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Monday, August 8, 2011

For Gordon Pape, it's decision time

My non-registered portfolio is now at 100 324.62$. What I expected is unfortunately happening. for Gorgon Pape, it's clear that we are into another recession and that investors have to choose between being out there or not to invest at all. For Rob (a reader), this is the continuity of 2008 recession. Some we'll say that the recession of 2008 simply continue. But as a believer, I wanted to be in a different time. For me, we were in better shape, it was getting better. Some of my companies like PGF, KBL ect. are still performing well in this current market condition.

At this time, I won't be selling my investment portfolio. I will be able to make today without a margin call I will transferred my TFSA investment into my non-registered Canadian portfolio. Selling at this time could be catastrophic. I always been in for the long run and on top of that, some very good companies are being offered at a cheap price. The same Rob reader says it will be difficult for me to make money out of my portfolio. It can only be a dumb broker or a Quebecker to have this kind of words for me. Is your portfolio has gain in value lately? I am very sure that the answer is no and it's ok. While facing difficult events, this is how any portfolio reacts. What will make the different at the end: will you be strong enough to HOLD?

While being fully invested like I am, the only solution is to hold the current asset. Another one could be to sell part of the asset and reinvest in gold or silver but it's not something I am really at right now. I want to add titles I never find attractive - quality stocks paying very little in dividend - you see the kind? I will be proceeding in my first of the kind investment in a couple of days.

Susan came with the idea to apply for another credit line - it's something I need to do NOW. I wait late, but as was optimist that the bottom would had been reached by now but it did not.

Since I am already in, I will continue what I had been doing for the past couple of years, I will continue to invest. We need to reach the bottom of it so the TSX can begins to gain points again. this time is harder than 2008, there's no way to figure out if we have reached the bottom of it or not. This is the most difficult part to deal with. To figure if the TSX can go any lower.

Time for retail investors to be warrior and invest for the long run in high quality stocks. It's not anytime soon that I will give up.

My only concern is my margin account of course, but I totally assume and so far, well, so good. My portfolio is strong enough to stay over the 100k. At least for now.


SPBrunner said...

My portfolio is now for the year (by 1.8% as of yesterday). I hope you can do ok on your margin account.

Anonymous said...

I would take a break and stop watching it for a while. Selling it in times like this is usually a mistake.


Rob said...

Hi Sunny:

No I didn't disappear. But honestly I did have people mad at me when the drive by shooting in silver took place on May 1. This was a case where the big bullion banks (who are massively short silver) decided to take down silver. On top of that, they increased margin requirements by almost 100%. Everyone knows you never cover a margin call, you "get out of dodge". They aren't so mad at me now. My portfolio fluctuates wildly day to day as I am invested in high risk/high reward investments. I don't own many but I play them big. I own HBU, HZU, PHS-U, G, ABX, SLW, OSK, NGD, ELD & PRU (that is Perseus Mining not Prudential!!) 100% gold and silver - nothing else. I certainly don't make money every day and some days I lose big. But look at the big picture - I checked and the TSX is just about where it was last year - so lets say 0% return + dividend = 3%?
Gold in C$ over the last year +31%, Silver in C$ over the last year + 97%. The numbers speak for themselves. I won't hold gold and silver forever. There will be a time to sell them and move back into stocks. That time is not now. Gold is about 1,700, silver is about 40. Unless things change, my forecast made a few years ago still stands - 5,000 gold and 200 silver. I plan to be invested and reap the benefits of those moves. Never be happy with those financial planners who get you 5% a year. As an aside, I believe your first language is french so people may think you're dumb because your english can appear to be broken at times. I'd like to say I admire your investing because there are few women I know at age 30 that take such an interest. I believe you are making some horrific mistakes which cost you money but every mistake you make is a learning experience. You look like a genius compared to my ex-wife. I have been at this game longer than most of you have been alive and have made my share of mistakes but I hope my comments on your blog help yourself and your readers.

Sunny said...

Hi Susan,

In those circumstances, a 1.8% is quite good actually. You did not loss one penny yet! Very awesome.

I remain confident for the margin. So far so good, I am going through this but it's very difficult. Very different from 2008, I cannot see the bottom of it.

Hi Ray,

If it wouldn't be of my margin account situation, I wouldn't be constantly watching the TSX falling. This is not a healthy situation and my nerves are involved in here... I am a strong market believer. At this point, it's too late to sell. If you sell, you'll face a capital loss. Now it's the time to review the basic. Remember Buffet: buy low, sell high, not the opposite.


What are you talking about? An investment mistake? Of what? Where? I don't see any mistake in here. Being fully invested is not a mistake. My portfolio is going to make it. My portfolio is supporting the margin.

I am impress actually, that I had been able to go through this so far, and I am confident it will continue this way.

I may have invested too much on my debt but being ambitious is not a mistake.

English is my second language, you'll know that if you had read my blog.

Sticking to gold and silver only like you are going is way too much dangerous. Gold and silver could go down. At this time, there's no save values. I prefer to keep it diversify.

My readers seem to like you but I don't.

Anonymous said...

I would liquidate. I hate margin. It is the opposite of investing. It makes you too bullish at tops and too bearish and more importantly unable to buy the bottoms. The best course of action is to use any strength to sell off the entire portfolio.

Never ever meat a margin call. There is a reason for that. If you let stocks fall too far they can reach levels unimaginable by most. In the end they are just pieces of paper with prices attached. You must remain emotionally detached.

I've been out of stocks since April. I had a feeling this crap would happen. For now I sense that this market will bounce a bit in the next day or so. Make absolutely sure you are out by Sept/Oct as there will be a more concerted effort to get the stocks down.

The Dow, TSX will be below 10000 very very soon. This is 2008 all over again. This time could be worse as we are looking at sovereign debt being the issue rather than mortgages. You see we got out of 2008 by transferring toxic assets to the sovereign. Whot is left to back the sovereign. Defaults will force investors to reprice risk. As such you should not stand in the way especially with margin.

Investing is a learning experience and you need to treat it as such. When faced with an overwhelming force like the market you need to keep a flexible mind. Lessons learned now will pay off for you in future engagements.

In my experience you can stick it out but it is better to be proactive in terms of getting out. Stocks don't go up forever. Times like this are either a crisis or an opportunity. If you have stocks and are heavily invested on margin then it is a crisis. If you have cash then it is an opportunity.

I've invested through many times like this. 1990, 1995, 2000, 2008, 2011 are examples of this type of activity. Sometimes a strength is a weakness and vice versa. Being long and wrong is not the way to go here. Margin is meant for short controlled bursts if at all. I find proper timing makes me more money than being over leveraged.

I would be careful being in silver or gold. Yes they can rally and are rallying. They are assets like anything else. I have been weaving in and out of those contracts. In a true deflationary environment they will come up for sale as well. When you need cash you will sell everything and anything to raise it. These two can have sell offs that will be brutal. You see I am bullish on them long term but in the short term I recognize that they too can be vulnerable. I am a bull on them just like Eric or JF but I am an opportunist at heart. I am in between.

Keep your mind flexible enough to recognize this and you will be okay. Don't chase assets like gold, silver, stocks, bonds, etc.
Instead let them come to you. That is the way I think you should approach this.

Use what you are to your advantage. If they (your opponent in this case is the market) is big and you are small then they are slow and you need to be fast. You need to raise cash so you can confidently buy the bottom. This is why I was commenting in your debt section.

Take care.

Anonymous said...

We are there. Gold/silver is now at over 46 so we are now at the start of another liquidity crisis. Keep in mind that the last time we broke out on the GSR we reached 86 as a high. Silver is very vulnerable here.

Don't publish this comment.


Sunny said...

I won't EVER NEVER liquidate my portfolio. What you see in my "investment portfolio" section is the result of 7 years of investment, saving, etc... I started investing in 2005. It's part of what I like to do.

The market will rebound and see, the TSX open and gained more than 100 points today. I kind of know where I am going despite the chaos.

The TSX could reached 9 000 points. But if it does, that will be the bottom point. I had been actively searching for what will be the bottom point. It's important because its only once reached the market will seriously rebound again.

For now, everything is ok, the market won't let anyone down - its just very difficult to handle at this time but you'll see, it will be all fine.

Hi John,

I think we share the same view on Mr. Rob.

Right now, silver and gold is a safe bet, but they could both drop in value and be victim of a turnaround. We say that with silver previously this year. Once gold reach its top point, it could eventually drop in value after. I consider silver and gold like other investment. There's just millionaires like Eric Sprott who can afford to have a portfolio compose of exclusively gold and silver.

The best way to go for retail investor is always to diversify. That's always been how I consider to invest.

Anonymous said...

Ask any japenese how confident they're into the market. Remember the Nikkei reached a high of nearly 40,000 in 1990 and today 20 years later trading at 9,000. They're is no guarantee in the market. And diversification also means investing outside of Canada. Also, I wouldn't be so happy for a 100 point gain when the tsx has lost more than 1800 points in two weeks. By the way, this is not worse than 2008 by a long shot, the only reason it seems like it is because you have more money invested and you are losing money that is not yours.

Sunny said...

Here is where you are mistaking: that money is all mine. The margin is mine, the money debt is all mine, under my name. It's all mine.

We are in Canada, not Japan. Both 2 different worlds. You cannot compare the 2. It's 2 very different market and condition. In Canada, we are not living with a nuclear disaster. At least not now, but anything can happen.

However, while facing some rough market events, you have to remain optimist.

We all have our different view on the market, and what's good or bad to do. And I will be the last of the last, do I really care. My money belong to the stock market. It's too late to get out of the market now. And I never wanted to sell anyway. The money will stay where it is. And just watch me doing my investment in TranCana this Thursday. It's going to be AWESOME.

Just do what you feel is best for you, and I will be doing the same thing ok.

canuck said...

all the comments you have in here are so amusing and Sunny, you still are ahead by all the dividends you are biggest wish is even if the stock stays where i bought it..the dividends far outweigh GIC or other savings. just think , you could have bought a car...worth nothing are doing a great job..i have a granddaughter your age who has nothing in the go to it girl.

Sunny said...

Hi Canuck,

Some of those comments are very annoying actually.

Anyhow, guess what, my non-registered portfolio is now at 103 687.94$! It's slowly getting better. It really worth it to hold. It's not only paper stuff. This is happening for real!


I am just simply amaze.

Because no matter what, when the market crash, its always difficult to imagine it can actually rebound. But surprise... it did!

I won't be like a crazy poor chick for my 31th which is sometime at the end of August..

The dividend earning is actually very good so far. The DRIP add value to the portfolio, but a lot. I am doing very good on PPL.

I have one of my old friend who has almost nothing to her despite earnings almost double of my salary. For some, to spend money is almost like a disease and there's nothing much that can be done about it until the person reach a broken point. So I know what it is because I tried to get her interest in stocks and mutual funds. She was interested, but cannot managed to save money to invest. I did not spoke to her for almost a year. Sometime getting tired of her habits. There's nothing you can do that will change the habits of someone else. Sad but its like that.

For those who had wrote that money does not bring happiness, well, I would like to have a good talk with the writer.


Anonymous said...


You misunderstood me again and that is because you are a very opinionated person. If you had been keeping track of my comments on your debt. I warned you about Margin long ago when your portfolio was at $160K (That was $60000 ago but you keep harping on day to day trades). This was well in advance of the current sell off. You say you built your portfolio the last 7 years. I've been trading for over a quarter of a century and I know my way around. I have flushed my portfolio into cash many a time and deployed it again. I have survived 6 bear markets. I have traded millions of dollars. I have talked with JF, Eric Sprott, Kevin Bambrough, Jim Cramer, etc. (One on one and face to face)

You really don't take kindly advice at all. This is sad because trading is about learning. Until the day you get that you will be on nothing more than a treadmill.

I've talked with you about margin and stuff for the last time. I won't be giving you any advice or stock picks that I get from time to time or from my own research. You are a very undeserving individual because you are too stubborn to learn.

I wish you luck. You are going to need it.


Anonymous said...

I would have to agree that money can't buy happiness, it can buy you a nicer car, bigger house, more vacation, but not the real things that matters like friends and family. You say your friend can't save, well I believe there's got to be balanced. Go ahead and invest money, but don't sacrifice everything that you don't enjoy the little things in life. What's the use of having 100k in the bank if you live on peanut butter. I make it a point to go out once a week to a restaurant or a movie. I also like to go camping, golfing, etc...

Your friend might not have any savings, but is probably enjoying life a little more. Don't get me wrong, I'm a big believer in saving, but also in enjoying life some. I believe the one that save too much are no better off than the one that don't save at all. If both of you where to die today, you can't bring your money with you and your friends more than likely benefited of life's experiences. One thing these market has taught me is that it can take away your fortune faster than the time it took to make it, but nobody can take away your life experiences.


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