/biz/ - Business & Finance

What did Vanguard do? Link?

Lol, sure, enjoy that -75% on individual stocks vs -20% on the index.

>>49343302
OP is right, you freaks need to be culled. Index investing is a giant scam

This is not a factual take.

>>49343453
Yes it is. The market lived off of cheap debt. 80% of the index is made up of losers like OP is implying

>>49343102
>yeah let's give Vanguard all the votes and power.
t. "redpilled" /pol/jeet with $500 poorfolio

>>49343621
>80% of the index is made up of losers
that is true, but it doesnt matter. the 20% make 80% of the gains and you wont be the one identifying the 20% in time

>>49343631
You wish

>t. 7 figure anon

>>49343453
Oh but it is. Just ask Burry. Index investing is for plebs and does not work long term. The Q's took 20 years to get back to green

>>49343102
Is this true? My entire plan was that if I "make it" which I define as getting more than $1 million in crypto, I would cash out and put it all in an index fund and live off the interest/dividends. Is this no longer feasible?

>>49344802
the entire market will shit its innards out and with the index you are invested in everything of the market that sucks ass.
after that line will probably go up again

>>49344512
you dont have to pick 100% of the 20%.
Just cut the clear losers and zombie corps from the index and you outperform

>>49343443
How?

>>49343621
> the index
You have no idea what you are talking about.

>>49345009
kek this
>>49344990
because its not a get rich quick scheme

>>49344947
Is there an index for the clear losers? I don't want to rebalance all the time

>>49344947
So just pick a quality factor etf?

iShares Edge MSCI World Quality Factor UCITS ETF: „The Fund seeks to track the performance of an index composed of a sub-set of MSCI World stocks with strong and stable earnings.“ But that ETF consists of only 295 holdings.

>>49343102
This, people really don't understand how damaging it is to have all that capital sitting in a handful of companies making all the votes. The corporate system literally stops working.

>>49343166
>offer index funds for investment
>pensions and boomers buy in
>wind up with over $10 TRILLION in capital
>like 40% ownership of ALL companies because they buy stocks in proportion to the index funds
>some CIA plant or SJW gets in charge at one company
>now every company has to dance to the same tune because their boards are more than 50% co-opted
>focus shifts from profits to social justice bullshit
And the fed keeps the carousel turning with unlimited funny money so they're all zombie companies anyway.

>>49344947
That's rolling the dice every single year and it has serious tax drag.

>>49343102
I mean let’s be serious
Index funds worked last few years
Depending on the index your drawdown is still manageable if there is no giga chad recession inc

Question is how long will bear last. This correction is great for buying value socks cheap, but I don’t know when stocks are cheap enough, right now they are not

https://youtu.be/K8siASXfeyU
Index buying and selling activity is tied in near totality to liquidity flows. They fundamentally increase market volatility because of their sheer size. They exist on the sole strategy of Fed front running.

>>49345195
>but I don’t know when stocks are cheap enough, right now they are not
Read Benjamin Graham. No, NOT people who say they've read Benjamin Graham, actually read what Benjamin Graham wrote.

>>49343102
Fuck off. They've made me a lot of money over they years. Stay mad poNMX8Tor fag

>>49345125
This anon gets it. It's a systemic problem

>>49345195
Growth stocks only work when fed rates are 0. This era is over. Index will massively shift in the next 5 years

>We are finally going back to stock picking and individual investing again.

Proof?
Individual investors are doing much much worse right now than the indices. Their SPACs and unprofitable tech stocks and FANGs are getting killed.

>>49345125
The market doesn't work

>>49345195

Developed market value stocks are at PE 10. Emerging Markets value are at PE 7. They are not gonna get any cheaper than that my man.

>>49344990
Because you can do the same thing essentially, by buying 20 different stocks, and holding forever.

>>49345843

That doesn't work because of the skewness of stock returns. Most stocks are absolute crap and delivers negative performance over their lifetime. You need to hold the mega winners like Apple otherwise you will get killed.
There is absolutely no way to build a sound investment strategy around holding 20 stocks.

>>49345878
This. The two strategies that currently work in this market is gambling on vol spikes and chasing beta on single stocks via options, or sitting in an index fund and praying for yield. Any other strategy can't outpace inflation or is too risky.

>>49345992
Are you a Vanguard/Blackrock salesperson? Top kek, you can easily buy a basket of dividend aristocrats like PG and outperform. Shameless index cultists

>>49346096
>you can easily
Then do it, faggot. I'm here to have a discussion, not listen to your financial advice. Forecasted returns on hypothetical portfolios are meaningless.

I dump all my investments into VTSAX and never worry about it
The ideal investment strategy for the common man

>>49346266
You and your kind repeatedly scream that index investing is the only way. I am laying out proof that it's not true.

>>49346295
What happens when VTSAX goes up 3% for the next 5 years?

>>49346452
If VTSAX goes up 3% for the next 5 years I'll just accept it, because that's the way the market is moving.
VTSAX is just designed to track the entire market after all

>>49343102
Its been a long time coming. Lot of them dont even realize they are actually a lot more down then the fund makes it look. Oil/energy is essentially keeping the SP 500 a float. So they all thinking its fine to keep buying in not realizing that as soon as OPEC changes their tune their portfolio is plummeting down.

Can someone explain for the illiterate why index funds are good/bad?

A simple pro <-> contra list in bulletpoints would suffice

>>49346745
When you buy a fund you buy the bad stuff and the good stuff. The bad stuff can keep surviving because they can get capital when in a normal market they would have gone bust. But the real bad thing is you are giving voting rights to Vanguard and Blackrock. You arent buying shares in companies. You buy shares in a fund run by vanguard/BLROCK. They buy and own the shares so they get to vote.

>>49346604
>JUST designed to track the entire market

And that's not a good thing

>>49346681
They're being propped up before rates really start to take off and gut all growth stocks. Elon's warning is just the start today

>>49345125
Gotta hand it to them though, they saw that people in the 1980's were investing in stocks and created mutual funds as a way to keep voting control for themselves. Pure evil.

>>49346886
tracking the market IS a good thing
index investors like myself believe that over the long term the market trends up
also, we believe it's just about impossible to consistently pick "winners"

This OP was typed by bankster hands

>>49347135
Yep, very few can beat the market long-term. Add in extra management fees and index funds have generally been a good way to go. The issue OP references is the power it gives these fund companies. It's too much.

>>49346745
The market as a whole goes up more than it goes down over time. The average investor therefore makes money in the long run. The average investor, by definition, holds the market cap weighted ratio of every stock on the market. You can copy that portfolio with a single market cap weighted total market index fund, they are available at low cost. This will outperform 50% of active investors on average, weighted by capital.
Deviate from this strategy if you believe you are smarter, more informed, luckier or have some other edge over the average investor. Half the people on this board think they can predict the future and therefore deviates 100% from this strategy, they will get rich if they're right.

>>49347624
The immense amount of proxy votes they have has broken the system

>>49347657
If I hold a portfolio of dividend aristocrats and value plays, ala Buffett, I am not losing

>>49347814
Yep, it's literally broken capitalism. Corporations don't have to worry about their customers or profits when they're owned by VanguardBlockrock who gets money directly from the Fed.

>>49347814
Buffet has been trailing the market for the last several decades. If you are literally better than old Buffet at picking dividend stocks then yes, you will beat the market. Good luck. (Young Buffet has an amazing record, old Buffet is merely "not bad")
An index fund is a cheat code for getting the average return, which historically has been pretty good. It's the easiest way for most of us who are not that informed to get a decent result from stocks. It's also what Buffet recommends for most investors.

>>49345464
Everything is FED watching these days. The money is broken yo. Heard of bitcoin?

>>49345125
This guy is smart

>>49344802
firstly 1 mil in something like vti is only $14,300 a year in dividends which obviously isn't enough. Youd do better putting some in O and get 4% a year which off 1 mil would be $40,000

>>49346096
>you can easily buy a basket of dividend aristocrats like PG and outperform
sweaty most pro mobey managers cant beat the market but im sure you got it all figured out

>>49347624
dont buy vanguard or blackrock then theres plenty of alternatives
a lot of these big etfs arent even available for yuropoors i have to buy ishares because i cant get vanguard

>>49345125
>The goyim know

>>49349682

>>49346861
>He thinks his broker isn't voting for him and doesn't deliberately obfuscate the process of changing that

If you want to argue against passive-investing then you're doing a terrible job of it. Next time read up on investment trusts and REITs if you want to argue against indices.

>>49349421
This x1000. Immense amount of capital needed in VTI or VXUS just to live off of

>>49348245
>index is a cheat code
>average return
>don't invest in TSLA for a 100x goyim

How about you kys and let us pick stocks in a free market fag

>>49349731
Just a barell roll, and call it a day

>>49347814
Fully agree with the index vs single stocks.
Can you give a source or list of companies you like to keep for the long long term?

>>49351247
Start with a list of dividend aristocrats like PG KO PEP MO and then add in your deep value plays like BRKB V MA LOW

>>49345125

huh so society sucks because people are lazy

>>49351588
Always has been

>>49351165
Work on your reading comprehension. I literally said you'd be rich if you're right in your picks. But the market is just the sum of all the stock pickers, so you better have an edge.

>>49345786
caithy wood != all individual investors

>>49345125
first part completely agree with
second part reads like an schizo autist desperately in need of his meds

Index Funds were a great idea and John Bogle was a decent human being who wanted to offer easy investing with good returns to the masses.

Now they've gotten too big though and instead of passively tracking the market, they are the market. Bogle also gave up the ghost and the new crowd running Vanguard will happily use their voting power to play politics and push ESG idiocy on every corp they dominate.

>>49353234
it's a matter of record that it is like that, blackrock is the same way, do you think all these companies going woke progressive was because they really believe in what they're pushing?

>>49343102
Agreed, fuck both vanguard and blackrock and the ilk. Abuse their power, assets, and scam their consumers. Time to bring fair rates and distribution back to individual investors. Why are they allowed to buy real estate and get all the voting power etc? Suck my 8in fat fucking COCK
>VERIFICATION NOT REQUIRED
thx jesus

for me its vig

long term dividend appreciation is a great filter for the shit companies. just look at these top holdings:

1 Microsoft Corp.
2 UnitedHealth Group Inc.
3 Johnson & Johnson
4 Procter & Gamble Co.
5 JPMorgan Chase & Co.
6 Visa Inc.
7 Home Depot Inc.
8 Mastercard Inc.
9 Coca-Cola Co.
10 PepsiCo Inc.

quality cash printing machines. you miss out on the new hype like telsa/apple/amazon but you can always add these as individual stocks.

>>49345843
>Because you can do the same thing essentially, by buying 20 different stocks, and holding forever.
No you can't your trading costs would be far higher than if you just bought the ETF

>>49355230
>fair rates

some vangaurd rates are less than a tenth of a percent

at this point shouldn't index funds have negative fees because you are essentially selling your voting rights to a big corporation

>>49353234

Vanguard's beginning to shift little by little to a more active role in voting even with passive funds. They originally stuck by board decisions to not rock the boat.

It does lead you to wonder who gets to make these decisions and why?

>>49345125
this this this no one is able to vote nor can they sell options scam city

>>49343302
Fugg off Kige :DDD

I am the God of investment

>>49343102
>The era of index investing is ending
lol what
>Thank GOD, bogleheads and index cult members were ruining it for everyone
you'll be okay little brother, did you miss your nap?

>>49345125
>it's not the jews or wef, it's an sjw at vanguard
Retard

>>49354795
I think about how he was a lifelong Republican and how he was forced out of Vanguard in the late 90s.

>>49343302
Enjoy giving away all your shareholder rights to blackrock so they can have unlimited power over the economy.

Maybe index fund investors (the majority of the population with their 401ks) do deserve to starve to death for giving away all that power to a few filthy Jews. Why hate the Jew when the boomer has given them all the power they would want.

>>49343102
Love how shills specifically go after these threads. I'm sure they are WEF/Klaus fanboys.

>>49345505
Just buy the individual stocks, equally weighted in a basket yourself. Go ahead, buy all 500 of the companies, you'll find that you're just a lazy retard who doesn't know what a share is for.

It's like giving your enemy your vote, so they can shove LGBTQBRAAP ads in your face using your own money. You deserve have estrogen in the water supply.

>>49347961
This kind of corporate consolidation by state entities has a name, it is textbook Fascism. Just globohomo Fascism.

>>49343102
Its something that is promoted because normies can't into investing. Its literally the "dumbest" approach to investing, and is good enough for normies to just dump their money into.

But yeah, if you are serious about making money, index funds are mostly useless. However, value investing and fundamental analysis wins the day, not shitcoins and memestocks

>>49343302
>thinks the only alternative to indexing is memestock bs
Value stocks are doing better than the SP500 as a whole.

>>49343443
based

>>49343453
Mike Green, Eugene Fama, and Ken French all disagree with you. Even Bogle admitted before he died that indexing is likely going to distort the market as the trend of indexing continues.

>>49343621
This. Quality minus Junk beats market weighted indexing.

I mean the studies that track how day traders/stock pickers do paint a pretty grim picture though. You would think that on average that most day traders would do about the same as index, but most studies show that only a very very small percentage outperform the market for long periods.

<5% typically. Some show that over 1+year periods only 1% ish people outperform.

High skewness in individual stocks +Behavioral biases + Trading against quants, Hedge funds, Nancy Pelosi means that your small fry NEET stands very little chance.

By stock picking you have a greater chance of hitting a 10x or 20x return but on average over many years you will surely lose.

>>49343102
This is a fallacy.

The bad stock pickers always outnumber the good stock pickers. Which is why most stocks can't outperform treasury notes.

inb4 hindsight bias
inb4 new paradigm
inb4 overleveraged idiots

>>49358034
You overestimate the effect of indexing on price of stocks. In terms of daily trade volume(which determines price) index funds are still small portion of it. That's because they are not turning over their portfolio's daily.

>>49345125
imagine for 1 picosecond that all boomers decided to buy gamestop gg end of days

>>49358121
I owned a small cap value (+other factor) index fund (AVUV) that had GME as one of its stocks. When it popped it suddenly was 2-3% of the fund.

>>49344802
>>49344802
If you don't want to get into serious investing (statistical arbitrage), you can look into value oriented ETFs, like SCHD and DIVO.

They provide pretty good dividends and their underlyings are less volatile than the overall market. They should outperform as the market continues to be crabby.

>>49344990
Value factor> market weighted indexing

>>49345009
you know he is talking about the SP500.

>>49345106
When people attack indexing, they are attacking market weighted indices.

A quality weighted etf is not what is being attacked. In fact, factor based investors would likely prefer them, since they like specific categories of stocks, rather than focusing on single companies.

>>49349421
Vym or vea retard. Growth tech stocks which dominate the indices you mentioned don't pay dividends.

>>49343102
One of the problems with stock picking is you'll never be able to know the proper exit point if you do actually pick one of the high flyers. And even if you do time the exit perfectly before it dumps, you have to 1.) pay taxes which decreases your compounding returns and 2.) decide what to rotate into. Indexing avoids both of those problems. And it also eliminates the scenario where you were dead fucking wrong about your pick and it dumps massively.

In retrospect, it's easy to know that you should've sold TSLA at $1200, but you had to have been a degenerate dipshit to hold that stock in the first place.

Degenerate stock pickers/gamblers can't refute these points with any logical argument.

>>49349421
> Conveniently ignores higher REIT tax rates

Fucking christ, learn the difference between ordinary income and qualified dividends before you give this advice.

>>49345164
>you can't buy and hold value stocks for the long term

>>49345195
they worked because the Fed/government inflating the bubble. Value outperforms in normal market environments

Plenty of stocks are cheap. Just not the ones that are popular (think INTC instead of AMD etc).

>>49345786
Reddit tier crap is not what we are talking about.

Selecting value stocks in companies that actually make money is.

>>49358166
> value factor
Have you ever checked out Avantis?

>>49345878
Again, he is talking about 20 companies that actually make money, not random crap like the major indices do.

And it is easy to filter out crap. Just look at EV/EBITDA, ROIC, Quick Ratio, and Debt/Equity ratios.

I agree very heavily with Burrys take on this. Essentially index funds pump and dump the market with their volume, stocks that are included in popular etfs and other passive investments tend to absolutely skyrocket in volume, driving their prices up really high. They then provide liquidity for people to dump into, offerings, ect. Knowing that there’s basically unlimited liquidity available to dump into. Companies from emerging markets that get put into stuff like the MSCI or other etfs see their stock values absolutely skyrocket, as people front run the ETF inclusion.

This is because you have about a trillion dollars in etfs chasing after only billions in company stock. This drives up the price immensely in those underlying stocks. This is the cathie wood strategy, pump lots of money into microcaps and force them to go green.

It’s deadly, extremely deadly. People in this thread are talking about shit companies holding down your gains, when we enter a bear market it’s more like these companies will all go bankrupt and your investment in a passive etf will not stop bleeding despite many companies being fine

>thinking we need stocks at all

Its all a modernist lie. What the fuck is a "stock"?

>>49358232
Holding the index means you already profit from sector rotation w/o needing to trigger a taxable event. Do you plan to rotate black to growth if the Fed reverses course? How will you know when to rotate?

You're underestimating how difficult it is to time a rotation from growth to value (or vice versa), and how tax-inefficient that can be.

>>49358232
The problem with hodling value stocks is that they are typically more risky and volatile than growth stock. This may not seem true right now because growth is very overvalued, but historically this is true.

Therefore you need a large enough portfolio to diversify that risk away, otherwise you are just playing lottery.

At that point just buy a Index ETF that tracks SP 600 or a multi factor tilted ETF by Avantis or DFA.

>>49348245
>>49348245
Part of that is because Buffet is now a whale. He pretty much is limited to big name large caps. He famously admitted that it is way easier to money off of few million than the many billions he currently manages.

And there is an artificial bull market in stocks thanks to the FED. And the Fed Put policy has been going on since the late 90's

anarchy works

>oh no stonks went down!!
midwit take

>>49358369
If you read the paper called Buffet's Alpha, it clearly explains that Buffet is not an amazing stock picker.

He has done really well because he has tendency to pick value stocks which in general overperform, this can be replicated using a Value indexing strategy. Plus he uses some leverage, but only sensibly. Never goes full retard like Bill Hwang.

Leverage can be great if you can avoid getting wiped out.

TLDR; He is a great investor and he realized factor investing before Fama and French, but he is not some stock picking genius.

>>49358058
Why does every indexcuck think the only alternative is being a Reddit tier day trader?

Literally just invest in value

>>49358063
bad stock pickers pick crap. good stock pickers pick value. They are completely different

uhhhh Boglebros??? is it really over?

>>49358333
a measured control of risk

>>49358191
again, reddit tier day trading is not what is being discussed.

Value stocks can be bought and held just like index funds. And you can filter out all the overvalued crap that are contained in the indices

>>49358271
>>49358271
will look into them, thanks

>>49358335
simple, don't bother with "growth"

>>49358344
>hodling value stocks is that they are typically more risky and volatile than growth stock
umm...

>>49358477
The studies on professional stock pickers, (active mutual fund managers) are hardly much better.

The more degenerate you are as a trader, you will lose more money. But even most stock pickers underperform the index after fees.

You can pick Value stocks but you need a decent size portfolio to diversify the risk. Like 20+ stocks minimum. Probably 50+ to be be really well diversified. The skewness in stock returns is big and unpredictable.

>>49358473
Yeah, I've read it recently. Buffet can't be a good stock picker anymore because he has too much money.

I advocate for value investing, so no argument there.

And leverage can be done cheaply for retail investors by selling naked puts on margin, on stocks you wish to buy long term. This is similar to how Buffet invests the insurance premiums from his insurance subsidaries- it is effectively a loan you can get paid to have.

>>49358547
>The studies on professional stock pickers, (active mutual fund managers) are hardly much better.
How many of them are value investors?

We are not talking about reddit tier meme stocks

And there are quite a few value oriented etfs that have low management fees, like SCHD.

>>49354795
Tim Buckley or whatever his name is will destroy Vanguard. These funds are getting too big. VTI and VTSAX are approaching an outrageous AUM

>>49355253
In an era of cheap/zero fee investing and fractional share buying, why not buy JPM and HD and PEP yourself? Why do you need Vanguard to "keep your stocks" for you? You are giving them your votes at Pepsi and Visa. WHY? Why the fuck are we so obsessed with index investing?

>>49359301
Broad market index investing has the best, consistent, long term track record in the world of mutual funds. Most people do not want to invest any deeper than that. Index funds provide simplicity.

>>49359768
So your excuse is that people are lazy and don't want to or care to get involved with buying shares instead of ETF's, got it

>>49359992
you in particular will never beat total us stock market

>>49343102
lmao sure we are faggot

>>49357817
you nigger you will never own enough shares to have any real voting rights

>>49360139
Challenge accepted. I look forward to my quarterly dividend checks as well, cope more

>>49360149
There are a million of you index fags aren't there? Pink ID confirmed

>>49360227
>post contrarian opinion
>LOL WHY ARE SO MANY PEOPLE CALLING ME OUT
you can't be serious

>>49344756
index investing literally work long term you fucking dipshit; this entire thread is literally fucking retard teenagers too poor to understand good portfolio construction

>>49360262
Anon really wanted to show off how smart he was by pointing out that index investing causes a bubble and it's all a conspiracy because blackrock and vanguard are using your shares for voting rights. Probably started investing during the longest bull run ever

>>49360238
>>49360262
>t. 4% gains on VOO in 36 months

>>49359992
You asked why so many are obsessed with index investing and I answered.

>>49360815
>picked the best timeframe you could that supports your view
this isn't even a good b8 anymore

>>49360817
Fair enough, I'm glad we have some good discussion in this thread and more people see the light. Imagine buying VXUS 5 years ago for $52 a share and its now $56. Holy shit imagine buying VXUS instead of AAPL or TSLA

So instead of $VTI

I could buy shares of companies I like? $SBUX $GME $APPL $KHC and just never sell??

So avoid index funds because they are co-opted and controlled by sjw globalists and instead make your own blue chip picks of companies that are also obviously co-opted by sjw globalists?
Sounds like you’ve got a problem with the stock market and should be buying up metals or something

>>49343102
I thought passive investing just overtook active for the first time ever if you look AUM.

>>49343631
The problem is ESG bullshit like blackrock and the influence these index funds have over policy and company success. Even munger called them new emperors of our financial system.

>>49360817
>>49360859
actually you're just a little fuckin liar

>>49360977
Checked and correct

>>49345125
systemic wokeism

>>49358191
You can also pick stocks in your IRA and not pay taxes

>>49358191
You can't increase your gains without increasing your potential risk faster. That's what it boils down to.
>hurr it's reddit
>uhhh no just pick the right stocks
>just value invest dog it's okay
The people posting this I guarantee you have just started investing in the largest fed induced bull run in history and now think they're hot shit. If you didn't make money in the last 3-4 years you are clinically retarded. This is now the point where we see who knows how to build a portfolio and who doesn't. The dipshits expecting the S&P to suddenly go burst but their carefully picked portfolio of value stocks to do fine are absolutely positively the dumbest motherfuckers I've ever possibly seen on this board. If the S&P goes bust then people are going to be running for the fucking exit in every asset class in the world.Metals will probably recover but not before dumping like everything else (sort of like right now). But hey at least you weren't a redditor

>>49359992
yes, I am lazy, it takes me 5 minutes to buy three ETF every month
why would I want to waste hours and basically gamble when I don't know jack shit about stock valuation

>>49360815
you have to be 18 to post here newfag

While consistently beating the s&p500 might be indeed very hard, I don't think this holds true for EM or Europe. Unfortunately, there are very few active fund managers that are trying to do something different. At least that's what I've saw when looking through many fund's folios. They are afraid and most of the funds are just a copy of the indicy. A lot of these funds are actually offered by the big jews like JPM, Fidelity, Schroder, Vanguard and etc. And since they don't really do much active investing, the end result is that SPIVA shows they are underperforming passive.

Stock pickers mad they do all the fucking research, take all the risk, lose all their money trying to time or beat the market and PUMP MY PASSIVE HOLDINGS while I don't even look at my portfolio

Bogle-Sama dabbing on these hoes

after reading all these comments so far, what i learn as a financial simpleton is this:

* If you're just a regular jackoff that tries to build up financial security for the future, and you just want to invest in companies in general (in certain sectors) , go for index funds managed by these fund companies
* if you think you're able to outsmart the market, buy your ownindividual stocks as a funding company, just become your own blackrock.

Am i getting this right?

>>49362746

It does hold for Europe as well if you adjust for risk. All you have to do to beat EM is to buy EM value but if you adjust for the value risk it once again becomes very hard to beat the index.
You can always beat any index by loading up on factors but beating risk adjusted indices is always extremely difficult.

>>49362778

No, because "being your own blackrock" results in underperformance. I haven't read the entire thread yet but if this point isn't made clear then this thread is dogshit.

>>49362789
i have a weird combo of scandinavian stocks and italian utilities and i am handsomly beating both msci europe and msci europe sri on 3 year basis, which i think has been a very volatile period. i would not invest in such an index if i want exposure to europe.

>>49362836

I know scandi market very well. Tell me some of your holdings.

I run a scandi portfolio where some components are BW LPG, Arctic Paper, Mekonomen, Bilia, Midway Holding, $STG, Inwido, Africa Oil and Bergs Timber.

This portfolio is crushing everything, but it's not risk-adjusted performance, I'm just loading up on SMB and HML. If you control for this then my returns are probably in line with expectations.
This is what I mean by saying that you can always beat anything by loading up on factors but you are not beating on a risk adjusted basis if you compare with indicies such as "MSCI Europe".

Rate my actual investment strategy guaise.

>buy a lot of dividend ETF's
>DRIP
>continue to do this
>over diversified portfolio with most likely a lot of overlap
>dont care
>keep buying ETF's
>hold
>buy random stocks that I think are cool
>buy stocks in companies and industries that I think will do well in the long run, and which I somewhat understand
>just continue to hold

In like 10 years either I'll regret doing it or I wont lol

>world index goes down 12% from peak
>Meanwhile many staple individual stocks are down 50%
Index investing truely ogre fellow anons. We wen't down 20% on the SPX how will we recover.

>>49358034
Thats right, indexing is freeloading on other participants creating a proper company valution. The money others spend on researching real value is saved by doing indexing. However when the amount of indexers becomes too large you end with distorted valulations that will blow up some day.

>>49362897
why load up on factors when you can just leverage the index?

>>49349641
ishares is blackrock

>>49345125
If Index funds are distorting the market and making companies less efficient, what is the solution? Do we outlaw them and make everyone pick their own stocks? How would than even work now that every working person has exposure to the stock market through their 401k?

>>49363675
there is nothing wrong with index funds distorting the market price. if people want to take advantage of this they can do their own fundamental analysis and pick stocks

the only change that needs to happen is to force companies to allow people who hold ETFs to vote for the underlying shares. this would be very simple to set up and is one of the most important issues facing society but hardly gets discussed

>>49349421
because US companies are doing stock buy backs to increase their value rather than giving out dividends so if you sell a percentage of your portfolio you will recieve more dividends. It's actually unreal how uneducated the arguments on here are

>>49343102
Index is usually blue chip, they're fucked everyone is fucked. I'm pretty sure I will always be better off than broker suicide time. Also, never invest what you can't afford to lose rule no1

thank fuck, vanguard needs to die

>>49363872
retarded poorfags here don't actually know anything about business and finance
it's just pol with lines going up

>>49363582
Leveraging the index increases beta. Weighting multiple factors gives you multiple sources of uncorrelated expected returns, thus smoothing out your expected total return. (And depending on your factors, increases your expected total return.)

>>49363329
Buying and holding random dividend etfs for the long term is probably the least retarded of the various irrational investment strategies in this thread.

>>49346096
>salesperson
Go back and dilate

>>49349555
Most pro managers aren't trying to

>>49346861
how are they "getting capital" unless the company is selling treasury stock? they are just buying the stock from other retards that already own it.

>>49343102
Pahahaha this is an uneducated wishful thinking retard now isn’t he?

>>49363329
Suboptimal but decent, I sometimes do the same and buy some random stock or etf I kinda understand and that seems semi-reasonable to hold long-term. For me it makes investing much more exciting somehow.

Here's how you can tweak it:
>Pick a core of a couple boomer-tier ETFs (broad US market, world market, good bonds etc)
>Most of your money goes to the core
>Next time you allocate some money for investing, check if your core has gone up
>Take a share of new funds that's equal to this growth
>Spend on some random shit

>>49343102
Wow, great analysis amon! I really like how you summarized your views and provided valid well thought supporting arguments like this one
>
GREAT JOB!

>>49343102
So anyway I just loaded up on a bunch of SQQQ on Thursday, what am I in for?

>>49363675
Personally I would insist that anyone with a retirement account or pension be allowed to invest however they want, not just in what their company approves. At a higher level I'd prohibit anyone holding a stock on behalf of another (ie, pensions and etfs) from voting in board elections, period.

>>49363582
You will never get margin called on your factor tilts. More power to you if you can make leverage work though. I have considered it before but I'm not confident about handling it. Yet.

>>49363329
Dividends are an illusion. You think they are income but they are really a tax drag on total returns. Look up the Five Factor Model for the real shit.

>>49366824
If I would have enough money I would park a good chunk in blue chip dividend stocks for stability and income. Not saying not to hold growth stocks but you can live off dividends at some point.

>>49347961
>broken
its a feature not a bug.

>>49349421
The moment the US housing market even just stagnates, O will go south.
Very south...
Much of south...

>>49354795
kek
the way you wrote that reminded me of The Big Short, Mark Baum speaking in Vegas

>>49366875
you're not understanding though. There is no difference between stock growth and dividend paying stocks except for tax purposes. When a dividend is paid out the stock price drops by the dividend paid out.

so if you get paid a 2% dividend or you withdraw 2% from that stock makes zero difference financially

>>49355253
VIG yields about 1.5%
if the indices go down, so does VIG
what's the difference between VIG and SPY then?

>>49367488
>you're not understanding though. There is no difference between stock growth and dividend paying stocks except for tax purposes. When a dividend is paid out the stock price drops by the dividend paid out.
>so if you get paid a 2% dividend or you withdraw 2% from that stock makes zero difference financially
You are wrong for a couple of reasons but I am not suprised to see that people have been brainwashed into thinking that growth staocks with risky futures and insane pe ratios are the same thing as stocks with lower PE ratios that reward investors with hard cash. There is just no comparison between the two, maybe if you had mentioned stock buybacks you would be closer but that really is not the same thing either. What your post tells me is you are the kind of idiot that buys fang tesla and net flicks and is surprised they are down 40%. High PE groweth stocks that pay no dividend are and have been for a long time a con played on younger normies, they have not been a valid investment since the easry 90s and the offerings today including tesla, apple, facebook, are fucking garbage that exist because they marketed their stocks to morons with money.

>>49354795
You won't find a single dividend aristocrat fund with ESG and never will and as far as I am concerned ESG is very useful as if something has a high ESG rating I know not to buy it because it is a cancerous political cult run by morons pandering to fools and not a company, companies answer to their shareholders, full stop not some collection of retarded shifting virtue of the minute

>>49361412
A decade of crabbing sideways with a downward drift. It's coming.

>>49362836
how do you hedge for forex fluctuations?

Is it true? Or ya want scam us with ur shitcoin? My favourite NFT project is Streeth >Mints & auctions iconic Street Art NFTs >Completely safe personal Vault >Audit by CoinScope

>>49367750
maybe so but this then still confirms my point that if 70 percent of the market is crabbing sideways then the dipshits who think they are good investors are going to get railed even harder. There's no real scenario where the S&P does like ass while tons of other people are making money. OP is just a conspiracy faggot who thinks if retail pulls out than these billion dollar companies will change course (kek)

>>49367648
>What your post tells me is you are the kind of idiot that buys fang tesla and net flicks and is surprised they are down 40%.
well you're completely wrong because I literally invest in a globally diversified index fund every month and just let it do it's thing.

>>49367861
Agreed.
There are "professional investors" (by job description) right now that have never seen a monthly red candle in their career. [slight exaggeration for illustrative purposes]
It's not that hard to find "winners" (individual) in a decade+ long bull market in which the major indices multiplied several times.
In a prolonged sideways to down market, most "investors" big and small will get buttfucked mildly (or worse) but it'll be relentless and non-stop.

>>49367983
can't wait

I would buy individual stocks mimicking ETFs if I could but my choice of brokers is limited and they all have transaction fees. Therefore I need to do large transactions to not get fucked over.

I basically can't mimick an ETF. Buying the ETF only saves me literally thousands of dollars.

>>49368431
Is the money you're "saving" worth the amount of voting power you're losing when buying an ETF?

Also, are you counting the expenses and fees for holding the ETF? Some ETFs charge anywhere from 10bps to 100bps, not sure if holding ETFs even make sense in a low interest rate environment when the risk free rate is equal to that of the ETF "management fee".

>>49360262
>thinking past performance is a good prediction future results.

When I see posts like this, I hide in bonds knowing that the investment environment has gone batshit insane.

>>49360673
This isn't a conspiracy. Hope you enjoy the ESG "stakeholder" economy we're now entering, because you will own nothing and you will be happy.

You did this to yourselves, don't be blaming "da joos" for your own demise. They have every right to fuck you all in the ass.

>>49368468
I dont care about voting power in an etf that follows the broad market. And if I feel strongly about a stock I will still buy it individually.

The yearly management fee is annoying to be sure, but I would need a lot more net worth before it would make sense to buy the stocks.

Or hopefully a zero fee broker pops up sometime, that'd be the best solution.

>>49360227
>Challenge accepted.

and there it is goyim
there is absolutely no shortage of people who think they are smarter than everyone else
this is why there will never be some kind of "index takeover"
because literally every minute, a sucker is born

>>49357967
>t. just finished reading Benjamin Graham this morning so therefore I am Warren Buffet

>>49368530
I'd be very cautious if a broker begins to drop all fees. If they do that, they are making money a different way (yes, they are still making money off of you without you realizing it).

They'll just sell your orders/transactions to the big fish so they can make much more money than what they get from these marginal transaction fees.

If that does not matter to you, you probably don't have that much invested. Still they do a lot of "trend analysis" on retail data, and this will give them ideas on taking the other side of your position.

>>49357967
>if you are serious about making money, index funds are mostly useless.
agreed a job is the easiest way to make money. Index funds are for building wealth.

>>49368666
Sure thing... We'll see if you'll keep your word and not sell the bottom of a bear market.

There's a reason why smart money is willing to buy treasuries at 2% in an inflationary environment. The reward is minuscule since they're aware the market is pants-on-head retarded.

>>49363329
Same but the individual stocks I tend to wait on and sell after a year or so.

>>49367488
Except taxes, it's managed for free (they tell you the right amount to withdraw), it's automatic, and they are making a certain kind of public commitment.

Index funds have not been around for long. We will see if they stand the test of a real economic recession, and we'll see what they actually are.

You will learn that they are nothing more than a synthetic product that carries too much counterparty risk, and the only reason people own them is because of "convenience".

Yeah, sure. I guess laziness really does build wealth. This time it's different! It's not as if the whole structure of wealth is such that it takes from the many and concentrates itself to the few.

>Buys an ETF
>He didn't read through the prospectus

>>49345125
You failed to explain where this leads to the end of Vanguard. Especially why that would come about quickly.
>muh finally ending
Where?

>>49360866
Holy shit imagine having future vision. Holy shit imagine thinking past performance is indicative of future results. Holy shit imagine foreign stocks outperforming US stocks for a number of years.

>>49343102
Just when I thought stocks were getting less complicated. Lmfao I'll stick to my P2Es and spaceship fucking Cometh NFTs

>>49368468
>risk free rate is equal to that of the ETF "management fee".
the risk free rate has gone way up recently, bucko

>>49368767
>a synthetic product that carries too much counterparty risk
So then every share you own is direct registered? If you buy through a broker, every share you own is owned in street name.

>>49368666
Not fooling me satan, index funds are a money suck. I see Vanguard sent their best to this thread and try to propaganda it up

>Muh 8 companies make up 50% of VTI
>N-no you can't just buy fractional shares and make your own index
>D-dividends are bad mmkay? Stop it and buy our rip off broad market fund with 1% dividend NOW

>>49370549
just educate yourself dude

>Muh 8 companies make up 50% of VTI
But this is not globally diversified, here's what I pulled from the webpage "Month-end 10 largest holdings
(24.20% of total net assets) as of 04/30/2022 "

The image is FTSE All-world which is globally diversified.

>N-no you can't just buy fractional shares and make your own index
You can do whatever you want but why would you bother buying the few when you can just buy all the stocks and get a good return over a long period?

>D-dividends are bad mmkay? Stop it and buy our rip off broad market fund with 1% dividend NOW

Dividends are not bad, they just are no different to price growth. One is not better than the other they are literally the same.

>>49370665
forgot pic

>>49370665
VT includes markets with trash local laws, regulations, and corruption. Do you trust that President Xi will be on his best behavior this time anon? He surely won't tank your Chinese tech stocks again like last time

>globally diversified
Why do you want to own South African stocks that have gone up 4% in 10 years? Why do you want to own Japanese stocks which have been stagnating since the 80's?

>Dividends
If you want to live off passive income, you're telling someone to sell chunks of their shares vs getting a payout. The entire point of fixed income and dividends is that retirees have something coming in every month or quarter to use for living expenses, rather than selling parts of their VTI everytime they need money

>>49370756
>Why do you want to own South African stocks that have gone up 4% in 10 years? Why do you want to own Japanese stocks which have been stagnating since the 80's?

Do you genuinely think the US will outperform because it's has for the last 10 years or so? even with all the drops so far this year. If China, Vietnam or whoever goes on a 30 year bull run I'm sure you wouldnt want to miss out just because you believe America is actually good while it crumbles under your feet. Simply just don't put all your eggs in one basket and you'll never get Japan'd

>rather than selling parts of their VTI everytime they need money
you can set up an auto sell a specific amount each month. As I've said whenever a dividend is paid out the company's stock loses the value of the dividend ending up with the same net value done either way.

Having diversity is the only thing that will protect you long term

>>49369472
The brokerage isn't the issue, it's the issuer itself.

If you own a share of an ETF, your counterparty is the corporation that issues the ETF, in addition to the underlying security.

An ETF/ETN or ETP can become insolvent regardless of the underlying value. See XIV back during volmageddon in 2018.

>>49370756
>>49370961
Stop derailing the thread with geopolitics. The problem to be addressed is the ETF/ETP/ETN structure, and not the ADR structure for foreign corporation holdings. That's a completely seperate discussion rife with its own issues (is a share of BABA really a share of the underlying security given that it's issued by a Cayman Islands entity when the company itself is really Chinese?).

If you really want to own a foreign stock, you wouldn't be using the New York Stock Exchange, you would fly to Hong Kong, London or Singapore and buy it there directly, rather than dealing with the counterparty risk of getting your asset delisted by the government.

>>49368767
>nothing more than a synthetic product
>See XIV back during volmageddon in 2018.

How about we stop cherry picking degenerate inverse triple leverage gambling products and actual index ETFs with full physical replication?

>>49367648
Dividends come out of earnings. That is how the payout ratio is calculated. The company earns money, pays a dividend whether you need or want the income or not, and you owe taxes on it. The yield literally reduces the share price. That is an objective fact.

A company does not need to be growth-oriented to not pay a dividend. Part of BRK's success was in spending retained earnings on share buybacks which increased shareholder value without incurring taxes.

>>49371978
Yeah but the companies that consistently pay a dividend tend to have a stable cash flow reflecting a sound business model

>>49372147
You're on the right track so look into the quality/profitability factor. It is a robust and persistent risk factor that has resulted in outperformance of market total returns in the long term. You have the notion that not all dividend stocks are equal. This factor filters out bad dividend stocks.

>>49365836
I don't get how voting in board elections does anything.

>>49366796
I have a portfolio diversified across a bunch of asset classes and leverage it to 1.5X
It basically ends up with the same returns as 100% stocks with much less risk

>>49366796
I have a portfolio diversified across a bunch of asset classes and leverage it to 1.5X
It basically ends up with the higher returns than 100% stocks with less risk

>>49343631
Vanguard doesn't vote with index shares

>>49373628
yes they do

>>49371585
So you are going off of their promise right?

So far, ETFs have done great in the easiest bull market in history. I'd like to see how well they track the underlying in a really bad bear market.

But of course, we live in the permanent bull market era where stocks can only go up, right?

>>49373034
You select C-level executives. When Blackrock's schmuck applies for a C-level position, Blackrock and Vanguard use their exhorbitant privledge (your vote).

This is how they were able to vote out Exxon Mobil executives who were against the whole Green Energy initiative. This is one reason why gas is around $6/gallon, these corporations are no longer drilling, they'll just sit back and constrain supply as the consumer (you) get fucked.

In a way, shareholder capitalism is actually a form of democratic rule, where your ownership of a company comes with voting rights.

With ETFs, you're siding with authoritarian capitalists. This will ultimately lead to a society that somewhat resembles China today.

>>49344756
to call QQQ an index fund is technically correct... but only technically

VTI, VXUS, VWO, and VT are propernindex funds

>>49343166
I think this retard just learned what a voting share is

>>49358166
>SCHD and DIVO
SCHD is a dividend ETF while DIVO is a high income covered call ETF...why would an investor want these? Are they not tax inefficient? Why do you consider these two value oriented?

>>49358618
>naked puts on margin
Yeah just recommend unlimited losses that can happen overnight. Good idea.

>>49358034
>Eugene Fama

Wrong, friendo. I've listened to almost every public interview he's done. I realize he works for Dimensional, but he is VERY skeptical of any product that claims to beat low-cost equity index funds.

he even thinks that there might not be a value premium (!) due to investors like you who believe value investing is more profitable

>>49358543
value stocks are 100% riskier than growth stocks. 100%. that's the source of the value premium: these are shitty, dying companies, and the market has overreacted to their shittiness.

peek under the hood of your favorite value fund, and be aghast at the horrors you find

>>49367488
>except for tax purposes.
That's the whole fucking point.

>>49343102
There has been a secular trend to divest from "unsafe" companies with a poor ESG rating. This has led to large price discrepancies in companies with solid top-line revenue. Do you think we will see this trend reverse?

>>49372252
>quality/profitability factor
Can you recommend some nice ETFs that take these factors into account?