How to buy a glider affordably - redux

FROM 11 MONTHS AGO:

Only point was that one would need to know your predictions
for what to do for, say, the past 10-20 years to know
if your 2005 prediction was good or just lucky. Stock
newsletter writers have used 'survivor bias' in market
forecasting for years - trumpet your successful calls
and hide from the rest.

But rather than trying to go back a decade, we can
just start now. For those considering buying gliders
later in 2006, what's your forecast for the $/Euro
rate 12 months from now?


Well, I started about 35 years ago, but who's counting?

For the next 12 months I predict that the Euro will
continue its
decline, probably leveling off at a $1.05 to a $1.10.
I would
definitely not hedge the Euro, however. I would - and
will - keep a
substantial portion of my holdings in the ContraFund
(but I also own a
couple of dozen other funds, ContraFund is my largest
holding). And, at
this point, I would put the glider on order (if I were
in the market
for a new glider).

My recommendation is, if you have a glider on order,
hedge the FX rate, but if you think you can out-guess
the market, you're probably only half right.

9B

I don't out-guess the market; I find fund managers
who have a proven
track record of doing that. And I monitor there performance
to ensure
that they remain in the top 20-30% of their peers.

Tom
_________________________________________

Soooo, with a month to go on Tom's prediction how are
we doing?

Tom's advice:

Don't buy Euros in 11/05, instead buy ContraFund (versus
alternative funds, such as an S&P ETF or Euro-based
index) and wait.

Specific Euro prediction: weakening Euro from $1.20
in 11/05 to $1.10 or $1.05.

Actual performance:

Euro has strengthened from $1.20 to $1.25.

ContraFund: up 10.9% or 9.97% after management expenses
S&P 500 index: up 15.1%
DAX (German market) index: up 28.2%

So if you had taken $100,000 for a new glider (pick
your own number, but this one is nice and round) and
invested it in the ContraFund and taken it out yesterday
to buy Euros you would have 87,644 Euros or a 5% return
after adjusting for exchange rates.

If on the other had you had bought Euros a year ago
and put your money in a no-load DAX index you would
today have 107,017 Euros, or 23% more than under Tom's
strategy. In fact buying Euros and investing in a short-term
money market fund would have done better too.

Of course there is still a month to go so maybe the
ContraFund will make a big move, but over the past
12 months (and particularly the past 3 months the ContraFund
has significantly underperformend all the major market
indicies.

This was the point about chasing past returns - anyone
looking at the ContraFund performance up to last November
and deciding to invest with an expectation of above
market returns would have been disappointed.

Credit to Tom for putting his money where his mouth
was and making a prediction - many people don't have
the strength of their convictions. He just didn't turn
out to be right on either count up until now.

For reference:

http://finance.yahoo.com/charts#char...;range=1y;comp
are=^gspc+^dji;indicator=volume;charttype=line;cro sshair=on;logsca
le=on;source=

9B

Nice analysis, Andy.

I decided that the Euro would be unlikely to weaken sufficiently and
invested in a fairly new used sailplane last summer (just under Euro
85,000), which seems to have retained its value in the US market. I
guess that was almost equivalent to investing in Euros!

MIke

my recommendation on how to buy a glider affordably is this:
buy an old homebuilt ship with poor to decent performance.
spend the rest of your money on gas for retrieves and extra tows for
relights
enjoy staying up and going cross country when the lift is weak.

Tony wrote:
my recommendation on how to buy a glider affordably is this:
buy an old homebuilt ship with poor to decent performance.

Or...get a partner, then buy a low(er) cost motorglider like the Apis or
Silent, or a used Russia AC-5M, DG 400, PIK 20E.

spend the rest of your money on gas for retrieves and extra tows for
relights

Won't need the money for tows or retrieves, but you should put some away
for mechanical problems.

enjoy staying up and going cross country

Oh yeah!

when the lift is weak.

This part doesn't work out so well with the extra weight of the motor,
but you can still have a nice flight if you don't mind starting the
motor a time or two (I don't mind).

--
Eric Greenwell - Washington State, USA
Change "netto" to "net" to email me directly

"Transponders in Sailplanes" on the Soaring Safety Foundation website
www.soaringsafety.org/prevention/articles.html

"A Guide to Self-launching Sailplane Operation" at www.motorglider.org

ive never understood the logic of having a partner in a glider. seems
to me both partners are going to want to be flying on the same days.
maybe if you find someone with the cash to buy half a glider but not
the time to fly one then it would work out.

Hi Tony,

All the partnerships I've been in have been wonderful. The 3 of us never
flew as often as we wanted to so there were very, very few days when we 2 of
us wanted to fly. It was great to be able to share the cost of ownership
and expenses with 2 other people. It also made it much easier to afford
instrument upgrades and hangar fees, etc. I highly recommend partnerships
if you can find people you trust.

Good Soaring,

Paul Remde
Cumulus Soaring, Inc.
http://www.cumulus-soaring.com

"Tony" wrote in message
oups.com...
ive never understood the logic of having a partner in a glider. seems
to me both partners are going to want to be flying on the same days.
maybe if you find someone with the cash to buy half a glider but not
the time to fly one then it would work out.

Tony wrote:
ive never understood the logic of having a partner in a glider. seems
to me both partners are going to want to be flying on the same days.
maybe if you find someone with the cash to buy half a glider but not
the time to fly one then it would work out.

Maybe that's because most people fly less often than they think they will.

Jeremy

Tony wrote:
ive never understood the logic of having a partner in a glider. seems
to me both partners are going to want to be flying on the same days.

That's one of the challenges of finding a good partner. It's not as hard
as you might think, especially with a motorglider, because you aren't
constrained to flying only on weekends at the glider club, as you
usually are with a towed glider. If at least one of the partners can fly
during the week, both partners can have plenty of access to the glider.

You may also be able to base the glider close to where you live and/or
work, so it's easy go flying without a 2 or 3 hour drive to the
gliderport and rounding up a tow pilot in addition. And finally, you are
able to fly days you normally wouldn't use because the weather is
unpredictable, and you're worried you'll need a retrieve if you go cross
country.

maybe if you find someone with the cash to buy half a glider but not
the time to fly one then it would work out.

This is not an unusual partnership, in my observation! Some people do
enjoy being around gliders, tinkering with them, flying occasionally,
and hanging out with other glider pilots. Doing it at half price seems
like a bargain to them, even though those of us that fly many more hours
a year think it looks awfully expensive. Generally, I found pilots like
that are interesting people and a real asset to the sport, even though
they may only fly 5 or 10 times a year.

--
Eric Greenwell - Washington State, USA
Change "netto" to "net" to email me directly

"Transponders in Sailplanes" on the Soaring Safety Foundation website
www.soaringsafety.org/prevention/articles.html

"A Guide to Self-launching Sailplane Operation" at www.motorglider.org

"Tony" wrote in message
ups.com...
my recommendation on how to buy a glider affordably is this:
buy an old homebuilt ship with poor to decent performance.
spend the rest of your money on gas for retrieves and extra tows for
relights
enjoy staying up and going cross country when the lift is weak.


Tony,

Not all old homebuilts require "gas for retrieves and extra tows for
relights."
http://www.soaridaho.com/Schreder/Tr...ding_Post.html
http://www.soaridaho.com/Schreder

Wayne
HP-14 "6F"
http://www.soaridaho.com/Schreder/N990_Near_Arco.jpg

It's been a long and hard-fought battle, but the prize for wandering
off topic furthest and fastest in r.a.s. history can now be awarded!
Well done!

(And, since my office is next to the guy who invented the term
"efficient markets", I can't help but thank Andy for following up on
this one.)

John Cochrane