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Motown Bombers
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Decided to bring the investing thread over to this forum since I started my first foray into investing. I'm pretty low risk and conservative when it comes to investing. I opened up a managed investment account and started buying some individual stocks. The first stock I bought of course was a weed company. Next I bought Merck since they make the dewormer everyone is taking.  All told I spent only $500 on individual stocks. So far they have collectively lost $0.50 and it's still bothering me. I probably won't spend much more on individual stocks and spend more on my managed account since I don't want to get in over my head. I'll leave it to the experts to chime in with their investing advice. 

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I've been investing since I was 18 but have only been in mutual funds. Over the many years we have done well.  Some people are really good with individual stocks but I like the idea of many stocks in one basket with a mutual fund.  I would like a lot more days like yesterday.

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I had been putting a portion of my pay in a savings account. That is only accruing 0.55% interest. I have well over 6 months in savings so I wanted to contribute now to something that will earn a larger return than 0.55%. I took $1,000 for now and put $500 in a mutual fund and the other $500 in individual stocks. I wanted to see my return before I risked more money. I have no idea when I should buy or sell stocks. I bought relative safe companies but only small shares for now. The mutual fund I set up is more conservative with investments in more bonds than stocks. 

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Everything I have is through Fidelity and I manage it myself.  My brother goes through an independent broker.  He makes about the same as I do each year but he pays a lot of fees.  I recommended Fidelity because there is a lot of info and research available but the others are good too.  I just started with Fidelity, not knowing anything and learned the ropes.  There are a tons a mutual funds and many are a like. I started with $100 in an Equity Fund.  I've invested a lot since then but also had some really good years of returns.  I plan on retiring in about year.

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On 10/15/2021 at 2:24 PM, Archie said:

Everything I have is through Fidelity and I manage it myself.  My brother goes through an independent broker.  He makes about the same as I do each year but he pays a lot of fees.  I recommended Fidelity because there is a lot of info and research available but the others are good too.  I just started with Fidelity, not knowing anything and learned the ropes.  There are a tons a mutual funds and many are a like. I started with $100 in an Equity Fund.  I've invested a lot since then but also had some really good years of returns.  I plan on retiring in about year.

I do all my own investing also.  When I started I put all of our money in 5 different funds that I took weeks to research.  They are doing really well.  Since then I take fliers on random companies here and there with a few hundred...those are up and down, but my main ones are the ones doing well.

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On 10/15/2021 at 1:53 PM, Motown Bombers said:

I had been putting a portion of my pay in a savings account. That is only accruing 0.55% interest. I have well over 6 months in savings so I wanted to contribute now to something that will earn a larger return than 0.55%. I took $1,000 for now and put $500 in a mutual fund and the other $500 in individual stocks. I wanted to see my return before I risked more money. I have no idea when I should buy or sell stocks. I bought relative safe companies but only small shares for now. The mutual fund I set up is more conservative with investments in more bonds than stocks. 

Day trading is a different animal than investing for retirement.  My goal is long haul so I put the money in and do not touch it.  

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19 minutes ago, John_Brian_K said:

Since the last Investing thread I have bought about 6-7 individual stocks based on stuff I have heard.  Maybe 3-4k on those, but all of our real money goes into mutual funds.

We are in 17 different positions right now.  Fairly diversified I think.

the choice for mutual funds vs direct investing has changed a lot in recent years. Not too long ago it was expensive to buy stock in lots of less than 100 shares, and since you need to own maybe a dozen or maybe even 20 (depending on your taste)  individual stocks to meet your diversification tolerance, it was less expensive for smaller investors to use mutual funds even if they had the inclination to do their own stock picking. Today, stock purchase commissions are tiny and odd lot penalties are a thing of the past, so the value of mutual funds for 'active' small investors is much smaller than it used to be. Now in theory, if you don't want to do a lot of research, it should be easier to find a mutual fund that matches your objectives and performs to your demands than to pick individual stocks, but again, the context has changed a lot. When I started investing there were a lot fewer reasonable mutual funds to choose from than there were stocks. Today I'd wager there are more mutual funds and ETFs to research than there are stocks to pick so the question becomes - why bother with the middle man? I wouldn't tell anyone to avoid ETFs or mutual funds, as long as their charges are low, they are fine. I would just say the small investor "needs" them less than they used to. Or at least the amount of money you are managing before being comfortable with a transition to individual stock picking is much lower.

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I ended up scrapping the sofi account in favor of some Fidelity mutual funds. My 401k is through Fidelity so I figured I would keep it all together. I made small investments in large growth, mid cap and total bonds funds for now. Only invested a little to get my feet wet. I noticed back in 2013 I invested a small portion of my 401k into a real estate fund. Totally forgot about and come 2021 that real estate fund exploded. 

Somewhat related to investing, I leased a Chevy Trax in 2019 right before the pandemic as a commuter car. The pandemic hit and I've worked from ever since and the car has remained parked with low miles Now with this chip shortage, I have dealers fighting with each other to buy my Trax. I have offers upwards of $5,000 over the lease payoff. They are literally offering more than what I paid for it new. Who would have thought a Chevy Trax would have appreciated in value?

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9 minutes ago, Motown Bombers said:

I leased a Chevy Trax in 2019 right before the pandemic as a commuter car. The pandemic hit and I've worked from ever since and the car has remained parked with low miles Now with this chip shortage, I have dealers fighting with each other to buy my Trax. I have offers upwards of $5,000 over the lease payoff. They are literally offering more than what I paid for it new. Who would have thought a Chevy Trax would have appreciated in value?

HaHa - another "better to be lucky than good" outcome. Good for you

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2 hours ago, Motown Bombers said:

I ended up scrapping the sofi account in favor of some Fidelity mutual funds. My 401k is through Fidelity so I figured I would keep it all together. I made small investments in large growth, mid cap and total bonds funds for now. Only invested a little to get my feet wet. I noticed back in 2013 I invested a small portion of my 401k into a real estate fund. Totally forgot about and come 2021 that real estate fund exploded. 

Somewhat related to investing, I leased a Chevy Trax in 2019 right before the pandemic as a commuter car. The pandemic hit and I've worked from ever since and the car has remained parked with low miles Now with this chip shortage, I have dealers fighting with each other to buy my Trax. I have offers upwards of $5,000 over the lease payoff. They are literally offering more than what I paid for it new. Who would have thought a Chevy Trax would have appreciated in value?

Identical situation with my Equinox. My dealer didn't even have any new ones. I couldn't replace it so I bought it. Could still sell it for more than I owe. Never had anything like that in my life.

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2 hours ago, gehringer_2 said:

the choice for mutual funds vs direct investing has changed a lot in recent years. Not too long ago it was expensive to buy stock in lots of less than 100 shares, and since you need to own maybe a dozen or maybe even 20 (depending on your taste)  individual stocks to meet your diversification tolerance, it was less expensive for smaller investors to use mutual funds even if they had the inclination to do their own stock picking. Today, stock purchase commissions are tiny and odd lot penalties are a thing of the past, so the value of mutual funds for 'active' small investors is much smaller than it used to be. Now in theory, if you don't want to do a lot of research, it should be easier to find a mutual fund that matches your objectives and performs to your demands than to pick individual stocks, but again, the context has changed a lot. When I started investing there were a lot fewer reasonable mutual funds to choose from than there were stocks. Today I'd wager there are more mutual funds and ETFs to research than there are stocks to pick so the question becomes - why bother with the middle man? I wouldn't tell anyone to avoid ETFs or mutual funds, as long as their charges are low, they are fine. I would just say the small investor "needs" them less than they used to. Or at least the amount of money you are managing before being comfortable with a transition to individual stock picking is much lower.

When I first started really investing I noticed I could not really just buy stocks for a company I thought was worth it because like you said the price was too high or the shares you were forced to buy pushed it out of my range at the time.  Now I have money that goes directly into a money market account and get transferred from there to the stocks of my choice...there is usually a good amount left over so I dabble with that money into random stocks that I hear about, the latest was BOXL, GTE and ZEN. 

I need to stay away from crypto though.  My timing on those is really bad because I only buy it when I hear about it from an outside sourse...by that time it is WAAAAY too late to get in on it, but I think everyone wants a piece of whatever Crypto ends up taking over for the dollar so it is hard to pass them up.  

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I was directing 10% of my take home pay into a savings account. Now that I have a comfortable rainy day fund, I want to direct that to my new investments and do an auto invest. Should I divide it evenly among the three mutual funds I own? Should I favor one over the other? I'm really not sure how to read the market and know when to sell. From my research, these funds I bought were given high grades and many were giving them buy ratings. I'm also already seeing the importance of diversification. Two of my mutual funds lost yesterday while one gained more than the other two and on the whole I ended up with a gain instead of a loss. 

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3 hours ago, Motown Bombers said:

What more information do you need? 

Are you in it for the long haul or are you planning on day trading?  Do you want funds to sit and grow or will you sell them at some point in the near future?  Within 2-3 years or even sooner?

What is your risk tolerance?

What are the funds?

 

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On 10/15/2021 at 1:26 PM, Motown Bombers said:

Decided to bring the investing thread over to this forum since I started my first foray into investing. I'm pretty low risk and conservative when it comes to investing. I opened up a managed investment account and started buying some individual stocks. The first stock I bought of course was a weed company. Next I bought Merck since they make the dewormer everyone is taking.  All told I spent only $500 on individual stocks. So far they have collectively lost $0.50 and it's still bothering me. I probably won't spend much more on individual stocks and spend more on my managed account since I don't want to get in over my head. I'll leave it to the experts to chime in with their investing advice. 

I bought a tiny bit of Merck about 25 years ago just for fun and never sold it.  Although still tiny, It has grown immensely.  Other than that, I have invested almost entirely in mutual funds.  It's probably less fun, but it feels safer and more practical than investing in individual stocks.  

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I just buy the index.  Over time it is a low second quartile performer compared to other equity mutual funds, with minimal fees.

Watch out for your bonds.  If interst rates go up, which seems likely, your bond fund goes down.  A lot of "financial advisors" don't seem to know that.  They just remember that risk hierarchy in their textbook, bonds are "less risky".

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28 minutes ago, Jim Cowan said:

I just buy the index.  Over time it is a low second quartile performer compared to other equity mutual funds, with minimal fees.

Watch out for your bonds.  If interst rates go up, which seems likely, your bond fund goes down.  A lot of "financial advisors" don't seem to know that.  They just remember that risk hierarchy in their textbook, bonds are "less risky".

The problem is stocks usually take a dive too when interest rates go up.  

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  • 1 month later...

Late to this thread but I enjoy the conversation. I retired in May of 2017. I invested without fail for over 30 years in a 401K. The 401K was still relatively new to the marketplace for the average investor when I began contributing. As I recall, I began contributing 6% of my salary initially. Then I moved to 10% and then 15%. For about 30 years I contributed 15% of my salary. 
If I were to offer advice…I would advise that 15% is a base to work off of, 20% if you possibly can. Everyone’s situation is different. This includes the options you may or may not have through your employer. Personally, and I do invest fairly conservatively, I would avoid individual stocks in a retirement account. If you want to buy a few stocks here and there, do it outside money you’re relying on for retirement. Be very aware of fees. Again, your employer is choosing the options you have but be very aware of what you’re paying in fees. 
A good S&P fund or ETF is fine. The S&P beats practically everything out there year in and year out. The yield is generally around 2%, historically speaking. If you’re relatively young, ignore the market and don’t stop contributing. 
Educate yourself on investing. I think most here have by reading the comments. Don’t make this complicated, it’s not. 
Lastly, the most under utilized investment vehicle in this country is the Roth IRA. If at all possible, and again everybody’s situation is different, try to max one of these out every year. I feel for younger investors in this country right now, my son included. SS may or may not be around and at the rate we’re going taxes are going to be a bear. Pensions are long gone. 
As a FWIW, I’m a Vanguard fan. 

I subscribe to Morningstar for dabbling in individual stocks now that I’m retired. They are a good resource if anyone is interested. A Premium annual subscription was $199 a few months back. They have a lot of good information for review. 
Apologies for getting long. 

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On 12/1/2021 at 10:17 PM, 1776 said:

Late to this thread but I enjoy the conversation. I retired in May of 2017. I invested without fail for over 30 years in a 401K. The 401K was still relatively new to the marketplace for the average investor when I began contributing. As I recall, I began contributing 6% of my salary initially. Then I moved to 10% and then 15%. For about 30 years I contributed 15% of my salary. 
If I were to offer advice…I would advise that 15% is a base to work off of, 20% if you possibly can. Everyone’s situation is different. This includes the options you may or may not have through your employer. Personally, and I do invest fairly conservatively, I would avoid individual stocks in a retirement account. If you want to buy a few stocks here and there, do it outside money you’re relying on for retirement. Be very aware of fees. Again, your employer is choosing the options you have but be very aware of what you’re paying in fees. 
A good S&P fund or ETF is fine. The S&P beats practically everything out there year in and year out. The yield is generally around 2%, historically speaking. If you’re relatively young, ignore the market and don’t stop contributing. 
Educate yourself on investing. I think most here have by reading the comments. Don’t make this complicated, it’s not. 
Lastly, the most under utilized investment vehicle in this country is the Roth IRA. If at all possible, and again everybody’s situation is different, try to max one of these out every year. I feel for younger investors in this country right now, my son included. SS may or may not be around and at the rate we’re going taxes are going to be a bear. Pensions are long gone. 
As a FWIW, I’m a Vanguard fan. 

I subscribe to Morningstar for dabbling in individual stocks now that I’m retired. They are a good resource if anyone is interested. A Premium annual subscription was $199 a few months back. They have a lot of good information for review. 
Apologies for getting long. 

I currently put away 21% of my take home. 6%, which is matched by the employer, goes to a 401k and the other 15% in just a savings account. I did invest in mutual funds and they were doing well but this past week or so have lost a lot. I'm not sure if I should sell or just ride it out. This is the part of investing I hate. 

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You are doing a fantastic job with your investing/saving plan, fantastic! That’s what it is going to take to retire comfortably. Stay the course. 
In this current market environment I have been moving some cash into my funds. Not a lot, but a little here and there on the more red days. Sounds odd I know, but I ‘d like to see a market pullback of 10%. Funds are a little pricey right now. 

One huge component in investing is having a plan. This includes how to, or how not to, deal with a volatile market BEFORE you encounter one. I don’t know your age or when you plan to retire. But as a general principle I would say do not sell your funds. The biggest problem investors make is trying to time the market. It is futile and there are tons of articles supporting my position on this. In fact, market downturns are the best time to BUY! When the market turned down in February-March 2020, I was buying incrementally. I am a long term guy. 
As a closer, I’ll quote the late founder of Vanguard, John Bogle, when he offered advice on what to do when the market is going crazy. He said, “Don’t just do something, stand there!” 
Ignore the market and the noise and stay with your contribution rate. If you continue to invest as you are doing and the market pulls back you’ll be getting more for your money on your purchases. 

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