Mentorship (4th year still not profitable)

[777]

For the average person, sure. Past 90 years the S&P has done 9.8% annualized apparently. All daytraders aim for higher returns and some succeed.
I had a similar debate with a family member. He pointed out the average success rate and I replied with "I don't care about the average, I can do more and do it better". If it's arrogance or intelligence depends on the results. So far I've outperformed B&H. I can't speak for other people because I have no way of knowing how much effort they put into it.

You're also applying bias here as it's easier to recommend long-term investing after the markets have had a good run. In early 2009 barely anyone would've agreed with you and you might have thought differently as well.
Reminds me of the documentaries from the tech bubble when people were making fortunes in weeks and laughing about buy and hold. A year later many were bankrupt.

There's also absolutely no point in comparing to Berkshire. They use OPM to make these returns. Can't be compared to an at home trader or investor, as others have already pointed out.

Thank you for your reply.

I was brining up investing in Berkshire for 30 to 40 years as an example of a plan the the average guy who wants to be involved in the market would be far more likely to be successful with.

From your posts I can see you are not the average guy who sees himself as a soon to be daytrading wizard.

As I acknowledge in another post, for just the right person... yes...

The SOES Bandits cleaned up and many has a mentor. On a longer time frame, many of the Turtles (with a mentor) did well. Stanley Druckenmiller, Jim Simons, Blair Hull all starred out "trading".

 

[speedo]

This is probably not the best site for investment advice although there are obviously quite a few on here who are unclear on the concept of short term speculation.

 

[777]

Buy & hold for building wealth is but a dream built on fantasy.
The majority of shares (maybe +80%) for example on the ASX are just crappy underperforming jerky (random) stocks. I would imagine the same type % of underperforming shares would be found on most other stock exchanges.
None of the major indexes are buy and hold indexes, they are all refreshed approx. every 3-6 months.
If you were to list all shares on for example nyse and filter them into those which consistently trended, didn't suffer major drawdowns and gave for the most part returns of maybe 40% pa, and were not overly volatile (forever knocking out your stops) you would discover the majority would not make the grade.
So buy & hold is for the most part wishful thinking, it would only work if one were very skilled at picking the creme of the creme stocks. That's rather difficult for most lay people as they lack the tools and experience, let's say you chose 80% consistent winners, the other 20% which proved in hindsight to be the archilles heel and these would have a major effect on your profits.

Agree with your observations on how the market works and how hard it is to pick longterm winners.

Long time ago if you had seen the future of automobiles, 2000 companies have come and gone. Had you thought airlines were here to stay and bought all of them along the way you woulf have done poorly. Had you believed the US, Televisions and radios were not going away... what happened to the US makers of those two things ?(paraphrasing Warren Buffett on all of this).

Even being right on an industry or concept, it is not always easy to pick the winners.

That is why I specifically mention low cost ETF's or Berkshire Hathaway in a tax efficient account and holding for 30 to 40 years as a plan the average person can do.. has the skill to do.. if he has the fortitude born in part by understanding.

As usual, I enjoy your insightful comments and do not disagree with the facts you write.

 

[777]

More to the poster of this thread:

I applaud your search for a mentor! ))

How have things been going?

 

[deaddog]

Buy & hold for building wealth is but a dream built on fantasy.


None of the major indexes are buy and hold indexes, they are all refreshed approx. every 3-6 months.

So buy and hold the index. Let S&P manage the portfolio. SPY has a MER of 0.09%.

If you can't outperform SPY you should not be trading.

 

[777]

So buy and hold the index. Let S&P manage the portfolio. SPY has a MER of 0.09%.

If you can't outperform SPY you should not be trading.

True.

Unless you are one of the few who has what it takes and is seriously learning.

The person who started this thread seemed so sincere and it is so often so hard to turn things around in many areas after four years of serious struggling. Bad ideas and habits become ingrained.

I like sincere people who try hard and ask questions.

Sometimes I reflect and learn from their questions and the answers they receive.

Wonder if he found the teacher he searches for (?)

Maybe I will pm him him and ask.

 

[themickey]

Agree with your observations on how the market works and how hard it is to pick longterm winners.

Long time ago if you had seen the future of automobiles, 2000 companies have come and gone. Had you thought airlines were here to stay and bought all of them along the way you woulf have done poorly. Had you believed the US, Televisions and radios were not going away... what happened to the US makers of those two things ?(paraphrasing Warren Buffett on all of this).

Even being right on an industry or concept, it is not always easy to pick the winners.

That is why I specifically mention low cost ETF's or Berkshire Hathaway in a tax efficient account and holding for 30 to 40 years as a plan the average person can do.. has the skill to do.. if he has the fortitude born in part by understanding.

As usual, I enjoy your insightful comments and do not disagree with the facts you write.

A good example right now are lithium stocks.
What could go wrong with lithium? Nothing! Batteries and lithium are the future!? Right?
If you bought lithium 5 years ago, you would be earning 6%pa on initial investment approx at this point in time.
https://www.barchart.com/stocks/quo...e=0&sym=LIT&grid=1&height=500&studyheight=100

 

[destriero]

A good example right now are lithium stocks.
What could go wrong with lithium? Nothing! Batteries and lithium are the future!? Right?
If you bought lithium 5 years ago, you would be earning 6%pa on initial investment approx at this point in time.
https://www.barchart.com/stocks/quo...e=0&sym=LIT&grid=1&height=500&studyheight=100

Sure, all forms of EVs use some sort of lithium. All that I know is that it's not LiFePo batt as the energy density is too low. Would you go after a resource investment for 3% over Treasuries?

 

[Simples]

A good example right now are lithium stocks.
What could go wrong with lithium? Nothing! Batteries and lithium are the future!? Right?
If you bought lithium 5 years ago, you would be earning 6%pa on initial investment approx at this point in time.
https://www.barchart.com/stocks/quo...e=0&sym=LIT&grid=1&height=500&studyheight=100

Looking at volume, the majority of random buyers would be down from Oct 2017..

 

[themickey]

Sure, all forms of EVs use some sort of lithium. All that I know is that it's not LiFePo batt as the energy density is too low. Would you go after a resource investment for 3% over Treasuries?

My point, anyone contemplating buy & hold of stocks, it's a lazy form of investment and laziness has it's price, basically a random outcome, may as well buy lottery tickets with the money you would otherwise spend on holding positions.
On the other hand, buy & hold with the simplest bit of homework (but that too would be difficult for a non financial literate person) and drop in maybe a loose weekly trailing stop would be better than nothing. One of the metrics I use is historical volatility, looking back over the last couple of years. If it has been too volatile, don't touch from an investment perspective. Unfortunately for them most lay investors are not able to get this information.