Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Elroy who wrote (66740)	3/2/2021 12:15:42 PM
From: E_K_S	1 Recommendation Recommended By DinoNavarre Read Replies (2) \| Respond to of 78768

For me it's preservation of capital and buying power, not total return. I plan to hold my commodity fund for years, not weeks/months (a very large minimum investment required) and that is the reason for my purchase and diversification. You see, w/ your view, quick gains also require higher taxes when you sell. I tend to never sell but hold the asset. That is really not possible w/ a cyclical business like fertilizer (you are either in or out). As an example, I can not sell my home in Silicon Valley as I would have over a $250K tax liability (Federal & State) from the Capital Gains tax. I get more utility out of it as a Vacation Home. The asset has more than 10x in value since I bought it in 1981 and it only has maintained it's purchasing power. If I bought & sold a similar equity assets, I would have paid more in taxes than what I invested rather than obtaining the long term value by just holding the asset. This is my long term view w/ the 'Exit' strategy being that my beneficiaries will receive the asset, w/ a step up in basis and that $250K tax liability vanishes. In the mean time, I get the use out of the home, pay 35% of what other people pay in property taxes (CA Prop 13 rate) and the asset provides me more utility as a long term Buy & hold investment. -------------------------------------------------------------- Conclusion is that each individual has there own specific investment objectives than just to maximize the return on an individual cyclical stock (w/o factoring the tax impact and other utilities of the investment). So, for me really no comparisons, it's the composition of the entire portfolio of assets that matters. Another reason I hold almost 80 individual securities and several different mutual funds (at Vanguard). FWIW, you can 'search' the board under tools for the specific Vanguard fund name. Just use the search term commodities and/or Vanguard.