Retirement Thoughts

Retirement Thoughts

Will you ever be able to retire in whatever profession you are in? Yes. Why wouldn't you be able to?Unless you did not save and use your money wisely, that is. I see people all the time use money in the strangest ways possible and it riles me. So instead of putting some cash away into a safe investment, you would rather buy a tattoo or piece of clothing. Then when you are 50 that 100 dollars could have been $500 or even $1000.

Back to the point, retirement is something we all want to look forward too. I was on Facebook the other day and read a quote that had to do with working hard in your 20s, grinding in your 30s, and relaxing in your 40s. This is what should happen with majority of people. This is what your goals should be for the future. 

Obviously not everyone wants to retire, some people love what they do and continue to work during retirement. For me, I want to work, make a few deals, and sit on a beach and have absolutely no worries. Especially financial worries. It may sound like I am repeating myself in some of these posts when I'm not talking about investing or investing strategies, that is because I want all of my readers to have the mindset of saving money before spending. Especially when you get your first big paycheck, or bonus, you should use it wisely and not blow it. That is critical in making money, with your money.

Then again, who am I to tell you what to do with your money. I just want to make sure people understand it is not hard to be stable in the type of economy we live in, or who is president, or who takes as much taxes out of your paycheck as possible. You cannot rely on the government, let me repeat, you CANNOT rely on the government. You should focus on yourself, and your own problems and not let the government interfere with what you want to accomplish (providing it is one hundred percent legal).

What is the average retirement amount? There are too many "estimates" in my opinion. I suppose it depends on your living standards. My living standards are very low, all I am looking for is an average house, a few solid cars, and some real estate to have passive income, along with my stock market investments. I have read posts that 3 million is good retirement, I have heard 10 million, I have even heard 50 million. How do you even become a millionaire? (May I suggest reading The Millionaire Next Door). They did a fantastic job with illustrating what a current day millionaire does, and how they spend their money. To me, my personal goal for retirement is a solid 10-12 million dollars. Net worth speaking. Yes it is possible, for those of you saying it is not, thats why you will never achieve it.

Millions? How? Why? You don't need that much money! I am sorry I forgot there was a limit on how much currency you can acquire. That stuff makes me laugh.


I hate to say it, I may be only 19, but I am aiming for a retirement age at around 50 years old. Life is too short to just work. Even though you need to put in work to gather money, you know what I mean.



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Chris Barto

Random Thoughts & ETFs

Random Thoughts

Recently we have seen the market taking a pretty brutal beating, scaring people away, and investors pulling out. Let me remind you, fear does not create wealth, confidence does.

Do not let this market scare you away from investing.

The sooner you start investing and saving for your future, the better your financial stability will be for the future. You will be better off than the guy who spent his money on various vacations, cool technology, and expensive useless materialistic things. Even though we all want those, sometimes saving instead of buying those would be a better option.

For those of you who read these blogs, you will have the edge over someone who doesn't read them once the posts start getting more in depth. You will have more knowledge than those who decide to skip over the posts, the choice is yours. Free information is the best information, utilize it. I realize you could just pick up a book and read about this stuff, probably learn more, and it will be more in depth, but I want to help get simple points across and give you different point-of-views on things so you can analyze things. 

Today I want to talk about what an ETF is, or an exchange traded fund, are one of my favorites. An ETF is basically a security that tracks indexes, commodities, bonds, or a handful of assets like the index funds.

Are these like mutual funds? Sort of. ETFs trade like the common stock, they experience changes in price just like stocks, and you can buy and sell them throughout the day. They tend to have higher liquidity and lower, to almost no fees than mutual funds do. The low commission fees make ETFs way more interesting to investors than mutual funds. Some brokerages have commission free ETFs, some you may have to pay.

The ETFs own assets, for instance, the ETF $IBB or iShares Nasdaq Biotechnology (which in fact I do own) has holdings or assets. Some of which include, Celgene Corporation, Biogen Inc. Amgen Inc. Gilead Sciences, Inc. and Alexion Pharmaceuticals, Inc. Yes this is healthcare, personally I do like to invest in healthcare because everyone will always need healthcare. 

Shareholders of an ETF are entitled to profits, interest or dividends paid.

What are advantages of incorporating an ETF into your portfolio? 

1. Diversification, obviously.
2. Little to no commission fee with ETFs.
3. If you do not know which company to individually invest in, buying an ETF of the sector could help.
4. Easy to trade, traded on the stock exchange. 

Remember, the sooner you start, the better off you will feel financially, plus who doesn't like watching their money grow?

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Chris Barto

Investment Clubs

Investment Clubs

Have you ever wanted to get together with a group of friends, and try to make money? Well, you can, as long as you have trustworthy partners, some capital, and share knowledge about investing, you can make that happen.

Investment Clubs are all over the world. An investment club, as defined by the SEC is a group of people who pool their money to make investments. They are usually organized as partnerships. After the members study different investments, the group decides to buy or sell based on a majority vote of the members.

The NAIC is the National Association of Investors Corporation, it is the advocate of getting people together to invest. 

Now that you know this, lets get started.

There are many advantages to starting an investment club, I will list a few advantages I think are good in bullet form.

• Not only are you using your knowledge, but you are gathering information from others too. Lets be honest, not everyone knows everything.
• The Returns on investments can be much greater by gathering money from others, dividing the profits.
• Meeting on regular basis to discuss tactics to handle the market, and pick smart investment opportunities. The gatherings can be fun, bring food, some drinks, and enjoy yourself.
• Reinvest dividends and capital gains, this is the best for growing an account.
• Being a leader can add great qualities to your resume, even though everyone is on the board of the investment club, there will be specific positions per person.
• You will learn discipline, new strategies, meet new people (or people you already know), improve you knowledge, and overall have a good time.
• Fees can be lowered, unlike mutual fund holders.

I think an investment club is a great opportunity for anyone who is new to investing, has some cash, and wants to learn the ins and outs of the market and collaborative investing. It is a great way to further your knowledge and do research with peers to pick investments based on agreeable research between you and business partners.

How do you get started? Well investment clubs usually run as an LLC or a legal partnership. Which means you will have to sign documents, based up standard rules of the club. If you start your own, you can make your own rules, I highly suggest getting the paper notarized, and keeping track of what goes on if you are the leader of the club. This way, no one tries to steal money. I would strongly suggest if you ever decide to run your own investment club, MAKE SURE you design a legal document that everyone signs. I also urge people to work with others that they trust. Trust is key to getting along in this world. Lastly, diversify portfolios, do not invest all in one sector, spread it out. 

Thank you for reading, I hope this information is helping and you start forming ideas!

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Chris Barto

Technical Analysis

What is Technical Analysis?

If you like charts, then this is your type of investment method. Technical analysis is a very interesting type of way to look at a company, it is a method by looking at previous market data mainly on price and volume, and putting it together to form a forecast on the direction of the price of the stock.

There is a lot of information to this type of analysis, support and resistance, volume, chart types. I will go over Chart Patterns and indicators and oscillators in a separate post, because I do not want to bombard you with information. I won't go too in depth because I do not want to confuse anyone. I will cover most of this with basic brief knowledge. I will also use photographs from Bank of America stock using Fidelity Advanced Chart.

Lets begin with support and resistance. This is the support and resistance of $BAC or Bank of America Corporation over a 6 month period. Support is the price level that the stock falls to, resistance is the price level at which a stock surpasses.

Now as you can see, the support line of Bank of America is around $15.30 over these past 6  months and the resistance is approximately $17.44. Support is usually where investors buy the stock, hoping that when it goes back up they can sell it past a resistance point and make profit off of it. Technical analysis like this is used in swing trading, which I will talk about in another post in the future. Many people don't believe in this type of trading, but the fact is it works most of the time. Type in your favorite company on Yahoo! Finance, and I am sure you will be able to tell in multiple areas where the support and resistance is.


Now lets look at volume, providing you have read my previous posts you understand what the term volume is. To refresh your memory volume is the number of shares, or contract, that are traded over a certain time period, usually a day. When the volume is higher, that means there is more activity on the security. To determine what the volume is, you can look at the bars usually at the bottom of the chart. In the picture posted above, it is the green and red bars. Green meaning there is high volume that day, and red meaning there is low volume. Volume is very valuable because it can tell you different trends and stock chart patterns of a company. Here is a picture of the volume closer up.

Lets move onto a few types of chart types, after reading the book Swing Trading for Dummies, I have been able to understand certain chart patterns a lot more than I did before. Here is some basic information.

First type of chart is a Line Chart. You all remember what this looks like from 8th grade math right? This is pretty much the most basic chart there is. The line chart only shows CLOSING prices over the time period you select, then it connects the dots with a line, therefore you have a line chart. This is an important chart because closing prices are very important.

Next you have the Bar Chart. A little different than the Bar Chart you learned in 8th grade, right? The vertical lines show the high and low for the period you select, and the closing price, whether it be three months, six months, or 10 years. Closing and opening prices are shown by a dash through the vertical line, opening is on the left side of the bar, and closing is on the right side of the bar.

Next you have the Candlestick Chart. This is the standard type, there are hollow and filled Candlestick types also. Sort of looks the same as the bar chart, but it tells you a few different things. It has the vertical line, which is showing the trading range. The difference between this and the bar chart is the candlestick has a box somewhere on the line. Candlestick chart rely on the color to tell you what is going on. Two colors, it varies on what website or brokerage you use, these are run through Fidelity Advanced Chart, using clear boxes that are green, and solid red boxes. The green boxes represent when the price of the stock is up and closes beyond the opening trade. Red represents if the stock traded down for the period. Lastly, if it is colored black (or free) this means the stock price closed higher than the previous days closing price, but below the days open.

Lastly you have a Point and Figure chart, now personally, I don't use this chart as much as the others. It may help you, what works for me doesn't always work for others! Anyway, this chart basically shows price movements. The investors who use this type of chart are not looking at volume or time.

The charts are in order from which I think are most important, you decide which ones you think are more important. Make sure you understand them fully before preparing a technical analysis on a stock!

The photos in the post had to be made X-LARGE so they were big enough to see when published, but when it is published it is too big for the actually space give. Anyway, enjoy.


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Chris Barto

What is Fundamental Analysis of a Company?

What is Fundamental Analysis of a Company?

To me, fundamental analysis is the most important factor when investing your money into a company. This is the foundation of investing in my opinion. Why? Well lets look at it this way, you do not want to invest in a company that cannot beat its earnings, right? You do not want to invest into a company that has a very corrupt CEO or board of directors for that matter, right? Many factors play into this.. Here is what fundamental analysis means.

I'll go over some basics, there is a lot to learn about this type of analysis. The definition of fundamental analysis is, "the examination of the underlying forces that affect the well being of the economy, industry groups, and companies. The goal is to derive a forecast and profit from future price movements." Now that you know this. Lets get started.

The first thing I look for during this analysis are the financial side of things, or financial statements. This can be called quantitative analysis because that means the analysis of a situation, especially a financial market, by means of math and statistical modeling. I mainly look for the revenue, expenses, assets, and the company's liabilities. You do not want to invest in a company that can't handle expenses and liabilities. You want to understand these four aspects so you can gather information on whether they have potential for the future, which will help your investment in them appreciate in value.

Balance sheet, cash flow statement, and income statement. If you do not know what these are, here you go. A balance sheet simply put is the company's assets and liabilities, assets (how much a company owns) and liabilities (how much a company owes). Cash flow statement simply put exemplifies how much cash comes in and how much cash goes out in a given quarter. Lastly, the income statement, this is usually the first statement you come across when researching the company, it shows revenue, earnings, and earnings per share or EPS. These are extremely important when deciding whether to invest or not, you want a return on your money, make sure the earnings exceed expectations. Although these are important, there are some other items I want to touch upon.

When doing fundamental analysis, you want to focus on not only the company, but the industry the company is in, or the sector. You want to make sure the overall economy is strong. 

You could say, fundamental analysis is based off historical and present data/information, but with the data you are making a financial forecast for yourself. 

Fundamental analysis summed up in three types of analysis are, Economic, Industry, and Company. If you can understand these three simple analysis in depth. Then you can put your money to work, rather than you work for your money.

Many more in depth fundamental analysis you can do, and I will leave that up to you! There is a lot of information here to process, I don't want to throw it all at you at once. Take the time and learn before you put your money out there. 

"I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful." - Warren Buffett

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Who Needs Money Anyway?

Who Needs Money Anyway?

Why even worry about having money in the first place? Money does not define who someone is, money does not buy you friends or buy happiness, but it sure does buy you things that make you happy. In a nut shell, you need money. I don't care what anyone says, you need it to survive, just like you need water, shelter, and food. How do you think you supply yourself with those needs?

My favorite quote from Robert Kiyosaki, who is the author of a fantastic book called Rich Dad Poor Dad, is "It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for". This quote is sends a good message, if you want you financial views changed, and everyday life views changed, I suggest reading this book. 

Honestly, I get tired of hearing people say they don't care about money. Those are usually the ones who need it the most. I respect most people in the world, wealthy or poor we are all here for a reason. If someone wants to go off, build a company, become as wealthy as they possibly can, and live how they want and buy some flashy things they worked for, why not? If someone wants to work at McDonalds their whole life and earn minimum wage and hardly support themselves, why not? Life is what you make it, and if you make it flipping burgers, that is okay. If you make it building empires and businesses around the world, that is okay. The only difference, one will be financially stable and one will struggle paycheck to paycheck their whole life. Which do you want to be?

This post is more off topic on investing, but I want to reach out to all sorts of people. Through these posts I want people to learn that even if you work at McDonalds, you can save money. Even wealthy people who own corporations and built empires may not have a lot of money because they spent it all, or can't live below their means and that is why most people go bankrupt. All spend, no save.

Lets do some math, here is an example of someone who smokes a pack per day.

Smoking Cigarettes: Lets say you smoke a pack a day, some States vary in price so I will use around $5.00.

$5.00 X 365 (days in the year) = that is $1,825. Now lets say instead of spending that money on cigarettes, you put that $1825 into a ETF at the end of the year. The following year you made 10% on the $1825, thats $182.50, lets say you reinvested that back in to buy more shares now you have a total of $2007.5, then lets say the market had a down year and you only had a return of 6%, this would give you $120.45. Reinvest that back in and you have $2127.95. On the third year the market performed fantastic, and you received as return of 12%. This would give you $255.35. Added back into the original investment you would have $2383.30.

In three years, on the original investment of $1,825, it grew to be $2383.30. For doing nothing but investing into an ETF that gave you pretty good returns. This is basically a 30.5% return on a small investment, imagine putting even more money into and adding to it each year!

To find out your return on an investment, Final number/Original Investment, or 2383.30/1825 and this gives you 1.305 or 130.5% of what you invested or 30.5% return.

I realize people may not have the money to save, maybe make a list, and cancel some small things out that you could live without, and start saving over a few years and when you have a good chunk of cash saved up, talk to a trustworthy financial advisor and put the money into some safe investments.

Although these returns are very high for three years, it is completely possible. 

Next post will be on the fundamental analysis of a company. 



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Chris Barto

What Kind of Accounts?

What Kind of Accounts?

I would assume you already have some sort of checking and savings account through a local bank, or even a Citizens, PNC, Dollar Bank, etc.. That is a good start, but in my opinion there are better banks to keep your cash at. I personally use Fidelity, but there are many options out there such as E*TRADE, TD Ameritrade, Charles Schwab, and many more. The choice is up to you, each bank has their own commission fees for different investment types, some have free commission when you buy certain ETFs (I will discuss in another post what these are), options trading contract prices (also in another post), you get the gist. Now to talk about a few accounts that you could use to trade in and what the benefits are.

Lets go over the three types of IRAs first, an IRA is an Individual Retirement Account. These types of accounts allow an individual to start saving for retirement with tax-free growth, on a tax-deffered basis. The three types of IRAs are Traditional, Roth, and Rollover, each has their own advantages.

Traditional IRA, you make contributions with money that you are going to be able to deduct on your tax return and any earnings that can potentially grow tax-deffered, until you decide to withdraw them during your retirement. 

Roth IRA (I have one), make your contributions with money that you have already paid the taxes on, and the money grows tax-free (providing you invest wisely and it grows). Then you have tax-free withdrawals in retirement, there are certain conditions that must be met.

Rollover IRA, this is a traditional IRA that is meant for money "rolled over" that was from a qualified retirement plan. They involve moving assets from an employer-sponsored plan, like a 401(k) or 403(b), into the IRA.

Now lets move onto a 401(k). 

A 401(k), is basically a retirement plan sponsored by your employer, wherever you may work. It allows to worker to save and invest pieces of their paycheck before taxes are taken out. The taxes are not paid until the money is taken out of the account. 

Another account that is useful is a JTWROS. 

JTWROS is Joint Tenants with Right of Survivorship, I like to call it Joint WROS. It is a type of brokerage account that is owned by at least two people, where all tenants have an equal right to the accounts assets and both are afforded survivorship rights in the event that a death occurs of another account holder.

You then have your basic checking and savings, to pay bills. I don't personally have a savings account run through any firm, my "saving" money goes straight to investments so I can make more off of it, instead of getting a small amount of interest sitting in a regular savings account. I would rather make 12% per year return my money than hardly 1% in a regular savings account.

The next post will be a surprise. Going to start your monday off with some food for thought.

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Understanding a Company Summary

Understanding a Company Summary

Start the new year with some new knowledge. This year will be a great year for investing, well, for some people. Never have fear in the stock market, especially when you hear "professional analysts" talking about how bad the market will do. Never let someones opinion set you off. Set rules for yourself, invest wisely, and diverse a portfolio, and you will make it one day. 

I will describe each segment in as much depth as I feel necessary for you to understand what they mean if you do not understand already. This is a company summary of Starbucks Corporation or the ticker symbol SBUX. One of my best performers in my own portfolio actually. 

Previous Close means that the price labeled to the right of it, is the securities closing price on the preceding day of trading. It is the value of the stock, bond, commodity, futures, or an option contract, market index, or any other type of security you may invest it from the previous day it closed on.

Open, this is basically the price that the stock opened on at the time of the market. So as you can see here, in the after market, the stock rose $0.03 and opened slightly higher than it Previously Closed.

Bid, this is the highest price in the market for the stock.

Ask, or an offer price, is the lowest price a seller of a particular stock is willing to sell a share of the given stock. 

1y Target Est, this represents the median target price for a stock based on analysts covering and researching the stock.

Beta, any beta less than 1 most likely means that the security will be less volatile than the market (this is usually what I look for when investing long-term), if the beta is greater than 1 the securities volatility will be more than the market. 

Next Earning Date, this is an official public announcement of a company's profitability for a specific time period, usually by quarter or annually. It is usually made on a specific date.

Days Range, this is the difference between the low and high prices for a security or index of a specific period of time. (the day)

52wk Range, this is the securities lowest and highest price at whig a stock has traded in the previous 52 weeks. 

Volume, I gave a brief description in the terminology section on a few posts ago, but this is the number of shares or contracts traded in a security or market during a given period of time. Amount of shares that are traded between buyers and sellers as a measure of activity. 

Avg Volume, this is over a longer period of time, it is the total amount traded in that period, divided by the length of the period. 

Market Cap, or market capitalization, is the total market value of the amount of shares outstanding of a PUBLICLY traded company. This is equal to the share price X the number of shares outstanding.

P/E Ratio, or Price-Earnings Ratio, this is Market Value per Share/Earnings per Share. What this does is it values a company that measures its current share price relative to its per-share earnings. In essence, this can indicate what dollar amount an investor, as yourself, can expect to invest into a company you like in order to receive one dollar of the company's earnings. 

EPS, or Earnings per Share, this is a company's profit divided by the number of common outstanding shares. Easy right?

Dividend and Yield, MY FAVORITE, this is a financial ratio that indicates how much company pays out in dividends each year that is relative to its share price. It is a percentage and can be calculated by using this formula, Annual dividends per share/price per share. Good way to have cash flow throughout the year, use your money to make money! OR have it reinvest back into your security so the your payouts get larger every time and your account grows.

Now next time you go to do research, you can fully understand everything on a company summary! I tend to use either Yahoo! Finance as my go to source to research stocks, or Fidelity (my bank) and use their resources. Whatever firm you use to manage your money, they should have investment research tools to understand everything you need to know!

Hope you enjoyed the read, and I hope it furthered your knowledge. I know for a fact the more I talk about and do more research on what I know I learn more every time! My next post will be about a few different type of bank accounts for investing, well, the ones I think are important!

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