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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-pickin
by 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 agoFrom 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 agoFair 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 agoHuh? That's not the point of the article at all? He is talking about holding periods and cap rate, not SPY vs a REIT.