Venting
The thread was “Venting”, the board was Mechanical Investing, and the reply that earned the front page is ced1106's.
“I checked my results, and I did worse than if I had just bought and index fund”
IMO, Investors focuses too much on the results. As implied in this thread, volatility and risk are also important. Yet that's almost never reported or discussed.
Can you quantify your risk? Or at least compare it against an index fund? The S&P Index fund is a benchmark, but it's loaded with tech, which obviously concentrates your holdings and increases risk. Current Sharpe ratio is about 1.00.
Nvidia——7.8% Apple——6.9% Microsoft——5.6% Amazon——4.0% Alphabet (Class A)——3.1% Alphabet (Class C)——2.9% Meta Platforms——2.6% Broadcom——2.4% Tesla——2.1% Micron Technology——1.6% Some stocks that have the same sharpe ratio as the S&P, but lower returns (thanks, AI :P
Johnson & Johnson (JNJ) Consolidated Edison (ED) / Duke Energy (DUK) Procter & Gamble (PG) / Colgate-Palmolive (CL) Berkshire Hathaway (BRK.B) (During Tech Rallies) I doubt anyone's going to tell you these aren't good stocks a retiree should own. They obviously diversify from a tech-laden portfolio. And a portfolio that has cash and bonds to reduce risk will not perform as well in the long term as the S&P.
That said, how much risk you can take can have a heavy subjective component ("never buy a stock that doesn't let you sleep at night"). Retirees are affected by short-term stock volatility than long-term investors. And we often don't even know how much risk we can take, since it can be hard to quantify.
Myself, I think my returns are HALF the S&P. I have too much cash, because I'm not comfortable buying large positions of stock. However, as a retiree with two elderly parents who also need cash, as well as enough money anyway to retire on (I don't like traveling), that's more acceptable than wage-earning years, I guess. I'm only comfortable owning stocks I'm familiar with, so LTBH into stocks suggested by screens that have familiar stocks, rather than doing any "real" research. :P I'm also lazy and prefer to watch cat videos, so only spend weekends when the market is tanking (CNN Fear and Greed Index at Extreme Fear, like now) catching up with MI and other screens (I select dividend stocks with some free stock screen site that has parameters recommended for dividend screens, such as cash payout ratio) and place buy limits (based on Volume Profiles).
I did read that, with the market, more research doesn't mean better returns. When I found out that Monster Energy drink, which I bought thanks to MI in the 1980's, performed better than Apple, I gave up. :P
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