The wealth-building thread

[HiFidFan]

https://www.investopedia.com/terms/p/price-action.asp

You (might) get a feel for how prices move if you watch long enough.

Draw some lines, see where price goes, where it stops, where it reverses.

I don't do "indicators".

Don't trade too often, and don't trade too big.

Caught your edit. . . You say you trade price action, show a chart with none, but fib extensions instead. (?)

If one draw lines, are those lines not "indicators"?

I'm confused.

 

[HiFidFan]

https://www.investopedia.com/terms/p/price-action.asp

You (might) get a feel for how prices move if you watch long enough.

Draw some lines, see where price goes, where it stops, where it reverses.

I don't do "indicators".

Don't trade too often, and don't trade too big.

Don't let a winner turn into a loser if you can help it.

Don't be a pig.

Don't be shy.

If you need "confirmation" to make a trade, much of the opportunity may have already passed.

Dow mostly just swings back and forth, up a hundred, down two hundred, up two hundred, It's kinda hard to be "wrong" if you can wait till the breeze starts blowing in the other direction when you're initially wrong.

Trading takes a little study, find something that works for you. All successful small traders I've talked to have their own 'thing" that they make work for them.

Lol, allrighty then. . .

I'm starting to wonder if you really understand "price action" and its use.

 

[JeffS7444]

I don't understand what sort of goal you actually have though. Are you simply looking for advice on where/how to invest your money for the sake of returns after some period? If that's the case, then a few basic classes on investing would be decent enough. And then after that, turn into an analyst (but one that actually does something with respect to research, and not like these morons that barely have a clue on what they're talking about, but for some reason get paid by investment banks to state the obvious after said bank has already gone all-in weeks prior). Or get ready to pay a broker.

No, not particularly looking for capital gains on the stock market so much as wanting to explore "Rich Dad" author Robert Kiyosaki's emphasis on investments and businesses which generate income, at a lower tax rate than I'd get if I worked as an employee for someone else. Up until now, all I've focused on was capital gains, but unrealized capital gains can and do vanish in a stock market crash: I've already weathered the crashes of 2000 and 2008 and know this much is true. By not panicking, I eventually recovered, but it took years. And how inconvenient it could be if another crash forced me to postpone retirement.

Regarding financial advisors, I Will Teach You To Be Rich author Ramit Sethi stresses the need to chose ones who are fiduciaries, i.e. who work in the interest of their clients. Pretty sure that brokers by definition are not fiduciaries so much as salesmen.

How's your investment in Taiwan Semiconductor worked out for you? I put a bunch of money into Warren Buffett's company 20+ years ago, and it's done alright: Insurance and candy may not be thrilling to talk about, but people buy 'em year in and year out.

 

[RayDunzl]

Right, but where is it on your example chart?

Price movment = price action.

IF you can't read a chart at all learn to do that first.

 

[RayDunzl]

You say you trade price action, show a chart with none, but fib extensions instead. (?)

Price movement = Price Action

Fibs are a method of examining limits of movements.

I think of :indicators as that long list of wavy lines you can apply to a chart - moving average, bollinger bands, etc, etc, etc.

They're all "late". Find something that works "early" - gives a target or decision point.

And no, I can't teach you how to trade, you have to do that to yourself.

 

[raif71]

I've been hearing we're in a "bubble" for the last 15 years.

Yup and when "bubble" burst, these people will be saying "I told you so".

 

[HiFidFan]

Price movment = price action.

IF you can't read a chart at all learn to do that first.

Sorry if I'm a bother but I was simply asking for you to show an example of price action, and how the chart you posted does that. All you've done so far is dodge and speak in generalities that anyone could hear from a late night "investing" infomercial. If you don't want to answer straightforward questions, don't offer.

 

[RayDunzl]

Uh-huh.

Have a good one.

 

[HiFidFan]

Uh-huh.

Have a good one.

That response was certainly easy to forecast

 

[LeftCoastTim]

I've been hearing we're in a "bubble" for the last 15 years.

That's right. All the value guys (including W. Buffett) have gotten crushed, and are basically indexing now.

There is no wrong way to make money (just illegal ones). But nothing wrong with holding some cash to ride out (and take advantage of) any potential volatility.

 

[A Surfer]

I'll say what I did 15 years ago. The companies that will really, really do well are those who find ways to grow food in our new climate change reality and those that can clean up our contaminated water and soil. You can live without everything else but food and water, and in case they aren't talking about it enough in the financial media we are potentially on the brink of food and water calamity. If you think governments paid through the teeth for vaccines, and they did, wait until food and water becomes that much of a hot commodity due to scarcity. Doom and gloom prediction I know, but kind of obvious I think.

 

[HiFidFan]

I'll say what I did 15 years ago. The companies that will really, really do well are those who find ways to grow food in our new climate change reality and those that can clean up our contaminated water and soil. You can live without everything else but food and water, and in case they aren't talking about it enough in the financial media we are potentially on the brink of food and water calamity. If you think governments paid through the teeth for vaccines, and they did, wait until food and water becomes that much of a hot commodity due to scarcity. Doom and gloom prediction I know, but kind of obvious I think.

Clean, abundant water is definitely a concern. Apparently China has a huge problem on both fronts. They can (and are) dam clean water sources that feed into India. Talk about a nightmare scenario.

 

[preload]

But nothing wrong with holding some cash to ride out (and take advantage of) any potential volatility.

All the people holding onto cash for the past 1 year missed out on a 36% return on the S&P500.
While the boring people who just left everything in the S&P500 are shopping for Wilsons right now.
My big question is what % of their portfolio were the "traders" actually trading vs. kept in cash?

 

[HiFidFan]

All the people holding onto cash for the past 1 year missed out in a 36% return on the S&P500.

Cash is part of every sensible portfolio.

 

[A Surfer]

Clean, abundant water is definitely a concern. Apparently China has a huge problem on both fronts. They can (and are) dam sources that feed into India. Talk about a nightmare scenario.

Going to be lots of problems here at home. Some US are virtually water dead and those states are going to be clamoring for the great lakes to be drained to feed the swimming pools in the back yards of people who live in a desert and the terribly wasteful surface irrigation of crops in Texas (to name only a few). California grows so much food for the world, certainly for North America and it is burning worse every single year. Hold onto your hats, it is going to be a wild ride.

 

[HiFidFan]

My big question is what % of their portfolio were the "traders" actually trading vs. kept in cash?

Define "traders". From what I understand many traders are 100% cash by market close.

 

[JeffS7444]

All the people holding onto cash for the past 1 year missed out on a 36% return on the S&P500.
While the boring people who just left everything in the S&P500 are shopping for Wilsons right now.
My big question is what % of their portfolio were the "traders" actually trading vs. kept in cash?

Some liquidity is a great idea, but big dummy me, I had too much cash sitting in money-market accounts for more years than I care to think about, and at current rates, $10K earns less than $100 interest annually. Fortunately, I fixed that back in 2019. But regardless, it's all unrealized gains for me, and why would I waste money on Wilsons anyway when I could have LInkwitz LX521?

 

[samsa]

Cash is part of every sensible portfolio.

Diversification is a feature of every sensible portfolio. To OP (who was looking at his retirement portfolio), here's the asset allocation of my retirement portfolio:

Large-Cap (S&P 500)                  28%
Mid-Cap (S&P 400/Russell MidCap)     12%
Small-Cap (Russell 2000)              9%
EAFE                                 21%
Emerging Markets                      6%
Real Estate (MSCI US REIT Index)      7%
US Bonds                             12%
Foreign Bonds                         5%

All in low-cost index funds, which track the relevant index.

 

[Chromatischism]

Diversification is a feature of every sensible portfolio. To OP (who was looking at his retirement portfolio), here's the asset allocation of my retirement portfolio:

Large-Cap (S&P 500)                  28%
Mid-Cap (S&P 400/Russell MidCap)     12%
Small-Cap (Russell 2000)              9%
EAFE                                 21%
Emerging Markets                      6%
Real Estate (MSCI US REIT Index)      7%
US Bonds                             12%
Foreign Bonds                         5%

All in low-cost index funds, which track the relevant index.

Are you open to constructive criticism?

Pull up the boat anchors (lose the bonds) and slash the international funds. They are only holding you back.

 

[HiFidFan]

Are you open to constructive criticism?

Pull up the boat anchors (lose the bonds) and slash the international funds. They are only holding you back.

And reallocate to what?