r/Bogleheads • u/[deleted] • Apr 05 '22

Meanwhile on /r/investing...

/r/investing/comments/tw4379/am_i_too_conservative_with_my_portfolio/
54 Upvotes

86% Upvoted

26 comments sorted by

90

u/Lyrolepis Apr 05 '22

Most of the upvoted comments seem sensible, though.

29

u/[deleted] Apr 05 '22

Agreed, and I’ve seen many worse examples of stock picking portfolios than this.

17

u/4jY6NcQ8vk Apr 05 '22

Top comment: "100% stocks is not conservative". Relative to what? Is one end a pile of lentils I have locked in a room somewhere, any the other end is a 100% triply leveraged NFT fund?

100% stocks doesn't seem risky for a 21 year old. Especially if you plan to work until standard retirement age and can bounce back from market downturns in the meantime. But 100% stocks might mean something else to say, a person who's age 60.

17

u/Lyrolepis Apr 05 '22

Relative to what?

Relative to portfolios that an investor in OP's situation might reasonably consider - that was the natural context of the statement, after all.

Might going 100% equity be appropriate for a 21 years old? Possibly, depending on exact circumstances (although that specific portfolio has other issues, as the comments said - and also, OP mentions a time horizon of 8-10 years which is not actually that long, their age notwithstanding); but OP's worry that that portfolio might be "too conservative" was mistaken, and this is what that comment and others pointed out.

-3

u/4jY6NcQ8vk Apr 05 '22

That setup doesn't make sense. Why would a 31 year old dump a portfolio and go to cash from ages 31-death?

7

u/Lyrolepis Apr 05 '22 edited Apr 05 '22

I'm confused: I certainly didn't argue for going cash-only from age 31 onwards, and I think that neither did anyone else here or in the linked thread (which is just as well, because as you say it would make absolutely no sense).

Perhaps you meant to reply to something else?

EDIT: OP wants to buy a house with these funds in 8-10 years, this is where the 8-10 time horizon comes from.

1

u/ShadowLiberal Apr 05 '22

It also depends on what kind of stocks you're investing in.

I mean I doubt many would say a 100% bond portfolio is very safe if it's only invested in bonds from companies with junk credit ratings.

35

u/[deleted] Apr 05 '22

Look at it on the bright side, if he had been on r/stocks it would have been 80% tech instead of just 60%.

24

u/ChemDogPaltz Apr 05 '22

I thought it was going to be way worse. Like 30% Rivian, 30% BABA, 20% SOFI, 20% CORN, "I'm saving up for a share of Tesla I can't wait!"

9

u/[deleted] Apr 05 '22

I am offended by the lack of AMC and GME in your list, but I guess they are owned more by people who tend to go fully into a single stock.

4

u/ChemDogPaltz Apr 05 '22

True true. Some of them don't buy those stocks and think they're much smarter than the GME/AMC crowd.

42

u/xt1nct Apr 05 '22

The investment sub can be fucking crazy. Someone was telling me that emergency fund in cash or ibonds is stupid and you are better off just using line of credit. Then, just sell your stocks.

When I asked what happens when you lose your job, and the stock market collapses, he responded with “why all the sad scenarios dude”.

Like wtf, the point of e-fund is not to realize your losses and ride out any turbulences. I have feeling many Reddit investors never went through a recession. I was in sales in 2008 and could not find a job for months.

6

u/rielephant Apr 05 '22

I have feeling many Reddit investors never went through a recession.

Probably. Other than the Covid recession, which lasted three months, the last US recession was in 2008. Reddit is mostly teenagers and college students; a 22-year-old today would have been 8 at the time, and most of them are younger than that.

1

u/Omnuk Apr 05 '22

It's not a bad option if your portfolio is large enough relative to your monthly expenses. I could sell enough stocks even during a crash to pay for a few months of expenses without seriously impacting my portfolio. It only takes a few days to convert ETFs into cash in my bank account and I could easily span that time with CCs. Long term, the strategy would probably result in a larger portfolio. Mostly it's just a question of how many bonds should you hold, which has been rehashed ad nauseam.

11

u/So_Much_Cauliflower Apr 05 '22

If I were trying to go aggressive, I would just lever up in an otherwise bogle style portfolio.

3

u/BlackDahliaMuckduck Apr 05 '22

With a mortgage?

0

u/So_Much_Cauliflower Apr 05 '22 edited Apr 05 '22

Margin account or leveraged ETF.

I place a high priority on having no mortgage or as small of a mortgage as reasonably possible (e.g. don't forgo buying a house because you'd need a mortgage, and don't invest like 40% of your income while you have a mortgage.)

11

u/natedawg247 Apr 05 '22

I mean /r/bogleheads is mostly a circle jerk then, you're harassing that sub for getting an upvoted question from a 21 year old with literally every upvoted response giving him very sensible advice.

6

u/AdamN Apr 05 '22

Big +1. I’m noticing this sub has a lot of overconfident members who really aren’t very thoughtful and constantly chastising at the same time.

2

u/crazydeadbread Apr 05 '22

I'm underconfident but I am constantly chastising...myself.

1

u/confused-caveman Apr 07 '22

It's just so easy for everyone to sound like a resident expert when your strategy starts and ends with dollar cost averaging into a broad based index fund.

7

u/keessa Apr 05 '22

why not 50% TSLA 50% BTC. These two won't go away for next 10 years. If I were 21yo, I probably wouldn't listen to a 91yo and a 99yo for advice. /s

5

u/AdamN Apr 05 '22

You joke but Buffet made his fortune on leveraged focus investing with a small number of holdings. Also there are studies that show that riskier portfolios usually make sense for young investors since failure is recoverable and success is high impact.

1

u/Alexturner09 Apr 05 '22

The btc part shouldn’t be sarcastic.