Safest way to make 1% per month

[tonyf]

Option premia is tax free in the UK? That's insane. I would only get stock exposure thru synthetics.

I did not say that. I said free of US withholding tax on income. CGT is another kettle of fish.

 

[tonyf]

Very interesting thread will have a read through and definitely add to my watchlist

Everyone is chasing the dream of early retirement. Beating the stock market by a very small margin is a real challenge and push us all to think differently....not easy.

 

[tonyf]

Is it just me or are most of these replies outside the question? To answer, you need to tell:
Is the goal 1% per month or 10% per year or 100% over 10 years? Are you compounding? I ask because in 2020 it would have been relatively easy to reach 75% and have 9 years to earn 25%.
Several long term, large cap would get you 100% in 10 years, including GOOG, MSCI, CMG, AMZN, etc..

Oh and next time wear your face mask!

That's a very good question - I kept it simple. Let's call it 10ys or 1 full economic cycle to make things interesting. Forward looking of course, hindsight is no good.

 

[maxinger]

The safest way to make 1% per month

--->

The easiest way to lose >> 1% per month
is by investing and trading.
Because the majority will lose money.

 

[tonyf]

More info please.

Is he looking for a steady income or does he want a 12% per year compounded return?

Are we talking a million dollar account looking for 10k a month or a 325k account that he wants to turn into a million in 10 years.

Is he willing to trade the account or is he looking for a buy and hold strategy.

The compounding/drawdown question is irrelevant in my view at this stage, it has a deminimis effect anyways.

let's call it $1m for guidance.

He is a self-employed structural engineer (bridges, tunnels, etc...) and interested in the financial markets - well equipped in resources, time and skill to either trade or buy and hold.

 

[VicBee]

Like I said... Buy and hold large caps for 10 years, you should beat that 100% return.

 

[maxinger]

Like I said... Buy and hold large caps for 10 years, you should beat that 100% return.

imagine you bought GE at $450, 20 years ago.
GE is a blue chip, large cap company.


Now it is worth $100 only.


Those who bought Lehman's Brothers
at around $40 to $80 in ~ 2005 and hold very long
regretted buying a blue-chip company.

Then there is Baring Banks, a very established reputable bank
and ......
within a few hours, the stock price dropped to zero.

And ....

 

[VicBee]

imagine you bought GE at $450, 20 years ago.
GE is a blue chip, large cap company.


Now it is worth $100 only.


Those who bought Lehman's Brothers
at around $40 to $80 in ~ 2005 and hold very long
regretted buying a blue-chip company.

Then there is Baring Banks, a very established reputable bank
and ......
within a few hours, the stock price dropped to zero.

And ....

GOOG (which I gave as an example) was at $262 10 years ago, it's at $2916 today. So what's your point?

 

[zdreg]

I was challenged last evening in a pub (without face mask!) on what would be the "safest approach" to make 1% per month over the next 10 years. Not more, just 1%.

That's about 9 to 10% net of inflation per year or about 1.5x very long term US equity index return.

I was not able to answer on the spot but promised the dude to raise the question here.

You should find more interesting companions to talk to at the bar. Capish?

 

[Sig]

A 'safe' strategy to make those mediocre returns is to own a multifamily building.
The cash-on-cash return on those is typically 10%-12% per year.

Is it really though, if you went out and bought one today....and factored in all your operating costs and vacancies using actual historical values? I know folks who bought even a couple years ago might see this. But that's really reflecting the fact that real estate prices popped and they aren't paying a note on the current market value of the building while getting market rents. That cuts both ways, of course, as we all remember from 2008.