EXACTLY.
The only thing I would add is that often people who do learn about market/economy/stock investment - sometimes very smart people - still unperformed the broader market.
Either real estate or stocks, any one can make money, run the business successfully. Success depends on various factors, timing, cash position, leverage benefits…etc. There are pros and cons on each of these.
If you want to analyze broadly, keep it equal standards, stocks will outsmart real estate in the long run. This is well known with google search results.
It is like buy vs Rent, this debate, Stock vs Real estate, never ends
High risk high return In the long run, a higher risk investment should yield higher return. But. Yes, but short-term anything can happen AND you can be insolvent and don’t have sufficient time to recover because you’re older than me And I don’t have sufficient time to recover compared to wqj. So better be as prudent as you can. Adopt WB’s “don’t lose”.
You can’t, won’t succeed if you keep your hands in too many losing investments.
Has anybody done a study of their own money placed on a stock, say Apple where they can track what’s their profit and match it against what that investment would produce if they put in into a CD or any municipal funds, o anything attached to the whims of the stock market?
I make the questions because most of people I ask questions about their contribution on a 401K can’t and won’t have any concrete answer of the total amount every month or year. They don’t even have any idea of how much they have grown. None at all, just “I got money there”.
Lead by a true statement doesn’t imply the ensuing statements are true. Playing game
Asset allocation. Risk adjusted return. What most of us should aim for is a stable return. So putting all in one basket is not a good idea. Tell me how your IUL help to achieve this aim? Why would I want to complicate my asset allocation with IUL if my current asset allocation can already meet the goal of IUL? Too many instruments are hard to track and usually lead to bad return. KISS Primary, S&P index, rentals and focussed stock portfolio in descending order of building up. Ahem… I did build up rental before stock portfolio
I am going to ask you this: you have $100 to invest, and I am going to use “invest” though I can’t use that word with my clients. Got it.
OK, You buy a stock from say Apple at $100
Then, they allow you to pull $80, you never pay it back.
Now, your tock is worth $80 earning I don’t know, say 7% annually, compounding interest as seen during the last 20 years. Jill mentioned it, S&P 500 index is giving you 7% returns, compounding interests.
Now, remember the $80 you borrowed?
Invest it on whatever you like.
Or, just add another $20 to buy another $100 stock from Apple.
You put $100, got $160 to work with.
Added: Do this month after month. What the results would be?
Did I tell you that your $100 or whatever positive return “stock” in Apple is not going to lose its value but will go up when Apple goes up?
That is leveraging your money.
You won’t get it if you are a negative people stuck in old stuff. That’s all.
You fraudulent troll. That’s not what happens as has been explained and proven. You’re paying interest to borrow back the 80%. You are so stupid you can’t even see you’re literally betting the investment gains in the IUL policy will be higher than the loan interest. If not, you lose money. 40% of the years you’ll lose money based on the interest rate you provided and 30 years of market returns.
Checked just now. MCA is down from 14.5 to 12.3. Why? I am looking for something that’s like a CD (no loss of principal) but better interest rate. Tax friendly is even better.
For me, Individual stocks are wild ride, better gains, better dividends in the long run than indexing.
As long as I feel that I have enough skill set to choose individual stocks, I will definitely buy stocks than indexes.
I tried small amount indexes or mutual funds, but it is boring for me.
In some retirement accounts, I still have HACAX and DODGX considerable good amount (There is no choice better than these).
In my taxable account, I have FZROX, but every low amount.
They retain face value, but the price you pay will vary unless you buy on issue. As rates go up, you’ll pay below face value for older bonds with lower coupon rates. You want to watch yield to maturity. That’s a combination of coupon rate plus market price vs face value.
If you ever sell a bind before maturity, there’s a risk it’ll be worth less than face value.
I hold a mix of index + individual. I’m considering going very simple in future aka Bogleheads style.
Mainly because I do think I need to spend more time on active income earning and less on thinking about a portfolio that is too small to actively manage.