bmneveu's Account Talk

[bmneveu]

Only 7 out of 600 people on the autotracker are beating the C Fund for the year. Pretty wild! Can I call dibs on the C Fund's prize if it finishes top 5?! :laugh:

 

[Whipsaw]

Says something about buy and hold, doesn't it?

 

[bmneveu]

Says something about buy and hold, doesn't it?

Sure does! I am about 90% buy and hold these days. My trading account is much smaller than my TSP account, and is really there so that when I get the itch to trade, I don't make massive moves with my big money account.

 

[bmneveu]

I saw the pop yesterday when The Fed started talking, but didn't realize we ran up that far later in the afternoon. Nice surprise to see those gains this morning along with futures being up. J Powell playing Santa this year.

 

[bmneveu]

IFT to 100C today.

The C Fund is +4.44% from the S Fund since I made this move. That has worked out well so far.

 

[bmneveu]

Wondering why financial stocks have such low P/E ratios when they have such high earnings. Makes me wonder if this is an extremely undervalued sector right now...

 

[Bullitt]

I've seen it called both ways, but I'm mostly bullish on banks going forward. Valuations (P/E ratios) are still out of whack from COVID. It seems the bullish case is higher rates which allow banks to charge more to borrowers. But then again, high rates could slow the rate of borrowing so it might not work out.

The very low interest rate environment we've been in since March 2020 has not been positive for banks net interest income, but refinancing has brought in $$ from the refinancing fees that people often overlook. Other factors that generate money include wealth management and credit card usage (which should rise as COVID shutdowns and stimulus wane).

 

[mmk119]

Wondering why financial stocks have such low P/E ratios when they have such high earnings. Makes me wonder if this is an extremely undervalued sector right now...

someone correct me if i'm wrong - but, I believe banks are permitted to cary certain debts as a plus. could that be reflected in the low ratio?

 

[Bullitt]

Yeah that's certainly weighing on them since loan loss reserves were upped during the pandemic. Most banks have been releasing some of those reserves as things have normalized, resulting in more "profit". That's money that can be used instead of just parked.

 

[Bullitt]

RE: Banks; Investment houses raised price targets for JPM, MS, GS, BAC today. C, still reeling from 2008, was lowered.

 

[bmneveu]

Currently sitting around $450K net worth at 34 years old. Brainstorming how to get to $500K this year and $1M before I'm 40. Gonna depend heavily on market performance, but also planning on lowering expenses after PCS and also saving/investing all extra deployment pays.

 

[Whipsaw]

I just subscribed to Motley Fool for 2 yr discounted access. They're approach is new money blue chip buys, 5 yr plus hold, they screen and recommend stocks - makes sense. Reporting 3x to 4x returns... will see how that goes. Maybe something to consider, your time horizon is good.

 

[bmneveu]

We are planning to sell our home in 3-6 months when we PCS. It has appreciated substantially during this 4-year tour in Tampa. Now to figure out what to do with the profits of the sale while we rent in Hawaii for the next 3+ years. We have no debt and our savings are good. Best thing I can think of is to put it in an index fund and let it ride until we are ready to buy our next home, which could be anywhere between 3 and 10 years from now. Would potentially double in that timeframe and be enough for us to buy our "forever" home in cash.

 

[tsptalk]

If you read John Hussman's market commentaries you might change your mind about buying and holding stocks over the next 5 -12 years.

Of course he's been saying that for a long time so... but he said the same thing in 2007.

I think the next few years will be questionable myself for several reasons including valuations, although the small caps have sure gotten a haircut recently.

Good luck! You've done a great job with your financial situation!



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[Bullitt]

No allocation to crypto with that money?

 

[bmneveu]

No allocation to crypto with that money?

Probably not just because I've already maxed out my allocation / risk tolerance there.

 

[bmneveu]

Coffee futures have doubled in the last year. Might not be able to afford my coffee addition soon at this rate!

 

[bmneveu]

although the small caps have sure gotten a haircut recently.

The R2K is down more than 20% from the high, which I believe is the threshold for "bear market". We've also seen some pretty big stocks drop more than 50% as well. There are some really nice prices out there right now.

 

[bmneveu]

100% G COB today. Too much risk out there right now for me. Also looks like a short-medium term double top on the S&P 500 daily.

 

[bmneveu]

When our annual pay raise is 2.7% to offset inflation, but inflation is 7.5% :suspicious: