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31m. Just started investing last week and got some positions. I’ll probably add a couple more etf or stocks in this current down turn and add to the ones I have but Am I diverse enough as it is? I make roughly 2k/month working,( about half of that to expenses)my tax bracket is low rn so just trying to build capital to make it worth putting in an IRA. Thanks in advance don’t pull your punches. Not planning to do options either.
You have way too high a percent of your portfolio in individual stocks. Focus on low fee etfs, ideally ones that track whole or at least broad market segments.
Would you recommend any etf? Is JEPQ not quality?
VWCE and chill is what I do.
Not bad ,pretty tech heavy or solely tech anyway. Not a bad thing but I like to spread out a little in case something goes south in one sector.
Eh? 27% is tech heavy for VWCE but jepq says they are 41% into tech.
From the data sheets I am seeing VWCE is more spread out as it follows international FTSE index while JEPQ only tracks US stocks.
0.35% is a little high for an expense ratio, especially for a product that has basically followed the S&P500 for the last 10 years. I'm no expert, but there are lower fee etfs from Vanguard that perform basically the same.
Are you planning on day trading? Do you have access to information that other day traders do not? If not, I would put everything into a mutual fund and forget about it. Until you have more money, then I would put that money into the same mutual fund and forget about it.
Or, try buying individual stocks for a year, and see if your layman's picks outperformed a normal mutual fund. If you did not beat the mutual fund, then you have discovered why you should put everything in a mutual fund and forget about it.
Yeah I definitely see what you’re saying but I would like to actively manage my own money. I’ll have a split portfolio so I’ll definitely have a decent amount in a mutual fund of sorts. Are these basically the Schwab money markets I see or do you mean like real mutual funds? They typically have minimum investments im no where near being able to afford.
You said you have $1000/mo in disposable income. The fund minimum on VFIAX is $3000. Do it. ROTH IRA style(after taxes, do not claim a deduction for this in your return) up to the max of $6500/yr. Since you're in a low tax bracket currently and presumably will have higher income and higher taxes later in life you want to pay taxes on this money now, not when you withdraw it. Any excess funds can go towards individual stock picks or in the equivalent ETF VOO (which you already seem familiar with).
There are tons of mutual funds, worth doing research there. I like Vanguard Growth index fund myself.
I think the idea that a clever young man can beat the market by making clever individual stock trades is a myth perpetuated by wall street to keep folks throwing money into the market. Casino owners want people to think that they can hit it big if they try their luck.
If your car needed a new engine, would you do this yourself or hire a professional? If your house had a gas leak, would you fix it yourself or hire a professional? Why then would you manage your own investments if you're not a financial advisor?
If you're interested in it as a hobby, put 90% of your money in a mutual fund and play slot machines with other 10%. But don't presume that playing slot machines with 100% of your savings is a sound investment strategy.
Trading individual stocks is free. Mutual funds have a minimum buy in. Your local high school theater is free to attend. Hamilton tickets are $500 minimum. This is because one of these things is worth attending.
If you have limited funds and are just picking up a stock here or there, my utterly unqualified advice (if you like extremely high risk) is to buy the things you think are genuine quality, especially if it pays a dividend. Some classics (may or may not have dividends) are things like Costco, Apple, Home Depot. Also, is there anything in-particular you know or follow that might be available for trading?
For example I follow some dorky ass tech-youtubers, and I watch the products stuff pretty religiously. I was able to catch AMD when it around $20 (like 2017), because I was following the industry and the news, and when the threadripper/ Zen architecture came out and kind-of shocked the community. It was like, some "wow" level performance, and I picked up some shares. I didn't do any crazy technical analysis. I just thought "Wow I want one of those crazy threadrippers. I'm a people. I bet other peoples do too!". That ended up being a five bagger. When ARM went live earlier this year, I bought that as well. Its had some ups and downs since Intel kind-of shit in the microprocessor pool, but its still been a good ROI (it was a 4 bagger for a minute, now its down to a 2 bagger).
The real challenge on trading or buying and holding on limited funds is that, well, good shit is more expensive. Thats kind-of how the market works. Quality stocks that go up and to the right are expensive.
So some dont' s that I learned (and I started with just 1's and 2's of stocks; literally was putting in $20 a week).
Don't buy cheap shit just because you get "lots" of it. Its cheap for a reason. Try to think in dollars not shares.
Stop touching things. Or at least, understand, for yourself, why you are doing this. It can really turn into an addiction and you absolutely will lose all your money just fucking around moving shit. The apps are engineered to turn your money, into their money. The person giving you market isn't your friend, they are your opponent. Company's like Schwabb, Robinhood, fucking all of them are literally selling the information in your account to high frequency traders. Payment for order flow is why they are letting you trade for free. Keep that in mind. The app wants to turn your money into their money.
And if you are just doing this for fun, then have fun and lose money. Its a blast to ride a 20x option. I've watched 2k go to 50k, then to 10k, then 0 in like, minutes because who the fuck know why. But its a fucking emotional roller coaster. Know for yourself why you are doing this thing.
Three, have a plan. This plan needs to be like a story. It should have a beginning, a middle, and an end. Like, get a rubber duck and tell it a story of why it makes sense to do what you are thinking of doing (be-it buying or selling a position). Don't lie to yourself about why you want to do some thing. Why are you entering a position? What are you going to wait for while you are holding that position? When will you leave that position? Whats the plan?
Fourth, have a schedule (kind of feeds into point #2). Don't check this thing every fucking day or every hour. Have a day of the week where you are going to check in on things (or a time of day). I say this because intra versus inter day trading can really fuck with your perception. When I was day trading, I would get up early to be ready for opening bell and only trade the first hour. This was incredibly emotionally stressful and I hated it. I ended up moving to a time zone where I couldn't accommodate that, so I started only trading in the last hour. I buy completely different stocks with a totally different strategy now.
If you are looking for something extremely passive, you might just buy SPY until you feel like you've really got enough to do something interesting to you.
Thanks for the response. My main goal is to get to a point of comfortable passive income. I do have about $1,000/month of disposable cuz my living expenses are cheap rn. My income stocks rn are the JEPQ and GLPI. Did some research on Concentra and I believe that stock will grow well in the health industry. Halliburton got cyber fucked and price dropped which is why I picked them up. We’re gonna be in war soon and they do great when there’s conflict lol also energy and oil. Looking into OXY as well. Good dividends and rated really well. All of these will be long term holds. A good portion of my investment will just be going to the money market funds to get safe passive compounding interest. I dont follow anyone but i read alot of articles browse Reddit (banned af so can’t participate). I’m not interested in meme stocks or options trading. Not risk adverse but I don’t wanna take gambles. I know I’m missing an index fund so that’s my next one. Seen all the hype on VOO SPY and the like but the buy in at 500 each rn isn’t feasible and the individuals I’ve chosen speak to consistent yield and long term success. Except for JEPQ but they been solid as long as they’ve been around but maybe what I’ve read is less informed
I mean it seems like you have some ideas. So thats a start.
I'm just gonna put it out there, that I don't invest in things I don't know about. So I have no opinions about any of the plays you just suggested.
I have a very different strategy than probably everyone else here. I only hold a few positions, maybe as few as 1-2, plus cash, at times. Its definitely not for everyone and its definitely not the "game theory" most efficient.
There are many philosophies on trading, so you'll get lots of opinions.
First, you need to state your goals. Personally I'm a long term investor and I would say you are not diverse enough. If you only have 5 positions, I also would not invest in individual stocks, which is mostly what I invest in. But I have probably 100 stocks, which gives me my diversity.
ETFs charge fees, so I'm not a huge fan. I like to avoid fees whenever possible. I also like, for long term, to invest in solid companies and solid industries. For instance, in a crisis people still need energy, toilet paper, food, water, medicine. So I like these.
For some stocks to invest in, look at proven investors. Warren Buffett's portfolio is available online. Look for a stock you like and track it. If it drops, buy it. If it drops again, buy more. If you're afraid to buy more, then it probably wasn't a good choice to begin with.
For short term investing, I usually use small amounts of money because of the risk involved. And don't forget, capital gains is higher on short term investments.
That's my opinion. It has served me pretty well. Good, luck.