Stock Market and Real Estate Return: A Comparison

Hi everyone,

I’ve invested in the stock market (mainly Bay Area tech companies and a couple Chinese ones) and also real estate around the Bay Area (SJ, East Bay). Here’s a comparison of the returns I got for 2016:

S&P 500: 9.5% gain
NASDAQ: 7.5% gain
My Stocks: 7.3% gain
My Real Estate: 7.9% gain
My Net Worth: 16.1% gain

Happy investing!



wuqijun, welcome back and be active in the blog.

I had good returns last year from stocks, but did not see gain percentage, esp on real estate. On any case, It is somewhere between 6.4% and 8.1% overall.

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Excellent growth in networth. But I bet you have a low leverage. If your RE is leveraged by 1:3, your networth can grow at over 20%. If leverage is 1:4, you can grow at 32%

Most of the time, active stock investment is a waste of time

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Very funny… implies you use leverage… shouldn’t RE appreciation include leverage?

AAPL screwed up so my net worth is unchanged for the year despite good gains in RE and index fund.

So far, this year is looking good.

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After the 100 fold appreciation in aapl, do you still hold to avoid paying taxes? I would sell now

Why? Dividends are more than my last draw pay and my initial capital. I’m waiting for Trump to reply to your letter proposing no capital gain tax.

Hardware business is hard to sustain success. It could be a bumpy ride. But of course it’s now super hard for you to lose money on Apple based on your original cost

Hi Bagb,

My leverage is actually infinite ratio for my investment properties because I used borrowed money to fund all purchases… I never paid a penny out of pocket for them. But then the percentage gain was calculated against the overall appreciation of the value of these properties and not how much out of pocket money I put in to acquire them.

Hi hanera,

The RE appreciation figure is based on how much these properties rose in value in 2016. I’m not sure how I can include leverage in that figure.

Yes, don’t sell AAPL. Dividends are yummy.

Ai yo yo. Simple computation.

Net gain of RE in % = 100 x (Price on Dec 31 2016 - Price on Jan 1 2016 + rent collected for 2016 - mortgage principal repayment for 2016- mortgage interest for 2016 - all expenses in 2016) / Price as computed like above for 2015

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He didn’t realize Tim Cook is a nice man, he raises dividends by 10-15% per year which is much higher than inflation rate or pay rise… who get his/ her pay increases by 10-15% per year?

My stock portfolio averaged about 12% in 2016 not including dividends. Too bad I didn’t put more money in this last year. Oh well there’s always next time :slight_smile:


What’s the yield for aapl? It shows 1.77%, is it right?

That is yield. I’m referring to dividends 57 cents for this quarter i.e. $2.28 per year, previously is $2.06.

I do not get why the excitement over 1.7% dividend. It seems that you guys are still banking on more capital gains. If the stock price is flat, 1.7% would be disappointing.

Ignore the share price and the yield… Last year my dividend pay day is $2.06 per share, this year is $2.28 per year, appreciates by more than 10%. In other words, if my gross dividend last year is $50k, this year I would get $55k!!!

Stock market got you confused… assume can’t be traded. From another perspective, I am talking about income not asset valuation. Value of asset fluctuate in the stock market but income keeps increasing. Yield is only relevant at the point of purchase and during re-balancing (financial advisor loves to advise investors to re-balance at least once a year).

AAPL EPS is $8.31, cash per share is $11.56, dividend per share is $2.18.

If it earns $8.31 per year and only pays our $2.18, it’s cash generation per year should be $6.13. Where does the cash go? Maybe you can ask Tim to increase dividend to 100% earnings since there is plenty of cash as a reserve, and they have money overseas.

But our focus should be finding the next AAPL which has a 100 fold potential. Where is it?

Just FYI, earnings do not equal cash.

Good point. Please share with me when you find it. I was thinking of LQMT… have tons of it… more than double… no big deal… we are talking 100 folds… so need to look for small cap… private equity, me don’t know, if you know, please educate me.

Obviously, all the current hot stocks (FB, GOOGL, NFLX, TSLA, AMZN) are not good. Can’t give 100 folds. Miss NVDA :frowning: