Talking stocks, trading, and investing in general

[gettoasty]

Thanks otc

Got some reviewing to do when I get home. I just put the rest of the cash in my IRA into the MJX ETF and was planning on holding for long term (at least > 1 year), just to speculate...and it is IRA money.

And I did manage to get the company to move into R-5 shares reducing the average expense to 0.45 from 1.42, so, not too bad. American Funds is supposedly active management compared to Vanguard passive investing...

Building up a nice Roth IRA now and going forward each year sounds nice especially when you also benefit some from the IRA deduction and essentially zero tax reporting post conversion.

There's alway the loan option through 401(k) also if I absolutely need it.

 

[jbarwick]

Vanguard Wellington is actively managed though is usually not in 401k plans.

As Piob is pointing out, Defined Benefit plans can be gamed and the whole pension industry will be shaken up soon as the returns from investments are not keeping pace with the discount rate applied to the plan. Companies/Governments will likely cut benefits at some point.

 

[venividivicibj]

Should we move this to the ‘Great backdoors’ thread?

 

[venividivicibj]

Vanguard Wellington is actively managed though is usually not in 401k plans.

We have Wellington admiral in ours- I didn’t know it was actively managed

 

[lawyerdad]

Vanguard Wellington is actively managed though is usually not in 401k plans.

As Piob is pointing out, Defined Benefit plans can be gamed and the whole pension industry will be shaken up soon as the returns from investments are not keeping pace with the discount rate applied to the plan. Companies/Governments will likely cut benefits at some point.

Case in point the big CalPERS fiasco 5-7 years ago.

 

[jbarwick]

Case in point the big CalPERS fiasco 5-7 years ago.

Discount rate change or benefits cut? I remember reading about fire chiefs retiring after 15 years with $400K pensions...I wouldn't be surprised about cuts.

 

[ThinkDerm]

just going to put this out there again that you gents should not be sleeping on weed stocks.

last week was illogical how good it was... yesterday and today have been even better. it certainly does need to correct, no question about that... but it's almost all house money now anyways.

admittedly, you cannot use typical fundamentals that you would apply to long-term going concerns. however, for mature investors these stocks are easier to evaluate and hold than digital currencies. better liquidity too.

which weed stocks do you favor?

 

[ThinkDerm]

If you have super boss powers, then you can make sure HR sets up a 401k that also enables you to do the Mega Backdoor Roth...

To do that, your 401k plan needs to allow you to make after-tax contributions (not Roth 401k, just excess contributions to a normal 401k in excess of the $18k limit) and your plan needs to allow you to make non-hardship withdrawls of some sort. Then you stick a bunch of extra cash in there, withdraw it to a trad IRA, and then backdoor it all into a Roth. Between that and the regular IRA contribution, you can stuff something like $40k/yr into a Roth despite being over the income limit (and the contribution limit being only $5.5k).

and how is this done?

 

[otc]

and how is this done?

Google it. The specifics vary a lot by provider and employer.

 

[bings]

which weed stocks do you favor?

i basically made my own ETF before the ETF's came out. sold much too early on APH, ACB and WEED but still did well. The valuations based on production and supply agreements with Canadian provinces is cascading through the sector as it becomes apparent that the market will be structured like alcohol and tobacco up here.

you can decide how much detail you want but basically i am holding all of the mid-cap licensed producers and some of the ancillary stocks. There does have to be a correction or sorts but no telling when it will come and there are literally dozens of near term catalysts to keep the momentum going.

same as with alt-coins right now. you definitely cant use the same metrics you use on traditional equities but with all of the resources out there covering both crypto and legal weed it really isnt hard to understand what is driving pricing and how values and future revenues are being determined.

for weed stocks even the biggest denier cannot seriously think many of these companies wont become blue chips themselves or get acquired by big alcohol, tobacco and pharma companies. it is already happening. just stay away from the garbage stocks. There are definitely pump and dumps but minimal DD gets you around them.

 

[gettoasty]

and how is this done?

The gist of it is to check your summary plan description and check what type of contributions are allowed (limitations) as well as qualified events or age for distributions. Alternatively, if you trust your HR or the qualified plan admin you can ask such questions directly. If they are good the answers should come easy. Can always just refer to the formal plan document with all the plan provisions.

A little more technical, you can always bring up this idea at a company meeting and ask that the company work with the TPA to see how to amend current plan provisions. It will cost the company money to make the change and the company may weigh whether such option will be of benefit to the general employee demographic. What @otc is talking about is not new in the ERISA/DOL space I think but is a matter of whether you employer and plan sponsor thought such provisions warranted adding to the plan during the design process.

The qualified plan space can be very simple like your traditional 401(k) or complex depending on the size and scope of the company.

I think with the new DOL Fiduciary Rule if you bug the company enough and they think it is a good benefit to have, the plan provider/advisor/TPA should and will provide the information.

 

[otc]

Weed stocks might not be looking so good if Jeff Sessions gets his way...

 

[bings]

it's certainly creating some buying opportunities on the US stocks. thus far today the dip on the CDN stock has been largely bought up but there is still lots of hockey left as they say.

 

[gettoasty]

I have no idea. I could see it going either way...once the IRA is rolled into a 401k, they might just say "cool, you don't have any other IRA assets". Or they might say "well, you had them at some point this year, so we are going to tax you". I'd probably lean towards the former, but don't trust me on it.

Just in case anyone was curious, this article explains it well I think. Bottom line is no, you cannot R/O IRA money back into a qualified plan like 401(k) this month, then, contribute trad IRA next month and exercise a Roth conversion. The basis is already calculated as of 12/31/2017 (I think similar to the RMD process). Which means if I wanted to do this, I would need to R/O IRA this year and by 12/31/2018 reduce trad IRA basis to zero. Then, before April 15, 2019 contribute trad IRA and then do conversion to Roth. And if you continue this each year your trad IRA basis is essentially zero, hence, no taxable income on the Form 1099-R.

https://www.marketwatch.com/story/dont-let-the-pro-rata-rule-trip-up-your-roth-2013-10-11

edit:
And to correct myself it appears the initial contribution to trad IRA is non-deductible. I usually refer to this as a non-deductible IRA rather than traditional IRA. Makes sense, the benefit of the backdoor Roth would be too good then. lol

 

[stimulacra]

Not complaining but stocks are on a tear the last couple of weeks… to the point where I'm not sure where to deploy new cash. The only two holdings I have that are down is Chipotle and intermediate corporate bonds.