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Buy and Hold produces the best statistical long term returns for the average Joe investor, and that's only when diversified in index funds. That is by far the best method for long term success for hands off approach.
This is what trips me out though, who is the "average Joe" investor? And if he's "average Joe" why is he investing in the first place? It seems like all that's happening here, is you have a guy that has no CLUE what the hell he's doing (the guy named Joe) so he just spreads his money out across thousands of different stocks and bonds in various indexes such as using this fund here: https://personal.vanguard.com/us/fun...FundIntExt=INT because the guy really has no clue what he's doing.
My question is this, if you don't understand what you are doing (average Joe), then why are you doing it? Why not only invest in what you totally, completely, up, down, sideways and backwards....understand?
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For hands on approach many people don't know what they're doing.
I made a statement saying I don't fully understand the Stock Market and people have tried to use that to attack me. But they didn't finish my statement, because I said I don't fully understand the Stock Market and neither does the MAJORITY of anybody in the market either.
Let's face it, nobody knows whether stocks are going up, down, sideways, backwards, etc. People have just been brainwashed and sold on this idea of stock investing. Just like you have guys on here that don't even know when they are holding paper assets, that they ARE NOT investing in the companies they are holding. The companies already got their money when they issued the stock, you are doing nothing but trading back and forth with other people on the "market"...the "stock market".
You are not investing in any company when you trade stock, sorry to break the news to you.
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For individual stocks, buy and hold may NOT be the best, but unless you really know what your doing and have the time to do it, the best approach is low cost index funds spread amount different equity and even asset classes if your investment strategy calls for it.
Back to my question above, if the guy doesn't know what he's doing, why invest in the stuff at all? Put your money in a damn Long Term CD and call it a day, at least you understand what a CD is and how it works. Why would anybody invest in anything they don't understand, just because "people" say it's what you are supposed to do? Are those "people" going to eat your losses if it doesn't work out? I don't think so.....
Last edited by jotucker99; 08-22-2015 at 08:49 AM..
with so much admittance on not understanding the markets why do you insist on arguing points about investing when you lack the knowledge and experience to even do so ?
with so much admittance on not understanding the markets why do you insist on arguing points about investing when you lack the knowledge and experience to even do so ?
Another Strawman.
You can't debate ANY points I put out there, that's why you keep resorting to this supposed "lack of knowledge and education" that I have when you have no such PROOF of this supposed "lack of knowledge and education".
Typical poor debating tactic that a person uses when they can't fully address ANY point you bring up.
please , you have so little in facts correct it is pathetic how you argue
Lol, oh really, when you go through and debunk my stances then I will be ready. You can start with the Balanced Fund v.s. Long Term CD 15 year information I presented to you already.
Give it up already . You want to invest in cd's at 2.50% go a head . No one here has a clue as to what you want us to tell you . yeah 2-1/2 % is a great deal to put your money in for the next 5 years .
Give it up already . You want to invest in cd's at 2.50% go a head . No one here has a clue as to what you want us to tell you . yeah 2-1/2 % is a great deal to put your money in for the next 5 years .
Do it and give it a rest .
Lol, 2.5% huh? It's funny how you avoid answering direct questions and looking at direct counter analysis to all of the analysis you provide on why Balanced Funds are the way to go.
There's no escaping this one MathJak, I took your mantra of using long term horizons of at least 15 years to judge the quality of an investment. I showed you the compounding rate of return with resources, charts, etc. of the Balanced Funds (like Vanguard Wellington or the Vanguard Life Strategy Funds) v.s. the performance of Long Term (5 years or more) CDs over the period of 1993/1994 - 2013.
The numbers don't lie, the Balanced Funds in terms of compounding were 6% - 7% and the Long Term CDs in terms of compounding were 5%.
Why would you encourage an investor to ride the roller coaster, go through the headaches, etc. of 15 years of his life (that he can't get back by the way) just to make 1% - 2% more?
Before I did all of this analysis, posted these resources, etc., you were one of the main proponents saying that CDs were garbage. Yet, the numbers are right here in front of you and you literally don't know what to say.
I also gave you my prediction going forward over the next 20 years. I believe Balanced Funds like Wellington will average 5.5% - 7% compounding and Long Term CDs will average 4% - 5% compounding. CDs are going to go UP the moment the Fed increases the rate, by 2018 expect Long Term CDs to be over 4%. As a result, I'm going to take the CD returns which are FDIC Insured and go home.
The only way you are going to get significantly higher compounding returns in the market is to not use a Balanced Fund, but go all in on the S&P Index or become a Stock Guru yourself and do your own trades to out perform the market. Neither of which I recommend (and I'm sure you don't either MathJak) that anybody do.
I also invest pretty heavily in CDs and they are worth it in peace of mind.
The median Joe and Jane household in America make about $55K a year. So everyone up to about 50% greater than the median - pretty much the bottom 80% - is not going to do much better on the stock market. Oh, they'll do better, but what does it really buy them? At those levels, how much will an extra 1-2% net them? $20K, if that? Well, they can buy an extra 100 sq. ft. in retirement with that, whoop dee doo. That is if you don't happen to retire around the time of a correction or crash.
Peace of mind is worth a lot of money to me.
I was burned badly in the market in '08-09. I made it out and pulled my money out in 2011 after it had come back with a modest return and was happy about it. What a sense of relief. No amount of returns could make me get back in as much as I was - it was a horrible feeling thinking that I'd lost my life savings to a bad investment. Have I missed out? Sure, at the level I was at, I'm maybe $7-13K at most poorer than I would have been. Again, whoop-dee-doo. I could understand if I was losing out on millions, but we're talking a few grand here or there with the average joe money I make.
Now that I have some surplus, I'm very slowly dipping my toes back into the market, but no way in heck will I ever be 60-80% in it again. At most 25%.
I agree with you. Also not sure where your CDs are housed, but look at places like Vanguard as they will usually have higher rates of return on the Long Term CDs than your local Bank/Credit Union. It's just with a Brokered CD you want to make sure there's no reason for you to ever break it early, you want to keep that thing going until it's 100% done or there's potential for significant losses with the CD.
My thread has been totally quiet without hardly any of the usual "Stock Market/Mutual Fund" lovers saying anything because they know (like I know) that numbers don't lie.
The fact is that a lot of these people have just been programmed by commercials, their peer circle, etc. to think that investing in the Market is the ONLY way to make it. One guy flat out told me on here that if I didn't get into the market, I would starve in retirement, as if making 2% more on my money over a long period of time in a Fund is going to be the difference between me having a successful retirement or living on food stamps.
I agree with you. Also not sure where your CDs are housed, but look at places like Vanguard as they will usually have higher rates of return on the Long Term CDs than your local Bank/Credit Union. It's just with a Brokered CD you want to make sure there's no reason for you to ever break it early, you want to keep that thing going until it's 100% done or there's potential for significant losses with the CD.
My thread has been totally quiet without hardly any of the usual "Stock Market/Mutual Fund" lovers saying anything because they know (like I know) that numbers don't lie.
The fact is that a lot of these people have just been programmed by commercials, their peer circle, etc. to think that investing in the Market is the ONLY way to make it. One guy flat out told me on here that if I didn't get into the market, I would starve in retirement, as if making 2% more on my money over a long period of time in a Fund is going to be the difference between me having a successful retirement or living on food stamps.
Lol, I mean you can't make this stuff up.
Vanguard's balanced index fund since 11/1992 is up on average 8.27%
How have you pushed it down to 6-7%? How do you also not understand that a return of 20-40% more every year for 15-30 years could have a great impact?
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