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Sure, for amateurs like you, it's luck, but not for the few who know what they're doing.
So you grow a third eye and can predict black swan events? Why do you even play the stock market? You should just play the lottery and use your foresight to make millions.
Even warren Buffett says not to try and time the market.
Invest in a mix of VOO and AGG. How much you put in one versus the other depends on your appetite for risk.
I have been investing for 30 years and even I don't kid myself into thinking I know how to pick and choose stocks. Nobody can. Google "efficient market hypothesis" then stick with index funds like AGG and VOO.
So you grow a third eye and can predict black swan events? Why do you even play the stock market? You should just play the lottery and use your foresight to make millions.
Even warren Buffett says not to try and time the market.
No, I don't have a third eye and I can't predict the lottery.
Warren Buffett did okay, but I made over 50% return on my investment this month.
Other than a small IRA I have at my bank, I have pretty much no investing experience with stocks.
I recently sold some assets and have $100k to $150k to invest. I have no idea what to do with it.
I dont really want to tie it up in a retirement account as I like to have access to it if I come across something else to do with it. (investing in my business)
I have heard the fees are lower on Vanguard Funds but thats about the only direction I have looked in to.
Any ideas what I should do with this? (Im 45, self employed)
Ask yourself these questions:
Are you making good money?
Have you paid taxes already on the money?
I'm with you on tying up the money in an investment account. I like to keep it liquid. And keep it working, if you can.
Mutual Funds:
I don't like them for lump sum investments because they will send you an income statement - and therefore a tax bill - every year.
I like ETF's instead. You buy in once. You can sell easily any portion you need and in the meantime you can pick one that pays dividends.
VIG (Vanguard Dividend Appreciation ETF) is one who invests in stocks with appreciating dividends. Depending upon your answers above you may have to pay taxes on your dividends, but you'll have a nest of stocks that are doing well. When you buy, you can direct the brokerage firm to reinvest all dividends, if you like.
You could go directly to Vanguard or buy through a broker. Probably a little easier to sell through a broker.
what about the S&P hitting all time high? I would think this is not a good time to get in? Yes Im a rookie so I have no idea
That's why I always recommend balanced (aka "moderate allocation") funds. They typically own 60%-70% in stocks and the rest in bonds and cash. The bonds and cash cushion the blow in stock market downturns. Of course, balanced funds can and do lose money, and will again at some point in the future, but the losses are less severe, and are therefore easier to take. It's easier to stick with a balanced fund for this reason. And the most important thing about investing is BEING CONSISTENT.
Most people let themselves be run by their emotions. That works against them in investing (and in lots of other things, too). Balanced funds look boring when the stock market is on fire, but they feel a lot better when the inevitable bad year hits. Since they lose less in bad years, they don't need to gain as much in good years to make up their losses.
I recommend a fund like Vanguard Wellington. It has cheap expenses (.18% if you invest 50K or more) and top notch returns without insane volatility. It's been around forever. It invests in investment grade bonds and dividend paying stocks. It may trail the returns of the stock market but typically not by much over the long run. Most people don't have the ability to stick with a fund that's 100% stocks for many years, and they typically buy and sell at inopportune times, which means most folks get less than the fund's published returns. Don't assume you'll be different from everyone else. Buy a semi-boring fund like Vanguard Wellington and hold it for decades.
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