How to Invest ?

[SaucySailoress]

Originally Posted by spiritbaer

Why would anyone come on a sailing forum to seek financial advice?

A 'welcome' thread in the Meets & Greets forum asked whether to sell up before sailing and grab the cash, or keep the property and ensuing ties to land. My problem is that I have cash - but think property might make more sense. BUT, I am afraid of ties!!

I started this thread because I really don't want to tuck my cash under the pillow. Whilst it might be safer there than in the bank; if I do that then the boat is bound to sink. Murphy dedicated his law to me.

I'm simply seeking ideas, and trying to ascertain what has worked for other cruisers.

Originally Posted by spiritbaer

Anything that is guaranteed on paper will only be good for butt wipe,since inflation will make it prohibitively expensive to afford the real stuff.

That includes printed bank notes, I suppose. That's one of the best ideas I've seen so far.

[denverd0n]

Originally Posted by Delfin

Hmmm....The S&P has returned an average of 3.38% over the last 10 years, while gold has returned 400% and silver 600%.

And the last ten years has been extremely a-typical for both the S&P and for gold and silver. Why don't we compare the S&P to gold and silver for the PREVIOUS ten years?

Oh, I know why, because the results would be almost exactly opposite!

[denverd0n]

Originally Posted by Mike Sibley

As a recently retired finance professor...

Saucy Sailoress, go back and re-read this post! It is worth a lot more than the 2 cents value that Mike put on it!

I'm not a "recently retired finance professor," but I have spent more than 15 years working in the financial industry, about 10 of that at one of the largest mutual fund companies in the U.S. I can assure you that the guys who make tens of millions of dollars every year managing other people's money will not give you any better advice than Mike did.

[James S]

Originally Posted by avb3

Careful with foreign denominated investments as now your playing the ups and downs of a volatile currency market.

As a Canadian, I am avoiding most U.S. based investments (there are some great real estate plays that have emerged, however).

The U.S. deficit will impact the U. S. dollar negatively over the long term, and until the citizens come to an agreement that they really want deficits and national debt eliminated, it will continue to decline.

Canada faced the same problem and would be in the same boat had not virtually all political parties on the left and right listened to the Canadian people back in the mid- 1990's wish to eliminate the deficit.

As a result, Canada is in the best shape of any of the OECD or G8 countries.

The BUT is that the citizens of the country need to want it, and I don't sense that being a general perspective yet in the U.S.

My honest opinion only.

The lira is pegged to the US$...1 = 1,500

[avb3]

Originally Posted by James S

The lira is pegged to the US$...1 = 1,500

That changes things as far as currency fluctuations. Of course, who knows if that will remain, but seeing it's been that way for a number of years (I was not previously aware of this), it may have a spot in someone's portfolio.

There are investment grade bonds I have purchased within the last 6 months getting between 5.5 and 6 % (Canadian denominated). Only proviso there is one needs to hold on until maturity, otherwise one can get whipsawed on sale of bonds themselves.

A good laddering strategy helps, within a well balanced and diversified portfolio, that includes equities.

[Zonker]

May be something to watch especially for USD based investment - equities and commodities might raise because USD is losing value. The investment looks like going up, but the effective value might be same or even go lower.

[70AMX]

The People’s Bank of China(PBOC) recommended March 25 that 1 billion Chinese consider buying gold as a hedge against inflation and to preserve values in a world where currencies can fall. (what happens to the price of Gold if only 1% listens?)
Goldman Sachs (I hate those guys) estimate for gold 6 months is $1565 and 12 months $1690
The great Richard Russell calls gold "the great stealth bull market"
Alf Fields, the Aden sisters, Martin Armstrong, Peter Schiff, Gerald Celente, Jim Sinclair... These economists all predicted the 2007/8 collapse well before it happened and if you read them today....they all recommended Gold AND still do.


"Really? I would love to watch you anchor off Krabi, Thailand and dinghy into town to buy some groceries with those gold coins.

Have you ever done such a thing in a remote area or did you just read about this on the internet somewhere? "

As far as using gold in Thailand, you do realize just as you need to do your homework to find a bank to convert dollars into the local currency... you need to do your due diligence in finding where to convert gold into the local currency too.
Yes I have bought and sold or traded Gold In Cr and Panama....its not that hard to find a place that deals in Gold, but in Costa Rica it might be hard to spend a US $100 dollar bill or even a $20 with a rip or tear (personal experience)

[Jack Tar]

I have to agree with the rental theory. Apartments as in a lot of them isn't the answer for many because the initial investment is huge. There is however another way. Purchase a triplex or even bigger. An already existing unit with tenants is best. Use one unit for yourself and let the other tenants pay your loan off. People have to live somewhere. The largest requirement here would be people skills.

[Jack Tar]

Oh almost forgot: Gold isn't the big money maker of metals that it use to be. Look at silver or even very pure lead.

[70AMX]

Originally Posted by Jack Tar

Oh almost forgot: Gold isn't the big money maker of metals that it use to be. Look at silver or even very pure lead.

Silver has been the better performer of the two.....but it is much more volatile...and just try moving 100k in silver. Heavy and bulky... Gold is easily transportable.... just ask the prior ruler of Tunisia....he reportedly stole 1.5 tons of Gold when he left.

[Zonker]

Guys ... really - forget gold - if old mom and pop are talking about a certain "investment", it's time for the smart money to get out. Central banks (and may be the FED too) around the world will start increase interest rate ... then watch how fast gold can drop - and that may be overnight if the "normal" investor can't sell.

[Wainui]

Invest Simple with Lazy Portfolios - MarketWatch.com

Vanguard funds all index linked and well balanced.
I use the Aronson Portfolio.

[Khagan1227]

I'm currently into REITs, specifically ANH, GRT and CUZ. ANH is giving me a return of over 12%, but I watch it like a hawk and can and have bailed when it worries me. I do my own research, so I only follow 4 - 10 stocks. To be honest I have less than 10% of my portfolio in REITs, the remained is mutual funds and stocks.

I also sell covered calls on a few of my other stocks and make some off of those. Since I only will sell a call with an expiration of a month or less, the profit is small, but the income is steady.

A good friend of mine trades options, and while the risk is way too much for me, I like his method of picking stocks for his own personal portfolio, find a stock, look up it's growth rate over the last year, subtract the P/E ratio. If the result is negative, move on, positive, do more research.

In these economic times, there are no get rich quick deals, slow and steady, make sure you are comfortable with the risk.

[70AMX]

The fed can't raise rates without the interest on our debts going exponential.
How many people do you know that have invested in PM's? 50%? 25% or ZERO%
The gold in a bubble theory has been raised time and time again...the average investor holds no gold, so until the average investor is a believer and investor in gold...no bubble can be seen on the horizon.

[Zonker]

FED ... last Friday there were some talks abt funds rate might raised up to 2.5% this year, I guess if nothing will be done inflation will spike and USD goes down like Zimbabwe Dollar.

Gold ... there is no real industrial demand, it's all speculation and as soon there are other meaningful ways to preserve/generate income (such as interest) gold will crash. Also be aware that world largest speculators are playing there and history told they DID always make huge gains. Questions is who were the others who lost big. Just wait until interest rates go up and invest in some "safe" products.