The Long Term Investor

Tell us more Alexander and welcome to the thread. Real estate is really HOT right now in the right residential markets. I can also see where there might be some deeply discounted deals available in select commercial property now also. What is your real property plan?

TomB16. Great story on the previous page of posts. I recommend ANYONE that is a new investor go back a page and read the last post by TomB16. My LIFETIME experience is the same. EVERYONE that I have known or come into contact with that was a trader of ANY sort, NEVER built up any sort of long term money. SOONER or LATER......they ALL lost money and moved away from stocks. MANY became very negative about stock investing and gave it up completely. VERY SAD. As I mentioned once previously........a friend of mine in the art world.......is a high level Vice President at a major brokerage and is still working at age 80. He has over 55 years in the business. He has told me many times that he can count on one hand the number of successful investors that trade that he has seen in his lifetime. His thinking MIRRORS much of what I post on here about investing for the long term. AND.......he is seeing peoples REAL accounts......NOT........what they claim to be making.

Markets are strengthening as I type this. BUT.......who knows.....things are so skittish and erratic these days. I am sure......although I dont know as a fact......that people are very afraid to come back into the markets. I do know from the data that there is a HUGE amount of cash siting on the sidelines. DOOM&GLOOM and FEAR are very powerful DE-MOTIVATORS (is this a word?) for people when it comes to investing.

 

This article is SO TRUE. I have seen the stories in the MEDIA lately fear mongering SWINE FLU and BUBONIC PLAGUE How ridiculous. AND......how corrupt and dishonest on the part of MEDIA. Well.....perhaps not dishonest......perhaps the level of intelligence of........I hate to even use the term......"journalists".......is just TOTALLY in the toilet.

The Hunt for a Pandemic Repeat Is Already Starting
Investors’ fighting the last war is normal in a new bull market.

https://www.fisherinvestments.com/e...unt-for-a-pandemic-repeat-is-already-starting

(BOLD is my opinion OR what I consider important content)

"Though COVID-19 still dominates headlines, it seems some are now seeking new worries. So far, they seem to have found two: swine flu and, um, the Bubonic Plague. The former has circulated through Chinese hog farms for over a decade, occasionally infecting people. The latter turned up in a shepherd in Inner Mongolia. Don’t be shocked if either stays in the headlines for a while—or if other diseases hit the headlines with the words “pandemic potential,” which have accompanied most of the swine flu coverage. One regular feature of new bull markets is the near-universal tendency to fight the last war. Heightened awareness of every illness percolating in a corner of the world doesn’t mean a new disease is set to truncate this recovery.

For now, there is no evidence this strain of swine flu is circulating broadly among humans. As Bloomberg highlighted, research suggests it has infected “dozens” of people since 2016, and it is getting headlines now solely because of a research report noting that it has characteristics making it a pandemic “candidate.” That doesn’t mean it is likely to cause a pandemic, much less one on the scale that would inspire a mass global lockdown. The last swine flu pandemic, in 2009, didn’t. As for the plague, it is actually fairly normal for a handful of cases to turn up in rural areas each year, typically arising from human contact with infected wildlife. As The New York Times pointed out, even the US averages seven cases annually.[ii] Additionally, while society’s view of the plague is shaped by history books’ depictions of the Black Death in the middle ages, in this day and age it is a highly treatable bacterial infection.

But we aren’t here to play armchair epidemiologist. Rather, we thought it worth highlighting how utterly typical this behavior among investors—seeking a repeat of the last bear market’s cause—is in early bull markets. As a general rule, investors spend much of a bull market on the lookout for a repeat of whatever caused the last bear market—a phenomenon called fighting the last war. In the bull market that ran from 2009 to 2020, investors were on perpetual alert for “the next Lehman Brothers” or “the next 2008.” Early on, many feared Alt-A mortgages were the second shoe set to send stocks far lower and kill off any recovery. Later, it led to mini freakouts and a litany of think pieces on distressed auto loans, student loans, collateralized loan obligations, leveraged loans, junk bonds, Energy sector bonds and Italian banks. None caused the next bear market. But all received heaps of scrutiny. In the 2002 – 2007 bull market, all eyeballs were on Technology stocks for any renewed signs of froth. That even lingered into the most recent bull market, with people parsing every uptick in IPO activity for hints of Dot-Com Bubble Version 2.0. But Tech euphoria didn’t cause the next bear market, either.

When the investment world gets laser focused on a certain issue, that issue generally loses its power. Surprises move markets, and as investors fight the last war, they drain its surprise potential. We see that happening now with diseases. It wasn’t the simple existence of the novel coronavirus that caused this year’s bear market—it was society’s response. It was the choice to shut down basically the entire developed world economy for several weeks, which forced markets to price in the sharpest economic contraction on record. No one expected that in February because it had never happened before. But now, with the memory still fresh—and the reality of lockdowns still being lived in several cities—it seems almost everyone expects it. We won’t go so far as to say a second mass global lockdown wouldn’t be a problem. It could be. But it would have to be something hugely major (repetition intended) to be worse than what people expect and pack a severe punch.

We are big history fans, and in our study of past bear markets, we have found that two bear markets rarely have the same cause. When everyone stays busy fighting the last war in a bull market, it creates an opening for some other negative to squeak through unnoticed. So while vigilance is always a good trait, being hyper vigilant for the next bearish pandemic probably won’t be the ticket for long-term investing success. Taking some time to look where others don’t—for opportunities as well as risks—will likely prove a more fruitful endeavor.

MY COMMENT

As long as stories on the INCREASED number of positive tests.......a totally meaningless statistic.......generate eyeballs and clicks, we are going to see this "stuff" day after day after day in the media. ALL of the data is showing that the increased positive test results are due to INCREASED TESTING and younger people 20-35 years old being positive with little to no symptoms. The actual data that means something.......deaths per million is going down every day. On a local level, I see report of a couple of hospitals in the Rio Grande Valley having capacity issues. I never see anyone in any of those articles mention the HUGE influx of patients coming to those hospitals from Mexico.

BUT....I digress.....it is s total waste of time to discuss anything to do with this virus situation. EVERYONE has their own opinion and that is the way it should be. People MUST be free to have their own personal opinion. That is why I try to avoid posting on this topic.....other than stuff that is investing related like the article above. It is a waste of time to argue about things like this that are RIGHTLY individual, personal opinion.

AND.....saying this, I DO NOT support in any way those that do not COMPLY with wearing masks or social distancing or sanitation procedures. These are the current societal norms and throwing a HISSY FIT or refusing is simply RUDE and DISCOURTIOUS to others around you in public. ANY private business has the right.....regardless of government mandates.....to require masks and other procedures.

 

Zukodany. To me a "trader" is a short to medium term speculator. AND......someone that does it as their primary investing style. Not someone that does a trade once in a while to try to capture a specific situation. BUT.....who knows. AND.....does it even matter. If someone chooses to speculate in a certain way that is their business. I just in general see a BIG difference between "trading" and "investing".

I dont see anything negative about trading a certain percentage of your money as a challenge.........like 5-10%. Or if you have so much money it does not matter. The problem is.......this USUALLY leads to taking more and more risk with more and more money. With humans it becomes an issue of EGO and HUBRIS and OVERCONFIDENCE and gets out of hand. It is not necessarily a bad thing to do trading and also have a core long term portfolio.

Who knows?

 

Google.......not too bad. One year total return.....31.1%. Three year......58.1%. Five year.....168.6%. So over five years averaging 33.72% per year.

MSFT, AAPL, GOOGL, AMZN, will ALL jocky back and forth year to year. Five year returns......AAPL, 212%.....Amazon, 560%.....Microsoft, 413%. These numbers are SO EXTREME.....the make Google look like a weak sister. BUT.......that is illusion. I will take a five year return of 168.8% any day of the week.

The portfolio as a whole is just as important as individual companies. I have said often......I think most people own too many different stocks or funds. They over diversify themselves to death.

 

That is an AMAZING return for five years. Way above the average of about 11% by the SP500. The other three......OFF THE CHARTS......

MYSELF.....today......GREEN big time. A STRONG come back toward the end of the day for the markets. BEAT the SP500 by .59%. Amazon was STELLAR....up $81.

 

USUAL week.....couple of days up....couple of days down.....and the fifth day a toss up. At least I have a GAIN so far today. And a BEAT on the SP500 of 1.09%..........so far.

Good to see you here....Ragin Cajun. PLEASE.......post your portfolio and moves as you become invested. Also anything else you wish. We always need more long term oriented people to post on here.

I know you did not ask. BUT.....if I had a big chunk of money to invest right now.....I think I would invest it in 20% chunks. I would leave about 40% till after the election in case of a BIDEN win which I anticipate will tank the markets. I would put in the other 60% before the election.......... with perhaps 20% now and the other 40% between now and November. BUT....that is me. I tend to be aggressive about investing ALL in ALL at once.

I like your portfolio plan.