Planet-Warren.com

Stock Trading & Why I Took Control of My Portfolio

In 2008 I took control of my personal financial portfolio. I made this decision not out of the need to have one more thing to do, but out of disappointment and frustration. My money manager, with whom I had been with for over 8 years, had done a great job telling me what a great job his company was doing. The results were quite different.

I hired a money manager when my personal wealth started to grow and felt too busy to competently leverage those funds. In the ensuing eight years, I blindly wrote checks and felt realtively confident the dollars were being adequately invested. Each quarter I would get a summary of my account, throw the statement in the corner and go back to work. At the end of the year there would be a slight glance at the percent of return and once again I would pretty much shrug it off. Like most professional people, I was far too busy to actually analyze what and how my money was being invested. After all, I was trying to keep my business running. I figured these folks knew what they were doing and, like myself, were professionals and only wanted the best for me. Right? I could not have been more wrong. Most firms are fee based and not result oriented. They get paid whether they make money or me or not. I only got paid on results.

In 2007 I sold controlling interest of my company. It took me another 8-12 months to, clean out my office, rent the space and reset my personal compass. This was also the year that the stock market took a huge downturn. I had counted on the return on investments to help me through to the next step in my personal career. I took greater notice of my portfolio and started a serious dialog with the money manager. I was not just moderately surprised at what I heard but totally shocked.

My partner had been with this firm for over 12 years and is the primary reason I chose them. I think it is important to note that from an honesty stand point, these folks are beyond reproach. My issue was entirely with the firms philosophy towards managing money. This company, as with most, will boast that you are paying for personal service and custom portfolio management. As I dug further, their custom approach was not a fine tailored suit but instead more of a jumpsuit with a draw string on the end. So I thought I was buying into one thing and in all reality I was getting the same treatment as any of their other clients.

Most portfolio managers would agree that a diversified, well directed and moderately conservative stock portfolio should return a 10% per year return over ten years. In other words, in ten years, if you reinvest the money earned in any prior years, you will end up doubling your original investment. More aggressive hedge funds can do significantly better or even lose money. In 2009, the top hedge fund returned 130% in a single year. Of course it didn’t hurt that the DOW rose 55% that year. My portfolio returned less than 5% per year in eight years; pretty dismal considering we experienced some very good years.

So I took up a new hobby. Actually, researching stock trading became my new full time job. Not everyone is cut out to be a stock trader. Did I have what it took? I rented a desk to a guy once in 2003 and watch him trade away $250,000. He finally had to get a full time job to pay his rent. I didn’t want the same thing to happen to me. Over the next 6 months I took several seminar classes and read dozens of books. The firm that managed my account charged a monthly fee based on the value of the account no matter if they traded on the account or not. Since the market was down and I was not giving them money to reinvest, they were getting paid to do nothing. I changed my primary account to “unmanaged” status. Fees are only charged on a schedule as used on my personal direction. This saved me about $700 per month.

At first, I dipped my toe and called specific trades into their office. An individual would have to sit at a terminal while I was on the phone and place the trade for me. It was slow, cumbersome and, at times, awkward.  It worked fine for a few months while I learned. I traded pretty small quantities and although the per transaction fee was quite high, I figured it was worth the cost of education. I learned a lot about myself, what drives the market and if I really wanted to do this.

By the end of 2008, I had successfully traded some stocks and decided that there was nobody more concerned about my money than me. Even if I became a moderately good trader, I could make qualified and informed decisions. I opened up a Scottrade account, and as they say, the rest is history.

Panama Canal Cruise 2008-09

Travel Dates: November 18, 2008 – December 3, 2009
Ship: SilverSeas Silver Shadow

Nov 18 2008    Tue    Los Angeles, California
Nov 19 2008    Wed    Day At Sea
Nov 20 2008    Thu    Day At Sea
Nov 21 2008    Fri    Puerto Vallarta, Mexico
Nov 22 2008    Sat    Day At Sea
Nov 23 2008    Sun    Acapulco, Mexico
Nov 24 2008    Mon    Day At Sea
Nov 25 2008    Tue    Puerto Quetzal, Guatemala
Nov 26 2008    Wed    Day At Sea
Nov 27 2008    Thu    Day At Sea
Nov 28 2008    Fri    Panama Canal, Panama
Nov 29 2008    Sat    Cartagena, Colombia
Nov 30 2008    Sun    Santa Marta, Colombia
Dec 01 2008    Mon    Day At Sea
Dec 02 2008    Tue    Day At Sea
Dec 03 2008    Wed    Fort Lauderdale, Florida

To view all of my pictures you must first have an account on Flickr (free) and then be tagged as a “friend”. Click here if you would like to see all of my sets and here if you would like to see just the Alaska photos.

Alaska Cruise and West Coast Train Trip 2008

Travel Dates: July 12 – July 28, 2008

July 13 2008   Sun   San Francisco, California  6:00 PM
July 14 2008   Mon   Day At Sea
July 15 2008   Tue   Victoria, British Columbia   3:00 PM  7:00 PM
July 16 2008   Wed   Day At Sea
July 17 2008   Thu   Sitka, Alaska   2:00 PM  7:00 PM
July 18 2008   Fri     Juneau, Alaska   8:00 AM  10:00 PM
July 19 2008   Sat    Skagway, Alaska   8:00 AM  7:00 PM
July 20 2008   Sun   Cruising Sawyer Glacier
July 21 2008   Mon  Wrangell, Alaska   8:00 AM  4:00 PM
July 22 2008   Tue   Cruising The Inside Passage
July 23 2008   Wed   Vancouver, British Columbia   8:00 AM
July 23 2008   Wed   Vancouver, British Columbia   -  Hyatt Regency Hotel
July 24 2008   Thu    Board Train to Seattle
July 25 2008   Fri      Seattle, Washington  -  Hotel Vintage Park
July 26 2008   Sat     Seattle, Washington  -  Hotel Vintage Park
July 26 2008   Sun    Board Amtak “Coast Starlight” for trip to San Diego
July 27 2008  Mon   Train
July 28 2008  Tue    Train arrival in San Diego

To view all of my pictures you must first have an account on Flickr (free) and then be tagged as a “friend”. Click here if you would like to see all of my sets and here if you would like to see just the Alaska photos.

Las Vegas & Jersey Boys!

It’s May 2008 and the opening of Jersey Boys at the Palazzo Hotel and Casino in Las Vegas. The show is as good as ever and sure to run a long time. Also took a side trip to Hoover Dam. Here are some pics of Vegas, Hoover Dam and Jersey Boys opening and after party.

Click on the individual picture to view larger image or on teh link below to see them all.
http://www.flickr.com/photos/warrenkendrick/sets/72157604918767201/

 

 

Where Have All The Leaders Gone?

The following has been verified to come from Lee Iacocca. The excerpt is from his book titled “Where Have All the Leaders Gone?”  Released in 2007.

‘Am I the only guy in this country who’s fed up with what’s happening? Where the hell is our outrage?  We should be screaming bloody murder. We’ve got a gang of clueless bozos steering our ship of state right over a cliff, we’ve got corporate gangsters stealing us blind, and we can’t even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, ‘Stay the course’

Stay the course?  You’ve got to be kidding.  This is America, not the damned ‘Titanic’.  I’ll give you a sound bite: ‘Throw all the bums out!’

You might think I’m getting senile, that I’ve gone off my rocker, and maybe I have but someone has to speak up.  I hardly recognize this country anymore.

The most famous business leaders are not the innovators but the guys in handcuffs.  While we’re fiddling in Iraq, the Middle East is burning and nobody seems to know what to do.  And the press is waving ‘pom-poms’ instead of asking hard questions.  That’s not the promise of the ‘ America ‘ my parents and yours traveled across the ocean for. I’ve had enough.  How about you?

I’ll go a step further.  You can’t call yourself a patriot if you’re not outraged.  This is a fight I’m ready and willing to have. The Biggest ‘C’ is Crisis !

Leaders are made, not born.  Leadership is forged in times of crisis.   It’s easy to sit there with your feet up on the desk and talk theory.  Or send someone else’s kids off to war when you’ve never seen a battlefield yourself.  It’s another thing to lead when your world comes tumbling down.

On September 11, 2001, we needed a strong leader more than any other time in our history.  We needed a steady hand to guide us out of the ashes.  A Hell of a Mess So here’s where we stand.  We’re immersed in a bloody war with no plan for winning and no plan for leaving.  We’re running the biggest deficit in the history of the country.  We’re losing the manufacturing edge to Asia, while our once-great companies are getting slaughtered by health care costs.  Gas prices are skyrocketing, and nobody in power has a coherent energy policy.  Our schools are in trouble.  Our borders are like sieves.  The middle class is being squeezed every which way these are times that cry out for leadership.

But when you look around, you’ve got to ask: ‘Where have all the leaders gone?’  Where are the curious, creative communicators?  Where are the people of character, courage, conviction, omnipotence, and common sense? I may be a sucker for alliteration, but I think you get the point.

Name me a leader who has a better idea for homeland security than making us take off our shoes in airports and throw away our shampoo?  We’ve spent billions of dollars building a huge new bureaucracy, and all we know how to do is react to things that have already happened.

Name me one leader who emerged from the crisis of Hurricane Katrina.   Congress has yet to spend a single day evaluating the response to the hurricane, or demanding accountability for the decisions that were made in the crucial hours after the storm.

Everyone’s hunkering down, fingers crossed, hoping it doesn’t happen again. Now, that’s just crazy.  Storms happen.  Deal with it.  Make a plan. Figure out what you’re going to do the next time.

Name me an industry leader who is thinking creatively about how we can restore our competitive edge in manufacturing.  Who would have believed that there could ever be a time when ‘The Big Three’ referred to Japanese car companies? How did this happen, and more important, what are we going to do about it?

Name me a government leader who can articulate a plan for paying down the debit, or solving the energy crisis, or managing the health care problem. The silence is deafening.  But these are the crises that are eating away at our country and milking the middle class dry.

I have news for the gang in Congress.  We didn’t elect you to sit on your asses and do nothing and remain silent while our democracy is being hijacked and our greatness is being replaced with mediocrity. What is everybody so afraid of?  That some bonehead on Fox News will call them a name?  Give me a break. Why don’t you guys show some spine for a change?

Had Enough?
Hey, I’m not trying to be the voice of gloom and doom here.  I’m trying to light a fire.  I’m speaking out because I have hope I believe in America.  In my lifetime I’ve had the privilege of living through some of America’s greatest moments.  I’ve also experienced some of our worst crises: the ‘Great Depression’, ‘World War II’, the ‘Korean War’, the ‘Kennedy Assassination’, the ‘Vietnam War’, the 1970s oil crisis, and the struggles of recent years culminating with 9/11.  If I’ve learned one thing, it’s this: ‘You don’t get anywhere by standing on the sidelines waiting for somebody else to take action. Whether it’s building a better car or building a better future for our children, we all have a role to play.  That’s the challenge I’m raising in this book.  It’s a call to ‘Action’ for people who, like me, believe in America.  It’s not too late, but it’s getting pretty close.  So let’s shake off the crap and go to work.  Let’s tell ‘em all we’ve had ‘enough.’

Bill Gates Didn’t Say It

There is a list of 11 points is often attributed in Internet emails as a speech Bill Gates made to a High School or College class. Often misattributed and somewhat altered piece is actually the work of Dr. Charles J. Sykes from the book Dumbing Down Our Kids: Why American Children Feel Good About Themselves But Can’t Read, Write, or Add (St. Martin’s Press, 1995). Dr Sikes hit the nail on the head and considering it was published in 1995, we are just now beginning to see the results of our educational and political ideology.  Three additional thoughts are generally omitted so I added these to the bottom.

Rule 1. Life is not fair-get used to it!

Rule 2. The world won’t care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.

Rule 3. You will not make 40 thousand dollars a year right out of high school. You won’t be a vice-president with a car phone-until you earn both.

Rule 4. If you think your teacher is tough-wait till you get a boss. He doesn’t have tenure.

Rule 5. Flipping burgers is not beneath your dignity. Your grandparents had a word for burger flipping-they called it opportunity.

Rule 6. If you mess up-it’s not your parent’s fault-so don’t whine about your mistakes-learn from them.

Rule 7. Before your were born-your parents weren’t as boring as they are now. They got that way from paying your bills-cleaning your clothes-and listening about how cool you are. So before you save the rain forest from the parasites of your parents’ generation-try delousing the closet in your own room.

Rule 8. Your school may have done away with winners and losers-but life has not. In some schools they have done away with failing grades and they’ll give you as many times as you want to get the right answer. This doesn’t bear the slightest resemblance to anything in real life.

Rule 9. Life is not divided into semesters. You don’t get summers and Christmas break off-and few employers are interested in helping you find yourself. Do that on your own time.

Rule 10. Television is not real life. In real life people actually have to leave the coffee shop and go to jobs.

Rule 11. Be nice to nerds-chances are you’ll end up working for one.

The following are those usually omitted:

Rule 12. Smoking does not make you look cool. It makes you look moronic. Next time you’re out cruising, watch an 11-year-old with a butt in his mouth. That’s what you look like to anyone over 20. Ditto for “expressing yourself” with purple hair and/or pierced body parts.

Rule 13. You are not immortal. (See Rule No. 12.) If you are under the impression that living fast, dying young and leaving a beautiful corpse is romantic, you obviously haven’t seen one of your peers at room temperature lately.

Rule 14. Enjoy this while you can. Sure parents are a pain, school’s a bother, and life is depressing. But someday you’ll realize how wonderful it was to be a kid. Maybe you should start now.