Author Topic: Stocks  (Read 603444 times)

Offline Sowhat

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Re: Stocks
« Reply #3640 on: January 06, 2020, 01:08:13 PM »
the premise for your question is flawed. You are attempting to select a Mutual Fund that has beat the S&P based on previous returns/success. Historically, that is a very weak barometer to use in terms of predicting future returns. In fact success often leads to higher fees, thereby putting you at an even greater disadvantage.

Yes, but all you have are prior returns to compare, for the ETF too.  Are you saying that you disregard all prior returns in selecting your investment?

Offline Sowhat

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Re: Stocks
« Reply #3641 on: January 06, 2020, 01:09:36 PM »
And fees go down at a reputable shop, usually, as AUM grow.

It is hard to discuss with you if you completely dismiss prior returns.

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Re: Stocks
« Reply #3642 on: January 06, 2020, 01:44:42 PM »
It is hard to discuss with you if you completely dismiss prior returns.

What timeframe are you looking at? What's the manager's tenure at the fund?

Past performance might only indicate how a certain manager performed over a certain period. If you have a complete market cycle under the same manager, and no change in the policies and system employed by the manager/fund, then you can give it some credibility, though it will still not indicate anything about the future, as many things can and will change.
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Online dealfinder11

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Re: Stocks
« Reply #3643 on: January 06, 2020, 01:56:33 PM »
What timeframe are you looking at? What's the manager's tenure at the fund?

Past performance might only indicate how a certain manager performed over a certain period. If you have a complete market cycle under the same manager, and no change in the policies and system employed by the manager/fund, then you can give it some credibility, though it will still not indicate anything about the future, as many things can and will change.

+1

And fees go down at a reputable shop, usually, as AUM grow.

It is hard to discuss with you if you completely dismiss prior returns.

this turned up in a simple google search. There is a wealth of info on this topic and am trying to keep as simple as possible.

https://www.marketwatch.com/story/why-way-fewer-actively-managed-funds-beat-the-sp-than-we-thought-2017-04-24

Offline Sowhat

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Re: Stocks
« Reply #3644 on: January 06, 2020, 02:09:53 PM »
What timeframe are you looking at? What's the manager's tenure at the fund?

Past performance might only indicate how a certain manager performed over a certain period. If you have a complete market cycle under the same manager, and no change in the policies and system employed by the manager/fund, then you can give it some credibility, though it will still not indicate anything about the future, as many things can and will change.

Yes, these are all relevant.  It doesn't address my question.

Offline Sowhat

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Re: Stocks
« Reply #3645 on: January 06, 2020, 02:13:58 PM »
+1

this turned up in a simple google search. There is a wealth of info on this topic and am trying to keep as simple as possible.

https://www.marketwatch.com/story/why-way-fewer-actively-managed-funds-beat-the-sp-than-we-thought-2017-04-24

This what led to my question, I guess I was looking at the top 1% of funds.  For example, Fidelity and T Rowe Price have mid-cap funds.  Both funds beat the relevant ETF's over long periods by some 5% or so.  Short term returns were higher.  Can these funds fall off a cliff?  Yes, but that's not the point.

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Re: Stocks
« Reply #3646 on: January 06, 2020, 02:39:53 PM »
Yes, these are all relevant.  It doesn't address my question.

how in the world does that not address your question??

Regardless, the difference isn't going to be that significant, odds are you will underperform, and that is before tax considerations.

I have come to two basic understandings, when it comes to investing in the stock market.

1. Historically, If you are investing long term, the stock market has been a great place to put money and let it compound.

2. Beyond investing in the S&P, you are more likely to make a bad decision than a good one. 

Offline aygart

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Re: Stocks
« Reply #3647 on: January 06, 2020, 02:50:56 PM »

2. Beyond investing in the S&P, you are more likely to make a bad decision than a good one. 

Depending on time frame there may be value in changing the weighting more towards small caps than the S&P.
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Offline ltttc

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Re: Stocks
« Reply #3648 on: January 06, 2020, 03:09:21 PM »

1. Historically, If you are investing long term, the stock market has been a great place to put money and let it compound.

+1  As a general sweeping rule, stocks on average will give you a 10-12% return. If you buy and hold, you stand to gain.

Offline aygart

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Re: Stocks
« Reply #3649 on: January 06, 2020, 03:11:25 PM »
+1  As a general sweeping rule, stocks on average will give you a 10-12% return. If you buy and hold, you stand to gain.
I don't recommend doing that with individual stock unless you are going to be busy researching and rebalancing them.
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Offline ltttc

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Re: Stocks
« Reply #3650 on: January 06, 2020, 03:12:52 PM »
I don't recommend doing that with individual stock unless you are going to be busy researching and rebalancing them.
There's always mutual funds...

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Re: Stocks
« Reply #3651 on: January 06, 2020, 03:13:47 PM »
There's always mutual funds...
That is correct.
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Re: Stocks
« Reply #3652 on: January 06, 2020, 03:20:45 PM »

Offline Sowhat

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Re: Stocks
« Reply #3653 on: January 06, 2020, 08:40:27 PM »
how in the world does that not address your question??

Regardless, the difference isn't going to be that significant, odds are you will underperform, and that is before tax considerations.

I have come to two basic understandings, when it comes to investing in the stock market.

1. Historically, If you are investing long term, the stock market has been a great place to put money and let it compound.

2. Beyond investing in the S&P, you are more likely to make a bad decision than a good one.

To say that future returns are not guaranteed in a fund (why is an ETF different on that?) does not address the underlying issue.  Nothing is guaranteed, anywhere.  You always look back to gauge.  One things is certain--you are not a fan of mutual funds.


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Re: Stocks
« Reply #3654 on: January 06, 2020, 11:24:56 PM »
To say that future returns are not guaranteed in a fund (why is an ETF different on that?) does not address the underlying issue.  Nothing is guaranteed, anywhere.  You always look back to gauge.  One things is certain--you are not a fan of mutual funds.



Look back at what? To borrow an illustration from Jack Bogle. If you put 1012 gorillas in a gym and had all of them flip a coin 10 times, one gorilla will likely get 10 heads in a row. We would call that one lucky gorilla. Wall Street would call him a genius. Please look at all the funds that didn't beat the bench mark, not just the few that have.

Of course i'm against active high fee Mutual Funds. The only ones who like them are Financial Advisors who can charge a 5.75 % load fee + a .50 - 2% AUM fee.

This really isn't rocket science and is the consensus among any educated people in the world of finance. I am really not suggesting anything contrarian or original here.

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Re: Stocks
« Reply #3655 on: January 09, 2020, 05:17:26 PM »
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline mercaz1

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Re: Stocks
« Reply #3656 on: January 09, 2020, 05:44:23 PM »

Online dealfinder11

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Re: Stocks
« Reply #3657 on: January 09, 2020, 11:48:49 PM »
On the topic of index funds:

https://www.bloomberg.com/news/features/2020-01-09/the-hidden-dangers-of-the-great-index-fund-takeover

Interesting read. If fractional shares can be utilized to allow investors to own the index directly (through tools set up by the big brokers) it solves some of the “too much power” problem, however you are still left with the passive “I don’t care” issue. Will be interesting to see what happens.

Offline good sam

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Re: Stocks
« Reply #3658 on: January 13, 2020, 06:19:20 PM »
So when do we sell tsla?
If you don't care why would you comment?
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Offline grodnoking

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Re: Stocks
« Reply #3659 on: January 13, 2020, 06:43:02 PM »
So when do we sell tsla?
I'd wait till after q4 earning report.
I'm not who you think I am.