Investing

  • Principles
    • To have an advantage in investing you need one of 3:
      • Informational advantage
      • Analytical advantage
      • Behavioral advantage
    • Can borrow against money you have in accounts (retirement accounts, accounts with interest) at an LTD rate. How Ryan Moran got his tesla for free.
    • Sep IRA for greater contribution limits than Roth, if self employed.
    • Legally you can put money in IRA and convert to Roth IRA as a loophole if you make over the Roth income threshold.
  • Investing
    • Best public investment is dividend paying stocks that have increased their dividend over the past 25 years.
    • Yep, Apple has been buying up U.S. debt using its foreign funds, to earn interest on its profits, rather than pay it.
      How does that work? It’s all thanks to a loophole in America’s tax code that exempts companies from paying income tax on any money invested in Treasuries (like bonds).
    • Backdoor IRA Loophole: Can put into regular IRA and then move into a Roth IRA if you make too much money and the  tax implications of the same.
    • Can take principal (not interest) out of Roth IRA anytime without penalty. Always invest first 5500 into Roth for this reason.
    • For dividend investing, one strategy would be to screen the Berkshire Hathaway dividend stocks that have increased over 20 years, so you’re getting the best of the best.
    • Cash Flow / Dividends
      • REITs are good investments as they produce good dividends. AGNC is a good choice as it pays a monthly dividend of 1% (ideal rate) plus you get the appreciation that would normally happen in the market. Other good choices: UHT, NLY, TWO.
      • Stocks that pay dividends and their dividends have increased in the past 10 years. Options: Target, ATT, Walgreens, IBM
    • Vanguard started as a non profit and has the lowest expenses to own their funds.
    • Vanguard Admiral funds are lowest cost Index funds that have ETF equivalents. Better to buy index fund though if you can afford minimum to avoid bid-ask spread/loss.
    • Vanguard: ETFs pay dividends and can reinvest or not just as Index. ETF takes 3 days to get cash out, mutual/index funds take 1 day.
    • Best time to buy funds/stock is in September and October. Worst is before April 15.
  • Funds
    • Here are some of the top “green funds” that Bach suggests researching:
      •Calvert Funds is one of the largest active managers of SRI mutual funds, offering both index-based and actively managed socially conscious funds. Calvert Large Cap Growth Fund [symbol: CLGAX] has outperformed the S&P 500 over the last five years.
      •Launched in 2001, Winslow Green Growth [symbol: WGGFX] is annually the best performing green fund over the past five years. This small-growth fund invests in domestic companies that that are either in specific green sectors or have shown strong environmental responsibility. Its creators are about to launch a second green fund, called the Winslow Green Solutions Fund.
      •Founded in 1982, The New Alternatives Fund [symbol: NJALFX] holds companies—both overtly green and less visibly so—that it believes “have a positive impact on the environment.” Many of its holdings are in the renewable-energy space, but it also invests in natural foods companies (like Whole Foods) and those involved in clean water and clean air.
      •Green Century Funds manages two green funds. Started in 1991, they offer the Green Century Equity Fund [symbol: GCEQX] and Green Century Balanced Fund [symbol: GCLBX]. Both funds seek to track the Domini 400 Social Index Fund, which screens out companies involved in socially or ethically unacceptable areas (alcohol, tobacco, firearms, etc.) and screens in companies with positive environmental, social and governance (ESG) performance. Green Century is nonprofit and promises that its fees and profits are used to preserve and protect the environment.
      •Powershares Wilderhill Clean Energy [symbol: PBW] is an exchange-traded fund (ETF) that focuses on companies that promote cleaner energy. Founded in March 2005, the fund seeks to mirror the Wilder Hill Clean Energy Index. Other “green” ETFs currently available include WilderHill Progressive Energy Portfolio [symbol: PUW], which focuses on companies that that provide technologies that improve the use of existing fossil fuels, PowerShares Cleantech Portfolio [symbol: PZD], Claymore/LGA Green ETF [symbol: GRN], Van Eck Global Alternative Energy ETF [symbol: GEX] and First Trust NASDAQ Clean Edge ETF [symbol: QCLN].
  • Software / Services
    • Smartmoneyfinancialgroup.com
    • Wealthfront.com: low-cost investment/automated portfolio management
    • FreshBooks for simplified invoicing and expensing for small businesses. Accounting Software.
    • GoDaddy Bookkeeping for automated revenue and expenses for small businesses.
    • –GoDaddy: Personal finances used to be a huge drag and time-suck for me, so up until I recently decided my finances were so complex that I needed to hire a personal accountant to track everything in Quickbooks, I used GoDaddy Bookkeeping. It pulls all my small-business and personal finances into one place and takes care of all my bookkeeping so I can skip spreadsheets, data entry, and having piles of paper everywhere. Any purchase I make from a credit card or bank account goes straight into GoDaddy, all by itself. And you can share your GoDaddy account with an accountant, so your taxes can be easily prepared. A
    • Use a virtual accountant from Bench.co
    • Real Estate

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