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Mar 6, 2009 3:35 am

De nada.

Use your power for good.
Mar 7, 2009 11:20 pm

.

Mar 8, 2009 12:52 am
gvf:

Put 50% into a good etf-based annuity.  Get one that guarantees to double in 10 years and take the payout.  Worried about beneficiaries? Put 50k into a SUL policy.  At his age, could probably buy 1-1.5mil.  If he doesn’t have a pension, put 10-20% in one of those deferred payout annuities, make it start at age 65-70, you can get a nice IRR depending on his longevity.

Lots of ways to stay in the market and have some nice numbers for worst-case scenarios. 

"Guarantees to double in 10 years"  WTF are you talking about? If Hartford were to go BK, annuity holders will get their investment value, not one penny of the guaranteees.  How do you think anything is guaranteed with equity annuities?  Because they told you so?
Mar 8, 2009 1:33 am

Sorry to be fast and loose with my words fritz.

I assumed people would interpret that as the “double the withdrawal value in 10 years” feature. 

I do not use Hartford annuities.


Mar 9, 2009 9:46 pm

I got two account today, one 500 ish the other 200 ish, both in cash and both will be used to write cash secured puts.

Mar 10, 2009 2:43 am

do people still use loaded funds?  can’t comprehend why one would buy one…

  put 100% in neuberger all cap separate a/c.  fully liq and blows away the market 1,3,5,10 years.  book some profits when s&p hits 1000 by year end and buy muni cefs with 40% to offset the socialist tax plan   for those questioning s&p 1000: at 0% interest rates, market should trade at 20x earnings. that stimulus will contribute to earnings which is now conservatively forecast around $50.      
Mar 10, 2009 3:17 am

i cant believe the fear of good ole equity investing at these prices, reps and clients alike have lost their minds

  Just awesome for those who are continuing to buy
Mar 10, 2009 9:02 pm

[quote=Ron 14]i cant believe the fear of good ole equity investing at these prices, reps and clients alike have lost their minds

  Just awesome for those who are continuing to buy[/quote]   Why cant you believe it? Most people's retirement accounts have been halved if they are lucky. Most brokers, that are managed money drones, are walking around in a daze.   I'm not saying don't buy because I am BUT you better know how to hedge before you jump in the fray.
Mar 11, 2009 12:59 am

Almost every single advisor claims the options portion of the 7 is the hardest. 99.9% of advisors aren’t using them because A. they dont understand them and B. they dont have the time to stare at a screen and make appropriate trades at the right prices because they are meeting with clients and prospecting. If you are lifting bids and offers or placing limit orders you are getting your face ripped off by the professionals on the trading floor. I know this because I stood in the pits for 10 years. Why hedge when you dont need to ? Pick up a Nick Murray book, find a quiet place to read it and stop trying to find fancy ways to create commissions.

Mar 11, 2009 11:19 pm
Ron 14:

Almost every single advisor claims the options portion of the 7 is the hardest. 99.9% of advisors aren’t using them because A. they dont understand them and B. they dont have the time to stare at a screen and make appropriate trades at the right prices because they are meeting with clients and prospecting. If you are lifting bids and offers or placing limit orders you are getting your face ripped off by the professionals on the trading floor. I know this because I stood in the pits for 10 years. Why hedge when you dont need to ? Pick up a Nick Murray book, find a quiet place to read it and stop trying to find fancy ways to create commissions.

  Don't know about you but I've been making very good money for my clients doing just that. I was a prop trader before going retail as my wife got pregnant and I needed something a little more stable. SO you were in the pits for ten years and would rather put somebody in a mutual fund or some such??? If you cant properly hedge in this market you are in cash or dead. If you could know beforehand what needed to be hedged and what didn't need hedging you would be the King of Siam. But here you are with the rest of us saying things that are a notch above stupid. .   NOW THAT'S FUNNY!!!!!   That fact that you suggest people are concocting strategies as if they are simply a fancy way of churning is a REFLECTION OF YOU NOT US.   PS I'm 19 months into this gig and am presidents club production. All of my clients were from cold calls and referrals. Funny thing they don't teach at stock broker school... make a lot of money for a millionaire or two and you do well. Make money for the same employing a hedging technique through a market crash will have more business than you can handle.   Guess what .... I ALSO GO SHORT !!!! Does that make me the devil in your book?
Mar 12, 2009 3:33 am

You are not the devil for going short and you are not the devil for doing options.

I guess I will stay old school with my buy and hold and rebalance and reinvest strategy and like a prospect told me today, continue to live in the 1930's.
Mar 12, 2009 4:59 am

This has been a good thread.  I like the zero and invest the rest in equities strategy.  I would tend to agree with Ron’s thinking that 10 years from now, you are going to be better off in equities than anything else.  My approach has always been tactically allocating portfolios.  If I’m going to leave bonds out of the allocation, I’m probably going 20-25% of the portfolio in alternative type of investments like 5% in Gold, 5% Mgd Futures, 5% Multi-Strat Hedge Fund or Mkt Neutral Fund, 5% in MLPs and probably just a straight 5% in the SH (Inverse S&P 500).  For a $200k client, you can access all of those investments with either open-end MF, closed-end MF or ETFs.  This is not a static allocation which means I will dump that Inverse fund at some point and adjust the overall allocation over time.  This type of portfolio probably has a beta compared to the S&P of somewhere in the .50-.60 range and I feel like a 7-8% return of the next 10 years is quite possible.  Best part, you are being fare to charge the client 1.25% annual fee for the management of this portfolio and I feel confident that I will be adding value.

Keep in mind, in the past 180 years, whenever the rolling 10 year return on large cap stocks has been this low (4-5 other times), the average return from here 10 years later was 13.5% with the worst 10 year being 7.5% and the best being something like 18%.  That includes the Depression time period.

Mar 12, 2009 1:40 pm

mrclutch, I like that strategy. On one hand I think it makes sense to try “non-traditional” choices but on the other hand I dont want to get caught up in the “this time is different” and overthink things. Ive worked at Jones and a Bank so “non-traditional” investments arent exactly welcomed.

Mar 12, 2009 9:31 pm

Hell, I’ll agree to the the ten year gig, maybe, but what about those who were on the edge and the asset allocation model blew up? I think one needs to be much more nimble in this brave new world. When you’re down 50% you need a 100% gain to break even. As I’ve said before buy and hold is now buy and hedge. I’ve saved my clients huge amounts of money by shorting against the box the day before earnings. Never mind selling options to get into and out of positions (without a specific agenda buying options is a fools bet). I don’t take a trade unless I have an 85% chance of success. On any one trade that means nothing but in the larger sample that’s 9 out of ten wins, not a bad edge.

  What's the best producing asset class in the last decade????????????   TREASURIES  Time to rethink things IMHO
Mar 12, 2009 9:56 pm

show him the sp500 annual returns for the last five years. If he gives you $200k to invest in 2014 he’ll have $172,983, and by the time he retires that should be about $23,946.

Mar 12, 2009 10:26 pm
MinimumVariance:

show him the sp500 annual returns for the last five years. If he gives you $200k to invest in 2014 he’ll have $172,983, and by the time he retires that should be about $23,946.

  To further your thought, since the past is soooo predictive of the future, just show him the returns of the inverse S&P over the last ten years and recomend that.
Mar 13, 2009 3:10 am
What's the best producing asset class in the last decade????????????   TREASURIES  Time to rethink things IMHO[/quote]     That is exactly why we dont have to rethink things, Treasuries are not going to go back 2 back as the best producing asset class.
Mar 13, 2009 4:55 am

I saw a portfolio from a prospect a couple weeks ago.  All AF and Putnam.  The usual suspects.  CIB, CWGI, EPacG, GFA, Boston, some other Put G&I funds, down (according to client) 50% last year.  A cursory look at the funds returns, this is in the ballpark.  I think Ice is 100% correct, if you have clients in the situation he described down anywhere close to 50%, you should invite them to leave cause you ain't doin your job.

Mar 13, 2009 8:42 pm

For the record I didn’t say anything about a person being down that much, none of my clients are even close. My best account that let me and help me do my thing were up 19% from April 08 to Jan 1. My point was just what I said, if your down 50% you need a 100% gain to break even. For those that bought and hid there are plenty of things that are down like that. Lets say I think it’s called investment club of America. I got rid of the equity mutual funds in my accounts at 8000. Didn’t feel good but I’m glad I did now. If I had not there is a very good chance they would be down 50% in the  last 12 months.

Mar 13, 2009 8:53 pm

[quote=Ron 14]

What's the best producing asset class in the last decade????????????   TREASURIES  Time to rethink things IMHO[/quote]     That is exactly why we dont have to rethink things, Treasuries are not going to go back 2 back as the best producing asset class. [/quote]   You rock on with that thought "Treasuries are not going to go back 2 back as the best producing asset class" you sure are able to make assumptions about the future. Same thing with your hedging comments. The only thing I know for certain is I have no idea whatsoever what tomorrow will bring. If you stay with the strategies that have broken even at best over the last decade, good luck. I'll not repeat the mistakes of the past if I can help it. I'm not one of the smartest guys in the world ... thank God.   You're the guy that spent ten years in the pits? Sure don't sound like any of the traders I've known.