Good Sunday, I hope you are spending a great weekend and hopefully not surrounded by snow like some others around here… (sigh):) Ah well, with football and some great readings, I guess I won’t complain too much!

-US debt now equivalent to entire US economy, how to invest @ DarwinsMoney
-Best Canadian Dividend Stocks for 2012 @ TheDividendGuyBlog
-2012 looks like a good year for the markets @ HopeToProsper
-Public’s view of Capitalism @ AllFinancialMatters
- How a financial adviser could help you @ InvestWithPassion
-France and others downgraded @ ZeroHedge
-UK debt infographic @ BorrowingMoneyOnline
-ETF asset growth @ TheBigPicture

Tech Stock Readings

-12 stocks for 10 years @ The Curious Cat
-Murdoch admits he screwed up with MySpace @ TheNextWeb
-Why Samsung is the next Apple @ TechCrunch
-The Twitter-Google chess match @ ReformedBroker

Apple is a great company, perhaps the greatest of our generation thanks in large part to Steve Jobs. Say what you want about the guy, he led what is probably the most remarkable comeback in corporate history. The company is at the top of the tech sector in front of companies like Microsoft (MSFT) and Google (GOOG) and continues to grow even after Jobs’ departure. In fact, I have put myself out there saying that “you’d need to be crazy to not own Apple (AAPL) right now” given the valuation, the risk vs. reward, etc. There are very few things you could say against Apple, how they run things, etc.

One Recurring Critic

One theme that comes up over and over is the fact that despite growing mountains of cash, the company refuses to pay out dividends back to its shareholders, preferring to keep the money for possible acquisitions, etc. At this point, that stack of cash is becoming rather large, even for a company that could eye major acquisitions in the coming years…

So Back To The Subject…

Earlier this week, after markets had closed, Apple filed an SEC document where it had to disclose among other things executive compensation. Turns out that newly appointed CEO Tim Cook’s base salary was $900,000 in 2011. That seems low for a company that is making billions in profits.

That “Other Compensation”

However, Cook also received shares and options of Apple worth over $375 million dollars!!!! Sure, he can only sell half of those in 5 years and the other part in 10 years, but that is still an insane amount of money. If Apple’s stock does continue to increase, those will be worth even more. In fact, as of yesterday, the value is slightly higher than what he was given… in fact, his options are now worth over $420 million!!!

So Is Tim Cooke Worth $380M…?

I’m usually in favor of high compensation for executives, especially when it’s paid out in shares and options like this. Why? Because, believe me, Tim Cooke has a lot of incentives to keep things going well for Apple and for the stock price to increase many times what it currently stands at. Also, it’s easy to overstate this but it’s true. If Tim Cooke is able to deliver even 1-2% more in earnings than what others could have done because of his experience, knowledge, etc… then, it is probably a great move by Apple.

There Is An “If”

Honestly, was Apple’s board forced to give out this much. We all want Tim Cooke to have strong incentives, but wouldn’t $100M been enough? I’d love to know how they came up with such a huge number. Did Mr Cooke negotiate this for himself? If so, I’d love to get a few tricks from him…

Is Apple Rich Enough That It Can “Throw Money Away?”

If that is the case, now would be a great time to pay out a dividend to its shareholders…

Just sayin’

Disclosure: Long Apple (AAPL) but closing that position on today’s opening:)

After the end of the NFL regular season, I was surprised once again by the large number of firings by all kinds of teams. In some cases, like the Colts or Rams, it is understandable to some degree because things went so badly that inaction would have reflected very poorly on those teams. But what about teams like the Chicago Bears, that had an 8-8 season, missed the playoffs but did have great reasons. The fact that their two best offensive players got injured surely had something to do with their sudden slide in the rankings.

What about you? When your broker sends out information about your statements and that things have not been going well, do you consider a change? What about if they have great excuses to explain the poor performance? I mean could you really fire your broker for delivering a poor performance in 2008 when the market was absolutely crushed?

Do You Only Consider Change When Someone Offers You An Alternative?

Unfortunately, it seems like so many do not want to take the initiative of firing their broker. They will generally wait to be approached by someone else and once they get a good enough agreement, they’ll cross over and change. That sounds crazy. Do you think that coaches are only fired when another one offers his service to the GM?

It’s All About Expectations, Don’t Take Excuses

One of the more critical aspects of having a broker or financial adviser helping you manage your money is that there should be a very clear understanding as to how the money will be managed. Will there be a lot of risk (and thus volatility) involved? Or Not? Once you come to an agreement, you should know what type of profile your portfolio is supposed to have and thus how it should react more or less under different markets. The best example would be an investor that does not want risk and has 80% or so of his assets invested into bonds. If the stock market cripples, that should not give an excuse for terrible returns.

Communications Is Key

There is nothing wrong with telling your broker that you expected a different return. In fact, you should tell him because chances are that you do not have the same understanding of how the portfolio should react. Yes, there is a part of the returns that will be determined by which specific stocks or ETF’s are bought. But by far, the most important factor of your returns is the asset allocation which both of you should agree on.

Don’t Wait Until It’s Too Late

Any good broker should be more than happy to get questions about your returns. If you do not feel like such comments/questions are welcome, you have a good indication that you might not be working with the right guy. It’s important for you to voice your expectations rather than let yopur questions build up over time. If your broker has the right skills, he should be able to make the portfolio’s returns look more like what you’re expecting.

Do remember that with better expected returns also come more risk… there is no miracle recipe. Sure, there are some better brokers than others…

What You Should Expect From Your Broker Or Financial Adviser

-Regular communications regarding your portfolio, returns, etc
-Answers to your questions
-Returns that are comparable to what you would expect given your portfolio asset allocation
-Consistency of the returns over the year (there is nothing wrong with performing a bit less than expected for 1 year.. But over time time it should improve)

Have you ever fired your portfolio manager/broker and if so why?

Hi everyone, a few minutes to go before the start of the 2012 NFL Playoffs, the Colts are out but you better believe that I’m still very much ready to watch some great football:) Best of luck to all of you that do have your team still involved!:) If you do have some free time, you should consider taking a look at these links:)

-Today’s Top 50 Trending Stocks @ Ino (requires subscribing but it’s free)
-Dividend Growth Index Q1 @ TheDividendGuyBlog
-Noise, sentiment and StockTwits @ The Psy-Fi Blog
-Weekly chartology with focus on dividends and Goldman’s 2012 target @ ZeroHedge
-US adds 200,000 jobs.. looking better? @ CuriousCat
-5 New Year Resolutions That Are Good For Your Wallet @ BalanceJunkie
-All the world’s gold @ The Big Picture
-We are not in a dividend bubble @ DividendGrowthInvestor
-Comparing Canadian stock brokers @ MoneySmartBlog
-The Slow And Steady Passive Income Q4 Update @ Monevator
-The rise of consumption inequality @ AllFinancialMatters
-Do You Have What It Takes To Pass The CFA? @ SmartFinancialAnalyst

For most of you, today marks the start of a New Year. With that usually comes wishes and resolutions. I’ll start off by wishing you all to live your dreams, have quality time with your family and friends, and being healthy.

As for resolutions, I guess we each have some and I’m personally one who believes a lot in these. So far, I’ve usually been able to make most of them work to a good degree which probably helps me come back with more. In terms of investing, I’ve discussed some of my objectives and I will also obviously be putting efforts to save even more in 2012 than what I did last year. I think that while getting good returns is clearly more fun and exciting, the best way to add to our portfolios is just adding a bit more every month than we’ve done in the past.

I’m excited for 2012 to start and I hope you are too, Best Wishes And Thanks To All Of You Who Read, Write Comments and/or emails, I truly appreciate it and feel blessed to have these relationships with you,

Remember, life is short, live every day as if it were your last one,

Best wishes,

IS

Like everyone else reading this blog (or most of you at least), I am very much looking forward to starting 2012, especially to start my 2012 technology stock picks again. Don’t get me wrong, I love doing these picks, and I’ve certainly missed doing new picks in the past 3 months.. That being said, I’m nervous about doing the next ones. Why?

Putting It All On The Line Again

Many say that traders are only as good as their most recent returns. I don’t entirely agree but I do understand the idea behind it. Just think about it this way. The last time I opened a new trade, I knew that the difference between an amazing trade and a bad trade would likely be finishing 2011 with a return of over or under +50%. I think you’d all agree that while the return of 75% or so is incredible, being a bit lower would still have had a huge impact. I can’t imagine anyone thinking much less of me simply because the 2011 would have been “only” 50%.

Back To Square One

That being said, in a few days, I’ll be right back on the start with a 0% return in 2012. That means a few bad trades to start off the year would have a huge impact on the return obviously. Things might start off well as they have in both 2010 and 2011 but they could always turn out bad as well. Let’s face it, even with these great returns, I’ve made almost as many bad trades as good ones. The chances of starting with 2-3 losing ones is not that small.

What Happens If I Start Off The Bad Track

The big question of course is how it might (or not) affect me if I made 3-4 bad trades to start off the year. How much would I question myself and would it affect how I would do my trades? I would like to think that 3-4 trades would not be enough to shake my confidence but that is probably underestimating the emotional aspect of trading. That is also why no matter how things go, I will probably discuss the psychology of trading a lot more in 2012. Hopefully I won’t become a case study of how things can go wrong:)

Not Much I Can Do At This Point

I will likely open 2 or 3 new trades next week and at least one more the following week. That should help “diversify” my risk. If you are interested in these long and short tech stock picks, please be sure to join our free newsletter about technology long and short trading here:

That being said, I hope you will have a wonderful weekend, ,

IS