What’s wrong with buying and holding the SPX500?

[Robert Morse]

It’s spare cash actually.. since it’s going up, might as well, instead of leaving it around doing nothing, but there has been 2 major crashes, other than that, it seems solid, long term hold, on a 1:1 leverage ratio. Curious about the risks of doing this.

I would think this is obvious.

 

[Turveyd]

Never guaranteed, you could have 5 down years and take 10years to get back to BE.

Atleast DayTrading, your in control or atleast the illusion of control.

Will take up a loss less of your time though, so if your already rich and not trying to trade to get rich, then more time to spend the rich, if you poor then no money to spend, might aswell keep plodding on!!

 

[zdreg]

Taxes, divs, no comms, positive expected return, and guaranteed not to underperform the market.

...downsides are we can't prove ourselves as elite traders.

Seems like an obvious choice to daytrade.

you can do both. use the SPY in your account for intra-day margin to day trade.

 

[Visaria]

Ask yourself what can go wrong with that kind of strategy and devise an exit plan too ... The Japanese who invested in their index in the late eighties still haven't got 60% of their money back ...

Most of them are probably dead by now.

 

[cvds16]

I remember that period from first hand and I am far from dead, statistically speaking

 

[Robert Morse]

Most of them are probably dead by now.

That comment was not funny, but this is.

 

[ironchef]

Ask yourself what can go wrong with that kind of strategy and devise an exit plan too ... The Japanese who invested in their index in the late eighties still haven't got 60% of their money back ...

You must be a professional money manager.

Us mom and pop retail investors/traders never have the luxury of putting a big chunk, lump sum into an index and sit on it for 30 years. The way we small guys invest is putting a small amount into it monthly and after 30 years, start taking it out. So, even for Japanese retail investors, they should be getting more than 60% of what they put in?

 

[srinir]

If it were a taxable account, I might look at long ES futures for the 1256 contracts taxes.

For a buy and hold investor, I don't think this is correct. Long term gains tax rate is still smaller than 1256 contract taxes. Not to mention hassle of quarterly roll and retail commission rates. SP500 etf can be had for 3 to 4 bp these days.

 

[Visaria]

Buying futures makes sense if you are restricted from putting more money into the tax free retirement account.

 

[lawrence-lugar]

What’s wrong with buying and holding the SPX500?"

This is ET; diversification and buying and holding makes me Cringe. -- Trade for actual money.
Trade to make a killing in the shock market.

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