Sunday, January 14, 2018

2017 – Dollar Cost Averaging into an Index

If you had invested $1000 in an index ETF every Friday (or last trading day of the week) at the closing price in 2016, how would you have done? Listed at the bottom is a list of the same ETFs with a single investement at the closing price on the last trading day of 2016.

Excludes dividends and trading costs.

A lump sum early would have easily outperformed dollar cost averaging in 2017! 2017 was a year where we really didn't see any market corrections, so trying to buy periodically failed the lump sum at the beginning of the year.

Fox Business Block Gurus 2017 Final

Here’s how the Fox Business Block gurus performed in 2017 compared to the indices (excluding dividends). This return is based on investing $1000 per weekly stock pick at the closing price Friday night. The stock picks started 12/31/2016 through the 12/23/2017 picks, versus dollar cost averaging into the index ETFs during the same time period.

The stock market had a good 2017, so you think that everyone would look like a great stock picker in a rising market. There is some saying about a monkey throwing darts at the stock page could pick winning stocks when the market is in an uptrend!

Five of the index ETFs were in the top 7, with Charles Payne and Gary B. Smith in the 3 and 4 position, respectively.

Semiconductors had a great 2017, as the SOXX led all in the list. Overall, the large market index ETF, SPY and VTI, finished in the middle in 2017.

Most stock picks are made without any future guidance. Once you buy, there is no advice to sell or buy more. The shows do have an occasional “follow up” show that goes over the best and worst picks for each guru, and what they’d do with that one or two picks going forward.

The Fox Business Block is ending as of this weekend and being replaced by a 2-hour long "Cavuto Live" show. It is truly the end of an era! 18 years!

Sunday, November 19, 2017

Corvette Near Extinction?

Chevy slashes price of a Corvette by $9,000 as sales crash

Chevy says it is "closeout" time for the 2017 versions of many of its cars. Among the vehicles with the largest discounts is the 2017 Corvette Z06 which is priced $9,107 below MSRP.

Chevy is having trouble selling the current Corvette.

Corvette sales have been worse than dismal this year. Chevy sold 1,345 Corvettes in October, down 49% from October last year. Sales are off 20% for the first ten months, from 20,236 to 25,345.

Still seems cheaper than  a Tesla.

I don’t know what to say about the Corvette.  I’ve always wanted some sort of a muscle car.  While the Corvette seems to be a little fancier than just a muscle car, it’s been on my list.  But still too expensive for the practical side of me…

Chipotle Woes Continue

Reports of illnesses from Chipotle are soaring

The rate of self-reported foodborne illnesses are at least nine times higher for Chipotle than all other restaurant chains, says Patrick Quade, the founder of     

"The rate of food poisoning reports attributed to Chipotle continues to be multiples higher than peers," Quade told Business Insider, referring to data pulled from his website, which allows people to self-report illnesses. "At this rate of reporting, our data indicates we should expect to see another outbreak attributed to Chipotle sometime in the next six to 12 months."
Have you been to a Chipotle lately? This was a favorite spot for my coworkers to go a few years ago.  And whenever you went, there was a long line of folks waiting for their chance to get a burrito.

The crowds are mostly gone.  Most lunch hours, you can walk right up to the counter and be out of the place within a few minutes of receiving your order.  

It's also been an ugly journey for shareholders.  Check out the stock!

What's next?  If the company can't stay out of the headlines regarding the quality of their food, I don't think it will translate into huge earnings growth or PE multiple expansion.

(And it would be nice if they offered white chicken as an option instead of thigh meat...)

Saturday, November 18, 2017

Tax Cuts Derailed?

Why a Firm Believer in Tax Cuts Could Derail the Senate Tax Cut Plan

The sudden fissure between longtime allies laid bare the challenge that Republicans face as the tax bill leaves Mr. Ryan’s care and navigates the rough waters of the Senate, where different priorities within the party could sink the bill if not adequately addressed.

In the Senate, where the party’s margins are much smaller and individual members are more powerful, party leaders will need to win over what could be a half-dozen or more wavering Republicans, beginning with Mr. Johnson. Others include Senators Bob Corker, Jeff Flake, Lisa Murkowski, Susan Collins and John McCain

The tax cuts passed the House, but the Senate is a little trickier with tighter margins for the GOP.  The special interests for verious write offs  and deductions, plus the health care mandate, are going to come face to face with reality.

I just don’t think it’s going to happen.  It’s going to fall a few votes short.

That will be a big problem for the Republicans in the 2018 midterm elections.

Wednesday, November 15, 2017

Are the GOP Tax Cuts Dead?

Analysis: GOP tax plan deeply unpopular — and unimportant to many Americans.

On Tuesday, the Senate proposal was expanded to include a repeal of the individual mandate that’s part of the Affordable Care Act (better known as Obamacare). The effect was to create a sort of policy Frankenstein (actually, a policy Frankenstein’s monster) that combines two of the party’s biggest priorities. It’s an iffy move, given the deep unpopularity of the health-care proposals the Republicans were proposing. But, then, two new polls show the Republican tax proposal isn’t that popular, either, even before health-care reform was jammed inside of it.

The Kaiser Family Foundation asked Americans what Congress and the president should focus on. What’s important to address, the survey asked: Tax reform? Reauthorizing the children’s health insurance program (CHIP)? Funding the recovery from this year’s hurricanes?

More than 6-in-10 Americans said CHIP reauthorization and hurricane recovery should be a top priority. Only 28 percent said reforming the tax code should be.

This is from the Washington Post.  So...  #FakeNews

But is it?

I get this feeling that the tax cuts are dead.  The Democrats have done a great job as the opposition party.  It doesn't matter if they're right or wrong.  They have persuaded enough people that whatever the Republicans are doing regarding health care and tax cuts is straight out of the Adolf Hitler playbook.  Or Ronald Reagan (same thing, they say).

I'm one of those people in California who would probably end up paying more taxes, should the Republican bill pass.  But I think that the Republicans have this one chance to reduce corporate taxes and income taxes for most people.  And those "most people" live in a lot of those battleground states!

The line I bolded in the quote was a key point in the WaPo article.  People want the government to spend other people's money.  There are always enough just causes and emotional buttons that need to be pushed.  Who could be against feeding kids or hurricane aid?  Or free college?  Or affordable housing? Or ...?

Just not enough money to do everything for everybody.

But I think the tax cuts are dead.  Spend on, Washington.  Spend on.

Monday, November 13, 2017


Can Roku Stock Keep Going After Last Week's 70% Pop?

Wednesday afternoon's hot quarter suggests that Wall Street was underestimating Roku's potential. All but two of the seven underwriters that took Roku public slapped it with uninspiring neutral ratings with the stock in the low $20s last month. The stock is now in the low $30s after hitting a new all-time high on Friday.

Roku's model is more compelling than you may think. Its operating system is now built in on a fifth of the smart TVs being sold. Hardware sales are sluggish -- player sales are flat through the first nine months of the year relative to a year earlier -- but the growing installed base of video buffs with either Roku media players or devices running Roku OS is delivering explosive platform growth. We've seen active accounts soar 48% to 16.7 million over the past year. Engagement is clicking as consumption, up 58% to 3.8 billion hours during the third quarter, is growing faster than the active base.

Roku.  Apple TV.  Amazon Fire.  Chromecast.

I own three Roku players and one Apple TV.  I have checked out a Roku TV.  I think Roku gets it compared to the others.  

Roku is easy to use.  There are a ton of apps and content for the Roku.

When the stock went IPO, I thought maybe I should short it.  Heck, it looks like a little device maker standing against the forces of much larger companies with much larger budgets.  And I wonder if a lot of the stock pop is due to people who think like I do, and that this isn't going to work.  But maybe these folks have been forced to cover their shorts since Roku published their earnings numbers!

Anyway.  I'm thinking about getting a Roku TV for my office.