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Show HN: Inflation-adjusted stock charts – Total Real Returns

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Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#181

Post by pedrosorio »

kurthr wrote: post #155
pedrosorio wrote: post #71

Having all lines normalized so they start from a common point at x = 0 would be helpful. That would allow reading the total returns as percentage of the initial (1987) investment and compare them. Similarly in the drawdown chart, if it starts at 1987, it makes no sense to start the dollar at -81%. If I am looking at a chart from 1987 to 2022, I want to see how the dollar did compared to other assets in that time peri…

You don't really need that on a logarithmic plot since the ratio of stock prices is always a constant vertical separation. It is very necessary on linear pricing plots.

Can you tell at a glance which asset had a better return since the start date until March of 2009? A plot of total ROI (with all assets starting at y = 0) would make that obvious (for any given end date).

As far as I can tell, the different intercepts just add noise (price of a single stock) that is not helpful to visualize what the plot is supposed to be showing (total returns).

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#182

Post by georgeecollins »

fundamental wrote: post #9

If the goal is to demonstrate relative performance over time, wouldn't it be useful to use a normalization such that all lines either start at the same point (e.g. simulating investing X amount) or ending at the same point (showing requirement to get to X final amount)?

Isn't the comparison of relative performance in the trend line? That's a year over year % change for every asset, so it doesn't matter what value you start with.

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#183

Post by danans »

mechanical_bear wrote: post #163
jl2718 wrote: post #127

This period has been very special because of the 401k, which is itself part of the growth story of the corporate legal structure. I think this is coming to an end. Corporate boards and officers no longer represent the best long-term interests of the companies and shareholders they represent. It’s also a very precarious legal status as an arbitrary judicial ruling can make or break a company. Finally, and perhaps most…

I liked your explanation but you undermine your write up by discussing something you clearly have no business discussing: >> People tithe and sacrifice to their church for a promise of rewards in the afterlife. This is a fundamental misunderstanding of tithing and I’m not going to get into that at the moment, but it makes me consider if you are discussing other things in your write up that you don’t have experience w…

> This is a fundamental misunderstanding of tithing and I’m not going to get into that at the moment,

To the extent that tithing (or a non Christian equivalent) supports a religious institution's facilities and payroll and programs to be help less well off members of the religious group, it's a bit socialistic, with the huge caveat that - by definition - it is not universal, since to receive such benefits you must usually be an adherent or serious prospect of conversion to the religion.

I'm sure most people realize that their tithing money isn't getting them anything in a presumed afterlife, and that the purpose is to support the institution's basic functions and it's outreach and expansion efforts.

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#184

Post by fleischhauf »

Drblessing wrote: post #180

I've often read Stocks average +10%/year, is this true when factoring in taxes + inflation? Wondering if other investments that appear less attractive on paper are actually better than traditional equities.

aren't they all subject to inflation?

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#185

Post by tomcam »

jl2718 wrote: post #127

This period has been very special because of the 401k, which is itself part of the growth story of the corporate legal structure. I think this is coming to an end. Corporate boards and officers no longer represent the best long-term interests of the companies and shareholders they represent. It’s also a very precarious legal status as an arbitrary judicial ruling can make or break a company. Finally, and perhaps most…

> People tithe and sacrifice to their church for a promise of rewards in the afterlife.

You… you may want to post some receipts on this, or perhaps edit your comment

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#186

Post by bolasanibk »

Drblessing wrote: post #180

I've often read Stocks average +10%/year, is this true when factoring in taxes + inflation? Wondering if other investments that appear less attractive on paper are actually better than traditional equities.

From what I understand, SPY returns adjusted for inflation over long term average to 7%.

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#187

Post by danans »

jl2718 wrote: post #170
mistrial9 wrote: post #150

Earlier quoted context omitted.

> People tithe and sacrifice to their church for a promise of rewards in the afterlife. could you strengthen your argument by omitting casual broad-brush explanations of religion, please?

Well, I can't anymore, but, I might have instead said something about how religion is commonly maligned for such practices. This is only to show that modern investment practices bear strong elements of ritualistic faith. Your response is most welcome. Thank you.

> This is only to show that modern investment practices bear strong elements of ritualistic faith.

Conversely, ritualistic faith has a long history of financial investing, evidenced by its tendency to procure very high value real estate for itself with the funds of it's adherents.

Also, the cathedrals of Europe are glistening with the golden dividends that accrued from religious investment in the conquest of the Americas.

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#188

Post by ricksunny »

Do you capture the effects of a ticker symbol delisting from the index? Trivial for a single stock of course, but looking across a portfolio, then the effects from delisting from an index, new listings into the index, stock splits, and M&A inevitably becomes a thing.

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#189

Post by gedy »

mywittyname wrote: post #166
smallerfish wrote: post #102

Earlier quoted context omitted.

Don't buy a house until the real estate market crashes. Then buy. I bought a fixer-upper in 2008 for 200k; sold it for 425k 5 years later. Recently it sold for 650k (we still get redfin notifications.) In the meantime I bought a house for 625k (nice house with some rough edges) and sold it 18 months ago in covid real estate madness for 950k. We certainly put money into both houses over time, but we'd never have been…

> Wait a year or two. The Great Financial Crisis will be the only event of this nature in our lifetimes. The country would need to overbuild like crazy to cause housing to crash like that again. Everyone is expecting housing prices to fall in "a year or two." I've been hearing this for two years now. The market has a habit of doing the opposite of what people expect it to.

Not sure where you are, but California at least has clear up/down cycles, but they take many years unlike a stock bubble.

E.g. I the last housing bubble started popping in 2005-2006, but didn't bottom until about 2010-11

Re: Show HN: Inflation-adjusted stock charts – Total Real Returns

#190

Post by arghnoname »

FooBarWidget wrote: post #160
stavros wrote: post #154

Earlier quoted context omitted.

Are "buy" and "live in a car" the only two options?

You can rent, but that's money wasted. The longer you rent, the longer you didn't invest. Also rents are higher than mortgage payments, making it worse.

If rent really is lower than the mortgage payment (assuming the alternative return on the downpayment is taken into account, etc) for an equivalent property, then buying is pretty reasonable in most circumstances.

I'm observing rents way, way below mortgages, but it's very location dependent.

When making decisions about where to put my money, I stopped worrying about what other people are going to do and are doing, what the market might do, etc, and instead think what makes _sense_ for me to do. If some expense makes sense for me, offers good value, etc, independent of attempting to prognosticate the future, it probably does for others as well and the investment will probably work out fine. If it doesn't, it doesn't matter, it still made sense for me to do it.

For me, this has meant buying a house when lots of my peers were running scared at what turned out to be the bottom of the housing market, selling one recently, and renting for the moment. In each case, this was just the cheaper and 'sensible' approach. I think people overcomplicated this stuff.

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