bbarberayr

At a high level, insurance companies put their investments into 2 buckets - held to maturity and held for trading. The held for trading ones are market to market, so can cause investment losses and profits, but the help to maturity are held at cost and amortized over the life of the contract, so when we had the financial crisis, their earnings were less affected than most companies that hold investments. Also, insurance is typically priced using an assumed interest rate of around 3%, so even though government bonds are much less than this, it is still possible to achieve this return in a good portfolio of investment grade bonds.

Miami market getting hit by a reduction in overseas buyers. Different market and different buyers, but a lot of the same drivers. http://www.bloomberg.com/news/articles/2015-06-05/miami-s-hot-condo-market-cools-as-dollar-derails-buyers “Everybody is looking at Miami and saying when is something bad going to happen?” Rosso said. “And I say this is a different market. You’re not going to have a bubble burst.” > The above quote sure sounds like Vancouver

Not an important question, but hoping someone can help here as can't find an answer anywhere else. When filing income taxes, is it really necessary to input all of the costs of buying and selling stocks in the full decimal version or is it OK just to round to the nearest dollar? For example, if I buy a stock for $10,000 + $9.99 commission, is it OK just to put $10,010 on my taxes instead or $10,009.99? Would save a bunch of typing and not be meaningful in the overall tax paid, but don't want to set my self up for the pain of a CRA audit. Has anyone done this and what were the results? Thanks.

Here's a survey which again points to DNA being important, but not the sole factor. This is from a website about early retirement and living off your investments: http://www.mrmoneymustache.com/2013/09/17/a-one-question-survey-who-are-the-mustachians/ So, people who are high tech/engineers and particularly software engineers have the brain type or DNA which got them into engineering, but are also interested in investing. "But among software engineers, the likelihood of Mustachianism is a solid 50 times higher." Trades and Artsy people have the DNA which makes them the least likely to be interested.

I've been at this for 4 years. On an overall basis I've outperformed over those four years. Do I think I'm a "winner"? Heck no. I'm convinced I will probably under-perform over my lifetime. I am OK with that. Let me repeat that: I am OK with underperforming. It is still possible to get rich despite underperforming. I don't have a huge capital base where a 2% difference translates to millions of dollars. I concentrate on being good at my job and increasing my salary and title. If my stock picks (in my signature) underperform a bit, I am OK with that. I think they have more sustainable earnings than the S&P as a whole, but I am going into the "deal" assuming I could very well be wrong. I am OK with that. In fact, I think most of my "errors" have been due to reaching too hard trying desperately to outperform. Now I just try to find stable cash flows at a reasonable price (i.e. market multiple) and "get rich slowly". A couple of points. 1. 2% a year does make a signifcant difference over time - 6% compounded over 30 years = 474% profit; 8% compounded over 30 year = 900% profit 2. The fact that you are willing to underperform and are looking longer term increases the odds you will outperform over time - it's the short term thinking and not handling market volatility properly that really hurts returns

I'm sure its the type of thing where you need the DNA, but also have to be willing to work hard to be a very good to great investor. I'd compare it to things like top-level sports or games like chess, where you have to have the DNA and do the work to be at a top level. If you are not athletically gifted, you will not become a top tier athlete no matter how hard you work. Likely the same applied to investing, if you do not have the proper mental attitude, intelligence, self control, etc., you will not be a top tier performer. You can work hard at either and become a good athlete or a good investor, but to get to the top levels, you need both.

I think one major issue is people don't accurately track their results and think they are doing better than they are. You need to measure! Having said that, I started investing back in 2000. I didn't really make my own picks back then and was working a full-time job, so would just copy picks from other successful investors. But reading and applying logic to them was fairly easy to me and deciding which ones made sense, and I started outperforming the markets right away and have done so 13 of the 15 years. I have read the standard books, but that only helped my approach. So, I would tend to agree that there is some DNA/personality traits involved. But the other comment I would make is you have to match your investment style to your personality. Maybe you are a safety oreiented, deal hunter, so use the Ben Graham approach. Or maybe you are great at identifying early trends, so use the Peter Lynch approach, or maybe you can identify great companies, so use the Fisher approach. There is no one right way. And if you have no real advantage, keep focused on your hotels and buy market ETF's and you'll do great.

Vancouver house prices will correct. Because they've been going up for 15 years, people assume that they will forever. Price has taken over from fundamentals and people are just thinking price. Every situation where people assumed something would go up forever has ended up being a big problem (US housing crisis for example). Here is historical Vancouver house prices - https://vreaa.files.wordpress.com/2010/09/vreta-chart-0-lines.jpg See the 20%+ drop from 1994 to 1998 and the 1994 prices was not surpassed for almost 10 years. It can and will happen

Don't kid yourself, New York has had tough times in the past: http://9640-presscdn-0-28.pagely.netdna-cdn.com/wp-content/uploads/2015/09/Manhattan-Real-Estate-Roaring-20s-and-Great-Depression.png http://www.jparsons.net/housingbubble/new_york.html I couldn't find a chart for the 1960's to early 1970's, but that was a tough time too when NYC almost went bankrupt.

WARREN BUFFETT: The foundation of every market bubble is a 'sound premise' http://finance.yahoo.com/news/warren-buffett-explains-why-market-bubbles-occur-190745165.html The reality is there are reasons for house prices in Vancouver and Toronto to have gone higher. In Vancouver, you've got a desirable moderate climate and limited land supply due to the mountains and ocean. Plus it is geographically close to the far East which is looking for ways to get some of its money out. Similarly in Toronto, you have Canada's economic engine and the designation of the Ontario Greenbelt around Toronto which really limits new development and causes a supply / demand change for Toronto homes. But, as Buffett says, "And the price action becomes so important to people that it takes over the -– it takes over their minds…” The real question is has price action overtaken fundamentals - I think so, but hard to know for sure and, even if it has, even harder to know when it stops. But, if it has, there will be a lot of downside in both markets when this comes apart.

In case you haven't seen this, the Teranet web site is good: http://www.housepriceindex.ca/default.aspx What's interesting is many cities have done pretty much nothing pricewise for 5 years now, the Vancouver and Toronto/Hamilton areas continue to do well. I'm also not sure why the Vancouver market is so heavily weighted - more than Calgary and Edmonton combined.

That is of course one of the reasons it is so cheap! I'm pretty sure they are legit, or at least the business is real (unlike Sino Forest) - a few years ago, one of the major brokerage firms went for a site visit and came back with a positive report. Plus, they do their US reporting and hold conference calls, so don't look to be hiding anything. But, there are China risks, so would keep it a small position, but it is so cheap, something good is bound to happen if you are patient.

Cheapest stock I've found is SORL auto parts - symbol - SORL Consistently profitable, growing business. $34 million market cap -$32 million EV as cash- debt is $66 million more than market cap p/e of 3.0, fwd p/e = 2.5 Bad thing is no dividend and, while management says they are concerned about the stock price, they don't really do anything. Had a lowball offer to see a few months ago, but that came off the table. Would suspect some rich Chinese investors will buy on the cheap in US and relist in China for good profits, but who knows if/when.

I agree. Would recommend reading to anyone interested in Canadian Preferreds.

You could look at some merger/arb opportunities to generate relatively safe income: http://www.mergerinvesting.com/pendingmergers

http://www.bloomberg.com/gadfly/articles/2016-02-11/investors-ponder-the-value-versus-growth-debate Cheapness of value stocks vs. growth getting up to 1998 levels. Growth outperformance did continue for a couple more years, but then value stocks outperformed for 7 years by 8.5% a year. I'm happy to see money coming out of AAPL, IBB, etc., even though I think this selling is dragging the market down and I also think there is a lot of forced selling coming out of the Middle East. Once the fear and forced selling subsides, people will be looking for places to put their money and I think they will be staying away from the AAPL, IBB stocks which hurt them recently and see things like ING at an 8 p/e or UNP at 13 p/e and move into those types of stocks instead.

Great article on CAPE and why it is not a useful predictive model: "At around 20 years, the correlations start to break down. By 30 years, no correlation is left. What we have, then, is clear evidence of curve-fitting. There is a coincidental pattern in the data from 1935 to 2004 that the model latches onto. At time horizons between roughly 10 years and 20 years in that slice of history, valuation and growth happen to overshoot their assumed means in equal and opposite directions, such that the associated errors cancel, and an attractive fit is generated. When different time horizons are used, such as 25 years or 30 years or 35 years, the overshoots are brought into a phase relationship where they no longer happen to cancel. With the quirk of cancellation lost, the correlation unravels." http://www.philosophicaleconomics.com/2014/06/critique/

Anyone who pays attention to CAPE has missed out on one of the best bull markets in years (look at John Hussman). It is not a useful metric and I would say the 10 year timeframe was arbitrarily picked to support a theory. Many stocks are quite cheap now and, unless we are getting into a recession, which seems quite unlikely, this downturn is closer to the end than the beginning. I wouldn't say it is time to get "Very BULLISH", but if you have a longer timeframe, you want to be looking for places to buy.

With every episode of QE the Fed becomes less effective, which is why I somewhat support Clinton for her infrastructure spending plan. I've always thought it was appalling that we couldn't get it together and support the financial crisis with a little fiscal policy. It would make me comfortable to elect someone who isn't afraid to talk about it. That said, if Bloomberg ran, I'd vote for him in a heartbeat. Do you think Clinton will; actually be able to get this through with the high debt and a probable Republican Congress focused on reduced spending? That's one of the reasons I'm thinking a Rubio might be best for the market as a joint Republican President and Congress might actually be able to get things like this done, which just seem like logical things to do. I own a couple infrastructure related companies and spending like this would certainly help them.

Which President would be best for the stock market? With the Iowa caucus results last night, Rubio has become the Republican odds favourite and 2nd to Clinton for the Presidency. http://www.oddschecker.com/politics/us-politics/us-presidential-election-2016/winner Personally, I think Rubio would be the best President for the markets, assuming the Republicans retain the house in order to get the government moving again, but anyone have other ideas?

Another good source of info is: http://www.prefblog.com/ If you are interested in convertible preferreds: http://www.financialpost.com/markets/data/bonds-debentures.html

Globe has a good article on this: http://www.theglobeandmail.com/globe-investor/investment-ideas/interest-rates-provide-answers-about-plunging-preferred-shares/article24013205/

I'd question putting Donville Kent on this list. They've only been working the current bull market and have a pretty aggressive growth style, which has been the flavour of this bull. They make the transition with the market successfully, or they may be just another flash in the pan that comes to the forefront every bull market. Too early to tell.

If you want to understand why Hussman's approach is poor, take a look at : http://www.philosophicaleconomics.com/?s=hussman Basically Hussman back fits data to fit his hypothesis, but it has no relevance going forward. If he had a different hypothesis, his approach would have picked different data points to support that. This web site also shows how CAPE, which Hussman bases a lot of his decisions on (foolishly I think) is not a viable metric and is, again, the case of backfitting data to a hypothesis. Very good reading and helpful in understanding how you need to really think about things logically and not look for these quant type shortcuts.

David Tepper is the current King of the hedge fund hill with gross returns of 36% and net returns of 28% (as of 2013). Then there is the Renaissance Fund, which returned over 35% after fees since 1998. But neither of these funds want or will take your money of course.