Dow jones at record high, but many stocks are not?

[supton]

Not bragging….

But I’ve been over $1M for quite some time with tech ETFs really driving things higher and higher.


At one time my entire Roth IRA was Amazon stock.

Nice!

I was reviewing my holdings yesterday and noticed that 3 of my 5 funds basically hold the same stuff. Amazon, Google, Nvidia, Apple, few others. Like 8 out of the top 10 were all the same. Go figure. Makes me a bit worried, just what would happen in a dip (or worse)--but it's more than a decade before I can touch my retirement accounts. Might as well leave it alone and leave it to their respective managers to reallocate as necessary.

Today I was looking to see what might be more of a full market fund but even those seem heavy on tech.

 

[ecotourist]

Today I was looking to see what might be more of a full market fund but even those seem heavy on tech.

Berkshire Hathaway is a bit like a US mutual fund, with one of the best "fund managers" in the world, and a 0% MER. It doesn't have a lot of tech.

I held back on investing in Berkshire for years primarily because Warren and Charlie were getting so old. But I eventually gave in and bought some for my wife. Her small Berkshire Investment is up 591%. We should have invested more!

Disclaimer - This is not to be considered investment advice.

 

[SC Maintenance]

Nice!

I was reviewing my holdings yesterday and noticed that 3 of my 5 funds basically hold the same stuff. Amazon, Google, Nvidia, Apple, few others. Like 8 out of the top 10 were all the same. Go figure. Makes me a bit worried, just what would happen in a dip (or worse)--but it's more than a decade before I can touch my retirement accounts. Might as well leave it alone and leave it to their respective managers to reallocate as necessary.

Today I was looking to see what might be more of a full market fund but even those seem heavy on tech.

Correct. The top 7 S&P 500 stocks make up 30% of its value, and there all tech stocks.

Most funds - even the managed ones - tend to track an index. Even "actively" managed funds tend to track an index, with the fund managers often even over-weighting the top stocks, because there goal is to beat the S&P 500, so they only way they can is to be over-weight the best performing assets in said index.

 

[Dave Hess]

I wonder if you've held it since 1998? You might be the richest guy on here Personally I think with some patience and a good amount of anxiety medicine, putting all your eggs in one basket pays off eventually. Ever dog has its day, or should I say stock?

Imagine if I bought:
Apple, Tesla, Nvidia, Facebook, Microsoft, Google, etc… when they were $5 share… ?


At one time I had a big chunk of Tesla stock, made money and got out.
Put that money in a basic tech ETF, my heart could not withstand the craziness and Elon smoking weed, saying silly things, arguing with various people, etc.

When will this tech boom run out of steam similar to Dot Com bubble…. ?

 

[Bryanccfshr]

Not advice, just what I do. set my allocation to maximize Sharpe and Sortino ratios. Have 5 mutual funds I focus on in my retirement accounts. Not an expert not even close, but I use data from the long haul for the long haul but still feel I can take another downturn. The past 10 years growth and technology have paid off and value and dividend funds have either played as stabilizers or laggards. I use one dividend growth fund and the S&P to take my profits to from high risk funds on rebalancing.
I maximize my rot IRA and 401k annually. I think the key is to invest and keep putting in.

 

[gfh77665]

I all but ignore the Dow.

I watch the SP500, its a much better index to reflect on the broad market.

Total market indexes are the best, but they are rarely if ever displayed, so tracking the SP500 is the easiest and best to do.

 

[eljefino]

Annoyed at what I think is a tech bubble, I reallocated some from VOO (S&P 500) to VTI (total index-- everything) and VIS (industrials-- what I figured was stuff not FAANG.) And given the insane gains of this year, I reallocated 25% to "safe" bonds & CDs. Two questions the investor should ask themselves-- "how could this get better" and "what's the next black swan?"

 

[ecotourist]

Imagine if I bought:
Apple, Tesla, Nvidia, Facebook, Microsoft, Google, etc… when they were $5 share… ?

The problem is that those are the stocks that went to the moon.

But people also bought XYZ.com, RST.com, PQR.com, etc which all went bust. That investor isn't talking about it. In fact he (and it's usually a he) has probably sworn off owning stocks forever and is now investing only in a high interest bank account. And that's a different kind of folly.

One of our friends had retired and was invested heavily in the dot.com boom. He lost so much money in the dot.com bust he had to go back to work - which was not nice for a self employed guy who had sold his business. He was pretty grumpy in fact.

 

[Sam_Julier]

@The motor guy

Please listen carefully to @Astro14. His advice is sound.

 

[Astro14]

I wonder if you've held it since 1998? You might be the richest guy on here Personally I think with some patience and a good amount of anxiety medicine, putting all your eggs in one basket pays off eventually. Ever dog has its day, or should I say stock?

Wildly untrue - what if you chose the most highly recommended stock of the late 90s? The one that made Forbes list of best stocks to own six years in a row.

That company was Enron.

A dog that had its day, right until they failed, taking the entire life savings of those who had invested in them to zero. Wiped those investors out, completely.

Only a fool puts all of their eggs in one basket. What you are doing is not investing, it is gambling. You’re getting the same dopamine hit, and have the same odds of beating the house.

This is not a laughing matter - you are making huge mistakes.

I am serious.

So serious that I offer this: PM me your address and I will send you the first book off the reading list I recommended.

 

[JeffKeryk]

It's worked for so far for a long time. I've doubled my portfolio in the last 5 years doing this. It worked until now when their aren't anymore good bargains. It's just the first time I've ever had it where the market went way up and my portfolio never really moved. It didn't go down, it just hasn't gone up much the last year or so. Nature of the beast

Anyone in the market over the past 5 years looks good.
What @Astro14 is telling you is, timing the market might work in the short term but history tells us, loud and clear, that time in the market wins.
Here's the S&P over the past 5 years. Nearly doubled. Snap a Linear Regression line and you see a pretty nice slope.

Congrats on your gains, but those results are nothing special given the market. The S&P out performs like 85% of the stocks in the market, 80% of other stock funds.
It's a huge no-brainer.

Sure there will always be Teslas and NVIDIA, but those are roller coasters.
Good luck in your investing. Perhaps the smartest advice I ever got was, "You should make your money work for you regardless of market conditions." That's a fancy way of saying diversify and take a long term approach to investing.

 

[Alfonso Base]

I guess Warren knows something to sell Apple stocks now.

 

[The motor guy]

I guess Warren knows something to sell Apple stocks now.

I think he screwed the pooch on BAC he keeps selling it and it keeps going up

 

[Bryanccfshr]

He probably made a lot of gains and this is a good time trim some off the gains and invest elsewhere. Just good profit taking/rebalancing of an investment that has grown well, which is a good risk abatement strategy.

 

[The motor guy]

He probably made a lot of gains and this is a good time trim some off the gains and invest elsewhere. Just good profit taking/rebalancing of an investment that has grown well, which is a good risk abatement strategy.

Well, no telling how long he's held them. He's been in the market since like 1960 I think, so he's probably waaay up on everything. I don't really think a billionaire has to worry much about risk though with the amount of money he has

 

[Dave Hess]

I opened Vanguard Roth IRAs for our 4 kids when they turned 18, I funded the first year Max Contribution to get the snowball rolling and I split it up between:

VOO - S&P 500
VTI - Total stock market
VGT - Information Technology
VUG - Large Cap growth

Now they have auto contributions set up and their Roth IRAs have grown nicely, no complex trading….. just boring high quality ETFs.

 

[The motor guy]

I opened Vanguard Roth IRAs for our 4 kids when they turned 18, I funded the first year Max Contribution to get the snowball rolling and I split it up between:

VOO - S&P 500
VTI - Total stock market
VGT - Information Technology
VUG - Large Cap growth

Now they have auto contributions set up and their Roth IRAs have grown nicely, no complex trading….. just boring high quality ETFs.

I tried buying both VO and VOO and I got some weird message about it being risky or something, so I cancelled the order. I wasn't sure what it meant.

 

[Astro14]

I think he screwed the pooch on BAC he keeps selling it and it keeps going up

Tell you what - after you make your first billion, then, perhaps, you can criticize him without sounding silly.

Well, no telling how long he's held them. He's been in the market since like 1960 I think, so he's probably waaay up on everything. I don't really think a billionaire has to worry much about risk though with the amount of money he has

When the press talks about Buffett buying and selling, he is doing so on behalf of Berkshire Hathaway, which is now a trillion dollar company. He is acting on behalf of the shareholders that invest with B-H.

So, of course he worries about risk, which is part of why he eschews tech stocks.

Do you understand what is being discussed here?

 

[Bryanccfshr]

I tried buying both VO and VOO and I got some weird message about it being risky or something, so I cancelled the order. I wasn't sure what it meant.

Did you know that Buffet wants his wife who does not know much about investing to invest almost 90% in the S&P 500? https://moneywise.com/investing/warren-buffett-wifes-inheritance-investment.

You can beat most investors by following the advice he just gave for his wife’s inheritance.

 

[k1xv]

Today almost every stock I own went down, but my Tesla and PEG went up so I had a net positive day.

I bought the Tesla last Friday 11/15 and it closed today 11/19 up 7.5% in 3 trading days.