February 2005

Increasing Returns Through Small Cap Stocks

The latest issue of Investing With Mom is now online.

Included is a comparison of Exxon Mobil and Encana, a stock first recommended by yours truly back in the 2nd issue ever published by Investing With Mom.

I'm also going after broker commissions and fees again. Unless your broker is providing a service you can't get anywhere else, then you can easily reduce your costs by switching to the lowest cost provider available. It could instantly improve your portfolio's results by several percentage points.

How I Saved Bob $2000

...is the latest issue of Investing With Mom. Enjoy!

Social Security and Demographics

Finally got a chance to read this weekend's newsletter by John Mauldin, who wrote our recommended book Bull's Eye Investing, and once again he is outstanding. Let me share just a brief snippet from the newsletter, additionally I highly recommend reviewing the demographic info Mr. Mauldin published with the newsletter:

"This underscores the importance of one of my primary investment themes: this is the era where investors should be seeking absolute returns. Let's revisit one of the last paragraphs:

""The boomer generation will demand goods and services, and because there are not enough workers, the economy will not be able to supply enough goods and services, and workers will demand more of the saved assets of retirees for what they produce. This can come as increased prices for the production, as a drop in the value of the saved assets, or both. That means either an inflation in prices or a deflation in wealth or a combination of the two."

"You must have a strategy that will allow your portfolio to outperform inflation. But you must also be hedged against a deflationary drop in the prices of your assets. For most investors that means the stock market. That is why I am against an investment philosophy which says you should be a long term buy-and-hold investor of index funds for the rest of this secular bear market cycle. If you have 40-60 years before retirement, you will have time to recover. However, if you want to retire in the next 20 years, and are depending upon not only your principal but some hypothetical compound number to provide that retirement, I think there is substantial risk in such a relative return strategy.

"A properly executed absolute return strategy will allow you to both beat inflation and hedge your investment portfolio against this secular bear market cycle. I certainly expect you to be able to retire and prosper in the coming years. It is going to be an exciting time."

Absolute returns are definitely the key, without which any retirement plan, and especially Social Security, is doomed.

If you don't agree with me, just ask a couple of people who had their entire retirement invested in the NASDAQ during 2000-2002, how much longer they'll have to work before they can afford to retire? Just amongst my Advisory Newsletter subscribers, I know of several who lost hundreds of thousands thanks to investing uncertainties, whether from the NASDAQ crash or not.

Well, that's why I'm continuing to work on providing this service, Investing With Mom, to any and all who care to read it. I want to make sure that every small investor, and any big investors too, who so chooses to read my writings will know where to go to achieve absolute returns.

craigslist.org

Just posted information regarding the new Q-Timer Service on dallas.craigslist.org.

Having never used craigslist before, I'm curious to see what kind of response I get, if any.

Please comment to this blog post or send me an e-mail, if you came across our site from craigslist. I would appreciate it greatly.

Investment Blogs

Currently there is voting underway for the best investing blogs, and while I'm not certain that they provide good information unless you are a day trader, I wanted to make you all aware of them.

My personal favorites are listed in the Resources Blogroll on the side of this page. Granted not every link in the Resources Blogroll is a blog, but in my opinion you will find each link to be a treasure trove of useful information.

Those of you who have spent a little time either reading my weekly newsletter or perusing the older posts on this blog, will understand that this is not a trading blog, but rather a blog about issues related to small investors and Investing With Mom. That said however, I have already started publication of a true investor's blog and it will be available to paid subscribers to my Advisory Newsletter as soon as my webmaster and I have the password protection worked out.

That should be about the same time as the Q-Timer Service is ready, Valentine's Day.

What a great gift for the investing loved one in your life. ;-)


PS. For those of you who are curious, the Blogroll of Friends, that is just above the Resources Blogroll, is only populated by people I know personally and most have nothing to do with investing. I've simply put them there because I want to. If you know me, feel free to send me an e-mail and I'll be glad to consider your blog for inclusion, but don't be disappointed if it takes me a while to decide. For the rest of you, enjoy.

3 Hot New Stocks

Just got recommended to the paid subscribers of the Advisory Newsletter.

Since today is Chinese New Year's, I thought I'd let everyone know what my New Year's gift to my paid subscribers was: 2 hot tech stocks trading for below IPO levels and the most undervalued utility in the world. But you have to subscribe to learn more.

One last hit, I just noticed that TravelZoo's Top 20 is featuring one of our portfolio stock's fares this week. Have fun flying.

Yield Drops Like A Stone

At least that's exactly what the 10 year bond yield is doing at the moment, and it's causing the yield curve to flatten noticeably.

Here's the raw data, but for the full visual effect, take a look at the second chart on the Investing In Bonds website, the Treasury Yield Curve chart. The orange line is the key, as the 2 year yield rises and the 10 year yield drops toward parity, and eventually, maybe an inverted yield curve, we will see the first, and possibly only, indication of an oncoming recession in 2006.

Section 3 in the January 10th issue of Investing With Mom, covers more of my thoughts regarding an inverted yield curve.

Q-Timer Service Launch

Full details are in the current issue of Investing With Mom.

Q: Can I use this service in any market?
A: Yes! The Q-Timer Service can be used by options traders, forex traders, day traders, buy and hold investors, American investors, Australian investors, English investors, anybody can use this service in any market. Having said that, certain markets will not get a lot of coverage in terms of recommendations from us, but eSignal has a complete list of markets available, as does AlphaTrader.

Q: Do I have to have a data feed?
A: Yes! The key part of the Q-Timer Service is a highly robust proprietary formula that signals buy and sell indications for your trades. Without a feed, the formula doesn't do you any good.

Q: What is the Q-Timer Service's accuracy record?
A: The Q-Timer Service is brand new, but the proprietary formula that it utilizes has an accuracy level in excess of 70-80%. This formula has only just recently been made available to private investors. Prior to November, 2004, it was only available to hedge funds and institutions, all of whom pay between $900 and $8000/month/user, depending upon assets under management and number of users. They love it, and rightly so.

Q: Can we get the formula from the developer himself?
A: Sure, but you will pay the same either way. The only discount that is currently available, is what I'm offering my Advisory Newsletter subscribers! The only requirement is that you have to have subscribed by 12:01pm this coming Valentine's Day, Monday, February 14th, 2005! After that, you'll have to pay the same price as everyone else.

Q: Why is the Q-Timer Service so expensive?
A: Here's what I told my Advisory Newsletter subscribers about the Q-Timer Service:

"To sum up Q-research, it is a high-level
mathmatical analysis of the markets that
simplifies it all into an if-then equation.

"That's it!

"Think about that for a moment, if you knew exactly
what was going to happen in the markets, 70-80% of
the time and you could apply that knowledge to any
market in the world...

"How much money could you make? In all honesty,
you'd only be limited by the amount of money you
started with and your ability, or inability, to
follow the indicators that this Q-research
provided. It would be just that simple."

With big money subscribers paying thousands of dollars per month, I think that the price offered to Investing With Mom subscribers is quite reasonable. It may not be for everyone, but then again not much in life is!

Q: Do I have to subscribe to the Advisory Newsletter to be able to get the Q-Timer Service?
A: No, but you'll pay more money that way. Wait...

that means I'll make more money.
Go ahead, you can subscribe to the Q-Timer Service without subscribing to the Advisory Newsletter. I promise I don't mind. ;-)

Q: If I have any other questions, what do I do?
A: Just use this form to contact me with whatever questions you might have. I'll get back to you as quickly as I can, I promise.

New Service Being Launched

Investing With Mom's Advisory Newsletter Service achieved 13.6% return in first 3 months, now launching Q-Timer Service.

More details to come...

Update: Q-Timer Service press release, here, here, and here too.

Ongoing Social Security Debate

Well, I'm back home now, after spending an extra 24 hours out in Mississippi, and what's the first thing I do after coming home?

I immediately comment on another blog's post regarding Social Security.

After doing so, I received this very nice e-mail this afternoon:

"I agree that the system needs reform. I just don?t think it?s in crisis.

"I would like to see some modification in how the social security monies are invested by the government, and I would like to see private accounts supplement the existing system.

"I?m concerned though about tinkering with the guaranteed feature of the program. The public lacks knowledge about investing. I would not like to see us give it the responsibilty and risk of managing the monies in the foundation of its retirement program. Please keep in mind that there?s no guarantee that equities will provide good returns in the future. We had a 16-year period, from 1966 to 1982, in which equities were a very poor investment. Those would have been unfortunate years in which to retire.

"Thank you for your comment. I will look at your site. Herb H."

This leads me to several additional thoughts regarding Social Security, and specifically the retirement age, that I will be including in upcoming issues of the newsletter. Feel free to shoot me an e-mail if you have any thoughts regarding Social Security that you would like me to comment on.