lvietlboyl

I can't decide on whether to put all $3k in one of Vanguard's International Funds (VWIGX, VHGEX, VDMIX) or put it all in a company stock. I'm looking for short term investment (between 1-2 years) with high returns. Or i can put all that in intel stocks. Reason why i believe intel stocks are going to rise:

-AMD bought out ATI for $5billion leaving them with low cash reserves leaving them with little money for R&D
-AMD has a two front battle between Intel and Invidia
-Intel is leading the technology battle against AMD
-Intel current stock price is almost at their 52 week hi while AMD is at their lowest (i know past historical performance does not matter much)
-With Windows Vista out, consumers will likely upgrade even though vista is still buggy.

what do you guys think? or should i look at other stocks? thanks in advance

im pretty new at this so go easy on me

WyattH

If you're going with stocks... Diversity is a pretty good thing. But $3K makes it hard to diversify much without commissions taking up a hefty %.

I wouldn't put it all on Intel, though. That's just me.

The mutual funds mentioned are good, but I would say are geared more for long term. And you wont see your high returns with them.

We'd all like high returns, unfortunately it's something you can't guarantee.

The common consensus here is between AAPL, RIO, and GS.

* And unless you know other details about AMDs cash flow or how they leveraged their assets to pay for their acquisition, I wouldn't use that bet to say they have minimal reserves for R&D.

lvietlboyl

I know the best thing to do with stocks is to diversify but with my limited playing money its next to impossible.

What commissions are there? I thought the only thing I have to pay is the trading fee which is only $7 using Scottrade.

Are there reasons why AAPL, RIO, and GS are popular among this board?

WyattH

Well if you use a Scottrade account, then yes your comissions are only $7. At that price, there isn't much of a reason to put all your eggs into one basket. IMO, at 3 pics with $1K in each, you reach the same objective of diversity as you would with $30K and $10K in each.
It's when you use a private broker that commissions become a bigger % in smaller purchases.

Yes there are many reasons why AAPL, RIO, and GS are popular here. They are the strongest in their industry, they have relatively low multiples, they are favored by many esteemed/accredited investors, they have high PE ratios, and they either continue to beat their expectations or gain market share.


* But one of the most important things is to go with your gut and only take advice for what it's worth. If you have analyzed Intel and came up with a positive position, then you should act on it. This forum's speculation is nothing more than that, and we can't be held accountable. Follow your instinct.

cthree

You should buy a single mutual fund or indexed fund. $3K is not enough for a viable stock portfolio and is too much like gambling. You can do it but you're out there. Why don't you put that $3K in an IRA?

Your reasoning behind INTC is interesting but unfortunately doesn't account for any of the things which actually matter in the stock market.

1. Intel's battle with AMD results in lower margins (the market hates that).
2. Intel is dependent on CAPX (capital expenditures). Essentially if companies aren't investing their profits in technology and capital goods then it hurts Intel (and AMD) and that is why tech is generally under-performing. What companies are spending their profits on is buying other companies, dividends, stock buy-backs and just generally rewarding shareholders. It can't continue and companies are going to have to start spending on technology but that's not where we are and any money you invest will likely just go sideways for a while. There are surveys done regularly which ask CEOs and officers about their CAPX plans. Watch for headlines about an improving CAPX outlook and then buy stocks which will benefit for it, like INTC. MSFT is also benefit from it, it's a big reason why Vista sales are weak.

lvietlboyl

i have some money in my roth ira and figured i should invest some in short term for my immediate needs. or i could use that 3k like you said and put it in my roth ira. im currently 21 and the compounding interest would work to my advantage until i retire. not sure what to do on this one. any suggestions?

between those vanguard mutual funds i mention above and (dodfx) what do you think is better for short term high risk high returns?

WyattH

Im not familiar with those funds, but most mutual funds are designed to be low risk with low but steady returns.

sahtt

I'd stick to some of the above mentioned vangaurd strategies etc. in your position until you save up some more $$. Some of the above posters really know what they are talking about.

I'm also close to your age and have recently figured out what to do with savings. I have a mix of a few grand in a 6.01% savings account [temporary], vangaurd more permanent, and am currently figuring out some particular stocks to put some $$ in.

Another option more oriented towards what you seem to want 'high return high risk' would require a lot of homework on your part, but is the 3rd way I have put my money away.

You could pick 6 well performing and reputable stocks from 6 different segments [untilites, tech, etc.] at $500 each. This would give you a fee of nearly 50 bucks though, which is nearly 1/3 of your return if you averaged 6% over one year. This would allow potentially high returns while managing risk, the odds of more than one stock completely plummeting is very low while you could see some steep gains you wouldn't normally find with vangaurd etc.

WyattH

I hope you can average more than 6% in a year... Triple that and it'd be pretty good.

And C3 knows what he's talking about. I don't. I'm only 19 also.

cthree

neither of them are short term high risk investments. If you want to fly high there is a lot you need to consider, namely time. A volatile, high risk, high return stock can double in a week and then be worthless the next. If you catch it on the double you're great. Don't pay attention and you're screwed. High risk means high maintenance and unless you're committed to watching the ticker all day you may be better off fishing rather than hunting.

Put your $3K in your IRA. It's not worth the bother. If you get a 30% return in a year that's $900, whoopdy do. Are you really going to monitor it everyday for $900?