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Author: Crosenfield Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35397  
Subject: Re: Since You Asked Date: 2/17/2012 12:13 PM
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Forty years ago, my portfolio was nearly 100% bonds.
Five years ago it was 70% bonds, and I was still working. Now it is 60% equities, and I've been retired for 3 years. The party line says as you age your portfolio should get less risky, and that is translated into owning more bonds, less stock.

But with these crazy interest rates, in my not-so-humble opinion, bonds are more risky than stocks. But the stocks have been on a tear also. I look at returns and wonder whether it would be possible for me to make a million dollars a year? If there were no down days, yes. Ain't gonna happen...

Selling covered calls on stocks is a mildly bullish position. You've sold your top. If the stock runs away to the upside, it will be called, or you'll spend a bunch buying your call back. If the stock crashes, the premium doesn't compensate for your loss on the stock. If you select your strike well, either the stock just misses getting called or it gets called, you make money on the position and can either buy the stock back at a reasonable price or you go buy another stock. So buy/write positions did well in 2011. So yes, for the past year or so I've been mostly fishing in different waters...in the past 2 years a lot of my bonds have been called. I bought new, energy-efficient windows for my house, and a bunch of stocks, which have done well. Fish in different waters? Absolutely! But with a bunch of money coming in I will keep in touch with the bond market also. Charlie's finding stuff worth buying, it must be out there, but it sure as heck isn't treasuries, and I haven't seen anything in munis worth buying, either. Charlie's idea was to pay attention when names appear on the lists of bonds available that aren't usually there--good point. And I know the e-Trade lists well enough to recognize such, if I happen to be looking when it appears.
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