4 ms·

> Buy a stock so that you keep holding it for 10 years is good advice Not really. Individual stocks are too risky for casual investors. Buy and hold the entir

by thunky 4y ago

> Buy a stock so that you keep holding it for 10 years is good advice Not really. Individual stocks are too risky for casual investors. Buy and hold the entire market instead.

andsoitis 4y ago
Or even just the top 500. Now if only there was an easy and convenient neat to do that…
- pooper 4y ago
  I have close to zero financial knowledge but even I r managed to fund a Vanguard Roth IRA in my name. If I can do it, anyone can do it. It isn't ideal. It is 100% VTSAX. But I did it. All on my own. No need to worry about a target date or anything like that.
  - andsoitis 4y ago
    Yes. I was being tongue in cheek.
Mistletoe 4y ago
That’s my major beef with this guy’s article. It has been shown repeatedly that picking stocks does not work. https://www.cnbc.com/amp/2020/09/18/stock-picking-has-a-terrible-track-record-and-its-getting-worse.html https://www.cnbc.com/amp/2020/09/18/stock-picking-has-a-terr... Choosing Airbnb or Google or whatever because you think you know something about it or can predict the future is setting yourself up for failure. Yahoo seemed like a great stock at one time. The market changed, the leadership was faulty etc. >The top five stocks in 2000 were Microsoft, Cisco (CSCO), Exxon Mobil (XOM), GE (GE), and Intel (INTC); they represented 18% of the index. Five years later, Goldman pointed out, they represented just 12% of the index’s market capitalization. And 20 years later, they represent 8%.
- motoxpro 4y ago
  From the article. "To be perfectly clear, I am not recommending Airbnb or Google stock here. I like both companies very much and think they are dominant in their sectors (travel and search) and likely will continue that dominance for the foreseeable future. But all businesses are at risk of poor management, new competitors, changing market structures and technologies, and many other things. Return comes with risks. Buildings can be risky too. Neighborhoods can change. Tax and other laws can change."
  - Mistletoe 4y ago
    Fair enough but his analogy to buying buildings doesn’t make sense then. An index of stocks would be more like buying REITs which by the way have underperformed stocks in the last 5 and 10 years. https://www.fool.com/research/reits-vs-stocks/ https://www.fool.com/research/reits-vs-stocks/
    - motoxpro 4y ago
      Huh? That's not the point of the article at all? He is talking about holding periods and cap rate, not SPY vs a REIT.

by thunky 4y ago

> Buy a stock so that you keep holding it for 10 years is good advice Not really. Individual stocks are too risky for casual investors. Buy and hold the entire market instead.

andsoitis 4y ago

Or even just the top 500. Now if only there was an easy and convenient neat to do that…

pooper 4y ago
I have close to zero financial knowledge but even I r managed to fund a Vanguard Roth IRA in my name. If I can do it, anyone can do it. It isn't ideal. It is 100% VTSAX. But I did it. All on my own. No need to worry about a target date or anything like that.
- andsoitis 4y ago
  Yes. I was being tongue in cheek.

Mistletoe 4y ago

That’s my major beef with this guy’s article. It has been shown repeatedly that picking stocks does not work. https://www.cnbc.com/amp/2020/09/18/stock-picking-has-a-terrible-track-record-and-its-getting-worse.html https://www.cnbc.com/amp/2020/09/18/stock-picking-has-a-terr... Choosing Airbnb or Google or whatever because you think you know something about it or can predict the future is setting yourself up for failure. Yahoo seemed like a great stock at one time. The market changed, the leadership was faulty etc. >The top five stocks in 2000 were Microsoft, Cisco (CSCO), Exxon Mobil (XOM), GE (GE), and Intel (INTC); they represented 18% of the index. Five years later, Goldman pointed out, they represented just 12% of the index’s market capitalization. And 20 years later, they represent 8%.

motoxpro 4y ago
From the article. "To be perfectly clear, I am not recommending Airbnb or Google stock here. I like both companies very much and think they are dominant in their sectors (travel and search) and likely will continue that dominance for the foreseeable future. But all businesses are at risk of poor management, new competitors, changing market structures and technologies, and many other things. Return comes with risks. Buildings can be risky too. Neighborhoods can change. Tax and other laws can change."
- Mistletoe 4y ago
  Fair enough but his analogy to buying buildings doesn’t make sense then. An index of stocks would be more like buying REITs which by the way have underperformed stocks in the last 5 and 10 years. https://www.fool.com/research/reits-vs-stocks/ https://www.fool.com/research/reits-vs-stocks/
  - motoxpro 4y ago
    Huh? That's not the point of the article at all? He is talking about holding periods and cap rate, not SPY vs a REIT.