31–40 of 357 posts
Does the stock data used suffer from Surviver bias? That is a free download of historical data that lacks failing, delisted companies of the past.
Which makes me think: with index funds becoming more and more popular, should we see bigger and bigger crashes of stocks when they are removed from an index?
It's funny that this is so non-intuitive. My wife continues to try to "time the market" despite me telling her that it's pointless over such a long time horizon. Maybe this will help convince her.
Robinhood seems like an OK way to keep a free portfolio of ETFs approximating a Vanguard all-in-one fund.
My super-unscientific portfolio is loosely based on Vanguard's LifeStrategy Growth & Moderate Growth funds with a sliver of MGK that seemed to both boost returns and moderate declines.
A $5k portfolio would be 6 MGK (10%), 19 VTI (40%), 23 VXUS (20%), 12 BND (20%), 9 BNDX (10%).
From what I can tell, you can hold this portfolio in Robinhood for free. Shouldn't need to re-balance more than once per year or so.
https://personal.vanguard.com/us/funds/snapshot?FundIntExt=I...
https://personal.vanguard.com/us/funds/snapshot?FundIntExt=I...
Pay off your credit cards and max out your 401k/IRA first.
I am not a financial advisor and this is not financial advice! Robinhood seems like an OK way to keep a free portfolio of ETFs approximating a Vanguard all-in-one fund. My super-unscientific portfolio is loosely based on Vanguard's LifeStrategy Growth & Moderate Growth funds with a sliver of MGK that seemed to both boost returns and moderate declines. A $5k portfolio would be 6 MGK (10%), 19 VTI (40%), 23 VXUS (20%),…
Looking at the discussions here I find it interesting that even in something as number driven as the stock market everybody argues about the meaning and the validity of the numbers. There really is no clear picture. But somehow the regular guy is supposed to navigate his way through this jungle of conflicting, confusing or meaningless numbers. And considering the long time frames most people don't have much opportuni…
It astounds me that so many people think they can be great investors. It would be like me trying to build an ark with no experience in carpentry or ship-building. Really it just strikes me as a legal and socially acceptable way to gamble. Please recognize that this is a zero-sum game, and the other person taking your trade is likely a professional who spends their entire work week doing deep analysis.
I don't think it is fair to say that next 100 years will be same as last 100 years: 1. GDP growth is not as high as it used to be anywhere in developed world: http://www.oecd.org/std/productivity-stats/oecd-compendium-o... 2. USA is superpower at the peak. Plenty of other stock market economies hasn't been so successful. E.g. Argentina used to be one of the richest country in the world. Investing in history is easy,…
So what alternative method do you propose for predicting growth (or decline) over the next century?
Also, just as some risky "foreign" markets did awesome a hundred years ago-- that's what the US was to the investing world in 1900, and it did great-- some will do great over the next 100 years. Some will have wipe outs as Russia, Germany and Argentina did. The future is hard to know.
Really though, owning some vanguard funds is a good idea. I'd just hold on to a little real estate as well.
Does the stock data used suffer from Surviver bias? That is a free download of historical data that lacks failing, delisted companies of the past.
Yes sometimes companies are delisted from the S&P500, but if you invest in an S&P500 index fund , then your investment is also automatically adjusted to remove that company. Which makes me think: with index funds becoming more and more popular, should we see bigger and bigger crashes of stocks when they are removed from an index?
I am not a financial advisor and this is not financial advice! Robinhood seems like an OK way to keep a free portfolio of ETFs approximating a Vanguard all-in-one fund. My super-unscientific portfolio is loosely based on Vanguard's LifeStrategy Growth & Moderate Growth funds with a sliver of MGK that seemed to both boost returns and moderate declines. A $5k portfolio would be 6 MGK (10%), 19 VTI (40%), 23 VXUS (20%),…
Earlier quoted context omitted.
> So at Year 1, we take every point on the S&P500 curve, look at every point on the S&P500 that's one year ahead, add in dividends and subtract inflation, and record all points as a relative gain or loss for Year 1. Point #3 is wrong.
While inflation was adjusted for it was not accurately adjusted for as it ignored taxes. If your returns are 10% and inflation is 10% you get taxed on that 10% and lose money. PS: Now if this is for 401k accounts or something that's another story.