Let's talk about investing! Stock market, ETF, etc.

[TheGreatBuzz]

11 minutes ago, Nerm said:

The philosophy the company was founded on was to keep costs low by focusing on long term index fund investing rather than trying to beat/time the market.  I would guess there are better options for the recreational/gambling types of investing.

 

I noticed under their mutual fund tab, they mention doing more than 2 a month.  Their stock section doesn’t say anything.  I was thinking if I have enough money in other funds there, would I get the free trades on stocks, etc.  Their site doesn’t say anything for/against.

[Corcaigh]

There’s a lot to consider, not knowing existing retirement accounts and savings and the mix.

 

Whether to use a Roth IRA or IRA for money you don’t need until you are 59.5, whether your wife has access to other tax advantaged accounts and are you taking maximum benefit from that, especially if there is an employer match in play.

 

You want to think about the mix of stocks and bonds you are comfortable with across ALL your retirement and non-retirement savings (your ALLOCATION), and then your LOCATION ... how those stocks and bonds are distributed within your taxable and tax-advantaged accounts. You typically would want the bond portion to be in tax-advantaged accounts as they spit out dividends each year that are treated as ordinary income, where as the long term-capital gains that stocks will return are more favorably taxed.

If you don’t need the money for 15 years then a pretty aggressive allocation to stocks would be recommended if you are comfortable with the risk. which the 2035 fund‘s 75/25 allocation represents. The LifeStrategy Growth Fund with its 80/20 allocation would be a decent choice too.

For this type of fund you can make regular automatic investments and the firm would rebalance it to keep the desired allocation.

 

 

 

Edited February 18, 2021 by Corcaigh

[TheGreatBuzz]

12 minutes ago, Corcaigh said:

Whether to use a Roth IRA or IRA for money you don’t need until you are 59.5, whether your wife has access to other tax advantaged accounts and are you taking maximum benefit from that, especially if there is an employer match in play.

 

There is a lot of good-sounding advice in your post.  Some of it I even understood.  

 

We have my military pension check.  She has a Roth 401K that we max out per year and her company kicks in a pretty good match.  Other than that, we have money just sitting in a bank account earning .4%.  

 

EDIT:  Oh, and I like the idea of a plan that manages itself because I have no idea what a lot of the other things that go into are.

Edited February 18, 2021 by TheGreatBuzz

[techboy]

3 hours ago, TheGreatBuzz said:

So I’ve been doing some research and stuff and like the idea of a “set it and forget it” type of account.  I’m pretty risk adverse but also know I want my money to make more than just the .4% it gets sitting in a money market.  I’m thinking the 2035-fund makes sense for us not because that is when we will retire (we’ll be mid-50’s in 2035) but we will at least be wanting to really start settling down then.  So should we open an account and drop $50K in there and just not look until 2035?  Also, with that type of fund, can I set a monthly allotment to add to it or would I have to go in and “buy” more each time?

 

Also, if we wanted to set aside other money (maybe a couple grand) to just gamble with Draft-Kings style, is that something else that would be good to do with Vanguard?

 

@Corcaighgave you some pretty good advice, though again, you can probably get much more thorough and detailed feedback on the Bogleheads forum using the "asking a question" guide I linked... There are a lot of people there that will spend a lot of time getting into the nitty gritty with you and helping you figure out exactly what you want to do.

 

That being noted, yes, that sounds like a reasonable plan, given the limited information given. The best way to use those target funds is to determine what asset allocation you want, then pick one that matches it, or is at least close. Everyone has different need, ability, and willingness to take risk, so what you're really looking at is the percentage of stocks. If the 2035 matches what you want to do, it's a perfectly fine vehicle to do it, particularly if you want to "set it and forget it". That kind of fund automatically rebalances daily and will slowly glide the percentage of stocks down... if you want to see what it will look like in 2035, take a look at their fund for new retirees, or the 2025 version. And yes, they will absolutely take your money monthly.

 

Picking your need, ability, and willingness to take risk is the tricky part, though. As an example, you have a pension, which ironically makes you much more able to take risk, since you have that to fall back on. On the other hand, that means you don't really NEED to take risk, because you don't need bigger returns to fund your retirement, and you've said you're risk adverse, so maybe you don't really want to take risk anyway.

 

Picking that balance is complicated, and a personal decision, but the short version is that a heavier allocation to stocks is more risky, and a heavier allocation to bonds is safer. You can figure that out by adding up the percentages in the funds, but you'll notice that the bigger years have more stocks (up to 90/10 stocks/bonds if I remember correctly), which glides down to 50/50 or even 40/60 for retirees.

 

There are a lot of considerations, though (taxation is one that @Corcaighis spot on about).

[TheGreatBuzz]

@techboy  Thanks.  I looked at that Bogleheads forum by kinda felt like a lot of it was over my head.  I get what you are saying though.  I guess my real issue is I want zero risk with a guaranteed high rate of return.  I’m starting to think that isn’t a thing.  I’ve just really never been in this kind of position before with having more money than I really know what to do with.  I want to be smart with it.  And I already have enough toys.

[techboy]

12 minutes ago, TheGreatBuzz said:

@techboy  Thanks.  I looked at that Bogleheads forum by kinda felt like a lot of it was over my head.  I get what you are saying though.  I guess my real issue is I want zero risk with a guaranteed high rate of return.  I’m starting to think that isn’t a thing.  I’ve just really never been in this kind of position before with having more money than I really know what to do with.  I want to be smart with it.  And I already have enough toys.

 

Yeah, the return on investing is at its core being compensated for taking risk, so you're not going to find zero risk with a high rate of return.

 

Think about it this way... If the US government offered a bond that paid 10% and it was backed by the full faith and credit of said government (the real world stand in for zero risk), it'd be snapped up in a heartbeat.

 

Except someone else would accept 9.9%. And so on, down until the risk/reward profile doesn't make sense any more.

 

The same thing is true of stocks, in a slightly different mechanism. There is no free lunch.

 

Don't be intimidated by Bogleheads... They're quite gentle with newbies. They also have pretty strict moderation maintaining that genial climate. If you give them the info, they'll help you make a plan.

 

I'd be willing to help you too, if you want, but without the crowd sourcing of text responses, it'd probably need to be a phone call or something, to say nothing of the desire not to hijack this thread, which is about "investing".

 

 

[The Evil Genius]

Casually stockwatching CCIV and it's up another 13% today...wow. 

 

 

[gbear]

If I thought it was worth less, I would have just sold it all off.  I kept a third of my investment in it because I still think there is potentially a larger upside after the deal is finalized.  I just wanted to take my initial investment back out because I wanted to put it into the stock I have looked at for awhile.  I should have pulled the trigger on ARK when I first looked at it,  I still think their investment strategy will work well to compliment my over investment in an index tracking the S&P 500.   

[skinfan2k]

On 2/18/2021 at 2:13 PM, The Evil Genius said:

Casually stockwatching CCIV and it's up another 13% today...wow. 

 

 

I bought 100 shares at 17 and i sold an option that expired last night at 40.  I made 2500 off CCIV. could have made a little more if i didn't sell the option but who knew it would run up to 65 from 17 in 3 weeks!! 

 

Also just got my Robinhood tax form back and i made over $650K in transactions in day trading.  :x

Edited February 20, 2021 by skinfan2k

[Corcaigh]

On 2/17/2021 at 8:33 PM, TheGreatBuzz said:

 

There is a lot of good-sounding advice in your post.  Some of it I even understood.  

 

We have my military pension check.  She has a Roth 401K that we max out per year and her company kicks in a pretty good match.  Other than that, we have money just sitting in a bank account earning .4%.  

 

EDIT:  Oh, and I like the idea of a plan that manages itself because I have no idea what a lot of the other things that go into are.

A very important point I should’ve mentioned is being aware of fees. This is another reason why low-cost index funds are so important as they allow the investor to keep most of the gains. From John Bogle’s book Enough...

 

• The gross return generated in the financial markets, minus the costs of the financial system, equals the net return actually delivered to investors.

• Thus, as long as our financial system delivers to our investors in the aggregate whatever returns our stock and bond markets are generous enough to deliver, but only after the costs of financial intermediation are deducted (i.e., forever), the ability of our citizens to accumulate savings for retirement will continue to be seriously undermined by the enormous costs of the system itself.

• The more the financial system takes, the less the investor makes.

• The investor feeds at the bottom of what is today the tremendously costly food chain of investing.

 

[Corcaigh]

On 2/17/2021 at 10:22 PM, TheGreatBuzz said:

@techboy  Thanks.  I looked at that Bogleheads forum by kinda felt like a lot of it was over my head.  

The Wiki is a great place to start. Here is a page on prioritizing investments ...

https://www.bogleheads.org/wiki/Prioritizing_investments

 

[Springfield]

FYI, it's believed that CCIV and Lucid will announce their merger on Tuesday. This week should be interesting.

[Bonez3]

Is Yang a good buy right now?

 

I've followed that for a while after reading about it in here. Seems like a ripe time

[Springfield]

I’d be suspicious of investing in an ETF that has done nothing but drop over the last year. If it drops low enough and they’ll just reverse split it. China, and all the other globals, will eventually turn bear. Timing it is nearly impossible though.

[BatteredFanSyndrome]

CCIV wtf?

[Bonez3]

You would think the CCIV merge was good news??!?

21 hours ago, Springfield said:

I’d be suspicious of investing in an ETF that has done nothing but drop over the last year. If it drops low enough and they’ll just reverse split it. China, and all the other globals, will eventually turn bear. Timing it is nearly impossible though.

Feel like the timing has never been better

Edited February 23, 2021 by Bonez3

[Springfield]

37 minutes ago, BatteredFanSyndrome said:

CCIV wtf?

It **** all over my Monday evening.

 

Only think you can hope is that it turns around tomorrow.

 

6 minutes ago, Bonez3 said:

 

Feel like the timing has never been better

it’s very possible. People seem to think we are entering a global downturn so that would certainly hurt China’s market.

Edited February 23, 2021 by Springfield

[Bonez3]

9 minutes ago, Springfield said:

 

 

it’s very possible. People seem to think we are entering a global downturn so that would certainly hurt China’s market.

Alright, well let's talk it up like Reddit and do this... To the moon

[skinfan2k]

Spac mergers always **** the bed.  They are pumped up by too many twitter fools, you just have to get in at the right time and get out before the merger.

 

I was in Nikola 100 shares at 40 pre merger and then it skyrocketed to 92 on the first day or two and then crashed. 

[No Excuses]

GUH all around. Hope you CCIV folks locked in those gains. Lol

Edited February 23, 2021 by No Excuses

[BatteredFanSyndrome]

This is why I only play around with a little bit of money.  Because I don't know what I'm doing and silly me thought the merger was good news and to hold the stock.

[tshile]

On 2/17/2021 at 8:53 PM, techboy said:

As an example, you have a pension, which ironically makes you much more able to take risk, since you have that to fall back on. On the other hand, that means you don't really NEED to take risk, because you don't need bigger returns to fund your retirement, and you've said you're risk adverse, so maybe you don't really want to take risk anyway.

i feel like this is a piece of guidance often glossed over. 
 

I am risk adverse with my investing (I separate investing and gambling. I invest for college funds or retirement. I gamble with throwaway money on stocks/funds that interest me.). So it always sticks out to me in conversations that this is missing. 
 

It seems the mentality is often “how do I make the most money”

 

and for many people the better question is “how do I best make sure I have at least X amount, which affords me the life I want”

 

sure, having more money is always better than having less money. 
 

that doesn’t mean having more risk is always better than having less risk. 

Add: this same risk tolerance mentality can be used with your career. Sure. More money is better than less, as a basic statement. But your job has many (opportunity) costs. Stress, time dedication required, and job security are things you typically give up as you’re climbing for more money. That’s not always a good thing. 

 

Edited February 23, 2021 by tshile

[Spaceman Spiff]

13 hours ago, BatteredFanSyndrome said:

CCIV wtf?

 

Yeah, that was alarming.  Checked last night before going to bed, didn't believe it.  

[No Excuses]

1 hour ago, BatteredFanSyndrome said:

This is why I only play around with a little bit of money.  Because I don't know what I'm doing and silly me thought the merger was good news and to hold the stock.

Rule of thumb is that if the price is shooting up based on a rumored event, it will already be baked in when X event happens. And then the sell off begins. Although it’s also coinciding with money shifting from tech stocks to boomer **** that tanked in March 2020.

Edited February 23, 2021 by No Excuses

[steve09ru]

the timing was **** on that - had stop orders from a week ago at 48 but happened after vanguard cuts off trading.  would have been nice to be able to pull in more profits but oh well- it's a good long term hold as well IMO