2020 was a great year for individual stock pickers

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climbingFool
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2020 was a great year for individual stock pickers

Post by climbingFool »

I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
In my own case I got many years of typical returns in one year from individual stocks and the value of my individual stocks now exceeds that of my 401k/converted to Roth.
I legally maxed out my 401k for almost my entire career and always had it in diversified index funds 100 % stock. I have no plans to touch that.
I realize the market is highly valued but I would have to incur some huge losses upcoming to not overall be ahead substantially from this year.
Retired, 61, and still very aggressive as I have been my entire life.
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Re: 2020 was a great year for individual stock pickers

Post by 000 »

Congrats!

But how do you know it was great year for other individual stock pickers?
Pandemic Bangs
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Re: 2020 was a great year for individual stock pickers

Post by Pandemic Bangs »

climbingFool wrote: Sun Jan 10, 2021 2:25 am I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
I don't think this is news to anyone on this forum. Many of us started out picking individual stocks in environments like this and feeling like geniuses.
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Re: 2020 was a great year for individual stock pickers

Post by Doctor Rhythm »

Many people come out ahead when gambling in Las Vegas in 2020. I predict that an even greater number of Las Vegas gamblers will come out ahead in 2021 than in 2020, but it depends on the pandemic.
nycbudgetq
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Re: 2020 was a great year for individual stock pickers

Post by nycbudgetq »

What could you have picked that would have done badly in 2020? You could have timed poorly by selling in March, but basically rebuying on any day after you would have still had serious gains.
theplayer11
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Re: 2020 was a great year for individual stock pickers

Post by theplayer11 »

how do you know what others picked for stocks? sorry, your posts doesn't make much sense....also not actionable.
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Kenkat
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Re: 2020 was a great year for individual stock pickers

Post by Kenkat »

Was it a great year for individual stock picking or did you just pick one stock - Tesla perhaps? - that drove all of your returns? Having done a bit of this myself in the past, it is easy to feel successful when, in fact, you may have just made a single pick that carried all of the other losers. Been there, done that myself.
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Re: 2020 was a great year for individual stock pickers

Post by megabad »

I would tweak your statement and say it was a great year for Momentum and Growth. I would also remind you that Value was the factor everyone loved only a short time ago...
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Re: 2020 was a great year for individual stock pickers

Post by 60B4E24B »

Kenkat wrote: Sun Jan 10, 2021 2:02 pm Was it a great year for individual stock picking or did you just pick one stock - Tesla perhaps? - that drove all of your returns? Having done a bit of this myself in the past, it is easy to feel successful when, in fact, you may have just made a single pick that carried all of the other losers. Been there, done that myself.
That's fine, right? No one expects to bat 1.000.
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Re: 2020 was a great year for individual stock pickers

Post by houseofnine »

Pandemic Bangs wrote: Sun Jan 10, 2021 2:48 am
climbingFool wrote: Sun Jan 10, 2021 2:25 am I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
I don't think this is news to anyone on this forum. Many of us started out picking individual stocks in environments like this and feeling like geniuses.
Well, this is a very sobering comment. :beer And while I do have some individual stocks in my portfolio, I also realize that I would have needed to make some very unlucky picks to do poorly this past year.
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Re: 2020 was a great year for individual stock pickers

Post by willthrill81 »

If anyone thinks that indexing will always beat everyone who picks individual stocks, they are very clearly wrong. But that doesn't mean that individual stock picking is a wise choice. The odds are against it.
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Re: 2020 was a great year for individual stock pickers

Post by Wanderingwheelz »

climbingFool wrote: Sun Jan 10, 2021 2:25 am I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
In my own case I got many years of typical returns in one year from individual stocks and the value of my individual stocks now exceeds that of my 401k/converted to Roth.
I legally maxed out my 401k for almost my entire career and always had it in diversified index funds 100 % stock. I have no plans to touch that.
I realize the market is highly valued but I would have to incur some huge losses upcoming to not overall be ahead substantially from this year.
Retired, 61, and still very aggressive as I have been my entire life.
Everyone is an incredible stock picker when name-brand large cap growth stocks outperform. Truth is, though, many of those people still lagged the S&P 500.
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arcticpineapplecorp.
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Re: 2020 was a great year for individual stock pickers

Post by arcticpineapplecorp. »

two sides of every trade.

for every winner, there has to be a loser.

zero sum game.
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
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Re: 2020 was a great year for individual stock pickers

Post by pasadena »

uh, ok?

Also, probably not *all* stock pickers.
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Re: 2020 was a great year for individual stock pickers

Post by Samosa22 »

Kenkat wrote: Sun Jan 10, 2021 2:02 pm Was it a great year for individual stock picking or did you just pick one stock - Tesla perhaps? - that drove all of your returns? Having done a bit of this myself in the past, it is easy to feel successful when, in fact, you may have just made a single pick that carried all of the other losers. Been there, done that myself.
I can definitely relate to that. Last year I picked 7-8 individual stocks and only one of them turned out to be a winner. The good thing is the winner has erased the losses and then some (but all unrealized gains so far).
Diversification is protection against ignorance - WB.
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Re: 2020 was a great year for individual stock pickers

Post by flyingaway »

Yes. If you picked the right stocks.
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Re: 2020 was a great year for individual stock pickers

Post by Affable at 50 »

“Owning the stock market over the long term is a winners game but attempting to beat the market is a losers game.” - John C. Bogle

I’ll take the simple path and stay the course.
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Re: 2020 was a great year for individual stock pickers

Post by Affable at 50 »

flyingaway wrote: Sun Jan 10, 2021 10:56 pm Yes. If you picked the right stocks.
“Before costs, beating the market is a zero sum game. After costs it is a losers game.” John C. Bogle

As Flyingaway suggested, many active investors/speculators did not pick the right stocks.
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Re: 2020 was a great year for individual stock pickers

Post by grabiner »

climbingFool wrote: Sun Jan 10, 2021 2:25 am I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
In every year, half of all stock pickers will do better than average. (Actually, it's a bit less than half for non-diversified picking, because distributions are skewed; a stock cannot lose more than 100% of its value, but it can gain 300%.) Average is the market return.
In my own case I got many years of typical returns in one year from individual stocks
And this shows that you have the wrong benchmark. If you just held the S&P 500 index, you got two years of typical returns (8% annualized is typical) in 2020, and four years of typical returns in 2019. (And you lost five years of typical returns in March 2020, but recovered that and then some over the following nine months.)
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climbingFool
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Re: 2020 was a great year for individual stock pickers

Post by climbingFool »

Hello
Checking back in
As I suspected much negativity about individual stock picking. I just wanted to bring another viewpoint. I consistently see much negativity about individual stock picking on this forum when I do check in.
First - how do I know it was a great year for others? I listen to a lot of financial podcasts for one and many people are saying it was the best year they ever had - as it was for me. Others I know personally also had a great year.
I've been doing individual stocks for a long time - since the 90's. But I put in much less money into it than I did with my 401k/converted to Roth and yet the individual stocks accounts values added up is more.
It also adds another hobby in retirement.
I do own a little bit of Tesla and am up big on a % basis of course but I couldn't bring myself to add to that winner as I usually do. It is probably my most overvalued stock.
I actually own well over a 100 stocks.
I personally don't think you should invest in individual stocks unless you are aggressive. You are already taking more risk with fewer stocks - you might as well have the potential for reward. If you are risk averse perhaps you should stick with index funds.
I have mentioned before it is somewhat of a game for me - one that pays off.
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Re: 2020 was a great year for individual stock pickers

Post by muffins14 »

climbingFool wrote: Tue Jan 12, 2021 1:41 am
First - how do I know it was a great year for others? I listen to a lot of financial podcasts for one and many people are saying it was the best year they ever had - as it was for me. Others I know personally also had a great year.
This is called selection bias. People who did not pick the right stocks are not bragging about it on podcasts
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Re: 2020 was a great year for individual stock pickers

Post by dogagility »

climbingFool wrote: Tue Jan 12, 2021 1:41 am I have mentioned before it is somewhat of a game for me - one that pays off.
You should really consult or open up an advisory service in your retirement. With such stock picking prowess as you possess, that's where the big money is. You need to be charging hefty fees to others. :moneybag
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Re: 2020 was a great year for individual stock pickers

Post by dboeger1 »

climbingFool wrote: Tue Jan 12, 2021 1:41 am First - how do I know it was a great year for others? I listen to a lot of financial podcasts for one and many people are saying it was the best year they ever had - as it was for me. Others I know personally also had a great year.
You're missing an important but nuanced point about stock picking that is a major part of the basis for index investing. It is a zero-sum game. There are 2 sides to every trade, the buyer and seller. Every single time you and your successful friends/acquaintances bought something that went up, the seller missed out on those returns, presumably because they either needed the money right away or no longer wanted to assume the risk of owning those shares. Had they gone down in value after you bought the shares, the seller would have been the winner and you would have been left holding the bag.

Note that stock pickers can, on average, get positive returns in an appreciating market, yet still underperform the market on average. In other words, just because the average stock picker makes money in any given year doesn't mean the average stock picker did well relative to a total market index that year. In fact, they simply cannot. In other words, the positive gains that the average stock picker achieved were due to the market going up, not the average stock picking strategy. The average diner at a restaurant may eat a lot of food, but it cannot be that on average, diners eat more than the average amount of food, because, well, by definition, they ate the average amount on average. Across the total market, there can be no net advantage to stock picking over index investing.

Well, it's almost mathematically impossible. On average, all market participants will achieve the same returns as the total market... MINUS COSTS. Generally and historically speaking, index funds minimized costs more than active strategies could. Even if you consider the new trend of zero-fee trades, active trading tax drag outside of tax-advantaged accounts almost certainly outweighs typical index fee expense ratios. That leaves the only possible way that stock picking can beat index investing on average, which is in a tax-advantaged account with absolutely no costs, hidden or otherwise (keep in mind that trade routing/prioritization, data privacy, advertisements, etc. have raised eyebrows on some of these newer zero-fee platforms, but let's ignore those for now). Assuming enough stock pickers avoid all costs, then yes, in theory, they could on average end up with lower costs than a typical index fund expense ratio. However, with today's top funds, the costs are already approaching negligible levels, to the point that many investors consider them the price for simple, dependable, portable investments. Many (probably the vast majority) retail investors lack the funds necessary to properly implement precise strategies without fractional shares, so the practicality of this is limited to a select few trendy new trading platforms, which have yet to stand the test of time.

All that is to say that the replies you considered negativity are actually more just matter of fact than anything else. Up until very recently, it was mathematically impossible for stock pickers to beat the total market indexes on average, and today, it's only even theoretically possible because of the quirks of newer trading platforms, and in practice, is unlikely to lend any real degree of credibility to the notion that stock pickers can, on average, have a "good year" relative to the markets. Simply put, stock pickers on average had a good year because the market had a good year, and any stock picks that were successful this year by definition must have someone on the other side of the trade who missed out.
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Re: 2020 was a great year for individual stock pickers

Post by JoeRetire »

climbingFool wrote: Sun Jan 10, 2021 2:25 am But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
And it was a devastating year for many of those who do pick individual stocks. You should at least be aware of that.
In my own case I got many years of typical returns in one year from individual stocks and the value of my individual stocks now exceeds that of my 401k/converted to Roth.
That's nice. The headline of this thread should probably be changed to "I had a nice 2020 picking individual stocks", rather than the generalized statement you actually wrote.
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Re: 2020 was a great year for individual stock pickers

Post by Shallowpockets »

arcticpineapplecorp. wrote: Sun Jan 10, 2021 10:03 pm two sides of every trade.

for every winner, there has to be a loser.

zero sum game.
Not so. If I sell X stock at a profit, why would the buyer be a loser? Perhaps it went up after the buy and they then sold it. And so on.
If you buy are you on the losing side? If you sell are you on the losing side?
And vice versa.
Zero sum sounds like a mantra to rationalize why you don’t do such things.
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Re: 2020 was a great year for individual stock pickers

Post by simplesimon »

Shallowpockets wrote: Tue Jan 12, 2021 8:24 am
arcticpineapplecorp. wrote: Sun Jan 10, 2021 10:03 pm two sides of every trade.

for every winner, there has to be a loser.

zero sum game.
Not so. If I sell X stock at a profit, why would the buyer be a loser? Perhaps it went up after the buy and they then sold it. And so on.
If you buy are you on the losing side? If you sell are you on the losing side?
And vice versa.
Zero sum sounds like a mantra to rationalize why you don’t do such things.
It just means that every trade contributes to the average...not that the average can't be a 10% growth per year and that the pie doesn't get bigger.

The question is are you getting average, above average, or below average returns? Presumably one picks individual stocks to be above average. Mathematically it is impossible for everyone to be above average.
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Re: 2020 was a great year for individual stock pickers

Post by arcticpineapplecorp. »

Shallowpockets wrote: Tue Jan 12, 2021 8:24 am
arcticpineapplecorp. wrote: Sun Jan 10, 2021 10:03 pm two sides of every trade.

for every winner, there has to be a loser.

zero sum game.
Not so. If I sell X stock at a profit, why would the buyer be a loser? Perhaps it went up after the buy and they then sold it. And so on.
If you buy are you on the losing side? If you sell are you on the losing side?
And vice versa.
Zero sum sounds like a mantra to rationalize why you don’t do such things.
seller believes the stock will not continue going up and/or will go down in the future so sells. Otherwise, why would you sell if you believed the price would go up in the future? you wouldn't. If you thought it would go up you wouldn't sell now, you'd sell in the future.

buyer believes the stock will go up, not down in the future. Otherwise why would they buy now? They wouldn't, they'd buy later when the price is lower not higher (or not buy at all).

only one will be right.

that's a zero sum game.

one thing you're right about--i don't play such games with my money.

the total market reflects the aggregate value of all stocks. Over time markets create value as some companies fall out and new ones are created but aggregate value increases over time. There is no such certainty about any particular company. Most companies have short life spans. That's not me saying it. That's Bessembinder:
Individual common stocks tend to have rather short lives. The median time that a stock is listed on the CRSP database between 1926 and 2016 is seven-and-a-half years.

source: https://poseidon01.ssrn.com/delivery.ph ... INDEX=TRUE
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
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Re: 2020 was a great year for individual stock pickers

Post by DesertDiva »

climbingFool wrote: Tue Jan 12, 2021 1:41 am ... I consistently see much negativity about individual stock picking on this forum when I do check in...
And yet here you are - on a site whose tagline reads “Investing advice inspired by John Bogle”.

:oops:
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Re: 2020 was a great year for individual stock pickers

Post by bubbly »

Every year is a great year for individual stock pickers if you know which stocks to pick :mrgreen:
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Re: 2020 was a great year for individual stock pickers

Post by Nowizard »

Certainly, the comments are as expected when responding to threads such as this one. There are some of us who generally subscribe to the Boglehead approach who still "Get the itch" to do something with discretionary funds and do so when "opportunities" arise. It may be purchasing an automobile or expensive watch that is more of an emotional than pragmatic decision, or it may be purchase of a stock or two. Guilty as charged with two stock purchases in the past year, the first time in many to hold more than one. Fortunately, or unfortunately, the resulting gains will probably lead to continuation of this when once again, I feel I know more than the market or have an itch in a non-financial area.

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Re: 2020 was a great year for individual stock pickers

Post by ljb1234 »

climbingFool wrote: Sun Jan 10, 2021 2:25 am I realize this forum does not generally advocate individual stock picking.
But you should at least be aware that 2020 was a fantastic year for many of those who do pick individual stocks.
In my own case I got many years of typical returns in one year from individual stocks and the value of my individual stocks now exceeds that of my 401k/converted to Roth.
I think it should be obvious that this is true every year.
You just need to know which ones to pick. If you can do this every year, then you have a great skill and should continue to do it.
But, don't confuse skill with a (mostly) bull market.
Even hedge fund managers couldn't beat the SP500 over a 10 year period. Yes, I know the fees are a big problem.
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Re: 2020 was a great year for individual stock pickers

Post by LadyGeek »

This thread is now in the Investing - Theory, News & General forum (general discussion).
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Re: 2020 was a great year for individual stock pickers

Post by KneePartsPro »

climbingFool wrote: Tue Jan 12, 2021 1:41 am Hello
Checking back in...
Hello ClimbingFool.

Thanks for checking back in. I, for one, value the individual stock picking perspective you have shared. That being said, I doubt my skills would replicate your experience and may have more to lose than to gain with regard to my financial independence. Nonetheless, congratulations on a fantastic year of individual stock picking.

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Re: 2020 was a great year for individual stock pickers

Post by humblecoder »

climbingFool wrote: Tue Jan 12, 2021 1:41 am Hello
Checking back in
As I suspected much negativity about individual stock picking. I just wanted to bring another viewpoint. I consistently see much negativity about individual stock picking on this forum when I do check in.
You shouldn't be surprised by this. Advocating the virtues of stock picking on BH is like extolling the virtues of pork at a vegan convention!
climbingFool wrote: Tue Jan 12, 2021 1:41 am First - how do I know it was a great year for others? I listen to a lot of financial podcasts for one and many people are saying it was the best year they ever had - as it was for me. Others I know personally also had a great year.
Somebody who did poorly when picking individual stocks is not going to brag about it publicly. Also, with the market up overall in 2020, most people are going to be in the black on average. The key metric is whether you did better relative to the overall market. Finally, they may have done well, but with added risk. They may have been able to get an equivalent return with less risk with a different strategy.
climbingFool wrote: Tue Jan 12, 2021 1:41 am I've been doing individual stocks for a long time - since the 90's. But I put in much less money into it than I did with my 401k/converted to Roth and yet the individual stocks accounts values added up is more.
It also adds another hobby in retirement.
I do own a little bit of Tesla and am up big on a % basis of course but I couldn't bring myself to add to that winner as I usually do. It is probably my most overvalued stock.
I actually own well over a 100 stocks.
Sounds like you followed the BH philosophy to a certain extent. You own well over 100 stocks, so your portfolio is pretty diverse (not as diverse as, say, the Total Market Index Fund, but still not too concentrated). It also sounds like your gains may have been buoyed by a couple of winners (i.e. TSLA) which probably offset some stocks that underperformed. You are more akin to a vegetarian at a vegan convention!
climbingFool wrote: Tue Jan 12, 2021 1:41 am I personally don't think you should invest in individual stocks unless you are aggressive. You are already taking more risk with fewer stocks - you might as well have the potential for reward. If you are risk averse perhaps you should stick with index funds.
I have mentioned before it is somewhat of a game for me - one that pays off.
Again, it sounds like you understand the BH philosophy. You agree and understand that less diversification means more risk. On the other hand, you believe that you have some innate advantage which allows you to forecast the winners and losers. So you have to ask yourself if your success is due to some advantage that you have in picking stocks versus the market, or is it just by luck that you have done better? I don't mean that in a negative way, but I ask it because it is a question that all of us BH's have asked ourselves at some point. Most come to the BH philosophy because they realize that, no, they can't pick the winners and losers. It sounds like you feel that you can. Which is fine. If that works for you, then keep on keeping on! :sharebeer
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Re: 2020 was a great year for individual stock pickers

Post by jrbdmb »

muffins14 wrote: Tue Jan 12, 2021 2:32 am
climbingFool wrote: Tue Jan 12, 2021 1:41 am
First - how do I know it was a great year for others? I listen to a lot of financial podcasts for one and many people are saying it was the best year they ever had - as it was for me. Others I know personally also had a great year.
This is called selection bias. People who did not pick the right stocks are not bragging about it on podcasts
I live near Atlantic City, and I have no idea how the casinos remain open (pandemic notwithstanding), since literally everybody who talks about their recent casino trip was a winner. :happy
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Re: 2020 was a great year for individual stock pickers

Post by Watty »

2020 was a great year for individual stock pickers
Every year is a great year for about half of all stock pickers.

Pretty much by definition the other half does worse than an index fund.
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Re: 2020 was a great year for individual stock pickers

Post by JoMoney »

Watty wrote: Tue Jan 12, 2021 11:47 am
2020 was a great year for individual stock pickers
Every year is a great year for about half of all stock pickers.

Pretty much by definition the other half does worse than an index fund.
On a dollar weighted basis this is true, on the potential for picking individual stock portfolio's it's not necessarily true (at least on a return only, not risk adjusted basis.)
For most of 2020 (the period after March) small and mid-cap stocks outperformed the S&P 500.
Half the market by dollar weight is in the top 100 stocks or so. There are more stocks by individual number on the lower half of the market.
If you randomly picked stocks from the Russell 3000 (or even the S&P 500), odds are that a random picking of stocks will have more picks in stocks smaller than the average market-cap of the broad market. So when you have a situation where small-cap stocks beat large-cap stocks it will generally favor the stock picker (or an equal weighted random assortment) over the dollar-weighted/market-cap weighted assortment.
... but again, only in a period where small beats large (on average), and only on a return basis ignoring a "risk adjusted" comparison
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Re: 2020 was a great year for individual stock pickers

Post by bligh »

I see so many similarities between today and the dotcom bubble.

The day trading. I personally have 4 people in my immediate friends circle that have taken up day trading, three of them do it full time now.

The stories in the press on newly minted bubble stock millionaires.

The complete disregard for fundamental valuations when pricing a stock. Back then the internet age had dawned and you better jump on the bandwagon or get left behind. Now it is the green age or AI age has dawned and you better jump on the bandwagon or get left behind.

Being told that you are out of touch for the new economy and getting made fun of when pointing the above out or shutting down rational conversation by discussing your massive gains over the last 6 months. ie. "You are obviously wrong, because look at how much more money I made compared to you in the market than you did". I remember when even Warren Buffet was being pressured and criticized as he sat out the dotcom years.
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Re: 2020 was a great year for individual stock pickers

Post by james22 »

climbingFool wrote: Tue Jan 12, 2021 1:41 amI actually own well over a 100 stocks.
Why so many?
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Re: 2020 was a great year for individual stock pickers

Post by AlohaBill »

Hi ,
I am retired. Most of my assets are in Vtinx ( 30/70). Our net investment increased by 132000 in the last 6 months. I picked Vtinx to pick stocks and bonds for us. Congratulations on your success.
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MinnGuyInvesting
Posts: 360
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Re: 2020 was a great year for individual stock pickers

Post by MinnGuyInvesting »

bligh wrote: Tue Jan 12, 2021 12:10 pm I see so many similarities between today and the dotcom bubble.

The day trading. I personally have 4 people in my immediate friends circle that have taken up day trading, three of them do it full time now.

The stories in the press on newly minted bubble stock millionaires.

The complete disregard for fundamental valuations when pricing a stock. Back then the internet age had dawned and you better jump on the bandwagon or get left behind. Now it is the green age or AI age has dawned and you better jump on the bandwagon or get left behind.

Being told that you are out of touch for the new economy and getting made fun of when pointing the above out or shutting down rational conversation by discussing your massive gains over the last 6 months. ie. "You are obviously wrong, because look at how much more money I made compared to you in the market than you did". I remember when even Warren Buffet was being pressured and criticized as he sat out the dotcom years.
I think a couple things are different.

1. More education / accessibility. This will continue to evolve. You couldn't trade on an app (or if you could, people weren't in 2003).

2. More investing. People are "saving / investing" more after 2009. I believe this to be 100% true.

3. Right now people are worried about the value of the $$$ diminshing, so throwing money at big companies you believe will stick around is safer than holding cash (in people's opinions).

4. If you are indexing via any major index fund, you are adding to the problem by being heavily invested in Apple, Microsoft, facebook, amazon, Alibaba, etc.

None of these three factors indicate impending doom for the stock market.
Index ETF's 41% |ARK Funds 39% | AAPL 5% | TSLA 3% | GOOGL 1% | AMZN 1% |Other stocks 5% | BTC/ETH 5% | | | Tracking my porfolio: https://www.bogleheads.org/forum/viewtopic.php?p=5745280#p5745280
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MinnGuyInvesting
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Re: 2020 was a great year for individual stock pickers

Post by MinnGuyInvesting »

Oh, and by the way, I kicked butt in choosing my own stocks.

I had $300 in Nikola and sold at a loss, but more than made up for it with heavier investments in TSLA!!! :moneybag :moneybag :moneybag :moneybag :moneybag



:sharebeer
Index ETF's 41% |ARK Funds 39% | AAPL 5% | TSLA 3% | GOOGL 1% | AMZN 1% |Other stocks 5% | BTC/ETH 5% | | | Tracking my porfolio: https://www.bogleheads.org/forum/viewtopic.php?p=5745280#p5745280
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cheese_breath
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Re: 2020 was a great year for individual stock pickers

Post by cheese_breath »

Any year is a great year for the ones who pick the right stocks.
The surest way to know the future is when it becomes the past.
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bligh
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Re: 2020 was a great year for individual stock pickers

Post by bligh »

MinnGuyInvesting wrote: Tue Jan 12, 2021 12:28 pm
bligh wrote: Tue Jan 12, 2021 12:10 pm I see so many similarities between today and the dotcom bubble.

The day trading. I personally have 4 people in my immediate friends circle that have taken up day trading, three of them do it full time now.

The stories in the press on newly minted bubble stock millionaires.

The complete disregard for fundamental valuations when pricing a stock. Back then the internet age had dawned and you better jump on the bandwagon or get left behind. Now it is the green age or AI age has dawned and you better jump on the bandwagon or get left behind.

Being told that you are out of touch for the new economy and getting made fun of when pointing the above out or shutting down rational conversation by discussing your massive gains over the last 6 months. ie. "You are obviously wrong, because look at how much more money I made compared to you in the market than you did". I remember when even Warren Buffet was being pressured and criticized as he sat out the dotcom years.
I think a couple things are different.

1. More education / accessibility. This will continue to evolve. You couldn't trade on an app (or if you could, people weren't in 2003).

2. More investing. People are "saving / investing" more after 2009. I believe this to be 100% true.

3. Right now people are worried about the value of the $$$ diminshing, so throwing money at big companies you believe will stick around is safer than holding cash (in people's opinions).

4. If you are indexing via any major index fund, you are adding to the problem by being heavily invested in Apple, Microsoft, facebook, amazon, Alibaba, etc.

None of these three factors indicate impending doom for the stock market.
Sure you can point out the many ways in which "it is different this time". They did that back in 1999 too.

“History Doesn't Repeat Itself, but It Often Rhymes” – Mark Twain.
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boglehat
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Re: 2020 was a great year for individual stock pickers

Post by boglehat »

Mathematically, for every stock picker that beat the market, there was a stock picker that under-performed the market. There is no way around this, and 2020 was no different than any other year in this regard.

Only index fund investors performed as well as the market, sans fees.
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MinnGuyInvesting
Posts: 360
Joined: Fri Dec 11, 2020 9:24 am

Re: 2020 was a great year for individual stock pickers

Post by MinnGuyInvesting »

bligh wrote: Tue Jan 12, 2021 1:08 pm
MinnGuyInvesting wrote: Tue Jan 12, 2021 12:28 pm
bligh wrote: Tue Jan 12, 2021 12:10 pm I see so many similarities between today and the dotcom bubble.

The day trading. I personally have 4 people in my immediate friends circle that have taken up day trading, three of them do it full time now.

The stories in the press on newly minted bubble stock millionaires.

The complete disregard for fundamental valuations when pricing a stock. Back then the internet age had dawned and you better jump on the bandwagon or get left behind. Now it is the green age or AI age has dawned and you better jump on the bandwagon or get left behind.

Being told that you are out of touch for the new economy and getting made fun of when pointing the above out or shutting down rational conversation by discussing your massive gains over the last 6 months. ie. "You are obviously wrong, because look at how much more money I made compared to you in the market than you did". I remember when even Warren Buffet was being pressured and criticized as he sat out the dotcom years.
I think a couple things are different.

1. More education / accessibility. This will continue to evolve. You couldn't trade on an app (or if you could, people weren't in 2003).

2. More investing. People are "saving / investing" more after 2009. I believe this to be 100% true.

3. Right now people are worried about the value of the $$$ diminshing, so throwing money at big companies you believe will stick around is safer than holding cash (in people's opinions).

4. If you are indexing via any major index fund, you are adding to the problem by being heavily invested in Apple, Microsoft, facebook, amazon, Alibaba, etc.

None of these three factors indicate impending doom for the stock market.
Sure you can point out the many ways in which "it is different this time". They did that back in 1999 too.

“History Doesn't Repeat Itself, but It Often Rhymes” – Mark Twain.
History doesn't have to repeat itself for a timeframe designated by random BH'ers trying to prove me wrong. Trends only need to continue as long as I'm invested in those particular stocks or funds.
Index ETF's 41% |ARK Funds 39% | AAPL 5% | TSLA 3% | GOOGL 1% | AMZN 1% |Other stocks 5% | BTC/ETH 5% | | | Tracking my porfolio: https://www.bogleheads.org/forum/viewtopic.php?p=5745280#p5745280
000
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Re: 2020 was a great year for individual stock pickers

Post by 000 »

boglehat wrote: Tue Jan 12, 2021 1:17 pm Mathematically, for every stock picker that beat the market, there was a stock picker that under-performed the market. There is no way around this, and 2020 was no different than any other year in this regard.

Only index fund investors performed as well as the market, sans fees.
Only true if you define index fund as total market fund.

Many individual stock pickers beat the S&P 500 committee stock pickers this year.
Nathan Drake
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Re: 2020 was a great year for individual stock pickers

Post by Nathan Drake »

MinnGuyInvesting wrote: Tue Jan 12, 2021 12:29 pm Oh, and by the way, I kicked butt in choosing my own stocks.

I had $300 in Nikola and sold at a loss, but more than made up for it with heavier investments in TSLA!!! :moneybag :moneybag :moneybag :moneybag :moneybag



:sharebeer

Have you sold TSLA? If not, your “money” hasn’t been realized
langlands
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Joined: Wed Apr 03, 2019 10:05 pm

Re: 2020 was a great year for individual stock pickers

Post by langlands »

Nathan Drake wrote: Tue Jan 12, 2021 1:59 pm
MinnGuyInvesting wrote: Tue Jan 12, 2021 12:29 pm Oh, and by the way, I kicked butt in choosing my own stocks.

I had $300 in Nikola and sold at a loss, but more than made up for it with heavier investments in TSLA!!! :moneybag :moneybag :moneybag :moneybag :moneybag



:sharebeer

Have you sold TSLA? If not, your “money” hasn’t been realized
Have you sold your index funds? If not, your “money” hasn’t been realized
surfstar
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Location: Santa Barbara, CA

Re: 2020 was a great year for individual stock pickers

Post by surfstar »

RE: 2020 was a great year for individual stock pickers

This just in: My brother always wins at blackjack when he tells me how he did.
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