I've posted the pdf version of an article that everyone who has money should read. Seriously. It is absolutley timeless and will help you decide how to intelligently handle your investments throughout your life. This article will create value for you by providing you the mental framework to an intelligent investing approach and in turn give you confidence in your approach.
Warren Buffet has proven that he is simply the best at investing. As it is in any field, we should always study the best to learn from their great successes. There is absolutley no need to try to re-invent the wheel. Read this article and enjoy the simplicity of what you will learn. It will take the fear out of investing.
Listed below are our sample portfolios which we welcome you to folow for free. They are intended for demonstrative purposes. These portfolios will provide an insight as to our preferred methodology in achieving intelligent investment returns. The tactics, and therefore the returns, can and should be adjusted for your specific goals and investment comfort levels. One portfolio is for US listed securities and one for Canadian listed securities. Each began with $100,000.00 CAD, meaning at the time of inception on November 23, 2011, the USD portfolio was valued at $95,370.00 USD based on the Bank of Canada closing rate of $1.0485 USD/CAD.
We post these portfolios here for your review, to demonstrate the effects of our stock selection and hedging strategies through the various market conditions over time.
Current portfolio statements:
Like the results of what you see in our practice portfolios? Interested in benefitting from a similar approach for your portfolios? We can help you with that, so let's talk.
I have been struggling with how to proceed with the practice portfolio’s going forward.The challenge has been that for the Canadian portfolio, the options market is not as liquid as I need as my current program relies on actual trade executions to fill m ‘practice’ orders.I’ve been relying on actual orders because my goal is to produce a verifiable portfolio rather than one base on hypothetical orders.I am looking at tracking portfolios based on end of day bid/ask quotes as that information is relatively easy to verify.If you have other suggestions, feel free to tell me what you think would be reasonable in the circumstance.
I’ll make a decision soon and get this back on the site.
I know I’ve been very quiet lately but as I mentioned, I was
out of town and I had very limited internet access. And yes there are places in
the world like that!Anyway, I’ve posted
the end of the month portfolio statements.
You will notice that there is virtually no hedging in place
and that’s by design.A lot of my previously
hedge positions were offside and that was tell me that values were bidding bid
up as it seems that investors are ready to be buying now. My current strategy
is to leave most positions unhedged, temporarily and allow a little more equity
to build up in the portfolio.This is
like the captain of a ship deciding to bring in the oars and hoist the sails as
he notices a gentle wind blowing in his favour.
I want to remind you
all that your equity option contracts expire at the end of this week.That means you need to make some decisions
regarding follow up actions on your positions.Survey your choices amongst your favourite holdings and decide what you
want to do with them.If, as I suspect
is likely, you believe that they are good value investments paying you
dividends then you will take actions to hold onto them.So if your options are in-the-money then place
a ‘buy to close’ order and roll out to another calendar series that suits your
goals and collect the new premium. Naturally, if the options you sold short are
out-of-the-money then you need do nothing at all.Simply let them expire and you can establish
new positions on or after the Monday, if you so chose.
One common question
about closing out option positions is the proverbial ‘when is the best time’?The answer is actually simple.In general, the right time to close out a
position is when there is no time premium left and the contract trades at it’s
intrinsic value. This is because as a option writer, one of the main things you
are selling a buyer is time.Therefore, when
the time premium has disappeared, it is a good time for a new sale of more time
If you need some help with this then drop us a line!
So, no sooner do I write that there won't be frequent updates and then I have one! I love life's irony's. I have made one addition this morning to the CAD portfolio; Buy 400 CPX @ $25.21. Now, if you are following along then I would recommend to; Sell CPX Feb 26 Call @ $0.60. I have put that very order in but there is currently no option volume on that series and since this is a practice portfolio and the program uses historic data, I have no way to execute the transaction. I need a real time transaction to occur in order to register a transaction in the practice account.
I will use this space to update you on the changes to each portfolio as they occur. That said, you shouldn't anticipate daily updates because our style does not require that many changes.As we hedge virtually all of our positions with options, you can expect changes on and around the third Friday of each month when option contracts expire.
I will also use this space to give you commentary on developments and news stories regarding our existing portfolio holdings.This will hopefully give you an understanding into what I believe makes for intelligent investing.