The Long Term Investor

LORI.....I am curious with you being in England.....do you know many people that invest? Is it common there? Is long term investing common in your country? Do most investors in England focus on American companies.....or...is the focus mostly on Europe and the EU?

RG, Strathmore, and others in the EU and other countries......same questions. Give us a view of what you see regarding investing in your country. Do you see people investing in stocks and funds for retirement in your country....or is that unusual?

 

Here is a big driver of the rally today.

Nvidia, tech stocks rally after Trump announces $500 billion Stargate AI project

https://finance.yahoo.com/news/nvid...00-billion-stargate-ai-project-153919780.html

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

"Nvidia (NVDA) stock jumped more than 4% Wednesday, extending gains from the prior day following Trump’s announcement of a massive, $500 billion AI infrastructure project.

The project creates a company called Stargate, funded by SoftBank (9984.T), OpenAI, Oracle (ORCL), and MGX. OpenAI named Nvidia as well as Microsoft (MSFT) and British chip designer Arm (ARM) as “key initial technology partners” for the project, which aims to build out US data centers required to power artificial intelligence. OpenAI said Stargate would “begin deploying $100 billion immediately" and invest up to $500 billion over the next four years.

Nvidia's gain Wednesday pushed its market cap to $3.58 trillion, ahead of Apple's (AAPL) $3.35 trillion.

Meanwhile, Microsoft shares rose 3% early Wednesday, while Arm surged more than 15%. Oracle stock was up 5.5%, and Softbank jumped almost 11%.

“Stargate will be building the physical and virtual infrastructure to power the next generation of advancements in AI, and this will include the construction of colossal data centers, very, very massive structures,” Trump said in a briefing Tuesday. “These buildings, these are big, beautiful buildings are going to employ a lot of people.”

Trump said the effort is meant to maintain the US lead ahead in developing artificial intelligence ahead of China.

The announcement follows a a slew of executive orders from the Biden administration on artificial intelligence last week aimed at restricting the flow of AI chips to China and speeding up the construction of data centers in the US.

"This comes at a critical juncture as we expect Trump to aggressively court more AI investments in the US," wrote Wedbush analyst Dan Ives in a note to investors late Tuesday. Ives noted that the project is "all part of a broader game of high stakes poker with China."

After the announcement, Elon Musk took aim at OpenAI on his social media platform X. Responding to a post from OpenAI about Stargate, he wrote "They don’t actually have the money." OpenAI estimated that it lost $5 billion in 2024, but generated just $3.7 billion in revenue.

Tech stocks across the board rallied on the news of the major AI investment. Dell (DELL) and Super Micro Computer (SMCI), which make servers using Nvidia chips, rose 7% and 6%, respectively. Nasdaq futures (NQ=F) climbed 1.4%, ahead of S&P Futures' (ES=F) 0.6% gain.

Nvidia’s surge Wednesday puts shares up over 11% from last week.

The stock had fallen in early January after The Information reported that the three of the chipmaker’s biggest customers — Amazon (AMZN), Google (GOOG), and Meta (META) — canceled some orders of servers using Nvidia Blackwell AI chips due to glitches and overheating problems. Shares were also under pressure from the Biden administration’s move to cap exports of AI chips."

MY COMMENT

The last first......the recent attempt by "the Information" to attack NVDA did not work.....the media and others mostly ignored it this time.

NOW....WTF.....we are going to build a STARGATE? What about Ra and the other gods of old Egypt?

I like it....we should be naming all our economic and other policy projects after old Sci-Fi and futuristic movies. We now have...."SPACE FORCE".....and....."STARGATE". This will be cool...... as long as we can avoid names like.......IDIOCRACY......and...SPACEBALLS.

 

A nice BIG gain for me today.....even though I had three non-tech stocks in the red....COST, HD, and CMG. A good rally today for the TECH giants. I also got in a nice big fat beat on the SP500 by.....1.85%.

Hump day is over......now it is all downhill for the markets from here to close out the week.......( I wish).

 

The obvious story of the day.

Nvidia, tech stocks rally after Trump announces $500 billion Stargate AI project

https://finance.yahoo.com/news/nvid...00-billion-stargate-ai-project-153919780.html

MY COMMENT

If we are lucky this rally today will carry over to close out the week.

 

A week or two ago NVDA was down in the dumps. BUT now......it is in range to hit a new all time high. As far as I can tell the all time high is $153.13. At the close today it was at $147.07. We just need to see a gain of another $6.06. Definitely possible this week or next.

 

Looks like some of the earnings dates have changed for some of my nine stocks. Here is what I am seeing as the latest.

MSFT January 29
AAPL January 30
PLTR February 3
GOOGL February 4
CMG February 4
AMZN February 6
NVDA February 19
HD February 25
COST March 6

Looking forward to the first......two of nine.......next week. For some reason.....two of nine....reminds me of THE BORG.

 

Today at the open I added $4000 of PLTR in my kids account. This brought the position up to a totally FULL position in terms of......cost basis....compared to all the other positions. The value of the position is already second highest in the portfolio. The highest value position is....of course....NVDA.

I got lucky....I got the shares at $76.05. SO....with the price now they have a gain of +2.3%. A good way to start those shares out.

 

Great report Lori. Here in the USA stock investing in some form.....especially in 401K and other retirement vehicles is basically the norm. Although most people still dont know much about it and dont have an account outside of retirement.

You are in a great position.....WELL DONE.

Are you able to put your retirement money in a broad Index ETF....like the SP500?

One general word of warning......you might want to....perhaps....keep your retirement account a bit more conservative than your brokerage account. Perhaps in a SP500 Index Fund if that is an available option. That is what I would do....but you being you and especially being in another country.....you have to do what is best for your specific and personal situation.

 

For me as a business owner when I was working.....I took risk in my brokerage account.....but....I kept my retirement money relatively conservative. My initial plan for my retirement money was in ULTRA safe 30 year US Treasury....zero coupon bonds. This was done through a retirement vehicle called a "KEOGH PLAN"....basically a small business pension plan that allowed me to put in $30,000 a year for myself. I also covered all my employees.

I put that entire $30,000 per year into the zero coupons for a good number of years in the early to mid 1980's. The rates that I got were INSANE......11% to 13%. I figured I would hold those for 30 years. BUT....change of plans......when rates came back down to normal.....5-6%......the value of those zero coupons EXPLODED.

Than out of the blue one day I got a call from my broker....a vice President at Merrill Lynch. They wanted to buy my zero coupons. I was skeptical but he gave me a quote for one of them and it was way above the market value. As we negotiated the rest of them I kept going higher and higher in what I wanted. In the end he was whinning about how I was screwing them.....but....he kept accepting my price. They obviously needed those zero coupons REALLY badly and had no choice but to pay the price.

Basically I got over full value.....as if I had held those for 30 years......in only about SEVEN years. I would have been a big FOOL to turn down full payoff........in only seven years...... so I took the money and ran. I than switched all that money in my retirement account to stocks in the form of funds.

I still marvel at how much money I was making on the interest on those zero coupons and how they exploded......and.....that I got over a FULL 30 year payoff in only about seven years.

 

Back to LORI.

I like to think that if I lived outside the USA I would still be smart enough to only invest in American companies and Index ETF's. In the world today.....there is no need to only ivnest in your own country. Everyone has access to the best companies and investments in the world now. Why not take advantage of that?

It is not a matter of national pride...it is totally self interest. If you don't look out for yourself....who else will?

A few personal questions.....if you dont mind Lori.....how old are you? What type of work (in general) do you do?

 

I like this little article.

Investing is Hard

https://behaviouralinvestment.com/2025/01/22/investing-is-hard/

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

"Imagine it’s ten years ago and you are assessing the relative merits of market cap weighted exposure to US equities and an equally weighted allocation. Across a range of valuation metrics you can see that the equal weighted index is moderately cheaper. As luck would have it you also have a crystal ball that tells you that EPS growth will be greater for the equal weighted index over the next ten years. Same constituents, lower valuations and superior growth, that seems to be a great starting point for an equal weighted approach. So, what happened next?

Over the subsequent ten years the market cap index outperformed by close to 80%.

Investing is hard, and for many reasons:

Sensible decisions will frequently make us look stupid: It is not just that virtually all good long-term decisions will go through difficult spells; it is that seemingly prudent choices will often have negative outcomes and make us appear foolish.

Crystal balls aren’t enough: One of the inherent challenges of investment decision making is that the future is profoundly complex and uncertain. Our conviction must always be tempered by the vast amount we cannot and do not know. As the equal weight US equity example shows – even a glimpse of the future will often not be enough.

Sentiment can overwhelm everything: It is not just that it is hard to forecast future fundamentals, it is that anticipating fluctuations in sentiment is even more challenging. The underperformance of equal weighted US equities over the past decade has been driven by a transformation in the perceived prospects of the largest companies in the market.

A longer time horizon doesn’t guarantee success: Having a long time horizon is the greatest advantage any investor can have. (How long? As long as possible). Unfortunately, it is not enough to ensure a positive outcome. Although the impact of swings in sentiment fade with the passage of time, they can still exert a huge influence over periods longer than most of us can bear. A long-term mindset is still our best chance of success. It materially improves the odds, it just doesn’t provide anything close to certainty.

Extremes matter: The psychology that drives financial markets means that prices tend to traverse periods of unbridled optimism and entrenched pessimism. Assets don’t always rest in an equilibrium state. This means that active views are probably best taken when those extremes are already evident – leaning against excesses is probably where the probability of success is greatest. Marginal active views (like equal weight versus market cap ten years ago) are too often beholden to the next unpredictable shift in sentiment.

It is somewhat dispiriting to know that even if we had advance knowledge of critical equity market fundamentals, we would still likely look as if we had made an irrational decision. There are vital lessons that stem from this example, however. Most importantly that humility is the critical trait for all investors – we will frequently be wrong, and our actions and behaviour should reflect that. What is the best evidence of a well-calibrated, humble investor? Sensible diversification.

Investing is hard and the future is uncertain. It should show in our portfolios."

MY COMMENT

Actually investing is simple. What is hard is doing the simple things that are just about impossible for the human brain.

I invest the way I do....in ICONIC SUCCESSFUL big cap American companies and funds like the SP500....to boost my chances of investing success.

As seen and mentioned many times in this thread....I try to invest according to all the....."PROBABILITIES".....that are identified and proven in the academic research.

One of the most difficult things for any investor.....keeping the faith and powering through....an extended BEAR MARKET. it is simply....soul sucking. I dont have to like it....but I do it and always will.

 

I like this little article.

DAVE RAMSEY: Don't wait on the Trump White House to fix your house. Do 5 things millionaires do
I am confident the new Trump administration will improve our economy. But it will not make you personally wealthy or successful

https://www.foxnews.com/opinion/dav...se-fix-your-house-do-5-things-millionaires-do

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

"Change is in the air. A new year, a new president and a new moment for it to be your turn to win. I’ve spent the last 40 years studying wealthy, successful people and the principles that made them members of that club. This new day in America is going to be your best chance in a long time to apply those principles and live your dreams.

While I am confident the new Trump administration will improve our economy, it will not make you personally wealthy or successful. The truth remains that what happens in your house, not what happens in the White House, has everything to do with your ability to win and live your dreams. Successful people will tell you the government takes much more than it gives. So, while you can be excited about the new administration’s approach to the economy, you cannot wait passively on the sidelines hoping President Trump will somehow make you wealthy. He won’t. It’s not his job.

As a person of faith, I’m a big believer in prayer. The Bible is very clear that God does not financially bless the lazy, or the incompetent. Praying for your corn to grow while failing to plant any is not a biblical principle nor one of successful people. St. Augustine is quoted as saying, "Pray as if everything depended on God and work as if everything depended on you." Proverbs 10:4 (ESV) says, "A slack hand causes poverty, but the hand of the diligent makes rich." My grandmother used say, "There’s a great place to go when you’re broke ... TO WORK!" God loves you, but He will not make you wealthy unless you follow His commonsense principles.

Knowing that the new administration and even God who loves you are not going to make you successful without your personal diligence and competence, then it’s up to you to take action. Doing the same thing over and over again and expecting a different result is the definition of insanity. It’s time for a change.

Our company, Ramsey Solutions, did the largest study of millionaires ever done in America. The research methodology was airtight, and we had an outside firm ensure we didn’t have any confirmation bias or other issues with our process. The conclusions of this study are based on data, which makes them facts. So, if you disagree with the findings, you are what’s known as wrong.

Normal in America is broke. In the most prosperous society in human history, people are making money and they're broke.

I unpacked the white paper in my number one bestseller "Baby Steps Millionaires," and we discovered many things your common sense will tell you and very few things to confirm your childish emotions about what it means to be a millionaire. Eighty-nine percent of America’s millionaires are NOT millionaires because of an inheritance. You can take hope in that fact because it means YOU CAN build wealth and live your dreams.

Millionaires do drive used Toyotas, and they do live on a written plan for their money called a budget. Millionaires are generous. And their purchase patterns indicate they do very little to impress others. Their Instagram highlight reel would be exceedingly boring. They don’t care what other people think. They are not taking a poll.

They are aimed at a goal of financial security and are willing to sacrifice to get there. They read more than they watch TV. They are mostly debt-free and pay off their homes on average in 11.2 years from the time they set their mind to build wealth. While people generally become millionaires at an average age of 50, we discovered a surprising number of young millionaires as well. They contribute to their 401(k)s in good mutual funds like it’s a religion. They agree on their goals with their spouse and work in unity, not separately. And both are emotional adults, no spoiled-child temper tantrums to distract them from their goal.

They like their careers and don’t say, "Thank God it’s Friday." They don’t say defeatist things like, "You’ll always have a car payment," or "The little man can’t get ahead," because they started with nothing — they are the little man! And they are proving every day that you can live on less than you make, and you can build wealth in America today. It takes them an average of 17 years from the time they start their plan to reach a net worth of $1 million. Most of the data sources we find indicate there are over 23 million millionaires in the United States today.

All this data tells us clearly that you have every reason to hope that you, too, can build a good level of wealth in our country today. And yet, normal in America is broke. In the most prosperous society in human history, people are making money and they’re broke.

Fifty-five percent of people who have debt say they lose sleep over it. The average new car payment is over $700. Most people have had student loan debt so long they think it’s a pet. Credit card debt is over $1.14 trillion. The number one cause of divorce is money stress and money fights. Normal is making money and broke. Normal sucks. Time to change. Time for some new habits and principles. Time to try doing what millionaires do. Here are five things you can take right now.

1. Get on a budget
You need a detailed, written plan for your monthly spending. Check out our EveryDollar budgeting app for help.

2. Get out of debt
Your most powerful wealth-building tool is your income, so stop giving it to credit card and car companies in the form of monthly payments.

3. Live on less than you make
Pay cash. If you can’t pay for it with cash, you can’t afford it. You are not in Congress. You can’t spend more than you make and win.

4. Give money away

Be generous. Be a good tipper. Help others.

5. Save money
Build an emergency fund because you will have emergencies, and they will become debt if you don’t. Invest in your Roth IRA or 401(k) in good mutual funds EVERY month.

You work too hard to be broke. Personal finance is 80% behavior and 20% head knowledge. I am positive the American Dream is not dead because I meet people just like you every day who have overcome unbelievable challenges to build wealth. It’s time for a change.

Don’t wait on the White House to fix your house. Don’t wait on the sidelines of your own life any longer.

You have every reason to have hope in — and work for — the American Dream."

MY COMMENT

I will add to the above....as you follow these steps and free up money to invest.....follow the long term investing principles that are set out in this thread. That DOES NOT mean follow..."what I invest in". It means follow the general principles that are used by all long term investors.......that are set out and illustrated by many posters in this thread.

 

There is always some micro-reason for the day to day market. Here is one take on today.

Chip stocks fall as Nvidia supplier highlights market uncertainty

https://finance.yahoo.com/news/chip...-highlights-market-uncertainty-150914100.html

 

HERE is the early market today.

Dow, Nasdaq, S&P 500 steady as Trump takes the spotlight

https://finance.yahoo.com/news/live...y-as-trump-takes-the-spotlight-143103247.html

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

"US stocks drifted on Thursday, easing back on a bid for fresh records as AI optimism waned and investors watched for any remarks on tariffs as President Trump spoke remotely at the World Economic Forum in Davos.

The S&P 500 (^GSPC) rose 0.1%, coming off a three-day win streak that saw the benchmark index close Wednesday on the cusp of setting a new all-time high. The Dow Jones Industrial Average (^DJI) traded 0.3% higher, with a record not far off.

Meanwhile, The Nasdaq Composite (^IXIC) fell 0.2% as tech stocks struggled to regain the momentum that propelled the previous day's gains. Nvidia (NVDA) shares dropped after its supplier SK Hynix (000660.KS) flagged uncertainty about chip demand this year, which also weighed on other related stocks.

Investors are still digesting Trump's early-days policy charge, which brought an AI push that invigorated tech names but left unclear when the outlined tariffs on big trading partners — a risk for inflation and stocks — might hit. The focus turned to Trump's remote speech at the World Economic Forum in Davos for more insight into his trade policy.

Eyes are on earnings to potentially buoy markets, after Netflix (NFLX) set that tone on Wednesday. GE Aerospace (GE) shares popped after the jet engine maker said it will raise share buybacks to $7 billion. In air carriers, American Airlines (AAL) stock slid after a downbeat 2025 profit forecast, and Alaska Airlines (ALK) shares rose thanks to a smaller-than-expected first quarter loss forecast.

On the data front, US jobless claims increased by 6,000 to 223,000, official figures released on Thursday showed. Economists had expected a reading of 220,000 for the week."

MY COMMENT

A typical day today...with NOTHING really going on. We are seeing the usual negative opinion journalism creep back into the markets....in content today. fortunately earnings are happening and they reflect REALITY that does not care about media opinion.