Glen Doth Know

The purpose of this article is to outline my quest for the cheapest broker that lets me “do what I want” with the least amount of hassle and how the real hassle is always behind the scenes. I’ll also outline the public companies from the perspective as an investor.

I currently can trade with Firsttrade, Schwab (SCHW), Ameritrade (AMTD), E*Trade (ETFC), Merrill Lynch (BAC), and I have checking accounts with Fifth Third (FITB), and a savings account at Bank of America (BAC). So, what’s the scoop and why am I writing this article? I’ve been setting up a new E*Trade account for the past month and my patience is wearing thin. Why did I choose to open another account with E*Trade?

Merrill Lynch (BAC) won’t let me buy stocks less than $1. This is to protect me from myself, I suppose. But what happens when a company that you value over $10 goes below $1? Odds are you’d like to buy more and now your left buying it at a higher price of at least $1, whenever it surfaces back above that waterline. All for $29.95 a trade. What a great deal! Not.

Ameritrade (AMTD) has the best interface and is honestly in my opinion the best, except for that it won’t let me buy certain penny stocks because it doesn’t like the transfer agent. I fought Ameritrade on this a little bit, because if they would simply let me buy the companies that I want to buy, I’d push all my accounts to them.
Schwab lets me buy pretty much anything I want, but Schwab has proven to be a little more hands on than what I’d like them to be. I got a margin call on a $30,000 account that was over half marginable securities and we were sitting on about $1,000 of margin. That’s pretty ridiculous. Also, Schwab is more expensive than E*Trade.

So, here I am, setting up another account with E*Trade (ETFC) because I know it will be the most flexible once I get it going. I’ve been trying to set up this account for over a month now and have made a frustration timeline that you can see below. I’m still in limbo and haven’t received a phone call from E*Trade. I’ve had to take the initiative to call them up and follow up as to where exactly the money I sent them is. They still aren’t sure, so there is roughly $115,000.00 floating out there in E*Trade land.

Alright, how do these companies stack up as far as investments go? I would say that Schwab (SCHW) and Ameritrade (AMTD) are reasonably priced. Bank of America and Merrill (BAC) still appear to have over 100% upside potential within the next year and so does Fifth Third (FITB).
Lastly, I’ll note that I’ve been asked by a couple Fifth Third employees what I would consider investing in. I asked them if they had ever considered buying Fifth Third (FITB).

Disclosure: Glen and his investors own FITB and BAC.

Labels: BAC, FITB

100% in 1 Month Financials
By
Glen Bradford

I think that if you’re a professional money manager and you don’t make 100% return in 1 year starting today --- you should look into other forms of employment.

Jim Cramer is right. I’m going to stand up and shoot for 100% in 1 month with a couple stocks. All of them are set for huge gains when the mutual funds grab them at $5.

Conseco (CNO) --- I’ve been yelling about this one since $0.33 when I backed up the truck. I came up with a 2009 EPS of $0.85 weeks before the analyst updated his estimate to include the restructure I forecasted. You too can ride this to $7 --- more than 100%.

Genworth Financial (GNW) --- They didn’t need the TARP. That’s a sign of strength. Just popped to $5. Next stop: $12. Get ahead of the curve and allocate your holdings where the money is heading next. Don’t wait!

American Capital (ACAS) --- I am anticipating a restructure of their current debt obligations. Note that this can bring back a huge yield if you sit tight. Odds are the restructure will eat out of short term (1-2 years) profit margins, but the stock price will soar. $8 is just around the corner.

I don’t respect people that recommend things that they themselves do not own. That’s why I’m long all the companies mentioned in this article. If you’re interested in banks, shoot the middle of the road and start with the ones that are down the most over the last 2 years and up the most over the last 2 months. That way you’ll pick up bargain banks that hopefully aren’t dead beats. A couple that I own are Fifth Third Bancorp (FITB) and Huntington Bancshares (HBAN).

Disclosure: Glen and his investors own CNO, GNW, ACAS, FITB, HBAN

Glen Bradford
Purdue Industrial Engineer
Masters in Business Administration
www.glenbradford.com

Labels: ACAS, CNO, FITB, GNW, HBAN

By Mark Bradford

I am just about an easy-going guy as you can meet.

Sure I get excited when I am in charge of something or other similar times, but for the most part I’ll just move over or stay out of the way when people try to use their perceived power on me because, quite honestly, life is too short to bother with the small stuff.

I have always believed most of what people told me anyway. My dad said “Save your money, son” and so I did. My mom said “Eat your vegetables” and so I did. My professor told me”Invest $250/month in the stock market and you will be a millionaire at the end of 40 years because the stock market returns about 9 percent annually, give or take.” So I did.

In fact, my wife and I invested $500 every month, through thick and thin and sending three kids to college. Like the rest of us, we watched as our life savings seemingly disappeared this past winter, even though they were placed in "safe" mutual funds. Being the easy-going guy that I am, I just shrugged and said, “Give it time, it will come back.”

So I did. That was OK until I watched a 60 Minutes episode in which they detailed how all the mutual fund managers were getting rich despite the bad economy. All of it was and still is perfectly legal, of course. They were still charging 3-5 percent management fees despite incurring huge losses through blatant mismanagement of MY money.

MY money. I have a son who is a budding investment guru. His “practice” portfolio (which included $50,000 of our family money) took a dive this past winter, too. But his losses were approximately equal to or less than my “professionally managed” funds. So, a college kid still wet behind the ears was able to think just like “seasoned pros” who supposedly have my best interests at heart.

My ass, they do. It suddenly occurred to me that every does time I was paying 3-5 percent fee just to dump money into their fund, I was losing money and they were taking (not making) it. They were the ones living the high life and vacationing in Hawaii while I spent two months trying to figure out how to pay an unexpectedly high tax bill.

Then it occurred to me that I didn’t HAVE to let these overpriced underachievers invest my money for me. If I was going to lose an automatic 3-5 percent upfront, I wanted to do it myself. I already had my Internet brokerage account and access to CNBC (my guess is the fund managers are drinking lattes and not watching Squawk Box in the morning). I am able to track the market on my own and, in fact bought the financials at historic lows and have a selling strategy in place.

And I don’t charge myself 3-5 percent. So, I called my IRA mutual fund holder and told them to get me out and send the cash to my discount broker. I filled out all their indecipherable forms and am now waiting for the cash to hit my Internet account. In fact, I have been waiting two weeks for these highly paid mutual fund managers to write a check and get it done. Great service.

When that happens, I will work with my son to choose the most effective accounts for long term growth and stability. I will have my ups and downs and I will make mistakes. But I can pretty much guarantee that if anyone gets a chance to live in the Hamptons on my 3-5 percent this time, it will be me.

When I was in high school in the 1960’s it was a popular phrase to say “Stick it to the man.” Little did I know “the man” would be disguised as some greedy mutual fund manager and that he would bleed me slowly and make me like it.

My change of heart is just my way of sticking him. And I hope others do too.

By Mark Bradford

Labels: AIG, C, FAS, FITB, HBAN