Furthermore, AAPL does not make any product that does not have a substitute in market. So, if AAPL does leave market, other than AAPL fans, no one will even notice. AAPLs exit will not even affect the degree of competition in the market.
I repeat, if AAPL files bankruptcy, I need to rethink my tech strategy, there is no change. Rest, waste of time/discussion .
IMO, All those bloggers, suggesting diversification to me, does not know anything what they are BSing here.
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Your argument sounds like someone saying in year 2000, if Enron files for Bankruptcy, I will not buy energy stocks. The definition of a true free market means it makes no difference to the market if a players leaves it.
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That is @Jil argument. I am referring to the tech sector. See my original post.
Triple whammy risk,
Tech sector down (e.g. Dotcom bust) > SFBA down > your/your tenantsâ tech company down > jobless/ rentless?
Look at energy sector now.
Energy sector down > Houston down > your/your tenantsâ energy company down > jobless/ rentless?
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It is again waste of time, but for @hanera (one time exception) I am posting here.
Nasdaq (Tech sector or QQQ) and S&P both has AAPL as top company, next comes AMZN, MSFT which has 33% of QQQ.
If tech sector corrects, these 3 will be affected heavily. If AAPL goes bankruptcy, AMZN and MSFT will also be in same/similar state, that means USA itself in struggle (which the doomsayers are telling).
You trust blindly believe in AAPL and know AAPL will not bankrupt. When that is assured, naturally tech sector is assured.
Dot.com exactly showed us that booming after a great tech crash, 2008 showed booming after real estate fall.
[Edit: Picture proof removed]
Even yesterday, I took much harsher risk than this, got 60% returns in single day.
Compared to this, investing in bay area or QQQ does not have any risk.
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Careful of the survival bias mentality 
For each @Jil that survive, 100? lost their shirts 
You have quoted a few cases of your ex-colleagues/ friends.
Survival bias = Just because you survive and even prosper, doesnât mean your strategy/ approach is the right one and universally apply.
Just read about this guy. It is 100% real. Miracle happensâŚ!
European stocks are not that detached from Economic reality. so the systemic risk is much lower to both economy and investors.
Here federal reserve fear stock market downturn so it overcompensating.
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The question is why US stocks has so much liquidity? its because other sectors of economy are starved from funds?
Europe is not facing shortage of computers, vehicles, appliances, home treadmills on same scale as US and the prices are 20% cheaper on avg.
Industrial and logistics chain are now changing to better serve EU markets. Apple will have to compete for its Iphone components going forward with Global supply chains.
We simply cannot afford three operating systems Android/IOS/Window. too much manpower and wealth tied into it.
European stocks have worse returns in the corona recession. Systemic risk is higher, not lower. YTD return is -10%.
Maybe in your alternative universe itâs less risky?
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BMW is doomed. Germany is the biggest loser from Tesla and EVs
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Siemens might be a better bellweather - much more diversified. Itâs up nicely year to date and pays a steady, fairly rich dividend for a large multinational. The other thing about Europe is that a big chunk of our recent increase (last few years) can be attributed to the cut in the corporate tax rate. That is not an event which will be repeated. And if Biden and the Dems reverse it - you can kiss about 20% of that increase goodbye.
First, he has to win !
that exactly what i am saying. BMW has 16% quarterly decline in sales. (I didnot say production). and stock is already anticipating it.
BMW has made IX3 (Model Y competitor) at same plant where other BMW are made. that is huge progress without investing in dedicated plant. and these will be exported back to Europe.
this already put Tesla behind as it waits for expensive operation of Berlin plant.
I was exploring the idea of preserving wealth by investing in REAL ESTATE in non-competitive markets like RENO.
To find this home. I just went to zillow and picked up the second home in the grid.
This had zestimte of 130k in 2012. Now it is listed for 365K. The price has clearly appreciated 2+ times, about the same as what the SFBA real estate has appreciated. So this debunks the idea that SFBA real estate appreciate faster than others?.
If some one purchased a real estate in this market in 2012, he likely enjoyed same gain that someone who invested in SFBA real estate did. Except that the investor faced less competition and smaller downside risk to the principal in market outside SFBA.
And depending upon rentability and cap rate (which I am not very familiar with in Reno market) , the investor might have earned some cash flow all these years.
Could I be missing anything in the above summary?
Real estate maintenance is hassle, but the only benefit is leverage and easy to get big mortgage.
Rental home means good cash flow is the key.
Remote management, esp hiring a right property manager, is adding to the perils of maintenance.
Documentation, book keeping, timely property tax paymentâŚetc, you are responsible.
Selling time liquidity (easy sale is important). Rental flow is very important.
You have listed 6 or 7 places, but left Las Vegas. This is completely affected by COVID with 28.2% unemployment. When recession deepens, you will get good newer home at better discount. When economy recovery, you will have nice cash flow and appreciation, coupled with easy sale liquidity.
Other than this, multi-family home in bay area (or wherever you stay like Lake Tahoe for elt1 or Austin for hanera ) is better as you can handled all management with cheaper cost (lot of savings).
Except mortgage leverage, just buy/hold of S&P or QQQ (definitely better) will give you nice returns without major hassle. In addition, if you move out of state (esp state income tax free state), you can save some taxes when you retire/withdraw.
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Las Vegas is not what I call non-competitive market particularly when media has been portraying it as fastest growing city through out 1990s and 2000s. The moment you have to compete with another buyer and you are forced to pay more premium just to beat the other buyer, you are adding to the risk.
Wherever you get highest correction, you get a good deal. This time, entertainment industry is big hit.
Nevada and LV are the highest unemployment rate. Here is where you get nice deals when recession deepens.
Fastest recovery when economy comes back, good liquidity, access from worldwideâŚetc.
Even though I do not go for Real estate, my preference is Las Vegas, as it is easy for SFBA person to travel at cheaper flight/drive in case of issues.
Multiplex in good locations added weightage.
I think we need to clearly distinguish between three strategies:
- preservation
- appreciation
- income
Or some mix of all three.
When I say preservation, the aim is to protect an investment from loosing value (or to keep up with inflation ). The aim is not to double or triple in next decade. The idea is to be able to go in and out without much cost.
The problem with volatile markets (like SFBA) is timing it well so that when you have investable money, the market is at its lows. But, when you have investable money at hand, and the market is already making highs, it can be risky to enter. Less volatile markets just follow inflation and do not make sharp movesâŚ