Author Topic: How to ignore stock pickers within your social circle  (Read 3542 times)

SPM87

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How to ignore stock pickers within your social circle
« on: January 09, 2023, 02:36:28 PM »
I have a couple of people who are stock pickers in my life, some of them even try to almost make me feel dumb for being an indexer and advocate for index investing.

One of them has bought a lot into poly metal in the uk because they think if the war ends it will make them a lot of money they seem to think and make compelling arguments as to how cheap it is.

If they turn out to make a lot of money on one stock, and quick fire their way to early retirement due to a war ending for example, I will likely be teased and laughed at for being an indexer even further

Any advice on this? Sorry for the burden I just feel on my own and only this site feels like it understand me lol
« Last Edit: January 09, 2023, 02:39:08 PM by SPM87 »

ixtap

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Re: How to ignore stock pickers within your social circle
« Reply #1 on: January 09, 2023, 02:44:07 PM »
"Well, I guess we will have a real life comparison in the coming years, then!"

Psychstache

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Re: How to ignore stock pickers within your social circle
« Reply #2 on: January 09, 2023, 02:47:39 PM »

2Birds1Stone

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Re: How to ignore stock pickers within your social circle
« Reply #3 on: January 09, 2023, 02:48:23 PM »
Why do you feel the need to compare investment strategies? Do you whip out wangs and see whose is larger?

solon

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Re: How to ignore stock pickers within your social circle
« Reply #4 on: January 09, 2023, 02:48:51 PM »
You might have to have a 2 minute heart-to-heart with your friend:

"Indexing is the right path for me. That doesn't mean you have to be an indexer, and you're still free to discuss your stock picks with me. But it's a real turn off when you start looking down your nose at me."

Villanelle

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Re: How to ignore stock pickers within your social circle
« Reply #5 on: January 09, 2023, 03:04:12 PM »
"I'm happy for you, but I'm also happy with my choices and long term strategies, and I wish you could respect that.  We've had this conversation before, several times and I wish you'd let it go and just accept that the right answer for you is not the same as the right answer for me. If we could have this discussion while being respectful of each other's choices, I'd be happy to have an open conversation about the pros and cons of various investing methods.  But since it turns to criticism and gloating, it seems like maybe, for the sake of our friendship, we should stop discussing investing. Let's just agree to respect each other's choices and let this one go, okay?"


That said, you mention you are an "advocate for index investing".  That could mean a lot of things, but if you are trying to prove them wrong, then it's only fair an reasonable--and expected--that they do the same.  If they aren't asking for advice, don't give it, even if you disagree with their strategy.  When they tell you they are buying into XYZ because they are sure it will make them rich if only A and B happen, just smile and say, "I hope it does make you rich, and I can't wait to be invited to the parties!"  If you are trying to argue the greatness of your method, they are going to do the same.  So don't engage on that level.  Wish them well, and change the subject.

And finally, if these are people who will actually "tease and laugh at you" for not getting as rich as quickly as they did, you might want to rethink the relationships. 

GuitarStv

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Re: How to ignore stock pickers within your social circle
« Reply #6 on: January 09, 2023, 03:09:22 PM »
"I like not having to think or worry about my investments."

Michael in ABQ

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Re: How to ignore stock pickers within your social circle
« Reply #7 on: January 09, 2023, 03:10:54 PM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

GuitarStv

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Re: How to ignore stock pickers within your social circle
« Reply #8 on: January 09, 2023, 03:15:34 PM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #9 on: January 09, 2023, 03:29:35 PM »
Why do you feel the need to compare investment strategies? Do you whip out wangs and see whose is larger?

I don’t, they do though, if this stock goes up I get texts etc… but yes the people who send me this are the comparing type.

It originally went along the type of “you should buy this stock etc” and I say I don’t do that as I don’t think the data suggests it will work long term so I index “ type thing

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #10 on: January 09, 2023, 03:37:48 PM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

Their logic on this particular stock I mentioned is strong, it’s a gold mining company and it went down due to potential sanctions etc that they have avoided but didn’t stop the stock going down 90%. If the war ends it would probably go up quite a bit too. So the arguments are strong.

Not sure if anyone knows people who have won big on one stock hit ?

HPstache

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Re: How to ignore stock pickers within your social circle
« Reply #11 on: January 09, 2023, 04:01:55 PM »
It's the crypto bros that are way more fun to watch

Plugra

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Re: How to ignore stock pickers within your social circle
« Reply #12 on: January 09, 2023, 05:50:46 PM »
"I like to spend my time and effort on other things.  Given that index investing consumes virtually zero time or effort, I find the net return is competitive with the stock-picking approach"

GilesMM

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Re: How to ignore stock pickers within your social circle
« Reply #13 on: January 09, 2023, 08:20:16 PM »
I just listen politely, ask a few questions, wish them great luck and move on to a more interesting topic.

JAYSLOL

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Re: How to ignore stock pickers within your social circle
« Reply #14 on: January 09, 2023, 08:47:46 PM »
Deflect it by trivializing the whole conversation “what a first world problem we have comparing investment strategies”, then start talking about something else, if they try to force it back to their beliefs on picking stocks they look look a little shallow.  Of course this only works if you weren’t bringing up your beliefs on investing and merely reacting to his. 

reeshau

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Re: How to ignore stock pickers within your social circle
« Reply #15 on: January 09, 2023, 09:58:16 PM »
Are you really looking for consoling voices, or trying to influence their behavior and make their presence more comfortable for you?

For kindred voices, read The Little Book of Commonsense Investing, by Jack Bogle, and Thinking In Bets by Annie Duke.  Jack's book, of course, talks about indexing, and makes the case for it vs. actively-managed mutual funds.  Annie's book is all about identifying skill vs. luck.  She advocates against "resulting": mistaking the end result as deserved, whether good or bad.

“Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.” --Joel Greenblatt

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #16 on: January 10, 2023, 02:24:34 AM »
Are you really looking for consoling voices, or trying to influence their behaviour and make their presence more comfortable for you?

For kindred voices, read The Little Book of Commonsense Investing, by Jack Bogle, and Thinking In Bets by Annie Duke.  Jack's book, of course, talks about indexing, and makes the case for it vs. actively-managed mutual funds.  Annie's book is all about identifying skill vs. luck.  She advocates against "resulting": mistaking the end result as deserved, whether good or bad.

“Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.” --Joel Greenblatt

Yes I am, I am not sure why you presume to think I am trying to influence them when it is clear I am pointing to the opposite behaviour happening. Ever been in a position where you are almost forced and pressured to justify your position?

I actually enjoy the opposite point of view as long as its objective but increasingly it feels more like I am being laughed at for indexing and will get so much worse if the stock actually goes back to where it was. Perhaps I need to just re-evaluate and never get into any discussion on it without being rude or dismissive. It would actually be a waste of time trying to influence as decisions have been made. I notice one learning from it though, which puts me off stock picking completely, once they buy into it, it becomes almost cult like in their thinking, no objectivity the stock HAS to go up, there is no way it can stay down!. I get it, it could be life changing for them if it does go that way, or perhaps not as I get the feeling if this even goes up then it will be onto the next "winner" which could have the opposite result.

I guess I do not have much constructive points back regarding individual stocks as it always seemed like a no brainer not to do it for me, too much risk and sleepless nights worrying about it for me, but others seem on the surface at least, different. Watching WBs bet against Hedge Funds play out sealed it for me also.

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Re: How to ignore stock pickers within your social circle
« Reply #17 on: January 10, 2023, 05:10:02 AM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

Their logic on this particular stock I mentioned is strong, it’s a gold mining company and it went down due to potential sanctions etc that they have avoided but didn’t stop the stock going down 90%. If the war ends it would probably go up quite a bit too. So the arguments are strong.

Not sure if anyone knows people who have won big on one stock hit ?

Often the logic on why a stock should go up (or down) appears strong, but that doesn’t mean events will unfold as you suspect. The war could end soon, or it could drag on; the price of gold could stay high, or it could crash; the company in question could become a cash cow, or it could have previously undisclosed corruption; regulations in this space could become free and fair, or they could be manipulated by any number of governmental policies; their operations could have smooth sailing in the years ahead, or they could be hit by any number of unfortunate events. 

WHat I find remarkable about the majority of ‘bad events’ is how many of them were either not on anyone’s radar or written off as unlikely just 6-12 months before they came to pass.  Kind of like Russia’s invasion of Ukraine. And the converse - how many things most are certain will happen which never come to pass (a lot of predicted recessions and large government regulations/spending fall into this caterogy).

None of this will convince your friends, because they are self-assured that they can see the obvious and beat the random walk of the markets.  In generally most of these types write off being wrong as bad luck / not-their-fault and being right as testament to their obvious brilliance.

Metalcat

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Re: How to ignore stock pickers within your social circle
« Reply #18 on: January 10, 2023, 05:25:33 AM »
Maybe get better friends who don't pick on you for your perfectly reasonable life choices?

Or at least better boundaries with them.

reeshau

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Re: How to ignore stock pickers within your social circle
« Reply #19 on: January 10, 2023, 05:52:57 AM »
None of this will convince your friends, because they are self-assured that they can see the obvious and beat the random walk of the markets.  In generally most of these types write off being wrong as bad luck / not-their-fault and being right as testament to their obvious brilliance.

This is exactly the premise of Thinking In Bets.  It's not just certain people, it's everyone.  (I have read research that says it is a Western cultural trait.  In Eastern cultures, it is opposite.  A question I'd really like to ask Annie, since gambling exists in both)  Annie is a trained psychologist, who became a professional gambler while on sabbatical from her doctoral thesis.  She has effectively been studying poker players in the wild ever since.  The book is quite accessible, but also has an extensive bibliography, with a lot of citations to academic research.

One of the most interesting observations is that intelligence is positively correlated with the above behavior.  The smarter you are, does not mean the better you are at dealing with your blind spots.  Rather, the smarter you are means the better stories you tell yourself, when you justify your actions.

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #20 on: January 10, 2023, 06:31:18 AM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

Their logic on this particular stock I mentioned is strong, it’s a gold mining company and it went down due to potential sanctions etc that they have avoided but didn’t stop the stock going down 90%. If the war ends it would probably go up quite a bit too. So the arguments are strong.

Not sure if anyone knows people who have won big on one stock hit ?

Often the logic on why a stock should go up (or down) appears strong, but that doesn’t mean events will unfold as you suspect. The war could end soon, or it could drag on; the price of gold could stay high, or it could crash; the company in question could become a cash cow, or it could have previously undisclosed corruption; regulations in this space could become free and fair, or they could be manipulated by any number of governmental policies; their operations could have smooth sailing in the years ahead, or they could be hit by any number of unfortunate events. 

WHat I find remarkable about the majority of ‘bad events’ is how many of them were either not on anyone’s radar or written off as unlikely just 6-12 months before they came to pass.  Kind of like Russia’s invasion of Ukraine. And the converse - how many things most are certain will happen which never come to pass (a lot of predicted recessions and large government regulations/spending fall into this caterogy).

None of this will convince your friends, because they are self-assured that they can see the obvious and beat the random walk of the markets.  In generally most of these types write off being wrong as bad luck / not-their-fault and being right as testament to their obvious brilliance.

do you think that even if people like this win one "bet" or "speculation" they eventually hit a bad run and go behind the market? The data appears to be solid in this, surely the data would be picking up people who get in one time and get out therefore "beat the market" ? some of them have stated that the data wont pick up individual retailer investors who win?

more insight on this would be great.

Metalcat

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Re: How to ignore stock pickers within your social circle
« Reply #21 on: January 10, 2023, 06:42:37 AM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

Their logic on this particular stock I mentioned is strong, it’s a gold mining company and it went down due to potential sanctions etc that they have avoided but didn’t stop the stock going down 90%. If the war ends it would probably go up quite a bit too. So the arguments are strong.

Not sure if anyone knows people who have won big on one stock hit ?

Often the logic on why a stock should go up (or down) appears strong, but that doesn’t mean events will unfold as you suspect. The war could end soon, or it could drag on; the price of gold could stay high, or it could crash; the company in question could become a cash cow, or it could have previously undisclosed corruption; regulations in this space could become free and fair, or they could be manipulated by any number of governmental policies; their operations could have smooth sailing in the years ahead, or they could be hit by any number of unfortunate events. 

WHat I find remarkable about the majority of ‘bad events’ is how many of them were either not on anyone’s radar or written off as unlikely just 6-12 months before they came to pass.  Kind of like Russia’s invasion of Ukraine. And the converse - how many things most are certain will happen which never come to pass (a lot of predicted recessions and large government regulations/spending fall into this caterogy).

None of this will convince your friends, because they are self-assured that they can see the obvious and beat the random walk of the markets.  In generally most of these types write off being wrong as bad luck / not-their-fault and being right as testament to their obvious brilliance.

do you think that even if people like this win one "bet" or "speculation" they eventually hit a bad run and go behind the market? The data appears to be solid in this, surely the data would be picking up people who get in one time and get out therefore "beat the market" ? some of them have stated that the data wont pick up individual retailer investors who win?

more insight on this would be great.

Yes, averages fail to detect individual cases of luck when looking at averages.

You can't guarantee that your buddies won't get lucky and rub it in your face. Plenty of people made a ton of money off of crypto that has since crashed. Did most people lose money? Yep. Did everyone? No, absolutely not.

If your buddies get lucky and manage to wildly outperform the market by picking when to buy and when to sell, then they're probably going to think they're pretty damn good at investing.

You also don't want to be counting on your friends doing financially poorly so that they won't pick on you. That's not healthy.

Your friends don't seem to respect your personal choices. That's a problem. You shouldn't need to convince all of your friends that your perfectly reasonable investment strategy is reasonable.

You aren't dealing with a financial issue, you're dealing with a respect issue.

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #22 on: January 10, 2023, 07:11:29 AM »
I learned the hard way back in 2008 the risk of holding individual stocks. I was younger then and my stock portfolio that lost 70% of its value was a significant portion of my net worth at the time.


It's a lot easier to be a great stock picker when you're in a decade long bull market. How many people that made millions on Tesla, Amazon, Bitcoin, etc. sold out at the top? How many held on and saw the value of their investments plunge? Those aren't the ones they'll brag about of course.

The worst possible thing that can happen to you is to have early luck picking stocks, and determine that you've figured it all out.  :P

Their logic on this particular stock I mentioned is strong, it’s a gold mining company and it went down due to potential sanctions etc that they have avoided but didn’t stop the stock going down 90%. If the war ends it would probably go up quite a bit too. So the arguments are strong.

Not sure if anyone knows people who have won big on one stock hit ?

Often the logic on why a stock should go up (or down) appears strong, but that doesn’t mean events will unfold as you suspect. The war could end soon, or it could drag on; the price of gold could stay high, or it could crash; the company in question could become a cash cow, or it could have previously undisclosed corruption; regulations in this space could become free and fair, or they could be manipulated by any number of governmental policies; their operations could have smooth sailing in the years ahead, or they could be hit by any number of unfortunate events. 

WHat I find remarkable about the majority of ‘bad events’ is how many of them were either not on anyone’s radar or written off as unlikely just 6-12 months before they came to pass.  Kind of like Russia’s invasion of Ukraine. And the converse - how many things most are certain will happen which never come to pass (a lot of predicted recessions and large government regulations/spending fall into this caterogy).

None of this will convince your friends, because they are self-assured that they can see the obvious and beat the random walk of the markets.  In generally most of these types write off being wrong as bad luck / not-their-fault and being right as testament to their obvious brilliance.

do you think that even if people like this win one "bet" or "speculation" they eventually hit a bad run and go behind the market? The data appears to be solid in this, surely the data would be picking up people who get in one time and get out therefore "beat the market" ? some of them have stated that the data wont pick up individual retailer investors who win?

more insight on this would be great.

Yes, averages fail to detect individual cases of luck when looking at averages.

You can't guarantee that your buddies won't get lucky and rub it in your face. Plenty of people made a ton of money off of crypto that has since crashed. Did most people lose money? Yep. Did everyone? No, absolutely not.

If your buddies get lucky and manage to wildly outperform the market by picking when to buy and when to sell, then they're probably going to think they're pretty damn good at investing.

You also don't want to be counting on your friends doing financially poorly so that they won't pick on you. That's not healthy.

Your friends don't seem to respect your personal choices. That's a problem. You shouldn't need to convince all of your friends that your perfectly reasonable investment strategy is reasonable.

You aren't dealing with a financial issue, you're dealing with a respect issue.

I agree and thanks for the input - I guess my case against is a general " to me, picking a stock feels like gambling and I do not like Gambling and dont want to fool myself to thinking I am investing, rather than gambling" after my position its a general swipe at indexes etc... the conversation then goes sour a bit and I move it on. I guess what happens is then I have to re-think if I am missing something but then when I do my research again I get back to my same position lol.

Perhaps I should just keep to my path and conviction and avoid ever talking about the nature of stock picking. This simplify my life strategy and keep my income seems to be the best idea for ME. I am not a business owner, not sure if I would ever want to be one and don't have any great ideas that have not already been tried to probably be a rich business owner also.

I guess my weakness is I just doubt myself too much

GuitarStv

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Re: How to ignore stock pickers within your social circle
« Reply #23 on: January 10, 2023, 07:14:37 AM »
It's very rare that anyone gambling ever quits while they're ahead if they think they understand the system and can keep winning.  If you recognize the luck involved in your decision, then of course you would bail out as soon as you get ahead . . . but doing that means that you wouldn't be trying to tell other people to do exactly what you did (knowing the element of chance involved).

harvestbook

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Re: How to ignore stock pickers within your social circle
« Reply #24 on: January 10, 2023, 07:24:07 AM »
"Just because you win the lottery doesn't me you're not an idiot for having played. Good day."

iris lily

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Re: How to ignore stock pickers within your social circle
« Reply #25 on: January 10, 2023, 07:47:38 AM »
Are you kidding? I am MARRIED to a stock picker. He belongs to an “investment club” where a bunch of old men sit around once a month and discuss their little hobby-firm’s investments. He doesn’t have much money in the firm, around $6,000. This is a group that exists to learn about investing. Or should I say “ learn about investing?” Haha.

I occasionally make comments to him about how this is an old man’s game, but he likes doing it and so, whatever. As the old men in the group die out they are having trouble finding new blood. No kidding guys! the millenniums and Xers are smarter about  current investment opportunities.
« Last Edit: January 10, 2023, 07:51:12 AM by iris lily »

iris lily

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Re: How to ignore stock pickers within your social circle
« Reply #26 on: January 10, 2023, 07:48:31 AM »
"I like not having to think or worry about my investments."
This right here.

nereo

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Re: How to ignore stock pickers within your social circle
« Reply #27 on: January 10, 2023, 07:53:15 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

Psychstache

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Re: How to ignore stock pickers within your social circle
« Reply #28 on: January 10, 2023, 07:56:02 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.

nereo

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Re: How to ignore stock pickers within your social circle
« Reply #29 on: January 10, 2023, 08:00:20 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.
Agreed. And I don't think it is ever one that's likely to "die out" with the passing of a particular generation.

iris lily

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Re: How to ignore stock pickers within your social circle
« Reply #30 on: January 10, 2023, 08:25:13 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.
Agreed. And I don't think it is ever one that's likely to "die out" with the passing of a particular generation.

True, so maybe this old men’s group needs to add some crypto to their portfolio to entice the cryotobros.

the_hobbitish

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Re: How to ignore stock pickers within your social circle
« Reply #31 on: January 10, 2023, 09:18:35 AM »
I'm the index investor among my coworkers. Stock picking and market timing is a lot more exciting to talk about (for them). I don't contribute much to the conversation because by now I know they hold a different investing strategy and aren't open to switching. I'd like to be able to contribute more, but I understand to look for engagement on that topic from other likeminded people.

I enjoy listening to their banter about getting in and out of the market the same way I can build some comradery from engaged listening on the occasional sports team conversation I have no stake in...

That said none of them tease/ridicule me for my choices or vice versa.

sonofsven

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Re: How to ignore stock pickers within your social circle
« Reply #32 on: January 10, 2023, 09:30:34 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.
I do: it's men. Oh wait, I'm a man.

reeshau

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Re: How to ignore stock pickers within your social circle
« Reply #33 on: January 10, 2023, 09:42:15 AM »
Are you kidding? I am MARRIED to a stock picker. He belongs to an “investment club” where a bunch of old men sit around once a month and discuss their little hobby-firm’s investments. He doesn’t have much money in the firm, around $6,000. This is a group that exists to learn about investing. Or should I say “ learn about investing?” Haha.

I occasionally make comments to him about how this is an old man’s game, but he likes doing it and so, whatever. As the old men in the group die out they are having trouble finding new blood. No kidding guys! the millenniums and Xers are smarter about  current investment opportunities.

To carry on about Thinking In Bets, the one thing Annie says can counteract one person's psychological limits is what she calls a "decision pod."  In her case, it's a group of professional gamblers she respects, who she works through her strategy and results with.

I see a direct correlation between that and an investment club:  not to drive results for the club, which like your husband's is relatively small.  But exactly to learn how to so it, and apply those lessons to your portfolio.  Not just any group will do, though.  One that follows thorough honesty and transparency will help.  A group just getting together to BS can simply become an echo chamber.

There are public investment clubs that have multi-decade track records of beating the market CAGR by 5% or more.

Villanelle

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Re: How to ignore stock pickers within your social circle
« Reply #34 on: January 10, 2023, 09:47:45 AM »
Why do you feel the need to compare investment strategies? Do you whip out wangs and see whose is larger?

I don’t, they do though, if this stock goes up I get texts etc… but yes the people who send me this are the comparing type.

It originally went along the type of “you should buy this stock etc” and I say I don’t do that as I don’t think the data suggests it will work long term so I index “ type thing

This opens the door for comparison and conversation.  It's you saying you are probably right an they are probably wrong, so the leap to wanting to prove you are incorrect is a very small one.  Don't try to convince them that you are right in some concrete, empirical, universal way.  Because then they will do the same.  Tell them your approach works best *FOR YOU* and you plan to stick with it.  If you try to prove a point and offer advice they didn't ask for (even if they opened the door), then they are going to do the same.  So don't comment on their strategies at all.  And comment on your own only in the sense that it is best for you.  (I like not having to think about investing too much, or I would be too stressed during a down market, or something like that. It's about YOU, not about your strategy being The Best One.)

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Re: How to ignore stock pickers within your social circle
« Reply #35 on: January 10, 2023, 09:48:13 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.

True, but while that behaviour is found in all ages and genders, it certainly manifests itself in distinct ways in particular groups

mistymoney

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Re: How to ignore stock pickers within your social circle
« Reply #36 on: January 10, 2023, 10:00:24 AM »
Are you really looking for consoling voices, or trying to influence their behaviour and make their presence more comfortable for you?

For kindred voices, read The Little Book of Commonsense Investing, by Jack Bogle, and Thinking In Bets by Annie Duke.  Jack's book, of course, talks about indexing, and makes the case for it vs. actively-managed mutual funds.  Annie's book is all about identifying skill vs. luck.  She advocates against "resulting": mistaking the end result as deserved, whether good or bad.

“Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.” --Joel Greenblatt

Yes I am, I am not sure why you presume to think I am trying to influence them when it is clear I am pointing to the opposite behaviour happening. Ever been in a position where you are almost forced and pressured to justify your position?

I actually enjoy the opposite point of view as long as its objective but increasingly it feels more like I am being laughed at for indexing and will get so much worse if the stock actually goes back to where it was. Perhaps I need to just re-evaluate and never get into any discussion on it without being rude or dismissive. It would actually be a waste of time trying to influence as decisions have been made. I notice one learning from it though, which puts me off stock picking completely, once they buy into it, it becomes almost cult like in their thinking, no objectivity the stock HAS to go up, there is no way it can stay down!. I get it, it could be life changing for them if it does go that way, or perhaps not as I get the feeling if this even goes up then it will be onto the next "winner" which could have the opposite result.

I guess I do not have much constructive points back regarding individual stocks as it always seemed like a no brainer not to do it for me, too much risk and sleepless nights worrying about it for me, but others seem on the surface at least, different. Watching WBs bet against Hedge Funds play out sealed it for me also.

I think this is too easy really. Just tell them you index invest because you don't enjoy researching or talking about individual investments. When they text about it, don't reply. When they discuss, don't join in or if pushed just say - glad you enjoy that! and change to another topic.

like if they were all crazy over golfing every weekend and you weren't interested in the slightest. Act like that.

iris lily

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Re: How to ignore stock pickers within your social circle
« Reply #37 on: January 10, 2023, 10:05:10 AM »
As the old men in the group die out they are having trouble finding new blood, no kidding, the millenniums and Xers are smarter with current investment opportunities.

Unfortunately I don't see this being the case - just look at all the 'crytobros' and all the folks over on RobinHood and on stock-picking treads on Reddit - Overwhelmingly people under 50, overwhelmingly men. They have more information at their fingertips than any generation previously, and so they've convinced themselves the they can do better with that information than index funds (after all, there must be 'inefficiencies' one can exploit, right?)

I don't think overestimating your ability to be above average is a characteristic limited to any one particular cohort.
I do: it's men. Oh wait, I'm a man.

I’m not going to man bash, but I will have to say that in my household not only do I have a stock picker, but my spouse also insists on keeping much of our investments with brokers. Yes it is true. I confess it here on the MMM site. Don’t facepunch me! I know it is wrong.

But I’m fine with it, I have my own IRA in Vanguard.

One of the brokers wants to meet with us quarterly, and I have gone to one of those meetings but no longer since it is a waste of my time. One time I did go the boys were sitting there talking about the market blah blah blah, and I was just humming a little tune to myself and my little tune was “index funds index funds dollar cost average your index funds. “

Somewhere along the way I remember one of these guys looking at me deeply and sincerely asking me “don’t you want to do better than the market” and I deeply and sincerely do not want to do better than the market, I just wanna do what the market does.

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #38 on: January 10, 2023, 10:09:56 AM »
Are you really looking for consoling voices, or trying to influence their behaviour and make their presence more comfortable for you?

For kindred voices, read The Little Book of Commonsense Investing, by Jack Bogle, and Thinking In Bets by Annie Duke.  Jack's book, of course, talks about indexing, and makes the case for it vs. actively-managed mutual funds.  Annie's book is all about identifying skill vs. luck.  She advocates against "resulting": mistaking the end result as deserved, whether good or bad.

“Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.” --Joel Greenblatt

Yes I am, I am not sure why you presume to think I am trying to influence them when it is clear I am pointing to the opposite behaviour happening. Ever been in a position where you are almost forced and pressured to justify your position?

I actually enjoy the opposite point of view as long as its objective but increasingly it feels more like I am being laughed at for indexing and will get so much worse if the stock actually goes back to where it was. Perhaps I need to just re-evaluate and never get into any discussion on it without being rude or dismissive. It would actually be a waste of time trying to influence as decisions have been made. I notice one learning from it though, which puts me off stock picking completely, once they buy into it, it becomes almost cult like in their thinking, no objectivity the stock HAS to go up, there is no way it can stay down!. I get it, it could be life changing for them if it does go that way, or perhaps not as I get the feeling if this even goes up then it will be onto the next "winner" which could have the opposite result.

I guess I do not have much constructive points back regarding individual stocks as it always seemed like a no brainer not to do it for me, too much risk and sleepless nights worrying about it for me, but others seem on the surface at least, different. Watching WBs bet against Hedge Funds play out sealed it for me also.

I think this is too easy really. Just tell them you index invest because you don't enjoy researching or talking about individual investments. When they text about it, don't reply. When they discuss, don't join in or if pushed just say - glad you enjoy that! and change to another topic.

like if they were all crazy over golfing every weekend and you weren't interested in the slightest. Act like that.

you are right, I get sucked in too easily, its tough because I do like investing as a topic but for me, when I looked it into it, stock picking is like a rich boys network and im not rich, so I feel like I cannot play in that field anyhow even if I wanted. I also don't have big sums just lying around that you can use to pounce on the right opportunity at the right time.

This is why people end up using leverage to try their luck with it, as they are not rich enough to play the stockpicking game. I think I would prefer to be the Hedge fund taking the fee than the stock picker taking all the risk!

MustacheAndaHalf

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Re: How to ignore stock pickers within your social circle
« Reply #39 on: January 10, 2023, 10:17:23 AM »
I'd make the same recommendation to you and to them: you need "A Random Walk Down Wall Street", which just came out with the 50th anniversery edition last week.  I've found editions at every library where I looked, but I haven't tried small towns.
https://www.amazon.com/Random-Walk-Down-Wall-Street-dp-1324051132/dp/1324051132/

The book does two things: lays out the case carefully, and backs all of it up with historical data.  The book has been published every several years for 50 years - they update the data, and the investment thesis still holds.  Your friends will not have 50 years of outperformance.

You can also look at "SPIVA reports", which track how many active mutual funds beat their index.  For example, how many large cap funds can't pull ahead of the S&P 500?  The number gets higher over time, pushing above 80% over a decade (from memory).  You could print out the key page of that report, and show that to your friends.  They may be investing for just a single year, but your plan is to invest for decades, right?

I think "A Random Walk Down Wall Street" and SPIVA reports can give your confidence a boost, and help you "stay the course" as John Bogle used to say.

SPM87

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Re: How to ignore stock pickers within your social circle
« Reply #40 on: January 10, 2023, 10:29:55 AM »
I'd make the same recommendation to you and to them: you need "A Random Walk Down Wall Street", which just came out with the 50th anniversery edition last week.  I've found editions at every library where I looked, but I haven't tried small towns.
https://www.amazon.com/Random-Walk-Down-Wall-Street-dp-1324051132/dp/1324051132/

The book does two things: lays out the case carefully, and backs all of it up with historical data.  The book has been published every several years for 50 years - they update the data, and the investment thesis still holds.  Your friends will not have 50 years of outperformance.

You can also look at "SPIVA reports", which track how many active mutual funds beat their index.  For example, how many large cap funds can't pull ahead of the S&P 500?  The number gets higher over time, pushing above 80% over a decade (from memory).  You could print out the key page of that report, and show that to your friends.  They may be investing for just a single year, but your plan is to invest for decades, right?

I think "A Random Walk Down Wall Street" and SPIVA reports can give your confidence a boost, and help you "stay the course" as John Bogle used to say.

I think its good for me, but the others wont look at it lol. They think they are the above average guy who should get more than the average market return, I think the theory of one them is you only need to be right once and not have to beat it over time. For example if poly goes back to where it was pre-war, one of them is looking at millionaire level. Some are in a rush to get there faster and see this as the golden goose for them. Not sure how realistic that is, to be an in out one time only, feels like the same theory of the casino, ill get up and get out, when nobody ever does

iris lily

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Re: How to ignore stock pickers within your social circle
« Reply #41 on: January 10, 2023, 11:26:02 AM »
I'd make the same recommendation to you and to them: you need "A Random Walk Down Wall Street", which just came out with the 50th anniversery edition last week.  I've found editions at every library where I looked, but I haven't tried small towns.
https://www.amazon.com/Random-Walk-Down-Wall-Street-dp-1324051132/dp/1324051132/

The book does two things: lays out the case carefully, and backs all of it up with historical data.  The book has been published every several years for 50 years - they update the data, and the investment thesis still holds.  Your friends will not have 50 years of outperformance.

You can also look at "SPIVA reports", which track how many active mutual funds beat their index.  For example, how many large cap funds can't pull ahead of the S&P 500?  The number gets higher over time, pushing above 80% over a decade (from memory).  You could print out the key page of that report, and show that to your friends.  They may be investing for just a single year, but your plan is to invest for decades, right?

I think "A Random Walk Down Wall Street" and SPIVA reports can give your confidence a boost, and help you "stay the course" as John Bogle used to say.

But see, they arent going to read a book. They just aren’t.

I was happy when my friend moved her investments to Vanguard after “doing research” on index funds as being the way to go. This followed several discussions where I had mentioned casually  what I would do with all of our money if I had 100% of the decision making power and yeah, that was index funds. But people need to hear facts a few times and be ready to absorb them before they act.

So i mentioned “ congratulations on coming over to the Boglehead side” but unfortunately, when the market tanked in 2008 she pulled out a lot if it. She didnt carry through the entire John Bogle philosophy. She put some money back in to the index funds, and is now pulling it out again.

Sigh.

She also did not take full advantage of her company’s matching funds, that free money.


MustacheAndaHalf

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Re: How to ignore stock pickers within your social circle
« Reply #42 on: January 11, 2023, 04:21:22 AM »
I'd make the same recommendation to you and to them: you need "A Random Walk Down Wall Street", which just came out with the 50th anniversery edition last week.  I've found editions at every library where I looked, but I haven't tried small towns.
https://www.amazon.com/Random-Walk-Down-Wall-Street-dp-1324051132/dp/1324051132/

The book does two things: lays out the case carefully, and backs all of it up with historical data.  The book has been published every several years for 50 years - they update the data, and the investment thesis still holds.  Your friends will not have 50 years of outperformance.

You can also look at "SPIVA reports", which track how many active mutual funds beat their index.  For example, how many large cap funds can't pull ahead of the S&P 500?  The number gets higher over time, pushing above 80% over a decade (from memory).  You could print out the key page of that report, and show that to your friends.  They may be investing for just a single year, but your plan is to invest for decades, right?

I think "A Random Walk Down Wall Street" and SPIVA reports can give your confidence a boost, and help you "stay the course" as John Bogle used to say.

I think its good for me, but the others wont look at it lol. They think they are the above average guy who should get more than the average market return, I think the theory of one them is you only need to be right once and not have to beat it over time. For example if poly goes back to where it was pre-war, one of them is looking at millionaire level. Some are in a rush to get there faster and see this as the golden goose for them. Not sure how realistic that is, to be an in out one time only, feels like the same theory of the casino, ill get up and get out, when nobody ever does
What about my second suggestion?

Print out page 10 of the end of year 2021 SPIVA report, and put that in their faces - just as they put their ideas into yours.  "Look at that, 75% underperformed after 5 years, but 90% underperformed over 20 years."
https://www.spglobal.com/spdji/en/documents/spiva/spiva-us-year-end-2021.pdf#page=10

MustacheAndaHalf

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Re: How to ignore stock pickers within your social circle
« Reply #43 on: January 11, 2023, 04:28:50 AM »
I'd make the same recommendation to you and to them: you need "A Random Walk Down Wall Street", which just came out with the 50th anniversery edition last week.  I've found editions at every library where I looked, but I haven't tried small towns.
https://www.amazon.com/Random-Walk-Down-Wall-Street-dp-1324051132/dp/1324051132/

The book does two things: lays out the case carefully, and backs all of it up with historical data.  The book has been published every several years for 50 years - they update the data, and the investment thesis still holds.  Your friends will not have 50 years of outperformance.

You can also look at "SPIVA reports", which track how many active mutual funds beat their index.  For example, how many large cap funds can't pull ahead of the S&P 500?  The number gets higher over time, pushing above 80% over a decade (from memory).  You could print out the key page of that report, and show that to your friends.  They may be investing for just a single year, but your plan is to invest for decades, right?

I think "A Random Walk Down Wall Street" and SPIVA reports can give your confidence a boost, and help you "stay the course" as John Bogle used to say.

But see, they arent going to read a book. They just aren’t.

I was happy when my friend moved her investments to Vanguard after “doing research” on index funds as being the way to go. This followed several discussions where I had mentioned casually  what I would do with all of our money if I had 100% of the decision making power and yeah, that was index funds. But people need to hear facts a few times and be ready to absorb them before they act.

So i mentioned “ congratulations on coming over to the Boglehead side” but unfortunately, when the market tanked in 2008 she pulled out a lot if it. She didnt carry through the entire John Bogle philosophy. She put some money back in to the index funds, and is now pulling it out again.

Sigh.

She also did not take full advantage of her company’s matching funds, that free money.
I also mentioned SPIVA reports, although it seems everyone skipped over that, so I provided a link to make the suggestion more actionable.
https://www.spglobal.com/spdji/en/documents/spiva/spiva-us-year-end-2021.pdf#page=10

I have a theory that people who don't read "A Random Walk Down Wall Street" have less conviction that passive investing works.  They treat it as an idea they heard, which will change once they hear something else.  I think the historical performance is vital to the idea, as it shows the approach has stood the test of time.  Everyone knows about passive investing, but it still works.  That's another reason I included the SPIVA report, which features data going back various lengths of time, and showing active fund underperformance.

There's a flip side to this argument, too: 2022 and 2008 were bad years for indexing, with it being a coin flip in those individual years.  Half the active funds beat the index.  So if someone was going to pick stocks or active funds, a crash year isn't a  bad time to do it - but that offer expires when the recovery starts, which can happen very quickly.  Which is what I need to watch out for, since I'm actually investing actively for now (for as long as I beat the S&P 500 by double digits, using broad bearish investments... "sell and hold cash", I guess)

mistymoney

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Re: How to ignore stock pickers within your social circle
« Reply #44 on: January 11, 2023, 08:46:28 AM »
Are you really looking for consoling voices, or trying to influence their behaviour and make their presence more comfortable for you?

For kindred voices, read The Little Book of Commonsense Investing, by Jack Bogle, and Thinking In Bets by Annie Duke.  Jack's book, of course, talks about indexing, and makes the case for it vs. actively-managed mutual funds.  Annie's book is all about identifying skill vs. luck.  She advocates against "resulting": mistaking the end result as deserved, whether good or bad.

“Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.” --Joel Greenblatt

Yes I am, I am not sure why you presume to think I am trying to influence them when it is clear I am pointing to the opposite behaviour happening. Ever been in a position where you are almost forced and pressured to justify your position?

I actually enjoy the opposite point of view as long as its objective but increasingly it feels more like I am being laughed at for indexing and will get so much worse if the stock actually goes back to where it was. Perhaps I need to just re-evaluate and never get into any discussion on it without being rude or dismissive. It would actually be a waste of time trying to influence as decisions have been made. I notice one learning from it though, which puts me off stock picking completely, once they buy into it, it becomes almost cult like in their thinking, no objectivity the stock HAS to go up, there is no way it can stay down!. I get it, it could be life changing for them if it does go that way, or perhaps not as I get the feeling if this even goes up then it will be onto the next "winner" which could have the opposite result.

I guess I do not have much constructive points back regarding individual stocks as it always seemed like a no brainer not to do it for me, too much risk and sleepless nights worrying about it for me, but others seem on the surface at least, different. Watching WBs bet against Hedge Funds play out sealed it for me also.

I think this is too easy really. Just tell them you index invest because you don't enjoy researching or talking about individual investments. When they text about it, don't reply. When they discuss, don't join in or if pushed just say - glad you enjoy that! and change to another topic.

like if they were all crazy over golfing every weekend and you weren't interested in the slightest. Act like that.

you are right, I get sucked in too easily, its tough because I do like investing as a topic but for me, when I looked it into it, stock picking is like a rich boys network and im not rich, so I feel like I cannot play in that field anyhow even if I wanted. I also don't have big sums just lying around that you can use to pounce on the right opportunity at the right time.

This is why people end up using leverage to try their luck with it, as they are not rich enough to play the stockpicking game. I think I would prefer to be the Hedge fund taking the fee than the stock picker taking all the risk!

well, if you want to! These days it is easy to invest just a few hundred dollars, or even a lot less! into individual stocks. I remember when a limit order cost $11 on scotttrade, so if you only bought $100 worth, that was an 11% expense fee out of the gate. Those days are gone! If these are things you would like to participate in, just for fun, and the share price is low, you could easily pick up a few shares for $50 and participate in the convos as an active participant. You wouldn't even need to say how few you bought if you didn't want to get into it!

Heckler

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Re: How to ignore stock pickers within your social circle
« Reply #45 on: January 11, 2023, 09:40:59 PM »
It's the crypto bros that are way more fun to watch

I had a crypto bro run into the big city to go buy hard silver when it all went down.  It was tough to watch and say nothing.

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Re: How to ignore stock pickers within your social circle
« Reply #46 on: February 06, 2023, 10:12:10 AM »
I give them reference of John Bogle and Warren Buffett newsletter

patchyfacialhair

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Re: How to ignore stock pickers within your social circle
« Reply #47 on: February 06, 2023, 01:04:36 PM »
Meh, I just feign ignorance with most people. "I got daycare and private school bills and work...it's tough out there no matter what you do."

Nobody needs to know that I have extra money much less how I invest it.

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Re: How to ignore stock pickers within your social circle
« Reply #48 on: February 06, 2023, 01:33:59 PM »
Meh, I just feign ignorance with most people. "I got daycare and private school bills and work...it's tough out there no matter what you do."

Nobody needs to know that I have extra money much less how I invest it.

I like this approach and sort of take it with some folks. I have a friend who almost sees the light, but still makes some weird decisions. He would faint if he knew our monthly taxable investment additions were more than his monthly gross pay. I just gently prod him about "make sure you run the numbers and check your work."

mistymoney

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Re: How to ignore stock pickers within your social circle
« Reply #49 on: February 06, 2023, 01:39:11 PM »
Meh, I just feign ignorance with most people. "I got daycare and private school bills and work...it's tough out there no matter what you do."

Nobody needs to know that I have extra money much less how I invest it.

that is a pov! when I was younger, had a lot more converations about these kinds of things, after a while you realize that everyone has access to the same info and same options and not everyone will want to think about things like individual stocks, etc.

and then money in general is a whole nother thing. Who has what, salary, NW, etc. overall best to not know too much about others and vice versa. A lot of relationships end or deteriorate due to comparisons (on money and other things too I am sure!) and thinking what others should do with their money (tip more, pick up the check more, contribute to gofundmes, give better gifts, participate in more things, etc. etc.) that if you didn't know anything but they were getting by, wouldn't have....

then again....maybe who needs those friends?

 

Wow, a phone plan for fifteen bucks!