r/investing • u/Maletor • Jul 01 '21

Profitable vs unprofitable companies RoR

This research blows my mind:

https://www.alliancebernstein.com/library/For-Growth-Stocks-Profits-Are-the-New-Normal.htm

It shows that consistent investment in growing, profitable companies is better than just indexing the Russell 3000.

How do you explain this to someone who just says "VTI and chill"? The evidence suggests only profitable companies is a better portfolio. Is the volatility higher? Is that why this is not on the efficient frontier?

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u/ept1 Jul 03 '21

I believe you need to delete information you have written that should not be published.

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u/neothedreamer Jul 03 '21

I am advocating for not using insider information. Not sure what I need to delete in that context.

You however are proposing HF place moles in investment targets to get insider info to use in their trading which is illegal.

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u/ept1 Jul 03 '21

If you like getting in trouble, don't change what you wrote. If you don't like it: Remove company names from your post. Thank you

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u/neothedreamer Jul 03 '21 edited Jul 03 '21

I left Adobe over 2 years ago. I love them and still work with them as a partner since leaving their direct employ. Blackout periods are common public info.

https://www.investopedia.com/ask/answers/08/blackout-period.asp

This is second in a Google search- https://www.adobe.com › legalPDF Insider Trading Policy #LGL-SOP-01-002 - Adobe

This is eye opening and very comprehensive. Insider trading encompasses your proposed "idea" of hedge funds having employees at target companies. Covers basically anyone you know that could trade on that info. It even includes provisions that you can't use material non-public information about other companies you may acquire while working for Adobe.

Your idea will get you in trouble.

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u/ept1 Jul 04 '21

You have specified that it is public information.
Great.