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by chii 2336 days ago
there's empirical evidence that by using a broad, well diversified index fund, and consistently remained invested in the market, you can get an average return of about 6-7% per annum over the very long run (30+ yrs).

The problem is only when you don't have enough "spare" wealth to invest because the daily costs have all eaten up your paycheck. That's a problem i dont know how to solve.
1 comments
coliveira 2336 days ago
There is empirical evidence that people only come up with this "average" on periods when the market is at the top. If you did your calculations around 2008 you would see a very different picture.

It is easy to be bullish on the market when everything seems to be doing well; a wise person needs to look at different periods, and see that the stock market also has produced a lot of disasters. People who lack this perspective are bound to be engulfed by such disasters. Heck, I hear that even professional investors, who are paid to buy stocks, are starting to take their money out of the market fearing of what might come next.

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chii 2335 days ago
> Heck, I hear that even professional investors who are paid to buy stocks, are starting to take their money out of the market fearing of what might come next.

and that's why most active managed funds perform worse than most passive index funds. that's why stock picking doesn't work for most (unless you're buffett). That's why timing the market doesn't work.

People are too emotional. If you stick to an algorithmic method (of putting in part of your paycheck every month), ride the ups and the downs (don't sell, don't take on debt to buy extra, unless you can afford the debt easily etc), you will come out ahead more times than behind.

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WalterBright 2336 days ago
> Heck, I hear that even professional investors, who are paid to buy stocks, are starting to take their money out of the market fearing of what might come next.

I hear that most every day, every year, every decade. There's always plenty of reasons to not invest. There's always an article in the financial news predicting imminent doom.

I ride them up, down, and back up again.

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