Stock market charts you never saw (2021) • Hacker News Board

Re: Stock market charts you never saw (2021)

#181

Post by gkuan » Fri, Jan 20, 2023, 1:26 AM UTC

danuker wrote: post #28

dot1x wrote: post #11

Earlier quoted context omitted.

> getting rid of dividends makes no sense and is borderline intellectually dishonest just to make the point How so? Once you retire, you don't let dividends reinvest. Makes perfect sense.

Dividends aren't enough to cover living expenses. If you plan to withdraw 4% per year, so you preserve your wealth indefinitely, you're more than 2 percentage points short when the dividend yield is 1.71% [1] If you want to live solely from dividends, you'll need more than double the capital. If you want to die with zero [2], it's impossible. I'd much rather invest in a dividend-accumulating index fund and sell as I…

It may be hard to imagine, but dividend yields were not always this low [1]. Investopedia has it usually something healthy over 4% up until 1990s it seems. Over that 1926- time frame, dividends are said to have contributed 32% of the total return of S&P 500 [2].

[1] https://www.investopedia.com/articles/markets/071616/history...

[2] https://www.spglobal.com/spdji/en/research/article/a-fundame...

Re: Stock market charts you never saw (2021)

#182

Post by f5ve » Fri, Jan 20, 2023, 1:29 AM UTC

bumby wrote: post #83

coliveira wrote: post #71

Until the beginning of the 20th century, stocks were viewed as a purely speculative investment. The idea that buy and hold will provide great returns is a modern one and is supported by the growth of the stock market in the 20th century. There is also the issue of survivorship bias. The SP500 and Dow Jones indices regularly discard the losers and add new companies, so we don't know the true results of holding compani…

Do you happen to know where to find historical data on such holdings? For example, how do I find the historical ETF holdings at a particular point in time?

These data exist but in many cases it is expensive to obtain. Even complete historical data for the SP500 is not a trivial thing to find.

(ETF current holdings, I believe, are legally required to be published)

Re: Stock market charts you never saw (2021)

#183

Post by MuffinFlavored » Fri, Jan 20, 2023, 1:41 AM UTC

jorblumesea wrote: post #153

How is data before 1950 even relevant in today's investing world? Between MMT, finanicialization of the economy, stock buy backs, Bretton Woods, tax codes, robo investing and indexing... Interesting stuff but really not super helpful in assessing risk.

it seems impossible to assess risk of current environment based on history

i wonder if that’s been perpetually true for all of history?

Re: Stock market charts you never saw (2021)

#184

Post by htkibar » Fri, Jan 20, 2023, 1:47 AM UTC

nostromo wrote: post #78

The Titanic was built a bit over 100 years ago for 1.5m pounds -- today that'd buy you a nice London two-bedroom apartment. I wonder if in 100 years from now, people will casually be talking about their nice (but modest) London two-bedroom apartment they bought for 100m pounds.

Turkish did that. In my childhood bread was 200.000 liras for example.

About a decade ago they renominated it. "New Turkish Lira" was born, where 1.000.000 Old Lira = 1 Lira.

So as another comment has mentioned, probably that would happen.

Re: Stock market charts you never saw (2021)

#185

Post by roflyear » Fri, Jan 20, 2023, 1:49 AM UTC

onlyrealcuzzo wrote: post #158

roflyear wrote: post #132

Earlier quoted context omitted.

This is just misinformation, I have worked with investment firms and family offices that regularly buy government securities.

The vast majority of HNI wealth is not in treasuries. Some of them have astonishing amounts of money. They own everything under the Sun - obviously some treasuries. There's a lot of rich people - some of them at times are owning a lot of treasuries. The reality is - a small percentage of treasuries are owned by individuals (including - and mostly - 401ks) - I linked to the data above. Anecdotal evidence that you help…

That is correct, probably just a few percent. But the language here is making it sound like they are not purchased at all by individuals or family offices, and that is not true.

Re: Stock market charts you never saw (2021)

#186

Post by ironyman » Fri, Jan 20, 2023, 2:03 AM UTC

worik wrote: post #96

For modern computing/finance type of people (I was but now have reformed) the lack of financial data is a problem. Even if you can get access to every trade, which is hard, the amount of data is not what modern machine learning types require. Thr EMH is a hard mistress too. There is no amount of data that can help you solve unsolvable equations. So alot fall into this trap, synthetic data. Some of the best statistici…

There are many different types of inefficiencies that may arise in the short-term, and there are plenty of funds that very skillfully capture them. But they're all constrained by how much of their capital they can trade before they're the ones moving the price.

Jim Simons makes 80% a year from his fund but he still has to find boring ways to invest that extra money because it can't go back into the fund.

The beauty of diversified buy and hold is that it allows investors to stay invested to reap the benefits of compound growth. Over a long period of time EMH does hold up pretty well.

Re: Stock market charts you never saw (2021)

#187

Post by rgmerk » Fri, Jan 20, 2023, 2:11 AM UTC

NovemberWhiskey wrote: post #114

ghaff wrote: post #113

Earlier quoted context omitted.

Right. Life annuities may or may not be a good deal. But that's certainly the main way to not be essentially forced to pass on assets. (Modulo real estate you own and are living in.) And, as you say, defined benefit pensions basically work the same way--although, in the US, current ones are fairly uncommon outside public sector--although a lot of people still have them from years past. Just to add. Bonds and CDs do h…

In the UK this is actually the typical pattern for defined-contribution schemes; I haven't looked recently but it used to be the case that you were legally required to buy an annuity with 75% of your tax-deferred retirement savings.

You’re not required to any more, but there are heaps of people on annuities there.

I haven’t read anything about it yet but a lot of them must be in pretty awkward straits because most aren’t fully indexed to inflation…

Re: Stock market charts you never saw (2021)

#188

Post by csomar » Fri, Jan 20, 2023, 2:17 AM UTC

xyzzy123 wrote: post #104

smaddox wrote: post #98

Earlier quoted context omitted.

Private debt dwarfed public debt until very recently, and it's still significany higher: https://braveneweurope.com/steve-keen-what-is-the-role-of-pu... Also GDP is a terrible proxy for economic prosperity. A broken window adds to GDP, but subtracts from prosperity. If we had a better proxy for prosperity, it would be easier to see if government debt was actually net negative or net positive effect. As is, all argume…

I think prosperity (particularly if we include health, education, wellbeing etc) is unfortunately very difficult to measure and any attempt necessarily incorporates a lot of speculation and ideology. A forest cleared creates wealth & prosperity, but what was the value of the forest that was lost? What value do we put on natural amenity, biodiversity, a pristine environment? An employee works very long hours, numbers…

As the divide gets more extreme (between GDP per capita numbers and reality), I think we’ll soon have a “Quality of Life” kind of an index.

You can have a high salary in country A, but live in a small studio, eat shit-food and have to take a crappy metro for work.

Or you can take a much lower salary, live in a nice 2-Br apartment, eat at nice restaurants and take a new nice metro for work, and still be able to afford a car.

You’d need $120k/year to afford 1 in New York, and $30k/year to afford 2 in Kuala Lumpur.

Re: Stock market charts you never saw (2021)

#189

Post by ClumsyPilot » Fri, Jan 20, 2023, 2:27 AM UTC

nwiswell wrote: post #171

MichaelDickens wrote: post #108

Earlier quoted context omitted.

This might justify discounting dividends (eg reducing them by 20%), but not removing them entirely.

Moreover the more modern approach is share repurchases, which are largely not subject to the tax drag and use the same money that was used historically for dividends.

It is worth noting that until 1982, stock buybacks were illegal—deemed as market manipulation

Re: Stock market charts you never saw (2021)

#190

Post by rgmerk » Fri, Jan 20, 2023, 2:28 AM UTC

8note wrote: post #125

ghaff wrote: post #103

Earlier quoted context omitted.

I think parent is saying that you can't die with zero if you plan to live off dividends. (Because you need to keep owning the stock throwing off the dividends.)

I'd expect a good portion of deaths involve very expensive health care for the last few months or years of life. Live off dividends, then sell to pay for the healthcare right before you die

In the US.

In most other developed countries a) healthcare is funded by the government (to a first approximation). b) end-of-life healthcare expenditure is considerably lower outside the US.