Saturday, September 7, 2013

No sir, I don't like it.



This week we decided to take a more thorough look at some investments with a pro/con/etc analysis. These are some investments from our friend's portfolio. This project will probably take a while, since we aren't likely to spend hours and hours doing this in one day, especially due to the fact that we get off topic pretty easily. 

Fund/Stock
Pros
Cons
Good/Bad?
BCE

*Communication services in Canada
5.4% Dividend Yield

Low beta (0.41), which means it, is less volatile than the market.

Fairly far below the 200 DMA.

Canadian—you may recall when the US market collapsed Canada was more stable.


Communications stock (our portfolio is heavy in this sector).

Québécois




It is an unusual frontier for our investment. Canada is geographically very close to us, however they do things a bit differently than here in the US.
CEO

*International oil exploration, development, productions, and sales. Based primarily in East Asia
Decent dividend yield (2.9%)


It’s an oil company
(i.e. planet vampire)
More volatile than the market (Beta 1.48)


When we took a look at these two, CEO is definitely not something that fits into our current investment strategy and interest. That means that we can rule it out, and move on to comparing other stocks. We were going to take a look at COP (Conoco Phillips) but it is really similar to CEO, so we can eliminate it without going too much further. Also there’s CPL (a Brazilian electric company), which by its very of nature of being Brazilian is a no go, because EWZ has burned us so very much. No more Lusitanian stocks. Perhaps by doing this sort of analysis we will become more adept at choosing the sort of investments that work for us right now. Although this is a slow process, it seems useful in the long term. At some point in time maybe we can pick investments a little more quickly and confidently.

When we were taking a look at the beta of each stock, we realized that a higher beta might not necessarily be a bad thing. It just depends on what we are looking to do. If we are looking for a dividend investment, we want the value of the stock to stay pretty stable in comparison with the whole market. However, if we are looking to make a profit based on stock price, too low a beta might not get us anywhere.


For next week, we will continue looking at some more investment opportunities:



EXC                
FTR
GE
GILD
GSK
TDC
TD
VMC
AWF
MCLOX
FIF
HFQCX
LFMCX
LCSCX
UTG
SPY
TSDOX
IGTCX



Profit!




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