If you've investigated investing in stocks at all, you're probably feeling overwhelmed by all the possible strategies, but to my mind, there are really only two: passive and active.
Passive generally means you buy an index fund (you could also create your own list of stocks) pressing the buy button and then doing NOTHING. Active means you are a badass, so smart you can beat the market, almost always picking winners, holding them for the right amount of time and then, with cold rationality, selling and buying something else. Hedge funds are active, betting both on things going up and going down. Which is the best? You can find good arguments for both but Warren Buffett recommends passive so that's where I would bet my money.
And I do.
Mostly.
If a passive strategy is so great -- remember, passive has Buffet's imprimatur -- why am I not all in on passive investing and using my precious free time for, say, playing my guitar, instead of researching stocks? Because doing nothing is hard. Really hard, especially for a chronic market watcher like me. Every day, I check the market at least 10 times, scrolling though my list of holdings, reading market news, mulling, pondering, fretting, getting excited. And what about my index funds? I never look at them. Ever.
So which strategy is winning for me? Hard to believe, but in the short term (last 10 years) my active strategy is trouncing my passive holdings. And that's a problem because as we enter May, even though my active holdings are up nearly 3x my passive, they are well off their year highs, prompting me to wonder, should I "sell in May and walk away", as the old adage counsels. Fueling my jitters is global news, always bad but now a bit over the top with North Korea testing short range missiles, Trump threatening higher tariffs against China, Pompeo on a midnight flight to Iraq because of concerns about Iran, Iran announcing it was no longer adhering to the nuclear deal signed in Obama's last year, Trump's AG being held in contempt of Congress over the Mueller report, Russia fiddling with elections all over the world and on and on and on.
But here's the deal: worst case scenario, we get into a nuclear war and the market goes all to hell, in which case I think gold bars held in my own vault would be best; next worse case, war, in which case, who knows, but probably not good in the near term; three, Trump is impeached and convicted or not, a short term blip. So, given that I am not going to buy a bunch of gold and put it in a pricey vault and every other scenarios are likely temporary blips, I'm going roll up my sleeves, grit my teeth and... do nothing. Seriously, how hard can it be?
Okay, I'm already wavering...
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