The Steross Market and Investing Thread

steross said:
Are we heading into a recession?

A mixed bag. More seem to point away, but the ones that I trust the most (unemployment and yield curve) are worrisome. Anyone else have other things they look for? Do you use it in your investment plan?
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What you provided is very interesting, but I don’t even attempt to time the market with investing.
IMO, it is better for the average investor to continue money in market and just stay as diversified as possible …with very low fees.
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JTOSU said:
What you provided is very interesting, but I don’t even attempt to time the market with investing.
IMO, it is better for the average investor to continue money in market and just stay as diversified as possible …with very low fees.
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Who wants to be average? :D

Good point. I should qualify that my wife and I do time the market. She uses 1.88% of our invested assets. I use up to 3.76% of our assets but honestly typically am too busy to even do that so it is much less. The rest is almost all indexed. I track what we are doing versus indexes, and we are beating the S&P slightly. For the time spent probably isn't fruitful compared to working. But, it is more enjoyable than just working more. Plus, having a little bit that I play with reminds me how freaking difficult it is and prevents me from doing something stupid with the majority.

I don't agree with the thesis that the individual investor cannot beat indexing, but I do agree that the majority won't put in the effort to do it correctly, will get too excited when things are good, and too upset when things are bad.

I cut my teeth investing heading into the dot.com bust. Then lived through the GFC. A few years prior to the GFC I had taken a job that significantly increased my income relative to prior. Not purposefully, I had built up a lot of cash. I started a DVA plan coincidentally just prior to the GFC to get the money invested. With DVA you add money to keep your account value increasing. It was VERY difficult putting even more money in as the system appeared to be crashing. But I did and it worked out splendidly.

The problem for me is that my first ten years of investing saw two very large bear markets. Therefore, my tendency was to fear the market and hold cash waiting for the next shoe to drop. Add to that a move overseas and confusion on where to even invest, and I made a tragic mistake of sitting on far too much cash over the next 10 years.

Sorry, blathering on, but the point is that particularly for younger people I fully agree with you that it is best to close your eyes, stick the money in the broad low fee indexes of your choice, and look away for a few decades and enjoy the high probability that you will have significant wealth.
 
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Just had a round of layoffs with my company. They didn't mention tariffs but we're tied at the hip with the auto industry so there's a good chance that at least had some impact on this decision.
 
Anybody that’s investing for retirement would be advised to understand the concept of sequence of return risk and plan to take steps to mitigate the risk according to their situation and comfort level. Not doing so would be a really bad idea,
 
Polds4OSU said:
Tommy Tuberville: "We were probably over-bloated with the stock market here for a while. We went up quite a bit."

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That 70S Show What GIF
 
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