Thursday, December 15, 2005

Our Investments

We would be a foolish group if we wrote about all these great ways to make money strategically and save money strategically if we ourselves were not invested in various opportunities. So without giving away too much information about our personal finances- here's a glance into the different things our group has chosen to invest our hard-earned money.
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SL Investments:
GOLDX - Gold Mutual Fund
ORCL - Oracle
VPACX - Vanguard Pacific Mutual Fund
VTIVX - Vanguard 2045 Target Retirement Fund
IBM - International Business Machines
401K
1 year CD ending in Feburary

Reasoning:
As the youngest member of the group, I probably know the least about investing. For this reason, I asked many people before choosing the portfolio I have above. ORCL was a high school stock that I have never sold - but should have four or five years back. Being that at one point I could have made over 400% on the investment, It's a tough lesson on unrealized gain that I learned the hard way. GOLDX, I'm hoping won't be the next ORCL. Why invest in gold? This was a pick that my father recommended. Hedging against inflation and the weakness of the US dollar are probably the two biggest reasons for investing in this comodity. Like DD, I'm starting to believe in international stocks and for this reason I choose VPACX. VTIVX is Vanguard's target 2045 retirement mutual fund, so I thought that wouldn't be a bad choice - seeing that I hope to retire around then. I max out my Roth IRA, and next year am on course for maxing out my 401K. When my one year CD ends, I'll let you guys know what stock/fund I picked.
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RS Investments:
House
Tax Auction Properties
401k
VTMGX - Vanguard Tax-Managed International Fund
VTSMX - Vanguard Total Stock Market Index Fund Investor Shares
VMMXX - Vanguard Prime Money Market Fund
I-Bonds - Inflation Protected Bonds
IBM - International Business Machines
IBZT - IBIZ Technology Corp.
MNST - Monster Worldwide
TMIC - Trend Micro
WIND - Wind River Systems

Reasoning:
Let's start out by saying that looking at my portfolio, it doesn't seem that there is any reasoning. That is partially true, this is a tale of 2 investing "strategies" (term used very loosely). I graduated in 1998 and started working while the tech-boom was still going on. At that time, stocks looked good and everything was going up, so I bought a bunch of random stocks that people suggested or that I saw on some money show on TV. I had no real clue about investing at this time. Let's just say that not many of those turned out so hot, but I do still hold some of them. I have a hard time selling them when they are down...maybe it is phsychological, so I am still waiting for them to go up. I know how bad this and that I should sell them and put that money into something that is making money...maybe that will be my New Years Resolution. After the stocks, I have some Vanguard index funds. This is the new strategy that I am more of a fan of...too bad I started a little late. I have personally seen that I am not smart enough (not really that I am not smart enough, but I don't have the time to study stocks and invest in them) to beat the market myself...so now I am going the slow and steady route. I am under 30, so I have plenty of time until I retire to make money, so index funds are the way to go for me now. I also have an emergency fund in the form of my money market account, but I am not sure exactly how much I should have in there. An article in the future will talk about this a little more. I also own a house (not outright yet) and put 6% in my 401k to get my employer match. I recently invested a little bit of money in some properties at a tax auction. This is my first experience with this, I will see how it goes.
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DD Investments:
401k
Real Estate
VIGRX - Large Cap Growth
VISGX - Small Cap Growth
VTRIX - International Value
VNYTX - NY Long Term Tax Exempt Bonds
VBISX - Short Term Bonds
VMMXX - Prime Money Market
IBM

Reasoning:
I have always had the money market for my emergency fund. I invested in my growth stocks because I started several years ago when I thought the stock market might make some solid gains and wanted to get good benefits. I might switch these to either the total stock market or 500 index with small cap value if I wasn't afraid of taking all the long term cap gains. Since then I've become more a fan of value and international so I started investing in international value. I've lately thought about the higher rates bonds are getting and having money around for if the stock market goes down to reinvest and so I chose short term bonds. This was also done in part to try to gain more understanding in bonds. I also recently got NY LT tax-exempt bonds as an investment for the mid-term horizon. Perhaps this should of been i-bonds instead but we'll see. I rent but own 2 pieces of real estate. I max my 401k every year.

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