Stock Market is the bottom in?

[Howboutthemdawgs]

Will the Vatican have open borders? Open borders for thee and not for me.

At the same time the socialists stop flying private to fight the oligarchs

 

[buckvelvet]

Selling stocks when you don't hold them for more than a year will cost you twice as much in taxes on any profit you make from selling.

Not if you only do the playing around parts in a Roth, limits contributions obviously but it does avoid that & it scratches the itch.

 

[jsasker007]

What are the contribution limits on a ROTH now? I'm out of the loop on that but the last I remember it was maybe $6,500 yearly?

 

[homerj]

$7K 50 and under, $8K for over 50

 

[jsasker007]

Gotta say this ASST ride has been fairly exciting so far.

 

[Bowsnbucks]

What do you guys think I have seen this back and forth.

Index funds like what @Bowsnbucks mentions, say VYM, or high dividends like ZIM & INSW, single stocks like Tesla or Nvidia, combos of all?

I love these discussions of 'over time' whats the right approach.

We have combinations of active and index funds. Had 'em for decades. We have a mix of growth, value, dividend-payers, large & small cap stuff, MM fund, real estate, & bond funds. Depending on strong trends, we may tilt money in a certain direction to take advantage of those situations. Diversification tends to smooth out bumps over the span of time. A person aged 25 to 30 would probably be more aggressive than a person aged 65 to 70. Younger people have more years to recoup any losses. As people age, they tend to look to have investments that generate streams of passive income to replace job income. If planned wisely, one can live off the income "gravy", plus Social Security & Medicare (which we paid into) - and not dig too much into their principal. IMO, that ought to be the goal of us non-billionaires.

 

[Bowsnbucks]

I'm pretty sure it was Charlie Munger that said you can't beat the market. I went and checked to see if the actively managed funds could beat the S&P 500. Keep in mind that these funds have trained trading professionals with incomprehensible resources. Here is how they did since 2001:
View attachment 77211
Taken from here: https://www.spglobal.com/spdji/en/documents/spiva/spiva-us-year-end-2024.pdf

About 35% of the large-cap funds beat the S&P in 2024, which is honestly better than I would have thought.

As you extend the timeline, the odds get worse and Charlie gets more correct:
View attachment 77213

I still keep some solo stocks, but mostly because I believe in the company or I know more about what they do than I think the general public. Maybe I am leaving money on the table by not being more active? To me it seems like the more I learn about equity investing, the less it makes sense. For now, I mostly just dollar cost average into index funds. Also, Bitcoin, but that is a whole other thing.

Bogle famously said, "Why try to find the needle in the haystack. Just buy the whole stack." Over decades since the Great Depression, many mathematically-savvy folks have shown that beating the "market" on a consistent basis is nearly impossible. That's not to say certain stocks or funds can't beat the market in a given year - or 2 - they can and do. But over the long-term, indexes, which mimic the entire market (or specific segments of it), have beaten individual stocks and funds ...... and at much lower cost to investors. Most folks are not Buffet, making big bets on a few companies like he does, so we take the route most likely to get us to financial security. With mutual funds, we get professional management / stock picking, in a much more efficient way to buy stocks & other investments than doing so ourselves, at cheaper expense ratios. And you don't have to spend loads of hours researching individual stocks ..... if you know how to do such research yourself. I don't want to spend my life in front of a computer screen - the fund managers are paid well to do the research.