Author Topic: Alas has arrogance taken root in the Investor Alley  (Read 23155 times)

laserlady

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #50 on: November 07, 2017, 03:43:11 PM »
I have nothing to contribute here but I wanted to congratulate the OP for easily the strangest quote I've seen in a signature.

Yeah, it is pretty strange. It's suggesting to work for "love" (of the boss or the task?) as an employee (indentured servant?), with no pay, and that somehow that's better than doing an agreed upon job for an agreed upon wage?!?


Oh, I thought it was brilliant advice.  Why hire an adult to work for you when children are morons who can easily be exploited into working for you for free with the help of some emotional manipulation?  Especially since children are apparently idiot savants who can easily beat the market with a little guidance.  Who know what else they can accomplish?  I don't know why I don't have an army of child slaves working for me for free right now.  Good thing OP is around to set me on the track to success.

steveo

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #51 on: November 07, 2017, 04:34:35 PM »
One word: cannabis.

I like that but I'm not sure if I'd invest in it. I still would love to know how to beat the index though. Maybe my 3 kids can teach me.

steveo

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #52 on: November 07, 2017, 04:46:09 PM »
In the market, the vast majority of actively traded money and stocks is in the control of professional money managers of one stripe or another. They're generally extremely intelligent, work incredibly hard, and are backed up by some of the most advanced analytical tools money can buy. And, generally speaking, they don't successfully outperform index funds.

If I decide that I can actively trade in this world and do better than the weighted average of this market, then I'm also implicitly deciding that my estimation of likely market moves is superior to that of some of the smartest, hardest-working people in the world. As mrspendy puts it, stock picking is an arrogant act.

I would say Peter Lynch would disagree with you. There are a lot of analysts who lose sight of the forest for the trees. And even these smart, hard-working people can't get their act together and agree on any number of things when interviewed on CNBC or Bloomberg, so how smart are they? And stock picking isn't just analyzing numbers, a lot of it is instinct. That's what sets Buffet aside from others. Everyone has access to the same numbers. Its instincts that sets them apart.

The problem with calling it arrogant is that it overlooks a whole host of reasons why a stock could be a great buy. Many of these fund managers have benchmarks to meet and may be forced to play a hard before they want to as well. If I am not bound by the same rules they are restricted by, since I am the only person I am paying out to.  I can be more patient.

For example, we are hitting the beginning of an upward cycle for oil, for numerous reasons. Soon you'll be hearing from all sorts of analysts saying oil stocks are worth looking into, only this is after the bottom already happened. Buying up oil stocks in 2018 is like being late to the party. Not that money can't be made, but if the plan is to buy low and sell high, then now is the time.

Lets do this. MUR (Murphy Oil). I picked up in Sept at $23 when it near bottomed. They make their last debt payment in Dec and don't have another one due till 2022. They will be making money hands over first till then, paying a nice dividend for the price of the stock along the way. When the stock goes over $30 you'll start hearing analysts upgrading the stock. Then all the people who are behind the curve start buying it up and that is when I will sell. Note the closing quote info 9/1 for any ETF you want, and we'll compare % of gains since then when I go to sell, which I will come back here and announce.

It can be done. Not saying all the time but if you follow a certain sector, and international news, politics, and trends that can effect it, yes you can have success. If you don't have any interest in doing that, then yes leave it to someone else to do.

Is it safe to assume that you have successfully beat the market year after year? Or have you only occasionally managed to pick winners?

My FIL has made millions from trading the market. He is a really smart guy. He received scholarships throughout university and studied overseas. He ran the Forex trading at a big bank in two countries and then he managed the hedge fund of a billionaire. He is now extremely wealthy but he saved his money rather than spending it and invested the vast majority of his wealth in real estate. He even sometimes makes money on his own account but he also loses money on his account. The hedge fund also went bust.

The point is that my FIL is someone who has made money from the markets. Most of the money he has made has been from being paid an exorbitant salary to play the game of trying to beat the market rather than beating the market and he saved a huge amount of that salary and invested it conservatively. He is highly intelligent, educated and has spent a lifetime trading. If he can't make money reliably from the markets I can't see that I have any chance to beat the market.

thenextguy

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #53 on: November 07, 2017, 05:11:32 PM »
Do you guys know about the infamous "Rob Bennett?"  He was a market timing troll who spammed the shit out of the Morningstar Vanguard Diehards group, which uncontrollable trolling was the reason for the very existence of the Bogleheads site.  He also trolled GRS back in the original J.D. Roth days.  I give you this taste from the GRS archives:  http://www.getrichslowly.org/2009/06/02/the-lazy-way-to-investment-success/

That guy was arrogant and unstoppable.  Until banned.  I wonder if he is still around?

This guy?
http://www.passionsaving.com

MrThatsDifferent

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #54 on: November 07, 2017, 05:51:38 PM »
I use a pretty simple test for determining whether it's a good idea for me to try stock picking: I go and take a look at the times for the men's 5,000 metres at the last Olympics.

Wait, bear with me.

In the market, the vast majority of actively traded money and stocks is in the control of professional money managers of one stripe or another. They're generally extremely intelligent, work incredibly hard, and are backed up by some of the most advanced analytical tools money can buy. And, generally speaking, they don't successfully outperform index funds.

If I decide that I can actively trade in this world and do better than the weighted average of this market, then I'm also implicitly deciding that my estimation of likely market moves is superior to that of some of the smartest, hardest-working people in the world. As mrspendy puts it, stock picking is an arrogant act.

This is why I look at the 5,000 metres. Thanks to the sheer weight of the biggest and most professionalised players in the market, trading in the stock market is roughly equivalent to running a 5k against Olympian specialists. Successfully competing at that level involves being the trading equivalent of an Olympic finalist. I know what my best 5k time is, and I can compare it to the last-placed finalist from Rio.

It turns out that Joshua Cheptegei ran that final in 13:09. My personal best is a solid eight minutes slower than that. Not only can I not run that kind of pace, I'd be out of my goddamned mind to imagine I could ever run that kind of pace. I am not lean enough. I am not long-legged enough. I do not cool fast enough. I do not train enough. I will never train enough. But if running was like investing, I could beat Cheptegei and claim a time of 13:06 and change, simply by indexing my run. No 5am alarms for double sessions, no vomiting on the side of the track after one sprint too many, no skipping roast potatoes at Christmas because it doesn't match my diet. Instead I just sign a piece of paper that says I understand I'll get the average time from the final, and I magically lose thirty kilos and gain fifty watts on my power threshold.

In other words:
1. The existence of the index fund is like being able to become a sub-14-minute 5k runner by signing a document.
2. Given that there are no medals for being best at retiring, refusing to sign that document because you think you can train hard enough to go to 13:03 is not a particularly sane option for people simply aiming to retire early.

Someone add this to the best thing Iíve read on MMM today.

tralfamadorian

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #55 on: November 07, 2017, 07:44:41 PM »

JAYSLOL

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #56 on: November 07, 2017, 08:21:44 PM »


maizeman

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #58 on: November 07, 2017, 09:31:32 PM »
One word: cannabis.

I like that but I'm not sure if I'd invest in it. I still would love to know how to beat the index though. Maybe my 3 kids can teach me.

"One word: Plastics"

https://www.youtube.com/watch?v=PSxihhBzCjk&t=32

runbikerun

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #59 on: November 07, 2017, 11:54:40 PM »
Lets do this. MUR (Murphy Oil). I picked up in Sept at $23 when it near bottomed. They make their last debt payment in Dec and don't have another one due till 2022. They will be making money hands over first till then, paying a nice dividend for the price of the stock along the way. When the stock goes over $30 you'll start hearing analysts upgrading the stock. Then all the people who are behind the curve start buying it up and that is when I will sell. Note the closing quote info 9/1 for any ETF you want, and we'll compare % of gains since then when I go to sell, which I will come back here and announce.

That would be utterly meaningless. To stretch my earlier analogy, it'd be like me claiming I can run a flat 13 for the 5k and offering as evidence a 13-second 100m run from two years ago. The entire point of indexing is that over the long term you cannot beat the market: even if you did beat the index in this single specific test, it would be statistically insignificant unless we compared your investment history over the past thirty years to the operation of an index fund.

It's also thoroughly disingenuous, because this is a stock you already know has appreciated significantly since you bought it. I have no sight of any other investment you've made in the past few months that aren't looking good: all you're offering is a stock you bought at 23 and plan to sell at a little over 30, which is currently at 29.24. That's not a test by any stretch of the imagination. We have absolutely no idea how many other companies you've put money into: all we have as your evidence that stock picking is doable by ordinary people is a single backdated data point that's already about to crystallise.
« Last Edit: November 08, 2017, 04:46:56 AM by runbikerun »

BrokenBiscuits

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #60 on: November 08, 2017, 12:18:03 AM »
One word: cannabis.

explain

  His way of saying, "chill out man!"

Most likely in a thread about alternative to passive investments, they are suggesting they have and are happy with cannabis fund/stock investments.

Personally Iím about 50/50 half my money outside of pensions and my home is with vanguard but I do have a few active investments. Mostly India and Russia. Not for everyone but I have faith in long term india and short to medium term Russia.


boarder42

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #61 on: November 08, 2017, 08:27:56 AM »
Lets do this. MUR (Murphy Oil). I picked up in Sept at $23 when it near bottomed. They make their last debt payment in Dec and don't have another one due till 2022. They will be making money hands over first till then, paying a nice dividend for the price of the stock along the way. When the stock goes over $30 you'll start hearing analysts upgrading the stock. Then all the people who are behind the curve start buying it up and that is when I will sell. Note the closing quote info 9/1 for any ETF you want, and we'll compare % of gains since then when I go to sell, which I will come back here and announce.

That would be utterly meaningless. To stretch my earlier analogy, it'd be like me claiming I can run a flat 13 for the 5k and offering as evidence a 13-second 100m run from two years ago. The entire point of indexing is that over the long term you cannot beat the market: even if you did beat the index in this single specific test, it would be statistically insignificant unless we compared your investment history over the past thirty years to the operation of an index fund.

It's also thoroughly disingenuous, because this is a stock you already know has appreciated significantly since you bought it. I have no sight of any other investment you've made in the past few months that aren't looking good: all you're offering is a stock you bought at 23 and plan to sell at a little over 30, which is currently at 29.24. That's not a test by any stretch of the imagination. We have absolutely no idea how many other companies you've put money into: all we have as your evidence that stock picking is doable by ordinary people is a single backdated data point that's already about to crystallise.

You should post more

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #62 on: November 09, 2017, 12:40:22 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

boarder42

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #63 on: November 09, 2017, 01:02:27 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

You've done it for one year. So the Olympic analogy applies perfectly to this system.

Hargrove

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #64 on: November 09, 2017, 01:03:36 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

It's a great anecdote (and congratulations to you). Not, however, any sort of truth about the market generally. You're right that the Olympics analogy has a kink in the short term - you have no chance to beat an Olympic athlete on a 500 yd dash, yet a chance to beat the stock market - a couple times. Maybe even for a year. You have little chance, however, to consistently beat the stock market over the long term (usually we consider that 30 years), which is really what the analogy is meant to address.

When we have an 8-year-long raging bull, lots of great anecdotes like these will pop out, but they're terrible stock advice for the same reason Lady Gaga is not much proof that Jane Doe can go make millions with a career in music. You're correct that you can make money, and you're doing a disservice to ignore the overall proven rarity of beating indexes. It's not a values judgement or a "just put in the work" situation - overcoming other stock traders over the long term should be considered as difficult as the Olympics analogy makes it sound.

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #65 on: November 09, 2017, 01:27:56 PM »
Call it what you will, but there is room for both long term and short term plays. It's why I plan to completely cash out by July (sell the news), why the rest of my portfolio is in ETFs. Come July, I may get out of swing trading completely. But there is a short window where the average person can make a LOT of money. Heck my mother is doing it. It's not rocket science. Just keep your stops tight. Sector is overvalued atm. Xmas may be a good time to get back in if you're new at this.

Optimiser

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #66 on: November 09, 2017, 01:34:16 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

It's a great anecdote (and congratulations to you). Not, however, any sort of truth about the market generally. You're right that the Olympics analogy has a kink in the short term - you have no chance to beat an Olympic athlete on a 500 yd dash, yet a chance to beat the stock market - a couple times. Maybe even for a year. You have little chance, however, to consistently beat the stock market over the long term (usually we consider that 30 years), which is really what the analogy is meant to address.

The thing is though, you aren't running a 500 yard dash you're running a 5k. It's not really relevant that one or two of your 400 splits were faster than the Olympic runners because this is a 5k, and by the end of the race they are going to beat you.

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #67 on: November 09, 2017, 01:46:06 PM »
BTW, I realize my current strategy is at odds with the general tactics of this audience. It's why I'm posting here though. I'm generally very conservative and went out of my comfort zone when researching and investing cannabis stocks. I've observed that those who are conservative, strategic and rational are having great success with MJ stocks (vs the typical penny flippers who are impulsive and irrational).

Anyway, I meant to post about this last May, which was the time to buy. Just didn't feel like getting shot down in flames. Thought the thread topic was relevant though.

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #68 on: November 09, 2017, 03:39:58 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

No offense but this is exactly the investing arrogance we are discussing

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #69 on: November 09, 2017, 04:25:14 PM »
Do you know anything about swing trading? Seems like a response from someone who doesn't.

The topic is the arrogance of the groupthink mentality that insists index funds are the only way. Ironically the first page of responses was just clever put-downs like this one. No interesting discussion.

I'm saying it doesn't need to be either/or.

Hargrove

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #70 on: November 09, 2017, 05:03:22 PM »
Do you know anything about swing trading? Seems like a response from someone who doesn't.

The topic is the arrogance of the groupthink mentality that insists index funds are the only way. Ironically the first page of responses was just clever put-downs like this one. No interesting discussion.

I'm saying it doesn't need to be either/or.

What interesting discussion do you want for someone who shows up in a community to say "you're not all doing it my way and are all so arrogant not to change to my way, I'm leaving"? That's hilarious.

OP could have had a discussion. What people here don't put up with is "common sense" advice that you can beat the broad indices long term and "easily," because that advice is statistically wrong. Why be snide supporting opinions that have no evidence to back them up over the long term? Anyone at all can beat the index occasionally. Very, very, very few people have beaten the broad ones long-term, and advice on gambling is usually bad advice for FIRE.

Optimiser - we don't disagree, we're in the same boat on this, per the rest of my post. :p

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #71 on: November 09, 2017, 05:04:21 PM »
Do you know anything about swing trading? Seems like a response from someone who doesn't.

The topic is the arrogance of the groupthink mentality that insists index funds are the only way. Ironically the first page of responses was just clever put-downs like this one. No interesting discussion.

I'm saying it doesn't need to be either/or.

Oh Brother...    I should have put a smiley face on my post.   ;)

I'm just pointing out that you just cherry picked the 3rd best year in the history of the equities market to make your point know.   Not to mention the greatest bull market in history!    A retarded and blind monkey could beat the indexes the last decade.   Investing is a 60+ year affair were talking about. 

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #72 on: November 09, 2017, 05:20:38 PM »
Exactly. Except this is the biggest industry breakout in 100 years. So why aren't more people on this board taking advantage?  And why the hostility to those who are?

runbikerun

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #73 on: November 09, 2017, 06:19:57 PM »
I have to disagree with the Olympics analogy. One not be an expert to succeed in trading. I am a SAHM (former project manager) who has been swing trading cannabis stocks for the last year, with a 48% overall return on a measly 15K. My siblings have had bigger successes with less skills (they've put down more). I limit it to a small amount of my portfolio, but there are others who have retired on these stocks. I do my due diligence but mostly rely on others (like chartguys) for my TA. I don't daytrade but rather buy the dips and sell a few days or weeks later. The first step is realizing much of the volatility is based on hype - and yes this is a risk (though the gov't has July 1st announced for rec.)

And yes, I will admit, I partially do it for fun. Relax, people, and set up your practice account ;) The growth in this industry is unprecedented, and there are many smart people here who could excel at this if they start thinking a little more strategically.

This is exactly the point I was opposing in the first place. You're using as your example a single year of trading in which you're up 48%. That is not a statistically significant result. It's not even vaguely close to being a statistically significant result. You've had an above average year (although not as good as you may think, given that the passive equity fund my workplace pension scheme offers is up 39% in the same time frame), but that says absolutely nothing about your ability to do it on a consistent basis over decades. This has been tested and shown again, and again, and again, both in abstract mathematical analysis that indicates perhaps 0.6% of professional investors outperform the index, and in flashy large-scale bets between billionaires, like Warren Buffett's "index fund versus hedge funds" ten-year bet. Incidentally, the index beat the tar out of the hedge funds, returning close to four times as much money.

You will probably not beat the index over twenty years.
If you do, it will probably have been the result of dumb luck.
The odds that you are able to beat the index over twenty years through skill are, if you're being extremely optimistic, about one in a hundred and fifty.
The real odds are probably a hell of a lot longer.
This is not a pleasant thing to have to accept, but it's true.

sol

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #74 on: November 09, 2017, 06:24:21 PM »
You will probably not beat the index over twenty years.
If you do, it will probably have been the result of dumb luck.
The odds that you are able to beat the index over twenty years through skill are, if you're being extremely optimistic, about one in a hundred and fifty.
The real odds are probably a hell of a lot longer.
This is not a pleasant thing to have to accept, but it's true.

But what if I'm smarter than you?  All of you arrogant people are just dumb.

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #75 on: November 09, 2017, 06:32:32 PM »
Exactly. Except this is the biggest industry breakout in 100 years. So why aren't more people on this board taking advantage?  And why the hostility to those who are?

Hostility?!   LOL

Anyway....They do...then lose their ass (ie: retirement savings)  when the market takes a dive.     I don't think anyone is referring to "Fun Money" here.  If you want to double or triple your small $15K that's fine.   But please don't come onto an investing thread and imply that beating the indexes is easy and even "your mother can do it" over an investing lifetime.    I think that's where the runner analogy comes in.    Those who do beat the markets over long periods (over 40 years) are few and far between....like, only a handful of cases :)   

My biggest concern on this blog is that the demographics seem to be on the younger side.    I wonder what percentage of MMM FIRE crowd actually knows what they will do when your FIRE stash looses half its value in a couple months time?    I'm going to assume, but most here have known nothing but incredible equities growth their entire working lives.   It will be interesting to come back here when the market makes another correction :0
« Last Edit: November 09, 2017, 07:12:36 PM by surfhb »

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #76 on: November 09, 2017, 07:41:58 PM »
Again, I am not talking about 'beating the market' over 20 years. I'm talking about taking advantage of the upward momentum of a burgeoning industry for a specified period. Again, it's not either/or. And I am a total nerf trader. Imagine the potential that some of you have.

The echo chamber in here is comical, and the opinion polarization tactics unproductive. Kind of what I expected, but like to test it out every few months. This place needs more diversity.

Hargrove

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #77 on: November 09, 2017, 07:46:07 PM »
What do you mean? This forum is so popular that people will fill out a form, answer some unusual content questions, and even wait for approval just to show up and say they're leaving.

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #78 on: November 09, 2017, 07:53:22 PM »
Again, I am not talking about 'beating the market' over 20 years. I'm talking about taking advantage of the upward momentum of a burgeoning industry for a specified period. Again, it's not either/or. And I am a total nerf trader. Imagine the potential that some of you have.

The echo chamber in here is comical, and the opinion polarization tactics unproductive. Kind of what I expected, but like to test it out every few months. This place needs more diversity.

Huh?  We're not talking about the same thing.   Using "fun money" to play the next hot stock pick is a far cry from consistently out doing the indexes with your investing savings.

You got lucky is all.    Hell, I once made $15K in a single trading day on a biotech that went up %300 overnight back in the 90s.
« Last Edit: November 09, 2017, 07:56:21 PM by surfhb »

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #79 on: November 09, 2017, 08:06:57 PM »
Then why did you distort things and say that I was bragging about beating the indexes long term?

How am I lucky, if, as you said, a monkey can do it? There are a lot of lucky monkeys out there right now.

bacchi

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #80 on: November 09, 2017, 08:14:31 PM »
Again, I am not talking about 'beating the market' over 20 years. I'm talking about taking advantage of the upward momentum of a burgeoning industry for a specified period. Again, it's not either/or. And I am a total nerf trader. Imagine the potential that some of you have.

You'll need to figure out which cannabis stocks to buy because some will flop. You'll also need to figure out when to sell because the industry will eventually collapse (i.e., DOJ cracks down on an illegal industry) or become fairly priced.

Yeah, it can be done. It is a specific moment in history, much like 1999 and the 1.0 dotcom. Take a look at pets.com and see how that turned out.

JNPR was another darling of the 1.0 dotcom boom years and it's never recovered: Juniper Networks chart from 1999

Don't bet the farm on it.
« Last Edit: November 09, 2017, 08:19:46 PM by bacchi »

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #81 on: November 09, 2017, 08:20:39 PM »
I should clarify that I'm Canadian and talking about Canadian stocks. Not really following what's happening down south, though I have traded CRZ that has some US assets. It dips whenever Trump says something dumb. So, often :)

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #82 on: November 09, 2017, 08:27:35 PM »

There are a lot of lucky monkeys out there right now.

You got that right!   Take a look at the crypto currencies threads on here.

JLee

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #83 on: November 09, 2017, 08:28:06 PM »

There are a lot of lucky monkeys out there right now.

You got that right!   Take a look at the crypto currencies threads on here.

I really wish I bought bitcoin at $10...or $100....or $1000.

But, I don't have a crystal ball. :(

steveo

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #84 on: November 10, 2017, 03:46:41 AM »
Do you know anything about swing trading? Seems like a response from someone who doesn't.

The topic is the arrogance of the groupthink mentality that insists index funds are the only way. Ironically the first page of responses was just clever put-downs like this one. No interesting discussion.

I'm saying it doesn't need to be either/or.

I know heaps about swing trading. I also know that you can't predict the future. I bet that you will underperform the market over time.

I agree though that it doesn't have be either/or. You can choose to invest via index funds and retire early as well as gamble some money however you want to do that. You can't though choose to gamble and not invest in index funds because at some point I bet you will lose big time. Unless you quit early you will also lose those gains that you are so proud of. I've been there. Trading isn't a great long term idea.
« Last Edit: November 10, 2017, 03:50:58 AM by steveo »

runbikerun

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #85 on: November 10, 2017, 04:58:38 AM »
Again, I am not talking about 'beating the market' over 20 years. I'm talking about taking advantage of the upward momentum of a burgeoning industry for a specified period. Again, it's not either/or. And I am a total nerf trader. Imagine the potential that some of you have.

And trying to do this consistently will see you being outperformed by the index.

Maybe in this particular case it works out and you finish ahead. That still doesn't mean it was a good idea. Doing it carries a great deal more risk than investing in the index.

Travis

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #86 on: November 10, 2017, 08:24:21 AM »
Again, I am not talking about 'beating the market' over 20 years. I'm talking about taking advantage of the upward momentum of a burgeoning industry for a specified period. Again, it's not either/or. And I am a total nerf trader. Imagine the potential that some of you have.

The echo chamber in here is comical, and the opinion polarization tactics unproductive. Kind of what I expected, but like to test it out every few months. This place needs more diversity.

Then why did you distort things and say that I was bragging about beating the indexes long term?

How am I lucky, if, as you said, a monkey can do it? There are a lot of lucky monkeys out there right now.

We were discussing long term indexing. That was the OP's entire premise - that a child could beat it.  You then showed up to brag about your short term hot stock success.    As Bacchi alluded to, your success is not complete until you've figured out when these stocks will peak and cash out or remind us years later that you got in the ground floor through deliberate study and not luck.  If these companies crash and burn will you know about it in time?

This forum has quite a bit of diversity and always welcomes more; however, showing up and shouting "I beat the index this year and probably only this year for a portion of this year and you can too!" is the literal advertising model of unscrupulous active trading managers. They don't get a warm reception around here.

boarder42

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #87 on: November 10, 2017, 08:50:54 AM »
i made a well timed tesla play in 2013 and barely beat the market - i found MMM in feb 2014 and wised up after 17 years of trying to trade stocks b/c i thought that was how it worked.  But i dont advertise that one year i got lucky and barely beat the market b/c you arent going to do it consistently as has been said many times here active fund manager who spend hours and have large resources cant even do it.  so good luck with you pot pouri plays but you should just admit your gambling with it and not try to site it as a success story as you're trying to do.

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #88 on: November 10, 2017, 09:12:01 AM »
Wow, it's like you guys (all guys i'm assuming, from the know it all tone) just like to repeat your little mantras to yourselves over and over, regardless of the context. As for long term indexing, it's where 90% of my holdings are. I've set it and left it, and I'm trying to learn how to make some active income trading during an exceptional time in a burgeoning industry.

I was thinking there would be more Canadians on this that know about what's happening with the cannabis sector in Canada and why the stocks have been running up like this for years.

Here's one of a few relevant articles
https://beta.theglobeandmail.com/report-on-business/corporate-canada-warms-to-marijuana-industry/article36550498/?ref=http://www.theglobeandmail.com&

Once you've done some actual research, happy to discuss/debate further.  In the meantime I'll stick to the cannabis-specific threads.

boarder42

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #89 on: November 10, 2017, 09:21:41 AM »
Good points by all.

For example, I accept that MMMers are using real estate to build wealth faster.  If you know your local area, have tenant resources, can fix homes cheaper via your own labor, and have a super low cost morgage I dont doubt at all your story or claim that you will outperform the market's expected 6%ish returns.  There are whole threads outining the tactics and strategies.  A combo of #4 and higher concentration risk plus leverage has a good outcome probability curve.  May lose it all to a fire or something, but not a bad bet IMHO.



yes i think we can all agree the real estate sector is a great way to use leverage to get higher ROI than indexing.  our famous ARS is proof of that.  and biggerpockets strategies have proven track records of working and the current low interest rate environment helps facililtate this.

Maenad

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #90 on: November 10, 2017, 09:33:09 AM »
Yeah, it can be done. It is a specific moment in history, much like 1999 and the 1.0 dotcom. Take a look at pets.com and see how that turned out.

Those who do not learn from history are condemned to repeat it. The same "beating the market is easy" certainty was all over the place 20 years ago too - I saw tons of it on the old Motley Fool boards.

Everyone should read Bernstein's "The Four Pillars of Investing" before betting on their strategies with any significant amount of money.

caffeine

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #91 on: November 10, 2017, 01:00:24 PM »
I appreciate the forum being blunt. This is helpful to anyone who just begins investing and immediately begins thinking they'll beat the market or confuse investing and speculation.

Further, nothing is more helpful (in my opinion) than an emotional face punch to help someone financially. I need to someone willing to tell me I'm making a mistake.

jmwagner5

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #92 on: November 12, 2017, 10:32:58 AM »
Do you guys know about the infamous "Rob Bennett?"  He was a market timing troll who spammed the shit out of the Morningstar Vanguard Diehards group, which uncontrollable trolling was the reason for the very existence of the Bogleheads site.  He also trolled GRS back in the original J.D. Roth days.  I give you this taste from the GRS archives:  http://www.getrichslowly.org/2009/06/02/the-lazy-way-to-investment-success/

That guy was arrogant and unstoppable.  Until banned.  I wonder if he is still around?

This was some legendary level trolling in just one post.  Thanks for the share.

sol

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #93 on: November 12, 2017, 10:57:07 AM »
Do you guys know about the infamous "Rob Bennett?"  He was a market timing troll who spammed the shit out of the Morningstar Vanguard Diehards group, which uncontrollable trolling was the reason for the very existence of the Bogleheads site.  He also trolled GRS back in the original J.D. Roth days.  I give you this taste from the GRS archives:  http://www.getrichslowly.org/2009/06/02/the-lazy-way-to-investment-success/

That guy was arrogant and unstoppable.  Until banned.  I wonder if he is still around?

This was some legendary level trolling in just one post.  Thanks for the share.

For people who won't follow the rabbit hole, I think we're talking about the following post from that link (quoted below), that argues that market timing is the best way to index.





Quote
I am a severe critic of the Lazy Investing approach, at least in its conventional form.

I see the appeal. There is indeed a huge amount of unnecessary complexity in much of what we hear about investing. Avoiding needless complexity is a perfectly sensible goal.

And there is no need to pick individual stocks. Index funds provide huge diversification at low cost. They are a great option for those of us who have other things we want to do with our free time than research stocks.

Thereís even a sense in which I advocate a Lazy Investing approach myself. I advocate Valuation-Informed Indexing, which is an indexing strategy in which you lower your stock allocation at times of insanely high prices and increase it at times of insanely low prices.

The problem with the other Lazy Investing approaches is that they do not call for changing oneís stock allocation in response to big price swings. When you fail to adjust your stock allocation, you permit your risk level to go wildly off the mark from what you had intended it to be and from what is right for you. That means that you end up suffering huge losses and eventually feel pressed to abandon stocks altogether.

The particular form of laziness that causes people not to want to consider stock prices when setting their allocations is a form of laziness that generates huge amounts of stress in the long run. Valuation-Informed Indexing is a low-stress ďlazyĒ approach. Thereís nothing appealing in my eyes to being worried that my retirement plan is not going to work out because I was too ďlazyĒ to make the adjustments in my allocation needed to keep my risk profile roughly stable.

How often do you need to change your allocation to achieve a low-stress approach to laziness? About once every 10 years on average. But the one change in 10 years means the difference between an approach that works in the real world and one that does not. I donít believe in being so lazy that I am not willing to take that one critical step toward achieving my goal of long-term investing success.

Rob

tralfamadorian

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #94 on: November 12, 2017, 12:21:58 PM »
Wow, it's like you guys (all guys i'm assuming, from the know it all tone) ...

There's no need to be sexist to try to prove a point. 

BTW, it has been previously shown (extrapolated?) that the MMM forum is over 50% female.  Confidence + data driven =/ XY chromosomes.

I'll look forward to your return in ten years to show up how wrong we are- just like this guy-
https://www.investopedia.com/articles/investing/030916/buffetts-bet-hedge-funds-year-eight-brka-brkb.asp

Tegus

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #95 on: November 13, 2017, 02:45:45 PM »
Wow, it's like you guys (all guys i'm assuming, from the know it all tone) ...

There's no need to be sexist to try to prove a point. 

BTW, it has been previously shown (extrapolated?) that the MMM forum is over 50% female.  Confidence + data driven =/ XY chromosomes.

I'll look forward to your return in ten years to show up how wrong we are- just like this guy-
https://www.investopedia.com/articles/investing/030916/buffetts-bet-hedge-funds-year-eight-brka-brkb.asp

Wow - the point has been missed yet again.

I won't get into the correlation between arrogance and gender but you just made my point by not paying attention to what I wrote.

There won't be a comparison in 10 years time because my $$ will be back in index funds by this july, when Canadian legalization of recreational marijuana begins. or perhaps sooner. sold half my portfolio after another 20% run up today. I think a correction is overdue.

If there is another industry blow up with like this one I may consider getting back in - but since this is the biggest one in a century, the statistics are against us.

All I am saying is sometimes you have to reassess your position when new information comes in. And that may require going outside your comfort zone.


https://beta.theglobeandmail.com/globe-investor/investment-ideas/marijuana-stocks-in-melt-up-amid-canadian-legalization-fever/article36938808/?ref=http://www.theglobeandmail.com&

« Last Edit: November 13, 2017, 02:47:46 PM by Tegus »

OurTown

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #96 on: November 13, 2017, 03:31:14 PM »
You should sell when it reaches $4.20.

Financial.Velociraptor

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #97 on: November 13, 2017, 04:18:00 PM »
If I can tootle my own horn...I'm doing just fine as a stock picking heretic.  Summary of my market performance is always available on my blog here: http://velociraptor.cc/transparency/

maizeman

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #98 on: November 13, 2017, 05:10:08 PM »
There won't be a comparison in 10 years time because my $$ will be back in index funds by this july, when Canadian legalization of recreational marijuana begins. or perhaps sooner. sold half my portfolio after another 20% run up today. I think a correction is overdue.

If there is another industry blow up with like this one I may consider getting back in - but since this is the biggest one in a century, the statistics are against us.

Just to be clear, you are saying pot is going to be bigger than microchips? And the end of prohibition? And the internet and all the new business models which came along with it?

surfhb

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Re: Alas has arrogance taken root in the Investor Alley
« Reply #99 on: November 13, 2017, 05:52:27 PM »
If I can tootle my own horn...I'm doing just fine as a stock picking heretic.  Summary of my market performance is always available on my blog here: http://velociraptor.cc/transparency/

Rate of return vs the S&P and length of time investing?