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[ironchef]

Do you outperform your Long term holdings with your trading component? If you are doing that then why are you Buy and Holding, and if not why are you trading?

1. Yes, by a mile. 2. Diversification. 3. I trade these days for the challenge.

 

[ironchef]

There's a big problem here.
The markets are dynamic, never static. What this means, what happened once need not happen again.
Hindsight is a wonderful thing.
'Growth stocks' are stocks which are basically newcomers on the scene and their price charts often go through the roof.
After many years they no longer are growth stocks and languish, held often by old timers for dividends.
(Don't start me on dividends, imo a total waste of time but that's another long story).
Buy and hold strategies are a waste of time and you will likely get burnt.
We've had many super years of a bull market, it won't last forever, one day the piper must be paid.
That will be the day there will be much weeping and gnashing of teeth for the lazy buy and hold investor.

True. I was lucky.

A word on dividend. If you bought $10K of SPY 30 years ago, that $10K would have been $100K today. 30 years ago, the annual dividend on the $10K was ~$200. Today the dividend would have been ~$2K or 20% that $10K every year.

If I were more conservative, I would keep the 80% in 30 year treasury, like Taleb's barbell strategy.

 

[ironchef]

Guys, I was just trying to be helpful, I don't want to defend what I posted. If you don't like what I wrote or don't agree, no big deal, we can move on.

I am not selling trading books, not trying to sign anyone up for a web based service or looking for a paying coaching job. Or for that matter joining a trading group.

 

[deaddog]

1. Yes, by a mile. 2. Diversification. 3. I trade these days for the challenge.

I'm an anti diversification guy. Put your eggs in one basket and watch that basket very carefully.

Diversification does not control risk, have a method of getting out of a down market and protecting your capital controls risk.

If your goal is to have a diversified portfolio with little to no risk control then you're good. If you goal is to accumulate as much capital as possible with little to no risk, why would you hold a class of assets that underperform another class of assets.

If I were you I would move to a greater percentage of trading vs Buy &Hold.

Not coming down on you, I just like to challenge conventional wisdom.

 

[ironchef]

I'm an anti diversification guy. Put your eggs in one basket and watch that basket very carefully.

Diversification does not control risk, have a method of getting out of a down market and protecting your capital controls risk.

If your goal is to have a diversified portfolio with little to no risk control then you're good. If you goal is to accumulate as much capital as possible with little to no risk, why would you hold a class of assets that underperform another class of assets.

If I were you I would move to a greater percentage of trading vs Buy &Hold.

Not coming down on you, I just like to challenge conventional wisdom.

I know @10_bagger won't understand the feeling but maybe you do. When one reaches that stage in life with total financial freedom, diversification is for capital preservation.

I respect you, @themickey and enjoyed reading and following both your posts. Go easy on me.

 

[themickey]

Guys, I was just trying to be helpful, I don't want to defend what I posted. If you don't like what I wrote or don't agree, no big deal, we can move on.

I am not selling trading books, not trying to sign anyone up for a web based service or looking for a paying coaching job. Or for that matter joining a trading group.

Yeah, agreed, we're just having a mutual discussion.
Imo though, in life, you've always gotta be moving.

 

[10_bagger]

1. Yes, by a mile. 2. Diversification. 3. I trade these days for the challenge.

first off, I appreciate your post and what u talked about, including your investment philosophy. I find some contradictions in the things u So I’m curious as well like “deaddog”.

In one of the private messages “ballsofgold” mentioned to enter into the group chat only experience Traders who can offer value. U immediately said bye I’m out. I asked u why are u leaving if noobs are not allowed and u said u outperformed based on a buy and hold strategy using margin since 2009.

now “deaddog” asked about ur performance u and said ur swing trades are outperforming by a mile. Considering the fact that spy is probably averaging around 20 percent a year before covid since 2009 this is implying u are making at least 40 percent a year swing trading. U see the contradiction?

I know u are trying to be helpful so I’m not attacking U in any way. I’m just curious.

 

[10_bagger]

I know @10_bagger won't understand the feeling but maybe you do. When one reaches that stage in life with total financial freedom, diversification is for capital preservation.

I respect you, @themickey and enjoyed reading and following both your posts. Go easy on me.

I’m not there yet chef. I’m only 39 and I’m working towards financial freedom. Maybe in another 5-10 years. I do have financial security but not to the point where I can retired and maintain my current lifestyle.

U made some assumptions about me, so I’ll do the same. And when I’m saying I’m not at the point of financial freedom I’m not saying it in a way where I think u are better than me at trading. Based on what u say, I bet u are at least 15-20 years older than me.

With that said, I like u chef so don’t take what I say the wrong way. Like Mickey said, we are just having a discussion.

 

[deaddog]

I know @10_bagger won't understand the feeling but maybe you do. When one reaches that stage in life with total financial freedom, diversification is for capital preservation.

I respect you, @themickey and enjoyed reading and following both your posts. Go easy on me.

Actually I'm at that stage of life. Officially an "Old Fart". I retired early in 2000 with a buy and hold mentality and soon found that half my nest egg had disappeared. I didn't panic and sell at the bottom but I realized that I wasn't comfortable with a buy and hold strategy.

I came up with a market timing strategy that kept me out of the 2008 melt down and also had me mainly in cash in Feb/Mar of this year.

My portfolio is a poorly diversified equity portfolio. To me there is no such thing as a safe stock. There can be quite a difference between a good company and a good stock.

Do I get whipsawed form time to time? You bet! but I'm more comfortable in cash with the market going up than I am in stocks with the market going down. It's much easier to lose opportunities than cash.

You have to do what allows you to sleep at night. Do what's right for you!!

 

[ironchef]

first off, I appreciate your post and what u talked about, including your investment philosophy. I find some contradictions in the things u So I’m curious as well like “deaddog”.

In one of the private messages “ballsofgold” mentioned to enter into the group chat only experience Traders who can offer value. U immediately said bye I’m out. I asked u why are u leaving if noobs are not allowed and u said u outperformed based on a buy and hold strategy using margin since 2009.

now “deaddog” asked about ur performance u and said ur swing trades are outperforming by a mile. Considering the fact that spy is probably averaging around 20 percent a year before covid since 2009 this is implying u are making at least 40 percent a year swing trading. U see the contradiction?

I know u are trying to be helpful so I’m not attacking U in any way. I’m just curious.

If you read some of my other posts you will understand. Let me try it one more time.

You can easily outperform SPY starting in 2009 if you could use borrowed money with low interest rates. It is easy to backtest that hypothesis. Now instead of margin you traded options.

The "edge" is a combination of leverage + bull market: The macro bet some of us made that this bull market would exceed everyone's expectation is where the profit came from. That is why I always said I was just lucky, I don't have any real trading skills.

By the way, SPY CAGR since 1-1-2009 was 14.1%. I did better.

Let's focus on your journey because mine is done.