How to buy a glider affordably - redux

Hi John - How are you ? How come you weren't at the Hinckley
end-of season cook-out this evening ? I bet we can move this
thread to women and soaring if we keep at it...
See ya, Dave

PS: and of course you know about our Fair Value product...

BB wrote:
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

BB wrote:
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!

Now just a moment here! The subject is "How to buy a glider affordably -
redux", and that's what we've been talking about. Maybe it should of
been "How to make enough money to buy a glider that isn't affordable",
but it wasn't. Frankly, it's the Original Poster who was off topic! Or
is that what you meant? Going off topic in one posting? You know, that
is exceptional...

--
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

yea no kidding, the original post had nothing to do with gliders. he
was trying to work some stock or money market system or something.
most of those schreders are going for 3-4 times what i payed for my
cherokee with an enclosed trailer. just remember, if youve got enough
glider to make it back to the airport, you probably could have gone at
least a third longer distance if you wouldve just kept going downwind!

i bought my glider to avoid having to share gliders with people (a'la
club) call me selfish but i like having my own ship to go cross
country when and where i want. Ill keep a partner in bed and that is
all.

yea no kidding, the original post had nothing to do with gliders. he
was trying to work some stock or money market system or something.
most of those schreders are going for 3-4 times what i payed for my
cherokee with an enclosed trailer. just remember, if youve got enough
glider to make it back to the airport, you probably could have gone at
least a third longer distance if you wouldve just kept going downwind!

i bought my glider to avoid having to share gliders with people (a'la
club) call me selfish but i like having my own ship to go cross
country when and where i want. Ill keep a partner in bed and that is
all.

In this part of the world most gliders (UK) are syndicated
(partnerships). In fact several people at our club
are in multiple syndicates. For example one person
has shares in a Bocian, K13 and a primary. Another
has a 1/10th of a Nimbus 3dt and 1/2 an asw20. Keeps
the cost down and the utilisation up.

If you find a partner with a different lifestyle it
helps. for example a 9-5 person and someone who works
shifts such as an airline pilot or retired.

Incidentally I was sat at a table outside our club
drinking tea today and noticed I was in company with
a junior world champion, 18m world champion, ex club
class world champion, the chairman of the BGA and two
ex british team members. How cool is that!
Nigel
Nigel

On Oct 29, 12:00 pm, Nigel Pocock
wrote:
In this part of the world most gliders (UK) are syndicated
(partnerships). In fact several people at our club
are in multiple syndicates. For example one person
has shares in a Bocian, K13 and a primary. Another
has a 1/10th of a Nimbus 3dt and 1/2 an asw20. Keeps
the cost down and the utilisation up.

If you find a partner with a different lifestyle it
helps. for example a 9-5 person and someone who works
shifts such as an airline pilot or retired.

Incidentally I was sat at a table outside our club
drinking tea today and noticed I was in company with
a junior world champion, 18m world champion, ex club
class world champion, the chairman of the BGA and two
ex british team members. How cool is that!
Nigel
Nigel

So cool you all have to sit around drinking tea instead of flying?

Mike



Incidentally I was sat at a table outside our club
drinking tea today and noticed I was in company with
a junior world champion, 18m world champion, ex club
class world champion, the chairman of the BGA and two
ex british team members. How cool is that!
Nigel
Nigel

At 08:18 29 October 2006, Tony wrote:
yea no kidding, the original post had nothing to do
with gliders. he
was trying to work some stock or money market system
or something.
most of those schreders are going for 3-4 times what
i payed for my
cherokee with an enclosed trailer. just remember,
if youve got enough
glider to make it back to the airport, you probably
could have gone at
least a third longer distance if you wouldve just kept
going downwind!

i bought my glider to avoid having to share gliders
with people (a'la
club) call me selfish but i like having my own ship
to go cross
country when and where i want. Ill keep a partner
in bed and that is
all.


You guys need to read more than the subject line...

My post referred back to a post a year ago where someone
asked if he had a new glider on order with a delivery
a year out what was the best thing to do with his money.

It ended up in a bet between a few of us and Tom Seim
who made a prediction about the performance of the
Fidelity ContraFund versus the broad market and Euro/$
exchange rates. His suggestion was to keep you money
in dollars and invest in the ContraFund. Turned out
to be bad advice. My post was to close the loop on
that bet.

BB is right - it went way off topic in the 2nd reply
and never came back. Unless you consider spouting about
anything vaguely related to the subject line as 'on
topic'. How it morphed into Cherokees and patnerships
and motorgliders is a testament to short attention
spans.

9B

At 08:18 29 October 2006, Tony wrote:
yea no kidding, the original post had nothing to do
with gliders. he
was trying to work some stock or money market system
or something.
most of those schreders are going for 3-4 times what
i payed for my
cherokee with an enclosed trailer. just remember,
if youve got enough
glider to make it back to the airport, you probably
could have gone at
least a third longer distance if you wouldve just kept
going downwind!

i bought my glider to avoid having to share gliders
with people (a'la
club) call me selfish but i like having my own ship
to go cross
country when and where i want. Ill keep a partner
in bed and that is
all.


You guys need to read more than the subject line...

My post referred back to a post a year ago where someone
asked if he had a new glider on order with a delivery
a year out what was the best thing to do with his money.

It ended up in a bet between a few of us and Tom Seim
who made a prediction about the performance of the
Fidelity ContraFund versus the broad market and Euro/$
exchange rates. His suggestion was to keep you money
in dollars and invest in the ContraFund. Turned out
to be bad advice. My post was to close the loop on
that bet.

BB is right - it went way off topic in the 2nd reply
and never came back. Unless you consider spouting about
anything vaguely related to the subject line as 'on
topic'. How it morphed into Cherokees and patnerships
and motorgliders is a testament to short attention
spans.

9B

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.

What can I say, I was wrong on where the Euro would end up. I also said
you can go broke trying predict currency exchange rates. My stated
philosophy is to wait until the real invested returns allow you to buy
the glider at what you consider to be an affordable price. Exchange
rates WILL cycle; being patient is what it is all about.


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

The S&P 500 did outperform ContraFund over the last year, but FCNTX
handily beat it over a (longer) 3 year period. I realize that a lot of
you regard 1 year as long term, but it isn't.

I said it before, but I guess it just hasn't sunk in: I don't "chase"
returns, I find money managers that are in the top quintile (that is
the top 20%) of their peer group over a long period of time. Relative
performance can vary pretty dramatically over a short period of time.
The S&P 500 has outperformed FCNTX for just the last 6 months.




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.


You are, indeed, extraordinally skillful at predicting the past! Again,
short term time horizons amplify differences in investment strategies,
but give us little insight as to what the future will bring.

Personally, I recommend a minimum of 5 high-grade mutual funds for an
adequately diversified portfolio. And this should include international
exposure, which has outperformed U.S. concentrated mutual funds such as
ContraFund (FCNTX). It is a moot point now because FCNTX is closed to
new investors. For a strategy that relies on mutual fund upgrading
(keeping your portfolio in the top quartile or quintile) go to
http://www.fundx.com. They are now recommending a number of ETFs
(exchange traded funds) such as PWV, EZU FEV and IEV. In practice, I
rebalance my portfolio 3-4 times per year. This process led me to
reduce my holdings in FCNTX, which now represents about 3% of my
holdings. My largest holding is AEPGX (American Funds EuroPacific -
notice the "Euro"), which returned 20% in the last year, followed by
Fidelity Diversified International, which returned 17%. I also own one
fund , Fidelity Latin America (FLATX), that returned 45%, but this is
definitely not one for the faint of heart!

My recommendation regarding FCNTX was based on its outstanding
performance over the long haul (10 years), and that, given the
attention span of the typical glider pilot, I had to limit it to a
single pick. I still believe that 10 years from now it will be a good
choice.

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.


The principal of compound rate of return will make me right at some
point in the future. FCNTX's historical return of over 11% means it
will double, by the rule of 77s, in 7 years. And FCNTX is STILL in the
top quintile of its peers, which is why I still own it. But you have to
manage your portfolio; if any funds fall out of the top quantile dump
them and replace it with one that is (and has been over a significant
time period).

BTW: my portfolio returned over 17% in the last year.

Tom