Thursday, December 08, 2016

Amazon's Future of Shopping

Amazon Go, the cashierless grocery store, is another step in the evolution of shopping.   For my grandparents, store inventory was stocked in a back room and retrieved by the store clerk.  When I was a child,  shopping was self service, with payment at a central cashier.  Self-serve checkouts came after I became an adult.  Now, Amazon has advanced to no checkout.

There are some concerns that this will be the end of cashier jobs, of which there are 686,000 in the grocery industry.  That may be true.  However, there will be thousands of other jobs created.   As I read it, the technology is based on a number of cameras and sensors tracking the shopper through the store, and interpreting the shoppers actions to determine what is being purchased.   These cameras and sensors will need to be maintained, audited and periodically replaced.   Also, more security will be needed to update systems as hackers try to game the processes.  That will create numerous new job positions, although probably not directly transferable for displaced cashiers.

In addition, there may be opportunities for new higher value service positions that improve the shopping experience: for example, food concierges, who can help diets, recipes and other food related areas to differentiate stores from self serve status.  When the routine work is automated, knowledge based services will still be of value, IMHO.

It will be very interesting to watch how this experiment evolves, and its impact on the future of work for my children.

For more on Crossing Generations, check back Thursdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Wednesday, December 07, 2016

Financial Education Books

My brother-in-law asked my spouse what I might like for Christmas.  Usually, I don't have any good ideas.   However, this year I gave it some quality thinking and decided to request one of two investment books.  The first book is Common Stocks and Uncommon Profits and Other Writings by Phillip Fisher.   Warren Buffet claims to have used the principles in this book for his investing.  The second book is The Intelligent Investor: The Definitive Book on Value Investing by Benjamin Graham.   This is the classic textbook for value investing.

I have not read either book and based on reviews, I thought they would help improve my investing knowledege and results.





Disclosure:  No compensation was received for writing this post.

For more on The Practice of Personal Finance, check back Wednesdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Tuesday, December 06, 2016

Hunting for Value

Despite the stock market being near or at all time highs, there is still opportunity to find stocks on sale because they are out of favor, despite no fundamental changes in the companies' businesses. For example, REITs, consumer staples and utlility stocks have been going lower, getting close to 52 week lows.   While I understand the reason for the decline is that interests are expected to rise, it seems to me the stocks have been beaten down more than would be appropriate.  

So I've been buying small amounts of stock in these three sectors.  As usual, I may be early and the stock will be decline further.   However, I do expect the good companies in these sectors to rebound and these stocks also pay a good dividend (3-7%) which is a bonus while waiting.

Stocks I am considering:   Procter & Gamble (PG), Duke Energy (DUK), Phillip Morris (PM) Realty Income Corporation (O), National Retail Property (NNN), Game and Leisure Property (GLPI) and W.P. Carey (WPC).

Disclosure:  We own PG, DUK, PM, O and, NNN.  We may take positions in GLPI and WPC in the next 72 hours.

For more on Ideas You Can Use, check back Tuesdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Sunday, December 04, 2016

The Return of Economic and Financial Hope

My sentiment about the economy and financial opportunity has significantly improved in past month.  To me the reward/risk ratio has significantly increased for people invest money, invest resources, and invest personal effort for financial gain. Financial opportunity will greater for more people, and more money can be earned.

The pendulum is swinging towards rewarding people for the results they can deliver.  Personally, I have typically done better in a meritocracy (e.g. school, sports) where results mattered more, than in a bureaucracy (e.g  major corporations, government) where politics mattered more.

I am looking forward to having many more opportunities for financial success.

For more on New Beginnings, check back Sundays for a new segment.


This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Monday, November 14, 2016

Trading the Rotation

The market reaction to the election has been interesting.  Previously high flying stocks such as utilities, telecom, gold miners and REITs have been knocked down, with some getting close to 52 week lows.  Similarly, bonds have taken a big hit.   Previously beat up stocks such as financials, biotechs, and materials are rising, some by as much as 50% versus a couple weeks ago.  Energy stocks have been mixed, some have bounced and some are still down.

In the weeks leading up to the election, I was taking the opportunity to buy some beaten up stocks, that I already own.  Some of these have now rallied over 40%.   Since I don't think the Trump rally is sustainable, I plan, as a hedge,  to sell off some of the recent purchases for a profit, while keeping my core holdings.  That way if the market sells off, I will have locked in profits.  If the market continues to rise, my core holdings will benefit.

In addition, I will be looking to purchse stocks in higher dividend paying stocks that have been beaten down (and are now on sale :-) since the election:  REITs, utilities, telecoms, and consumer staples.  Despite the concern about rising interest rates, I still believe locking in 3-5% dividends is still a good strategy at this time.

For more on Strategies and Plans, check back Mondays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Wednesday, October 05, 2016

My Solution for Running in Place Frustration

Lately,the market seems to be having a lot of activity, but little movement in total value of our accounts.   When one sector goes up, another sector goes down, resulting a wash.  Lately, material, gold and utility stocks have been falling, while oil stock are rising.  This is just the opposite of what was occurring a few months ago.

Based on this activity, I will start taking trading positions in some of our core equity holdings.  That way when the stock rotates upward, I can take some profits and repurchase the trading position when the stock falls.   However, I will only trade shares in excess of the core position amount.  That way when the market resumes an upward trend, the core positions will all benefit from the market advancing.

For more on  The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Tuesday, September 13, 2016

The Fed Conspiracy

"People love conspiracy theories." ~ Neil Armstrong

Here's my Fed conspiracy theory:   Despite guidance to the contrary, the Fed won't be raising interest rates for the next few years.   The Fed will continue to keep jawboning about raising rates to keep exuberant asset bubbles from forming, but will continually find a reason not to do so when the time comes.

If the Fed really intended to raise rates, it could have done it by now, several times given the relative strength of the economy.  So I don't believe the Fed really wants to raise rates.

In the meantime, I will use the volatility caused by the Fed jawboning to purchase good dividend paying stocks as they decline and to lock in higher interest rate on long term CDs.

For more on Ideas You Can Use , check back  Tuesdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Wednesday, September 07, 2016

On Staying Invested in this Bull Market

"The reports of my death are greatly exaggerated." ~ Mark Twain

Despite the constant negativity from pundits, this bull market, which is the second longest at 7 -1/2 years, keeps grinding upwards.  This has been the most unloved bull market ever.   However, since March 2009, the best strategy has been to be invested in a diversified equity portfolio or a total market index and to add funds during any pullback or correction.

I, unfortunately, haven't been that brilliant.   Only about 25% of our funds are invested in equities,   However, I have been good about keeping that portion mostly invested, with only occasional instances of small profit taking.  Keeping the percentage of funds invested low had been worth the lost opportunity cost.  I have low anxiety about the funds that are invested, and therefore can sleep well at nights.

Despite warnings about the imminent end of the bull market, I will continue to keep about about 25% invested.   When the bull market does end, and it will, I will be able to bear the loss and be prepared to invest in the inevitable recovery.

For more on The Practice of Personal Finance, check back Wednesdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Monday, September 05, 2016

One Way to Time the Market

The Holy Grail of investing is to get in just before the market rallies and to get out just as the market tops.  Although I have had occasional flashes of success (such as selling before the 2011 correction), I have not been able to consistently make the right call.   The toughest part is deciding when to get back in the market after getting out.

So now I use a different approach to time the market.  Whenever the a stock I own rises significantly, I may sell off part of the position.   If it rises further, I sell off another part.     This continues until I until I sell out of the position.   Similarly if a stock in which I am interested in buy falls, I may buy a small position. If it fall further, I add another small portion.  I do this until I have reached my target position.

An astute investor might note that the commission costs of each trade may make this approach prohibitively expensive.  My solution is to do this trade in commission free ETFs offered by the major discount brokers.   I can trade as little as one share with $0 commission cost.  The only caution is that some brokerages have a minimum holding period of 30 days, which is not that difficult to meet.   Some brokerages have no minimum holding period, which offers even more flexibility.

I have been doing this timing trade with a total market index ETF.   Right now I am selling off small positions, because I expect to be buying back at a lower price soon.

For more on Strategies and Plans, check back Mondays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC

Saturday, August 13, 2016

What Would George Costanza Do In This Market?

"...if every instinct you have is wrong, then the opposite would have to be right." ~ Jerry Seinfeld to George Costanza in episode 86.

This market is unbelievable. All three major indices closed at new highs on the same day this week. The last time this happened was in 1999, just before the dotcom crash which was followed by the 01/02 bear market.

Every investing instinct I have is telling me the market is too high, that this is too good to be true, and that a market top is near. A correction has to be coming soon.

My instincts are screaming, "TAKE PROFITS NOW!"

However, every sell instinct, except for one, since the 08/09 crash has been wrong. The only one that I acted on correctly was in August 2011, but then I stayed out of the market too long.

So I am going to do the George Costanza opposite. I'm going to stay in the market, for the most part. However, I will use the opportunity to reduce my holdings in company stock, sell some losing stocks, and take some profit in stocks that have advanced significantly.

Otherwise, I'm going to brace myself and hold tight. I may even hold my nose and invest more fund in equities should the market pull back.
For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2016 Achievement Catalyst, LLC