Investing in the stock market

[Chingylol]

Does anyone else invest? I started in March and have made 10x's the amount I put in. It's been a pretty crazy ride and it hasn't been easy (Have to keep up with current events and read around 2 hours a day of market analysis. Plus you actually have to know how everything works.) but damn it's fun. I read that only 14% of Americans actually invest in individual stocks which makes me sad because it almost feels like free money at times aside from doing the research.

Fun fact: If you invested $100 in Dominos Pizza in 2010, you would have made $4000 off it since then. Or if you invested $100 into Tesla in 2010, you would have made $9,000. It made me realize how much banks are scams holding your money, investing it themselves, and giving you 0.3% interest per year while they make boatloads.

[Logwyn]

Does anyone else invest? I started in March and have made 10x's the amount I put in. It's been a pretty crazy ride and it hasn't been easy (Have to keep up with current events and read around 2 hours a day of market analysis. Plus you actually have to know how everything works.) but damn it's fun. I read that only 14% of Americans actually invest in individual stocks which makes me sad because it almost feels like free money at times aside from doing the research.

Fun fact: If you invested $100 in Dominos Pizza in 2010, you would have made $4000 off it since then. Or if you invested $100 into Tesla in 2010, you would have made $9,000. It made me realize how much banks are scams holding your money, investing it themselves, and giving you 0.3% interest per year while they make boatloads.

I do but I have someone invest as it's free for where I work. They do a good job so I'm happy.
Don't forget that when you put in 100 dollars into a bank they can loan out 110 dollars or something to that effect. Banks get to create money from thin air.

[Underverse]

Individual stocks are risky. I had TLSA and sold at $450 ish (obviously a mistake) but you can't predict where these things are going to go.

On a related note, I've like the idea recently floated by (some billionaire) of the government setting up a relatively small retirement fund for each citizen at birth. Compound interest becomes crazy, especially if people can get a 2 decade head start on investing.

[Temp name]

I do but I have someone invest as it's free for where I work. They do a good job so I'm happy.
Don't forget that when you put in 100 dollars into a bank they can loan out 110 dollars or something to that effect. Banks get to create money from thin air.

Most fractional reserve banking laws have it at 10% in stock, so they'd be able to loan out 1000.

[fanorthis]

Fun fact: If you invested $100 in Dominos Pizza in 2010, you would have made $4000 off it since then. Or if you invested $100 into Tesla in 2010, you would have made $9,000. It made me realize how much banks are scams holding your money, investing it themselves, and giving you 0.3% interest per year while they make boatloads.

I agree with you that banks are corrupt. But you are retrospectively cherry-picking two outliers. The banks have to stabilize their profits on lots of stocks to keep acceptable risk levels and that includes a lot of failures.

Tesla IMHO is a very special case. There's a clear divergence between old-school wall street investors who (correctly) observe that Tesla numbers don't make any sense in a traditional valuation context, and a younger group who believe Tesla's focus on innovation makes traditional metrics invalid. The only real precedent is amazon which managed to leverage tech to control everything in retail - something that was very hard to envisage the scale of if not the general theory.

[Blueobelisk]

I only started investing a few months ago. I only invest in index funds, though.

I'd pour in a lot more money than my current rate but the market is at an all time high so...

[kamuimac]

Does anyone else invest? I started in March and have made 10x's the amount I put in. It's been a pretty crazy ride and it hasn't been easy (Have to keep up with current events and read around 2 hours a day of market analysis. Plus you actually have to know how everything works.) but damn it's fun. I read that only 14% of Americans actually invest in individual stocks which makes me sad because it almost feels like free money at times aside from doing the research.

Fun fact: If you invested $100 in Dominos Pizza in 2010, you would have made $4000 off it since then. Or if you invested $100 into Tesla in 2010, you would have made $9,000. It made me realize how much banks are scams holding your money, investing it themselves, and giving you 0.3% interest per year while they make boatloads.

not really - have some savings invested into gold - but its there for better part of last 10 years as diversification and for "black hour"

i find investing in stock way to risky and waste of time unless you invest really but $

have made other much better investments that bring me more then decent returns over years.

[freezion]

I read that only 14% of Americans actually invest in individual stocks which makes me sad because it almost feels like free money at times aside from doing the research.

In order to make any money off stock, you need money to invest.

And considering 70-ish percent IIRC in the US lives paycheck to paycheck, i think there's a long way for a lot to have the capital to make investments thats worthwhile.

[jonnysensible]

In order to make any money off stock, you need money to invest.

And considering 70-ish percent IIRC in the US lives paycheck to paycheck, i think there's a long way for a lot to have the capital to make investments thats worthwhile.

the average american dies 61000 dollars in debt!

[XDurionX]

Hindsight is 20/20. Pretty naive to think you can compete with professionals and high frequency trading as a private investor. It's basically gambling. Everything you ever read about stocks is known by the people involved weeks beforehand and already in the price.

[Ashleyxoxo]

I’m too oblivious to how it works and would just lose money. If I wanted to gamble my money, I’d play mobile games.

[Tuor]

I have an uncle that toy's with these, but went even further, he became addicted with this, in his head if he loses he needs to keep investing to recover his money, he can't say let's stop.

Careful.

[Chingylol]

Hindsight is 20/20. Pretty naive to think you can compete with professionals and high frequency trading as a private investor. It's basically gambling. Everything you ever read about stocks is known by the people involved weeks beforehand and already in the price.

Yeah that's not true at all. If you're actively trading and not a professional yes the odds are against you, but if you buy reputable stocks and hold them you're pretty much guaranteed to make a profit in the long run. Look up the stock of any big box store and how it's done in the past year and it's most likely at least doubled. Bestbuy, Home Depot, Kirklands, Big Lots, etc. Kohls is up 400% since March. Costco returns are 50% just from this year. Same with all the popular fast food places like Chipotle.

[XDurionX]

Yeah that's not true at all. If you're actively trading and not a professional yes the odds are against you, but if you buy reputable stocks and hold them you're pretty much guaranteed to make a profit in the long run. Look up the stock of any big box store and how it's done in the past year and it's most likely at least doubled.

Yes, you're pretty much "guaranteed a profit" if you neglect inflation by investing in big funds. But unless you're taking huge risks, there are no huge profits. So - gambling.

[Chingylol]

Yes, you're pretty much "guaranteed a profit" if you neglect inflation by investing in big funds. But unless you're taking huge risks, there are no huge profits. So - gambling.

Wrong. The difference between pure gambling and buying stocks of companies is that you are betting in the future of the company and you have a track record you can research. Gambling in a casino is a whole different scenario. There is no casino game that the player has an edge except for poker where you're not playing against the house. Just take a look at how big Las Vegas has become to be sure that the house always has the advantage. Investing in the stock market is doing research. If you were to just take a list of stocks and throw darts at them, it would be more similar to gambling. However, the more you learn about how companies are valued and operate the more ammunition you will have when picking stocks.

[XDurionX]

Wrong. The difference between pure gambling and buying stocks of companies is that you are betting on the future of the company and you have a track record you can research. Gambling in a casino is a whole different scenario. There is no casino game that the player has an edge except for poker where you're not playing against the house. Just take a look at how big Las Vegas has become to be sure that the house always has the advantage. Investing in the stock market is doing research. If you were to just take a list of stocks and throw darts at them, it would be more similar to gambling. However, the more you learn about how companies are valued and operate the more ammunition you will have when picking stocks.

You don't get my point. All the information you can "research" is already reflected in the price of the stock and thus useless. Every history, every projection, every trend is already reflected. There'S a reason why insider trading is forbidden.

[Blueobelisk]

Do you have a link that says 14% of Americans invest? I read that 55% own a stock if you include 401k/IRA.

[fanorthis]

Hindsight is 20/20. Pretty naive to think you can compete with professionals and high frequency trading as a private investor. It's basically gambling. Everything you ever read about stocks is known by the people involved weeks beforehand and already in the price.

That's not really true. Traders tend to look at metrics which normally give you a fairly accurate prediction of how a stock is doing and will perform in the near future. Mostly that works pretty well and consequently there's isn't much advantage to be had.

BUT if you can identify a stock that's likely to take off for reasons which aren't factored into that metric then you can make money. Much of the time small cap stocks aren't really studied that closely by big investors. Very occasionally something big like Amazon or Tesla come along where it is impossible to value using traditional methods.

I do agree most investors probably shouldn't be doing it. Value opportunities are rare, almost all the success stories I've heard are of people who might buy-in at most five or six times a year. They spend months doing research before investing.

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You don't get my point. All the information you can "research" is already reflected in the price of the stock and thus useless. Every history, every projection, every trend is already reflected. There'S a reason why insider trading is forbidden.

You need to think about the impossibility of the actuality of that statement. It is possible for everyone to simultaneously incorporate every piece of information in real-time. The random walk argument never made that much sense.

You might want to google Chris Camillo. He made a lot of money investin in things like slime and Jeffrey Starr endorsed-products. Wall St hedge fund managers are not watching those things closely.

[Zan15]

Does anyone else invest? I started in March and have made 10x's the amount I put in. It's been a pretty crazy ride and it hasn't been easy (Have to keep up with current events and read around 2 hours a day of market analysis. Plus you actually have to know how everything works.) but damn it's fun. I read that only 14% of Americans actually invest in individual stocks which makes me sad because it almost feels like free money at times aside from doing the research.

Fun fact: If you invested $100 in Dominos Pizza in 2010, you would have made $4000 off it since then. Or if you invested $100 into Tesla in 2010, you would have made $9,000. It made me realize how much banks are scams holding your money, investing it themselves, and giving you 0.3% interest per year while they make boatloads.

Free money?
Sure since you started at a historical dip in the stock market you could have almost made the same $$ by throwing a dart at a list on the wall of stocks.


Not many stocks have appreciated 10x the amount however in such a short period. sounds like you got lucky on your pick. Now try to keep that up for 2-5-10-25 years till you retire.

Market timing trades tend to average out the longer you invest.

I've lived through the Tech boom and bust, The 90's penny stock craze and bust, the commodity cluster fuck, the 1980-1990-2008 crashes and now the Covid Dip/Recovery you learn that your short term monster gains often get "averaged" out by your next expected monster gain that turns out to be a bust before you can sell it.

- - - Updated - - -

Do you have a link that says 14% of Americans invest? I read that 55% own a stock if you include 401k/IRA.

14% directly invest in individual stocks is a different statement then actual ownership in stock

the majority of people who own stocks through 401k's own funds that do the direct investing for them.

[Rasulis]

Yes, you're pretty much "guaranteed a profit" if you neglect inflation by investing in big funds. But unless you're taking huge risks, there are no huge profits. So - gambling.

It is not too bad. I’ll use my favorite fund as an example - FSCSX. The fund inception date was 1985. One of the oldest large cap tech index fund out there. Annualized return: YTD - 39.12%, 3yr - 27.89%, 5yr - 24.55%, 10yr - 21.17%, lifetime - 16.71%. That’s after 0.7% expense.

In the last 35 years, inflation grew between 0.1% (2008) and 6.1% (1991). With few exceptions, between 2000 and 2020, inflation grew at the rate of less than 3%.

Then there are taxes. Keep in mind that we don’t have to pay taxes until we actually sell the fund. Long-term capital gain taxes depend on income. For married couple making less than 80,000 in 2020, long term capital gain tax rate is zero, 80,000 to 496,000 - 15%, and more than 496,000 - 20%. The rate applies to the dividend that you get from the fund also. Those are much lower rate than the regular Federal tax rate which is capped at 37%. We are also talking about taxable income and not gross income.

With the right withdrawal strategy, more people enjoy the 0% rate than you might think. Mainly retirees obviously.