The Tasgall Group

Money Markets are looking really good right now for safe money while we wait for several markets to get over their jitteriness. SECU raised their MM rates to 4.5% (4.6% APR). ING is cruising at 4.35%, but I suspect they will raise within the next 30 days. For parking your money in “cash” in your trading accounts, consider Vanguard’s MM account (VMMXX), which is currently posting a hefty 5.08% yield.

I just drastically scaled back my REIT positions after today’s crushing news from Toll brothers, Bill Gross’ sickening chart (see link within earlier post from Jason) and the additional failure of yesterday’s REIT market peak to hold out. I moved half of my REIT position into equal portions of Money Market (VMMXX) and Total Bond Market (VBMFX).

I’m percolating a blog post regarding REITs but it will take some time to make that post worthwhile.

Entertaining article from the editor of Maxim about becoming rich.  

Most memorable quote from the article:

If it flies, floats or fornicates, always rent it — it’s cheaper in the long run.

I wonder if that applies to the billionaire heiresses?  Surely they do a lot of…flying.  Also, 1-2 million GBP is considered “the comfortable poor” on his scale of wealth.  Ah, perspective.

My mortgage is a fixed loan at 5.375%, yet with the tax deductions that mortgage interest carries, my “adjusted” cost of the interest is equivalent to a 4.2% rate.

If we look at the highest yielding money market or CD rates, we can find some as high as 6%*. This means that I have a theoretical carry trade between my mortgage and a money market account. Wow, that’s pretty cool.

This means I am actually profiting if I choose to keep funds in a money market account instead of pre-paying the mortgage.

Now, unfortunately, this is all theoretical… my money market account only yields 4.35%, so I’m clearing my “adjusted” cost, but not the real cost. I’m also curious if money market and CD rates will stay at this level for more than a year or two.

* Ok, the 6% rate is a technicality — it’s an introductory rate, but you can find 5.5% or better for quite a few CDs.

It was requested that I make mention of the CPA firm that focuses on the needs of active traders and hedge funds. It is Green & Company run by Robert Green, CPA, who literally wrote the book on trader taxes.

Now might be a good time to start thinking about a CD or bond ladder for your short-term or “safe money”. With the FOMC still raising short-term rates, long term rates have had plenty of time to move up as much as possible…

Why ladder? Let’s look at three scenarios: (more…)

My daily routine is non-existant, mainly due to my investment choices thus far. As you both know my focus in on asset allocation coupled with dollar cost averaging within me and my SO retirement accounts. One account gets 2 installments per month, the another gets one installment per month, and our IRAs get one installment per year which I try to market time as much as possible within a range of 1-2 months in the year. My investment options are self limited at this point to index funds, since that allows me the ability to minimize expenses and go along with the research that shows that index funds out perform 80% or more of the actively managed funds. Since I cannot invest in many of the excellent actively managed funds anyway within my employer sponsored retirement accounts, I don’t bother looking too hard at the actively managed funds–not a good use of my time. (more…)

Ever wondered how or where to open up an IRA for trading things other than stocks, such as futures and forex?  Consider a custodial trust company that can approve various types of trading accounts for an IRA setup.  I think as long as the broker can prove that there are automatic safeguards in place that prevent the account ever going into debit such that you owe money, then it can be approved.  This is why margin accounts are allowed because most have automatic margin call procedures that prevent you from ever losing more than the amount in your account.

Here are a few:

Entrust Administration

Equity Trust Co.

Millennium Trust Company

I don’t have any knowledge of these firms to recommend one and there may be more, but these are the few I’ve heard of.

By opening a FXTrade account at Oanda, which costs you nothing, has no obligations to trade and no minimum deposit, they pay 4.7% interest on USD deposits compounded daily.  Four point SEVEN just to have your money sit there.  I don’t think there is a savings account at any bank that can match that while giving you the option to invest in alternative currencies. The only better rate with no minimum on www.bankrate.com was OneUnited Bank at 4.91%.  So for a trading account 4.7% is very attractive.