Buy and Hold Investing - market going down now - who cares - not me
August 4th, 2024 at 5:14:35 AM
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I've been a buy and hold investor in index funds - the S&P and one tech index fund - for a very , very long time
it's not a sexy strategy, too boring for many - but fine for me
I'm now living off of savings and investments
I pay no or almost no capital gains taxes unless I sell which I almost never do
there's no buy anymore in my buy and hold strategy - it's all hold
the long term return is estimated at 10% per year - somewhat higher for the tech index fund - that won't impress anyone but -
I've bought and held these positions for decades - the heights to which they have soared is astonishing to me when I consider how comparatively little I have bought into them
the market has been going down now for a week or so
I could care less - I've been thru this dozens of times - there are no guarantees but so far it always comes back - the only thing that differs from drop to the next is how long it will take to recover
that's my story and I'm sticking to it
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I've been a buy and hold investor in index funds - the S&P and one tech index fund - for a very , very long time
it's not a sexy strategy, too boring for many - but fine for me
I'm now living off of savings and investments
I pay no or almost no capital gains taxes unless I sell which I almost never do
there's no buy anymore in my buy and hold strategy - it's all hold
the long term return is estimated at 10% per year - somewhat higher for the tech index fund - that won't impress anyone but -
I've bought and held these positions for decades - the heights to which they have soared is astonishing to me when I consider how comparatively little I have bought into them
the market has been going down now for a week or so
I could care less - I've been thru this dozens of times - there are no guarantees but so far it always comes back - the only thing that differs from drop to the next is how long it will take to recover
that's my story and I'm sticking to it
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the foolish sayings of a rich man often pass for words of wisdom by the fools around him
August 4th, 2024 at 5:32:28 AM
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Quote: lilredrooster.
I've been a buy and hold investor in index funds - the S&P and one tech index fund - for a very , very long time
it's not a sexy strategy, too boring for many - but fine for me
I'm now living off of savings and investments
I pay no or almost no capital gains taxes unless I sell which I almost never do
there's no buy anymore in my buy and hold strategy - it's all hold
the long term return is estimated at 10% per year - somewhat higher for the tech index fund - that won't impress anyone but -
I've bought and held these positions for decades - the heights to which they have soared is astonishing to me when I consider how comparatively little I have bought into them
the market has been going down now for a week or so
I could care less - I've been thru this dozens of times - there are no guarantees but so far it always comes back - the only thing that differs from drop to the next is how long it will take to recover
that's my story and I'm sticking to it
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link to original post
Just curious, I am starting to plan my retirement and wondering where your income comes from if you are not selling anything? Dividends?
At my age, a "Life In Prison" sentence is not much of a deterrent.
August 4th, 2024 at 5:45:35 AM
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Quote: DRich
Just curious, I am starting to plan my retirement and wondering where your income comes from if you are not selling anything? Dividends?
link to original post
I forgot to mention s.s.
and years ago after the market had a very big year I made a large drawdown and was able to get comparatively high interest on a common bank account - that is what I live off of that my s.s. does not cover
so, I guess it's not 100% accurate to say it's been only buy and hold - I did make one large sale after retiring -
but the amount of that sale was made in the very next year - it only took one year to get back to where I was before the sale
as for dividends, I do have a small % in bond funds - for safety in case of a very large market drop - but I reinvest the dividends - they are not paid out to me directly
dividends from the stock funds are smallish - they are also reinvested
good luck with your retirement planning
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the foolish sayings of a rich man often pass for words of wisdom by the fools around him
August 5th, 2024 at 2:21:41 AM
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you should be getting about 2% per year from your stocks from dividends. I see you have them re-invested
somebody said there really is a golden goose: quarterly dividends
this is true in more than one way, the dividends are just as sweet as having something lay golden eggs. And it is so easy to kill that golden goose by selling off those stocks ... yet most retirees really can't live off the dividends, so we find ourselves in fact at least slowly killing off our magic egg layer
sounds like you aren't one of those, Rooster, good for you. You might check into getting those dividends in cash if you're retired, though. Mighty sweet
somebody said there really is a golden goose: quarterly dividends
this is true in more than one way, the dividends are just as sweet as having something lay golden eggs. And it is so easy to kill that golden goose by selling off those stocks ... yet most retirees really can't live off the dividends, so we find ourselves in fact at least slowly killing off our magic egg layer
sounds like you aren't one of those, Rooster, good for you. You might check into getting those dividends in cash if you're retired, though. Mighty sweet
the next time Dame Fortune toys with your heart, your soul and your wallet, raise your glass and praise her thus: “Thanks for nothing, you cold-hearted, evil, damnable, nefarious, low-life, malicious monster from Hell!” She is, after all, stone deaf. ... Arnold Snyder
August 5th, 2024 at 4:10:36 AM
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A buy and hold in something like AAPL, which I have held continuously for pushing twenty years now, blows away something like this. It didn't take any kind of genius to buy and hold stocks like MSFT, AAPL, AMZN, NFLX, GOOGL, CMG, TSLA, and others, but to not take advantage of those and instead plow it into the S&P 500 would take something other than genius.
What "they" want you to think is that buying a fund is better than buying individual stocks, but that's not true at all. You may create your own blend.
However, at least he did hold. Many bot into the sexy stocks and sold before the real miracles happened, or even lost money dumping in 2008.
What "they" want you to think is that buying a fund is better than buying individual stocks, but that's not true at all. You may create your own blend.
However, at least he did hold. Many bot into the sexy stocks and sold before the real miracles happened, or even lost money dumping in 2008.
I tell you it’s wonderful to be here, man. I don’t give a damn who wins or loses. It’s just wonderful to be here with you people.
https://wizardofvegas.com/forum/gambling/betting-systems/33908-the-adventures-of-mdawg/
August 5th, 2024 at 4:26:18 AM
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89% of fund managers fail to beat the market meaning the S&P 500 - see link
these are professional money managers who failed - they "created their own blend"
from the link - "78-97% of actively managed stock funds failed to beat the indexes they were benchmarked against over ten years"
so my investment in the S&P 500 beat 89% of professional money managers
not trying to say it's anything approaching genius but this was my logic
surely there are some few who beat the s&p by a large margin
I didn't want to spend the time and effort to do that and didn't have the confidence that I could do that
and so very many who tried that did not succeed
maybe I could have done it if I had been less risk averse
but I really don't care - I have way, way more than enough due to my decades long strategy - and I don't have an appetite for luxury items
https://stockanalysis.com/article/can-you-beat-the-market/
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89% of fund managers fail to beat the market meaning the S&P 500 - see link
these are professional money managers who failed - they "created their own blend"
from the link - "78-97% of actively managed stock funds failed to beat the indexes they were benchmarked against over ten years"
so my investment in the S&P 500 beat 89% of professional money managers
not trying to say it's anything approaching genius but this was my logic
surely there are some few who beat the s&p by a large margin
I didn't want to spend the time and effort to do that and didn't have the confidence that I could do that
and so very many who tried that did not succeed
maybe I could have done it if I had been less risk averse
but I really don't care - I have way, way more than enough due to my decades long strategy - and I don't have an appetite for luxury items
https://stockanalysis.com/article/can-you-beat-the-market/
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the foolish sayings of a rich man often pass for words of wisdom by the fools around him
August 5th, 2024 at 4:45:56 AM
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When you have BILLIONS of dollars to put somewhere, therein lies the problem - you can't just maneuver in and out on a whim. Plus these stock brokers have an incentive to churn commissions.
An individual investor who didn't take advantage of the great runup in the individual stocks I mentioned, is not someone who should be lauded in any way. If your advice is that someone 20 years old should put all his money into what you did, I would say that is faulty advice, and in any case, this youngest generation is going to laugh at anyone who suggests that they do that, whether it is good advice or not!
On the other hand, buy and hold in general, is solid advice for most, because most traders lose money, especially day traders. The way I do it is to buy and hold and trade additional shares of the same. Best of both.
An individual investor who didn't take advantage of the great runup in the individual stocks I mentioned, is not someone who should be lauded in any way. If your advice is that someone 20 years old should put all his money into what you did, I would say that is faulty advice, and in any case, this youngest generation is going to laugh at anyone who suggests that they do that, whether it is good advice or not!
On the other hand, buy and hold in general, is solid advice for most, because most traders lose money, especially day traders. The way I do it is to buy and hold and trade additional shares of the same. Best of both.
I tell you it’s wonderful to be here, man. I don’t give a damn who wins or loses. It’s just wonderful to be here with you people.
https://wizardofvegas.com/forum/gambling/betting-systems/33908-the-adventures-of-mdawg/
August 5th, 2024 at 5:05:21 AM
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your strategy assumes that investors will always be able to identify stocks that are so great they will never tumble to almost nothing
maybe you can, I'm not going to question it, but I believe many will fail trying
and one of the stocks you mentioned - CMG - do you really believe it is impossible for that stock to fall to nothing________?_________that people won't get tired of that food_______?
I used to eat it fairly often - not anymore - I got tired of it
or maybe you will be prescient enough to see the big drops before they happen and get out - IDK
in any case, I don't doubt that you are much more profitable as an investor than I am - but I doubt many others can match you
per the link more than 115 million in the U.S. owned mutual funds in 2023 -
https://www.ici.org/news-release/23-news-mutual-funds#:~:text=The%20survey%20also%20found%20that,owned%20mutual%20funds%20in%202023.
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your strategy assumes that investors will always be able to identify stocks that are so great they will never tumble to almost nothing
maybe you can, I'm not going to question it, but I believe many will fail trying
and one of the stocks you mentioned - CMG - do you really believe it is impossible for that stock to fall to nothing________?_________that people won't get tired of that food_______?
I used to eat it fairly often - not anymore - I got tired of it
or maybe you will be prescient enough to see the big drops before they happen and get out - IDK
in any case, I don't doubt that you are much more profitable as an investor than I am - but I doubt many others can match you
per the link more than 115 million in the U.S. owned mutual funds in 2023 -
https://www.ici.org/news-release/23-news-mutual-funds#:~:text=The%20survey%20also%20found%20that,owned%20mutual%20funds%20in%202023.
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Last edited by: lilredrooster on Aug 5, 2024
the foolish sayings of a rich man often pass for words of wisdom by the fools around him
August 5th, 2024 at 5:27:36 AM
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Quote: MDawgWhen you have BILLIONS of dollars to put somewhere, therein lies the problem - you can't just maneuver in and out on a whim. Plus these stock brokers have an incentive to churn commissions.
link to original post
Just as an example I know a guy who owns a hedge fund that he started initially as a means just to invest his own money after he sold a start up. His biggest investment for the fund was BABA, and towards the end of 2021, he was lamenting to me about how it was down to the 160s or so, and that he was losing a lot of money for himself and his clients. I advised him to just dump and put it all into AMZN, which would have gone down a lot too, but by now would be back up. Well now that BABA stock is and has been stuck in the 70s, probably all his clients are crying and up in arms, but he still has his oceanfront home in FL and fleet of Ferraris.
BABA is not a stock I ever owned a single share of, I never believed in it, always preferred AMZN.
But this guy not only believed in it but rode it all the way down, mostly because he was stuck and didn't know where to put all the money if he did pull out. If you imagine me, as a Mack truck buying a couple million dollars of a stock in a single trade, and needing to pull in and out of a lane, imagine billions of dollars and how hard it is to maneuver. That inability to maneuver easily is part of why fund managers cannot beat the S&P, not just because they are incompetent. Comparing one fund index in a vacuum to another doesn't necessarily present the entire picture as to why one outperforms the other.
I tell you it’s wonderful to be here, man. I don’t give a damn who wins or loses. It’s just wonderful to be here with you people.
https://wizardofvegas.com/forum/gambling/betting-systems/33908-the-adventures-of-mdawg/
September 19th, 2024 at 8:50:49 AM
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Quote: lilredrooster.
your strategy assumes that investors will always be able to identify stocks that are so great they will never tumble to almost nothing
maybe you can, I'm not going to question it, but I believe many will fail trying
and one of the stocks you mentioned - CMG - do you really believe it is impossible for that stock to fall to nothing________?_________that people won't get tired of that food_______?
I used to eat it fairly often - not anymore - I got tired of it
or maybe you will be prescient enough to see the big drops before they happen and get out - IDK
in any case, I don't doubt that you are much more profitable as an investor than I am - but I doubt many others can match you
per the link more than 115 million in the U.S. owned mutual funds in 2023 -
https://www.ici.org/news-release/23-news-mutual-funds#:~:text=The%20survey%20also%20found%20that,owned%20mutual%20funds%20in%202023.
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link to original post
I don't understand this thinking at all. Any stock can go broke- look at the retail giants from the 1960s- JC Penny, Sears, Woolworths, etc, but they don't instantly implode and you have a giant parachute that lets you escape anytime you want. You aren't marrying the stock, you are taking it for a ride and can bail as soon as it gets ugly.
You can put in stop losses so if the stock loses X% of its value, it gets sold.
The difference between fiction and reality is that fiction is supposed to make sense.
September 19th, 2024 at 9:13:21 AM
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Quote: billryanI don't understand this thinking at all.
I really could care less what you don't understand re my ideas and my strategy
we've already been over this ad nauseam in your thread entitled "I Love Dividend Stocks" - see link
I get the picture
you LOVE dividend stocks
good for you - go for it -
I just don't care anymore
I don't wanna go any further with this discussion
go ahead and get the last word - as you always do - I know that's a favorite thing of yours
have a nice day
https://wizardofvegas.com/forum/off-topic/general/39452-i-love-dividend-stocks/
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Last edited by: lilredrooster on Sep 19, 2024
the foolish sayings of a rich man often pass for words of wisdom by the fools around him
September 19th, 2024 at 12:33:46 PM
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Quote: lilredroosterQuote: billryanI don't understand this thinking at all.
I really could care less what you don't understand re my ideas and my strategy
we've already been over this ad nauseam in your thread entitled "I Love Dividend Stocks" - see link
I get the picture
you LOVE dividend stocks
good for you - go for it -
I just don't care anymore
I don't wanna go any further with this discussion
go ahead and get the last word - as you always do - I know that's a favorite thing of yours
have a nice day
https://wizardofvegas.com/forum/off-topic/general/39452-i-love-dividend-stocks/
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link to original post
I don't know why you're so upset. I'm not knocking your style of investing; I'm\\ simply saying I don't understand it.
Did I knock it? Did I criticize you for doing things your way? Anytime I post about investing or buying something, I'm very clear that it is a way, not the way, not the only way, simply my way. I've never claimed my way is better than yours.
I would hope you are secure enough in your beliefs that someone saying they don't understand them wouldn't set you into a tizzy.
I apologize if my statement upset you. It wasn't my intention.
The difference between fiction and reality is that fiction is supposed to make sense.
September 19th, 2024 at 12:38:42 PM
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By the way, dividend investing is very similar.
AIPI went up a dollar a share yesterday, but I am only concerned with the dividend. The stock can go up or down; I only care about whether the dividend stays or goes up.
AIPI went up a dollar a share yesterday, but I am only concerned with the dividend. The stock can go up or down; I only care about whether the dividend stays or goes up.
The difference between fiction and reality is that fiction is supposed to make sense.
September 19th, 2024 at 1:23:33 PM
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thank you for your apology - it wasn't really necessary - I apologize for being rude
I felt like I completely explained my strategy in your thread - "I Love Dividend Stocks" - see link
I don't have anything to add to that
I thought what I stated was very clear - but maybe not - but I can't make it any more clear
what I already stated there, and here, is the best I can do for an explanation - I can't do better than that
https://wizardofvegas.com/forum/off-topic/general/39452-i-love-dividend-stocks/
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thank you for your apology - it wasn't really necessary - I apologize for being rude
I felt like I completely explained my strategy in your thread - "I Love Dividend Stocks" - see link
I don't have anything to add to that
I thought what I stated was very clear - but maybe not - but I can't make it any more clear
what I already stated there, and here, is the best I can do for an explanation - I can't do better than that
https://wizardofvegas.com/forum/off-topic/general/39452-i-love-dividend-stocks/
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the foolish sayings of a rich man often pass for words of wisdom by the fools around him
September 19th, 2024 at 1:39:15 PM
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I grew up in the buy and hold philosophy and am still guilty of holding many stocks too long. My father was the worst. He would hold stocks for 20 years and ride them all the way to zero. I remember he had a big position in Kresge and rode it down all the way through buying Sears and going to zero.
At my age, a "Life In Prison" sentence is not much of a deterrent.
September 19th, 2024 at 4:16:52 PM
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Quote: DRichI grew up in the buy and hold philosophy and am still guilty of holding many stocks too long. My father was the worst. He would hold stocks for 20 years and ride them all the way to zero. I remember he had a big position in Kresge and rode it down all the way through buying Sears and going to zero.
link to original post
Around 2000, one of my aunts died, and my mom and her sisters each received shares in Lucent worth over $100,000. All of them held on to them as they sunk into near worthlessness. Mom didn't trust the stock market. It was strange- my parents bought us stocks as communion presents and encouraged weekly savings, but my parents didn't invest in stocks. My Mom's only shares when she died were Manulife, which had been John Hancock. She was given those when the company went public. The rest of her family bought phone company stocks and little else. Some 3M, while my Uncle worked for them. He thought they would become a huge company.
I was a buy-and-hold guy for years—ATT, Pepsi, US WEst, Motorola, Ericson, Marvel, Disney, Dial, P&G, and the like.
The market has changed over the last decade, and it is not for the better. When CDs drop down below 3%, a lot of new money should enter the market, and most of it will revolve around less than a dozen stocks. Millions of shares per second will be changing hands, driven by AI that knows failure means death.
Last edited by: billryan on Sep 19, 2024
The difference between fiction and reality is that fiction is supposed to make sense.
September 20th, 2024 at 4:21:50 AM
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to show the power of buy and hold with the S&P 500 index fund I will reveal some personal info
I began putting just $2K in my IRA each year at age 25 (just one of my accounts)
I retired at age 61 and stopped contributing - so that's 36 years - only $72K was put in - and it was put in little by little - not all at once
if all of that had been put in at age 25 it would have been way, way more
it's now close to $1 million - just a little shy of it
when I first noticed that, I was shocked at how high the account went - I didn't expect that
could I have done better actively trading________?
maybe - but I also could have done worse
like the song says "no regrets"
this is not intended as a brag
I'm aware that what I quoted is not a great sum of $ anymore
I only posted to show it's growth
I'm not a wealthy person and am not claiming to be one
just very comfortable with no need to earn income any more -
because of buy and hold investing with the S&P 500
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to show the power of buy and hold with the S&P 500 index fund I will reveal some personal info
I began putting just $2K in my IRA each year at age 25 (just one of my accounts)
I retired at age 61 and stopped contributing - so that's 36 years - only $72K was put in - and it was put in little by little - not all at once
if all of that had been put in at age 25 it would have been way, way more
it's now close to $1 million - just a little shy of it
when I first noticed that, I was shocked at how high the account went - I didn't expect that
could I have done better actively trading________?
maybe - but I also could have done worse
like the song says "no regrets"
this is not intended as a brag
I'm aware that what I quoted is not a great sum of $ anymore
I only posted to show it's growth
I'm not a wealthy person and am not claiming to be one
just very comfortable with no need to earn income any more -
because of buy and hold investing with the S&P 500
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Last edited by: lilredrooster on Sep 20, 2024
the foolish sayings of a rich man often pass for words of wisdom by the fools around him
September 20th, 2024 at 7:58:49 AM
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That is precisely how it is supposed to work. You invest small quantities along the way, and after forty years, it adds up so you can live comfortably. The question is- now that you have your million, what do you do with it?
The difference between fiction and reality is that fiction is supposed to make sense.
September 20th, 2024 at 2:45:59 PM
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The stock market (Dow Jones) in October 1965 hit 9,500. It took 30 years to hit that number again Aug 1995. In other words anyone who bought in 1965 would have never seen a profit maybe in their investing lifetime. Timing is everything.
50-50-90 Rule: Anytime you have a 50-50 chance of getting something right, there is a 90% probability you'll get it wrong
September 20th, 2024 at 4:23:04 PM
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Quote: vegasThe stock market (Dow Jones) in October 1965 hit 9,500. It took 30 years to hit that number again Aug 1995. In other words anyone who bought in 1965 would have never seen a profit maybe in their investing lifetime. Timing is everything.
link to original post
You drinking? I think you added a zero to the 1965 number. It was in the 900’s in 1965.
Pretty sure no 30 year period without a reasonable appreciation in stock values.
September 20th, 2024 at 4:32:25 PM
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Quote: vegasThe stock market (Dow Jones) in October 1965 hit 9,500. It took 30 years to hit that number again Aug 1995. In other words anyone who bought in 1965 would have never seen a profit maybe in their investing lifetime. Timing is everything.
link to original post
The stock market broke 1,000 for the first time around 1972, went down and it took a few years to regain that level.
The difference between fiction and reality is that fiction is supposed to make sense.
September 20th, 2024 at 4:34:29 PM
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Quote: vegasThe stock market (Dow Jones) in October 1965 hit 9,500. It took 30 years to hit that number again Aug 1995. In other words anyone who bought in 1965 would have never seen a profit maybe in their investing lifetime. Timing is everything.
link to original post
Even if that were true, and it's not, the person would have thirty years' worth of dividend checks or own many more shares if he reinvested.
The difference between fiction and reality is that fiction is supposed to make sense.
September 20th, 2024 at 7:04:26 PM
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September 20th, 2024 at 7:26:12 PM
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Quote: Calder100 years of the DJIA
90 years of the S&P 500
link to original post
That was the chart I looked at. I guess I read it wrong
50-50-90 Rule: Anytime you have a 50-50 chance of getting something right, there is a 90% probability you'll get it wrong
September 21st, 2024 at 12:59:56 AM
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Quote: vegasQuote: Calder100 years of the DJIA
90 years of the S&P 500
link to original post
That was the chart I looked at. I guess I read it wrong
link to original post
I saw that chart and have no idea what it describes. If you scroll down from it, you can see the actual numbers. The chart is misleading, if not wrong.
The difference between fiction and reality is that fiction is supposed to make sense.
September 21st, 2024 at 3:54:28 AM
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in comparing dividend investing to investing for growth in a non IRA account
this is assuming you don't need the dividends for personal expenses
the dividend creates a taxable event
with growth investing (with often very small and insignificants dividends) there is no taxable event until you sell, except possibly for very smallish dividends
then there is a capital gains tax assuming there are gains
if possible, he can delay selling until after retirement so the tax % is less since he has no income from working, and the person investing for growth in this situation will pay less tax overall
if you need the dividends for personal expenses that is a different story
but the person investing for growth can sell at any time and obtain funds too
and in this situation will also have a capital gains tax obligation assuming there are gains
I can't provide proof of this but I believe in terms of total return growth stocks or funds will generally outperform dividend stocks or funds
also, while the gain of the S&P and DJIA are very impressive, they are considerably less impressive if the true gain is calculated by factoring in inflation - and the constantly shrinking buying power of the dollar
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in comparing dividend investing to investing for growth in a non IRA account
this is assuming you don't need the dividends for personal expenses
the dividend creates a taxable event
with growth investing (with often very small and insignificants dividends) there is no taxable event until you sell, except possibly for very smallish dividends
then there is a capital gains tax assuming there are gains
if possible, he can delay selling until after retirement so the tax % is less since he has no income from working, and the person investing for growth in this situation will pay less tax overall
if you need the dividends for personal expenses that is a different story
but the person investing for growth can sell at any time and obtain funds too
and in this situation will also have a capital gains tax obligation assuming there are gains
I can't provide proof of this but I believe in terms of total return growth stocks or funds will generally outperform dividend stocks or funds
also, while the gain of the S&P and DJIA are very impressive, they are considerably less impressive if the true gain is calculated by factoring in inflation - and the constantly shrinking buying power of the dollar
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Last edited by: lilredrooster on Sep 21, 2024
the foolish sayings of a rich man often pass for words of wisdom by the fools around him
