Addicted to investing?

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elitistuser
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Addicted to investing?

Post by elitistuser » Thu Dec 08, 2016 10:55 am

So,started my portfolio and educating myself on passive investing. Been reading and watching the stockmarket news on my ipad. Problem l find is , l wanna purchase more funds and wanna invest in more sectors.

The lazy philosophy to passive investing is to buy tracker funds and then leave it but its so hard when u get the investing bug. I've not touched my portfolio since setting it up and putting a direct debit on my bank account to purchase on a monthly basis. However aren't others finding it tough to not do anything ?


Les

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rmelvey
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Re: Addicted to investing?

Post by rmelvey » Thu Dec 08, 2016 10:59 am

I think it's normal when you start out to feel that way. However, after watching the market for so long I really feel that it is so unpredictable I can't imagine doing anything but just buying and holding the index.

rbaldini
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Re: Addicted to investing?

Post by rbaldini » Thu Dec 08, 2016 11:17 am

I remember feeling this way after first learning the Boglehead basics: good investing is boring. You gain all this knowledge, and yet most of the time you do nothing.

I find the best cure is to log onto the forum and share or debate your ideas with others.

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DaftInvestor
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Re: Addicted to investing?

Post by DaftInvestor » Thu Dec 08, 2016 11:18 am

It sounds like your problem is not that you are "addicted to investing" but rather that you are getting restless being passive invested.
Some handle this by having a percentage of their portfolio (5% or less) as "Play" money - money you can use to invest in individual stocks or sector picks.
Personally I feel you should just find another hobby versus feel the need to muck with your portfolio with every article or book you read. One thing you can do is to keep tracking and re-balancing as needed but sounds like this might not be enough for you.

orca91
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Re: Addicted to investing?

Post by orca91 » Thu Dec 08, 2016 11:20 am

elitistuser wrote:However aren't others finding it tough to not do anything ?


Nope. It's rather easy really. :happy

I agree with above that it's pretty normal when you start out to feel like you do. I was similar and trying to take it all in, and think what if... what if... what if...

I'm only a few years in myself and I'm now very fond of the set it and forget it style. Too easy, and there's better things to do out there.

nova1968
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Re: Addicted to investing?

Post by nova1968 » Thu Dec 08, 2016 12:17 pm

I was that way my self for several years following the philosophy of Investors Daily, At the same time I was in the TSP which incorporates index fund. I did a comparative analysis based on several tears of returns and concluded the passive index funds performed much better over the long haul.

grettman
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Re: Addicted to investing?

Post by grettman » Thu Dec 08, 2016 12:30 pm

The more you play, the greater the chance of screwing it up. Follow the advice of folks here and stick to passive. I agree that if this still drives you crazy, cut out about 1-5% as Mad Money so that you play along with Cramer or something. I have done this and regretted it so I am 100% passive and automate my purchases. If you are bored, why not develop elaborate spreadsheets / pivot tables and track your money...develop graphs... track performance.... run firecal models and etc. And maybe...volunteer to teach people about Personal Finance....

elitistuser
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Re: Addicted to investing?

Post by elitistuser » Thu Dec 08, 2016 1:00 pm

Yep, l won't be purchasing anything other than what l have in my current portfolio. Its just that information is so readily accessible, l have a ipad and just a click of a button access the financial news within seconds.

The only thing that has attracted me is Gold. It seems just now with the market highs, there are those who preach of a once in a lifetime 80% market crash following very soon. So Gold is a hot hot topic.

Les,

Nowizard
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Re: Addicted to investing?

Post by Nowizard » Thu Dec 08, 2016 1:20 pm

This type of thread has personal appeal since there are relatively few that delve into psychological aspects of investing. Unlike many here, I do have the urge to "do something" frequently other than rebalance even though I have been investing for many years with desired outcomes. However, I have also arrived at the point of knowing that passive, stay-the-course investing is the way to go which creates the conflict you describe.
Without knowing your history in terms of time investing or asset base, it is difficult to determine whether you are simply dealing with a relatively new approach to investing or whether it is an itch longing to be scratched for a longer period of time.

If you have determined you are on track for long term goals, then you may have options. For example, taking a relatively small amount and using it to over-weight a sector with individual stocks or an actively managed fund gives you something you can use to scratch that itch. Also, there are funds that do outperform the indexes, though the challenge is determining which ones. We, for example, split large cap assets between Vanguard TSM and Dodge and Cox Stock. Dodge and Cox started the year slowly (Friend sold it) but is up 19.77% YTD vs. 10.53 YTD for TSM (VTSAX). Five year returns are 16.97 (DODGX) and 14.38 (VTSAX). That is not to say Dodge and Cox is superior, just that it has performed on a level with TSM which has met annual goals. Any extra return is welcome, of course, but is not assured. The main thing is that it scratches that itch. If there were to be a long term, negative difference between the two, it would result in combining the two funds into one. I know this does not meet strict Boglehead ideas since one of these is a total market, the other is not, but it does fit for us. Other analyses such as Morningstar X-Ray determine overall stock/bond ratios due to the difference in fund holdings.

Basically, a small mix between index and active funds can scratch that itch, as can over weighting a sector with an active fund or by purchasing individual within a specific sector. It makes for a more complex portfolio. You can also consider such a decision as reflecting a higher risk tolerance than some others who might label it as unjustified. Results of those decisions occur from a combination of risk based on factual/psychological factors rather than only factual analysis. A key part of your decision is, presumably, based on determining an approach that will possibly increase overall returns while reducing the losses that could come from overly frequent or impulsive trading if this approach is not followed.

Another way of dealing with your issue that I think is used by many here is to use a non-trading approach entirely and engage in discussions here that analyze research, and delve into details of investing concepts. In that sense you would become a "frequent trader" and consumer of information rather than a frequent trader of stocks or funds.

These comments are unconventional for this site and would be considered nonsensical by some. As Taylor says, however, there are many roads to Dublin. This one has taken us there, along with the tremendous help and advice from many on this forum.

Tim

Gropes & Ray
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Re: Addicted to investing?

Post by Gropes & Ray » Thu Dec 08, 2016 2:37 pm

If you're like me you get on little "kicks" where something occupies a large portion of your thoughts for a few months and then is later forgotten. When investing starts to bog me down, I try to distract myself with something else. Here is a short list of my favorite things that can be used as distractions:

Guns/hunting
Fishing
Hiking/camping
Guitars
Home improvement
Cooking
Reading about history/politics

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TinkerPDX
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Re: Addicted to investing?

Post by TinkerPDX » Thu Dec 08, 2016 2:54 pm

elitistuser wrote:However aren't others finding it tough to not do anything ?


Sounds to me like you need a way to "do something" without actually doing anything (ie, while actually staying the course).

I scratch this itch by manually allocating my twice-monthly contributions according to my IPS, buying into the appropriate funds. So I get to look at my spreadsheet (which now updates automatically via the googlefinance formula feature, which is awesome), which once I put in the new figure for "cash," tells me where I need to invest that cash to keep my portfolio on track with my AA.

My portfolio is index-based, but perhaps overly-complicated: large/large value, mid/mid value, small/small value, REITs, international, emerging, international small, international value, international REITs, US nominal bond, US TIPS, and international bonds. While many would say it'd be better to simplify, having it so fine-grained allows me to feel like I'm "doing something" when really all I'm doing is carrying out my IPS and staying the course.

If you want even more to "do" (without actually meddling), you can use ETFs instead of mutual funds and get more aggressive with limit orders.

Gradually I'm getting better at only looking when I need make my purchases twice a month, and I'm working on reducing even that frequency... but for me, it's still a little bit entertaining, so I figure as long as it doesn't cause me to deviate from my IPS, it's all to the good.

retire57
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Re: Addicted to investing?

Post by retire57 » Thu Dec 08, 2016 2:58 pm

Resist the expensive impulse to tinker. Instead maybe funnel your attention to tracking your investments. Quicken or other personal finance software can keep you busy.

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FelixTheCat
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Re: Addicted to investing?

Post by FelixTheCat » Thu Dec 08, 2016 3:25 pm

My psychosis comes from budgeting. I used to budget from an Excel spreadsheet. I could never figure out why I steal from my emergency fund from time-to-time. I got YNAB to monitor my budget. :happy
Felix is a wonderful, wonderful cat.

Lou354
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Re: Addicted to investing?

Post by Lou354 » Thu Dec 08, 2016 3:35 pm

When I get the urge to do something I usually log onto bogleheads.org instead until the feeling passes. :P

Fallible
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Re: Addicted to investing?

Post by Fallible » Thu Dec 08, 2016 4:43 pm

elitistuser wrote:So,started my portfolio and educating myself on passive investing. Been reading and watching the stockmarket news on my ipad. Problem l find is , l wanna purchase more funds and wanna invest in more sectors.


Right, that is the problem - you can't just look, you are finding it hard not to act. When I first started investing, I also watched the market and my funds daily, realized not much happens, grew bored and moved on, or back to, my other interests in life. Some can do that, some find it harder to do it. You are fairly new to investing so I would suggest that for now you learn how to resist the temptation to take on more risk. While you're resisting, spend time reading up on alternative investments until you fully, truly understand what you're getting into. Take your time, learn patience, aim for discipline, self-control, simplicity. You will need these traits no matter how you invest. As you can see, passive investing is not as "lazy" as it sounds; there is a lot to do to stay the course. [/quote]

Yes, others also find it difficult to stop watching daily market news and resist the Temptation:
viewtopic.php?f=11&t=188638
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

Argus714
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Re: Addicted to investing?

Post by Argus714 » Thu Dec 08, 2016 5:06 pm

I have a similar opinion to DaftInvestor who suggests "investing" with play money. What I don't agree with is the 5% play money. I have investments, and then I have a trading account. The cash in the trading account is what I feel would not impact my lifestyle if it were to disappear. Which in my case is in the neighborhood of 1% to 1.5% of my investment holdings.

Once the trading account reaches the upper limit of my comfort zone, I withdraw it and stick it in my IRA or buy a 6-month CD (to keep it tied up so I don't move it back into the trading account...).

Anyway, that's my approach and it seems to scratch the itch.

Saphomd
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Re: Addicted to investing?

Post by Saphomd » Thu Dec 08, 2016 5:29 pm

All my investments are with Vanguard, mostly index funds and a couple of Vanguard active funds. Everyday before I go to work, I like to go online and see what Morningstar, the Street, Kiplingers, etc has to say about the market and investing in general. There are times when I feel like something is missing in my portfolio and I want to add on. However, my AA , emergency fund, etc is all set. All I really have to do is re-balance when appropriate. Its difficult not to do something, like a Dodge and Cox fund that I like like, but then I start thinking about John Bogle and the Bogleheads philosophy to just stay the course and stay with low expenses. I still am 10 13 years away from retirement, so may be later I will do something. I do understand what the OP is talking about. Thanks to everyone for reading my post. I appreciate any comments.

Elena
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Re: Addicted to investing?

Post by Elena » Thu Dec 08, 2016 6:54 pm

elitistuser wrote:So,started my portfolio and educating myself on passive investing. Been reading and watching the stockmarket news on my ipad. Problem l find is , l wanna purchase more funds and wanna invest in more sectors.

The lazy philosophy to passive investing is to buy tracker funds and then leave it but its so hard when u get the investing bug. I've not touched my portfolio since setting it up and putting a direct debit on my bank account to purchase on a monthly basis. However aren't others finding it tough to not do anything ?
Les

I get what you are feeling. I was able to tame the urge by: getting addicted to reading about finances (without investing, just letting what I have be), and getting addicted to budgeting to the point of tracking every minute detail and learning formulae to calculate every percentage of every possible budget aspect (saving, spending, projecting expenditure and savings goals). I hope this helps with the psychological aspect.

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