Investing Strategies

[arahop]

Just curious to find out what others on here do as I am pretty conservative myself, only investing in Index funds. I do however take a few shots on some stocks like Nvdia, I got in on that at 90 a share. I still think is a smart investment at 144 per share. Any strategies on portfolio allocation would be much appreciated.

 

[connor_in]

Just curious to find out what others on here do as I am pretty conservative myself, only investing in Index funds. I do however take a few shots on some stocks like Nvdia, I got in on that at 90 a share. I still think is a smart investment at 144 per share. Any strategies on portfolio allocation would be much appreciated.

50% towards scratchers / 50% towards Powerball

 

[BleedBlueGold]

Low-cost index funds with Vanguard. 80/20 stocks/bonds. Ignore the noise. Add to the pot and let it ride.

Studies back up this investing strategy over the long haul. 100% stocks if you're young. 90/10 is ok too. But typically 80/20 beats them all.

 

[arahop]

Low-cost index funds with Vanguard. 80/20 stocks/bonds. Ignore the noise. Add to the pot and let it ride.

Studies back up this investing strategy over the long haul. 100% stocks if you're young. 90/10 is ok too. But typically 80/20 beats them all.

What percentage returns are you seeing on the bond portion?

 

[tussin]

Low-cost index funds with Vanguard. 80/20 stocks/bonds. Ignore the noise. Add to the pot and let it ride.

Studies back up this investing strategy over the long haul. 100% stocks if you're young. 90/10 is ok too. But typically 80/20 beats them all.

This is basically all the lay investor should do. Find some F500 index funds (or better ETFs), set it, and forget it.

Individual investors have neither the time nor resources to intelligently make bets. Individual investing is fun, and there is some merit to having fun while investing; but ultimately, it's just throwing darts.

 

[IrishLax]

All you need to know about investing --
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[IrishLax]

This is basically all the lay investor should do. Find some F500 index funds (or better ETFs), set it, and forget it.

Individual investors have neither the time nor resources to intelligently make bets. Individual investing is fun, and there is some merit to having fun while investing; but ultimately, it's just throwing darts.

The only bet I've ever gotten (significantly) right was Chipotle. I was a true believer eating there 5+ times a week in college, so I sold a little Microsoft and Disney stock I had gotten as gifts as a little kid and put that money into burritos. It's too bad I was so broke back then it didn't really matter but at the end of the day I think I took ~$800 to about 15 grand at it's peak. Made the mistake of still holding onto it though...

Worst bet -- Under Armour. Woof.

 

[wizards8507]

Buy and hold VTI. That is all.

 

[tussin]

The only bet I've ever gotten (significantly) right was Chipotle. I was a true believer eating there 5+ times a week in college, so I sold a little Microsoft and Disney stock I had gotten as gifts as a little kid and put that money into burritos. It's too bad I was so broke back then it didn't really matter but at the end of the day I think I took ~$800 to about 15 grand at it's peak. Made the mistake of still holding onto it though...

Worst bet -- Under Armour. Woof.

That's an impressive run... and $15K ain't nothing to scoff at. Your story brings up another challenge that essentially all individual investors face -- we have no idea when to sell.

Somewhat similar to you, I've made like 400% on Netflix. That being said, I also thought Potbelly was the next big restaurant concept. So WTF do I know.

 

[Old Man Mike]

If the Brazilian mining powers allowed people to invest (I don't know if they do), and if I were younger, I'd take a wild fling on Niobium. This sounds like a joke to the unwashed I'm sure, but this is vital in every cellphone you have plus is a military-industrial Critical Resource --- and Brazil controls about 90% of it (By the way, that means that the US military will not allow anything really bad to happen in Brazil.) Usage has been expanding like a rocket lately. --- VERY strange Critical Resource situation.

 

[BleedBlueGold]

If we're sharing successes and failures:

Not only did I have the misfortune of missing on my hot stock of the century, but I missed it twice. I've been a believer in Elon Musk for a long time. When word broke he was working on an electric sedan, I immediately went to my etrade account to buy stock...

Then I was introduced to Dave F'n Ramsey. While I'm forever indebted to this man for bringing out my "gazelle intensity" when it comes to personal finance, it's because of him that I liquidated my portfolio to pay off my debts, passing up the opportunity to buy Tesla at $19/share in the process.

Fast forward to just a few years ago and Tesla was in the $120's/share. I phoned my father-in-law to have him call his broker at Merrill and get some data for me. Both the broker and my FIL said to pass. I listened.

Today Tesla is $342/share and not only do I own zero shares, but my mother-in-law, via the same broker, now owns stock and she bought in around $250.

I will never forgive myself for missing out on what would've been a $100,000 return (as I type this).

 

[BleedBlueGold]

What percentage returns are you seeing on the bond portion?

I'd have to check. Last I knew, it was around 2% over the past 5 years. 15% on the stocks, I think.

Cumulatively, I have a +9% return since inception
+23% in 2016

I don't check it that often. I just set up automatic purchases and forget it.

 

[BleedBlueGold]

Low-cost index funds with Vanguard. 80/20 stocks/bonds. Ignore the noise. Add to the pot and let it ride.

Studies back up this investing strategy over the long haul. 100% stocks if you're young. 90/10 is ok too. But typically 80/20 beats them all.

To clarify, the above is my non-retirement account. I have a 401k through work and it's set up in a similar fashion. My employer's plan doesn't offer all Vanguard funds though, so I had to do a mix. I basically took what they offered and set up an allocation that is similar to VTSAX and VBTLX, still 80/20.

 

[arahop]

If we're sharing successes and failures:

Not only did I have the misfortune of missing on my hot stock of the century, but I missed it twice. I've been a believer in Elon Musk for a long time. When word broke he was working on an electric sedan, I immediately went to my etrade account to buy stock...

Then I was introduced to Dave F'n Ramsey. While I'm forever indebted to this man for bringing out my "gazelle intensity" when it comes to personal finance, it's because of him that I liquidated my portfolio to pay off my debts, passing up the opportunity to buy Tesla at $19/share in the process.

Fast forward to just a few years ago and Tesla was in the $120's/share. I phoned my father-in-law to have him call his broker at Merrill and get some data for me. Both the broker and my FIL said to pass. I listened.

Today Tesla is $342/share and not only do I own zero shares, but my mother-in-law, via the same broker, now owns stock and she bought in around $250.

I will never forgive myself for missing out on what would've been a $100,000 return (as I type this).

Man, I have a buddy that told me to get in on Tesla about 5 years ago. He told me to invest all the money I could in it. I didn't and will kick myself forever. Musk IMO is a once in a life time mind. I like Ramsey too but it made me pretty conservative. I've followed NVDIA for a couple years now. I kicked myself for not getting in earlier than 90 a share. I believe in them and didn't make the same mistake​.

 

[Veritate Duce Progredi]

1. Pay down high interest debt (sounds like you don't have any)
2. Save 20%+ (not everyone can do this but it's a good number to strive for)
3. Emergency fund built up (everyone has different criteria, we keep ours just below 20k)
4. Vanguard
5. Vanguard
6. Keep a modest amount in savings just in case. You never know when the emergency fund could be depleted.
7. Not required but we maintain a couple extra savings accounts that we auto-deposit into on paydays. This helps us save for big home expenditures, vacations, etc.

 

[BobbyMac]

#1 = Know you have 2 year's cash available. Whether that's on hand or family is your business.

I'm going to skip real estate because I have no idea what your level of competency is or what market you live in. If you have trade skills there is money to be made there. Owning rental property is also a huge winner in solid markets, a pain in the ass if you are in a stagnant market. Actually, rental properties are a pain in the ass 99% of the time regardless of your plan and their returns.

Do you have access to a 401k matching plan? If so, always contribute whatever amount that secures all of the available employee match and place no importance on the current price or market. You are acquiring position.

At 32 you should be 100% in stocks. 90% in a low cost Index fund. Around your age, I got into Vanguard Index 500 in Jan 97. Max'd out until I left the company a decade later. That was the easiest and by the time they put me in the ground, the best investment I ever made. If I live long enough, I'll basically have taken $50k from Cox Communications and turned it into millions.

If no 401k is available. Max out other tax advantage savings plans.

With the other 10% of your available investment budget, invest on your own through an online broker like Ameritrade. You will win some and that's good but the real value will come from your losers. It will teach you real quick that your 401k's and IRA's are off limits to your own foolishness. Also, you'll be up an hour before the bell every morning (hope you live on the eastcoast lol) watching Bloomberg, CNBC, FBN and you'll get a daily education.

Most importantly, go sit down with a/a few Certified Financial Planner(s) who is/are in their 40's / early 50's and let them give you advice as to a comprehensive investment plan. You don't have to stay with them but a professional needs to analyse your variables vs. your expectations.

 

[MNIrishman]

I'm a big believer in investing in children because they're our future. So once a week on Wednesdays I head down to the local library to volunteer my time by editing the liberal propaganda out of the science section.

 

[Ndaccountant]

Don't be afraid to sell when things are going well. Not selling is usually way more mentally taxing when it bites you in the ass than not buying.

 

[Wild Bill]

Any strategies on portfolio allocation would be much appreciated.

I applaud anyone who actually does their homework and invests in individual stocks. I used to do a decent job but I'm just too busy with everything else so I got rid of individual companies and stick with index funds, gold/silver, and a REIT. I'm a big fan of dividend/dividend reinvestment and the REIT I own dishes out a monthly dividend and has done great for me so far.

I own several rentals too. I've done far better with the rentals than I have in the market but it requires more work. It's something I consider all the time - work a bit more for a much better return or take the easy money in the market? Rentals can be a pain in the ass but my return thus far has been great and streams of income make it worthwhile.

Lululemon was the stock I missed out on. It seemed like overnight every women at the gym had a nice ass and they all wore the same black tights. It wasn't popular at all and I remember discussing them with some colleagues who joked I was investing in asses. Felt somewhat foolish and then the stock went from less than $10/share to $50/share plus and every women in the city was wearing them within months.

The best advice I can give you or anyone is to invest in yourself, trust yourself and invest in what you know. I know, it's cliche...but it's true.

 

[woolybug25]

I applaud anyone who actually does their homework and invests in individual stocks. I used to do a decent job but I'm just too busy with everything else so I got rid of individual companies and stick with index funds, gold/silver, and a REIT. I'm a big fan of dividend/dividend reinvestment and the REIT I own dishes out a monthly dividend and has done great for me so far.

I own several rentals too. I've done far better with the rentals than I have in the market but it requires more work. It's something I consider all the time - work a bit more for a much better return or take the easy money in the market? Rentals can be a pain in the ass but my return thus far has been great and streams of income make it worthwhile.

Lululemon was the stock I missed out on. It seemed like overnight every women at the gym had a nice ass and they all wore the same black tights. It wasn't popular at all and I remember discussing them with some colleagues who joked I was investing in asses. Felt somewhat foolish and then the stock went from less than $10/share to $50/share plus and every women in the city was wearing them within months.

The best advice I can give you or anyone is to invest in yourself, trust yourself and invest in what you know. I know, it's cliche...but it's true.

You literally just described me to a T. From the investing strategy, to buying rentals, hell... I did my first credit underwriting on lululemon. Thought about investing, but legally couldn't.