I appreciate the advice. While I’ve only been investing this way for about 11-12 years, back testing has been statistically valid to the early 2000s (limited by the availability of index funds for comparison). You’re right though, who knows if it’ll work in 30 years. There’s some evidence that it may based on trends in institutional investing. That enough uncertainty to avoid putting all my eggs in that basket.
Re:How People Get Rich Now
by WalterBright on Monday April 12, 2021 @09:43PM
(#26787298)
> early 2000s
I got hammered really hard by the 2000 crash. Down something like 75%. I thought I was smart by not investing in bubble stocks. But the secondary die-off caught me. It was a bitter pill.
It’s certainly possible something similar can happen to me. Part of this is mitigated, I think, by the fact that the overall volatility is reduced. That’s one of the pitfalls I’ve seen in contrast to the growth plays not based on intrinsic value. I think it’s the main reason the risk-adjusted returns are better but time will tell. Black swan events always seem obvious only in hindsight.
But I do suggest caution. A strategy that works for 3 years may not play out well over 10, 20, 30 years.
Yeah, I know I wrote "everybody knows". I meant "it is generally known".