In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
-
- Posts: 224
- Joined: Sat Apr 25, 2020 8:28 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I'm 22 so I'm probably 'young' enough to answer here.
There are a few things I'm going to address here:
1. The average young person isn't investing in meme stocks, they're not investing in stocks at all
The internet would have you think that everyone is investing in the market. Only 50% of the US population invest indirectly or directly in the market at all and only 15% of the US population directly invest in the stock market. Most Americans are not investing in tech/meme stocks and that is especially true for young people who are less likely to participate in the market than older people.
The bloodbath that you saw was because of institutional investors, not retail investors. It's the same with the GameStop 'squeeze' last year - there was a narrative in the media that retail was moving the market when this is clearly not true. Institutional investors were the ones 'pumping' up the price and selling between each other.
2. Passive management only works because investors invest in actively managed strategies or directly invest into the market
Passive management only works because of something called price discovery. Any individual or institution buying or selling shares of meme stocks or tech stocks or whatever stock that currently grates your jaw IS a good thing for the market as a whole. If a stock trade has low volume, it increases the chance of the asset being mis-priced.
If a young person wants to invest in tech stocks, this is a good thing for index investors as a whole.
3. The market isn't efficient
I think I don't need to elaborate more but the market clearly isn't efficient. I remain pretty convinced that alpha generation is possible both in public and private markets. If a young person wants to attempt to generate alpha or increase their returns through beta, why should they change their strategy? It seems patronizing to have someone tell them that what they're doing is dumb - yes, chances are, most investors can't find meaningful alpha but that doesn't mean they shouldn't try.
4. Not every investor has the same risk tolerance or aims
This links to the point above. My risk tolerance as a young guy is much different to an elderly widow for example. I've got the benefit of time on my hands that older investors probably do not. I'm running a book that would make said widow faint - yes, it probably is foolish but I'm not going to listen to other people without making my own mistakes. For example, 25% of my portfolio could be described as being 'Boglehead'-like but the rest is much more actively managed.
i) 25% of my holdings in SPY, which is the more Bogleheads portion of my portfolio.
ii) 25% of my holdings in a market neutral model I'm running
iii) 50% of my holdings in e-mini futures (the leverage on which might make someone faint but I do adjust leverage on a periodic basis)
And look, I'm not pretending that I'm not taking extraordinary risks. I'm definitely taking more risks than I should.
But as a young person, someone lecturing me wouldn't convince me about the error of my ways, it would make me run the other way.
There are a few things I'm going to address here:
1. The average young person isn't investing in meme stocks, they're not investing in stocks at all
The internet would have you think that everyone is investing in the market. Only 50% of the US population invest indirectly or directly in the market at all and only 15% of the US population directly invest in the stock market. Most Americans are not investing in tech/meme stocks and that is especially true for young people who are less likely to participate in the market than older people.
The bloodbath that you saw was because of institutional investors, not retail investors. It's the same with the GameStop 'squeeze' last year - there was a narrative in the media that retail was moving the market when this is clearly not true. Institutional investors were the ones 'pumping' up the price and selling between each other.
2. Passive management only works because investors invest in actively managed strategies or directly invest into the market
Passive management only works because of something called price discovery. Any individual or institution buying or selling shares of meme stocks or tech stocks or whatever stock that currently grates your jaw IS a good thing for the market as a whole. If a stock trade has low volume, it increases the chance of the asset being mis-priced.
If a young person wants to invest in tech stocks, this is a good thing for index investors as a whole.
3. The market isn't efficient
I think I don't need to elaborate more but the market clearly isn't efficient. I remain pretty convinced that alpha generation is possible both in public and private markets. If a young person wants to attempt to generate alpha or increase their returns through beta, why should they change their strategy? It seems patronizing to have someone tell them that what they're doing is dumb - yes, chances are, most investors can't find meaningful alpha but that doesn't mean they shouldn't try.
4. Not every investor has the same risk tolerance or aims
This links to the point above. My risk tolerance as a young guy is much different to an elderly widow for example. I've got the benefit of time on my hands that older investors probably do not. I'm running a book that would make said widow faint - yes, it probably is foolish but I'm not going to listen to other people without making my own mistakes. For example, 25% of my portfolio could be described as being 'Boglehead'-like but the rest is much more actively managed.
i) 25% of my holdings in SPY, which is the more Bogleheads portion of my portfolio.
ii) 25% of my holdings in a market neutral model I'm running
iii) 50% of my holdings in e-mini futures (the leverage on which might make someone faint but I do adjust leverage on a periodic basis)
And look, I'm not pretending that I'm not taking extraordinary risks. I'm definitely taking more risks than I should.
But as a young person, someone lecturing me wouldn't convince me about the error of my ways, it would make me run the other way.
Last edited by DarkMatter731 on Mon Jan 24, 2022 4:44 pm, edited 2 times in total.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Every once in a while I will get a general question about re-balancing or harvesting losses from a sibling. I generally reply in a way that is essentially "here is how I think about this issue" and try to leave it to them to figure out what works for them. I even try to avoid "here is what I do" because everyone is in a different situation.
Don't trust me, look it up. https://www.irs.gov/forms-instructions-and-publications
-
- Posts: 6011
- Joined: Wed Dec 02, 2020 12:18 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I do not use social media, so I have no idea really what is pushed.alfaspider wrote: ↑Mon Jan 24, 2022 4:30 pmI've seen bogglehead-style advice on social media and shady get rick quick schemes on social media. The medium does not itself determine the message.secondopinion wrote: ↑Mon Jan 24, 2022 2:06 pmThe root problem is social media then, not age. I never use it and I seem to be better off.Rus In Urbe wrote: ↑Mon Jan 24, 2022 1:58 pm Yep. If someone asks sincerely, I point them toward some good books and this site. If they take it up and invest wisely, then great, but I can't help more than that.
Why the "younger generation" hasn't got the message----because they are getting most of their information off social media, and we all know what that means.
And then, as your stash increases and you begin to accumulate more than you need, you practice
STEALTH WEALTH
And keep your mouth shut.
Really, it's the only way to keep your sanity, as well as friendships and family dynamics clear.
Good luck.....
I am part of that "younger generation" pretty much.
I do think there's some truth to the idea that people who don't have a lot of money to invest (and don't anticipate having a lot of money any time soon) are more prone to wild risk taking. If you are in a position to put $100k into the market every year, then a 10% annual return sounds pretty good. You are going to have a million bucks in under 10 years.
If your only source of investible funds is your $2k tax return every year, it's much more tempting delude yourself into thinking the latest memestock is going to turn that into 1,000% gains, because those 10% gains are only going to look meaningful at multi-decade timescales if you aren't investing an appreciable fraction of your income. If you want that million bucks, this decade, you need outsized returns. Likewise, it's generally not the wealthy who buy lottery tickets.
Unfortunately, the ridiculous risk taking happens when little money is involved. However, some big money takes such risks as well. That is why I responsibly manage any money: it helped when it was hundreds, it helps when it is hundreds of thousands.
Boom or bust-type investment is the wrong investment vehicle for any sizable amount of any portfolio.
Passive investing: not about making big bucks but making profits. Active investing: not about beating the market but meeting goals. Speculation: not about timing the market but taking profitable risks.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
This is not really true. In certain situations, it will lead to wash sale situations!arcticpineapplecorp. wrote: ↑Mon Jan 24, 2022 3:50 pm [...]
Q: when should I buy?
A: when you have the money.
Q: when should I sell?
A: when you need the money.
You always need to have an emergency fund. And if you have one, you don't need to sell when you need the money!
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I think people need to learn to mind their own business.
-
- Posts: 6011
- Joined: Wed Dec 02, 2020 12:18 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
1. Right on the general case. I have normally avoided bubbles and it took time to even want to take major risks.DarkMatter731 wrote: ↑Mon Jan 24, 2022 4:41 pm I'm 22 so I'm probably 'young' enough to answer here.
There are a few things I'm going to address here:
1. The average young person isn't investing in meme stocks, they're not investing in stocks at all
The internet would have you think that everyone is investing in the market. Only 50% of the US population invest indirectly or directly in the market at all and only 15% of the US population directly invest in the stock market. Most Americans are not investing in tech/meme stocks and that is especially true for young people who are less likely to participate in the market than older people.
The bloodbath that you saw was because of institutional investors, not retail investors. It's the same with the GameStop 'squeeze' last year - there was a narrative in the media that retail was moving the market when this is clearly not true. Institutional investors were the ones 'pumping' up the price and selling between each other.
2. Passive management only works because investors invest in actively managed strategies or directly invest into the market
Passive management only works because of something called price discovery. Any individual or institution buying or selling shares of meme stocks or tech stocks or whatever stock that currently grates your jaw IS a good thing for the market as a whole. If a stock trade has low volume, it increases the chance of the asset being mis-priced.
If a young person wants to invest in tech stocks, this is a good thing for index investors as a whole.
3. The market isn't efficient
I think I don't need to elaborate more but the market clearly isn't efficient. I remain pretty convinced that alpha generation is possible both in public and private markets. If a young person wants to attempt to generate alpha or increase their returns through beta, why should they change their strategy? It seems patronizing to have someone tell them that what they're doing is dumb - yes, chances are, most investors can't find meaningful alpha but that doesn't mean they shouldn't try.
4. Not every investor has the same risk tolerance or aims
This links to the point above. My risk tolerance as a young guy is much different to an elderly widow for example. I've got the benefit of time on my hands that older investors probably do not. I'm running a book that would make said widow faint - yes, it probably is foolish but I'm not going to listen to other people without making my own mistakes. For example, 25% of my portfolio could be described as being 'Boglehead'-like but the rest is much more actively managed.
i) 25% of my holdings in SPY, which is the more Bogleheads portion of my portfolio.
ii) 25% of my holdings in a market neutral model I'm running
iii) 50% of my holdings in e-mini futures (the leverage on which might make someone faint but I do adjust leverage on a periodic basis)
And look, I'm not pretending that I'm not taking extraordinary risks. I'm definitely taking more risks than I should.
But as a young person, someone lecturing me wouldn't convince me about the error of my ways, it would make me run the other way.
3&4. I agree. By the time one considers every participant in the market and their duration, their reasons, their objectives, etc., I cannot believe that all investments are efficient for all investors/speculators. Each person is a participant and not the "average participant"; what the big money does might not match our needs. They might be buying art or private equity; should we? Rationality considers the optimal for one's situation; not the "average" situation.
Passive investing: not about making big bucks but making profits. Active investing: not about beating the market but meeting goals. Speculation: not about timing the market but taking profitable risks.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
My observations as someone in their mid-30s who has followed BH (quietly) for about 5 years:
1) BH philosophy has impacted the "younger generation" in a powerful way over the past decades: despite the news, most people save via a 401k and are auto-enrolled in a low-cost, index-based target date fund (TDF). You can argue all day about the TDF's AA (90/10 equities/fixed income, 60/40 US/intl, etc) are "optimal", but this vehicle beats the (high-cost) financial adviser alternative.
2) People are more concerned about saving for a house than ARKK.
3) Young retail investors have plenty of low-cost, passive products available to them they didn't decades ago; despite this, the financial services industry will continue to develop high-cost, shiny products.
4) If people are going to make financial mistakes, it's better to do so when young when the sums involved are relatively small.
1) BH philosophy has impacted the "younger generation" in a powerful way over the past decades: despite the news, most people save via a 401k and are auto-enrolled in a low-cost, index-based target date fund (TDF). You can argue all day about the TDF's AA (90/10 equities/fixed income, 60/40 US/intl, etc) are "optimal", but this vehicle beats the (high-cost) financial adviser alternative.
2) People are more concerned about saving for a house than ARKK.
3) Young retail investors have plenty of low-cost, passive products available to them they didn't decades ago; despite this, the financial services industry will continue to develop high-cost, shiny products.
4) If people are going to make financial mistakes, it's better to do so when young when the sums involved are relatively small.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I agree that this isn't a blood bath. S&P is what it was a few months ago. If it drops to 3000 or below and we see capitulation, that'd be more interesting. Trading floors shut down to let things cool and mass institutional sell off like we did in in 2020, I'd be more inclined to call this a blood bath. For younger folks, hopefully, will be a relatively cheaper lesson in greed/FOMO, rather than later in life when a heftier price may be required. Can always give them a copy of if you can by Bernstein. People aren't going to listen, unless they're ready. Between crypto/NFT/memestocks, no point in trying.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I'm ~35, and hardly anyone I know from 50-90 even knows what an index fund even is. Most of the ones who are retired have very little clue to where their money actually is and what fees they're paying. However, this says more about the people I know in this range than anything else.
It's not hard to imagine an opposite post on a younger venue on the topic. Doubtless people could chime in and feel a sense of superiority of the valuable lessons people 20-40 know that older people are just too stubborn and set in their ways to learn. But other than making a few posters feel better about themselves, there would be no point or basis.
There is no data in this post to suggest whether older or younger investors are more likely to follow a BH approach. It is based on speculation.
It's not hard to imagine an opposite post on a younger venue on the topic. Doubtless people could chime in and feel a sense of superiority of the valuable lessons people 20-40 know that older people are just too stubborn and set in their ways to learn. But other than making a few posters feel better about themselves, there would be no point or basis.
There is no data in this post to suggest whether older or younger investors are more likely to follow a BH approach. It is based on speculation.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Well, it would have been a great day to buy lowarcticpineapplecorp. wrote: ↑Mon Jan 24, 2022 3:50 pmIf she had money to invest but didn't what is she waiting for? Isn't she engaging in market timing even when not buying?UpperNwGuy wrote: ↑Mon Jan 24, 2022 3:35 pm One of my three millennial children sent me a text this morning warning me not to look at the stock market. I told her I already had. She asked if today would be a good day to buy. I told her it would be an even better day to sit back and just watch. She thanked me a few minutes ago after the market had closed quite differently from its morning antics.
Q: when should I buy?
A: when you have the money.
Q: when should I sell?
A: when you need the money.
Crom laughs at your Four Winds
- arcticpineapplecorp.
- Posts: 15080
- Joined: Tue Mar 06, 2012 8:22 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
In an ETF yes, MF, no.muffins14 wrote: ↑Mon Jan 24, 2022 6:27 pmWell, it would have been a great day to buy lowarcticpineapplecorp. wrote: ↑Mon Jan 24, 2022 3:50 pmIf she had money to invest but didn't what is she waiting for? Isn't she engaging in market timing even when not buying?UpperNwGuy wrote: ↑Mon Jan 24, 2022 3:35 pm One of my three millennial children sent me a text this morning warning me not to look at the stock market. I told her I already had. She asked if today would be a good day to buy. I told her it would be an even better day to sit back and just watch. She thanked me a few minutes ago after the market had closed quite differently from its morning antics.
Q: when should I buy?
A: when you have the money.
Q: when should I sell?
A: when you need the money.
And if you had the money to do so, rebalancing aside. My money's invested and I don't get paid again til Friday.
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions |
-
- Posts: 292
- Joined: Mon Mar 18, 2013 11:55 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
This could be only the beginning. Valuations can drop for the entire US stock market. We could have another lost decade or worse even with a BH approach.
Given these facts, I suggest humility.
I have pointed multiple people to this page:
https://www.bogleheads.org/wiki/Getting_started
I only do it when specifically asked for advice. I emphasize the evidence and rationale, the importance of sticking it out during a crash, focusing on a timeline of decades, and if you are looking for a way to get rich quick I do not have the answer.
Given these facts, I suggest humility.
I have pointed multiple people to this page:
https://www.bogleheads.org/wiki/Getting_started
I only do it when specifically asked for advice. I emphasize the evidence and rationale, the importance of sticking it out during a crash, focusing on a timeline of decades, and if you are looking for a way to get rich quick I do not have the answer.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Well, if may but determine the message...alfaspider wrote: ↑Mon Jan 24, 2022 4:30 pm I've seen bogglehead-style advice on social media and shady get rick quick schemes on social media. The medium does not itself determine the message.
But arguably it impacts how many people hear the message...
"Boring" BH style investing that doesn't feed into - or react to - the hype / news / advertising of the day, and thus isn't as "engaging" as other content.
Some (lots?) of this is likely human nature. We all want the "quick fix". Get rich quick? Lose weight quick? Have better relationships quick? Get that promotion quick?
The "slow and steady wins the race" approach of BH just isn't as exciting. Except for those who understand it works...
-
- Posts: 515
- Joined: Sun Apr 06, 2014 7:27 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
"Hodl" and "stay the course" are kinda the same thing, aren't they?
Kind of like this forum and a subreddit.
Kind of like this forum and a subreddit.
Last edited by health teacher on Mon Jan 24, 2022 8:02 pm, edited 1 time in total.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Can't tell if that was sarcasm...health teacher wrote: ↑Mon Jan 24, 2022 7:58 pm "Hodl" and "stay the course" are kinda the same thing, aren't they?
-
- Posts: 515
- Joined: Sun Apr 06, 2014 7:27 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
It's not. Think about it. A boglehead "stays the course" during ups and downs because he/she believes in a system.SnowBog wrote: ↑Mon Jan 24, 2022 8:01 pmCan't tell if that was sarcasm...health teacher wrote: ↑Mon Jan 24, 2022 7:58 pm "Hodl" and "stay the course" are kinda the same thing, aren't they?
The "younger generation" (which is such an ignorant perspective) hodls because he or she believes in a system. You don't think those crypto/ meme stocks don't have "wikis" just like this site does?
Isn't being down 7% the past month a bloodbath for a conservative investor? I don't see the big difference. Institutions/governments wouldn't be spending billions if this stuff didn't have some merit worth exploring.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I guess if you divorce "stay the course" from everything else that's supposed to go with it - including "tune out the noise" - you could make the abstract argument you made... And in that abstract sense - connect hodl to "stay the course" - and at the same time someone who continues to let their money ride at the casino as that's "their system"...health teacher wrote: ↑Mon Jan 24, 2022 8:12 pmIt's not. Think about it. A boglehead "stays the course" during ups and downs because he/she believes in a system.SnowBog wrote: ↑Mon Jan 24, 2022 8:01 pmCan't tell if that was sarcasm...health teacher wrote: ↑Mon Jan 24, 2022 7:58 pm "Hodl" and "stay the course" are kinda the same thing, aren't they?
The "younger generation" (which is such an ignorant perspective) hodls because he or she believes in a system. You don't think those crypto/ meme stocks don't have "wikis" just like this site does?
Isn't being down 7% the past month a bloodbath for a conservative investor? I don't see the big difference. Institutions/governments wouldn't be spending billions if this stuff didn't have some merit worth exploring.
But IMHO, "stay the course" is one of the last steps of a broad set of principles https://www.bogleheads.org/wiki/Boglehe ... philosophy
These include other ones that apply first, such as:
- Develop a workable plan
- Never bear too much or too little
- Diversify
- Never try to time the market
But my impression of hodl is in part trying to get others to continue holding (aka "greater fool") to in theory continue creating pressure and/or believing "too the moon" - that there's only a single direction things will go. I also don't get the sense that they are broadly diversified - as (and again, my view may be biased/incorrect) it seems like there is a distinct favoring of "concentration" in making a few "strategic bets" for these folks.
By contrast, my impression of those following BH/"stay the course" are broadly diversified, recognize that companies/stocks "come and go" - which is why they hold the market and advise avoiding concentration risk (aka don't invest in individual stocks), and understand that cycles can bring good and bad returns - often in quick succession.
And moreover, "stay the course" represents that they know their "plan" is going to work out - even if the intermediary journey isn't known. To me, "hodl" means that there's going to be a lot of disappointed people (and likely a few very rich ones). Fad stocks are not new...
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Gee. That sure sounds familiar.
A lot of people don't seem to quite get one or two of those things, from what I've seen. Also, averages.By contrast, my impression of those following BH/"stay the course" are broadly diversified, recognize that companies/stocks "come and go" - which is why they hold the market and advise avoiding concentration risk (aka don't invest in individual stocks), and understand that cycles can bring good and bad returns - often in quick succession.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
HODL is about...SnowBog wrote: ↑Mon Jan 24, 2022 9:03 pm
But my impression of hodl is in part trying to get others to continue holding (aka "greater fool") to in theory continue creating pressure and/or believing "too the moon" - that there's only a single direction things will go. I also don't get the sense that they are broadly diversified - as (and again, my view may be biased/incorrect) it seems like there is a distinct favoring of "concentration" in making a few "strategic bets" for these folks.
- Recognizing there will be volatility
- Resigning yourself not to try to beat the market, and not to trust your emotions or trading abilities
- Recognizing that it is simply better to accept the long term return of an asset than timing entries and exits
I dare say the core tenants line up with the BH philosophy quite nicely?
Whether most BH's would like the comparison is a separate issue.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I'll accept the timing/emotions/volatility similarities...ckangas wrote: ↑Mon Jan 24, 2022 10:03 pmHODL is about...SnowBog wrote: ↑Mon Jan 24, 2022 9:03 pm
But my impression of hodl is in part trying to get others to continue holding (aka "greater fool") to in theory continue creating pressure and/or believing "too the moon" - that there's only a single direction things will go. I also don't get the sense that they are broadly diversified - as (and again, my view may be biased/incorrect) it seems like there is a distinct favoring of "concentration" in making a few "strategic bets" for these folks.
- Recognizing there will be volatility
- Resigning yourself not to try to beat the market, and not to trust your emotions or trading abilities
- Recognizing that it is simply better to accept the long term return of an asset than timing entries and exits
I dare say the core tenants line up with the BH philosophy quite nicely?
Whether most BH's would like the comparison is a separate issue.
Admittedly, I've only seen HODL referenced in context to so-called meme stocks like GME...
But "accepting long-term return" and/or "not trying to beat the market" seem the opposite of [my admittedly limited] understanding of HODL.
What am I missing?
-
- Posts: 553
- Joined: Mon Jun 21, 2021 11:38 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I don’t know about the OP’s thesis. It seems to me like the market (or perhaps more accurately the Fed) since ‘08 has rewarded taking on risk beyond what your average BH investor probably did. On the whole it might be the supposedly “young and dumb” that have captured much of the benefit of additional risk taking during this run, at least in proportion to investable assets. I know I feel like a dope for being thrifty and investing conservatively, when I clearly should have just leveraged QQQ and bought the most expensive house I could afford. I don’t mean to be woe is me, but I’m not exactly woe is them yet either.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
This. THIS! This and this and this. Keep your mouth shut. Do not do not do not share how you are doing with family. They don't want to hear how, all they want is to know how much and can I have some. Even if they don't, no good comes from someone knowing about your stash. Shut your mouth. Pay your bills. Fly under the radar.Rus In Urbe wrote: ↑Mon Jan 24, 2022 1:58 pm And then, as your stash increases and you begin to accumulate more than you need, you practice
STEALTH WEALTH
And keep your mouth shut.
Really, it's the only way to keep your sanity, as well as friendships and family dynamics clear.
I have tried very hard to help and it comes across as gloating or culty or judgey. I no longer try at all. My kids know. My wife and I talk about it a lot. No one else. Ever again.
Nescio
-
- Posts: 8
- Joined: Sat Jan 15, 2022 12:12 pm
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I share the If You Can pdf with as many young people as I can irl (mostly nieces and nephews). I also share the story about Bob, the market timer and the Bogleheads website in the Reddit investing subs to which I subscribe. Or at least the ones where I know folks may take to it. I get called boomer a lot, but I’ve been called worse.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I enjoy discussing personal finance and do it frequently with friends and colleagues, especially those younger than myself. I think I've helped some which is gratifying. Sure, much of it has fallen on deaf ears but that's fine too.
I've never anyone "blame me"in person for financial advice. I'm surprised by how many people in this thread have evidently had that happen and have a strong aversion to offering financial advice. In fact, the only negative feedback I've received for advice offered has been right here on Bogleheads but that hasn't stopped me or many others here...
I've never anyone "blame me"in person for financial advice. I'm surprised by how many people in this thread have evidently had that happen and have a strong aversion to offering financial advice. In fact, the only negative feedback I've received for advice offered has been right here on Bogleheads but that hasn't stopped me or many others here...
- Mel Lindauer
- Moderator
- Posts: 35782
- Joined: Mon Feb 19, 2007 7:49 pm
- Location: Daytona Beach Shores, Florida
- Contact:
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I've observed that just as older investors fall into a number of categories, younger investors can't be lumped into a single group either.
At one time, I was a guest lecturer in a college finance class, taught by a PhD in Finance who just happened to be using our first Bogleheads book as the class text book. Small world.
I chose to speak to the class about 401k plans, because I felt that it was important for them to understand what it was and how it works, since that's what they'd face when they get their first "real" job and HR hands them the Employee Handbook and asks them if they want to contribute. I also emphasized how important it is to start early and let the power of compounding work for them.
Since it was a senior class, they were probably in their early 20s, just what we're talking about in this thread. Here's what I observed as I spoke to them:
1. Some seemed bored and couldn't wait for the class to be over. They just needed the credit to graduate.
2. A couple actually laid their head down on their desk and napped.
3. However, the majority seemed very interested and alert, and a number of them actually came up and chatted with me after the class was over, asking relevant questions and having me sign their book.
So, my observation is that you have diversity in younger folks when it comes to being interested in investing just as you do with older investors.
At one time, I was a guest lecturer in a college finance class, taught by a PhD in Finance who just happened to be using our first Bogleheads book as the class text book. Small world.
I chose to speak to the class about 401k plans, because I felt that it was important for them to understand what it was and how it works, since that's what they'd face when they get their first "real" job and HR hands them the Employee Handbook and asks them if they want to contribute. I also emphasized how important it is to start early and let the power of compounding work for them.
Since it was a senior class, they were probably in their early 20s, just what we're talking about in this thread. Here's what I observed as I spoke to them:
1. Some seemed bored and couldn't wait for the class to be over. They just needed the credit to graduate.
2. A couple actually laid their head down on their desk and napped.
3. However, the majority seemed very interested and alert, and a number of them actually came up and chatted with me after the class was over, asking relevant questions and having me sign their book.
So, my observation is that you have diversity in younger folks when it comes to being interested in investing just as you do with older investors.
Best Regards - Mel |
|
Semper Fi
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
+1
And you'll find "leaders", "followers", and "others" in every demographic as well.
In just looking at my small circle of neices, nephews, friends kids, co-workers, etc. in their 20`s: some have it together, some are working to get there, some have no clue and are OK with that, others have no clue (including about having no clue).
I remember similar for my peer group.
And you'll find "leaders", "followers", and "others" in every demographic as well.
In just looking at my small circle of neices, nephews, friends kids, co-workers, etc. in their 20`s: some have it together, some are working to get there, some have no clue and are OK with that, others have no clue (including about having no clue).
I remember similar for my peer group.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I am 26. Am I young to talk?
Half of my peers are more into individual stocks as well as the asset that cannot be name here. The other half of my peers don't even invest in any asset.
I don't know how I come about here but I was also into individual stock until I realise that I cannot continue my life like this. I decided to post in various local forum for some guidance. Long story short, I continue researched with the guidance given and landed in boglehead. Although, I do hold some different views with the comments here.
I think sharing a simple 3 fund portfolio and asking the person to research on their own will be enough.
Half of my peers are more into individual stocks as well as the asset that cannot be name here. The other half of my peers don't even invest in any asset.
I don't know how I come about here but I was also into individual stock until I realise that I cannot continue my life like this. I decided to post in various local forum for some guidance. Long story short, I continue researched with the guidance given and landed in boglehead. Although, I do hold some different views with the comments here.
I think sharing a simple 3 fund portfolio and asking the person to research on their own will be enough.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Even Vanguard says the Boglehead approach will FAIL. Like it did from 1999-2009.
"As we look toward 2022 and beyond, our long-term outlook for assets is guarded...."
https://institutional.vanguard.com/iam/ ... 122021.pdf
The word "assets" refers to EVERYTHING in the world.
Vanguard even says a lot of bonds are overpriced.
"As we look toward 2022 and beyond, our long-term outlook for assets is guarded...."
https://institutional.vanguard.com/iam/ ... 122021.pdf
The word "assets" refers to EVERYTHING in the world.
Vanguard even says a lot of bonds are overpriced.
-
- Posts: 49020
- Joined: Fri May 11, 2007 11:07 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Your concern is very genuine, and felt.Orangutan wrote: ↑Mon Jan 24, 2022 12:08 pm There has been an obvious reset of bloated valuations in speculative tech stocks, meme stocks, and digital currency. Many tech stocks are down over 70%, Peloton is down nearly 90%, rate hikes in play, persistent inflation, yada yada.
This has bothered me more than I thought it may. I don't have data, but I assume this has disproportionately affected younger investors, less financially educated investors, and investors of lower socioeconomic status.
I went on a tinder date last summer. As I worryingly glanced at the drink prices in Tribeca, she mentioned she was 100% invested in ARKK. Another friend heavily invested in Palantir Technologies and that gold coin. I myself, even got caught up and briefly held Roku. I have many stories like this of friends in my twenties.
What can be done? It seems like you have to go looking for Bogleheads knowledge, read the correct few books out of thousands, and avoid getting caught up in the mania. I posted a similar question months ago "Why aren't there more Bogleheads in the wild?", but this is more actionable and asking how to broadly reach the younger generation.
It was cool to have the "insider knowledge" of Bogleheads and just go through Nisiprius's posts when in doubt. But now, it sort of makes my stomach hurt to think of so many others who got hurt by the recent mania. It's sort of like getting into an elite company or college. Those who know, know. Most everyone else does not know the specific "secrets" to do this (trying not to breach any forum rules here). It's meritocratic, of course. But is it really? Of course, my assumption that people don't have readily accessible investing knowledge may be wrong.
Stock portfolios on tinder dates. You make me glad dating is (hopefully) well in my past (I did meet my spouse on the internet, before internet dating was a "thing" - my parents were appalled that we even considered telling people about it).
One can only give people the benefit of one's advice.
The trick with the "wisdom of the elders" is to consume it all, then process it, decide what is worthwhile and what is to be discarded.
-
- Posts: 49020
- Joined: Fri May 11, 2007 11:07 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Never tell anyone how well you are doing with your investments. Ever.bampf wrote: ↑Mon Jan 24, 2022 10:49 pmThis. THIS! This and this and this. Keep your mouth shut. Do not do not do not share how you are doing with family. They don't want to hear how, all they want is to know how much and can I have some. Even if they don't, no good comes from someone knowing about your stash. Shut your mouth. Pay your bills. Fly under the radar.Rus In Urbe wrote: ↑Mon Jan 24, 2022 1:58 pm And then, as your stash increases and you begin to accumulate more than you need, you practice
STEALTH WEALTH
And keep your mouth shut.
Really, it's the only way to keep your sanity, as well as friendships and family dynamics clear.
I have tried very hard to help and it comes across as gloating or culty or judgey. I no longer try at all. My kids know. My wife and I talk about it a lot. No one else. Ever again.
Cultivate a series of anecdotes about "ones that got away" or "the time I lost out, big". Always understate what you have and what you are doing.
Smart people will work out that you are dissembling.
-
- Posts: 49020
- Joined: Fri May 11, 2007 11:07 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Seen the performance of the NASDAQ of late? I wouldn't want to have been leveraged in that.Joey Jo Jo Jr wrote: ↑Mon Jan 24, 2022 10:41 pm I don’t know about the OP’s thesis. It seems to me like the market (or perhaps more accurately the Fed) since ‘08 has rewarded taking on risk beyond what your average BH investor probably did. On the whole it might be the supposedly “young and dumb” that have captured much of the benefit of additional risk taking during this run, at least in proportion to investable assets. I know I feel like a dope for being thrifty and investing conservatively, when I clearly should have just leveraged QQQ and bought the most expensive house I could afford. I don’t mean to be woe is me, but I’m not exactly woe is them yet either.
Owning Apple was a smart thing to do. You could have ignored Bogleheads and constructed a portfolio of the internet winners - the FAANGs+ Microsoft - and done very well. (And Tesla, but I really struggle to explain the valuation of that one whereas with the others, you can see it in the sales & the earnings, the underlying growth).
Leveraged bets on a volatile underlying asset? Not so much. The downsweeps cause more harm than you can make back, from what I have read.
Note that leveraged QQQ (or S&P 500 etc) won't behave in the long run like the underlying. Structure of the product.
What you really mean is use LEAPs? (long dated calls on S&P 500). See Zvi Bodie's book. There is a case - in a portfolio which is 90% TIPS bonds (or iBonds). But that's not what you meant.
-
- Posts: 49020
- Joined: Fri May 11, 2007 11:07 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
It has felt for some time like we are in a late 1960s environment. Nothing looks attractively valued.Booogle wrote: ↑Tue Jan 25, 2022 5:26 am Even Vanguard says the Boglehead approach will FAIL. Like it did from 1999-2009.
"As we look toward 2022 and beyond, our long-term outlook for assets is guarded...."
https://institutional.vanguard.com/iam/ ... 122021.pdf
The word "assets" refers to EVERYTHING in the world.
Vanguard even says a lot of bonds are overpriced.
But the future is never like the past.
Market will start to rally when Kiev is about to fall, I reckon ...
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I'm teaching my own kid the principles of investing, but that's as far as I'll go. The one thing I've noticed is that most people don't have the stomach for the inevitable drops in share prices. You don't really learn how to live with the ups and downs unless you go through a really bad period/recovery, IMO. I know a lot of older people too who don't invest at all. They may have an annuity or some bonds, but that's it.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I think people should lower the notion about psychology problem or unable to tolerate large drop. It is pretty oversold especially for young people with created terms such as hodl and diamond hands. No, not alot common people sit behind the desk and panic sell. I don't know why people kept bringing up on that. Even if they do, retail investors really do not influence anything.
Its one of the few things I had a pet peeve with boglehead community. They do some strange parroting for certain things.
Its one of the few things I had a pet peeve with boglehead community. They do some strange parroting for certain things.
-
- Posts: 3944
- Joined: Fri Dec 20, 2019 2:49 am
- Location: Upstate NY
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
Before there can be a teacher there has to be a student.
-
- Posts: 515
- Joined: Sun Apr 06, 2014 7:27 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
This is spot on. Interest/attention is paramount in learning theory. Beyond that, if the learners don't trust the so called "teacher" in whatever scenario, you can just about forget it.Mel Lindauer wrote: ↑Tue Jan 25, 2022 1:06 am So, my observation is that you have diversity in younger folks when it comes to being interested in investing just as you do with older investors.
I think anyone who is trying educate someone on investing should take the boglehead, slow and steady, passive approach. Interest in frugality is what brought me to this site however many years ago. I stumbled upon it somehow and started reading and reading the personal consumer issues forum. Learned a ton, but it literally took years. I saw the investing stuff and read it, but it didn't really resonate with me. I invested what I could the boglehead way in addition to my work related investments and carried on.
Then GME came into play and I invested a small chunk of my money into it. I had some skin in the game and I became incredibly interested in investing. So, now instead of Personal Consumer Finance I spend my time reading more and more of the theory, etc. I'm learning through experience (which happens to be what I believe is best practice in education, "interesting experiences").
Long story short, diversity is everywhere and alot of things in life are vastly different; however, full of similarities. To me, whether it's investing in meme stocks, crypto, SPY, total market or learning something new you have to be vigilant. At the end of the day, to me, hodl and stay the course really just mean, "do your research and be patient."
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
-
- Posts: 15368
- Joined: Fri Dec 31, 2010 8:53 am
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
I do my parents, in-laws, and younger sister's taxes and have helped them clean up their (tiny) portfolios. I have also emailed a PDF of "If you Can" to younger employees and offered to help them set up the 401k. That's about as far as I'll go. I have a few friends who I'll talk investing with (two of whom are financial advisors and another who is an investment banker), but we're just shooting the breeze and nobody is giving anybody advice. Getting money involved is the quickest way to sour any sort of relationship, even if it is just advice.Dottie57 wrote: ↑Tue Jan 25, 2022 10:11 am+1
The only person I might try to persuade because i love him. He’s not good at investing, however he has qualities I wish I had in my own personality. I no longer try to help friends.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
It might be fun to take a step back and acknowledge the egocentric view we have about our shared investing philosophy here. We may be a bit too confident or self-righteous.
There are plenty of quotes tossed around here about complexity vs simplicity. Young people with their young brains have a natural predilection to complex portfolios. Some of them search out the wisdom of their elders and some do not. Maybe complexity will work for awhile, but we believe in "reversion to the mean."
There are plenty of quotes about "this time being different" and some of the young people naturally believe this. They may or may not be correct.
I struggle with the concepts of sins of commission vs sins of omission, lies of commission vs lies of omission, continuations of misrepresentations, exclusionary detailing, and "playing dumb." I also wish to advocate for the "little guy" class of investor. This also is difficult to bear when family or parents are involved and their decisions may affect your future quality of life as a care-taker or support system. It is hard to stay silent. I often feel what seems to be a moral or ethical obligation or guilt-trip to speak up about investing. I suppose this is also egocentric.
My advice is to try to read the situation and be humble, meek, and mild while speaking.
There are plenty of quotes tossed around here about complexity vs simplicity. Young people with their young brains have a natural predilection to complex portfolios. Some of them search out the wisdom of their elders and some do not. Maybe complexity will work for awhile, but we believe in "reversion to the mean."
There are plenty of quotes about "this time being different" and some of the young people naturally believe this. They may or may not be correct.
I struggle with the concepts of sins of commission vs sins of omission, lies of commission vs lies of omission, continuations of misrepresentations, exclusionary detailing, and "playing dumb." I also wish to advocate for the "little guy" class of investor. This also is difficult to bear when family or parents are involved and their decisions may affect your future quality of life as a care-taker or support system. It is hard to stay silent. I often feel what seems to be a moral or ethical obligation or guilt-trip to speak up about investing. I suppose this is also egocentric.
My advice is to try to read the situation and be humble, meek, and mild while speaking.
Re: In light of the tech/meme bloodbath, how can Bogleheadian knowledge better reach the younger generation?
You can lead a horse to Evanescence but you can't bring it to life. You can't convince people that they can do really well with a simplified portfolio. They have to get there on their own. Don't panic at the wrong disco (bark up the wrong tree), people arrive. You can help but, they have to take the drink.Brofessor wrote: ↑Tue Jan 25, 2022 12:09 pm It might be fun to take a step back and acknowledge the egocentric view we have about our shared investing philosophy here. We may be a bit too confident or self-righteous.
There are plenty of quotes tossed around here about complexity vs simplicity. Young people with their young brains have a natural predilection to complex portfolios. Some of them search out the wisdom of their elders and some do not. Maybe complexity will work for awhile, but we believe in "reversion to the mean."
There are plenty of quotes about "this time being different" and some of the young people naturally believe this. They may or may not be correct.
I struggle with the concepts of sins of commission vs sins of omission, lies of commission vs lies of omission, continuations of misrepresentations, exclusionary detailing, and "playing dumb." I also wish to advocate for the "little guy" class of investor. This also is difficult to bear when family or parents are involved and their decisions may affect your future quality of life as a care-taker or support system. It is hard to stay silent. I often feel what seems to be a moral or ethical obligation or guilt-trip to speak up about investing. I suppose this is also egocentric.
My advice is to try to read the situation and be humble, meek, and mild while speaking.
With apologies to both rock groups.
--Bampf
Nescio