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The Monday Morning Millionaire Program will show you how to outperform more than 90% of professionally actively managed funds, guaranteed.  At the same time, over an investing lifetime, you can save a year’s income by avoiding adviser fees. Investors can do that by buying and holding a US market index-tracking exchange traded fund (ETF).  For a detailed step by step description, join the Monday Morning Millionaire Program.

Step 1. Open a brokerage account.

There are many stock brokers who would be glad for your business. Adam Smith’s “unseen hand” operates among them; their services and fees are similar. Choosing one at random would hardly make a difference in the long run.

Step 2. Save and invest.

Starting early in life, deposit 10% of your annual income regularly (say monthly) and buy board lots (100 shares) of a very low-cost S&P 500 index exchange traded fund (ETF).  If you start saving later in life, you will need to save a larger percentage. Donald Trump would be richer today had he taken his inheritance, invested it this way and sat in a rocking chair.

There are thousands of ETFs. The key wording here is to buy an ETF which represents the US economy such as a broadly-based index fund. Review Chapter 4 in Monday Morning Millionaire.

The best ETFs to track the S&P 500 are:

1. iShares Core S&P 500 ETF (IVV)
2. Vanguard S&P 500 ETF (VOO)
3. SPDR S&P 500 ETF Trust (SPY)
4. Schwab U.S. Large-Cap ETF (SCHX)
5. iShares S&P 500 Growth ETF (IVW)
6. Guggenheim S&P 500 Equal Weight ETF (symbol RSP)

Each is an excellent approximation of the U.S. economy, the strongest economy in history.

Keep buying board lots regularly. Over a working lifetime, this approach will produce a fund large enough to maintain you in comfortable retirement. Furthermore, you will be dollar cost averaging, the only guaranteed way to beat the market. Follow

https://www.investopedia.com/terms/d/dollarcostaveraging.asp

This core portfolio will allow you to outperform over 90% of professionally managed funds, guaranteed, in addition to saving you a year’s income in fees.

Divide your ETF holdings and cash savings in a ratio that is in line your risk tolerance.

A 50/50 ratio works well for most investors, however, market/cash ratios needs to be individualized.

Step 3.

In retirement, withdraw 1% quarterly from your core portfolio or 2% semiannually or 4% annually and live happily ever after and your portfolio will likely grow. You will never run out of money but you will have to accept a smaller income during the guaranteed occasional market drops.

 

Writing just out-of-the-money covered calls on Novavax (NVAX) every Monday, expiry date on Friday of the same week,  our fearless, intrepid investor lost $US10,990.00 in her “fun” portfolio over the course of about one year. She bought 1,100 shares at $US300 a share for a total of $US330,000.00. Last Friday, September 16, NVAX closed at $US30.41! Her shares would have had a market value of$US9,123.00 ($US30.41 times 1,100) but she got out earlier plus she did earn something from the weekly premium income that she received reducing her losses to the $US10,990.00  mentioned above.

Mistakes are practice shots if we learn something from them. What did she learn from her NVAX experience?

Instead of writing just out-of-the-money covered calls on any security, she decided to write (sell) covered calls sufficiently out-of-the-money to earn about 1% per month. That would significantly reduce the possibility of being assigned!

She likes Intuitive Surgical (ISRG), so she bought 300 shares at $243.7592 per share for a total of $US73,127.76. ISRG will continue to generate premium income even when it declines in the short term.

Indeed, last Friday, ISRG dropped to $US206.28 per share giving them a value of $US61,884.00 for a total loss of $US11,243.76 ($US73,127.76 minus $US61,884.00).

Intelligent investors ignore short-term fluctuations. She likes ISRG and is happy to hold long-term.

What will she do when the NYSE opens at 9:30 AM today?

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1. There are 60 stock exchanges in the world. Most have thousands of listed companies. Most get most investors burned.
2. Sixteen of these exchanges have a market capitalization of more than $1 trillion and account for nearly 90% of global market capitalization.
3. The New York Stock Exchange and NASDAQ have more market cap between them than the rest of these exchanges combined.
4. The New York Stock Exchange is the most heavily regulated, protecting investors from con artists.
5. Nevertheless, the average investor trails the New York Stock Exchange, as represented by S&P 500,  by 40%!

Finally, unrelated to the above, please note that we offer a free half-hour discussion to allow you to see if our one-on-one coaching program ($C300.00  including taxes) interests you. We show how to equal the New York Stock Exchange and how to outperform over 95% of portfolios over a market cycle (peak to trough to peak). Contact me at milan@drmilan.com.

As we frequently state, historically, 1.) over the long term, 2.) properly selected US market index exchange-traded funds, 3.) held in tax-advantaged accounts, 4.) in an appropriate asset allocation, have been the investors best way for growing savings and are likely to remain so for many years.

Note that talk about the US market Index. Year-to-date as of today, it is down 18.80%. If you have not bought into this bargain territory yet, consider it. The Canadian market is down by less than half of that percentage but the Monday Morning position discourages investing in the Canadian market. The reason for that? Look at the chart below.

Time frame	NYSE	TSX
Year-to-date	-18.80%	-8.89%
5-year	+54.80%	+27.54
10-year	+165.12%	+56.30%
20-year	+358.19E	+212.15%

At the beginning of 2005 and at the end of 2012, the New York Stock Exchange in the Toronto Stock  Exchange performance was at the same level. However, during that entire eight-year period, the Toronto Stock Exchange was ahead the whole time. The Toronto Stock Exchange!

Trying to time the markets to take advantage of the better performing one is a fool’s errand. Market-timing does not work most of the time. The Monday Morning program discourages it.

With the habits of the Monday morning program, luck hardly matters. Good luck!

 

 

 

 

First, a thank you to all who gifted a membership or a one-on-one zoom meeting to friends and relatives. We think that they make ideal gifts. Consider it.

And now, our sincere gratitude to all members who took the time to respond to our Friday, September 9 survey about investing in companies that are not environmentally, socially and governance (ESG) compliant.

Time is an irreplaceable resource. We appreciate your involvement.

This is the first time that we have had 100% of our respondents agree with one of the choices offered. We are happy to see such response to the Monday Morning method of investing.

You can see our survey results below.

How do you feel about investing in the S&P 500 given that it has non-ESG compliant companies?
The US economy has created more wealth for more people than most other economies. On the balance, it is doing more good than harm. I have no problem investing in the S&P 500.	100%
I am getting better results investing in individual, E.S.G. compliance companies.	0%

And below, you can see members’ comments.

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Writing just out-of-the-money covered calls on Novavax (NVAX) every Monday, expiry date on Friday of the same week,  our fearless, intrepid investor lost $US10,990.00 in her “fun” portfolio over the course of about one year.

Mistakes are practice shots if we learn something from them. What did she learn from her NVAX experience?

Instead of writing just out-of-the-money covered calls on any security, she decided to write (sell) covered calls sufficiently out-of-the-money to earn about 1% per month. That would significantly reduce the possibility of being assigned!

She likes Intuitive Surgical (ISRG), so she bought 300 shares at $243.7592 per share for a total of $US73,127.76. ISRG will continue to generate premium income even when it declines in the short term. Intelligent investors ignore short-term fluctuations.

What will she do when the NYSE opens at 9:30 AM today?

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One day’s cost of wherever you are going for your holidays or business equals the cost of business-class travel, more or less.

You could start your holidays one day earlier, in your city of departure, by travelling business class.  First to board, first to get off.

Consider it. 

I have done it several times a year for over 50 years.

Milan

Writing just out-of-the-money covered calls on Novavax (NVAX) every Monday, expiry date on Friday of the same week,  our fearless, intrepid investor lost $US10,990.00 in her “fun” portfolio over the course of about one year.

Mistakes are practice shots if we learn something from them. What did she learn from her NVAX experience?

Instead of writing just out-of-the-money covered calls on any security, she decided to write (sell) covered calls sufficiently out-of-the-money to earn about 1% per month. Safe, decent and guaranteed with a significantly reduced possibility of being assigned!

She likes Intuitive Surgical (ISRG), so she bought 300 shares at $243.7592 per share for a total of $US73,127.76. ISRG will continue to generate premium income even when it declines in the short term. Intelligent investors ignore short-term fluctuations.

Indeed, by the closing bell last Friday, September 2, ISRG dropped to $203.67 per share, giving her a total loss on the security of  $120.27 ($243.7592 minus $203.67 times 3). The growth which she was hoping for did not take place last week.

What will she do when the NYSE opens at 9:30 AM tomorrow? (North American stock exchanges are closed today.)

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The S&P 500 is down over 17% year-to-date. Bargain territory! If you have not re-balanced your core portfolio to take advantage of the bargain, consider doing so.

The Muppets are running for the doors. The same people who look for bargains when buying their groceries or clothes for the children or airplane tickets or looking for parking spots are ignoring this bargain.

Muppets (stupid and ineffectual people)? The second largest investment bank, Goldman Sachs, uses the term to describe its clients.

From Greg Smith’s Why I Am Leaving Goldman Sachs: “I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. It’s purely about how we can make the most possible money off of them.”

Investment banks are not our friends. We need to be aware of that even though we do need them to execute our buy/sell orders.

Don’t be fooled by the fact that year-to-date, the Toronto Stock exchange has declined less than the S&P 500. Intelligent investors think long-term. Note the 10-year chart below.

With the habits of the Monday Morning Program, luck hardly matters. Good luck!

 

Over 99% of species that ever lived are extinct. Every species becomes extinct sooner or later and that will include homo sapiens, some day. We will be the first to cause our own extinction. Let us make it later rather than sooner.

Glance at Generation Carbon which an almanac for children. Share it with anyone between the ages of 5 and 18 that you care about.

Sincerely, from all of us at Monday Morning