|
|
|
June 25th, 2006
03:03 pm - Random Thoughts
Every 2 years, I assess myself and plan for the next 5 years. I believe that you cannot follow every objective that you have planned originally since everything changes instantaneously. My work experiences are the following: Finance/Accounting Internship at Publishers Clearing House for 1 month (150 hours), Accounting Clerk at First American Title Insurance Company for about 6 months, Professional Associate aka Management Accountant at American International Group (AIG) for 1.5 years. For my current position, I will be starting as a Financial Analyst at Lehman Brothers on June 26th. For this particular position, this is about 70% Finance and 30% Accounting, which is the main reason why I accepted this offer. For example, if there is a new contract for about $2 million worth, how would this impact the P&L and how can you make it so that the particular group is not over budget by a substantial amount? If you look solely through a financial perspective, analysts and management would only see that the group is over budget by a substantial amount. However through an accounting perspective, accountants understand that you can amortize the total amount once services have been rendered, not through a cash basis. The amortized amount would be based on the expiration of the contract. How would this work? Hang it onto the Balance Sheet and amortize it on a monthly basis. How do I know this? It's GAAP. As for the Financial Accounting Standard (SFAS), this is pure acquired knowledge. Do your research.
Imagine what employers would think of my work experience background when they first see my resume. "This guy only had one out of three positions over 1 year's worth of experience. Based on past performance, he only has 33% of staying with an employer for over a year." Ironically, this may be what employers think, but they were more involved with the duties that I have entailed. The only question that they asked me related to short duration was my stay at First American Title Insurance, and the reason was that it was a temp position and that they did not have a full time position at the moment. Technically, employers don't like to see much volatility and look for employees who seek longevity, but with valid reasons, it would no longer be a concern. Bottom-line, they are more interested on whether you are advancing yourself within your work experiences rather than the duration.
Another random thought. I have seen many 401K financial calculators, but none of them suit my needs. Most of them are forecasted earnings based on your current contributions, length of time, and % earned. This is great, but these are not my concerns. What I would like to know are: How much can I save in taxes based on my contributions for the year? How about how much % I would need to contribute in order for myself to maximize the contributions and the company match? And so, based upon my knowledge and understanding of the tax system, I have created two financial calculators in Excel that would answer these questions. I'm still tweaking one of the financial calculators for sentivity analysis, but I plan to finish this soon. Since there is no option to upload a file(s), you can send me a message stating that you would like to receive a copy from me free of charge. Or if you're nice, treating me to lunch would be nice.
|
June 19th, 2006
11:25 pm - Updates
I currently have no friends added in Live Journal, but a zillion on my AIM buddylist, while half of them whom I haven't spoken to for the longest. Is this not a good online journal to use? Don't tell me you think Xanga or Facebook is the best. This is nice and simple to use. All of the others look cluttered.
Before I even update everyone regarding my adventures and insights, I would like to know who accually reads my online entries. Please IM me, e-mail me, or leave a comment. If there are a sufficient amount of people, then I will continue updating everyone. If there aren't enough people, then I will make my online entries private. Even better, let me know if you have a Live Journal account and I'll make the entries visible to friends only.
|
October 13th, 2005
08:49 pm - Analyzing Bernstein's Investment Advice
Bernstein's argument for slice and dice (not necessarily his choice of funds) is clear and commonsensical, and doesn't resort to claiming the Total Market Index is "overweighted" in big caps—it is market cap weighted, which means you own the same proportion of all companies, whereas slice and dice leads you to owning considerably higher portions of small companies than big ones).
A Total Stock Market Index Fund rebalances daily, which allows it to achieve average market returns (minus a small expense) with little in the way of capital gains taxes from rebalancing.
Bernstein argues that, since there tends to be a cycling of momentum through different market segments, if instead of rebalancing daily, you equally weight segments and rebalance periodically; you will get a rebalancing bonus (i.e., taking profits). In taxable accounts, this leads to capital gains taxes, and the question has always been whether the rebalancing bonus is enough to warrant the taxes, which is why trying slice and dice in retirement accounts is preferable. (My problem has been with pulling this off in retirement accounts, where I have limited options and where I want to prioritize fixed income assets, given their tremendous tax disadvantage in taxable accounts). At any rate, the logic behind Bernstein's argument suggests using market segments that track divergently (traditionally, stocks versus bonds was considered sufficient). Use of overlapping funds will limit the divergent tracking from which the rebalancing bonus comes. Of course, trying to avoid taking profits, which generates taxes in taxable accounts, reduces the rebalancing bonus to where you put new money, and if you are dripping new money in every month, what you are doing looks a lot more like the daily rebalancing on an index fund that the periodic rebalancing to catch momentum swings advocated by Bernstein.
Historically, bond funds (specifically long bonds) have provided the best counterpoint to stocks. This is not likely to be the case in the near future, because interest rates remain low. Interest rates would have to go significantly lower for a bond fund to provide a capital gain to balance capital losses from a down stock market. So, at this point it makes more sense to keep your bond/fixed income allocation into something that will get you the best income return (e.g., CDs) instead of hoping for a rebalancing bonus.
|
September 26th, 2005
11:10 pm - Management Accountant
To keep this brief, here's an introduction as to what some of my job duties are. I work directly under a supervisor, but now I'm working quite closely with the Director. For these few months, I will be working on annual statements, in addition to my daily workload. For my daily/monthly routines, there are about 15 intercompany accounts that I monitor, in addition to about 10 monthly entries. According to the department, I am the Subject Matter Expert for 1 profit center and about 2 legal entities. Also work on the monly General Operating Expense report and I supervise about 2 other members in my team. Worked on cost statements for about a month until things started to get more hectic. Not too bad and only been employed for about half a year.
Although we have a fresh management team, our department is being carefully supervised under the SEC and SOX. I chose AIG not mainly because of the company's exceptional performance, but because I would like to be a part of the team to "heal" the company from their past mistakes. A few years from now when being interviewed by top firms, I expect to tell the employers that I was a part of the team that made my previous company more efficient, and can handle many projects and meet deadlines that I would be challenged. Let me pursue my CPA license first before I speak further.
|
July 25th, 2005
10:09 pm - A Random Walk Down Wall Street Book Review
This is a book review that I wrote for my Financial Management class. The professor gave me one of the highest grades for the paper. Decided to share this all with you.
“A Random Walk Down Wall Street”
A Random Walk Down Wall Street by Burton G. Malkiel is one of the classic books about investment. While Malkiel believes that the stock markets are efficient, he also points out that from time to time, excitement or utter despair takes hold of the markets. The old joke about the efficient-market professor has him walking down the street with one of his students. The professor tells the student not to pick up the $10 bill because if it was really there, somebody would have picked it up already. However, Malkiel advises us to pick up the $10 bill quickly because if we don’t, somebody else will and the opportunity will vanish. A recurring theme of this book is that any investment theory that becomes too popular will probably fail to work in the future. For example, the Dogs of the Dow strategy involved buying ten of the thirty DJIA stocks with the highest dividend yields. The theory was that these stocks were out of favor and thus represented value. However, Malkiel tells us that mid 90’s, this strategy performed very badly. He says that by mid-90’s, more than $20 billion had poured into mutual funds whose goal was to buy the Dogs of the Dow. Therefore, all the buying drove out the value to be offered and Malkiel writes that the Dogs of the Dow no longer hunt.
A Random Walk Down Wall Street includes an excellent life cycle guide to investing with advice about how to divide your portfolio between stocks, bonds, REITs, and other asset classes. By using index funds, an investor can put together a widely diversified portfolio. Today, there are an abundance of index funds including: Vanguard Total Stock Market, REIT Index Fund, European Index Fund, Pacific Index Fund, Emerging Markets Index Fund, Large/Mid/Small Cap Index Fund, etc. Vanguard has one of the lowest expenses in the mutual fund industry, averaging roughly .2 percent.
Index funds are my favorite type of investment in the stock market. In terms of the total US stock market, you may invest in the S&P 500. If you are going to buy more S&P 500 when it becomes expensive, and less when it becomes less expensive, you would be better off holding the S&P 500 and dollar cost averaging into the prices. This way, you would get a better price for the assets as you wouldn’t be buying small caps, for instance, when they become more expensive over large caps, at a higher risk for a higher expected return.
|
April 21st, 2005
10:12 pm
| You scored as Existentialism. Your life is guided by the concept of Existentialism: You choose the meaning and purpose of your life.
“Man is condemned to be free; because once thrown into the world, he is responsible for everything he does.”
“It is up to you to give [life] a meaning.”
--Jean-Paul Sartre
“It is man's natural sickness to believe that he possesses the Truth.”
--Blaise Pascal
More info at Arocoun's Wikipedia User Page...
Utilitarianism | | 90% | Hedonism | | 90% | Existentialism | | 90% | Strong Egoism | | 85% | Kantianism | | 75% | Justice (Fairness) | | 65% | Nihilism | | 60% | Apathy | | 20% | Divine Command | | 20% | </td>
What philosophy do you follow? (v1.03)
created with QuizFarm.com |
|
April 9th, 2005
09:38 pm - Secrets of the Millionaire Mind
From the book by T. Harv Eker:
1. Rich people believe "I create my life." Poor people
believe, "Life happens to me."
2. Rich people play the money game to win. Poor people
play the money game to not lose.
3. Rich people are committed to being rich. Poor people
want to be rich.
4. Rich people think big. Poor people think small.
5. Rich people focus on opportunities. Poor people focus
on obstacles.
6. Rich people admire other rich and successful people.
Poor people resent rich and successful people.
7. Rich people associate with positive, successful
people. Poor people associate with negative or
unsuccessful people.
8. Rich people are willing to promote themselves and their
value. Poor people think negatively about selling and
promotion.
9. Rich people are bigger than their problems. Poor
people are smaller than their problems.
10. Rich people are excellent receivers. Poor people are
poor receivers.
11. Rich people choose to get paid based on results. Poor
people choose to get paid based on time.
12. Rich people think "both." Poor people
think "either/or."
13. Rich people focus on their net worth. Poor people
focus on their working income.
14. Rich people manage their money well. Poor people
mismanage their money well.
15. Rich people have their money work hard for them. Poor
people work hard for their money.
16. Rich people act in spite of fear. Poor people let fear
stop them.
17. Rich people constantly learn and grow. Poor people
think they already know.
|
April 1st, 2005
07:21 pm - Job-related.
My previous job.
In my previous post, I mentioned that I was working for First American Title Insurance. Although I was working there as a full-time temp, it was a nice experience, but there was no growth. In the accounting department, I was looking forward to work more on journal entries, bank reconciliations, balance sheets, etc., but that didn't happen. According to the Controller, the one who offered me the position, didn't want the temps to have so much responsibility. One of the coworkers that I was working with, namely Homer, was the only one who understood that I was thriving to learn. He showed me many things, without the Controller knowing. He didn't get into trouble of course since we were just that sneaky. To make a long story short, after finished paying off my college loans, and realized that there was no growth within the company, I started to look elsewhere and applied to only one specific position: Professional Associate (aka entry-level management accountant aka junior accountant). Yes, many titles for one position.
Find yourself first before you search for a job
Before you decide to walk into a dark room without a flashlight, prepare yourself first before you start your journey. It's hard and strenuous, but not impossible. I'll start with the basics. Before you even decide to apply for jobs, understand what position(s) you will be applying for. Without focus, you're throwing yourself into the fire and you will get burned. There are numerous amount of available positions and it will be much simpler if you aim for your target. However, if you don't have any positions in mind, don't be discouraged. Take a couple of personality and career assessment tests that may further assist you with your career path. If you don't think that's necessary, that's fine also. Ask yourself some relevant questions and you're getting nearer to the bullseye. Simple question: Are you a numbers person or a people person? If you can answer that, you're half way there. What's more important to you, money or happiness? If you're familiar with this concept, some say that money brings happiness, but let's not lead this into a debate. You can work in a position with a salary over $60K and not be content with your job duties, or work for a position that pays $30K, but really enjoy what you do and you're comfortable with the environment. It's just like being in a relationship. Know what you'll be getting yourself into.
|
September 12th, 2004
12:36 pm - Recent Updates and Future Endeavors
This is my first entry. Originally, I've started out using Xanga, but most of the entries that I read can be quite tedious. Do you actually think people are interested in what kind of crap you've eaten for the day or how bad your professors really are? Well, maybe some people are interested in reading those type of entries, but I'm not. Some Xanganians are so irritating that they repeatedly ask for Eprops and what not. Who cares?! Anyway, the layout on Live Journal is much easier on the eye. Nice and simple and easy to use. Hence, no more Xanga for me.
As for what I've been up to since graduation, I'm currently working. It was not easy at all to get a job within my field. After facing much pressure from my dad mainly about why I still haven't found a job yet after obtaining my college degree, I have come to the realization that he is only doing his job as a parent. It is his way of showing his support, even though it isn't the best way to approach it. Countless hours were spent on thinking about my future endeavors and the type of entry-level positions that best suit me. Most of the interviews that I have faced, numerous applicants have already obtained their MBA's with stellar GPA's. I might not have received the offer, but it was truly a great interviewing experience for me. Try to answer numerous formulas and ratios in great detail based on their purpose with a limited time. Yeah, not fun. There were also countless of times where I was accepted to an offer and the salary looked quite rosy, but it wasn't what I was looking for. It wasn't within my boundaries. It was an opportunity, but there was also a chance where being pigeon-holed may occur. No thank you.
I am currently a full-time working at First American Financial as an Accounting Department Assistant. My hours are Monday-Friday, 8:00AM-5:00PM. I am paid on an hourly basis and overtime hours if necessary. After months of deciding which license or degree I wish to pursue further (MBA, CPA, CFA, or CFP), I chose to pursue the CPA, Certified Public Accountant. Being that I have majored in Economics with minors in Business Management and Statistics, I would like to take a few Accounting classes as non-matriculated to obtain a foundation of accounting knowledge before I take the exam. In addition, I am determined to study for countless hours and to better prepare myself. For those of you who do not know how hard this exam is, let's just say, having sufficient knowledge is not enough. Knowing how to prepare for this exam in addition to your review classes, and most importantly your attitude, are all integral parts to passing this exam. Statistics show that about 20% of the first timers pass. Over 100,000 applicants apply, but only a small percentage makes it. I am currently reading books on how to prepare myself better before I start to take night/weekend classes. I have to decide soon about what I should do about my job. Should I continue to work and study at the same time, or should I take a few months solely on studying and preparing? More shall be stated on the next entry.
|
|
|
![[info]](http://l-stat.livejournal.com/img/userinfo.gif){kind=small}
ewong82's journal