Stock Investments

[Otha]

I was searching to find realistic long term expectations and found 7 index funds all created by Vanguard 22 years ago on November 13 2000 and was surprised to see S&P 500 has not been the best of the group for average return per year.

1. Small Cap Index Fund 8.57% per year
2. Extended Market Mid Cap Index 7.57%
3. Total Stock Market Index 7.2%
4. Large Cap Growth Index 7.09%
5. 500 Index Fund 6.9%
6. Large Cap Value 6.87%
7. Balanced Index* 6.24%
*Balanced Index is a Fund consisting of 60% stocks 40% bonds
The order would be different if used 1 yr, 3 yr, 5 yr or 10 yr return

Total Bond Index Fund 3.42% since inception Nov 12, 2001

From my limited understanding(I've read a lot and invested little due to young age) small, mid, and large cap funds all have had their time to shine in the last 100 years along with growth vs value. I listened to a 2 hour lecture about the differences one time and decided for now a total market fund might be the safest bet until I find the time to do the extensive research to see what market cycle we are in and how that would effect the growth of small,mid, large cap and growth vs value. Like you said changing the length of the data changes the order of highest return.

 

[shaz]

I just bought a little Crispr Therapeutics a minute ago. It was either that or a scratch-off ticket, probably same result.

 

[Son of Butch]

I decided for now a total market fund might be the safest bet until I find the time to do the extensive research to see what market cycle we are in and how that would effect the growth of small, mid, large cap and growth vs value.

A penny saved is a penny earned. Index funds are low cost and efficient.
By design a Total Market Index Fund will never be the top performing fund in any year. But more importantly it has never been in the bottom 50% either. Historically you can expect it to finish in the top 1/3 and I think being above average long term is an important goal and TMIF lets you achieve it without wasting a lot of time trying to beat the market.
In my opinion, when in doubt the Total Market Index is the way to go.

 

[Son of Butch]

Expectations: A poll of 4,000 with 1,000 from each age group
At What Age Do You Expect To Stop Working?
Boomers (58+) at age 68 chief concern: safety of financial information online
Generation X (42-57) at 64 chief concern: how to save for retirement
Millennials (26-41) age 61 chief concern: how to improve my credit score
Generation Z (18-25) at 57 chief concern: how to do my taxes
#2 concern for all four groups: how to avoid fees and reduce debt

 

[Walking W]

A penny saved is a penny earned. Index funds are low cost and efficient.
By design a Total Market Index Fund will never be the top performing fund in any year. But more importantly it has never been in the bottom 50% either. Historically you can expect it to finish in the top 1/3 and I think being above average long term is an important goal and TMIF lets you achieve it without wasting a lot of time trying to beat the market.
In my opinion, when in doubt the Total Market Index is the way to go.

I'm nearly 68 now and have been investing nearly ever since I started working back in the 70's. There are several things I would tell a new investor. 1. Save as much as you can. Take control of your spending. Know where your.money goes. You will he surprized how much you wasting your money on things you don't want or need.
2. Make sure you have good medical insurance. Medical bills are a major cause of bankruptcy.
3.make sure you have an emergency fund in cash before you think about investing.
4. Your first investments should a the lowest expense ratio broad market funds or ETF's (think SPY for the S&P 500) you can find. I use ETF's for a major part of my investments, even though I have the ability to analyze publicly available corporate data for myself.
5. After the first 4 are covered, I invest some in higher risk/reward individual stocks. Not Crisper which really is like a lottery ticket. More like Amazon, Apple, Chevron, Wells Fargo.
6. A very amall amount can then be placed on the real roulette table of stocks that may either go great or bust.

Just my two cents.

 

[Son of Butch]

Your first investments should be the lowest expense ratio broad market funds or ETF's (think SPY for the S&P 500) you can find. I use ETF's for a major part of my investments, even though I have the ability to analyze publicly available corporate data for myself.

I enjoy watching Jim Cramer 67 Mad Money, he's entertaining, informative and optimistic (There is always a bull market somewhere) I respect that he answers questions directly and gives some of his picks and explains why. But critics say his subscription service has not been able to beat the S&P 500 in more than a dozen years. An independent reviewing company concluded the results were so close it couldn't determine if he beat the S&P 500 or not, depending on when the trades were executed.

IF a smart professional picker like Jim Cramer can only tie vs the S&P 500, then what chance do I have to beat it?

 

[Walking W]

I enjoy watching Jim Cramer 67 Mad Money, he's entertaining, informative and optimistic (There is always a bull market somewhere) I respect that he answers questions directly and gives some of his picks and explains why. But critics say his subscription service has not been able to beat the S&P 500 in more than a dozen years. An independent reviewing company concluded the results were so close it couldn't determine if he beat the S&P 500 or not, depending on when the trades were executed.

IF a smart professional picker like Jim Cramer can only tie vs the S&P 500, then what chance do I have to beat it?

I watch Jim Cramer every day that he is on. I also pay for extra advice/access through the investing club. He is good but has his blind spots. His reliance on personal relationships with CEO's can lead to big losses. Think Bausch Health.
I couldn't see putting money into a company that had that much debt but Cramer kept buying it in hopes that the split up would somehow release the separate companies to climb higher. The IPO of Bausch & Lomb bombed because of poor timing and because, especially with the fed tightening and interest rates rising, corporate debt is a real killer.