Neville's Financial Blog

My next short term goal is to:

Make $11,000 by April 31st, 2005.

This means I must make an average of:

• $2,750 per month
• $687 per week
• $98 per day

This goal is more than double my last 4 month goal, so something about my income must change. I must either work more, make more money from my online business or create a new income stream. I plan to do all three.

Labels: Financial, Goals

One of the reasons I started this blog was to track if I was meeting, exceeding or falling short of my goals. One of my short term goals was:

By December 31st, 2004, I should have made $5,000 since September.

Well it is December 31st, here is how I performed:

September Business Profit: + $468
October Business Profit: + $459
November Business Loss: - $9 (Server was down)
December Business Income: + $913
Profit from Wheaton Sale (WHT): + $567
Profit from Syntel Sale (SYNT): + $776
Loss from V.I. Tech Sale (VITX): - $316
Birthday Money: + $101
Parents: + $240
Work: + $1,930
Webpage Work: + $150


Total Income: + $5,604
Total Losses: - $325
Total Money Made: $5,279

General Account: $2,118
Business Balance: $2,416
Spending Account: $385
Investment Account: $1,035
Permanent Savings: $5,260
Stock Portfolio Value: $8,118
Credit Card Balance: $0
Total Assests: $19,332 (+ $900)

Labels: Financial

Still in New York and having lots of fun. Here is an updated breakdown of my expenditures up till day 9 of the trip:

• $188 - Two tickets to New Year's party
• $75 - Random spending money
• $18 - Movie Tickets
• $80 - Spending Cash
• $20 - Subway Costs
• $14 - NYC Lunch
• $20 - Spending Cash
• Total - $415

I haven't broken down "spending cash" because it would be a very long list of small things like hot dogs, drinks, tips etc. Keep in mind I have also been paying for two people in many places.

Labels: Financial, Personal

I'm in NYC right now, and so far I have been paid for in most places. Major spending to point out so far (Day 4 of the trip):

• $188 - Two tickets to New Year's party
• $75 in random spending money

So far very little money has been spent, but the worst is still to come during New Years. For the time being, Merry Christmas and Happy Holidays to all!

Labels: Personal

Dynegy (DYN) stock took a massive drop after it reported paying off debt, but then took a nice rebound. I waited for the stock to drop rock bottom, then make its way up. I have a limit order for 220 shares of Dynegy at $4.65, but unfortunately the market is on a holiday schedule.

Dynegy was also upgraded by several firms to $5.10
I plan to hold Dynegy for the longterm, so I may sell a few shares if it reaches that target, then buy it again if it goes lower. This was I can keep the stock longterm, but extract some profit along the way.

Dynegy looks like it's back on track and ready to make a rebound. In the short term I still think the stock will be shaky, but 2+ years everything looks alright.

Bought on September 13th as an experimental trade, SCON turned out to be quite a loser. The original investment was a paultry $387, so I decided to let it stick around to see what happens. The company had a decent product aimed towards the telecommunications market and a lot of good press. The last few weeks the stock slowly started rising, jumped over 30% in one day, and today finally hit my target sell price of $1.40.

Today marked the day when Superconductor Technologies (SCON) finally paid off. I was originally trying to just break even, but it paid off holding it. It at least paid off the loss I made on JBL two days ago.

Jabil Technologies (JBL)
Bought 45 shares at $25.84 one day, sold the next day for $25.35 when the stock started slipping despite a slightly better than expected earnings report. -$22.05

I'm going to New York tommorrow for two weeks. I will continue to update the site from there (it will be especially important to keep track of my spending while visiting).

As for now, here are my current account balances. By the time I get back, the spending account may very well be $0.00 !

General Account: $1,108
Business Balance: $2,422
Spending Account: $503
Investment Account: $1,044
Permanent Savings: $5,221
Stock Portfolio Value: $8,134
Credit Card Balance: $0
Total Assests: $18,432

Labels: Personal

Today I bought 45 shares of Jabil Circuit Inc (JBL) at $25.83 a share. I put some money on them because they provide the inner workings of today's modern gizmos...not to mention they were reporting earnings today.

Jabil Circuit Inc. reported after the market closed that sales rose 21% and earnnings climbed 32% for the quarter. Earnings estimates were beat by $.01, not much, but this makes them ripe for a slow advance during the holiday season. Hopefully I can get a nice 8 or 10% gain during the next few days.

45 shares JBL @ $25.83 = $1162.35

Shares of JBL must rise to $27.90 for me to get an 8% gain.

On this recent post I detailed what progress I should be making after final exams finished. I am at home in Houston now and have somehow been distracted everyday.

This is no good. I've set out goals for myself and I have not met them. This needs to change. With whatever small amount of spare time I get during my two weeks in New York, I should try to:

• Finalize updates on Timber Trace website.
• Inquire about best options for opening 2nd brokerage account.
• Get Resumite ready to do business (finalize all sample sites).
• Add new content to online business everyday.
• Finalize traffic alleviation proposal on I-35 in Austin.
• Create new investment ideas.
• Have fun.
• Meet my goal of making $5,000 by 12-31-2004.

If you see me moseying around anywhere, make sure you ask me if I have first completed ALL of the above!

My weekly transfer of...

• $60 to investment account
• $40 to permanent savings
• $10 to spending account

...went through on Friday like it does every Friday. I got a $150 check for some web design which I evenly distributed through the savings, investment and spending accounts. I also get a $300 check sometime next week from work.

Total assets went up $856. Keep in mind that total assets include my business balance, a.k.a. the money I OWE the fulfillment company.

General Account: $1,821
Business Balance: $1,683
Spending Account: $303
Investment Account: $983
Permanent Savings: $5,170
Stock Portfolio Value: $8,134
Credit Card Balance: $0
Total Assests: $18,094

Labels: Financial

One of my goals was to finish Resumite.com by Dec. 15th. It is mostly done, but I need to add content and upload the sample sites. I am a bit dissapointed that I did not do this earlier.

I don't really expect to do any business with Resumite until I get back to school. This Dec. 15th goal was simply an arbitrary date I had picked. Next time I make a goal, it should be completed by a relevant date.

Labels: Goals

Investing in stocks and making my saved capital appreciate is great, but it doesn't help me pay expenses. I like to invest and re-invest money for my future, but what about the expenses I have now?

After I graduate, to pay bills I will need some steady income. So far I have thought of these three steady income ideas:

1. Getting a Job: Easiest way to make money. The monthly paycheck can be used for savings, investing and paying the bills. You can also simultaneously run a small, low maintenance business on the side.
2. Real Estate: Difficult entry. Renting out a piece of real estate provides a great monthly income, but it can also be a big cash drain. This method would go along well with having a job, since the real estate generally requires little attention once established.
3. Small Business. Intermediate entry. I personally like this one the best, because owning a business gives me the feeling of earning my money. All my risk and labor will come directly back to me with a small business. This method can also go completely wrong, and is very risky if it is your sole income.

After college, I plan on doing all three within two years. As of now, I already invest, run small businesses and hold a job. Some real estate needs to be added to my current situation. Perhaps I will buy a small apartment or condo in an emerging area soon.

Labels: Financial

I generally don't like large-cap stocks, but with my new long-term portfolio in the creation I am taking a peak. Look at the 10 year chart for General Electric (GE) and it's steady growth over the last two years.

After a major correction, I believe GE will continue to follow its regular growth path...and let's not forget about the dividend. Tell me what you think.

Labels: business ideas

I found this article about Mario Gabelli interesting. One quote I particularly liked was:

Gabelli made it clear that his firm only hired PhDs - and by that he means
"poor, hungry and driven."

I love it!

All of these are seperate checking and savings accounts I have:

General Account - When any money comes in or out, it goes through the general account. There is always at least a $400 cushion in the general account for a rainy day.

Spending Account - This is the money I have available to spend on any frivolous thing I want. 20% of my paychecks go here and 20% of money generated. $40 per month is also automatically deposited. By 11.17.2006 I plan to use this account (with the same percentage rate) to pay for all general living costs.

Spending Account 2 - This account was created for larger purchases related to spending such as Christmas gifts, vacations, birthday gifts etc.. I have started putting about $20 per week into this account through automatic transfer. This account should most likely build year-round until big events come along.

Investment Account - I keep a minimum of $500 here at all times. I put a mandatory $240 every month and 30% of other income. When the amount tops $1K, I generally infuse the money into my stock portfolio. Any purchases that make me money are charged to this account also.

Bill Account - I' ve got bills to pay, and this is where I pay them from. There is approx. $10 per week being automatically transfered to this account.

Permanent Savings - This is the ultra-secure savings account which will not be exposed to risk. I put a mandatory $160 in here every month plus 30% of other income. I will never touch this money until I am over the hill.

Charity Account - This account slowly builds money all for the purpose of giving it away to charitable causes. Making money feels great, but giving it away feels better!

Stock Portfolio - My current brokerage account value. This can vary wildly as stock prices rise or fall.

ROTH IRA - My ROTH IRA account which I buy stock, bonds, index funds etc. I will never touch this money till retirement.

Emigrant Direct Account - This is another permanent savings account, but not hosted with Bank of America. I keep this account aside because it gives decent returns and no risk.

Credit Card Balance - This will always be zero or negative because I pay off my credit cards before charges are even made.

Business Holding - This is the amount of money I OWE to the company that fulfils all my online business orders. Since bills usually come 2-3 months later, I sometimes leverage this money for play in the stock market. This money CAN be used, but I generally do not.

Labels: Financial

Credit cards. Ughh.
I've been using my own check card since I was a senior in high school, and I love it. Transactions are immediately posted online and you can only spend what you have. I've only recently got a credit card to help build my credit, but I've barely used it.

Since I have to use it, I fight the tactics CC companies use to make you overspend and borrow their money. Two of my tactics:

1.) Pay before you buy. I will pay off my credit card before any charges are posted. I will have a negative balance, and work my way up to a $0.00 balance as I charge items.

2.) Counteraction. Everytime I make a charge, I go home and immediately transfer the funds into an account I have for paying off the credit card. When the charge finally posts to my account, I always have the funds to pay it off.

I still believe credit should be used for buying assets only, not a new Gucci wallet.

Labels: Financial

Today I cancelled a $5,000 CD account I started over a year ago. To date, I earned only $39 from interest. The interest varied every month between .5% and .75% annual interest. With rates that low, I feel some of the money would be better off in a different investment vehicle.

For the time being, I put the money in my permanent savings. I will leave half of it there, and start my 2nd brokerage account with the other half. My 2nd brokerage account will be my longterm account. The stocks or funds I buy for this account will be held for 2+ years at least, if not 30+ years.

Current Asset Structure:
General Account - $ 1,259
Business Balance - $ 1,683
Spending Account - $ 243
Investment Account - $ 873
Permanent Savings - $ 8,080
Stock Portfolio Value - $ 5,100
Credit Card Balance - $ 0

Labels: Financial

Today when golfing with friends I realized how much I like golf just for the business aspect of it. The comfortable, open and semi-formal aura of the golf course makes it an ideal spot for personal and business talk.

On another note,
Everytime I view NevBlog, I feel it emulates The Kirk Report more and more. This is not a bad thing since I greatly respect his dedication to the market and desire to help the little guy.

Tommorrow (Sunday) I am going for an 18 hole round of golf, then Monday I finish my 2nd to last semester of college. After Monday I need to focus on:

• Creating new investments.
• Opening my 2nd brokerage account.
• Getting Resumite Personal Sites ready to do business.
• Adding new content to business.

Here is my Financial Update for 12-11-2004:
General Account - $963
Business Balance - $1,683
Spending Account - $431
Investment Account - $873
Permanent Savings - $3,040
CD Savings - $5,039
Stock Portfolio Value -$5,104
Credit Card Balance - $0

To make extra money I've always designed websites. Now that I'm done with final exams for the week, I can concentrate on Resumite Personal Websites (I have set a goal to launch in on December 15th).

I try to start small businesses all the time. Since I'm a full time student, I look for businesses with low/no overhead, low entry costs, flexible hours and good returns for my time. My first real business from high school still brings in more money than my job, and I spend less than 20 minutes a day on it. For Resumite, I decided to do a different take on standard website design because it is a very saturated field. Resumite will be a simple business to start, and 100% profit (especially since I already own a dedicated server for hosting). All I need to do is market around campus and online.

-About Resumite-
-Personal Resume Websites (Resume + Website = Resumite)
-Users can have their own yourname.com website to put on their resumes and business cards.
-Price: $50 for basic package. Includes 1 year hosting, domain registration and a choice of sample sites.
-Check it out - It is still in the construction phase.

Syntel (SYNT) and Dynegy (DYN) are both down substantially (several hundred dollar losses in each). The surprising thing is that Superconductor Tech (SCON) is still going up, the one stock I didn't have high expectations for.

Feel free to drop me comments on trading strategies etc, but keep in mind I generally hold shares for 3 months to 2 years. I have had stocks in the past that dropped dramatically, but holding on to them for 6 months reversed those losses into big gains. If you are not careful though, those losses can turn into even bigger losses.

The reason behind this post is to show myself that no matter how confident you are about a stock, it can still play games with you. Fortunately I have longterm faith in Dynegy and Syntel. Dynegy will be a several year hold, and Syntel will be held for approximately 6 more months (based on current situations).

After coming back from a final exam, I checked my Dynegy (DYN) stock as I knew they were making a big announcement soon. I saw the big red numbers that read - %10 and immediately went rummaging through the news.

Deciding to keep my investment or run for the hills with what I still have (I actually bought the stock lower than what it fell to, so I am not in a loss as yet) I noticed why it had dropped. Turns out they are paying off debt (good), and the bottom line for yearly earnnings will now take a big hit (bad) because of it.

I evaluated my stance on this position: Longterm investment with a minimum holding period of two years. I have confidence Dyngy will get back on its feet when the initial hit clears. It may take a few years, but this one is for the longterm portfolio.

The lesson learned here is how fast your luck can change. Just 12 days ago I wrote an entry bragging about how well DYN was performing!

My goal to make $1,000,000 in liquidable assets by the time I am 27 will be difficult to reach, but it is something I aim for. I've been told to set realistic goals, and I do make very realistic short term goals, but I enjoy making high demands of myself because they challenge me to go beyond what I know I can do.

So if you will excuse me, I have some more zeros to tack on my account balances :)

Labels: Financial

General Account: $1,453
Business Balance: $1,032
Spending Account: $461
Investment Account: $779
Permanent Savings: $3,000
Backup CD Savings: $5,036
Stock Portfolio Value: $5,715
Credit Card Balance: $0

Paycheck was distributed to permanent savings, investment account and spending account. I took $21.15 out of the general account and put it in the permanent savings to make it an even $3,000 just for fun. I have one more paycheck coming, and I will put a good amount of it towards the spending account since I will be visiting NYC this Christmas and New Year (NY is expensive!)

Thanks Trader Mike for the link on your website!

Labels: Financial

I bought my smallest share ever of a company ($387 worth) of Superconductor Technologies (SCON) a short while back as an experiment. The exeriment was to catch a short term gain after a large breakout in price. I caught a short gain, then it fell. I was going to sell but I liked the company, although the charts didn't look good.

I roughed out a -40% loss for 2 months, and finally today the stock rose +33.72%. The headlines aren't saying what caused this massive 3 hour increase in price, but it looks like I may actually get my money back and then some. The only reason I accepted such a high loss was because of my limited amount of exposure, unfortunately when the stock goes up, this small exposure doesn't make me much $$$...but hey, at least I won't be losing any!

http://www.thekirkreport.com/
http://www.pfblog.com
http://tradermike.net/
http://www.maoxian.com/

I regulary check up on these blogs everyday to learn more about stocks, finance and life. For anyone looking to start investing, try reading these blogs as a start (but make sure you do your OWN homework also). Remember, if you like what they do, drop them a contribution every now and then!

Labels: Blogging, Financial

To find out the percentage of your assets which should be exposed to risk, simply use the Rule of 100:

100 - (Your age) = Percentage of your assets which should be invested.

I am 22, so 78% of my savings should be exposed to some risk, and therefore a larger chance of gain. The other 22% should be tucked away in a fail-safe account such as a CD or other savings device. This is by no means the correct method for everyone, but for my needs it seems right. As a semi-active investor I'd like to see more of my net worth exposed to some potential gains. I think it is better to learn financial mistakes while you are young and can easily recover rather than when you are older and have bills to pay and a family to support.

To restructure my finances to meet this 78% mark, I am stopping my $5,000 CD which has earned only $36 after a year and a half. The current rate I am getting is 0.75% which is much lower than inflation. I will put half the money back into permanent savings and invest the other half. While I enjoy having money to invest, I also enjoy the security a pile of cold, hard cash can provide.

One of the reasons I started this blog was to track if I was meeting, exceeding or falling short of my goals. One of my short term goals was:

By December 31st, 2004, I should have made $5,000 since September.

Am I close? I only have 29 days left, let's take a look at the money I've made and lost since September:

September Business Profit: + $468
October Business Profit: + $459
November Business Loss: - $9 (Server was down)
December Business Income: TBA
Profit from Wheaton Sale (WHT): + $567
Profit from Syntel Sale (SYNT): + $776
Loss from V.I. Tech Sale (VITX): - $316
Birthday Money: + $101
Parents: + $240
Work: + $1,398

Total Income: + $4,009
Total Losses: - $325
Total Money Made: $3,684

Money I have to make in the next 29 days: $1,316

I have some money owed to me for webpages, I have two more paychecks coming and I have 400+ profit sitting in stock with the possibility of going further up (or possibly down). The online business will also be rather profitable since it's the holiday season. Hopefully I can accomplish my goal of $5,000 since September in 29 more days.

Labels: Productivity

The thought of completely riding myself of having to pay rent often intrigues me. Most people in America put the largest proportion of their income towards housing costs, if we could get rid of this massive expense, imagine how much more $$$ we could dedicate to investing.

Viable ways to avoid rent:
1.) Buy and pay off your own house/apartment. You can thank yourself for this in a few decades when you pay off your loan (if you choose to finance) because you will have no rent/mortgage to pay. The drawbacks are houses age and require maintenance, all maintenance must be done by yourself, taxes and utility bills.

2.) Live in a van. Believe it or not, I am not completely adverse to this idea. I think living in such a cramped space will make me better appreciate what I have now. It would also save me a ton of money and allow me to be completely mobile. People would think you are poor, but you could be using the money saved for stock investing or a business venture till you start making loads of money. A young person who needs to save mass amounts of money may look into this, when you are young you can endure those types of hardships.

3.) Bum off of relatives or friends. This is an alternative to rent many people utilize. People with hospitable households will get free rent, free food and a clean house to live in. The drawbacks are: You may be inconveniencing someone, the stigma of living at home, the feeling you cannot support yourself.

Out of these three, I personally think #1 and #2 are not so bad.