now for how to handle the next "crisis" but do you set a hard rule - at 20% down I sell everything - or do you just go by "gut" feeling to know when to cut your holdings? I worry about executing the sell decision and the re-buy decision perfectly enough to make it worthwhile.
    Jul 28, 2013. 01:41 PM | Likes Like |Link to Comment
  • What If You Can't Live Off The Dividends? [View article]
    One thing I haven't seen mentioned, that I employ, is a line of credit against my securities that has a very low interest rate and meant to used for life events, emergencies (basically anything BUT buying/holding securities). Morgan Stanley has this option, and it allows you to leave your investments in place, keep all of your money working for you, and the decision of when to sell is then always flexible.

    Note that I'm not talking about a margin account. You do need a relatively large account to get the best interest rate, but even the larger interest rates may be better than a forced sell. This line of credit does not require any payment ever, so some discipline is required. Conversely, you can pay it down/off whenever you want, no penalty.

    So, as far as keeping "18 months worth of cash" it would be completely unnecessary with the setup I have. For example, we bought a larger home in fall 2011, but instead of selling stock I accessed my credit line at 3.6% (another important point is that this credit line is "off the books" so it has no bearing on a mortgage, etc.), and this spring with the market up another 30% or so from the time we bought the house, I'm trimming shares to pay back the line of credit.

    Might not be right for everyone, but certainly has helped us.
    Jul 28, 2013. 01:33 PM | 6 Likes Like |Link to Comment
  • Ignore Apple Earnings [View article]
    A VERY important point lost in the writing is your statement, "This is considered a speculative investment..."

    Hopefully folks will keep that in mind if they choose to follow your lead.
    Jul 23, 2013. 01:23 PM | 1 Like Like |Link to Comment
  • Ignore Apple Earnings [View article]
    Didn't you get the memo that you're not allowed to say anything negative about AAPL?;)
    Jul 23, 2013. 01:21 PM | Likes Like |Link to Comment
  • Apple: Some Momentum Before Earnings [View article]
    ....and don't forget, you can lose nearly half of your investment in only 6 months for seemingly no reason.
    Jul 22, 2013. 11:59 PM | Likes Like |Link to Comment
  • Ignore Apple Earnings [View article]
    Selling calls every week sounds like trading to me...

    With a couple of minor tweaks, this same article could have been published last September when AAPL was cheap at $705 and going to $750 next week on its way to $900....
    Jul 22, 2013. 03:21 PM | 1 Like Like |Link to Comment
  • Coca-Cola Stock Is Not Quenching My Thirst [View article]
    I didn't see any factor related to the brand...having one of the most recognizable brands in the world should factor into your analysis IMO. Not completely sure how to value it myself, but leaving it out would be a mistake.
    Jul 22, 2013. 01:49 AM | Likes Like |Link to Comment
  • Protected Principal Retirement Strategy: Will Apple Ever Become A Dividend Portfolio Candidate? [View article]
    It's interesting to take a look at the high retail ownership of AAPL (compared to GOOG for example), the religious-like fervor of the commentary, and the schizophrenic price action of the stock and wonder....could there be a causal relationship here?

    You nailed it with the price action - if the investor is NOT seriously considering the possibility that AAPL could drop well into the $300s then they haven't learned the lesson yet I guess!

    One thing most of us know for sure is the information we receive and predictions for AAPL have been DEAD WRONG over the past year, so tuning into the same old sources and expecting them to be correct now makes me very wary. What source of information do I have NOW that I didn't have last October? None. Why should I listen to the same sources telling me now it's safe and AAPL can go nowhere but up?

    There is serious damage to this stock from this collapse - at this price I'm still long a medium-weight position, but if you give me $500 I'll cut it in half to reduce my risk. This belongs in the "spec" portion of your portfolio IMO, not in the body. If I'm ready to reduce my risk at that price, I wonder how many others feel the same?

    Only time will tell...
    Jul 20, 2013. 02:38 PM | Likes Like |Link to Comment
  • Protected Principal Retirement Strategy: Will Apple Ever Become A Dividend Portfolio Candidate? [View article]
    If you are confident that AAPL cannot fall bellow $350, have you considered writing bullish put spreads? You could do quite well - assuming you are right...but of course, you need to be "sure" that AAPL can maintain that base.

    I've been considering doing this myself, except for the fact that I clearly remember how AAPL bottomed at $505 and could never fall below $500 without the world collapsing...and then it did. And that information came from the same sources that now make me want to believe the bottom is, now, no wait, now. So, the future of AAPL remains elusive.
    Jul 16, 2013. 11:29 PM | Likes Like |Link to Comment
  • Protected Principal Retirement Strategy: Will Apple Ever Become A Dividend Portfolio Candidate? [View article]
    "Why?" Because it's AAPL and many people are very emotionally attached to this particular stock, so it hurts their feelings when you present a potential negative case like this;). Savvy investors know that loving your stock and defending it regardless of the truth is the real path to wealth! Oh wait, that's for raising your kids...oops.

    I'm very glad to see an article that treats AAPL like a stock instead of some privileged child. I didn't see any mention of buybacks though and I doubt they would allow the dividend yield to get that high, preferring to buy back shares instead. It sends a pretty strong message of "we're out of ideas and are done growing, so here's some yield to bribe you" when you get above 5%.

    If AAPL continues refreshing it's current line of products and conceding market share, i.e., continues what it's done since 2012 a stock price in the $300 - $400 range is completely plausible. I could see AAPL more as a dividend growth story than as a high-yielder.

    You make another important point that folks overlook, and that is AAPL will sell off when the market sells off, so if you see AAPL at $500 this September, you'll need the broad market to continue its march upward also (and it very well may do so).
    Jul 16, 2013. 10:28 PM | 2 Likes Like |Link to Comment
  • Apple Third Quarter Earnings May Put You To Sleep [View article]
    I certainly hope you are right, but it's a simple fact that many people who could have bought the iPhone did NOT and chose Samsung instead, so blaming the world economy should be crossed off your list. I expect AAPL to take share, not lose it.

    While you've been sitting in AAPL waiting to get rich, the rest of the market has been taking off - if you expect AAPL to go up, you should be expecting the market to continue upward also (personally I do think the market goes higher, so this might be fine). Meanwhile, investor perception seems to have turned such that the loss of Steve Jobs really could mean the end of AAPL as an innovation company - meaning you are going to need an amazing breakthrough to get out from under this shadow and change investor perception.

    An important question to ask is if all of the kids and celebs who think AAPL is cool right now still will in 10 years with the obvious increase in competition. Every kid I know (and I have two in grade school) has an iPad - NOT a tablet, but an iPad. I could argue that this means there is a whole new generation of AAPL lovers growing up, but they could just as quickly want to ditch anything AAPL and move on, i.e., outgrow AAPL.

    Nobody knows...just like the crash from $705 that nobody saw coming - and continuing, no less - where AAPL goes from here is really speculative IMO. I hold a medium-sized long position, based mostly on their ability to return cash and grow the dividend.
    Jul 15, 2013. 11:27 AM | 2 Likes Like |Link to Comment
  • My Dividend Portfolio: Q2 2013 Update [View article]
    Puts and Calls would help you spend a lot of your dividend income while allowing you to brag that you "hedge" and "trade options" like a "savvy investor." If you want to make money over the long-run, leaving them to others who like to guess short-term price and time-frame is the smart thing to other words you're doing the right thing by avoiding them.

    Even the "safest" option play, such as that mentioned by harborclubrat has its risks. Sounds great to sell a put and collect premium, but on these types of stocks you rarely get the volatility to make it worthwhile. So, you sell a couple puts and collect $200 for the next couple months, but meanwhile the stock climbs slowly higher so you never do get to own it and participate in the rising dividends and other good news. Conversely, you sell the puts, keeping all the cash to back them on the sidelines, and a bad piece of news comes out that knocks the stock down 5%, but your put was nearly ATM so you're stuck buying them way above the market price - think JPM when it dropped from $42 to $33; you would have had the pleasure of paying $41 or so. There are situations where this makes sense, e.g., if you don't watch the market and you are ready to put a limit order in GTC and see if you get the stock (or not), then you might as well get paid via selling the put. This is about the "safest" way to use options...and it is far from "safe" IMHO.

    Another way that's touted is by selling covered calls - this is a good way to significantly limit your upside while generating big commissions for your broker, unless you can regularly and precisely call market tops (there are people who think they can). There are plenty of funds who use this strategy and they've been able to lose half of their assets - permanently - over the past ten years (but hey, they generate nice yield, yay). I'd like to grow my assets instead of losing them (having them called away below their value).

    I see too many people extoling the virtues of options and not enough commentary about their true risks, which are much greater than the ads (and offerings of "workshops") from your brokerage would lead you to believe. If you could significantly juice returns with options over long periods of time, there would be a well-known fund doing so by now. Instead there are only well-known funds doing this poorly which should be a warning to the individual investor.
    Jul 15, 2013. 10:39 AM | 2 Likes Like |Link to Comment
  • Apple Third Quarter Earnings May Put You To Sleep [View article]
    Good thing I was at the beach today, because it was hot! Keep this in mind when considering AAPL's quarter.
    Jul 15, 2013. 12:08 AM | 1 Like Like |Link to Comment