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Ask YC: How do you invest your money for long term growth?

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Re: Ask YC: How do you invest your money for long term growth?

#51

Post by epi0Bauqu »

vzn wrote: post #49
epi0Bauqu wrote: post #6

The comments so far are espousing passive investment strategy and good asset allocation, which I agree with, but I was looking for something a little more concrete. So in effort to engender some discussion with hard %s, the following is where I am right now (excluding equity in primary residence). The accuracy (beyond decimal point) is certainly irrelevant, but it came right off a spreadsheet and I left it in because…

If it was 1928 year now, would this portfolio have survived Great Depression? Almost all positions are paper actives. What do happen with the paper actives in case of huge world economical slowdown and depression? I prefer something more reliable than paper (gold, land, real estate, cash flow from the business)

I believe it should, but am interested in your speculation as to how you think it would hold up. About half of it is not in equities (cash, bonds, commodities, real estate). And I did not include actual land holdings in the %s (including our personal residence), which brings it up to a majority. Also, some of the equities are international, and we are in a much more global environment now as compared to 1928. Over 40% of large cap earnings are from abroad.

Are you saying that you hold 100% of your assets in gold and land?

"Cash flow from the business" was specifically excluded from the question, i.e. income does not enter into it.

Re: Ask YC: How do you invest your money for long term growth?

#52

Post by epi0Bauqu »

unknownuser wrote: post #45

I have read on a previous comment in another story about "shorting bonds and longing stocks" but this was given as an example of a bad idea. Why is it so? If in the long term stocks outperform bonds wouldn't this actually be a good strategy for a long-term investor? Obviously the risks would be higher, but since it is over the long term it shouldn't matter, right?

If you go back to that thread, it concludes that there is indeed a place for equities in a balanced portfolio. Your point is exactly the one I was trying to make!
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