Investing General Discussion

Jysin said:

Quite the SPY / QQQ pull-in premarket.

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Friday. SPY sitting at a new high. Odds of people holding through the weekend are slim.

Blazin said:

chart speaks to technicals not fundamentals

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OU Ariakas said:

This is not a purely financial question but I'd love to know what you think about the future of global businesses. I am an avid Peter Zeihan listener and he is absolutely convinced that the global market as we know it is going away in the next 10 years. Do you, Blazin , or any other traders you know look at these kind of trends or do their effects on the stock market not matter since you are going to be in/out of stocks based on relatively short term (1-2 years) performance instead of decades long holding?

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This is a subject I have changed my mind on over the years. I spent decades investing in global/ex-US instruments chasing global growth. What I learned is that those investments always lagged my US investments over a longer time horizon. My current view is I see the global markets being dominated by American companies. I prefer investing in US companies and letting them run roughshod over the rest of the world's competition. Back to MSFT, more than half their revenue comes from non-US sources.

disclaimer - I own zero non-US companies (including ADRs) unless one or two is tucked into an ETF. BABA may be an exception I grab.

Blazin said:

govt holding back this inflation number is really odd. Looks like PPI coming in a lot hotter than anticipated.

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Something is shady somewhere.

How much of it is gas price spike?

Nm..

Jysin said:

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Is this a reference to the year or the tech bubble that burst, or both and you’ve mastered the pun?

Long term investing. Boomer stocks. We spend a lot of posts discussing meme stocks and day/swing trading but at the end of the day over the long time horizon its all about buy and hold of quality stocks in my opinion. The desire is the grab the stock that is abut to catch fire or find the next FB or TSLA before it blows up and we all feel it. And there is nothing wrong with a small-ish portion of a portfolio being assigned to this endeavor. At the end of the day, wealth is built combining quality and time.

I am not going to point out who, but last year a poster asked why would anyone invest in DOW Boomer stocks like UNH or WMT. In my mind an investor cant go all in on growth. There needs to be a balance. Not all Boomer stocks have zero growth. Some have reinvented themselves and evolved their business model. For example LMT is up almost 80% over 5 years. Add in dividends and its close to 100%. That is almost double the historical return of the S&P 500. This from a company that earns $25 a share a year in earnings. UNH is up over 200% in the last 5 years. That is before dividends are added in. They earn almost $20 a share in earnings.

I am not pumping LMT specifically, but highlighting that I believe one of the hardest things to master is the long-term investing horizon. Buy high quality, hold them and let them do their thing. Especially for those companies outside the Tech sector. Cumulative dividends in the 2-4% reinvested really add up over the decades when combined with a 10 - 20% annual stock price appreciation. Chase the unicorns with SPACs and meme stocks (I do), but let the lion's share of your portfolio just sit and build. Look for times when the market gives you an opportunity to add to those positions at good prices.



This has been a public service announcement from the over 50 crowd. You may now return to your penny stocks

karma said:

So, question along these lines (and this might have been addressed earlier and I don't remember-sorry in advance if it was) do those of you who manage your own long terms that tend to favor ETFs use DRIP? or do you put the dividend income to use bolstering other aspects of your portfolio balance?

Sanrith or others who long term particular companies that pay divs, do you use DRIP on any of the individual companies you hold?

If the answer is yes, is it one of those situations where it depends on the stock, etf etc? or is it just the standard?

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I reinvest all dividends in all of my stocks/ETFs

Hateyou said:

There an auto setting in fidelity for that? I want to do that but haven’t set it up if there is.

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Yeah its in account features/brokerage and trading. Of note, you need to go back and update it each time you buy a different stock. Its annoying and I have forgotten once or twice and wondered why i got a dividend paid out to my cash account.