| Search by tag or site | Login to my blog ? Start my own blog |
 |
Millionaire Now! by Larry NusbaumThis blog is based on the organizational principles found in my new book, "Millionaire Now! - A Financial Toolbox with Seven Steps to Wealth". |
Stocks Vs. Real Estate: "YAWN" - Follow-up
AS A REFRESHER: Stocks vs. Real Estate: "YAWN"
Some additional thoughts:
The S&P 500 index is something that no one buys and keeps. Two of the best known stock investors in the country are William O'Neil and Warren Buffett. They would never buy any index. O'Neil buys 4-5 stocks and Buffett around 20.
The stock market(s) are national or international markets. Not so with real estate (housing). They are local markets only. So, it's like asking, "is it faster to N.Y. or by bus?"
So, on that basis, does a commercial RE investor in L.A. care what the Denver condo market is doing? No. But, a stock investor must always worry about the right time and/or right sector of the market to be in.
READ: Get A Grip - On a Real Market not a Trading Environment
In 2005, the Phoenix housing market returned a stunning average appreciation of 46%.
Point. Set. Match.
The SPX is at 1480.93. I can buy it today, with cash, hold it and get religious: start praying. I get no discount.
There is no reason why I can't buy real estate at huge discounts from the outset, take the property to a higher use and beat my market's averages routinely....and I do. Can't be done with public equities. After you buy, the price will move up or down despite your prayers.
The public trusts property because of it steady record since 1930 and low volatility. Not true with stocks.
With stocks, strict sell disciplines must be in place. With real estate you need strict buy disciplines.
Please keep another point in mind when analyzing stock returns over time: According to the Frank Russell and Co, the “manager of managers”, the S&P 500 (10.2%) and the average fund manager (12.2%) has outperformed the average investor (2.7%) over the past 30 years. Why? Because, individuals who handle their own accounts tend to make too many moves and at the wrong time greatly retarding long-term performance. The point being that unless you own managed funds or index funds, you will not achieve any where close to the returns used in research reports comparing stock market returns to other asset class returns over a long period of time.
Housing Bubble and Real Estate Market Tracker from SA for 4/24
other news:
- The National Association of Realtors (NAR) reports: Weather Hits March Existing-Home Sales After Three Monthly Gains.
- From Marketwatch's "Protecting your value as foreclosures rise: Tips to buffer your home's worth if you're near an empty property".
- From Reuters: US new home market may take til 2009 to rebound-S&P.
- From Realty Times: NAHB's Chief Economist Releases Housing Forecast.
- What Does The Market Meltdown Mean To You?
- Magazine Cover Indicator Is Here
- Today's Open: Bounce Up
- Canslim.net Morning Comment And Links (for Traders)
- How Certain Investments Did Last Week
- October 2008
- September 2008
- August 2008
- July 2008
- June 2008
- May 2008
- April 2008
- March 2008
- February 2008
- January 2008
- December 2007
- November 2007
- October 2007
- September 2007
- August 2007
- July 2007
- June 2007
- May 2007
- April 2007
- March 2007
- February 2007
- January 2007
- December 2006
- November 2006
- October 2006
- September 2006
- August 2006
- July 2006
- Millionaire Now!
- The 7 Steps to Millionaire Now!
- Build Your Financial Plan
- RETIRE RICH: Survival Guide
- ASSET ALLOCATION MODEL
- THE BIG ROLLOVER IS HERE
- THE END OF THE GRAND SUPERCYCLE?
Made several great trades today. Traded the QID, QQ [read more]
When I first started Day Trading I traded anything that [read more]
Written by S. Wade Hansen Why Should You Care About O [read more]
<< My Home | TheMoneyBlogs Home