You know, there’s a lot of living inside these charts. It’s easy to forget how much goes on in your life in a week, never mind a year. You can see above how the Dow Jones Industrial Average performed from 1965-1981. But back then, like today, you didn’t know what tomorrow would bring. A lot of what matters for your investment success is not how old this bear or that bull market is—it’s how old or young you are. Everyone’s a long-term investor until they lose money. When we’re young, just starting out, we’re trying to raise a family, pay the mortgage, and save as much as we can. … [Read more...]
Investing Mistakes to Avoid: #8 “Get Back”
Last year (2022) was brutal for the major averages (not including dividends): Nasdaq -33.1%, Russell 2000 -21.6%, S&P 500 -19.4%, and the Dow Jones Industrial Average -8.8%. But not all investors hung around to see things through. And you know this song: Markets are back up this year. Let’s rewind. When the going gets tough, the capitulation begins. And in my observation, a breaking point is reached when a portfolio goes below a certain number. It has nothing to do with the major averages per se. It has everything to do with dollar signs. Will we have enough to live on? And the … [Read more...]
HELP: Your Survival Guy is Under Immense Pressure
Your Survival Guy’s under immense pressure. (I thought you’d enjoy reading that). But it’s real. I can feel it. And I’m not talking about investing. I can handle that kind of pressure. No, I’m talking about planning for holiday weekends and special anniversaries. One evening this week, Your Survival Guy was in the kitchen sipping a glass of white, listening to music, and washing vegetables when Your Survival Gal asked, “Have you thought about our anniversary?” I looked up for a moment, staring into space, wondering how one might respond. “Yes,” I said, hoping someone might come in asking … [Read more...]
READER RESPONSE: Remember When You Were A Kid and Money Was Free?
You may have been thinking back to your childhood when you read this month's RAGE Gauge, titled "Remember When You Were A Kid and Money Was Free?" Maybe you were thinking about how much work it took to earn enough money for a movie and some ice cream on the weekend back then. Or maybe about how much more that costs now. After reading the June RAGE Gauge, my friend John wrote to me to describe how his parents encouraged him to earn money as a child and young man, and how he passed that valuable work ethic and saver's mentality on to his own children. He wrote: Good morning E.J., Your … [Read more...]
Investing Mistakes to Avoid: #9 Hobbyist or Hobbit?
“We are plain quiet folk and have no use for adventures. Nasty disturbing uncomfortable things! Make you late for dinner!” said Bilbo Baggins to Gandalf in The Hobbit. Which leads me to “Investing Mistakes to Avoid: #9 Hobbyist or Hobbit?” This is a story about a recently retired investor. The hobbyist investor. The most dangerous one of all. You see, it’s the recently retired investor who, with a fresh outlook on life, thinks he doesn’t need “experts” to guide him. Who yearns for one more bite of the apple. Who imagines himself scoring with artificial intelligence or high-yield … [Read more...]
The Value of Being an Expert
I like this piece from Cal Newport, who emails me regularly (and will email you, too, if you're a subscriber to his emails). He writes mostly about optimal productivity, organizational behavior, unplugging your digital life, time management, etc. In this piece, he writes about the value of being an expert (or relying on one) through slow productivity to differentiate yourself from the everyday tasks everyone else you know is doing. Enjoy. I found myself recently, as one does, watching the mini-documentary featurettes included on the DVD for the popular 2014 Keanu Reeves movie, John Wick — an … [Read more...]
The Highest Duty Known to the Law?
You know from here and here that Your Survival Guy wants you working with a fiduciary, someone who serves you, not two masters. Here’s great wording by Jack Bogle: The concept of fiduciary duty has a long history, going back more or less eight centuries under English common law. Fiduciary duty is essentially a legal relationship of confidence or trust between two or more parties, most commonly a fiduciary or trustee and a principal or beneficiary, who justifiably reposes confidence, good faith, and reliance on his trustee. The fiduciary is expected to act at all times for the sole benefit and … [Read more...]
Serving Two Masters is No Way to Invest
Are you working with a fiduciary? What is a Fiduciary? In “The Fiduciary Principle: No Man Can Serve Two Masters,” the founder of The Vanguard Group, John (Jack) Bogle, explained the fiduciary duty as follows: “The fiduciary is expected to act at all times for the sole benefit and interests of the principal, with loyalty to those interests.” Nowhere in Bogle’s full definition (here) does he mention allowing a firm’s politics to guide it. But that’s exactly what has happened with ESG. The ESG Cartel Is Vanguard Voting Against Your Political Beliefs? Was Silicon Valley Bank a Victim … [Read more...]
Investing Mistakes to Avoid: #10 Picked Off First
Your Survival Guy has compiled a list of investing mistakes to avoid. It's a list for highly successful, fairly wealthy investors. Today's lesson is what I refer to as "Picked off first." Do not get picked off first base. When you have some money, or in my example, get a hit, you need to protect yourself. You can't afford to be picked off and sent to the dugout. But it happens with far too much frequency because investors are caught sleeping. Here's what I'm talking about. One of the first things you learn about investing in bonds is the risk-free rate of return. You can see it below. … [Read more...]
Successful Investing Is a Mindset
Dick Young wrote in the October 2015 issue of Intelligence Report: As you know, I do not check the prices of my investments daily, weekly, or even monthly. I do an annual checkup only at tax time. When I make a significant investment, I have no intention of liquidation anytime soon. I am in for the long haul. Thus, short- or even medium-term volatility is of zero concern to me, beyond keeping an eye out for a name on my watch list that may have taken a temporary beating due to no particular fault of its own. So, then, successful investing is a mindset based upon a master plan that … [Read more...]
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