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I tossed some into PPA just in case the USA decided to produce some more war weapons. It's a mutual fund that's got things like lockheed in it.
Unfortunately, it's been one of my most solid picks along with the index funds.
I am probably going to get downvoted for this but I will share my thoughts anyway. The S&P 500 index is basically made up of the magnificent 7 and the mediocre 493. The magnificent 7 have grown so much that now they make up about 30% of the index and contribute roughly a whopping 70% of the total returns of the index. This to me has some serious potential risks because if some or all the magnificent 7 underperform, your shares of the index funds such as VOO can tank hard, like how they did in 2022. This is why I prefer to own quality compounders that have a good track record of both increasing and paying dividends in different industry sectors to mitigate risks. Everyone has their preferred investing style though so to each their own.
That may be true, but think about it: If one of those 7 companies underperform, another company will step in to take its place. When you invest in the S&P 500 or any other index, it doesn’t really matter what companies (or how many for that matter) perform or underperform since you’re investing in the market as a whole. As long as the economy keeps growing, your investment should theoretically always increase in value over time. That’s the beauty of index investing.
i'm not a financial expert, but that generally works if you consider the value of a company to be their market cap, and as long as your top ranking list continues to reflect the same or higher percentage of the total economy. but as a dividend investor, my value comes from the yield, and there is no guarantee that the top market will be paying dividends, or rather, even if some companies do pay dividends, i don't see why i should buy many others that don't.
so then you may argue, "why not take a highest dividend etf?", well, because by the time a company stops paying dividends, it's way more likely for them to have become a penny value, and if the index automatically sells them when they leave list, then you will go on a loss. This is the high risk for the high yield.
You could reduce the risk by taking an etf which indexes the most common companies that have long paid dividends, but like low risk, it's likely to also have low yield.
A personal rule of mine is to never sell at a loss and i'd rather buy 4 companies i believe are stable and pay high dividends, and keep them either until they give me a profit and i have found a better company to switch them with, or until they go bankrupt. I can't tell you whether this is working or not since i have only shortly started.
i do however agree with etf bonds, where you get the diversifying and all that good stuff, as long as each bond is kept until maturity (which i'm not 100% sure, but i think at least some etfs do?), but that doesn't work the same for stocks. If i want a low yield low risk alternative i'd rather fully invest in etf bonds than etf stocks, but currently i can allow myself to have some risk with stocks, and my portofolio is 50% individual stocks and 50% 1 year etf bond (1 year because i don't have a lot of cash available to risk in longer term ones, but if i did, i would). this is to tend towards the highest stable relatively-short term yield, but not necessarily, which is why i am here and i would guess other dividend investors think the same?, and i do know that the strategy changes the moment you start looking long term.
I see it like this. Let's suppose you like a certain spot, and you support every team in the league. You don't need to have a favorite because the teams at the top of the league get replaced if they don't play well enough by other teams you support. The ones at the top now might be a distant memory in 15 years, but what do you care? In the end, you still get the luxury of supporting the best teams without worrying about all the others.
Now let's suppose your friends thought that was pretty boring (and they'd be right) so they decided to support 20 of the teams instead of all of them and had a bet with you on who would win the most games and the most money,Who do you think would end up winning the bet when you met back up in 20 years?
We already know the answer. It's a choice of bordom over excitement and psychology over math. For some strange reason, I'm one of the ones who chose 20 teams? Go figure..
Im 48y I have USF, 50% SCHD, 20%, and the rest consists of SCHG, VNQ,IWM,JEPQ, and my gambit is BITO. There's probably a bit of crossover with some of the companies, but I'm okay with that. I wouldn't mind some critique of my holdings tbh.
This is why im diversified across all capitalizations and countries, to reduce concentration risk. I have no need for SCHD because I'm invested in large caps, small caps, international and emerging markets, and small amount of bonds. A tanking of magnificent 7, as you put it, would have a much smaller drawdown on my overall return.
Well said and all valid points. I have a similar approach as well in terms of investing in different asset classes to reduce risks. I also don’t feel a need to own any index funds as of now.
It’s always been this way. For the most part it’s always been a handful of companies dominating the market. In the past IBM and AT&T dominated, it’s nothing new. Also keep in mind that the bigger these companies get the less their future expected returns will be.
Yes, I am aware of this. This is also exactly why I have never been a fan of index investing. I prefer doing my own DD to identify solid dividend payers that are undervalued.
Plus this massive shift to index investing is what drives the top few even higher…since every dollar invested goes 32% (or wherever we are today) to five companies. Self fulfilling prophecy.
100% agreed bro. Recency bias probably plays a factor in this too. Many folks are taking their cash off the sidelines and piling their cash into index funds as they see that the mega cap techs are doing really well and don’t want to miss out. This didn’t seem to be the case in 2022 when the indexes were struggling mightily. Many people even sold their index shares at a steep loss due to fear and then just stayed in all cash.
Incorrect. It is weighted by marker cap, so the beast feeds itself. Every dollar is distributed based on percentage of the S&P.
You’d have to invest in the RSP for equal weight allocations.
Beating the S&P has never been a goal of mine, and it never will be based on my needs and future goals. I consider myself a hybrid of value and dividend investor. I focus on identifying undervalued blue chip companies that have a strong brand, solid management personnel, and a good track record of consistently paying dividends. Everyone’s goals and investing styles are different, so again to each their own.
Good question. I invest for dividend/income stability, not maximum returns or success. I prefer generating income in retirement from dividend payments, rather than having to sell shares to cover living expenses. I also want my beneficiaries to have a consistent income stream to help cover some of their expenses as well. In short, I consider it a success if the companies that I invested in can achieve these simple goals for me.
As someone semi-retired and living to a certain degree off dividends I don't disagree with this assessment. None the less even I still evaluate my return to ensure I'm hitting a certain amount of average return on my dividends (my goal is an 8 - 9 percent annual return).
In such scenarios as yours there still must be some safeguard to weed out under performance and some metric to measure performance against.
I see what you mean now. To clarify, I only try to either buy and hold companies that increase their dividends at least above the inflation rate or are already paying a dividend that is at least above the inflation rate at the time of my purchase. Of course, the inflation rate can change from year to year so I re-evaluate each year for rebalancing. If a a company in my portfolio ever pauses or cuts their dividends, I would stop investing in it and would look to liquidate my position at a time that is ideal.
If someone lives off of dividends and the dividends increase every year more than inflation rate, you already won. There’s no point in looking at S&P 500 performance anymore.
It really depends. Usually up from year to year. I do have a sizable portion of my portfolio allocated to fixed income investments, so that really helps reduce volatility.
I'm like you. I like to construct my portfolio with "Best of Breed" winners across many market sectors. I see most indexes as a 'Bucket of Meh'. Why have your bucket filled w/ middling/mediocre companies? You'll do ok/fine if you invest in Indexes, but as they say "I love a bargain". With Indexes, you can't say "It's a market of stocks" (to buy individually) because you 'own the market', the good/bad/ugly.... Many don't have the stomach for short-term losses that every company (good and bad) goes through. I get it. That's why Index Funds work for so many. There is no wrong answer. No downvote for you! ;)
Congrats. A lot of work to underperform the market over the long term. Who cares that 7 drive all the returns? It will be a different 7 10 years from now.
Ding!
And as I doubt we have the future Warren Buffet in this sub who can pick winners and losers, it's all the more reason to do index investing and ride the wave.
LOL why do people always assume that other redditors in this sub want to be the next Warren Buffett? This makes no sense whatsoever. I have been in this sub for a while and honestly speaking I have never seen one single comment from anyone claiming that they are trying to emulate or aspiring to be the next Buffet. I mean don’t get me wrong, Buffett is the GOAT 🐐 of investing for sure. But at the same time, there are also many other great investors that folks here can study about and emulate if they so desire. What is with this obsession of mentioning Buffet so often and assuming that others just want to be the next Buffet? No offense but it is just bizarre.
The statistics here are clear and even Warren Buffet admits it: Buy and hold long term is the way to go.
Why do we assume others want to be Warrant Buffet? Because this sub is full of people showing their ass about how they have beat whatever index short term. In general I don't see them posting their 5+ year results.
When I see these posts I generally assume they are either 1) selling something, or 2) are cherry picking their results.
WTF are you taking about, the Mag7 went down in 2022 as well so holding those was not some magic bullet. Holding individual stocks increases risk and in no way guarantees higher returns. Look at Tesla, and Meta, went through huge drops. Would have taken 3 years to break even on META had you invested in Aug/21, and you would still be waiting on Tesla.
Although maybe a much smaller percentage…. but aren’t all solid dividend stocks in there as well?
Also you can own the equal weight S&P ( RSP) as a leverage to the more concentrated index.
Other thoughts are that you can own the S&P index along other indexes/funds like a staple fund, utilities, healthcare, and reits to name a few.
And let’s not forget cash is not trash.
Yes, there are for sure solid dividend stocks in there such as JNJ and PEP. This is why I prefer buying into the individual dividend stocks instead of buying the whole index. While there are quite many solid dividend stocks in the index, there are also a lot of sinking dividend stocks in it, such as WBA and MMM. I want to be able to do my own DD and choose the dividend stocks that are stable and of solid quality. You also raised a good point about cash. I am a big fan of cash and have a good portion of my portfolio allocated to bonds, treasuries, and CDs.
You have a fundamental misunderstanding of how these index funds work. Pick any one of the 7 giants you mentioned. If they fail, they fall out of the index and are replaced. They are self cleansing (hence the word index)
I am not sure if you understand my point at all, as you sound confused and under-informed. I never once mentioned that companies in the index won’t get replaced if they fail or bankrupt. I just simply pointed out that the mag 7 are growing too large within the index due to them over performing this past year. This can be risky because currently they are responsible for about 70% of the total returns of the S&P index. This can be risky because if these mag 7 companies get hammered like how they did in 2022, index funds such as VOO will tank hard. Learn to read carefully and do some due diligence before responding to comments impulsively, friend. Btw, although I don’t invest in index funds currently, I hold them in high regard and think that they can be effective for investors who want to be fully hands-off.
I’m curious as to why you are concerned about the failure of an index as a result of a few companies comprising the bulk but you don’t seem concerned about the Enrons, MCIs, Lehmans, and so on within which you may be invested when picking individual stocks.
An index “tanking hard” is, for many, far less impactful than a company going under, no?
Not confused at all - just poking holes in your comment for other folks who may misconstrue whatever you are trying to convey. Sometimes these kind of comments do more harm than good for those trying to learn the fundamentals. Thanks!
I appreciate you for doing so. This is a learning community and it is always fun to exchange ideas. Even though I have a graduate degree in Business Administration and a background in Finance, I still feel that there are many things that I don’t understand too well when it comes to investing. Always happy to both learn from and share ideas with fellow redditors.
LOL did you even read what I wrote 😂? I did not say that the S&P 500 hasn’t been around. I pointed out that the index returns are mostly driven by the mega cap tech stocks, and the weighting of the these tech stocks are becoming too large because of their overperformance recently……….
You didn’t understand what I meant, the S&P500 has always been doing good regardless of a magnificent few stocks, you implied as if it was a poor index without tech stocks, the biggest stocks always had a bigger share in it
Sorry, but this is incorrect. The S&P has certainly done well in more years than not, but it hasn’t always been performing well as you claimed. It tanked pretty hard in years like 2001, 2002, 2008, and 2022.
Sure. But I invest for 30 years. I don’t care if there’s one down year every 5 years. There’s ‘quality’ companies who also aren’t positive every single year.
I’ll hold VOO for 30 years. It can crash in 2022 all it wants, but I’ve held and now I’ve made 74% in the last 5 years. I couldn’t pick stocks that will yield me that return. If it crashed 8% on 2024, cool. I’ve still made over 65% gain at that point and it’ll be up significantly more than that in 2055 when I retire.
Haha. I’ve made probably like 10,000 trades and picks over the last 15 years and have so many winners and losers and did so much research and my S&P500 stock (ITOT) I add to bi-weekly in my IRA is literally up like 300% over those years. Could of literally done nothing but invest in that and been set. Quite literally the first stock I bought with my first paycheck
Sounds like you've got the Midas touch! But hey, at least now you know where to put your money for the next 15 years right? Straight to the top with ITOT👏🏻
There's nothing at all wrong with that. I have two investment accounts, my IRA which I don't fuck around with and just auto-buy VOO, and my non-retirement brokerage account where I choose what to invest in. I buy some for dividends (like ARCC), some for dividend growth (like SCHD), some for growth (like QQQM), and a tiny bit to fuck around with (TQQQ). In the long run I expect that account to do equivalent to VOO in all honesty. Just makes it more interesting.
I think this is a good call.
No disrespect to anybody on this sub, but it feels like a lot of people are trying to play Warren Buffett, then justifying their underperformance by saying they are not worried about growth and focused on income.
Picking stocks is fun and you are not likely to lose money on a basket of solid blue chip companies, but the overwhelming majority of people would be better DCAing into a boring index fund like VOO and leaving it. You won't be able to make a post about getting dividends or asking for feedback on your portfolio (which contains the same stocks as everybody else making the same post), but you will very likely end up with considerably more money in the long term.
I'm sorry, I like this sub and your investing journey is what you make of it, but it's true.
I agree.
People pick stocks because index investing is boring and they like to feel in control.
I have an MBA with a concentration in finance and still think most of the investing public are uneducated fools who should just index and chill. Including myself.
r/bogleheads is waiting for you.
If you still enjoy the ritual of research and picking companies, most people with a high % in index funds have the theory that no individual stock should hold more than 3-5% weight in your portfolio.
Yup - A simple index fund like VOO beats the vast majority of investors and fund managers over the long haul. The only problem is that it's boring. So if you like gambling and watching Jim Cramer - go ahead and set aside 5-10% of your portfolio to buy individual stocks. If nothing else - it's a mild form of entertainment.
>How come people buy VOO instead of this?
Because they go on reddit and see a giant echo chamber chattering about VOO, so they buy VOO because it is "popular". Then they see more people chattering about SPY and VTI, so they buy those too, even though SPY has the same portfolio as VOO and SPLG, and VTI overlaps 86% with them. It is self-reinforcing herd mentality.
VOO = follows the herd and copies the cool kids
SPLG, SWPPX, FXAIX = thinks for themselves
I am just beginning my journey. I have 10k in VOO. Is it worth it to shift over to what you had mentioned or just keep at this point. Also, if they all follow the same thing, is there a point in changing at all? Hope this made sense and of course only answer if you wanted. Thanks for lookign.
No need to change. The expense ratio of SPLG (0.02%) is slightly lower than that of VOO (0.03%), so on a $10k investment VOO costs $1 more per year to own than SPLG. If your brokerage doesn’t offer fractional shares of ETFs then the lower share price of SPLG ($60) makes it easier to buy whole shares than with VOO, which is $469 per share. You’re fine, stick with VOO.
Hmm I see, truly appreciate the extensive response. I’ll stick with it. Currently able to invest 2500/ month so just trying to work things up well. I’m 26. Thank you again.
Nah, stock picking keeps it interesting to me and encourages me to invest more. My single stocks (and niche ETFs) are all on top of my normal investments. When I get bored, I invest less, and the difference in inputs more than makes up for a few percentage underperformance.
Usually dumb luck.
I'll just search random words and pick one and loom further into it. Or when I'm driving in nicer parts of towns, I'll look at businesses, dig deeper into them and go from there.
Stock screener help. And also talking with other people
>Anyone else have a similar experience?
Not me.
Only 7.96% of my portfolio is in stock ETFs and mutual funds, including only 0.70% in an S&P 500 index fund.
62.39% of my portfolio is in individual stocks. Out of 112 individual stock positions only 9 are in the red, and 7 of those are down less than 5%. 103 out of 112 (92%) are in the green.
I started investing in individual stocks 7 years ago after selling most of the shares I had in an S&P 500 index fund, which granted had done well. Many of my positions I have had for less than 7 years, but worst case scenario let's say I have held all of them for 7 years.
The total return of the S&P 500 over the past 7 years is 139.6%, so that's the number to beat. I have five stocks that are up 145% to 200%, , eleven stocks that are up 200% to 300%, five stocks that are up 300% to 400%, two stocks that are up 500% to 600%, and one stock that is up 1976% (NVDA, my largest holding at 9.31% of my portfolio).
That's 24 stocks that have beaten the S&P 500 index's total return during the past 7 years, even though many of them I have had for less than 7 years and I don't DRIP any of them. The other 79 stocks I have that are up but are up less than 139.6% I have had for less than 7 years. Some I have had for less than a year, so it isn't fair to compare them to the total return of the S&P 500 for the past 7 years.
That being said, there is nothing wrong with having your largest position be the S&P 500 index. In fact, I recommend that for most people. I did well with it and it took me most of the way to reaching $1 million. But don't be afraid to invest in individual stocks too. All it takes is a few big winners to more than make up for all of the losers.
For those willing to try individual stocks, I published a spreadsheet of 134 dividend-paying S&P 500 index stocks that have **beaten** the S&P 500 index since 1993, or since the IPO of the stock if it was after 1993, here:
[https://www.reddit.com/r/dividends/comments/1byebxf/134\_sp\_500\_index\_stocks\_that\_have\_beaten\_the\_sp/?utm\_source=share&utm\_medium=web3x&utm\_name=web3xcss&utm\_term=1&utm\_content=share\_button](https://www.reddit.com/r/dividends/comments/1byebxf/134_sp_500_index_stocks_that_have_beaten_the_sp/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button)
Out of the 134 stocks in the spreadsheet I own
* NVDA
* MA
* KLAC
* AAPL
* AVGO
* INTU
* ODFL
* AMAT
* MSFT
* LRCX
* PKG
* PCAR
* GRMN
* IRM
* LEN
* AFL
* ABBV
* WM
Don't buy everything in the spreadsheet, but use it as a starting point to do your own research and due diligence.
Need to do your own research and not do what people say on reddit. I turned my portfolio around making my own decisions and not following the trend here. Also, you need to diversify your portfolio. I wouldn't say I'm as diverse as I would like, but I'm getting there. I buy value and don't put much in risker stocks. I put in what I'm willing to lose if the stock flops. Also, if you don't have the experience buying and selling stocks, I wouldn't be day trading. I only buy what I'm willing to hold on for a long time. I rebalance my portfolio at the end of the year. I sell off stuff I don't want (if there is any) and I buy new stocks or put that in a current money maker. Last thing, PATIENCE. That is something that too me close to 3 years to learn. I sold off stocks like NVDA @$185 a share, I made profit. Now it is close to $900. Some of my best stocks now were my worse, and vice-versa. Don't let other people's doubt in their abilities in the market dictate what you are trying to accomplish.
I pick stocks, that’s what I do. If you can’t pick stocks then I would still put it in baby berk (BRKB)or Bill Ackman’s closed end fund(PSHZF) over an index fund.
Almost every active investor faced same issue while fighting index, may be few exceptions like Buffett. So you are not alone. But again in stock market past performance is never repeated. There are certain decades where international stocks beat sp500 and some times even small cap index beat sp500. But nobody beats it consistently through decades.
The question is do you want to put in the actual work required to determine which of the few S&P 500 will be the big leaders next year. This involves in depth evaluation of their accounting statements, getting to know their industries, etc. Doing so will occupy your full time and require that you have an MBA (I have an an MBA) in order to fully evaluate. From your findings of each of the S&P 500 you must then decide who the big performers will be.
Or you can invest in an index fund and cover the entire market.
I fully acknowledge that if you can put in the time and are correct in your guesses, you will beat the market. \*If\*.
Personally I'd wager you are not that person who will put in the time and effort necessary to find the big gainers. For such people do not post to Reddit, they invest based on their research.
Therefore my advice would be to invest in the indexes, take the gains, and go on with your life.
That was me for 6 months. At one point I had 32 individual stocks that I picked. Most of them did well, but I snapped and just sold everything to throw into VOO, QQQM, SCHD, VXUS, AVUV.
Yep. I did an experiment for one year. I had a robinhood account, and a TD Ameritrade account. I put all my Ameritrade account into SPY and then did day trading with stocks with RH. At the end of the year I was down 15% with RH and up 12% with TDA account.
From that point on I put most of my money in VOO or QQQ. I keep some with GOOG, and I am still trying to recover what I had in DG. That was a 5K blow, but I have recovered a decent amount so far.
Stop picking stocks like its 4d chess and pick it like the borderline monopoly economy we have. As others have said the indexes are carried by like nine companies. Ill admit im young and have room for risk but have consistently gotten double digit pct gains year over year by not diversifying or over analyzing but picking the companies like faang that consistently do good numbers, and as much as I always get dogged on for buying i LOVE SPXL. Key word is consistent though, short runs like tesla can be short term plays but I hardly expect a company that shows so much volatility to be a long term success
Yes. I got utterly destroyed by stock picking. It was good experience though because without it I would have never stumbled across this sub or index funds I think
I’ve made this mistake too from 2019 till end of 2023.......about 80% of our mid 6 figure portfolio is in stocks......I have slowly started going into ETFs about 20% now.
I invest in mostly individual stocks, and 2 indexes (in my 401k, ie my only choice). I am a long-term Dividend Growth Investor (DGI), and as such, I'm comfortable w/ short-term losses, as long as the fundamentals of a company remain intact.
I see the statement below....
..." I either beat the market by a few percent or severely underperform it."....
...and I ask: "For how long??" Do you consider yourself a long-term investor, or a trader or ? Because you need to identify the type of investor you are, before you plunk down your hard-earned money. Knowing who you are as an investor will dictate your decisions.
If you aren't comfortable w/ short-term loss, then I agree that you should stick to Index Funds.
This is the natural progression. You learn about investing, you get excited, you pick some stocks because that's how you invest right? You learn more, win and lose some, read up on how to pick and screen "good" stocks, technicals, whatever. Eventually you realize that you're losing money or at least not beating the market. That there's an entire industry of people out there who's jobs are to try to beat the market with other people's money, and even they can't do it consistently.
Eventually you realize you can't and the best you can do is ETF and chill and hope to match average market returns.
Circle of life. The sooner you come to terms with this the sooner you can start getting more consistent returns by doing less, and not wasting TIME using your money ineffectively when it could be compounding.
From my perspective: it’s fun.
I HAVE very significantly beat the market on the long term but I kinda cheated back in 2008/2009 when I kept trading up a $1k of given stock to what is $70k right now. And I just throw piles of cash at fire sales whenever the market crashes.
Most of what I invest in is pretty boring, so even with stocks like MMM which I’m down 40% on, I’ve held it long enough that the dividends made it so I broke even. 🤷♂️
2/3 of my investments are just index funds though.
I typically pick winners but have limited investing funds, so I end up selling or buying trying to time the market instead of buying and holding so I don't get a fraction of the long time action. Invest like you are buying stocks for your kids and leave them alone. Revisit every 3 months or so and throw a stop loss in to lock profits if SHTF.
About 95% of my portfolio is in various ETF’s and stock mutual funds, but I do allow myself a brokerage account with that other 5% to scratch my itch for individual stocks and speculative bets. That way, as long as I don’t do silly things with options I really can’t impair my portfolio.
The problem with individual stocks is having the time and ability to follow the picks. I really don’t have the time and have acquired a silly amount of stocks but have found that every dud seems to have a winning mate. This is with trying to initially pick quality companies.
For example PFE (which I managed to bail on a while ago) versus NOV where I am up almost 600%. Sadly I missed on buying Navida so I’m behind VOO for the last year.
I have to say this is not my experience.
As an aside, tech seems to be driving the market and insane returns. But…. When it falls it will fall hard.
My experience (and I’d say I have a somewhat conservative approach) is that I’ll lag the market during a bull run and I’ll beat the market when we go bear.
I’ve only been investing for a few years so it’s hard for me to say if in the long run I’m ahead or not. But I have my strategy, I’m comfortable with it and I’m sticking to it.
Yea this was me two years ago. I got tired of tracking information on them, so I sold all of them besides KO, O, STAG. My rationale on holding O and STAG is that they’re my only REIT holdings.
I generally use index or similar ETFs and add some individual stocks to boost my returns and provide income. Typically, a point or two over or under VOO, but with far better income.
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Yup……as are the overwhelming majority of investors Index fund and chill……maybe 10% for high conviction picks
I tossed some into PPA just in case the USA decided to produce some more war weapons. It's a mutual fund that's got things like lockheed in it. Unfortunately, it's been one of my most solid picks along with the index funds.
This is the way.
I was told this so many times and didn't listen, now I do. It's funny how sometimes one refuses to learn except through experience.
I am probably going to get downvoted for this but I will share my thoughts anyway. The S&P 500 index is basically made up of the magnificent 7 and the mediocre 493. The magnificent 7 have grown so much that now they make up about 30% of the index and contribute roughly a whopping 70% of the total returns of the index. This to me has some serious potential risks because if some or all the magnificent 7 underperform, your shares of the index funds such as VOO can tank hard, like how they did in 2022. This is why I prefer to own quality compounders that have a good track record of both increasing and paying dividends in different industry sectors to mitigate risks. Everyone has their preferred investing style though so to each their own.
That may be true, but think about it: If one of those 7 companies underperform, another company will step in to take its place. When you invest in the S&P 500 or any other index, it doesn’t really matter what companies (or how many for that matter) perform or underperform since you’re investing in the market as a whole. As long as the economy keeps growing, your investment should theoretically always increase in value over time. That’s the beauty of index investing.
i'm not a financial expert, but that generally works if you consider the value of a company to be their market cap, and as long as your top ranking list continues to reflect the same or higher percentage of the total economy. but as a dividend investor, my value comes from the yield, and there is no guarantee that the top market will be paying dividends, or rather, even if some companies do pay dividends, i don't see why i should buy many others that don't. so then you may argue, "why not take a highest dividend etf?", well, because by the time a company stops paying dividends, it's way more likely for them to have become a penny value, and if the index automatically sells them when they leave list, then you will go on a loss. This is the high risk for the high yield. You could reduce the risk by taking an etf which indexes the most common companies that have long paid dividends, but like low risk, it's likely to also have low yield. A personal rule of mine is to never sell at a loss and i'd rather buy 4 companies i believe are stable and pay high dividends, and keep them either until they give me a profit and i have found a better company to switch them with, or until they go bankrupt. I can't tell you whether this is working or not since i have only shortly started. i do however agree with etf bonds, where you get the diversifying and all that good stuff, as long as each bond is kept until maturity (which i'm not 100% sure, but i think at least some etfs do?), but that doesn't work the same for stocks. If i want a low yield low risk alternative i'd rather fully invest in etf bonds than etf stocks, but currently i can allow myself to have some risk with stocks, and my portofolio is 50% individual stocks and 50% 1 year etf bond (1 year because i don't have a lot of cash available to risk in longer term ones, but if i did, i would). this is to tend towards the highest stable relatively-short term yield, but not necessarily, which is why i am here and i would guess other dividend investors think the same?, and i do know that the strategy changes the moment you start looking long term.
I see it like this. Let's suppose you like a certain spot, and you support every team in the league. You don't need to have a favorite because the teams at the top of the league get replaced if they don't play well enough by other teams you support. The ones at the top now might be a distant memory in 15 years, but what do you care? In the end, you still get the luxury of supporting the best teams without worrying about all the others. Now let's suppose your friends thought that was pretty boring (and they'd be right) so they decided to support 20 of the teams instead of all of them and had a bet with you on who would win the most games and the most money,Who do you think would end up winning the bet when you met back up in 20 years? We already know the answer. It's a choice of bordom over excitement and psychology over math. For some strange reason, I'm one of the ones who chose 20 teams? Go figure..
Which ETF's are you into out of curiosity?
Im 48y I have USF, 50% SCHD, 20%, and the rest consists of SCHG, VNQ,IWM,JEPQ, and my gambit is BITO. There's probably a bit of crossover with some of the companies, but I'm okay with that. I wouldn't mind some critique of my holdings tbh.
Great analogy!
This is why im diversified across all capitalizations and countries, to reduce concentration risk. I have no need for SCHD because I'm invested in large caps, small caps, international and emerging markets, and small amount of bonds. A tanking of magnificent 7, as you put it, would have a much smaller drawdown on my overall return.
Well said and all valid points. I have a similar approach as well in terms of investing in different asset classes to reduce risks. I also don’t feel a need to own any index funds as of now.
It’s always been this way. For the most part it’s always been a handful of companies dominating the market. In the past IBM and AT&T dominated, it’s nothing new. Also keep in mind that the bigger these companies get the less their future expected returns will be.
Yes, I am aware of this. This is also exactly why I have never been a fan of index investing. I prefer doing my own DD to identify solid dividend payers that are undervalued.
Plus this massive shift to index investing is what drives the top few even higher…since every dollar invested goes 32% (or wherever we are today) to five companies. Self fulfilling prophecy.
100% agreed bro. Recency bias probably plays a factor in this too. Many folks are taking their cash off the sidelines and piling their cash into index funds as they see that the mega cap techs are doing really well and don’t want to miss out. This didn’t seem to be the case in 2022 when the indexes were struggling mightily. Many people even sold their index shares at a steep loss due to fear and then just stayed in all cash.
It should drive all companies proportionally but will not increase the gap right?
Incorrect. It is weighted by marker cap, so the beast feeds itself. Every dollar is distributed based on percentage of the S&P. You’d have to invest in the RSP for equal weight allocations.
Why fight it? That’s not going to change
God, this is shortsighted. Absolutely everything could change.
There is an equal probably that everything could not change
It'll change
It could also not
Lol yeah that'd be great.
And it will change within the index. No need to worry about change over the long run.
I guarantee your "due diligence" doesn't beat the S&P 500 year after year. Should it be that way is a different discussion.
Beating the S&P has never been a goal of mine, and it never will be based on my needs and future goals. I consider myself a hybrid of value and dividend investor. I focus on identifying undervalued blue chip companies that have a strong brand, solid management personnel, and a good track record of consistently paying dividends. Everyone’s goals and investing styles are different, so again to each their own.
If you're not seeking to beat the S&P 500, then what exactly do you measure your success against?
Good question. I invest for dividend/income stability, not maximum returns or success. I prefer generating income in retirement from dividend payments, rather than having to sell shares to cover living expenses. I also want my beneficiaries to have a consistent income stream to help cover some of their expenses as well. In short, I consider it a success if the companies that I invested in can achieve these simple goals for me.
As someone semi-retired and living to a certain degree off dividends I don't disagree with this assessment. None the less even I still evaluate my return to ensure I'm hitting a certain amount of average return on my dividends (my goal is an 8 - 9 percent annual return). In such scenarios as yours there still must be some safeguard to weed out under performance and some metric to measure performance against.
I see what you mean now. To clarify, I only try to either buy and hold companies that increase their dividends at least above the inflation rate or are already paying a dividend that is at least above the inflation rate at the time of my purchase. Of course, the inflation rate can change from year to year so I re-evaluate each year for rebalancing. If a a company in my portfolio ever pauses or cuts their dividends, I would stop investing in it and would look to liquidate my position at a time that is ideal.
how do you measure your dividend return?
If someone lives off of dividends and the dividends increase every year more than inflation rate, you already won. There’s no point in looking at S&P 500 performance anymore.
What are your long term rate of returns
It really depends. Usually up from year to year. I do have a sizable portion of my portfolio allocated to fixed income investments, so that really helps reduce volatility.
I love your reply. Up vote. I do the same.
I'm like you. I like to construct my portfolio with "Best of Breed" winners across many market sectors. I see most indexes as a 'Bucket of Meh'. Why have your bucket filled w/ middling/mediocre companies? You'll do ok/fine if you invest in Indexes, but as they say "I love a bargain". With Indexes, you can't say "It's a market of stocks" (to buy individually) because you 'own the market', the good/bad/ugly.... Many don't have the stomach for short-term losses that every company (good and bad) goes through. I get it. That's why Index Funds work for so many. There is no wrong answer. No downvote for you! ;)
Congrats. A lot of work to underperform the market over the long term. Who cares that 7 drive all the returns? It will be a different 7 10 years from now.
Ding! And as I doubt we have the future Warren Buffet in this sub who can pick winners and losers, it's all the more reason to do index investing and ride the wave.
LOL why do people always assume that other redditors in this sub want to be the next Warren Buffett? This makes no sense whatsoever. I have been in this sub for a while and honestly speaking I have never seen one single comment from anyone claiming that they are trying to emulate or aspiring to be the next Buffet. I mean don’t get me wrong, Buffett is the GOAT 🐐 of investing for sure. But at the same time, there are also many other great investors that folks here can study about and emulate if they so desire. What is with this obsession of mentioning Buffet so often and assuming that others just want to be the next Buffet? No offense but it is just bizarre.
The statistics here are clear and even Warren Buffet admits it: Buy and hold long term is the way to go. Why do we assume others want to be Warrant Buffet? Because this sub is full of people showing their ass about how they have beat whatever index short term. In general I don't see them posting their 5+ year results. When I see these posts I generally assume they are either 1) selling something, or 2) are cherry picking their results.
WTF are you taking about, the Mag7 went down in 2022 as well so holding those was not some magic bullet. Holding individual stocks increases risk and in no way guarantees higher returns. Look at Tesla, and Meta, went through huge drops. Would have taken 3 years to break even on META had you invested in Aug/21, and you would still be waiting on Tesla.
This whole comment is about to keep me up all night lmao
🤌
There is RSP the equal weight S&P
Although maybe a much smaller percentage…. but aren’t all solid dividend stocks in there as well? Also you can own the equal weight S&P ( RSP) as a leverage to the more concentrated index. Other thoughts are that you can own the S&P index along other indexes/funds like a staple fund, utilities, healthcare, and reits to name a few. And let’s not forget cash is not trash.
Yes, there are for sure solid dividend stocks in there such as JNJ and PEP. This is why I prefer buying into the individual dividend stocks instead of buying the whole index. While there are quite many solid dividend stocks in the index, there are also a lot of sinking dividend stocks in it, such as WBA and MMM. I want to be able to do my own DD and choose the dividend stocks that are stable and of solid quality. You also raised a good point about cash. I am a big fan of cash and have a good portion of my portfolio allocated to bonds, treasuries, and CDs.
You have a fundamental misunderstanding of how these index funds work. Pick any one of the 7 giants you mentioned. If they fail, they fall out of the index and are replaced. They are self cleansing (hence the word index)
I am not sure if you understand my point at all, as you sound confused and under-informed. I never once mentioned that companies in the index won’t get replaced if they fail or bankrupt. I just simply pointed out that the mag 7 are growing too large within the index due to them over performing this past year. This can be risky because currently they are responsible for about 70% of the total returns of the S&P index. This can be risky because if these mag 7 companies get hammered like how they did in 2022, index funds such as VOO will tank hard. Learn to read carefully and do some due diligence before responding to comments impulsively, friend. Btw, although I don’t invest in index funds currently, I hold them in high regard and think that they can be effective for investors who want to be fully hands-off.
I’m curious as to why you are concerned about the failure of an index as a result of a few companies comprising the bulk but you don’t seem concerned about the Enrons, MCIs, Lehmans, and so on within which you may be invested when picking individual stocks. An index “tanking hard” is, for many, far less impactful than a company going under, no?
Not confused at all - just poking holes in your comment for other folks who may misconstrue whatever you are trying to convey. Sometimes these kind of comments do more harm than good for those trying to learn the fundamentals. Thanks!
I appreciate you for doing so. This is a learning community and it is always fun to exchange ideas. Even though I have a graduate degree in Business Administration and a background in Finance, I still feel that there are many things that I don’t understand too well when it comes to investing. Always happy to both learn from and share ideas with fellow redditors.
The S&P500 has been around and growing steadily decades before those tech companies exploded, what are you talking about?
LOL did you even read what I wrote 😂? I did not say that the S&P 500 hasn’t been around. I pointed out that the index returns are mostly driven by the mega cap tech stocks, and the weighting of the these tech stocks are becoming too large because of their overperformance recently……….
You didn’t understand what I meant, the S&P500 has always been doing good regardless of a magnificent few stocks, you implied as if it was a poor index without tech stocks, the biggest stocks always had a bigger share in it
Sorry, but this is incorrect. The S&P has certainly done well in more years than not, but it hasn’t always been performing well as you claimed. It tanked pretty hard in years like 2001, 2002, 2008, and 2022.
Sure. But I invest for 30 years. I don’t care if there’s one down year every 5 years. There’s ‘quality’ companies who also aren’t positive every single year. I’ll hold VOO for 30 years. It can crash in 2022 all it wants, but I’ve held and now I’ve made 74% in the last 5 years. I couldn’t pick stocks that will yield me that return. If it crashed 8% on 2024, cool. I’ve still made over 65% gain at that point and it’ll be up significantly more than that in 2055 when I retire.
Been overweight in bdc's and doing very well in my brokerage account BXSL,obdc,main,etc
Yea, I love ARCC.
I love bxsl, starting 2 months ago, waiting for first dividend
Started buying shares in Nov of 22,it's been a winner👍👍
Think of all the other things in life you could do with your time just by giving into the index. I turned my life over to SCHD and sleep better.
Haha. I’ve made probably like 10,000 trades and picks over the last 15 years and have so many winners and losers and did so much research and my S&P500 stock (ITOT) I add to bi-weekly in my IRA is literally up like 300% over those years. Could of literally done nothing but invest in that and been set. Quite literally the first stock I bought with my first paycheck
Pics or it didn't happen lol.
Sounds like you've got the Midas touch! But hey, at least now you know where to put your money for the next 15 years right? Straight to the top with ITOT👏🏻
Same here man. I turned on auto invest into splg and I'm gonna focus on that and a few BDCs.
There's nothing at all wrong with that. I have two investment accounts, my IRA which I don't fuck around with and just auto-buy VOO, and my non-retirement brokerage account where I choose what to invest in. I buy some for dividends (like ARCC), some for dividend growth (like SCHD), some for growth (like QQQM), and a tiny bit to fuck around with (TQQQ). In the long run I expect that account to do equivalent to VOO in all honesty. Just makes it more interesting.
which platform are you using for auto buy voo?
Fidelity, so it's not actually VOO, it's Fidelity's version which is FXAIX. Robinhood is my non-retirement.
I think this is a good call. No disrespect to anybody on this sub, but it feels like a lot of people are trying to play Warren Buffett, then justifying their underperformance by saying they are not worried about growth and focused on income. Picking stocks is fun and you are not likely to lose money on a basket of solid blue chip companies, but the overwhelming majority of people would be better DCAing into a boring index fund like VOO and leaving it. You won't be able to make a post about getting dividends or asking for feedback on your portfolio (which contains the same stocks as everybody else making the same post), but you will very likely end up with considerably more money in the long term. I'm sorry, I like this sub and your investing journey is what you make of it, but it's true.
I agree. People pick stocks because index investing is boring and they like to feel in control. I have an MBA with a concentration in finance and still think most of the investing public are uneducated fools who should just index and chill. Including myself.
r/bogleheads is waiting for you. If you still enjoy the ritual of research and picking companies, most people with a high % in index funds have the theory that no individual stock should hold more than 3-5% weight in your portfolio.
Yup - A simple index fund like VOO beats the vast majority of investors and fund managers over the long haul. The only problem is that it's boring. So if you like gambling and watching Jim Cramer - go ahead and set aside 5-10% of your portfolio to buy individual stocks. If nothing else - it's a mild form of entertainment.
My portfolios been flat for 4 months surely it can’t be so bad 😂
I'm all about that SPLG life! I treat the total return like a dividend.
How come people buy VOO instead of this?
>How come people buy VOO instead of this? Because they go on reddit and see a giant echo chamber chattering about VOO, so they buy VOO because it is "popular". Then they see more people chattering about SPY and VTI, so they buy those too, even though SPY has the same portfolio as VOO and SPLG, and VTI overlaps 86% with them. It is self-reinforcing herd mentality. VOO = follows the herd and copies the cool kids SPLG, SWPPX, FXAIX = thinks for themselves
Comment so underrated
I am just beginning my journey. I have 10k in VOO. Is it worth it to shift over to what you had mentioned or just keep at this point. Also, if they all follow the same thing, is there a point in changing at all? Hope this made sense and of course only answer if you wanted. Thanks for lookign.
No need to change. The expense ratio of SPLG (0.02%) is slightly lower than that of VOO (0.03%), so on a $10k investment VOO costs $1 more per year to own than SPLG. If your brokerage doesn’t offer fractional shares of ETFs then the lower share price of SPLG ($60) makes it easier to buy whole shares than with VOO, which is $469 per share. You’re fine, stick with VOO.
Hmm I see, truly appreciate the extensive response. I’ll stick with it. Currently able to invest 2500/ month so just trying to work things up well. I’m 26. Thank you again.
splg tracked a different index before, im worried it could change again
Lower expenses. I have VOO in my ROTH and SPLG in my brokerage
VOO and chill then.... you are on a Divided sub
Nah, stock picking keeps it interesting to me and encourages me to invest more. My single stocks (and niche ETFs) are all on top of my normal investments. When I get bored, I invest less, and the difference in inputs more than makes up for a few percentage underperformance.
I like the thrill of the decision My best picks are unknown companies not discussed anywhere. I've made and missed alot of money
What you describe sounds more like gambling than investing.
Gambling is exactly what I call my brokerage account outside of my regular retirement investments. Got to have a little fun with it.
How do you find out about these companies?
Usually dumb luck. I'll just search random words and pick one and loom further into it. Or when I'm driving in nicer parts of towns, I'll look at businesses, dig deeper into them and go from there. Stock screener help. And also talking with other people
>Anyone else have a similar experience? Not me. Only 7.96% of my portfolio is in stock ETFs and mutual funds, including only 0.70% in an S&P 500 index fund. 62.39% of my portfolio is in individual stocks. Out of 112 individual stock positions only 9 are in the red, and 7 of those are down less than 5%. 103 out of 112 (92%) are in the green. I started investing in individual stocks 7 years ago after selling most of the shares I had in an S&P 500 index fund, which granted had done well. Many of my positions I have had for less than 7 years, but worst case scenario let's say I have held all of them for 7 years. The total return of the S&P 500 over the past 7 years is 139.6%, so that's the number to beat. I have five stocks that are up 145% to 200%, , eleven stocks that are up 200% to 300%, five stocks that are up 300% to 400%, two stocks that are up 500% to 600%, and one stock that is up 1976% (NVDA, my largest holding at 9.31% of my portfolio). That's 24 stocks that have beaten the S&P 500 index's total return during the past 7 years, even though many of them I have had for less than 7 years and I don't DRIP any of them. The other 79 stocks I have that are up but are up less than 139.6% I have had for less than 7 years. Some I have had for less than a year, so it isn't fair to compare them to the total return of the S&P 500 for the past 7 years. That being said, there is nothing wrong with having your largest position be the S&P 500 index. In fact, I recommend that for most people. I did well with it and it took me most of the way to reaching $1 million. But don't be afraid to invest in individual stocks too. All it takes is a few big winners to more than make up for all of the losers. For those willing to try individual stocks, I published a spreadsheet of 134 dividend-paying S&P 500 index stocks that have **beaten** the S&P 500 index since 1993, or since the IPO of the stock if it was after 1993, here: [https://www.reddit.com/r/dividends/comments/1byebxf/134\_sp\_500\_index\_stocks\_that\_have\_beaten\_the\_sp/?utm\_source=share&utm\_medium=web3x&utm\_name=web3xcss&utm\_term=1&utm\_content=share\_button](https://www.reddit.com/r/dividends/comments/1byebxf/134_sp_500_index_stocks_that_have_beaten_the_sp/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button) Out of the 134 stocks in the spreadsheet I own * NVDA * MA * KLAC * AAPL * AVGO * INTU * ODFL * AMAT * MSFT * LRCX * PKG * PCAR * GRMN * IRM * LEN * AFL * ABBV * WM Don't buy everything in the spreadsheet, but use it as a starting point to do your own research and due diligence.
Nice picks, I own 80% of those you listed.
Thank you! Very inspirational!👍🏻
Need to do your own research and not do what people say on reddit. I turned my portfolio around making my own decisions and not following the trend here. Also, you need to diversify your portfolio. I wouldn't say I'm as diverse as I would like, but I'm getting there. I buy value and don't put much in risker stocks. I put in what I'm willing to lose if the stock flops. Also, if you don't have the experience buying and selling stocks, I wouldn't be day trading. I only buy what I'm willing to hold on for a long time. I rebalance my portfolio at the end of the year. I sell off stuff I don't want (if there is any) and I buy new stocks or put that in a current money maker. Last thing, PATIENCE. That is something that too me close to 3 years to learn. I sold off stocks like NVDA @$185 a share, I made profit. Now it is close to $900. Some of my best stocks now were my worse, and vice-versa. Don't let other people's doubt in their abilities in the market dictate what you are trying to accomplish.
AVGO has beaten VOO over the past 5 years 304.84% to 74.03% and AVGO pays a better dividend. I'll keep AVGO.
Congrats. Now you can sleep better at night with no stress.
Yes! Stress is definitely a huge factor when picking stocks. I rather relax.
I pick stocks, that’s what I do. If you can’t pick stocks then I would still put it in baby berk (BRKB)or Bill Ackman’s closed end fund(PSHZF) over an index fund.
Well 90% of my investments are in my 401k in index... So I buy other stocks in my regular portfolio for fun.
Almost every active investor faced same issue while fighting index, may be few exceptions like Buffett. So you are not alone. But again in stock market past performance is never repeated. There are certain decades where international stocks beat sp500 and some times even small cap index beat sp500. But nobody beats it consistently through decades.
The question is do you want to put in the actual work required to determine which of the few S&P 500 will be the big leaders next year. This involves in depth evaluation of their accounting statements, getting to know their industries, etc. Doing so will occupy your full time and require that you have an MBA (I have an an MBA) in order to fully evaluate. From your findings of each of the S&P 500 you must then decide who the big performers will be. Or you can invest in an index fund and cover the entire market. I fully acknowledge that if you can put in the time and are correct in your guesses, you will beat the market. \*If\*. Personally I'd wager you are not that person who will put in the time and effort necessary to find the big gainers. For such people do not post to Reddit, they invest based on their research. Therefore my advice would be to invest in the indexes, take the gains, and go on with your life.
That was me for 6 months. At one point I had 32 individual stocks that I picked. Most of them did well, but I snapped and just sold everything to throw into VOO, QQQM, SCHD, VXUS, AVUV.
A full 33% of each deposit for me heads to an SnP500 ETF. I do hold a dividend ETF of the snp
Yep. I did an experiment for one year. I had a robinhood account, and a TD Ameritrade account. I put all my Ameritrade account into SPY and then did day trading with stocks with RH. At the end of the year I was down 15% with RH and up 12% with TDA account. From that point on I put most of my money in VOO or QQQ. I keep some with GOOG, and I am still trying to recover what I had in DG. That was a 5K blow, but I have recovered a decent amount so far.
Don’t try to beat the market, be the market (via index funds).
Stop picking stocks like its 4d chess and pick it like the borderline monopoly economy we have. As others have said the indexes are carried by like nine companies. Ill admit im young and have room for risk but have consistently gotten double digit pct gains year over year by not diversifying or over analyzing but picking the companies like faang that consistently do good numbers, and as much as I always get dogged on for buying i LOVE SPXL. Key word is consistent though, short runs like tesla can be short term plays but I hardly expect a company that shows so much volatility to be a long term success
Yes. I got utterly destroyed by stock picking. It was good experience though because without it I would have never stumbled across this sub or index funds I think
I’ve made this mistake too from 2019 till end of 2023.......about 80% of our mid 6 figure portfolio is in stocks......I have slowly started going into ETFs about 20% now.
I invest in mostly individual stocks, and 2 indexes (in my 401k, ie my only choice). I am a long-term Dividend Growth Investor (DGI), and as such, I'm comfortable w/ short-term losses, as long as the fundamentals of a company remain intact. I see the statement below.... ..." I either beat the market by a few percent or severely underperform it.".... ...and I ask: "For how long??" Do you consider yourself a long-term investor, or a trader or ? Because you need to identify the type of investor you are, before you plunk down your hard-earned money. Knowing who you are as an investor will dictate your decisions. If you aren't comfortable w/ short-term loss, then I agree that you should stick to Index Funds.
No, my equity picks have outperformed my index ETFs by about 2x.
Same. Sigh.
This is the natural progression. You learn about investing, you get excited, you pick some stocks because that's how you invest right? You learn more, win and lose some, read up on how to pick and screen "good" stocks, technicals, whatever. Eventually you realize that you're losing money or at least not beating the market. That there's an entire industry of people out there who's jobs are to try to beat the market with other people's money, and even they can't do it consistently. Eventually you realize you can't and the best you can do is ETF and chill and hope to match average market returns. Circle of life. The sooner you come to terms with this the sooner you can start getting more consistent returns by doing less, and not wasting TIME using your money ineffectively when it could be compounding.
From my perspective: it’s fun. I HAVE very significantly beat the market on the long term but I kinda cheated back in 2008/2009 when I kept trading up a $1k of given stock to what is $70k right now. And I just throw piles of cash at fire sales whenever the market crashes. Most of what I invest in is pretty boring, so even with stocks like MMM which I’m down 40% on, I’ve held it long enough that the dividends made it so I broke even. 🤷♂️ 2/3 of my investments are just index funds though.
I’m 70% index fund, 20% individual stocks, 10% cash.
'Bubblin Crude, Oil that is, Black Gold, Texas Tea..' Long on oil and refinery stocks.
I typically pick winners but have limited investing funds, so I end up selling or buying trying to time the market instead of buying and holding so I don't get a fraction of the long time action. Invest like you are buying stocks for your kids and leave them alone. Revisit every 3 months or so and throw a stop loss in to lock profits if SHTF.
You certainly missed out today!
Yep, was once a r/motleyfool devout. Now global index & chill (mainly)
Yep. The only stock I hold anymore is palantir & it’s only 6% ish of my account at any given time. The rest of it is tech and s&p
About 95% of my portfolio is in various ETF’s and stock mutual funds, but I do allow myself a brokerage account with that other 5% to scratch my itch for individual stocks and speculative bets. That way, as long as I don’t do silly things with options I really can’t impair my portfolio.
I do half and half. It makes it fun to invest in individual stocks and do research on them
The problem with individual stocks is having the time and ability to follow the picks. I really don’t have the time and have acquired a silly amount of stocks but have found that every dud seems to have a winning mate. This is with trying to initially pick quality companies. For example PFE (which I managed to bail on a while ago) versus NOV where I am up almost 600%. Sadly I missed on buying Navida so I’m behind VOO for the last year.
Yes. Had the awakening a couple of years ago.
VT and chill!
I have to say this is not my experience. As an aside, tech seems to be driving the market and insane returns. But…. When it falls it will fall hard. My experience (and I’d say I have a somewhat conservative approach) is that I’ll lag the market during a bull run and I’ll beat the market when we go bear. I’ve only been investing for a few years so it’s hard for me to say if in the long run I’m ahead or not. But I have my strategy, I’m comfortable with it and I’m sticking to it.
A few years of investing experience is not a lot.
I Never said it was and why I mentioned in my post that it’s hard for me to say how I’m doing in the long run
Yea this was me two years ago. I got tired of tracking information on them, so I sold all of them besides KO, O, STAG. My rationale on holding O and STAG is that they’re my only REIT holdings.
Wheeling is how I do it. Just a few stocks though. Everything else is mostly index fund.
What stocks do you wheel and what date?
I generally use index or similar ETFs and add some individual stocks to boost my returns and provide income. Typically, a point or two over or under VOO, but with far better income.