Too Hot Investment Thread

Max out the 401k.
It's all pre tax dollars and the tax savings alone is a great ROI!

 

I've got half a bitcoin that I purchased back in April 2020. I'm paying a guy commission to watch over it and grow it for me.

 

That some nice returns right there.

 

I know people who have done that. Big money guys do it all the time they leverage their assets.

 

This is a topic that is very interesting to me. I have only read about 40% of the thread so I may repeat some observations.

Like the OP, the overwhelming majority (98-99%) of my investments are done by professionals. My general philosophy is dollar cost averaging whether weekly (retirement account), or periodically, in the after tax account.

However, for purposes of this thread, that is no fun. Due to more time and a distaste for the news, I find myself tuned into CNBC, Fox Business and Bloomberg more and more. I helped my son and brother with their fun accounts but I am about to start my own. I call it my "swing for the fences" fund.

The direction I am going is industries such as electric vehicles, marijuana, clean energy, online gambling, precious metals and crypto currency. This has been confirmed by the chief investment officer of a national firm, someone whose previous job was to manage the investment portfolio of a Forbes 400 member (highly famous family) and is a current contributor on a national cable business network. He is for real but I am not comfortable revealing names. I also subscribe to a national newsletter from a guy in my hometown who gives perspectives from a trader which mainly gauges sentiment. PM me if you are interested in the newsletter which is about $750 a year.

I am waiting on a pullback, knowing market timing generally does not work, but I will reveal some picks once the fund is started.

 

so does he water it and take it our for walks?

 

While I don't want to rain on anybodys parade, while I don't exactly follow Boglehead principles to the letter, I do subscribe to those principles. They are

- you can't on average beat the market. If you do, it is likely luck. While you can argue whether the market is "efficient" or not, depending on how you define efficient, you really don't have any better information than anybody else. On Wall Street they have the best and brightest minds, Harvard and MIT physics whizes doing Quant models (which is a horrible waste of talent, but that's another story). If you think you can beat them you will likely be disappointed.

- Being in only a few stocks gives you much less diversification impact than an index mutual fund or ETF.

- there are going to be many stories, some seen here, of picked stocks doing great. There are just as many stories, typically not shared, of stocks that don't.

- statistically gains in the markets are from a small percent of stocks. Most stocks underperform the index, and many lose money or go to zero. Thus odds are most individuals who own individual stocks probably underperform the market.

Stock market gains come from few top performers

- while advisors can add value, they come at a cost. They often charge commissions or an AUM, and are more likely to invest in active funds or individual stocks. There is zero evidence that on average they have superior returns vs the market. A 2% expense ratio would cost you roughly 2/3 of your portfolio.value over 50 years.

- most investors would be better off in index fund based target date funds

- index funds consistently beat actively managed funds. In any year they almost always beat a lot more than half. Over ten-twenty years they beat around 90%

- this is intuitive because index fund follow the market. Their returns follow the average of all active participants. Better than 50, worse than 50. But active traders have expenses. Commissions, loads, fund expenses etc. Index funds have almost none of those. Thus index funds outperform.

Best things to do are
- save as much as you can
- contribute to 401ks, IRAS and Roths and HSAs as much as possible.
- figure out an asset allocation you can stick with. Targrt date funds do this for you.
- use index funds and/or target date index funds
- stick with it. Don't buy and sell based on how you feel about the market. Most people who do this buy high and sell low.

Advisors are fine, but you don't need an advisor to do that. But you do have to have the ability to stick with it. Most don't.

 

lol. That's awesome.

No, he essentially trades it and grows it without me having to invest any further capital.

 

So managing the value of the bitcoin rather than the actual bitcoin.

 

Thx. I'll add some of this to my process. I'm a fan of penny stocks - keep a spreadsheet that is filled with more "what to watch" than what I own. I look for patterns in what I initially think is good and how it plays out. Copious notes. Try to see where there's intuition and where there isn't...

 

How is he doing at it? Half of the battle is outpacing fees.

 

Not bad I suppose but definitely better than I would. He hasn't lost any ground but its slow moving. we went from .47 of a bitcoin to .53 and that was back in December. He should be sending me a report in the next couple of weeks.

 

basically yeah.

 

Which app?

I've considered buy for years but never looked into how to do it.

 

I've done that with some small biotech (under $3) watch the charts they often cycle through 20-50%(or more) swings with some rhythm. Just can't be greedy get your gain and get out.

A few I've done well with over the years.
BDSI
AGEN
VGTN