Yep, Katie and I started with 1% of net worth and have let it expand from there.
Instead of thinking of it as a fixed percentage, we ask "What dollar amount do we want to have as a diversified, conservative basis?"
Now that we've accumulated that much (in beta), new earnings beyond what pay for expenses can go to alpha. I.e. the alpha percentage increases over time.
I strongly believe this follows risk tolerance and how much education an investor has about an asset class. Why institutional investors swim into Cryptocurrency in the first place it’s it’s high yield. With proper education 10-30% is ok. I personally stay at 50% because it can get me easily to the goal faster and it is fun to see raw mental talent in display in the well researched opportunities that I stumble upon daily. Read more about crypto and you will love it
Baguette is so sweet! The closest I came to investing was salary sacrificing extra into my super fund. My daughter is more into the stock market. She loves analysing data.
I'm not an investor. The main reason is because I'm not much of a risk taker. I've dabbled in local stocks but they've all been reduced to nothing today (they just shrank by themselves, not just the price but the units as well, i'm still unsure how it all happened!!!). I'm not a spender, I save a minimum of 30% of my gross income on an average as retirement funds for both my spouse and myself. I have three sources of income but they all require time and effort. A fourth tiny source are dividends from some bonds. I hope to reach the point where I can earn enough dividends to support my family one day.
Will, so you are a big saver. Those funds are going somewhere…..Would you agree your best target is to achieve your best sustainable living standard? It is attainable and knowable.
I am glad! I would have high hopes for you if you were at student of mine at SMU. Living standard should be the goal of every financial planner, but most want to sell products.
I always say that no matter your risk tolerance level, don’t stay off the market, at least at S&P 500 for safety reasons. The first 5 years-10 years of investing if done actively can yield passive year on year till 20th year of continuous investment.
The reason majority of my active investments are in crypto is to help me fund my 15 years for passive wealth in the future.
The mechanism of DCA(dollar-cost-averaging has been definitely helpful in this years, everyone should find a newsletter like this to stay connected to the investment psychology while learning to be disciplined.
You don’t need to join my in crypto but don’t stay off the active 20 years of investing
I always say that no matter your risk tolerance level, don’t stay off the market, at least at S&P 500 for safety reasons. The first 5 years-10 years of investing if done actively can yield passive year on year till 20th year of continuous investment.
The reason majority of my active investments are in crypto is to help me fund my 15 years for passive wealth in the future.
The mechanism of DCA(dollar-cost-averaging has been definitely helpful in this years, everyone should find a newsletter like this to stay connected to the investment psychology while learning to be disciplined.
You don’t need to join my in crypto but don’t stay off the active 20 years of investing
I read Kiyosaki's "The Cashflow Quadrant". He makes a compelling case for being an investor.
That book appeared in results when I searched for this concept.
Perhaps the host of the convention I attended copied it from there.
Interesting post.
My only comment on crypto is that advice coming from Hedge Fund owners is to not hold more than 5% of your total Networth.
That’s a general barometer.
But at least if your entire crypto is wiped out you can still carry on playing.
Thanks for reading and for your comment.
Yep, Katie and I started with 1% of net worth and have let it expand from there.
Instead of thinking of it as a fixed percentage, we ask "What dollar amount do we want to have as a diversified, conservative basis?"
Now that we've accumulated that much (in beta), new earnings beyond what pay for expenses can go to alpha. I.e. the alpha percentage increases over time.
I strongly believe this follows risk tolerance and how much education an investor has about an asset class. Why institutional investors swim into Cryptocurrency in the first place it’s it’s high yield. With proper education 10-30% is ok. I personally stay at 50% because it can get me easily to the goal faster and it is fun to see raw mental talent in display in the well researched opportunities that I stumble upon daily. Read more about crypto and you will love it
Yeah, the people who make it their careers to learn about it could feel comfortable allocating more.
People who allocate more than they can intellectually explain will then emotionally sell during drawdowns.
Baguette is so sweet! The closest I came to investing was salary sacrificing extra into my super fund. My daughter is more into the stock market. She loves analysing data.
Thanks, yeah Baguette is precious and has gotten snuggly.
We adopted her when she showed up in our back yard out of the woods a few years ago.
At first, she wasn't a fan of ceilings / being indoors / snuggles.
Now snuggles are very much part of her morning and night routine.
I'd never heard of a super fund! Tucking away money on autopilot is great.
I'm not an investor. The main reason is because I'm not much of a risk taker. I've dabbled in local stocks but they've all been reduced to nothing today (they just shrank by themselves, not just the price but the units as well, i'm still unsure how it all happened!!!). I'm not a spender, I save a minimum of 30% of my gross income on an average as retirement funds for both my spouse and myself. I have three sources of income but they all require time and effort. A fourth tiny source are dividends from some bonds. I hope to reach the point where I can earn enough dividends to support my family one day.
Will, so you are a big saver. Those funds are going somewhere…..Would you agree your best target is to achieve your best sustainable living standard? It is attainable and knowable.
Yes, I'd agree. Yes.
Thanks for your comments and restacking! I'll reply at https://substack.com/@whalehunt/note/c-54602608?utm_source=activity_item
I am glad! I would have high hopes for you if you were at student of mine at SMU. Living standard should be the goal of every financial planner, but most want to sell products.
I always say that no matter your risk tolerance level, don’t stay off the market, at least at S&P 500 for safety reasons. The first 5 years-10 years of investing if done actively can yield passive year on year till 20th year of continuous investment.
The reason majority of my active investments are in crypto is to help me fund my 15 years for passive wealth in the future.
The mechanism of DCA(dollar-cost-averaging has been definitely helpful in this years, everyone should find a newsletter like this to stay connected to the investment psychology while learning to be disciplined.
You don’t need to join my in crypto but don’t stay off the active 20 years of investing
When talking about equities, my definition of passive is:
🟢 index funds only (not mutual funds or individual stocks)
🟢 held for decades (not trying to time when to buy and sell based on what current prices are)
I definitely never recommend for people to actively trade.
In these personal reflections, your readers should know many of these investment thoughts apply to them.
I appreciate that, Robert!
Are you referring to any sentence in particular?
Ryan....just your specifics that I roll up as your general tone.
I always say that no matter your risk tolerance level, don’t stay off the market, at least at S&P 500 for safety reasons. The first 5 years-10 years of investing if done actively can yield passive year on year till 20th year of continuous investment.
The reason majority of my active investments are in crypto is to help me fund my 15 years for passive wealth in the future.
The mechanism of DCA(dollar-cost-averaging has been definitely helpful in this years, everyone should find a newsletter like this to stay connected to the investment psychology while learning to be disciplined.
You don’t need to join my in crypto but don’t stay off the active 20 years of investing
https://open.substack.com/pub/ryanwalsh/p/investor?r=jrlj8&utm_campaign=comment-list-share-cta&utm_medium=web&comments=true&commentId=54944157