Let's talk about investments

[nala]

@nala
At the moment I have to work for a living in a stressful job. I would like to be able to retire early (very early) so I can relax, spend time caring for my family, and enjoy the simple pleasures of life.

Investing my money wisely to protect it against inflation and produce an income that will cover my simple living expenses, coupled with my pension, is the only route to doing this. Many, many people are in the same situation.

It's nothing to do with greed.

You don’t have to explain yourself to me. I asked a simple question. Some people on this thread got into a heated debate about their abilities to invest—that’s kind of what I was referring to. Anyhow, no one ever wants to admit to greed and I doubt anyone on this thread will. Instead I’ll keep getting explanations and altruistic reasons and blah blah bc greed is not an attractive quality. I hope people stop responding to my question bc it’s getting quite embarrassing.

 

[Austina]

Does being compensated for the work you do and ensuring that you hang on to, and maximize that money, make you greedy? I don't think so. I imagine everyone wants to live as well as they can, take care of themselves and their families. For us, not being financially reliant on anyone else is important, as is helping our son and any future family. I thought that's what most people want.

 

[LilAlex]

Anyhow, no one ever wants to admit to greed and I doubt anyone on this thread will. Instead I’ll keep getting explanations and altruistic reasons and blah blah bc greed is not an attractive quality.

Not sure why you keep doubling down on this. Now you make it sound like "greed" is anything that people do to try to maximize their investment returns. To me it's the same as avoiding the expensive downtown gas stations -- why would I not do the easy and obvious things that allow me to passively keep more of my own money or allow it to grow as fast as possible? I don't do loan-sharking or pyramid schemes -- my crime of "greed," as you would call it, is just paying attention to how I am investing my (mostly) hard-earned cash.

Folks are reluctant to walk away from this part of the conversation, as you advise, because it's a little offensive to be called out for trying to invest sensibly. Yes, none of us know when it's "enough" and I will not call Vanguard or Fidelity or Schwab and say "Roll it all to cash!" when I hit a magic number. I will retire some day but I doubt I will pull all my money out of investments. We may have forgotten about inflation for a decade but this year has been a good reminder; a subsequent ten years of 7% inflation (and, to be clear, I do not expect that) would halve the purchasing power of our nest egg.

And yes, as others have said, we may never feel we have "enough." We still have a set of fit and active but aging parents who were underprepared for retirement, a special-needs relative who will require a half-century of expensive supervised care (we are not in the mix but you never know), nieces and nephews who are academically but not financially prepared for college, etc. Add to that the prospect that emerging targeted therapies for cancer may be a quarter- or half-million dollars and no one has clarified who will pay for those. There is a lot of uncertainty in our future needs and spending. I am anxious and I am a "planner" (for this, but not so much for Valentine's Day; see other thread ). So we aim to be overprepared (and not rely on our kids) rather than underprepared. Maybe some people consider that "greed." I would not have expected that.

 

[nala]

Not sure why you keep doubling down on this. Now you make it sound like "greed" is anything that people do to try to maximize their investment returns. To me it's the same as avoiding the expensive downtown gas stations -- why would I not do the easy and obvious things that allow me to passively keep more of my own money or allow it to grow as fast as possible? I don't do loan-sharking or pyramid schemes -- my crime of "greed," as you would call it, is just paying attention to how I am investing my (mostly) hard-earned cash.

Folks are reluctant to walk away from this part of the conversation, as you advise, because it's a little offensive to be called out for trying to invest sensibly. Yes, none of us know when it's "enough" and I will not call Vanguard or Fidelity or Schwab and say "Roll it all to cash!" when I hit a magic number. I will retire some day but I doubt I will pull all my money out of investments. We may have forgotten about inflation for a decade but this year has been a good reminder; a subsequent ten years of 7% inflation (and, to be clear, I do not expect that) would halve the purchasing power of our nest egg.

And yes, as others have said, we may never feel we have "enough." We still have a set of fit and active but aging parents who were underprepared for retirement, a special-needs relative who will require a half-century of expensive supervised care (we are not in the mix but you never know), nieces and nephews who are academically but not financially prepared for college, etc. Add to that the prospect that emerging targeted therapies for cancer may be a quarter- or half-million dollars and no one has clarified who will pay for those. There is a lot of uncertainty in our future needs and spending. I am anxious and I am a "planner" (for this, but not so much for Valentine's Day; see other thread ). So we aim to be overprepared (and not rely on our kids) rather than underprepared. Maybe some people consider that "greed." I would not have expected that.

Ok. This is my last response to this thread. I didn’t know a word could trigger so many. Just look up the definition of greed and remove all connotations from it and you will see why according to you, I am “doubling-down.” It’s just a word. Separate emotions from it and you have a solid definition that characterizes the discussion here. Don’t worry. I’ll see myself out of this—tho I don’t care to take responsibility for people being reluctant to post. Clearly no one here had inhibitions about posting prior to my one question. Lol. Don’t take me to seriously. I’ll leave you all to your business!

 

[smitcompton]

Hi,

You ought to take responsibility for what you said. You knew the negative connotations associated with that word and you used it anyway.
In another thread people stated why they didn't like or want or need to discuss money-not particularly on this thread.

Since I also want to end your reign and control of these posts, I will admit.
GREED IS GOOD. Michael Douglas said so. I believe him.
Annette

 

[LilAlex]

Hold on. So the person who just posted this photo is accusing me of "greed"?

We have nothing like this in our jewelry arsenal...






I think you are using that word as "code" for something else. Maybe "globalists."

 

[Phoenix]

Hi, \
. MrBXXX--- Is it that you are unhappy with your returns in your portfolio? I ask the question because it does concern me that you think you ought to be making the 50% or 100% return as some stocks have done? Or do you think your style of investing would be better served by having professional management? I have a hard time selling any stock and must force myself to do so. So if you think someone else can do better, it would be a wise move.

This market is not like the dot com era. As you suggested fundamentals do count and sometimes a stock does become a momentum stock while still possessing good fundamentals.

It seems to me that Lil Alex doesn't know much about Nvidia, AMD, and what is happening in the chip world. She only sees 50%, 100% gains, and jumps to a erroneous conclusion, and wants to shut down the thread. Nvidia, is considered the best of breed and an excellent company to own.(one of the best) New technology needs new types of chips and these companies can provide what is needed. There are many other good ones. We will see prices on the stocks fall when interest rates begin to rise.

Phoenix-- Here is another blockage I have-- No matter what the price earnings ratio is and someone calls it cheap, if its 700.00 a share, to my mind it is not cheap. Amazon at 2300 per share is not cheap, although I understand why they say this. So I'm stuck. Lower cost stocks are where I do most of my buying. Ha, ha

Whitewave- A 17 % return on investment is great. Normally its about 8%.

More tidbits-- Apple (you know that speculative stock) has doubled 5 times in the last five years. Could be the fundamental were good,

I'm reading this thread again, as a few friends have asked me to help with their investments. So interesting to see what the market has performed since this thread, plummeted to scary lows only to rise again to historical highs. NVDA is an absolute darling (so glad I'm long on that stock). AMD is not doing as well...

Haha, since this thread, AMZN, TSLA, GOOG etc have split, making them more "affordable"!

 

[smitcompton]

Hi,

I'm so glad I saw this thread. I wrote a note to you on my other thread. Yes, we had a crash. Nvidia is flying. AMD is OK. I love the CEO. I'm sticking with it.
I got hurt when the regional banks failed. , I am overweight banks, so I'm still down, alot. But I tell myself I am still ahead from the good years. The trouble is I can't forget how much more I was up. Once they credit my account it mine.

Lets see if LilAlex comes to criticize us again. I made friends with Him, so he will be gentler, I think. He's quite nice. He did give us the business tho.

Hope to see you again.

Annette

 

[musicloveranthony]

I manage my own and I'm up 20.5% year to date. I don't really worry too much about short term results, though. I care most about my long term financial goals.
Investing is one of my hyper-fixations - along with gemstones and diamonds. So, I'm super passionate about it and spend hours a day researching

 

[musicloveranthony]

I manage my own and I'm up 20.5% year to date. I don't really worry too much about short term results, though. I care most about my long term financial goals.
Investing is one of my hyper-fixations - along with gemstones and diamonds. So, I'm super passionate about it and spend hours a day researching

My goals being retiring at 52, being able to pay for my niece to go to school if she chooses, and being able to ensure my parents have the care they need as they debilitate

 

[LilAlex]

Lets see if LilAlex comes to criticize us again.

No worries -- you're all safe. I did not mean to kill the discussion. I may have saved some folks a few dollars. What you all do with your 10% "mad money" is none of my business!

My biggest pet peeve is high-fee "advisors" and high-fee funds. At least with the stock du jour, you know when and what you've lost -- vs. the parasitic drain of fees over many decades.

 

[Phoenix]

Hi,

I'm so glad I saw this thread. I wrote a note to you on my other thread. Yes, we had a crash. Nvidia is flying. AMD is OK. I love the CEO. I'm sticking with it.
I got hurt when the regional banks failed. , I am overweight banks, so I'm still down, alot. But I tell myself I am still ahead from the good years. The trouble is I can't forget how much more I was up. Once they credit my account it mine.

Lets see if LilAlex comes to criticize us again. I made friends with Him, so he will be gentler, I think. He's quite nice. He did give us the business tho.

Hope to see you again.

Annette

Hi Annette,

I am keeping AMD too. I don't see any reason to sell it.

I'm sorry you've been hurt by the banks failing. I hope your holding goes back up again.

Haha, I have him on Ignore (the only one on PS I've ever ignored). It's a shame because he's actually very intelligent and his posts are informative and interesting to read. I find him rigid and too critical and not understanding that people have and are indeed entitled to post their own views.

Please come back and post more. I always enjoy your post and although I haven't been around much myself, I have missed your posts.

 

[Phoenix]

I manage my own and I'm up 20.5% year to date. I don't really worry too much about short term results, though. I care most about my long term financial goals.
Investing is one of my hyper-fixations - along with gemstones and diamonds. So, I'm super passionate about it and spend hours a day researching

I'm the same. I'm the only one I trust with my money. It definitely pays to read and do your own research.

 

[smitcompton]

Hi,

What a nice reunion. I bought Goog on the split. Its on the path to recovery(I hope). I own apple, also bought on the split and AMD. Thats my Tech.
I have transferred funds out of banks and into treasuries. I'm getting 5% for now. I have one more bank to transfer this month.I do feel better if I hold "cash" I don't want to be poor again, so I keep 50% in cash.

I am trying to develop a strategy to sell some stocks and put them also in cash for a trust acc't. I want to get rid of citi, and I still have Rivian. They are losers for now. They were winners for a while. I continue to wait.

My niece will be executor/trustee of my estate and Alex provided a name for an index fund that will help her, I hope.
I have been tempted by one stock, but just keep my ears open on it. Baba.

MusicloverAnthony- I love your ambition. Age 52--nice. Lets keep the thread running.

LilAlex--your strategy is excellent. I hope you have saved people money. I imagine you research carefully, so I respect what you say. We are grateful for your help.

Annette

 

[empliau]

“Of all sad words of tongue or pen, the saddest are these, 'It might have been.”​

John Greenleaf Whittier

I have a silly story of not investing, at least not exactly. In 1991-2 I had some money that I, believe it or not, won on a game show. After the Visa debt was paid, I had two ideas: invest in Disney (a friend thought EuroDisney would really take off) or invest in Apple stock. I had used Apple products for a few years, and it was at a historic low.

My husband thought we should buy a house. So we used it for a down payment. We did well on the house and subsequent houses, but when I think of what even a modest investment in Apple when the stock was trading at 0.44 would be worth now, I want to weep.

Even Disney bought in 1991-2 would have brought great returns!

 

[LilAlex]

So we used it for a down payment.

But...you have a house! It's not like you gambled it away!

I think everyone has stories like that. Decades ago, I wouldn't buy this hot new stock called Amgen because my friends bought it a few months earlier and it had already doubled and I was too smart to get on this bandwagon "so late." (The hot stocks I did buy instead were no Amgen -- but who knew?)

Now I don't buy individual stocks and never will. This is the reason that the typical investor does so much worse than the market as a whole. Even the best-paid managers in the world can't consistently beat the market. But I know it's fun to try and entertaining to think about!

 

[empliau]

Oh, I'm delighted we have a house and we have done reasonably well. But the math on Apple in 1992 vs. Apple now is startling. And I wouldn't have invested much - I figured that at that point either it would cease to be or rise.

After all, $1000 in most stocks wouldn't be a game changer. But I did discuss buying Apple with my husband back then, and the stock has risen 69,000%.

 

[LilAlex]

I did discuss buying Apple with my husband back then, and the stock has risen 69,000%.

But, realistically, the odds are you would have sold it way before the 700X increase. Do you still have all the other stocks you bought in 1992? Back then, I would sell my winners. People who buy individual stocks also tend to sell them.

 

[empliau]

I'm so sorry - this is not realism. This is fantasy. Yes, I thought of investing a small portion of my windfall in the stock and indulge in a sad, sweet might-have-been. Don't bring the cold light of day into it, please!

ETA: That's why I introduced it as a silly story. We all have missed opportunities that we failed to capitalize on, and would probably not have been able to maximise anyway. But this one is a doozy!

 

[smitcompton]

I'm so sorry - this is not realism. This is fantasy. Yes, I thought of investing a small portion of my windfall in the stock and indulge in a sad, sweet might-have-been. Don't bring the cold light of day into it, please!

ETA: That's why I introduced it as a silly story. We all have missed opportunities that we failed to capitalize on, and would probably not have been able to maximise anyway. But this one is a doozy!

Hi,
I don' think any story can compare to the Apple story. Its the fish that got away.

Last evening Cleveland Cliffs announced publicly that US
Steel had dismissed their offer to buy the company. AS I continued to read I decided to buy some shares of US Steel (X) using a limit order. I was hoping to make a few hundred dollars. I placed my limit order of 23.00 (it was selling 22.50) and looked this morning to see how I did. The stock was over 30.00, but I did not see it in my portfolio. I had forgotten to mark that I wanted to buy before the open (a special designation), so by the time the market opened the stock was already above the 23.00 mark. I missed not hundreds. but a few thousand. I am only a little upset with myself. I haven't used a limit order in ages, so I forgot.

Annette

 

[Phoenix]

Hi,
I don' think any story can compare to the Apple story. Its the fish that got away.

Last evening Cleveland Cliffs announced publicly that US
Steel had dismissed their offer to buy the company. AS I continued to read I decided to buy some shares of US Steel (X) using a limit order. I was hoping to make a few hundred dollars. I placed my limit order of 23.00 (it was selling 22.50) and looked this morning to see how I did. The stock was over 30.00, but I did not see it in my portfolio. I had forgotten to mark that I wanted to buy before the open (a special designation), so by the time the market opened the stock was already above the 23.00 mark. I missed not hundreds. but a few thousand. I am only a little upset with myself. I haven't used a limit order in ages, so I forgot.

Annette

Sorry to hear, Annette.

I think we've all got a similar story. I could tell you how I missed making a LOT (and I mean a lot) of money when I had surgery in March 2000 and again last year when I fell ill again. I console myself by saying "it's only money".

On that note though, I just asked one of my nieces a few days ago to be my "standby" in case something like this happens again. I think, hope, I can entrust her with the money and with making the investments in case I'm - God forbid - sick again. I do not ever want to miss another opportunity.

 

[smitcompton]

Hi,

I watch CNBC regularly. Fund managers come on and tell us what stocks they are buying. They always use the phrase, "I bought a quarter of a position, or a half of a position, rarely a whole position.
For years I have been trying to figure out what this means. How many shares are in a position. I've never asked Google. Then a small lightbulb went on and I said maybe a quarter of a position, or a half is different for each person. I wish to sound professional and want to say I bought a half a position, only, as of today I am still unsure of what this may mean. Anyone know the answer?

Annette

 

[LilAlex]

I see some random stuff online but I infer that a "position" may be 10% of your individual-stock portfolio. There is no rhyme or reason that I can tell. Much higher and you are really gambling on one company; much lower and even a success will not move the needle for you.

Back when I was doing this with conviction (and no particular skill or talent), I held about five biotech stocks at a time so I guess my position would have been 20%. When my late father did this (way back) for large-cap value stocks, I would say a position was 5 - 10% for him. I think that "half" and "quarter" parlance that you are encountering is shorthand for conviction and not actual dollar-amount or even percentage. As in, I'm half-convinced or quarter-convinced on this...

 

[Betty Baguette]

The thing that bothers me about the market and the polycrisis stage we have entered is this truism:

You can't have infinite growth on a finite planet.

What to do, what to do?

 

[LilAlex]

The thing that bothers me about the market and the polycrisis stage we have entered is this truism:

You can't have infinite growth on a finite planet.

I agree! But I would have hated to miss the last 100 years of growth -- which is maybe how long folks have been saying this! I don't know when the music stops so I keep playing and I encourage my kids to.

There are, of course, those who say how we will adapt to our finite resources -- and tailor our work and home lives accordingly -- affords an unlimited opportunity for innovation and corporate growth. Like green energy or AI. Every societal problem is a business opportunity! I'm only half-facetious -- I think there is some (slightly sad but also inspiring) truth to that perspective.

 

[smitcompton]

Hi,
A quarter position and a half position are the risk of the trade. A trader sets his own risk parameters. The trader says I will not risk more than 1% on this trade(of his portfolio). That could be a full position. If he say a quarter position, he is only risking .25%. If its a half position he is risking ,50%. on the trade.

I will not be throwing this term around.

Annette

 

[Betty Baguette]

I agree! But I would have hated to miss the last 100 years of growth -- which is maybe how long folks have been saying this! I don't know when the music stops so I keep playing and I encourage my kids to.

There are, of course, those who say how we will adapt to our finite resources -- and tailor our work and home lives accordingly -- affords an unlimited opportunity for innovation and corporate growth. Like green energy or AI. Every societal problem is a business opportunity! I'm only half-facetious -- I think there is some (slightly sad but also inspiring) truth to that perspective.

I hear what you're saying about the last 100 years of growth, @LilAlex.

But if you're wondering "when the music stops", I'd highly recommend listening to the first 8 episodes or so of the Breaking Down: Collapse podcast, linked below (and you can find it on all the other major podcast sites too). It ties together all the polycrises we're facing in an easy to digest fashion, including their likely impacts on the financial system/market. The info is presented in a very matter-of-fact, non-alarmist way. Definitely worth a listen.

The next 100 years of the stock market (or even the next few decades) IMHO will likely be FAR, FAR different from the previous 100 years. Here's the podcast. Let us know your thoughts if you do give it a listen!:

Breaking Down: Collapse | iHeart

Apprehensive about the future? Like many, you likely have a gut feeling that things aren't quite right, but haven’t been able to place your finger on why. That feeling only grows with the increasing political tensions, economic uncertainty, natural disasters, and supply chain disruptions. What...

www.iheart.com

 

[LilAlex]

There has always been bad news and there will always be bad news. I react to a lot of it and sometimes adjust my behavior accordingly.

But in terms of investing, there is not much to do. I will not go to gold. I agree with those who say that if the world goes to $%@, lead is better than gold. And we have some of that.

I am not a fan of ESG for the sake of ESG but this is why ESG as an actual corporate strategy is sound; we all want the world to survive. (Even the smart oil-rich Gulf states are preparing for a post-petroleum future.)

It's not that I am super-sanguine about our future; it's just that it does not really impact how I invest. I guess we'll check back in 100 years.

 

[Betty Baguette]

There has always been bad news and there will always be bad news. I react to a lot of it and sometimes adjust my behavior accordingly.

But in terms of investing, there is not much to do. I will not go to gold. I agree with those who say that if the world goes to $%@, lead is better than gold. And we have some of that.

I am not a fan of ESG for the sake of ESG but this is why ESG as an actual corporate strategy is sound; we all want the world to survive. (Even the smart oil-rich Gulf states are preparing for a post-petroleum future.)

It's not that I am super-sanguine about our future; it's just that it does not really impact how I invest. I guess we'll check back in 100 years.

I agree with this, except for your first sentence, @LilAlex. I think most of us have recency bias when it comes to societal problems. We believe that because most problems of the recent past have resolved, current and future problems will too. Problems come, problems go. But (I and most scientists believe) certain problems we have now are permanent and will only get much worse. For example, climate change. Environmental degradation/resource depletion. Biodiversity loss. A healthy economy depends on a healthy world, which we have now all but lost.

Add to that threats to democracies all over the world in general, and to the U.S. in particular. We're on the cusp of losing our democracy. If we do, what happens to the market?

Anyway, I'm not trying to derail your thread, just trying to look at things realistically. I haven't even listed many other major problems we, and the market, now face and will likely never see resolved. I assume most educated Americans know about them. But we just can't mentally cope with all of them.

But to think the stock market will just keep chugging along, with its usual ups and downs, might be missing the big picture.

 

[LilAlex]

A healthy economy depends on a healthy world, which we have now all but lost.

Sadly, I don't think that this is true. Look at the US in the early 20th century and the current "economic stars" of the developing world. A "healthy world" is a newish concept -- maybe since Rachel Carson?

But more importantly, how is all the (appropriate) fear actionable from an investing standpoint? When do you pull all your money out of the US stock market? I'm sure glad that I didn't at the darkest days at the dawn of the pandemic. The only seemingly-inviolate rule of investing -- and the one that has impressed me the most over my not-short investing lifetime -- is that we can not predict the future.

So what are you going to sell and what are you going to buy to prepare for these end times? Cash is no good (i.e., if there's hyperinflation, etc.) And gold will just get you killed.

Plus, a huge share of the SP500 returns lately have been driven by the tech companies that are trying to address these problems (admittedly, for profit and not out of altruism, per se).

I also know and work with a lot of bright young people (I can't believe that I use that expression with a straight face now) and even helped raise a few and I know the world will be in good -- and probably better -- hands.