7 ms·
TSLA has a forward PE of ~200x. That is probably the most logical comparison with SpaceX. Proof that the market can stay irrational for quite a long time. It
by rootusrootus 4mo ago
TSLA has a forward PE of ~200x. That is probably the most logical comparison with SpaceX. Proof that the market can stay irrational for quite a long time.
It fills me with a bit of dread about the future of the market. I am 10 years out from retirement, have a bit over 1M sitting in that market, and I wonder if it will implode in the meantime. I am fairly committed to the "invest like a dead man" (i.e. index funds, no touch), but the world we live in today makes me have real doubts that the next few decades will look anything like the last few.
- tony69 4mo agoPlenty of hedged equity funds out there. Trade some performance for peace of mind.
- throwaway2037 4mo agoWhat is a "hedged equity fund"? Can you provide an example?
- Waterluvian 4mo agoAbout 10 years out as well. I’ve concluded I just invest a very balanced set of index funds and bonds and GICs across a handful of institutions, and then invest in my home because even if the housing market collapses I get to enjoy my nice home. Other than that I’m just not over investing for retirement and instead making sure the money is spent today on family growth and experience. I eventually just got tired of everyone with an opinion on what doing it right looks like or how to predict the market.
- zuzululu 4mo agowould you invest in vending machines
- davedx 4mo agoEh, Tesla had a relatively normal growth company valuation for a while when they were growing strongly. The problem is the stock still hasn't compressed the multiple back down as growth stagnated... because the market swapped out "valuation based growth" for "call option on robotaxi success" at the blink of an eye.
- WarmWash 4mo agoRobotaxi failed so now it's Optimus bots.
- maxlin 4mo agoFailed? When? It's not doing too bad last I checked. While the competition flounders. Robotaxi is the next great growth thing. After that, it's Optimus.
- sroussey 4mo agoThe truly terrifying thing is that someone could short the Musk companies, and with one bullet can cause them to drop 50-90% right away (thanks to meme-ness). And they are valued so high that such a person could make billions overnight, maybe 10s of billions. Terrifying to be Must or anyone that shares a car or plane with him.
- simondotau 4mo agoAdd that to the litany of reasons why shorting should be illegal. There is some value to shorting, but it doesn't justify the consequences.
- gowld 4mo agoAnd also, longs? The war in Iran has actually killed thousands of people, for market-manipulation purposes.
- davedx 4mo agoStart gradually converting your equity to bonds is the standard advice on that timeframe. If you're dreading equity drawdowns, that's what fixed income is for.
- solenoid0937 4mo agoThis is absolutely terrible advice and is out of touch with modern financial understanding. Bonds feel psychologically safer, but lead to failure more often than total market equity portfolios, even when you account for market crashes. https://youtu.be/p25PPBgMiEk https://youtu.be/p25PPBgMiEk
- senordevnyc 4mo agoI always thought the psychological safety was exactly part of the point, since 100% equity portfolios do better in theory than practice, because people are more likely to panic sell.
- deleted 4mo ago[deleted]
- GoatOfAplomb 4mo agoI agree with everything in the video you linked (which is not surprising, given it's Ben Felix). That includes the parts about equities being less risky than bonds in very important ways, but also the parts about behavioral loss tolerance and risk capacity, and how they can indicate higher bond allocation. So I disagree that "If you're dreading equity drawdowns, that's what fixed income is for" is absolutely terrible advice.
- rootusrootus 4mo agoI feel like I should go learn some more. I'm not in a pure index fund, I'm really in VFORX (almost completely, I'm not too original nor sophisticated financially and don't try to pick my own stock picks these days except with my "lunch money" just for fun). Do you think something like VFORX is a bad option? It's actively managed, so the fees will be a little higher than a pure index fund, but it's Vanguard and the fees are still really low. And it has total market components in addition to bonds.
- gordon_freeman 4mo agoIn a similar situation: I basically have just 2 funds in my retirement portfolio: SnP500 index fund (75%) AND Berkshire Hathaway B shares (25%) from my research I know that in years where SnP500 drops too much (recessionary periods), BRK-B would soften the blow as Value stocks tend to do well in such times. And usually that works for me.
- toomuchtodo 4mo agoWhat about swapping the SP500 for VT (total world equities)?
- throwaway2037 4mo agoFor those unaware (myself included), VT is the Vanguard Total World Stock Index Fund ETF which "tracks the FTSE Global All Cap Index, covering roughly 9,000 stocks across more than 40 developed and emerging markets." I see this argument a lot online: "You need more diversity." First, you didn't provide any reason or evidence about why this is a good idea. Second, "more diversity" isn't always better. The S&P 500 has crushed VT since inception (June 2008). Most people will be surprised to learn that adding smaller cap (domestic) stocks, or international developed country stocks, or emerging market stocks will probably reduce your returns. As an example, you can compare the returns of S&P 500 vs Russell 2000 since 2005 [1]. It is not even close -- S&P 500 crushes again. Also, the vol in S&P 500 was lower than Russell 2000. My investment philosophy comes directly from Warren Buffett: "Never bet against America". Of the three largest economic zones in the world with free markets (United States, Europe, and Japan), the United States is by far the most dynamic. Ask yourself: In the next 30 years (or more), which of those three regions will grow the most? In my view: Absolutely the United States. Finally, to people who say that you need international stocks in your portfolio else you are "missing out". You don't. Why? The S&P 500 already has 30% of revenues from countries outside the United States. [2] [1] https://curvo.eu/backtest/en/compare-indexes/russell-2000-vs-sp-500?currency=usd https://curvo.eu/backtest/en/compare-indexes/russell-2000-vs... [2] https://www.spglobal.com/spdji/en/documents/research/research-the-impact-of-the-global-economy-on-the-sp-500.pdf https://www.spglobal.com/spdji/en/documents/research/researc...
- runako 4mo agoPE of 380 against deteriorating margins & profit. This story doesn't end well. But to your point, it's likely a cult of personality that can stay upright until Musk leaves the company.
- simonebrunozzi 4mo agoWatch a lot of Ben Felix. Tons of good advice for you.
- omgwtfbyobbq 4mo agoPE isn't a great way to value a company in their growth phase. Amazon's PE in 2013 was 3000+, but you'd still be up almost 20x if you purchased their stock back then. https://www.theglobeandmail.com/investing/markets/markets-news/Motley%20Fool/30254229/is-amazon-a-buy-sell-or-hold-in-2025/ https://www.theglobeandmail.com/investing/markets/markets-ne... That doesn't mean Tesla or SpaceX are good buys though. Maybe they are, maybe they aren't.
- throwawaycan 4mo agoBus Tesla isn’t in anything looking like a growth phase
- thelastgallon 4mo ago2024 total deliveries: 1,789,226 2025 total deliveries: 1,636,129 8% decline YOY, Tesla shut down production of Model S & X. Eventually, they will become a pure speculation as a service stock, with zero production. But its cheaper to produce than bitcoin, no energy needs to be expended, runs on pure Musk energy!
- maxlin 4mo agoThey shut down production of S & X to make more capability for cars that they want to focus on and which sell way more, AND Cybercab. Tesla grows in large steps. Next big step is Robotaxis, which is well on its way. After that, robots, for which they have the best real-world AI platform for. You could say Tesla is a speculation stock as well when they had released the Roadster. Tesla shorters always lose.
- rootusrootus 4mo ago> Tesla shorters always lose Isn't that true more often than not no matter what company you try to short? It's a tough game to play.
- throwaway2037 4mo ago
- holoduke 4mo agoInflation is covering all the inflated valuations eventually.
- mystraline 4mo agoWe've been diversifying with physical metals. Stocks, bonds, etc are effectively NFTs of "you own a monkey image". That monkey image can go poof on a 'market correction' aka 95% of investors lose everything. With precious metals, you own the material. And silver, gold, platinum, palladium, rhodium and others have innate usage for a variety of industrial and jewelery uses. Their prices may change, but catalytics arent just going to bottom out. We still have stocks, cause 401k's. But we also have a sizable metal buffer now.
- gowld 4mo ago"Stocks, bonds, etc" are nearly the entirely of the real economy. 95% of the value of gold is "you own a monkey image". The value of gold for catalytics is tiny. If gold wasn't used as a reserve currency for the world economy, it would be extremely cheap for industrial and jewelery uses.