Reality Check Please

[Naam]

Personally I would guarantee 7% but i actually stated I would would expect 8.5%

i'd say in finance and investing nothing is guaranteed. unforeseen circumstances can wipe out any yield virtually overnight. that applies especially to investors who are striving to achieve 7% in a quarter instead per annum. mid of february i was up ~11.8% YTD. now i'm down to a "meager" 6.85% since jan1 (both based on USD value).

moreover, yield percentages can be quite deceiving because they depend in which currency they were achieved and expressed.

a Vietnamese who kept some US-Dollars for 4 years and 4 months under his mattress achieved a linear (not compounded) yield of 12% p.a. each year. if he had kept Dong under his mattress he would have lost in Dollar terms 12% p.a.

if an Aussie had exchanged his AUD into USD or EUR end of 2008 and put them in a cookie jar he would have made 13% p.a.

summary: yields = schmields... as my jewish friends would say

Edited April 25, 2012 by Naam

[ExpatJ]

7% is in my opinion highly achievable although I am happy to admit my views on investing will differ to most.

I would happily guarantee 7% myself averaged over a nominal 10 year period, as long as I keep the additional monies !!

The problem with inviting answers on a forum such as this (good that it generally is) is that you'll end up with more doubts and questions than you'll start with.....

Personally I would go for 8.5% return.

Thank you Chivas.

My question to you is - do you think that 7% is too optimistic given a 50% equity/50% bond split?

Yes, very, very unrealistic.

Chivas- care to tell us how you get your guaranteed 8.5% per year?

Personally I would guarantee 7% but i actually stated I would would expect 8.5%.....

So you cant tell us how you would do it?

[Chivas]

If we are referring to the 7% (or even the 8.5%) than active management ie me !!

Let me quantify that slightly and this is 100% true.

I sleep on the living room floor with the laptop on with all financial feeds 24 hours a day. I probably sleep for less than 2 hours on average in any period. The platforms go on at 22.00 on the Sunday and go off at 21.00 on the Friday......

I watch and watch and watch the markets and I invest normally on scalping but happy to let it go on a swing trade. I will quite happily sit all day and night for £20 on a trade....Doesn't faze me that the entire day has earned me £20 (don't get me wrong-I don't like it !!) but am dedicated and good at what I do.

I would happily guarantee anyone 7% averaged out !!

[12DrinkMore]

If we are referring to the 7% (or even the 8.5%) than active management ie me !!

Let me quantify that slightly and this is 100% true.

I sleep on the living room floor with the laptop on with all financial feeds 24 hours a day. I probably sleep for less than 2 hours on average in any period. The platforms go on at 22.00 on the Sunday and go off at 21.00 on the Friday......

I watch and watch and watch the markets and I invest normally on scalping but happy to let it go on a swing trade. I will quite happily sit all day and night for £20 on a trade....Doesn't faze me that the entire day has earned me £20 (don't get me wrong-I don't like it !!) but am dedicated and good at what I do.

I would happily guarantee anyone 7% averaged out !!

Bloody hell!!!!

I'd rather earn 3.4% tax free at the SCB and have a life.....

[Chivas]

If we are referring to the 7% (or even the 8.5%) than active management ie me !!

Let me quantify that slightly and this is 100% true.

I sleep on the living room floor with the laptop on with all financial feeds 24 hours a day. I probably sleep for less than 2 hours on average in any period. The platforms go on at 22.00 on the Sunday and go off at 21.00 on the Friday......

I watch and watch and watch the markets and I invest normally on scalping but happy to let it go on a swing trade. I will quite happily sit all day and night for £20 on a trade....Doesn't faze me that the entire day has earned me £20 (don't get me wrong-I don't like it !!) but am dedicated and good at what I do.

I would happily guarantee anyone 7% averaged out !!

Bloody hell!!!!

I'd rather earn 3.4% tax free at the SCB and have a life.....

Perhaps I made out that I am earning £20 every day !!! If I did my apologies.........

What I was trying to say was that I'm dedicated in what I do (but 5 day week still) but if needs must I 'll stick at it even if I was to end up with £20 for a days effort........

That rarely happens I might add.....

[12DrinkMore]

Perhaps I made out that I am earning £20 every day !!! If I did my apologies.........

What I was trying to say was that I'm dedicated in what I do (but 5 day week still) but if needs must I 'll stick at it even if I was to end up with £20 for a days effort........

That rarely happens I might add.....

No, it wasn't the GBP 20 / day;

It was the 7 to 8.5% rate of return against the number of hours spent, where in, for example, you could earn 3.5% in Thailand on a simple term deposit, or 5.5% or so in an AUD term deposit.

And in Thailand with no currency risk, sleeping on my own bed with no realtime headaches about the markets.

Yep, those extra couple of percent wouldn't be worth the sacrifice for me.

Edited April 26, 2012 by 12DrinkMore

[Chivas]

Perhaps I made out that I am earning £20 every day !!! If I did my apologies.........

What I was trying to say was that I'm dedicated in what I do (but 5 day week still) but if needs must I 'll stick at it even if I was to end up with £20 for a days effort........

That rarely happens I might add.....

No, it wasn't the GBP 20 / day;

It was the 7 to 8.5% rate of return against the number of hours spent, where in, for example, you could earn 3.5% in Thailand on a simple term deposit, or 5.5% or so in an AUD term deposit.

And in Thailand with no currency risk, sleeping on my own bed with no realtime headaches about the markets.

Yep, those extra couple of percent wouldn't be worth the sacrifice for me.

Fair play and point fully understood.......

The only thing I would add was that originally I was asked how I could guarantee 7% and again to make it clear if I was making only 7 % a year on average I would have given up a long time ago.....

Its a lot lot more than that and have just been playing with figures and they may be slightly loose 0.5% either way but am averaging 15.7% (tax free or taxes paid) over a ten year period. (Have had to average it over 8 years as that's the period of time I have been active).....

[12DrinkMore]

Fair play and point fully understood.......

The only thing I would add was that originally I was asked how I could guarantee 7% and again to make it clear if I was making only 7 % a year on average I would have given up a long time ago.....

Its a lot lot more than that and have just been playing with figures and they may be slightly loose 0.5% either way but am averaging 15.7% (tax free or taxes paid) over a ten year period. (Have had to average it over 8 years as that's the period of time I have been active).....

So essentially none of what you have posted is relevant to the OP, who I would guess is not particularly interested in spending his retirement sleeping on the floor with real time data feeds observing the markets 24 hours/day?

And I rather doubt that the OP would hand you his USD 600k with your guarantee of 7%.

The current and, IMO, foreseeable future market conditions are and will remain extremely difficult for investors. Particularly for those who have saved and are hoping to live out their lives on their capital, and have earned their money through employment rather than building up years of experience on the stock markets.

There is no risk-free strategy which will return more than inflation. Indeed, there is no risk free strategy. Full Stop.

Edited April 26, 2012 by 12DrinkMore

[Naam]

Indeed, there is no risk free strategy. Full Stop.

all said, nothing to add!

[Chivas]

Fair play and point fully understood.......

The only thing I would add was that originally I was asked how I could guarantee 7% and again to make it clear if I was making only 7 % a year on average I would have given up a long time ago.....

Its a lot lot more than that and have just been playing with figures and they may be slightly loose 0.5% either way but am averaging 15.7% (tax free or taxes paid) over a ten year period. (Have had to average it over 8 years as that's the period of time I have been active).....

So essentially none of what you have posted is relevant to the OP, who I would guess is not particularly interested in spending his retirement sleeping on the floor with real time data feeds observing the markets 24 hours/day?

And I rather doubt that the OP would hand you his USD 600k with your guarantee of 7%.

The current and, IMO, foreseeable future market conditions are and will remain extremely difficult for investors. Particularly for those who have saved and are hoping to live out their lives on their capital, and have earned their money through employment rather than building up years of experience on the stock markets.

There is no risk-free strategy which will return more than inflation. Indeed, there is no risk free strategy. Full Stop.

No one suggested the OP should sleep on the floor ?? Where did I say that ??

The point I was making (which you got the first time) was that by dedicated active trading sleeping on the floor or otherwise, 7% is very achievable.

I achieve double that with what I consider low risk trading.

You guys need to join the trade2win forums where'll get laughed off the forum by being satisfied with 7%.

At no point I might add am I touting for business.