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tony

This Index Card Says It ALL

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In part to be a contrarian and in part because of my own psychology...during times of significant change, upwards or downwards, I simply can't turn off the metaphorical TV and I can't stop looking at my spreadsheet, which updates in real time.

I just enjoy the show too much. The chaos is interesting. I'm amused listening to somebody explain why the market is down 2% at 1PM only to see the market up 2% by 3:30 PM. I love listening to how it affects people and what they plan to do (or not do) about it. It is a window into human psychology and the whole thing is just too fascinating to look away.

...I do however agree with the sentiment of the card. We should all measure returns in decades.

 

Decade.png

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What awful luck for retirees in 2000 who maybe just barely had “enough” to retire. Two huge crashes within 8 years of each other. Short of the Great Depression has any similar window been comparable/worse? Maybe the 70s?

That is actually a real concern I have in evaluating when enough is enough while still balancing the fact that my time on this earth is finite. 

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Spoken like a true broker and salesman, but data retrospection has no value except to show how a diversified and balanced portfolio performs over past market crashes. Past data NEVER give anything meaningful on predicting future returns.

As you know I will never respond to natural market fluctuations. I rebalance because my portfolio is out of whack, NEVER in response to the noise that is everywhere! 

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7 hours ago, Imua808 said:

I'm just kind of bummed my AXA money didn't transfer till just before this drop.  boooo....

 

Can you explain a little more? 

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Yup The trick, then, is to avoid making portfolio decisions based on short-term swings and movements. Data shows that those who trade excessively  or at the wrong time tend to show much worse performance than the buy-and-hold investors who mostly sit tight and reap the benefit of compound interest. My brother call me yesterday disturbed that his 401k had tumbled. I told him  if he was scared from what happened he needed do nothing now but eventually move into more bonds. I doubt he will listen to me.He didn't last time we talked about this. His buddies at work are all high flyers and have their saved assets in things like gold, silver, and individual company stocks. Listening to others can be detrimental to your financial health but thats how many invest. Following the crowd can be costly.

 

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12 hours ago, sschullo said:

Spoken like a true broker and salesman, but data retrospection has no value except to show how a diversified and balanced portfolio performs over past market crashes. Past data NEVER give anything meaningful on predicting future returns.

As you know I will never respond to natural market fluctuations. I rebalance because my portfolio is out of whack, NEVER in response to the noise that is everywhere! 

"NEVER give anything meaningful on predicting future returns."     I will say is again, future returns are a simple math equation that anyone can calculate. Only issue..there is a missing variable which is ending valuation levels 10 years out (ending P/E ratio) . Bogle calculates it with the historic average valuation (15X)

If you don't believe me ....then believe John Bogle because that is exactly what he uses and has used for decades.

 I don't sell I educate.

Bogle: My Return Expectations for Stocks and Bonds

"I have a reasonable expectations kind of formula that I’ve been using for 25 years and it’s worked the whole 25 years almost perfectly". -Bogle

http://www.morningstar.co.uk/uk/news/162164/bogle-my-return-expectations-for-stocks-and-bonds.aspx

http://awealthofcommonsense.com/2016/09/the-john-bogle-expected-return-formula/

 

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4 minutes ago, Ken F said:

future returns are a simple math equation that anyone can calculate

Oh boy. You're dangerous to people's financial health.

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17 minutes ago, EdLaFave said:

Oh boy. You're dangerous to people's financial health.

dangerous?  You don't have to believe Bogle or Buffet. You can review 100 year of historic data and form your own conclusion. Are returns random? (random hypothesis theory)

Why do some 10-15 year periods have zero rates of returns (2000-2013) and other have 16% rates of returns? I guess you think they are random right?

https://www.crestmontresearch.com/ur-highlights/

https://www.crestmontresearch.com/docs/Stock-Matrix-Index6-YE-11x17.pdf

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To anybody reading this thread, please study Ken F from the safety of your own home. He is a great example of what you'll face in real life when 'advisers' try to take advantage of you. Inoculate yourself now before the 'adviser' can turn up the pressure on you. There are no shortcuts in investing and if you decide not to buy into whatever folks like Ken are selling, they'll try to make you feel like a fool who rejects simple, indisputable math. Don't fall for it.

Ken F used to go by the name KFord. Ken had a lot to say in a thread back on May 11th 2017. After listening for quite a bit, this was my conclusion with regards to Ken...a conclusion he had no meaningful argument against (because there is none):

Quote
1. You're playing to people's fear...stock market crashes are scary and not having enough money for retirement is terrifying.
 
2, You're playing to people's greed...who wouldn't want to get more than the market returns?
 
3. You speak the "language" with confidence...the uninitiated will assume you know better than they do.
 
4. You reference authorities in the industry (Buffett and Bogle) to borrow their credibility...yet reach conclusions in direct conflict with said authorities.
 
5. You never reveal what you'd actually do with all of your knowledge...so it is impossible to definitively assess you.
 
These techniques are regularly used to manipulate and prey on people in all arenas of society/industry. I find it to be manipulative, deceitful, and I don't like it one bit.
 

 

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39 minutes ago, EdLaFave said:

To anybody reading this thread, please study Ken F from the safety of your own home. He is a great example of what you'll face in real life when 'advisers' try to take advantage of you. Inoculate yourself now before the 'adviser' can turn up the pressure on you. There are no shortcuts in investing and if you decide not to buy into whatever folks like Ken are selling, they'll try to make you feel like a fool who rejects simple, indisputable math. Don't fall for it.

Ken F used to go by the name KFord. Ken had a lot to say in a thread back on May 11th 2017. After listening for quite a bit, this was my conclusion with regards to Ken...a conclusion he had no meaningful argument against (because there is none):

 

 

Ed

Why are you attacking me personally? I am not selling anything. I shared knowledge that is counter to your belief. These are facts that you can handle or debate logically.  Why don't you do some research and tell me that Bogle's math formula is wrong & as you call it dangerous?

FYI: If it makes you happy this is my last post ever on this board.

Have a great life

KF

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I'd like to make a few things very clear.

#1, I am not attacking Ken personally. I am attacking the methods Ken and other 'advisers' like him use in order to take advantage of hard working people. In the thread I originally referenced I made that completely clear when I said:

On 5/11/2017 at 1:29 PM, EdLaFave said:
KFord, what I'm about to say is not meant as a personal attack on you but is meant as a general critique of the techniques you've used in this thread

#2, Ken is selling something, whether to members of this board or to other people, he is selling something. In the thread I originally referenced, Ken was being pressed to reveal the actionable steps that his 'knowledge', 'facts', and 'simple math equation' dictates we take and he had this to say:

On 5/11/2017 at 11:06 AM, Ken F said:

I am not and do not recommend specific investments to non clients.

#3, Buffet and Bogle are very clear when they tell investors to pick and maintain an asset allocation, buy total market index funds, and invest with each pay check whether the market is going up or down. Don't do something, just stand there! Our friend Ken has managed to take Buffet and Bogle quotes out of context, apply spin, and reach an entirely different conclusion.

#4, I am in no way the arbiter of this board and I don't care whether Ken posts or not.

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