Little about myself... I'm not an avid trader, I have no winning strategy or holy grail. I am better at preserving capital. I love my job i'm an ironworker in nyc and I work hard for my money. In my free time I read and study about trading and the economy. I took a night class in economics. 28 years old. I have an account with IB and went from 11k to 7k in about 5 months trying to trade the es then cut myself off. 4k taught me alot! I have about 50k in savings and I was planning on buying a multifamily house as an investment. I'm trying to see what my options are for a good investment with low max drawdown and better than 5% return. No matter what it may be. I have a good knowlege on how the markets work, have experience trading options, stocks, futures... yet I really don't have a viable strategy. My question is if you had 50k and were to put it somewhere to generate some sort of income better than a cd yet relativley safe what would it be? realestate, low beta/high dividend stocks, conservative options strategy, bonds... etc??? whats your opinion?
You come across as a sensible guy, and are not deluded by the offers of 100% + returns on offer. Unless you have an edge good old fashioned advice works best. My advice is to buy Index ETF over time, say $2k a month, and let the compounding do the work for you. As to which index's I have no clue. Mickson
Keep at it, make a strategy that is profitable and stop trading real money until it is. It is totally worth your time and energy.
lol Funny! I also took the 5k burner lesson on trading Welcome to the wonderful world of speculative/technical trading. As for a solid investment, I think real estate is starting to look interesting. Although this new Lehman Bros. news seemed to have opened another can of worms on the market, my unfounded speculative guess is that we are nearing the bottom of this cycle - and I can't imagine real estate blowing up further. The only thing I could see further deteriorating real estate is credit card debt. I believe (and know a few) that have basically survived the rough waters so far by tapping into their credit lines/cards. Once that credit starts to dry up and the defaults start to spread, it could spill over a bit to real estate. But I doubt it will be as serious as the collapse that took place earlier this year.
My parents own 10-12 rental houses. That business is a pain in the a$$. Do you really want to hunt down your rent money? And a $500 damage deposit doesn't begin to cover the amount of damage that your average idiot can do. One guy tore apart his Harley's engine in the front room & destroyed the carpeting! Sorry to rain on the parade but I get to hear them complain about the biz weekly.
I agree. Nor the people who know how to work the system and get 3+ free months out of you by telling the judge a sob story. Or the nightmare tenants who drive out your good tenants via drug dealing, loud music. Only people who have not done this longterm recommend it to others...
appreciate all the replys. I have considered alot and really thought about it. I am a little too occupied to put in the neccessary time to educate myself enough to come up with a profitable strategy right now. Thanks to Cutten, he had an informative thread on investment which is pretty much based on logic and common sense. You don't need to read a ton of books and blow up an account to make a reasonable return with minimal risk... http://elitetrader.com/vb/showthread.php?s=&threadid=125840&highlight=rebalance I have been low balling multi-family houses in decent neighborhoods here in Jersey where I live. I know of these horror stories people have and if one of these homes comes through hopefully I can avoid problems by learning from others mistakes. I plan on living in the house and renting the other which makes it easier for me to boot someone out. Also I plan on weeding out the losers by running a credit check. I will be happy if the rental income covers interest, taxes, and utilities. If thats the case and in 3 or 4 years I can manage to sell the (400K) home for at least 5% more than I bought if for I would have gained 40% on my initial 50K investment. Yet after this credit crunch/housing slump I equate speculating on future home value with the stock market. I can buy a house, collect rent and hopefully sell it for a profit in the future. I can also buy a stock, collect a dividend and hopefully sell it for a profit in the future. And if I want to make money trading who knows how much I am going to lose before I can consistently generate a reliable income. Rental income is where I think you might get a better edge. But as I am a first time buyer I have alot to learn. Thats why I am asking your opinions. Thanks again -Ray
I don't now where you should invest but here is my experience I made a bad investment buying a home in florida a few years ago. Take in cosideration the taxes you will pay for the property and the insurance. Believe me the rental income won't cover all of it with your mortgage. Doesn't Jersey have the highest home taxes in the nation? Don't buy the spyders either if you think the economy is still tanking cause that will just go down. If you do buy a home buy in a neighborhood thats popular so you can become liquid if need be. BTW all the bargains are in foreclosure