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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: sjemmeri who wrote (32345)	10/7/2008 10:04:55 AM
From: rllee	Respond to of 78704

The 7% plus in muni's is just the yield while you wait for price recovery. I fully expect that the 20% discount in NAV will narrow in time thus increasing the overall appreciation to over 10% or more.

To: sjemmeri who wrote (32345)	10/7/2008 4:02:29 PM
From: Don Earl	Read Replies (1) \| Respond to of 78704

RE: "And yet isn't that only 7 % per year minus whatever the holding costs are." It would be 70% the way you're figuring it, although in that context, it's a compound interest problem that isn't figured by using straight division. If you know someone who has a calculator that will do compound interest problems, it might be interesting to see what rate of compounded annual interest would turn $1 into $900 in 100 years. Off the top of my head, I think you'd be in the ballpark of 15-20%.

To: sjemmeri who wrote (32345)	10/10/2008 4:35:33 AM
From: Don Earl	2 Recommendations Respond to of 78704

RE: "I think all regular participants on this board firmly believe they can exceed that return in the long run." That's always the belief. The Wilshire 5000 is down 40% for the year, 20% of that in the past week. The more diversified a portfolio, the more certain it is to track the market as a whole. Gold on the other hand is up 10% for the week. Dollar for dollar, it beat the market by 30%. The only way to beat the market is to limit your exposure to the market. There might be one or two times per decade that stocks truly represent a good value. Those are the only times it is anything other than financial suicide to own stock. There are also maybe one or two times per decade that it makes sense to short the market. At those times out of the money index puts, a year or more out, are the best value. The rest of the time, the stock market is nothing more than a fancy way for compulsive gamblers to lose money.