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Ask HN: Do you invest in the stock market?

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Re: Ask HN: Do you invest in the stock market?

#61

Post by intended »

davidw wrote: post #52
rdl wrote: post #51

Earlier quoted context omitted.

Tech has moats. Tech is probably the least regulated global industry -- in absurd countries like India, tech companies thrive in spite of bureaucracy. In highly unstable places like Israel, tech companies can compete too. I suspect Africa will have tech as a #3 segment (after extractive mining and some kinds of (relatively destructive) agriculture). Aviation is kind of the diametric opposite of this -- heavily regula…

100+ years ago, trains had 'moats' too, but a lot of those stocks blew up too. How does back-testing tech as a sector work out over the past 40 years or so?

Trains also had huge amounts of skull duggery going on, at a time where pump and dump scams involved people physically forging fake shares and selling them on the market to destroy the price of said stock.

Plus railways are cap intensive as well - tech investment comparatively is far lower, with a greater pay off.

Re: Ask HN: Do you invest in the stock market?

#62

Post by davidw »

intended wrote: post #61
davidw wrote: post #52

Earlier quoted context omitted.

100+ years ago, trains had 'moats' too, but a lot of those stocks blew up too. How does back-testing tech as a sector work out over the past 40 years or so?

Trains also had huge amounts of skull duggery going on, at a time where pump and dump scams involved people physically forging fake shares and selling them on the market to destroy the price of said stock. Plus railways are cap intensive as well - tech investment comparatively is far lower, with a greater pay off.

If you think there is no monkey business in tech... well, I've got a bridge you can invest in:-)

I think that tech is certainly a growth sector, but does that translate into buying into stocks in the whole sector and coming out ahead? There is some pretty vicious competition, no? DEC, SGI, Yahoo, Altavista, Wang Laboratories, Commodore International... the list of companies that once flew high and then tanked is fairly long.

Re: Ask HN: Do you invest in the stock market?

#63

Post by hassy »

peterbraden wrote: post #57
hassy wrote: post #45

Earlier quoted context omitted.

I'll worry about it when I have it. But my current thinking is along the lines of: 10-20% in highly speculative stuff (much more so than stocks) and the rest in super-safe stuff (much safer than stocks).

what's more speculative, and what's safer than stocks? If you're looking for low volatility, bonds are often touted as 'safer' - but look at how safe they've been over the last decade. There's a risk/reward balance in every asset, I don't think ruling out stocks based on the perception that they're risky is necessarily wise.

early stage startups and property for example

Re: Ask HN: Do you invest in the stock market?

#64

Post by krober »

beagle3 wrote: post #50
krober wrote: post #28

Earlier quoted context omitted.

This is what I tell myself, but I continually hear stories (friends of friends, of course) of people hitting it big and wonder if I just don't get it.

> I continually hear stories (friends of friends, of course) of people hitting it big and wonder if I just don't get it. For every hitting it big, there is an opposite (and often larger) story of losing it big. Often by the same people -- except they are happy to tell you about their wins and don't talk so much about the losses. It's not even a zero sum game -- the fees and spreads ("friction") are non-trivial.

Great point, even then I'm taking people at their word. There's no shortage of hyperbole when people talk about "some guy I know".

Re: Ask HN: Do you invest in the stock market?

#65

Post by DanBC »

tomgallard wrote: post #15
acheron wrote: post #6

Index funds. You can't beat the market consistently. Maybe you can get lucky for awhile, but if you're relying on that, might as well go to Vegas and have more fun at it.

Tell that to Warren Buffet! Seriously though, of course the average investor cannot beat the market, it doesn't mean it isn't possible for an individual to do so, or that it is all down to chance. One approach is to focus on small companies. Most active funds will not invest here (it is not worth the time when they would only be able to invest a tiny fraction of their funds). As such these companies tend to be under-…

> or that it is all down to chance.

No, it is all down to chance.

Re: Ask HN: Do you invest in the stock market?

#66

Post by gadders »

Lazare wrote: post #37

Do yourself a favour; invest in an index. Don't play the stock picking game. The human mind works against you; everyone is convinced that they can beat the market. If it's even a skill (and it doesn't seem to be) it's a vanishingly rare one even among investment professionals . It's very tempting to think that you could be the next Warren Buffet, but honestly, you're about as likely to get a gold medal in the next Ol…

I worked in a FAMOUS PRIVATE BANK once. We used to get the business heads to come and speak to us about their area. One week it was the head of fund management.

"We do this type of fund, and that type of fund... But that's just for the clients. If it's your own money buy Index Trackers."

Re: Ask HN: Do you invest in the stock market?

#67

Post by intended »

davidw wrote: post #62
intended wrote: post #61

Earlier quoted context omitted.

Trains also had huge amounts of skull duggery going on, at a time where pump and dump scams involved people physically forging fake shares and selling them on the market to destroy the price of said stock. Plus railways are cap intensive as well - tech investment comparatively is far lower, with a greater pay off.

If you think there is no monkey business in tech... well, I've got a bridge you can invest in:-) I think that tech is certainly a growth sector, but does that translate into buying into stocks in the whole sector and coming out ahead? There is some pretty vicious competition, no? DEC, SGI, Yahoo, Altavista, Wang Laboratories, Commodore International... the list of companies that once flew high and then tanked is fair…

Heh heh, let me talk to my Nigerian backer.

That said I had similar misgiving about the original: " invest in tech" thesis. In theory I see the merit, but what is the practical implementation?

Maybe he could use an indexed fund or another instrument which matches a composite of stocks focused on tech.

Re: Ask HN: Do you invest in the stock market?

#68

Post by eli_gottlieb »

padobson wrote: post #31

I do not. I believe wholeheartedly in Mark Cuban's advice here: "The first step to getting rich is having cash available. You arent saving for retirement. You are saving for the moment you need cash. Buy and hold is a sucker’s game for you. This market is a perfect example. Right at the very moment when cash creates unbelievable opportunity, those who followed the buy and hold strategy have no cash." Emphasis mine. F…

That sounds almost like what I formalized into my investment robot's algorithm.

Re: Ask HN: Do you invest in the stock market?

#69

Post by actionbrandon »

intended wrote: post #30
hassy wrote: post #25

Wouldn't ever do it. Stock market is for suckers. (Based on reading Nassim Nicholas Taleb and conversations with people that worked on trading floors.)

Taleb is not a source of investing advice - unless you were interested in trading, in which case he has a few points.

I'll rephrase for hassy. "investing" is for suckers. the only people making any money in the market are professional traders who aren't at all making decisions based on "trends" or "fundamentals".

see: dynamic hedging by nasim taleb--a book that sits on many professional traders desks in which taleb makes more than a few points about trading.

Re: Ask HN: Do you invest in the stock market?

#70

Post by actionbrandon »

DanBC wrote: post #65
tomgallard wrote: post #15

Earlier quoted context omitted.

Tell that to Warren Buffet! Seriously though, of course the average investor cannot beat the market, it doesn't mean it isn't possible for an individual to do so, or that it is all down to chance. One approach is to focus on small companies. Most active funds will not invest here (it is not worth the time when they would only be able to invest a tiny fraction of their funds). As such these companies tend to be under-…

> or that it is all down to chance. No, it is all down to chance.

or cheating--the oracle knows all about that.
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