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Random investment ideas
Old 06-16-2005, 08:56 AM   #1
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Random investment ideas

Ok people nothing too solid here but just a few thoughts.

1) Japan (as crappy as it has been for years) is one of the cheapest darn stock markets in the developed world. Read some decent reports on some changes in management/companies/economy. Is it time to add to the Pacific Index or weight it a bit more?

2) Small cap value/growth abroad (and here I guess) from what I have seen in a lot of MF's are trading at about the same or higher valuation as large values. We should pay less for the risk if you ask me. The large foreign value's portfolio I am in is trading @ 14 times this yr's earnings. Not too bad and maybe even a bit more attractive relative to other plays & even better if the dollar drops for unhedged funds.

3) Nords revisited the "Dogs of the Dow" idea a couple weeks back. Instead of picking the top yielders how bout focus on the highest yielders that have actually grown the dividends lately. The top yielders have not grown the divis at all and in some cases will cut the divi. So maybe""Dogs of the Dow" on steroids for the slice and dice portion of the portfolio.





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Re: Random investment ideas
Old 06-16-2005, 09:34 AM   #2
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Re: Random investment ideas

I think 1 might be a good idea for currency reasons alone.

There is a strategy called "Small Dogs of the Dow" which calls for buying the lowest priced five of the 10 highest yielding stocks of the DJIA at the end of the year. Looks good on paper, but it may just be fitting a system to the data. If you have more interest see Dogsofthedow.com
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Re: Random investment ideas
Old 06-16-2005, 11:31 AM   #3
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Re: Random investment ideas

Quote:
Originally Posted by wildcat
Ok people nothing too solid here but just a few thoughts.

1) Japan (as crappy as it has been for years) is one of the cheapest darn stock markets in the developed world. Read some decent reports on some changes in management/companies/economy. Is it time to add to the Pacific Index or weight it a bit more?
I did last year. On the other hand japans stock market has been one of the 'cheapest' for a long time now, and not all the reasons for that have or will be resolved.

Quote:
I have seen in a lot of MF's
Watch your language young man!

Quote:
3) Nords revisited the "Dogs of the Dow" idea a couple weeks back. Instead of picking the top yielders how bout focus on the highest yielders that have actually grown the dividends lately. The top yielders have not grown the divis at all and in some cases will cut the divi. So maybe""Dogs of the Dow" on steroids for the slice and dice portion of the portfolio.
Or take something like vanguards dividend income fund for its ~3% dividend yield and get a broad based footing in this with less volatility and probably the same approximate yield. Same stock pickers as wellesley and wellington, by the same model.
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Re: Random investment ideas
Old 06-16-2005, 02:12 PM   #4
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Re: Random investment ideas

Don't much like Japan at this point, but I think a chunk of your cash should be out of country.
My current favorites--
Canada* oh Canada: ETF symbol EWC or Fidelity has a nice fund symbol FICDX.
Like the emerging markets also.* Right now I'm using the Vanguard index.
One note on Canada--if you think oil is coming down soon and hard, wait til then to go for Canada.
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Re: Random investment ideas
Old 06-16-2005, 05:15 PM   #5
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Re: Random investment ideas

Tweedy, Browne's semi-annual report says that rarely have valuations been so in synch. In effect the market is farily priced, so they've closed both their funds, they're selling stocks that reach their valuations, and they're sitting on something like 19% cash (highest I can ever remember).

They mention that they're buying Korea (south of the DMZ). They're finding single-digit P/Es. Most of their investments are still in the Netherlands & Switzerland but they've also been buying Japan over the last couple years.

They're interested in China but they feel that the govt still has too much power over the market and its companies. Apparently that's a different situation than the U.S. market?!?
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Re: Random investment ideas
Old 06-16-2005, 05:53 PM   #6
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Re: Random investment ideas

Nords -

Yeah nothing is real cheap* * but I suppose I was trying emphasize the cheapest.* Intl' large value and domestic large value to me are the two best plays.* Small caps seem pricey to me, even small value tilted MF's (excuse me TH* )

As for Korea, there is always Korea Electric Power which is not expensive but has made a nice run.* Forward P/E still fairly low and if currency appreciates vs. the dollar there could be a base hit.

I was reading some info on some global REIT plays but apparently the US's market is not as hot as others overseas*

China IMHO needs a better system to really take off in terms of stock market.* I think the Pac Index is a good play on a cheap Japan and other countries that will benefit from China's growth, i.e Australia's stock market the last 3 yrs*

Nords can't hog all the information - read
* http://www.marketwatch.com/news/yhoo...40A47031596%7D
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Re: Random investment ideas
Old 06-17-2005, 01:34 AM   #7
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Re: Random investment ideas

Quote:
Originally Posted by wildcat
Nords can't hog all the information - read
* http://www.marketwatch.com/news/yhoo...40A47031596%7D
Good interview-- I missed it the first time. That came out nearly six weeks before I got the mailed report, and the interview reads like they were test-driving it before they mailed it.

I'm pretty confident that Tweedy has a couple hundred Chinese stocks on their watch list, no matter how much they went to great pains to bad-mouth the investor's climate...
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Re: Random investment ideas
Old 06-17-2005, 06:14 AM   #8
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Re: Random investment ideas

I have some Tweedy Browne Global Value and just read the first Q report last night - I think the cash is up to 21 or 23%, something like that. They say they can't find good things to invest in. But what disturbs me is that their expense ration is like 1.3% - so I'm paying 1.3% for them just to hold my cash?

Dave
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Re: Random investment ideas
Old 06-17-2005, 07:36 AM   #9
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Re: Random investment ideas

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They say they can't find good things to invest in. But what disturbs me is that their expense ration is like 1.3% - so I'm paying 1.3% for them just to hold my cash?
Stinks but the payback comes if they are able to buy up cheap equities down the road and returns increase as a result. Good value investors practice patience.
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Re: Random investment ideas
Old 06-17-2005, 10:37 AM   #10
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Re: Random investment ideas

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Originally Posted by LakeRat
But what disturbs me is that their expense ration is like 1.3% - so I'm paying 1.3% for them just to hold my cash? Dave
Yep-- 1.37%, although it's gone as high as 1.39%.

Part of that is the cost of hedging the dollar and part of that is the cost of buying & selling overseas. It's a lot more expensive than the ETF (EFA) and probably more expensive than other global/international funds (like Third Avenue's TAVIX). Let us know if you find a better performer with cheaper expenses-- especially if it's still open!

It hurts deeply to admit that this is one of those instances where we're willing to pay for active management. (It's hard to look at their photos and imagine these guys living an Amerindo lifestyle.) I love their letters & papers and I learn a lot from their analysis examples. Their "separate account" literature is even more interesting (although their private-account management is more expensive as well). So far the long-term performance-- without the currency swings-- appears to justify the expenses.

Another issue is that we've been DCA'ing since 1996 at share prices down in the $14-$15 range so about a third of our account value is unrealized cap gains.

But it's our last mutual fund and it's the one that we're drawing down first in retirement. We're still trying to decide if it's worth moving our IRA shares into EFA or something cheaper...
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