Tag Archives: sharebuilder

My highly unscientific stock investing method

A few years ago, I opened a Sharebuilder account to test the waters on buying ETFs and individual stocks with my $50 or so a month of leftover savings once I maxed out my Roth IRA. Investing $50 here or there into stocks like MCD and GOOG gave me a little rush… as they were riskier than the index funds the remaining $5k went into every year.

Since I opened the account in 2008, that account has amassed $53.6k in investments. I’ve watched the account lose 30% of its value during the great recession, kept investing at the market lows in stocks that seemed cheap, watched my account hit 25% profit, and return to 7%. Needless to say, my “for fun” stock and ETF account really has way too much money in it now to be “for fun,” but I’m not sure what to do about it.

For what it’s worth, many of my investments are in ETFs or very large companies that tend to be stable investments. I have 24 different ETFs and stocks in the account, including AAPL, AMZN, AND, COMV, CSCO, ENOC, EPI, EWZ, FTR (this was a split from VZ and I own like $3 of it), GE, GLD, GOOG, IHI, JNJ, KOL, MCD, OSTK, PBD, PG, T, VWO, VZ, WFMI, and XLF. (Recognize any of those?)

The worst performing by far is COMV, which is a small cap cleantech stock that has been all over the map. It’s doing really poorly right now so part of me is tempted to sell and part of me is tempted to wait and another part of me wants to buy more because based on my limited knowledge of the company, their history and potential, it seems like it’s cheap at the moment… and even short term it will probably move up again from where it’s at now. I don’t base this on any stock charts so really I don’t know. Shares are about $4.50 right now, my avg purchase price was $6.50, and I own around 700 shares.

On the other end of the spectrum, AAPL has performed very well, but it is SO expensive. I started investing when it was $250 a share, and now it’s around $340 a share. Along the way I’ve accumulated 70 shares of the stock, which really isn’t a lot given stocks don’t just keep going up and up once they’re so far up (do they?)

I’m probably most excited about AND, IHI, VWO and XLF. I wish I bought more WFMI for the long time it was doing poorly and my stock in it was down something like 60%.

I really don’t own a lot of shares of any one stock… COMV with 667 shares is my largest ownership from a sheer number perspective. Next up in my list, XLF, with 281.7 shares. Then VZ at only 119.59 shares. Needless to say, since this is just my Sharebuilder account (not including my Sharebuilder IRA, my Roth IRA and Vanguard accounts, or 401k from my last company) I’m likely over diversified and making poor investing decisions.

The way I look at it, though, is that at least I’m investing. It would be so easy to take that money and throw it away on a nicer apartment or other things I don’t need. At least in the stock market there’s a chance I’ll have some compound interest value on it over time. Then again, it’s extremely risky to put my money in the market this way… even though I am “buy and holding” I’m riding the same market that everyone else who is shorting and buying options and doing all those complicated investing things that I don’t understand in. So it’s hard for a novice like me to even understand what it all means, other than to put my money on as many spots on the roulette wheel as possible, and sit back as it spins.

Is this a terrible investing strategy? Do you have any advice for me?

Making Sense and Losing Cents of the Economy

Like everyone else who has a dime or more invested in equities, I’m concerned about the future of the stock market. Whenever the market looks so bleak, everyone is concerned. And that’s usually the best time to invest. Yet with my yearly investments becoming more sizable, this feels a lot like Las Vegas. Even with diversification, it doesn’t help when all (or most) stocks are on red.

After receiving my paycheck for the past months and reimbursed expenses, I realized that I’m sitting on $16k liquid in my checking account. Part of me hates writing about this because I know I’m so lucky to have the luxury to ask the question “where should I invest?” But this may also be a temporary income boost and I want to invest wisely.

Yesterday, I pulled out my social security statement and studied my yearly income since 2002. Other than last year, I made somewhere between $0 and $25,000 each year. Last year, I broke $60k for a full year’s worth of work. This year as of Sept 1, even with 2 months of unemployment (unpaid), I have earned around $70k this year. And with the way some contracts are shaping up, I expect to make an additional $10k to $30k by the end of the year. So now I face the unlikely problem in a time of economic crisis – what do I do with all this money?

The easy answer is: spend it. Not on wasteful purchases, but things that I need or will need soon. I could buy a new car, or a “new” used car. Or I could invest in property somewhere (though that requires stable long-term income, which I am not confident I’ll have, especially with my plans to go back to school in the next two years.) So where do I put the excess cash?

I’ve already maxed out my IRA and will, within this month, max out my 401k (no match, bummer.) I will likely put another $2000 in my HSA which is invested in very low-risk funds. My IRA is in Sharebuilder and I bought 5 funds – the gold ETF, the silver ETF, two high-dividend ETFs and a REIT ETF. My 401k is invested in a mix of equities and bonds, and I’m not clear what is in it exactly. With a large chunk of my savings this year going into my 401k, I’m concerned that in the next ten years we’ll have deflation, high taxes, and my 401k will turn to mush.

But I’m willing to take that risk with $16.5k because it could be a very good time to invest as well. I’m just not sure I can stomach taking that risk with more money. Not without understanding the real economic situation in this country and the world. History doesn’t always repeat itself, or even if it does it may take a longer time to turn around. I’m young now, I can handle that, but if the next 5-10 years will be lost decade #2, why should I play?

The whole media fueling the fire is disturbing as well. I can’t tell how much of the stocks slipping these days is all the fear stories about how bad the economy is doing. It’s a domino effect that goes in a circle downward. What if all the news resources lied and said the economy was turning around and there’s a ray of sunshine close ahead? If people would invest and spend money than… well, that seems to be the only way to dig ourselves out of this mess right now. I don’t know if I agree with that, but what else can we do? We need people spending again so companies will start hiring again. That’s how capitalism works, right?

But it will take a long time to trickle down to lower and middle classes. The media couldn’t lie for that long. News would get out that the future is not so sunny. And everything would crash again.

Or you can just – apparently – print money until the cows come home and thus make every dollar worth less and less and less. That can’t be a good thing.

Right now lots of big names in economics are saying that we may have a “double dip recession” or – worse? – a depression… because we never actually recovered from the first recession. I wish I understood economics jargon more so I could make sense of this, this, this and this … and the thousands of other economic gloom and doom stories I’m reading.

Any feedback from those of you out there who are more economically savvy?

Dear Investing Newbie and Simple in France

Since both of you left such great comments on my last entry, I thought I’d follow up in another entry to clarify, while still being vague enough to hopefully keep anyone who finds my blog from knowing who I am. (It’s getting tougher and tougher to do that while being 100% honest on my earnings!)

Simple in France recommends that, since I don’t know exactly what my income will be over the year, I budget for one that’s “shoestring” and save everything else. There’s no harm in saving. And I agree. I have a feeling my income this year will double, if not triple the $60k I was making last year. Yes, there is a chance, albeit a small one, that I could even hit $200k. I could also “hit” $10k – if for some reason after a week into the job they end up hating me. Not saying that’s going to happen, but anything is possible. And it’s so easy for them to say so long when you’re not a full-time employee. I can’t count on anything.
I’m trying to continue my goal of having diverse income streams, but it is difficult to maintain more than one job when one is a major 40+ hour-a-week commitment. The good thing about being on an hourly contract is that you’re pretty much limited to 8 hours a day of work. That means you probably won’t be working 60 hour weeks at one job, or if you are, you’re getting paid for those extra hours. So that leaves room for picking up (or keeping) other freelance gigs. My biggest concern, though, is that I’ll be asked to work those extra hours and I’ll struggle to keep the balance of my diverse income streams. At least when I’m in a contract position I feel like it’s fair to accept other work (unless the contract is salaried and specifies they own you for a set period of time). I never want to only have one income stream, I know I can be laid off at any time, or a company could go under. I don’t care how much I’m making at one job, I need something else that at least covers the rent and minimal food just in case. At the moment, I have a part-time contract gig that moved from 8 hours a week to 16 hours a week recently. That pays slightly less than the 40 hour a week gig, so if I had to chose one to keep it would definitely be the 40-hour-a-week one. But there’s no harm in working 4 hours extra 4 days a week (or spreading out my time even more) to save more money. And that’s my goal. Save as much as possible this year. I’ll probably — best case scenerio — get myself into a ridiculously high tax bracket, have to pay self-employment tax on some of my income, and end up earning not as much as I could have at a lower-paid, full-time job with benefits. But, I think it will work out ok, as long as I can keep this all going. And I’m going to make this work somehow. To prove to myself I can. And to save a lot of money. Because right now I’m either look at going to grad school or buying a condo (???) in the next 1-2 years and I don’t mind keeping my spending low to increase my savings.
Investing Newbie asks if I know what I’m guaranteed as income, and that I should budget based on that. Yes, and no, is the answer. As stated above, in a contract role “guaranteed” for only half the year, the most I’m guaranteed for — even if I am amazing at my job — is 6 months worth of work. They also are perfectly free to tell me that they don’t want me to come back in to the office at any time. They could even tell me that before I start my first day. I doubt they will, but I accept weirder things have happened. Then, my other income streams, while smaller, are a little bit more predictable. I have a blogging gig which, at the most, can bring in $500 a month. That I’ve been doing for a while. I got behind badly in Feb but did well in March. I just need to get up early and spend about 30 minutes to write a blog post for 20 posts a month. It’s totally do-able. That gig is probably the most stable of them all, but the company that runs the blog could chose to shut it down at any time. Then there’s the 16-hour-a-week project I noted above, which is sort of guaranteed at 16 hours per week for the next two months. It’s with a stealth startup where I’m doing some writing work that I can basically do whenever (ie, night time, after work, weekends.) That also could end at any time. So the simple answer is — I have no idea what my gross income will be for the year. There’s a good chance it could be way more than I’ve made in the past. There’s a chance it will be less. I don’t know what to plan for. Other than to plan for a little bit of income ($35k about) and budget off of that.
Investing Newbie also writes that I could open up a plain savings account with a good rate and save up money for 40+ years or to invest if I feel comfortable with it. I do have savings accounts and investment accounts, and I plan to split my earnings among those accounts. Since I started working, I’ve put $5,000 a year into my Roth IRA, but if the best-case scenario works out this year, I won’t qualify for a Roth. Again, not the worst problem in the world to have, but I would like to put money away for retirement. I also don’t want to put everything away for retirement because — as I said — I either want to buy a house or go to grad school in the next 1-2 years. So where does that savings go?
Up until now, I’ve been fairly aggressive in my Sharebuilder investment account, in terms of stock and ETF purchases. I started slowly and was down a lot (like everyone else) when the markets crashed, but kept investing when they were down (bought a lot of a few companies I thought were on sale) and am now up 25% and have an account worth about $10k total. Still, I only invest $100-$400 a month. It would be a lot harder to put $2000 a month into my volatile stocks and ETFs. I also have a Vanguard account (besides my Roth IRA) that’s just a mid-cap index fund. It’s doing ok. I could put more money into that (or open up another taxable Vanguard fund) but I’m still a little nervous for shorter-term investing. Granted, I’m young enough where if my networth goes down I can recover. Maybe I’ll have to take out a bigger loan for grad school or not buy a house in the near future, but it wouldn’t kill me. I’m fine renting and living with roommates. I don’t need a lot to be happy.
So, yes, I could just put whatever extra money I make over my shoestring budget and put it directly into a basic savings account or FDIC-insured laddered CDs. I’ll probably lean more towards investing anything over my monthly expenses. I think for the first time in my life I’ll have access to a 401k plan (though I’m not sure how good it is) so it probably makes sense to put some money away pre-tax. It’s SO HARD to figure out if that makes sense, though. If my yearly income is less than $80k (or whatever the cut-off is for a single person this year) I am better off funding the Roth IRA first. But if it’s more than that, the 401k makes a lot of sense. I probably won’t know until next December which of those will be accurate. I guess there are ways to fund one thing and move money around until the year is over, but that’s a huge pain. I’d like to just pick something and stick with it. The Roth IRA has been the no-brainer for the last few years, but it sounds like I should take advantage of the 401k while I have access to it.
Other places I could stash my cash? The 529 plan (which has, like, $1200 in it right now (enough for – what – one month’s worth of MBA textbooks?) which is only free from federal taxes… I could buy a condo now and give up on my grad school dreams… and also trust that I can continue earning some decent income for the next 50 years, I could put about $2500 more into the HSA plan which I may or may not continue… I’d have to get it in there before I cancel the insurance, and pay a yearly fee forever to keep the account open, but that’s a place where I can put pre-tax money and not have to pay taxes if I use the money for health expenses… and that makes more sense than the FSA which is also available with my new employer. I don’t like the idea of FSA’s since you lose the money if you don’t spend it at the end of the year.
Anyway, I’m going off topic. I’m in a good situation right now all things considered, but the way I look at money, and savings, is drastically changing. I don’t understand how to lead a six-figure lifestyle. Especially one that isn’t guaranteed to be a six-figure lifestyle. It’s fine to live this year like I’m making $35k and ignore anything above that I make. But when in my life will it be ok to stop and live a slightly nicer lifestyle? Go for a massage every once in a while? Buy a good road bike? Get a better car (mine will die soon, so I will need to invest in another car anyway)? Sign off on a condo or small house? All these luxuries… at what point in income and income stability do I need to be at before it’s ok to spend more than a shoestring budget? Or is the key to never do that, no matter how much money you make?

How much should I save and where should I put it?

Lots of my readers think I’m a spoiled brat with a spending addiction, and occasionally I get a comment along those lines. Part of the reason I started this blog is that I agree with that statement and I’m trying to be smarter about my finances. Without the PF world I probably would be in debt by now instead of having $45k in savings. Yes, I have a shopping addiction. Yes, I need to stop making excuses for buying expensive clothes. Yes, I need to focus on saving more. But my biggest problem is not knowing where to save. It’s not the best excuse, but it’s true.

I can easily put away $5k per year in my Roth IRA because I always save up that much the year before (I overestimate on my taxes and pretend that money doesn’t exist) but beyond that I am not sure where to put my savings. Spending the money is, sadly, a lot easier than figuring that out. Again, an excuse, but I really don’t know where to put my money. With no 401k at work, I’m not sure where I should save. Do any of you have ideas for me?

I have some automatic transfers set up. $100 / month to ING Direct liquid emergency fund, $50 / month to Sharebuilder, $50 / month to my 529 plan. I’m not really sure how to save for retirement beyond my 401k or if I even should be saving more than that right now specifically for retirement. If I could figure out HOW MUCH I should be saving and WHERE I should be saving it, believe me, it would be a lot easier to save it.

My current accounts…

Checking: $375
Basic Savings Account: $301
CD / Emergency Fund: $8,073.49
ING Direct Savings / Liquid Emergency Fund: $3000
PayPal: $70

Roth IRA: $14,482
Sharebuilder Stocks & ETFs: $9,801.43
Vanguard Index Fund: $4113.69
Vanguard 529 College Plan: $890.44
Lending Club: $555.95
Prosper: $233.10
HSA: $1000

Where on earth should I be putting my savings and how much should I really try to save each year?

Savings 2009 Update

Since I don’t have a 401k, I’m always paranoid about not having enough saved for retirement. I know they advise workers to put at least the % match in their 401k above and beyond their Roth, but without a 401k, I’m still at a loss for where to save my money. Also, with grad school in the future (2-5 years away) I don’t know how much to save for retirement vs. that. Oy.

To be honest, beyond my Roth IRA, which I max out at $5000 each year, I don’t keep great track of what money goes into my other savings accounts. I save, I probably save quite a bit all things considered, but I haven’t really looked at what that means until today.

This year, so far, I’ve put $4850 in my Roth IRA. I have invested $5000 in ETFs and stock purchases in my Sharebuilder account. Plus, there’s about $600 in my 529 plan. Ok, so I think I stashed away $10k this year, or more. That’s not too bad. Then again, I know people who are saving 30% or more of their after-tax income. Which would be probably more like $20k.

Granted, I lie to my net worth spreadsheet and tell it to deduct more taxes then I will need to in order to have a fiscal boost come April 15. But that usually goes straight to next year’s Roth IRA. I always like to start it out with a $3000 one-time investment in April, then add in for the rest of the year until I hit the $5000.

I really wish I could buy a house right now, but besides not having the money to do that (I only have $30k saved, and much of it is in retirement accounts) it just wouldn’t make sense. So I’ll keep throwing away $600/month on rent. I was at my friend’s house yesterday — the one she bought with her engineer fiancee — and I’ll admit, I’m a bit jealous. But then I remember I don’t NEED a house right now. What would I do with a giant house besides pay a lot in bills and make a mess of it?

Spending and Saving & Saving or Spending

I know it has been a while since I updated this blog, and I wanted to let you all know I’m A) not dead and B) doing fairly well, financially speaking at least. I’m still employed (knock on wood) which is an incredible feat in this economy and one that I’m both proud of and grateful for.

While I haven’t stuck to my budget as planned exactly in the first half of 2009, I’m not overspending. I’ve been pretty good at avoiding shopping malls and spending on things only when I have to, with the exception of an occasional splurge.

My big expenditures this year so far have been laser hair removal packages (approx $2500 for armpits and face, thanks PCOS), quarterly flights across the country to see my dad (he’s in the late stages of cancer so it’s worth it), and a few classes at the community college both for career growth and fitness. Gas is still costing quite a bit with my rehearsing for a production about a half hour away from my home, but it’s not too bad. Maybe $100 – $150 a month.

Food wise, my costs have gone down quite a bit. My boyfriend and I are determined to get healthy so we barely ever go out to eat. I do spend quite a bit at whole foods but even with those expensive shopping trips my food budget, which has surpassed my clothing budget, is not that huge.

There are some larger purchases I’d like to make, namely a new pair of glasses and a better bike, but I’m holding off on both until I find the perfect ones. I also would like to get laser hair removal for my legs and bikini area, but that gets extremely expensive fast.

My rule, that I’ve been trying to follow, is that whatever unnecessary large purchases I make, I need to first earn that money above and beyond my salary. So, for instance, my blogging income goes to things like really nice glasses or that new bike. I don’t have enough freelance gigs going on to earn money fast enough, though, which kind of sucks. My blogging gig could feasibly earn me $600 a month at most, but I usually make more like $100 or $200. I used to have a good monthly writing gig for my uncle where I’d make $400 a month but with the recession all those jobs have dried up.

Some days I’m curious about what would happen if I found a new job, as I think I could probably find one that’s better paying given my experience now. But I also really love working in a company that’s up-and-coming, and for what it’s worth I don’t care about my salary that much. Well, I do, in that I’m no longer working in journalism or non-profit, where I’d be lucky to break $40k / year. I’m happy where I am now, yet not sure where I go from here. Taking the GREs this fall, considering grad school still, but I’m scared of all the change. I’m FINALLY feeling happy (usually) and settled and I don’t know if it’s worth it to go through the trouble of applying to grad school, the anxiety of waiting to see if I get in, the anxiety of getting in and worrying that I’ll be in over my head, and so on. So I’m starting with these community college classes hoping they’ll help lead the way. And re-learning math so I can get a decent GRE score.

Well, that’s my life in financial terms right now. It’s ok. I’m not saving enough probably, but at the least I’ll max out my roth IRA this year, I haven’t spent any of my HSA funds that my company contributes $100 / month to yet (though I probably should!) and I’m putting about $200 / month into my sharebuilder account. So I’ll be saving about $7000 this year, I guess. If I go to grad school, that’s not even a semester’s worth. So I kind of don’t want to go to grad school. But I also don’t want money to hold me back… after all, people DO go to grad school, and not everyone is from a super rich family.

A Look at VGMIX (Vanguard Mid-Cap Growth Fund)

While I have a fairly good idea of what’s going on in my Sharebuilder account, it makes me uncomfortable to have no idea of what stocks my index funds are invested in. So every once in a while I plan to research my funds and see what stocks are in them.

I randomly decided to invest in VGMIX in a taxable account. Maybe a bad idea. Since I’m maxing out my Roth IRA currently with two vanguard accounts — Retirement 2050 and the Total Stock Index funds, I needed some place else to put my money. Perhaps all the rest of it should somewhere else.

VGMIX lost 47% last year (yikes.) So much for growth.

As of Dec 31, 2008…

VGMIX had:

231 stocks
$4.0B Median Market Cap (what does this mean?)
Price/Earnings Ratio 13.0x
Price/Box Radio 2.3x
Yield:
Investor Shares: .6%
ETF Shares .8%
Return on Equity 20.2%
Earnings Growth Rate 26.0%
Foreign Holdings 0%
Turnover Rate 54$

Sector Diversification

Consumer Discretionary 13%
Consumer Staples 3.9%
Energy 8.1%
Financials 5.0%
Health Care 17.5%
Industrials 22.8%
Information Technology 19.5%
Materials 4.9%
Telecommunication Services 2.1%
Utilities 3.1%

Largest Holdings (approx 1% each):

C.H. Robinson Worldwide Inc (air freight)
Fluor Corp (construction and engineering)
Laboratory Corp of America Holdings (healthcare)
Expeditors International of Washington (air freight)
Humana Inc. (managed healthcare)
Rockwell Collins (aerospace and defense)
AutoZone Inc. (automotive retail)

Apparently a fund provides a complete list of its holdings four times a year, as the quarter ends.

I hold a very little bit of a lot of different companies. Then there is a lot of other information that I do not understand. Hmmph.

Even if investing in single stocks freaks me out, I do like knowing what I’m investing in.

Speaking of investing in solo stocks and ETFs, I just bought more of COMV and IHI today. I hope that was a good idea. I feel like COMV maybe has great potential but I just don’t know enough to say. It’s in a good space that I believe has potential, but when it comes to the company’s ability to make a profit – I have no idea. I do know that they were down to $3 a share a few months ago and now they’re at $7. I’m still upset that I didn’t buy more when they were at $3.

When it comes to investing, I’m fucking clueless.

But that doesn’t stop me from doing it. At 25, I have at least 35 years until retirement. So I just have to believe that over time, the markets will go up.

Regardless, when it comes down to picking stocks and ETFs, I’m shooting blind. And maybe that’s best. The market rallied a bit this week. My new thing is to try to invest heavily on the weeks when news is all doom and gloom, and hold back weeks that it picks up. Not that I’m really trying to “time the market” — I invest monthly, but I do try to guess at the best spot per month to put in my money. I’ve got it on auto pilot at Sharebuilder, and it only invests on Tuesdays, but I don’t put money in on Monday until I know we’re off to a bad week.

And that’s kind of working out. For now. My Sharebuilder account (which is my “fun” investing account to see if I can beat the market) is now down “just” 30.30% Buying stocks and ETFs the last two months has helped — the only way I’m going to make back the money is to invest when the market is doing its shittiest, and hope that it goes up. I’m just worried I’m too diversified. But I do that because I don’t know what I’m doing.

I own 11 different stocks/ETFs in my Sharebuilder account. Not sure if that’s too much or too little. I need to stop getting excited about different ETFs and stocks, putting $100 into them and then moving on. It’s time to really hone in on my better performing stocks and invest in them. My ETFs are actually the worst performing right now, except for maybe Whole Foods. But then again they go up and down and up and down, so who knows.

My gains and losses sheet on Sharebuilder is all red except IHI – the medical devices ETF I just purched a small amount of two weeks ago. That’s up $8. It’s refreshing to see something green on that page.

The account has lost $931.03 to date. The more I invest now, the more likely that in 35 years I won’t remember how scary it was to lose that much money that fast. (Not counting the $7000 that my Vanguard accounts are down, give or take a few hundred on the given day.)

I wish I had more appetite for risk… because a year ago I would have shorted the market and today I’d put more money in. But I’m, you know, only able to stomach $10k losses a year at my current payrate. Maybe more next year.

How My Stocks are Faring

In short… not so well.

In long… ignoring the $7500 I’ve “lost” in my Roth and Vanguard index funds, I’ve lost another $1051.99 thus far. I have invested in 11 different stocks and ETFs in my Sharebuilder account ranging the gamut from a gold index to a natural foods supermarket, and everything in between. Not one of them is in the “green.”

The best performing is my gold ETF (GLD), which is down $10.95 on a $533 investment. Not bad, but it’s also not making money.

Everything else is doing really shitty.

Here’s my investment list, and losses:

Comverge (COMV) – Invested $205.51 thus far, it’s currently worth $115.96 (loss $89.55)
Wisdomtree India Earnings (EPI) – Invested $482.59, now $262.56 (loss: $220.03)
iShares Brazil Index (EWZ) – invested $251.72, now $104.30, (loss: $147.42)
SPDR Gold Trust (GLD) – invested $533.67, now $522.72, (loss: $10.95)
iShares Medical Devices (IHI) – invested $150 recently, now $146.58 (loss $3.42)
Market Vectors Coal ETF (KOL) – invested $120.26, now $32.76 (loss $87.50)
McDonalds Corp (MCD) – invested $296.74, now $273.41 (loss $23.33)
Powershares Global Clean Enegry – invested $462.31, now $195.88 (loss $266.43)
Procter & Gamble – invested 100.00, now $89.03 (loss $10.87)
Whole Foods Market (WFMI) – invested $121.23, now $36.33 (loss $84.90)
Financial Select Sector (XLF) – invested $148.29, now $41.20 (loss $107.09)

For a grand total of…

-$1051,59.

or -36.61% of my total investment.

For what it’s worth, I’ve invested $14,950.00 into my Roth IRA and Vanguard Index Funds, and I’m currently down $6849.33 on that account, or 45%.

So even though my stock picks are doing crappy, they’re still doing better than my basic index funds for now. I wonder how they’ll all look in a year from now.

Lending Club: My 2009 Money Challenge

Each year, I like to try something new in personal finance. I don’t want to waste money, but I don’t mind testing the waters a bit with a small percentage of my income. Last year, my big test was on Sharebuilder… and my stocks obviously have not performed well (except Mickey D’s (MCD) that’s at least not losing money).

This year, I’ve decided it’s Lending Club’s turn for a little game time. I finally figured out how to use the site (phew) as last I was on I thought I had bid on two loans and apparently never made a final order. Oops. So I’ve now made a final bid/order on two loans for $25 each and I transferred in $200 from my paypal account.

While I don’t think Lending Club will make me rich (and I have little faith I’ll do better than break even given my luck on Prosper), I do like that you can lend just $25 per person. So you have a little more room for less costly defaults. Of course, then you also have more loans to default. I’m not mathematician, so I’m not sure which is better.

Regardless, I’ll start out with this $250 and see where it gets me. I’m also going to up my investing on Sharebuilder this year. I can’t resist a good sale. Thinking about purchasing some Proctor & Gamble stock, but not sure. Any stock I buy now will lose money over the coming year or two, it’s just a matter of how it looks in 3, 4, 5 years down the line.

At least with Lending Club I’ll either get my money back in 3 years or lose it in 3 years. With the stock market… I could make money and it could be gone in 10 years… as we’ve seen in the last 10 years. And I don’t really have much faith in banks or the ability of anyone – even Obama – to stimulate the economy. Of course, without such stimulation, even P2P lending is at risk – big risk. If jobs get cut people can’t pay their bills, even if they really want to. That’s just how it goes. So I don’t want to put too much money into P2P… just enough to see if Lending Club is better/worse than Prosper.