Stricktly +EV for a Young Investor

[gull]

Construct a diversified portfolio of index funds. Use tax-advantaged accounts if possible.

[maxtower]

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Please don't listen to the posters in this thread who are telling you index funds are always better than actively managed funds, because there couldn't be anything further from the truth. Take some time to research funds out their with great track records, relatively low costs, and have a min. fee that meets your requirements.

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This has been discussed many times on this forum, and the consensus is that you are wrong. Sure there will be a fund that outperforms the index, but what are the chances that OP picks it? What are the chances it continues to outperform over many years?

[Fishhead24]

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If he has 25,000 now and is making 60,000+ a year currently.........he should be completely retired in 5-10 years if he has half a brain.

Learn how to gamble and find investments against the norm.

-FH-

[/ QUOTE ]Thats me, please show me the way.

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Don't get married, live in a hovel. Ship it.

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Exactly what I may be doing come next June........and I'm approaching 50 years old.

1. DONT get married

2. Learn how to gamble(poker, video poker, sportsbetting).

3. Live frugally

4. Do not buy more than one new car in your lifetime(everybody should buy one just for the helluva it), but used is the way to go.

5. Clip coupons

6. Tip more than the norm but don't overdue it.

7. Diversify your investments.....real estate, stocks, savings, farmland, precious metals, collectibles.

[PRE]

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Please don't listen to the posters in this thread who are telling you index funds are always better than actively managed funds, because there couldn't be anything further from the truth. Take some time to research funds out their with great track records, relatively low costs, and have a min. fee that meets your requirements.

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index funds in conjunction with a well constructed portfolio has always done better and will in all likelihood will always do better than actively managed funds.

Barron

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Thank you for telling me what I already know.

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Please don't listen to the posters in this thread who are telling you index funds are always better than actively managed funds, because there couldn't be anything further from the truth. Take some time to research funds out their with great track records, relatively low costs, and have a min. fee that meets your requirements.

[/ QUOTE ]

This has been discussed many times on this forum, and the consensus is that you are wrong. Sure there will be a fund that outperforms the index, but what are the chances that OP picks it? What are the chances it continues to outperform over many years?

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Well I guess that depends on how much work and research he puts into finding attractive funds.

[adios]

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....To profitably capture these premiums requires very low commissions and cost of carrry as well as expert executions. It also requires a much higher level of understanding of the markets and their instruments than is exhibited by the OP.

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Probably won't get any of these at your run of the mill discount broker but could be wrong about that. Very interesting post.

[T50_Omaha8]

It's always funny to read people discuss complicated investment concepts on here and then stumble through the most remedial discussions imaginable on basic investing.

The higher the "EV" or expected return of an investment, the higher the degree of risk. If you have some extraordinary ability to evaluate expected return and risk more accurately than the market, good for you. You're one of extremely few.

For all of us mortals, investing in an index--a portfolio with a huge array of stocks of a relatively high risk level-- is about the best we can do; we maximize return while minimizing risk for that level of return. Mutual funds are a lot like indexes--they're still only buying the same stocks with publicly available information--and they have a rake. It turns out the casual investor very rarely overcomes this rake. Therefore, indexes appear to be the better buy.

Any of your own research you sit and do from your computer will be essentially worthless. You won't gain anything, and you won't lose anything. Your expected return will be exactly the same.

And none of us has the ability to take advantage of derivative premium arbitrage. The cost for an ordinary person to make such investments exceeds whatever (negligible) return bonus you could ever get many times over.

[Chrisman886]

75% of the people in this thread have no idea what they are talking about.

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75% of the people in this thread have no idea what they are talking about.

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Informative, thanks

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It's always funny to read people discuss complicated investment concepts on here and then stumble through the most remedial discussions imaginable on basic investing.

The higher the "EV" or expected return of an investment, the higher the degree of risk. If you have some extraordinary ability to evaluate expected return and risk more accurately than the market, good for you. You're one of extremely few.

For all of us mortals, investing in an index--a portfolio with a huge array of stocks of a relatively high risk level-- is about the best we can do; we maximize return while minimizing risk for that level of return. Mutual funds are a lot like indexes--they're still only buying the same stocks with publicly available information--and they have a rake. It turns out the casual investor very rarely overcomes this rake. Therefore, indexes appear to be the better buy.

Any of your own research you sit and do from your computer will be essentially worthless. You won't gain anything, and you won't lose anything. Your expected return will be exactly the same.

And none of us has the ability to take advantage of derivative premium arbitrage. The cost for an ordinary person to make such investments exceeds whatever (negligible) return bonus you could ever get many times over.

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Does Bill Miller have a secret machine that the rest of us mortals aren't exposed to?