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The advice I got regarding stock market from a pro was to invest long term in the 3 indexes: "spiders" (S&P 500), "cubes" (Nasdaq 100) and "diamonds" (Dow Jones

by fduran 14y ago

The advice I got regarding stock market from a pro was to invest long term in the 3 indexes: "spiders" (S&P 500), "cubes" (Nasdaq 100) and "diamonds" (Dow Jones Industrial Average), seems solid, outperforming funds and without management fees.

jvm 14y ago
DJIA and S&P500 are highly correlated (intentionally so), also I'd recommend diversifying internationally.
artsrc 14y ago
If the market is efficient, then the correct investment is market weighted. You are missing the rest of the world and smaller stocks. This implies that you are missing some diversification that would reduce your risk.
- saryant 14y ago
  That's why I follow the basic three-fund portfolio advocated by contemporaries of John Bogle, founder of Vanguard: VTSMX, total US stock market, VTIAX, total international stock market and VBTLX, total bond market index. Three basic index funds each with very, very low fees compared to actively-managed funds. I'm at 60/30/10% respectively in those funds.
  - Evbn 14y ago
    Or roll them into an auto adjusting target retirement 20XX fund
    - saryant 14y ago
      I would if my 401k included one that wasn't terrible. I do use one of those funds for my Roth IRA though, I just wanted to limit my post to the principle, not the implementation.
larrydag 14y ago
Even simpler. Couch Potato Investing. http://assetbuilder.com/couch_potato/couch_potato_cookbook http://assetbuilder.com/couch_potato/couch_potato_cookbook