Should the forum have a separate area for active investing?

[MustacheAndaHalf]

WTF @MustacheAndaHalf ... and then you have a tantrum and argue with anyone whose opinion is different.

Not that you would ever be able to see past your own nitpicking and arguing to see it.

I've repoted you for repeatedly violating the rule
"2. Attack an argument, not a person."

https://forum.mrmoneymustache.com/forum-information-faqs/forum-rules/

[BeanCounter]

WTF @MustacheAndaHalf ... and then you have a tantrum and argue with anyone whose opinion is different.

Not that you would ever be able to see past your own nitpicking and arguing to see it.

I've repoted you for repeatedly violating the rule
"2. Attack an argument, not a person."

https://forum.mrmoneymustache.com/forum-information-faqs/forum-rules/

Perfect!
Saw you doing that to other posters in the crypto thread. I’d welcome a moderator to review your posts.
It’s comical.
Edited to add- the above isn’t an attack it’s just calling out your behavior on this forum.

[nereo]

Joining this thread a bit late, but my opinion is “no,” Presently that is the majority opinion with >80%

Others have covered many of the central reasons why we should keep things as is, so I do not need to rehash them here. I do not believe the forum would be improved by segregating posts into “active” vs “passive” and then micromanaging where the definitive line is with “active” (e.g. buying bonds, market timing into indexes, selection of AA).

[Paper Chaser]

I think there's some sort of confirmation/survivorship bias going on here. The reason that 40% of posts in this section are related to active investing is that having a bunch of "Welp, added a few more shekels into my passive index again this week" would be even more boring than discussions about active investing (which are also boring, but at least there might be some drama). Passive investing is boring and rote. That's what's so great about it. It's the "set it and forget it" approach to reaching FI. It's also the most viable path for most people to achieve financial independence without doing a bunch of work and adding stress to their lives.

Two foundational aspects of the MMM gospel are reducing work at things that aren't "worth it" to a person, and to remove stress related to money. These are keystone elements of this whole place. Obviously, a person that enjoys active investing is going to value it differently and be stressed by it differently than a normal human being :), but for most people active investing does not align with the goals of doing less work or reducing stress about money.

I also think that there are contributors here at just about any stage of life, and we don't know the specific circumstances of any of them unless they tell us. So there's a difference between a person that's hit FI and is financially secure discussing playing with active investments as a hobby that they enjoy, compared to somebody just laying the foundation of their financial life doing it trying to build wealth. If that's not clarified, then you'll get newbies taking risks that may not align with their own risk tolerance or the general ideologies of MMM.

We're not necessarily here to make as much money as possible as quickly as possible. We're here to build wealth in a stress free way so that we can focus our energies on things that are more meaningful to us. Passive investing does that for most, while active does not. If you like active, and are in a spot in life where you can do it with minimal risk to your overall well being that's fine, but you might want to put a disclaimer or something in the post so that people understand a bit more about your situation, what you value about active investing, and why it may/may not work for other people in other situations with other values.

[lifeanon269]

1) The MMM forum itself has no ads, no endorsement deals, no affiliates

Tell me you haven't scrolled to the bottom of these forums without telling me you haven't scrolled to the bottom.  ;)

[ChpBstrd]

1) The MMM forum itself has no ads, no endorsement deals, no affiliates

Tell me you haven't scrolled to the bottom of these forums without telling me you haven't scrolled to the bottom.  ;)

There's a bottom? I'm only interested in where the top is in.

[simonsez]

We're not necessarily here to make as much money as possible as quickly as possible. We're here to build wealth in a stress free way so that we can focus our energies on things that are more meaningful to us. Passive investing does that for most, while active does not. If you like active, and are in a spot in life where you can do it with minimal risk to your overall well being that's fine, but you might want to put a disclaimer or something in the post so that people understand a bit more about your situation, what you value about active investing, and why it may/may not work for other people in other situations with other values.

Yup!  Life is too short for _____.  For many people, after they have their head screwed on correctly as an adult and know the life they want to pursue and have done the minimum required reading/experiencing in a few areas to be able to succeed, they fill in the blank with active investing or it could be climbing the corporate ladder or staying in a toxic relationship or anything really.  For me, it's no slight to active investing, I'd just rather spend my free time gardening, traveling, playing games, floating in a body of water with a beverage, exercising, socializing, etc.  I do a fair bit of leisure reading and one of the topics on occasion is investing, but it's just not at a level where it's going to fundamentally shift my IPS - at least not at this point in life.  But I still like reading the Cliffnotes versions of what people are doing in this space (i.e. all the different flavors to investing).  The majority of investors can't beat benchmarks over medium to long term horizons.  I put myself in that group and am okay with my plans to get there steadily.  I'm not someone who HAS to retire in their 30s or they feel like a FIRE failure either.  My race is being won in a way that works for me.  I'm glad the default in this corner of the internet seems to be "buy and hold index funds" rather than "I have no clue so I'll just go to the family Edward Jones guy."  That's an improvement! 

If there are those that want to share their strategies regarding investing, we have the Investor Alley.  I happily peruse the wide variety of philosophies and plans/goals discussed and feel I'm receiving an ongoing financial education.  If investing was split up further, I'm not sure what is gained other than to create an echo chamber.  The words "active" and "passive" are a bit ambiguous and nebulous with respect to investing and are rarely black and white - more of a continuum.  I like seeing different parts of the continuum under the same umbrella. 

MMM's approach to life/career/finances was not conventional.  He had to live it and back it up with numbers.  He did that.  People respected his approach and here we are.  I feel it's similar with the investing.  Active investing is not conventional in this space.  If you're an active person and want to discuss your strategies, you need to back them up (which you definitely do M1.5). 

I do wish more forum beginners would read the stickies as well as place topics in the appropriate spot.

[Financial.Velociraptor]

@MustacheAndaHalf

As one of the active investing "heretics", I've come to the conclusion the forum is fine as it is.  Yes, posting about active investing draws some flak.  If you are that easily distracted from your analysis and especially if you become emotional about your style that easily, you are being done a favor if you get driven away from active investing.  It takes a certain magic art of steely determination married to head on a swivel flexibility to do well.  A thick skin is also recommended.

Also, I consider my active investing to NOT be about beating the market.  (Suppose that makes me a DOUBLE heretic).  My active stuff (excess profits [if, not when] thereof go into largely passive fixed and hybrid income investments) is in options.  My opinion only; doing options "right" means trailing the market average with LOWER RISK.  That is, my only hope of 'beating the market' is on a Risk Adjusted Basis.  I need to maintain wealth at this point and only grow it a little to keep ahead of inflation.  At least until social security age when the equation changes considerably.  That is, I have to agree with passive investors that bemoan active investors who seek to "beat the market".  That is ENORMOUSLY difficult and not what options are intended to do. 

You had a really good run with your "experiment" that in my opinion was more than pure luck.  Well done!  I thought the thesis was sound, your approach was diversified, and your position size was well considered. If a retail trader can beat the market, that is how they should do so.  For active Investing (note the difference between active Trading), the winning strategy is often to buy what is cheap and hated but has very long term advantages that are temporarily out of favor and then holding for decades.  Warren Buffet, Charlie Munger, and their lieutenants do this very well.  (Aside, a long term investor can "time" certain sectors such as Finance, Insurance, Real-Estate [the other FIRE], commodities investing, and long payback period investments like mining, forestry, and productive farmland with deep study and patience.  100x or more returns across a 30-70 year cycles is not unheard of and used successfully by many Family Offices and University Endowments.) 

Finally, since I went FIRE on 5OCT2012, I have had about a dozen friends, family members, and even just acquaintances ask me for advice on how to invest.  After sitting them down and exploring their knowledge, motivations, goals, and especially risk tolerances, I told ALL BUT ONE to passively index.  The one, my father (who had a ZERO risk tolerance "it is everything I worked for all my life!") was directed to FDIC insured bank CDs and a single premium insurance annuity that is RMD compliant for his tIRA.  In my experience, active investing is ultimately not for most people.  I know a few investors who are competent and enjoy it. I know more traders who are real TA wizards.  All of them, including me (not one of the wizards!) include a passive component that is meant to be grown over time.  So even for those who want to be active, they need some passive "ballast".

I vote leave it alone.

[MustacheAndaHalf]

@MustacheAndaHalf

As one of the active investing "heretics", I've come to the conclusion the forum is fine as it is.  Yes, posting about active investing draws some flak.  If you are that easily distracted from your analysis and especially if you become emotional about your style that easily, you are being done a favor if you get driven away from active investing.  It takes a certain magic art of steely determination married to head on a swivel flexibility to do well.  A thick skin is also recommended.

Also, I consider my active investing to NOT be about beating the market.  (Suppose that makes me a DOUBLE heretic).  My active stuff (excess profits [if, not when] thereof go into largely passive fixed and hybrid income investments) is in options.  My opinion only; doing options "right" means trailing the market average with LOWER RISK.  That is, my only hope of 'beating the market' is on a Risk Adjusted Basis.  I need to maintain wealth at this point and only grow it a little to keep ahead of inflation.  At least until social security age when the equation changes considerably.  That is, I have to agree with passive investors that bemoan active investors who seek to "beat the market".  That is ENORMOUSLY difficult and not what options are intended to do. 

You had a really good run with your "experiment" that in my opinion was more than pure luck.  Well done!  I thought the thesis was sound, your approach was diversified, and your position size was well considered. If a retail trader can beat the market, that is how they should do so.  For active Investing (note the difference between active Trading), the winning strategy is often to buy what is cheap and hated but has very long term advantages that are temporarily out of favor and then holding for decades.  Warren Buffet, Charlie Munger, and their lieutenants do this very well.  (Aside, a long term investor can "time" certain sectors such as Finance, Insurance, Real-Estate [the other FIRE], commodities investing, and long payback period investments like mining, forestry, and productive farmland with deep study and patience.  100x or more returns across a 30-70 year cycles is not unheard of and used successfully by many Family Offices and University Endowments.) 

Finally, since I went FIRE on 5OCT2012, I have had about a dozen friends, family members, and even just acquaintances ask me for advice on how to invest.  After sitting them down and exploring their knowledge, motivations, goals, and especially risk tolerances, I told ALL BUT ONE to passively index.  The one, my father (who had a ZERO risk tolerance "it is everything I worked for all my life!") was directed to FDIC insured bank CDs and a single premium insurance annuity that is RMD compliant for his tIRA.  In my experience, active investing is ultimately not for most people.  I know a few investors who are competent and enjoy it. I know more traders who are real TA wizards.  All of them, including me (not one of the wizards!) include a passive component that is meant to be grown over time.  So even for those who want to be active, they need some passive "ballast".

I vote leave it alone.

If this were reddit, I'd quote you saying "A thick skin is recommended" and then say "username checks out".

I want 1:1 conversations with knowledgeable active investors, which you might call investment alpha.  Active investors need to produce alpha in excess of fees, and in these forums distraction and noise are the fees.  I could certainly try to minimize fees, but recently I'm questioning if there's any alpha in Investor Alley.

I was listening to Robert Schiller's 2011 courses (2 years before he won the nobel prize), and came across a guest lecture by Yale Endowment portfolio manager David Swensen.  Yale woke up all University Endowments by blowing their performance out of the water, and with a lower allocation to U.S. equities.  You might find ideas about dispersion of returns interesting.
https://www.youtube.com/watch?v=wRdx7kVNQ_E&list=PL8FB14A2200B87185&index=6

If your TA friends were on a forum discussing day trading, they might invest for minutes where I invest for months.  I'm doing something closer to contrarian macro investing.  I guess I need to find a group of grumpy older investors waiting for a crash - the classic bear investor.

Ultimately we agree most people should invest passively.  They could even follow what I did, which is spend the first 20 investing years in low cost passive index funds.

[nereo]

@MustacheAndaHalf - given what you have said above and the current tilt of this sub-forum towards active investing as outlined by others, how would your proposal to clearly cleave the Investor Alley improve the situation?

It’s still not clear to me how sandboxing will drive traffic or focus discussion more to your liking.

[Herbert Derp]

I've been posting about active investing in this subforum for over a year now and I didn't feel like anyone was making me feel unwelcome. I have had a lot of great discussions! I don't see any need for another subforum, what even is there to talk about in terms of passive investing? VTASX vs VTI vs FZROX? Asset allocation? There's not really much to talk about and I feel like a passive investing subforum would be a ghost town.

[TomTX]

No, we do not need another subforum.

[bthewalls]

My goodness, I just read through all the previous....nearly bent double laughing. Don’t things get out of shape quick here.

Life is hard when I don’t get my way lol.....democracy?