Articles by Steve Selengut on ArticleSnatch.com

Making A Volatile Stock Market Your Very Best Friend

Tue, 30 Aug 2011 14:14:29 -0400

Most people never forget their first love. I'll never forget my first trading profit --- but the 600 1970 dollars I pocketed on Royal Dutch Petroleum was not nearly as significant as the conceptual realization it signaled. I was amazed that someone would pay me that much more for my stock than the newspaper said it was worth just weeks ago. What had changed? What had happened to make the stock go up, and why had it been down in the first place? Without ever needing to know the answers, I've been trading RDSA for over 40 years! Looking at scores of similarly profitable, high quality companies in this manner, you would find that: 1) most move up and down regularly (if not predictably) with an upward long-term bias, and 2) that there is little if any similarity in the timing of the movements between the stocks themselves. This is the "volatility" that most people fear and that Wall Street loves them to fear. It can be narrowly confined to certain sectors, or much broader, encompassing practically everything. The broader it becomes, the more likely it is to be categorized as either a rally or a correction. **End Summary** Topics: Volatility]]> Stock Market]]> Modern Portfolio Theory]]> MPT]]> MCIM]]> Wall Street]]> investing]]> correction]]> rally]]> ]]> About the Author: ]]> Steve Selengut Author of "The Brainwashing of the American Investor: The Book That Wall Street Does Not Want You To Read" http://marketcycleinvestmentmanagement.com

A More Refined Equity Selection Universe Breeds Superior Performance

Mon, 25 Apr 2011 14:14:02 -0400

How much financial bloodshed is necessary before we realize that there is no safe and easy shortcut to investment success? When do we learn that most of our mistakes involve our very own greed, fear, and unrealistic expectations? Eventually, successful investors begin to allocate assets in a goal directed manner by adopting a realistic investment methodology --- an ongoing security selection and monitoring process that is guided by realistic expectations, selection rules, and management guidelines. If you are thinking of trying a strategy for a year or so to see if it works, you're due for a smack up alongside the head. Viable strategies transcend cycles, not years, and viable equity strategies consider three or four disciplined activities, the first of which is selection. Most strategies ignore one or more of the others. How should an investor determine what stocks to buy, and when to buy them? Will Rogers summed it up: "Only buy stocks that go up. If they aren't going to go up, don't buy them." Many have misread this tongue-in-cheek observation and joined the "buy anything that is rising" club. I've found that the "buy investment grade value stocks lower" approach works better. **End Summary** Topics: Value]]> stock]]> investing]]> equity]]> selection]]> worksheet]]> investment]]> portfolio]]> financial]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Wall Street Most Wanted: A New Blue Chip Market Indicator

Tue, 12 Apr 2011 15:11:15 -0400

The Dow, Investment Grade Value Stocks, and Alternative Investments There are two extremely good reasons why your portfolio may not be "performing" (whatever that means) either as well as you would like or as well as your buddies say that they have been doing. But let's define our terms before digging any deeper. None of you have done as well in the equity market as investment grade value stock investors. Most of the time, investors are content to observe the steady growth of their portfolio, as income and (unrealized) market value gains add to their ego-friendly asset base --- this while the ebb and flow of the markets remains in a relatively boring "trading range". They can see the steady progress being made toward the goals that they established for their portfolios. Long-term-successful investment portfolios must have both reasonable goals and a plan for moving in their direction. For them, performance is a measure of this movement toward objectives and it is generally considered a long-term, personal proposition. Income securities are expected only to produce dependable income, and equities are expected to produce growth in the form of realized capital gains. **End Summary** Topics: Dow]]> DJIA]]> S P]]> IGVSI]]> MCIM]]> alternative investment]]> investor]]> stock market]]> Wall Street]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com http://www.valuestockindex.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

High Dividend ETFs - An Equity-Income Investment Fantasy

Thu, 24 Mar 2011 08:52:55 -0400

Where's the beef? Where's the high income? Who are they trying to kid? A week or two ago, while exchanging ideas at an AAII chapter meeting somewhere in the Northeast, a comparison was made between a professionally directed "Market Cycle Investment Management" (MCIM) portfolio and any of several "High Dividend Select" equity ETFs. Many years ago, I raised the question (to no one in particular): what's better for your financial health, 6% tax free/tax deferred or 3%? There is absolutely not one molecule of similarity between any MCIM portfolio and any Index ETF, period. You decide which is best for you. I took a closer-than-I-normally-would-bother-to look at three different equity ETFs in the "high dividend equity" category: PFM, FDL, and VIG. They had almost everything in common, except their Morningstar rating, which varied from two-star to five-star. Interestingly, the five-star rated fund seemed to be the most speculative. Each was constructed, or "marked-to", the weighting of the securities in a specific index, such as the "Dividend Achievers Select Index". These indices are comprised of mostly large capitalization US companies with a history of regular dividend increases. **End Summary** Topics: ETF]]> CEF]]> mutual]]> fund]]> dividend]]> achievers]]> MCIM]]> market]]> cycle]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com http://www.valuestockindex.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Investment Guru Interview - Money Matters Radio

Fri, 11 Mar 2011 09:46:10 -0500

Stu Taylor's Twenty Questions of Professional Investor Steve Selengut For nearly ten years now, Stu Taylor and I have been entertaining audiences throughout the country with a Q & A format program that consistently draws an hour full of interesting (and sometimes off-the-wall) investment questions. We have never, ever, gotten very far into the script --- thought you might be interested. ONE - Steve, you've managed investment portfolios for about 40 years. What are the three biggest mistakes that people make? : They don't have a clear cut plan or a clear idea of what to expect from investment securities and markets. : They get stuck in the fear and greed emotional cycle, always buying high and selling low. : They rely on gimmicks, software programs, and predictions, ignore cyclical realities, and choke performance with unrealistic time constraints. : They ignore the income generating portion of their portfolio --- the list is really much longer than just three. TWO - OK, and just what is reality? : Markets, the economy, and interest rates are cyclical entities. Their movements do not correspond with calendar time periods. **End Summary** Topics: Stock Market]]> Cycle]]> Investment Management]]> Business cycle]]> interest rates]]> Wall Street]]> investors]]> advisors]]> market gurus]]> ]]> About the Author: ]]> Steve Selengut http://marketcycleinvestmentmanagement.com http://kiawahgolfinvestmentseminars.net Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

How Much Longer Can This Wall Street Toga Party Last?

Tue, 08 Mar 2011 09:45:03 -0500

About a year ago this week, just before the one-year anniversary of this market rally, there were about 45 IGVSs priced 15% or more below their 52-week highs. The market seemed to be entering a corrective phase, but it just never happened. A year later, the market statistics, all of them, are shouting at the top of their lungs --- the correction is coming! The correction is coming! Portfolio "smart cash" is at pocket-hole-burning levels; less than 3% of all IGVSI stocks are even close to "bargain" prices; new 52-week highs have more than quintupled new lows; and issue breadth has been exceptionally positive. Those of you who are "in the know" will recognize "smart cash" as the type that is created by targeted profit taking plus dividend and interest income. It reflects an Investment Grade Value Stock Index (IGVSI) that has surpassed its pre-financial crisis record high --- in spite of the fact that all the other averages remain below theirs. Most (equity heavy) Market Cycle Investment Management (MCIM) program portfolios are at all time high profit levels; **End Summary** Topics: MCIM]]> market cycle]]> IGVSI]]> investment]]> performance]]> grade]]> bargain stock]]> monitor]]> value stocks]]> ]]> About the Author: ]]> Steve Selengut http://kiawahgolfinvestmentseminars.net http://www.marketcycleinvestmentmanagement.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

The Dow Jones Industrials --- A Blue Chip Average No More

Thu, 24 Feb 2011 09:40:46 -0500

In addition to a well thought out investment plan, successful equity investing requires a feel for what is going on in the real world we refer to as "the market". To most investors, the DJIA provides all of the information they think they need, and they worship it mindlessly --- thinking it has mystical predictive and analytic powers far beyond the scope of any other market number. A cursory review of New York Stock Exchange (NYSE) "issue breadth" figures (90% of the Dow stocks are traded there) shows how the Dow has not been prescient or historically accurate with regard to broad market movements for the past twelve years. Additionally, this financial icon that investors revere as the ultimate "blue chip" market indicator has lost its luster. Only 40% of DJIA companies claim an A or better S & P rating, 20% of the issues are ranked below investment grade --- and this after recently (and quietly) dumping AIG, C, GM, and HON. Has the long-in-the-tooth DJIA grown impotent? Hasn't it really become a mini-S & P 500? **End Summary** Topics: Dow]]> DJIA]]> average]]> investor]]> stock market]]> Wall Street]]> bonds]]> income]]> asset allocation]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com http://www.valuestockindex.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Income Investing Articles --- An Anthology

Wed, 19 Jan 2011 12:22:05 -0500

After forty years of investing, a few things become clear: you need to focus on quality securities, diversify properly, and develop a lifetime supply of income. The investment puzzle becomes easier to solve if you have a handle on all the pieces. But income portfolio management is a puzzle in its own right, and the major problem is focus --- income is king. Here's a collection of ten articles that will help you solve the income puzzle: http://kiawahgolfinvestmentseminars.net/Inv/index.cfm/18374 Income Investing Made Easy - Parts One & Two - In time, you'll learn to beam with pride as your diversified group of high-quality income earners moves lower in price with higher interest rates. Finally, it's time to increase portfolio yield and reduce cost basis --- at the very same time! Managed Closed End Funds --- Solid Income Investments in Liquid Form - It should become abundantly clear that this form of investment has eliminated nearly all of the drawbacks of conventional mutual funds. The two have very little in common. Income Investing: Selecting the Right Stuff - Parts One & Two - When is 3 percent better than 6 percent? **End Summary** Topics: Total return]]> compound stock earnings]]> income investing.real estate]]> REITs]]> CEFs]]> MLP]]> closed end funds]]> MCIM]]> retirement]]> ]]> About the Author: ]]> Steve Selengut http://marketcyclemanagement.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

Need A GPS For Your Investment Portfolio?

Wed, 19 Jan 2011 12:20:34 -0500

"Hey 'Deep Pockets', what were you doing on October 19th, 1987", the Wall Street Jungle reporter asked? I was gritting my teeth, shaking more than just a little, palms sweaty but placing dozens of individual orders for the best NYSE, dividend-paying, companies --- at prices that nearly everyone thought would drop even further. Looking around the room, I seemed to be the only one in the office that was actually buying! The other brokers were fielding phone calls from frightened clients. Sell! Sell! Sell! The crash of '87 was the first significant test of an investment methodology developed in 1970 by an RIA client of mine. Two months earlier, many of his investment management clients were wondering why he had sold practically everything, and was sitting on mountains of what he called "smart cash" --- whatever that meant. Now they knew, but why were they so quiet? Their cash was completely invested, the media was predicting the end of the world --- my phone was the only one not ringing! The investment manager had one call from a client that day --- the guy wanted to know how many calls he had received. **End Summary** Topics: GPS]]> MCIM]]> market cycle]]> investment]]> management]]> RIA]]> crash]]> black friday]]> WSJ]]> ]]> About the Author: ]]> Steve Selengut http://marketcycleinvestmentmanagement.com http://valuestockindex.com/ Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

Income Security Prices Tank: What, Me Worry!

Mon, 13 Dec 2010 08:23:03 -0500

Whoa! Stop! Hang on a minute. There is absolutely nothing unusual going on in the income securities markets. There is nothing to be particularly concerned about or afraid of. Relax, take a few deep breaths, and read on. Falling income security prices are all the buzz in the financial media these days, but why does this translate into such fear and confusion? I saw a news report the other day that encouraged investors to abandon their income ship and sail away on a stock market steamer that has been cruising steadily higher for twenty months --- the IGVSI equaled its September 2007 high on December 8th. And lest we forget, the over-riding purpose of investing in income securities is, after all, the generation of income. That's income, Alice, not growth in market value. Just income. Income securities, as measured by an index of high quality closed end funds (CEFs), remain roughly 50% above where they were at the bottom of the financial crisis and, more importantly, precisely within their normal price range of the past ten years. The most conservative CEFs are yielding from 6% tax-free to 8% taxable. **End Summary** Topics: income investing]]> CEF]]> media]]> securities]]> fixed]]> equities]]> Wall Street]]> markets]]> interest]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

MCIM Portfolios Rally To Three-Year High Levels

Mon, 13 Dec 2010 08:21:19 -0500

KIAWAH ISLAND, SC, December 13, 2010 Kiawah Golf Investment Seminars (an investment education enterprise located near the Kiawah Island Golf-Tennis-Beach resort) proudly reports estimated investment performance results for a sampling of Market Cycle Investment Management (MCIM) portfolios. Thus far in 2010, MCIM (70% Equity vs. 30% Income) portfolios are up roughly 16%. This gain, on top of "dismal decade" growth estimated at 85%, further strengthens the methodology's reputation as the safe and conservative approach to steady growth of both wealth and retirement income. Kiawah Golf Investment Seminars is the only entity in the world authorized to teach the Market Cycle Investment Management methodology. From the end of 1999 through the end of 2009, all of the popular Wall Street market performance measurement tools were in the red. Because of their emphasis on dividend paying, Investment Grade Value Stocks, and a solid base of income producing Closed End Funds, Market Cycle Investment Management portfolios were up an estimated 85%. Both the S & P 500 and the Dow Jones Industrial Average were negative from 1999 through 2009. From the recent financial crisis beginning in 2007, through the interim "peak" on December 10 2010, most MCIM portfolios have regained positive territory. **End Summary** Topics: Kiawah resort]]> golf]]> steve selengut]]> investment]]> seminar]]> retirement]]> income]]> asset protection]]> allocation]]> ]]> About the Author: ]]> Steve Selengut Kiawah Golf Investment Seminars http://kiawahgolfinvestmentseminars.net

Stock Selection - Tools and Rules

Tue, 07 Dec 2010 14:26:03 -0500

At least ten hands shoot into the air as the discussion turns to stock selection. The speaker smiles, responds to each, and observes: "You really need to know the depth of the water, its temperature, tides, and currents before you dive into the river --- and then, what kind of predators are in there?" Flying low over coastal South Carolina, I'm probably the only person on the plane who sees the meandering rivers and tidal creeks as a history of stock market cycles. How does one navigate these complex connections without getting lost, running aground, or being attacked by alligators? How does one select equity securities in a manner that consistently avoids the risks of volatile markets, fickle investors, abusive regulators, regressive tax codes, and brainwashed investment gurus? Along with self-confidence and experience, it takes some management skills that most investors fail to sharpen before they launch their boat --- planning, organizing, and controlling. Here's an overview, and it is expected to provide structure and provoke thinking while skimming over most of the detail and explanation that can be found in the "Brainwashing" book. **End Summary** Topics: stock market]]> securities]]> trading]]> volatility]]> selection universe]]> investors]]> regulators]]> tax]]> plan]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

How to Minimize Investment Risk

Wed, 25 Aug 2010 13:51:48 -0400

In the recent financial crisis, a very small percentage of (I-bought-my-home-to-live-in) mortgagors stopped making their payments. Still, the hysteria over the bursting housing bubble (i.e., lower market values) led to financial institution road-kill because of ridiculous accounting rules. When the dot-come bubble destroyed "new economy" gladiators in a gory spectacle destined to repeat itself over time, what investment portfolios cheered unscathed from the coliseum bleachers? If you reduce the amount of betting in your portfolio (and throw out politicians who don't have a clue about the workings of free markets) you can safely navigate even the choppiest seas that the market, interest rate, and economic cycles roll your way. The tide-like change of market values is the normal order of things, and until we embrace the cyclical nature of markets, all markets, our disappointment and disillusionment will continue. Portfolio market values will reflect where we are within the various cycles --- there are no "up only" assets. Interest rate sensitive securities (all bonds, government securities, preferred stocks, and relatively high dividend equities) vary inversely with interest rate expectations, most of the time. **End Summary** Topics: Risk]]> asset allocation]]> investment]]> stock market]]> financials]]> money]]> asset allocation]]> market value]]> profits]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com/ Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Basics of Investing: Cruise Control Hedging

Thu, 12 Aug 2010 08:45:06 -0400

Most people enter the investment arena thinking that "Risk" is a board game they played in college. Today, I would guess that the majority of investors have never owned an individual share of common stock or a Municipal Bond. The popularity of investment products has heightened the risk for all investors and has indirectly led to many of the policy errors that threaten both capitalism and the economic fabric of America. Individual equity market prices are increasingly and inappropriately influenced by decision-making based only on the derivatives that contain them. Few people consider the investment risk associated with public policy decisions. Product investors and derivative speculators participate in less personal markets, where it is more difficult to connect the dots between their personal financial interests and their political alignments. So in a very real sense, investors have to deal with public policy risk every bit as much as they need to analyze the risks associated with the securities and other financial products they hold in their portfolios --- complicated, but it is doable. Apart from these important peripheral considerations, the risk of loss in any equity investment is generally greater than the risk of loss in any debt related instrument. **End Summary** Topics: Risk]]> asset allocation]]> investment]]> stock market]]> financials]]> money]]> asset allocation]]> market value]]> profits]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com/ Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Risk, The Essence Of Investing

Thu, 12 Aug 2010 08:43:07 -0400

Most investors incorrectly think of "risk" as the possibility that the market value of a financial asset might fall below the amount that he or she has invested in the asset. OMG, how could this be happening! Think about it. The harboring of these misconceptions (that lower market price = loss or bad and/or that higher market price = profit or good) is the greatest risk creator of all. It invariably causes inappropriate actions within the large mass of individuals who are uninitiated in the ways of the investment gods. Risk is the reality of financial assets and financial markets: the current value of all securities will change, from "real" property through time-restrained futures speculations. Anything that is "marketable" is subject to changes in market value. It is as the gods intended, and portfolios can be designed so that it just doesn't matter quite so much as you've been brainwashed into thinking. What is abnormal is the hype surrounding market value changes and the hysteria such hype causes among investors. No way should a weak real estate market translate into near zero bank balance sheet entries --- it just doesn't compute, except when it is popular politics. **End Summary** Topics: Risk]]> asset allocation]]> investment]]> stock market]]> financials]]> money]]> asset allocation]]> market value]]> profits]]> ]]> About the Author: ]]> Steve Selengut http://www.marketcycleinvestmentmanagement.com/ Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Hedging Your Investments 1-2-3

Thu, 15 Jul 2010 09:22:59 -0400

The first page of search engine research tells you that: "Investors use hedging strategies when they are unsure of what the market will do"--- isn't that always? Further along you learn that there are many different kinds of strategies, nearly all of which rely upon some sort of derivative betting mechanism. But what is hedging all about in the first place? Conspiracy theorists have their hands in the air. What's that? Portfolio hedging strategies were created to expand the market for the first generation of derivative products--- options and futures contracts. Hmmm, not so far fetched an idea, really. Just back up a bit and think about what they are trying to accomplish. Hedges are designed to massage your market value numbers, a kind of security blanket that softens the highs and lows of the market cycle. But why focus on the fluff of transient market values in the first place; cycles eventually correct themselves without the unnecessary drama, guesswork, risk, and trading fees. It's not the market value of the portfolio that is of primary importance. It's the actual content of the portfolio and how you deal with the natural dynamics of the securities you own. **End Summary** Topics: Hedge fund]]> hedging]]> market]]> stocks]]> bonds]]> money]]> Wall Street]]> profits]]> income]]> ]]> About the Author: ]]> Steve Selengut http://www.kiawahgolfinvestmentseminars.com/ http://www.sancoservices.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

Managed CEFs --- Solid Income Investments in Liquid Form

Mon, 14 Jun 2010 14:00:51 -0400

A Closed End Fund (CEF) is a publicly traded investment company that invests in a variety of securities such as stocks, bonds, preferred stocks, real estate, mortgages, oil and gas royalties, etc. The variety of sectors, classifications, and geographical representation is every bit as confusing as it is with traditional funds, but the advantages are easy to understand. Capital is raised by an Investment Company through an initial public offering (IPO) of common stock and the proceeds are invested according to the investment objectives of the fund. Like a traditional (open end) mutual fund, a Closed End Fund has a board of directors, appoints an investment advisor and employs a portfolio manager. Unlike conventional mutual funds, CEFs do not issue and redeem shares directly with investors at net asset value. CEFs are listed on national securities exchanges, where shares of the Investment Company are purchased and sold in transactions with other investors, just like individual company stocks, and most often not at net asset value. Many Brokerage Firm Statements will list these securities as Equities or Mutual Funds, not quite in sync with the purpose or nature of the securities contained within. **End Summary** Topics: CEF]]> ETF]]> closed-end fund]]> mutual]]> NYSE]]> investment]]> income]]> retirement]]> asset allocation]]> ]]> About the Author: ]]> Steve Selengut http://www.kiawahgolfinvestmentseminars.com/ http://www.sancoservices.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read"

The Investor's Creed --- A Much More Practical Approach

Thu, 27 May 2010 13:53:56 -0400

Fascinating, isn't it, this stock market of ours, with its unpredictability, promise, and unscripted daily drama. But individual investors are even more interesting. We've become the product of a media driven culture that must have reasons, predictability, blame, scapegoats, and even that four-letter word, certainty. We are a culture of investors where hindsight is rapidly replacing the reality-based foresight that once was flowing in our now real-time veins --- just like in basketball, golf, and football. The Stock Market is a dynamic place where investors can consistently make reasonable returns on their working capital if they comply with the basic principles of the endeavor AND if they don't measure their progress too frequently with irrelevant measuring devices. The classic investment strategy is so simple and so trite that most investors dismiss it routinely and move on in their search for the holy investment grail(s): a stock market that only rises and a bond market capable of paying higher interest rates at stable or higher prices --- just not going to happen. This is mythology, not investing. **End Summary** Topics: Investment Strategy]]> Investor's Creed]]> Smart Cash]]> stocks]]> markets]]> Wall Street]]> asset allocation]]> investments]]> Steve Selengut]]> ]]> About the Author: ]]> Steve Selengut http://www.sancoservices.com Professional Investment Manager since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Income Investing And What You Really Know About It - Survey Results

Wed, 17 Feb 2010 14:02:00 -0500

The results are in! Roughly 260 people took the time to respond to the first income investing survey and I thank y'all very much for being so generous with your time. First, the generalizations: As you will recall, the survey included eight "mostly true" or "mostly false" statements. Most people answered all of the questions without explanation or analysis (as requested), and most of the analysis explained exceptions to the "in general" nature of the questions being asked. All of your comments were well thought out, most were right on target and much appreciated. Unanswered questions were judged half right and half wrong because there were too many of them to label totally wrong and wind up with meaningful statistics. Still, as a class, those who responded barely achieved a passing grade. A composite grade of just 72% correct is pretty scary. Only 20 people assessed all eight statements correctly. Here are the individual item results, based on my forty years of investment experience, including 35 managing OPM (other people's money) professionally. 1. Tax deferred income is better than tax-free income. This turned out to be the easiest question of all, as 92.3% of you correctly labeled it "False". **End Summary** Topics: Retirement]]> income investing]]> seniors]]> boomers]]> Stock Market]]> Cycle]]> Investment Management]]> interest rates]]> Wall Street]]> ]]> About the Author: ]]> Steve Selengut http://kiawahgolfinvestmentseminars.net Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

IGVSI Bargain Stock Monitor - February 2010

Thu, 04 Feb 2010 14:36:40 -0500

The Investment Grade Value Stock Index "Bargain Stock Monitor" clearly reflects the profit taking that hit the market late in January--- you and I have been harvesting our gains all along though. Right? Although there are nearly twice as many IGV stocks 15% below 52-week highs as there were at year-end, there is no evidence that a new correction has commenced--- tune in again in March or April. The numbers are telling you that most Investment Grade Value Stocks are still well above bargain price levels, and no matter how much "smart cash" has accumulated in your portfolio, it's not necessary to re-load your portfolios with new stuff all at once. Like apples, one a day is just fine. Most Market Cycle Investment Management (MCIM) Program portfolios are still a hiccup or two below the all time high profit levels achieved in 2007, but those with larger income allocations are generally well above those levels. So, aren't you glad you've been taking profits and positioning yourself to take advantage of the new bargains sauntering down the runway? Take your time. Always start new positions slowly while you continue to take profits instantly. **End Summary** Topics: MCIM]]> market cycle]]> IGVSI]]> investment]]> performance]]> grade]]> bargain stock]]> monitor]]> value stocks]]> ]]> About the Author: ]]> Steve Selengut http://www.valuestockindex.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

IGVSI Bargain Stocks - Are There Any Left?

Sat, 16 Jan 2010 15:34:43 -0500

The IGVSI Bargain Stock Monitor clearly reflects the strength of this eleven-month-rallying stock market. In fact, the bargain monitor is sporting the best numbers ever recorded. No, this is not a "buy" signal. The numbers are telling you that most Investment Grade Value Stocks are at or approaching their highest valuations of the past 52 weeks. Market Cycle Investment Management (MCIM) Program portfolios are approaching the all time high profit levels achieved in 2007, and only a handful of IGVSI equities are at "bargain" price levels--- i.e., down 20% or more from their 52-week highs. Additionally, the most conservative MCIM portfolios have been achieving new all time highs regularly, for the past three or four months--- this because managed income closed end funds rose about 31% in market value during 2009. So, with the very best numbers we've seen in two and a half years, why aren't you taking profits and positioning yourself to take advantage of the next market correction instead of (as usual) being victimized by it? The Bargain Stock Monitor is reporting that a 52-week high has been achieved in Investment Grade Value Stock market values, but it is predicting nothing. **End Summary** Topics: MCIM]]> market cycle]]> IGVSI]]> investment]]> performance]]> grade]]> bargain stock]]> monitor]]> value stocks]]> ]]> About the Author: ]]> Steve Selengut http://www.valuestockindex.com Professional Portfolio Management since 1979 Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

A Dismal Decade? No Way - Market Cycle Investing

Thu, 07 Jan 2010 09:51:47 -0500

From the end of 1999 through the end of 2009, all of the popular Wall Street market performance measurement tools were in the red. The average bloodletting level of the DJIA, the S & P 500, and the NASDAQ was a disturbing-to-some minus nineteen percent. The Media has dubbed it "The Dismal Decade". Most of the investment community is either open-mouthed in shock or strident in blame about the somethings or someones who must be responsible for such horrific performance. Never again they swear to their clients--- without ever a hint that they might themselves be the problem. It won't be long before the Wizards of Wall Street announce that they have studied the situation, and readied their sales minions to switch the shattered investment public into yet another fail proof (fool-magnet?) portfolio of hedges, gimmicks, signal responders, and panaceas for whatever the new decade brings. Once again they will attempt to debug the market cycle and create an upward only future for the masses. Try not to be abused again--- the markets aren't broken, just the market shakers. Your portfolio should be up in market value--- and not by just a little for the "dismal decade". **End Summary** Topics: Stock Market]]> Cycle]]> Investment Management]]> Business cycle]]> interest rates]]> Wall Street]]> investors]]> Wall Street]]> advisors]]> ]]> About the Author: ]]> Steve Selengut http://kiawahgolfinvestmentseminars.net/Inv/Search.cfm Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

The Market Cycle Investment Management (MCIM) Program

Sun, 03 Jan 2010 11:57:10 -0500

During the past sixty years, most economic, market, and interest rate cycles have lasted from two to five years, peak-to-peak. Rarely have any of the cycle-tracking market indices moved in tandem, and none of the cycles are considered to be particularly predictable. Individual securities (the stuff that indices are made of) complicate things significantly by having even less predictable cycles of their own. This generally uncertain atmosphere is the very nature of the financial markets. If investors could come to grips with the non-calendar, cyclical, nature of markets, it is likely that they could improve their investment performance considerably. In spite of decades of irrefutable evidence to the contrary, Wall Street has convinced most investors and far too many financial professionals that the calendar year is somehow investment relevant. Simple, yes; tax-code friendly, perhaps; but investment realistic--- not. Too many experts have abandoned the financial world's fascinating cyclical undulations for the simplicity of the planet's annual orbit around the sun. It's time for a change in direction--- one that doesn't ignore the realities of the investment markets. It's time to get back on our "hogs", and ride! **End Summary** Topics: Stock Market]]> Cycle]]> Investment Management]]> Business cycle]]> interest rates]]> Wall Street]]> investors]]> advisors]]> market gurus]]> ]]> About the Author: ]]> Steve Selengut http://kiawahgolfinvestmentseminars.net/Inv/Search.cfm Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Investment Retrospective: A Preemptive Portfolio Protection Strategy

Fri, 23 Oct 2009 16:16:29 -0400

A participant in the morning Working Capital Model (WCM) investment workshop observed: I've noticed that my account balances are returning to their (June 2007) levels. People are talking down the economy and the dollar. Is there any preemptive action I need to take? An afternoon workshop attendee spoke of a similar predicament, but cautioned that (with new high market value levels approaching) a repeat of the June 2007 through early March 2009 correction must be avoided--- a portfolio protection plan is essential! What are they missing? These investors are taking pretty much for granted the fact that their investment portfolios had more than merely survived the most severe correction in financial market history. They had recouped all of their market value, and maintained their cash flow to boot. The market averages remain 40% below their 2007 highs. Their preemptive portfolio protection plan was already in place --- and it worked amazingly well, as it certainly should for anyone who follows the general principles and disciplined strategies of the WCM. But instead of patting themselves on the back for their proper preparation and positioning, here they were, lamenting the possibility of the next dip in securities' prices. **End Summary** Topics: WCM]]> working capital]]> workshop]]> investment]]> Wall Street]]> stock market correction]]> rally]]> crash]]> 9/11]]> ]]> About the Author: ]]> Steve Selengut Sanco Services Kiawah Golf Investment Seminars Author: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read" and "A Millionaire's Secret Investment Strategy".

How To Create A Fairer Tax Environment

Mon, 19 Oct 2009 14:02:17 -0400

Can lawmakers who don't have the courage or intelligence to outlaw texting while driving really be expected to create a saner tax structure? Hmmm. Developing a fairer tax environment is much less an economics problem than it is a political dilemma and, as many of you observed, it is unlikely that anything "tax" will be improved upon until there is some serious facial (and cultural) change in Washington. Politicians focus on one issue at a time, and pretend to have problems dealing with inter-related programs. Tenured politicians have a vested interest in resisting any change that involves their spheres of influence. Both parties are embarrassingly mired in twentieth century class warfare that stifles all forms of productive debate. Tax cuts don't just benefit the rich. In fact, they provide the opportunity for everyone to attain greater wealth. Demand directs resources far better than punitive taxation. Money in consumer hands will fuel social and environmentally friendly change. "You cannot eliminate revenue from one program without replacing it from another, equally complicated, one", career politicians will say philosophically. **End Summary** Topics: social security]]> reform]]> tax code]]> IRC]]> Inernal Revenue]]> IRS]]> congress]]> federal income taxes]]> business taxes]]>]]> About the Author: ]]> Steve Selengut Sanco Services Kiawah Golf Investment Seminars Author: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read" and "A Millionaire's Secret Investment Strategy".