Do you ever feel you've missed out due to the 3-fund portfolio?

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Zillions
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Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
Big Dog
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Big Dog »

The Total Stock fund includes Tesla, so you also get a piece of the action.
austin757
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by austin757 »

I don't. Something that may help you avoid fear of missing out (FOMO) is having a small portion of your portfolio in single stocks or other investments outside of a 3-fund portfolio. You can let the index funds do the bulk of the accumulating, while still having some money, albeit a smaller amount, going toward investments like TSLA or something else.
whereskyle
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by whereskyle »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
"There is nothing so disturbing to one's well-being and judgment as to see a friend get rich." The Behavioral Finance section of a Random Walk Down Wall Street is fantastic, and you should probably (re)visit it! Envy is a natural part of being human.

It also contributes to bubbles, and I don't see how Tesla is not bubbling right now. Good thing it's only 2% of my portfolio! (Unless it really got that big today?)
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
jebmke
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by jebmke »

you rarely hear from these friends and relatives when they lose big. Unless they need money.
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Dottie57
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Dottie57 »

No,I don’t feel like I have lost out due to the 3 fund portfolio. I started to have better returns.
Lastrun
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Lastrun »

Imagine if you could be guaranteed to shoot par every time you played a round of golf--exactly par on each hole, not a stroke more or less. This is what you get with a well-constructed passive market-weight three fund portfolio. Despite all the pin head dancing here, that is what this forum is all about.

Your brother shot a hole-in-one today, you never will with a three fund.

But ultimately you will win more rounds.

Take a look at the SPIVA studies. https://www.ifa.com/articles/despite_br ... d_-_works/
Last edited by Lastrun on Mon Jul 06, 2020 8:10 pm, edited 1 time in total.
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9-5 Suited
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by 9-5 Suited »

How much did he actually make though? On quick glance TSLA is up 13%, so he made $13k for every $100k invested. Not really life changing unless he had seven figures in there. These things are very fleeting. Recently Elon tweeted (kind of humorously) that he thought Tesla stock was overvalued. It dropped about 10% that day.

There will always be people outperforming you, especially in the short term, when you index. It’s the long term that matters, and truly savings rate and investing discipline will create wealth, not temporary outperformance of a few risky bets. YMMV of course.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by whereskyle »

Lastrun wrote: Mon Jul 06, 2020 8:08 pm Imagine if you could be guaranteed to shoot par every time you played a round of golf--exactly par on each hole, not a stroke more or less. This is what you get with a well-constructed passive market-weight three fund portfolio. Despite all the head pin dancing here, that is what this forum is all about.

Your brother shot a hole-in-one today, you never will with a three fund.

But ultimately you will win more rounds.

Take a look at the SPIVA studies. https://www.ifa.com/articles/despite_br ... d_-_works/
Love the post.

You might be overstating how well his brother did today though. We don't know what percent of the portfolio is on Tesla, but I imagine it is not everything. Meanwhile, there are days when the total market grows 7%. For some people, that's their entire equity position. That might be just as good of a day as his brother had across the portfolio.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
FlyingMoose
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by FlyingMoose »

I feel like I missed out by having a 3-fund portfolio instead of a 2-fund portfolio, since international has done so poorly.
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TheTimeLord
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by TheTimeLord »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
Nope, I make my investment decisions deliberately and with knowledge of the possible outcomes. I would no more regret not owning Tesla than I would regret not being 100/0 since 2009. As long a I understand the reasoning behind my investment decisions I am comfortable accepting the consequences of those decisions.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]
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midareff
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by midareff »

Keep in mind the "players" always tell you about the winners... especially the ones they did very well with. The losers, they tend to forget to mention them. Everybody is a star portfolio manager but you... is that the deal?
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
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TheTimeLord
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by TheTimeLord »

Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
If my math is correct that means your brother has roughly $445,000 invested in Tesla stock. Unless he is an options guy.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

TheTimeLord wrote: Mon Jul 06, 2020 8:38 pm
Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
If my math is correct that means your brother has roughly $545,000 invested in Tesla stock. Unless he is an options guy.
Not sure, but he is straight with me. If he says he made 54K, yes, he made 54K. He's a physician (married to another physician) and has deep pockets so it is entirely possible that he's got that kind of money in TSLA or dabbles in options (he's a gambler).
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by whereskyle »

Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
Seriously. It's perfectly natural to feel that way. Read A Random Walk Down Wall Street. This is textbook behavioral finance.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

whereskyle wrote: Mon Jul 06, 2020 8:41 pm
Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
Seriously. It's perfectly natural to feel that way. Read A Random Walk Down Wall Street. This is textbook behavioral finance.
Thank you, I will.
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tvubpwcisla
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by tvubpwcisla »

Why do just the three fund portfolio? Why not do both? In fact there is nothing wrong with doing the three fund portfolio, individual equities, and also having a managed account with small fees all at the same time. Investing doesn't have to be an all or none strategy.
Stay invested my friends.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by TheTimeLord »

Zillions wrote: Mon Jul 06, 2020 8:40 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:38 pm
Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
If my math is correct that means your brother has roughly $545,000 invested in Tesla stock. Unless he is an options guy.
Not sure, but he is straight with me. If he says he made 54K, yes, he made 54K. He's a physician (married to another physician) and has deep pockets so it is entirely possible that he's got that kind of money in TSLA or dabbles in options (he's a gambler).
I was just trying to point out the size of the investment required for the gain.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

TheTimeLord wrote: Mon Jul 06, 2020 8:46 pm
Zillions wrote: Mon Jul 06, 2020 8:40 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:38 pm
Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
If my math is correct that means your brother has roughly $545,000 invested in Tesla stock. Unless he is an options guy.
Not sure, but he is straight with me. If he says he made 54K, yes, he made 54K. He's a physician (married to another physician) and has deep pockets so it is entirely possible that he's got that kind of money in TSLA or dabbles in options (he's a gambler).
I was just trying to point out the size of the investment required for the gain. Looks like Tesla is up almost another 4.5% in after hours trading.
Well, I'm gonna smack him really hard if he tells me about it.... J/K.

I am not surprised at all. In fact, at Thanksgiving, when TSLA was in the 200s (I believe) he was pushing me to buy it. Said he'd pay for 50 shares as Christmas present for my son with autism. UGH. I can't believe I passed up on it.
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dodecahedron
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by dodecahedron »

I had not looked at TSLA for a while. My late husband generally stuck to passive index investing but he made a special exception for TSLA and bought a significant chunk at $38 in early 2013. He found it fascinating and exciting to watch it go up in the next few months and even bought some options in it, which he cashed out for a significant gain, and then died unexpectedly of a heart attack about 10 days later. (No idea if there was any causal connection, but the association between his profitable dabbling in TSLA and his death are very much linked in my mind.) Although he made money on the options position, he told me that he did not like the way it made him feel--he said about 10 days before his death that he could feel his heart racing. He said he would not be doing any more options trades but would hang onto the TSLA stock and consider selling when it hit $200. (I think it was close to $100 when he said this.) So he still had the TSLA stock in his Roth IRA when he died.

It took a few months for me to get access to all his accounts after his death. TSLA continued to rise during that time. But I found the whole position stressful. I can´t remember exactly what I sold it for, maybe around $140, about a tenth of its price today.

No regrets whatsoever!

I would not have wanted all the stress of hanging onto it over the last seven years. And wondering today, ¨Should I sell today or hang on later.¨

I do not need that kind of stress in my life. The incremental ¨utility" from the additional wealth would not have been worth all the stress.

Very contented to have a hard and fast rule in my IPS: no individual stocks!
Last edited by dodecahedron on Mon Jul 06, 2020 10:55 pm, edited 2 times in total.
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

dodecahedron wrote: Mon Jul 06, 2020 8:50 pm I had not looked at TSLA for a while. My late husband generally stuck to passive index investing but he made a special exception for TSLA and bought a significant chunk at $38 in early 2013. He found it fascinating and exciting to watch it go up in the next few months and even bought some options in it, which he cashed out for a significant gain, and then died unexpectedly of a heart attack. Although he made money on the options position, he told me that he did not like the way it made him feel. He said he would not be doing any more options trades but would hang onto the TSLA stock and consider selling when it hit $200. (I think it was close to $100 when he said this.)

It took a few months for me to get access to all his accounts after his death. TSLA continued to rise during that time. But I found the whole position stressful. I can´t remember exactly what I sold it for, maybe around $140, about a tenth of its price today.

No regrets whatsoever!

I would not have wanted all the stress of hanging onto it over the last seven years. And wondering today, ¨Should I sell today or hang on later.¨

I do not need that kind of stress in my life. The incremental ¨utility" from the additional wealth would not have been worth all the stress.

Very contented to have a hard and fast rule in my IPS: no individual stocks!
I am sorry for your loss.

No regrets over TSLA? I guess what shakes me up about this is that I thought I was fully committed to the 3-fund portfolio - I turned down his offer to buy my son TSLA shares as a Christmas present. But apparently I am not as committed as I thought if the stock's moves makes me question if I did the right thing. I guess that's the issue here - am I really as Bogleheaded as I pretend to be?

That, and being jealous of my own brother. Really classy.
deltaneutral83
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by deltaneutral83 »

This is nothing. The 12 month 20 baggers back in 1999 make Tesla look pretty bland. Does Tesla even have profits yet?
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by reln »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
No.

Don't be jealous of others. Don't make others jealous of you.
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TheTimeLord
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by TheTimeLord »

Zillions wrote: Mon Jul 06, 2020 8:53 pm
dodecahedron wrote: Mon Jul 06, 2020 8:50 pm I had not looked at TSLA for a while. My late husband generally stuck to passive index investing but he made a special exception for TSLA and bought a significant chunk at $38 in early 2013. He found it fascinating and exciting to watch it go up in the next few months and even bought some options in it, which he cashed out for a significant gain, and then died unexpectedly of a heart attack. Although he made money on the options position, he told me that he did not like the way it made him feel. He said he would not be doing any more options trades but would hang onto the TSLA stock and consider selling when it hit $200. (I think it was close to $100 when he said this.)

It took a few months for me to get access to all his accounts after his death. TSLA continued to rise during that time. But I found the whole position stressful. I can´t remember exactly what I sold it for, maybe around $140, about a tenth of its price today.

No regrets whatsoever!

I would not have wanted all the stress of hanging onto it over the last seven years. And wondering today, ¨Should I sell today or hang on later.¨

I do not need that kind of stress in my life. The incremental ¨utility" from the additional wealth would not have been worth all the stress.

Very contented to have a hard and fast rule in my IPS: no individual stocks!
I am sorry for your loss.

No regrets over TSLA? I guess what shakes me up about this is that I thought I was fully committed to the 3-fund portfolio - I turned down his offer to buy my son TSLA shares as a Christmas present. But apparently I am not as committed as I thought if the stock's moves makes me question if I did the right thing. I guess that's the issue here - am I really as Bogleheaded as I pretend to be?
Is there any reason to believe that left to your own devices you would have ever invested in Tesla, Boglehead or not. My guess is that kind of investing/risk is not part of your nature or something you can feel you can do safely. Nothing wrong with that, I am afraid of highs so no matter how cool and beautiful rock climbing looks I am staying on the ground. So I accept that about myself and look for things that work for me.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by dodecahedron »

Zillions wrote: Mon Jul 06, 2020 8:53 pm
dodecahedron wrote: Mon Jul 06, 2020 8:50 pm I had not looked at TSLA for a while. My late husband generally stuck to passive index investing but he made a special exception for TSLA and bought a significant chunk at $38 in early 2013. He found it fascinating and exciting to watch it go up in the next few months and even bought some options in it, which he cashed out for a significant gain, and then died unexpectedly of a heart attack. Although he made money on the options position, he told me that he did not like the way it made him feel. He said he would not be doing any more options trades but would hang onto the TSLA stock and consider selling when it hit $200. (I think it was close to $100 when he said this.)

It took a few months for me to get access to all his accounts after his death. TSLA continued to rise during that time. But I found the whole position stressful. I can´t remember exactly what I sold it for, maybe around $140, about a tenth of its price today.

No regrets whatsoever!

I would not have wanted all the stress of hanging onto it over the last seven years. And wondering today, ¨Should I sell today or hang on later.¨

I do not need that kind of stress in my life. The incremental ¨utility" from the additional wealth would not have been worth all the stress.

Very contented to have a hard and fast rule in my IPS: no individual stocks!
I am sorry for your loss.

No regrets over TSLA? I guess what shakes me up about this is that I thought I was fully committed to the 3-fund portfolio - I turned down his offer to buy my son TSLA shares as a Christmas present. But apparently I am not as committed as I thought if the stock's moves makes me question if I did the right thing. I guess that's the issue here - am I really as Bogleheaded as I pretend to be?
Sleeping well at night and, more generally, good health, is precious. TSLA has been a very stressful stock to hold.

My needs are very modest and I already have far more than I need. That said, I can not say for sure that I would have had no regrets, if I had a child with autism and was worried about whether I had enough to provide for his future after I am gone.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by jason2459 »

I do absolutely feel like I've been missing out by using the 3 fund portfolio method to guide my allocations.

Because I just started doing it I realized I've been missing out on a very simple and easy to follow implementation to drive me through life long planning and investing.

I've done really well with some investments but absolutely horrible with others. I first started thinking I was a great stock picker. Anyone know how well S3 graphics, Novel, and 3com did in 2001... I actually hold one stock from my E-Trade "day trader" days to remind me not to be stupid anymore. It's about worthless. It was a pink slip stock I picked up thinking it was on the verge of bursting out. There was definitely some bursting going on. I actually still see Salon media group is around and the stock has about a value of when it was as a pink slip when I picked it up. I had bought like 1000 shares of it but through a few reverse splits I think I own like 10 shares now. Only stock I still own and will never sell just to keep me from doing that again... A novelty and souvenir.

Then I got into some ETFs with SPY, DIA, and QQQ. Just because they were the thing. Thought I couldn't go wrong there. 2009 hit and I panic sold spy and dia... Don't know why I didn't sell QQQ. It made up for all past mistakes. But then during the long run bull market I started getting the trading itch and kept thinking I knew what I was doing buying some cool flashy ETFs. I think at one point I had around 30 or so.

Since 2019 I realized I needed to start thinking about retirement. I started taking a hard look at my portfolios. I started consolidating just feeling like I had spiraled out of control with the amount of overlapping ETFs and also some of their fees were crazy. I wanted to simplify. I also planned a long time ago to get into some bonds around 2020 but had no clue about them. Still having a hard time figuring them out in the big scheme of things. But I've got another 10 years before I really want to get a sizable allocation to them.

Then I stumbled on this site several months ago and everything clicked. So wish I found it on morning star in 2000. I would be in so much better position then I am now which isn't horrible but yes I've missed out by not simplifying from the beginning. Even through my gains with QQQ over the booming last decade I would be further ahead then I am now if I started in the 90's the way I'm setup now.

Short term gains are just that. And most likely not repeatable consistently. I had one really good move and pick, some mediocre ones, and some really bad ones. That was it. The 3 fund portfolio may be simple and may not look fancy and shiny in the day to day but from decade to decade it would have well outperformed everything I did.

Yes, a very resounding yes, I feel I've missed out by now realizing what I've been missing by following Mr. Bogle and Mr. Larimore thanks to both of them and everyone contributing to this amazing forum.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by RomeoMustDie »

Yes, stay the course approach means you're the bag holder when the economy draws down since the 60/40 portfolio still draws down sharply in a market event like the April/March crash. With a less volatile portfolio, you retain your capital in a downturn and can take advantage of the moment in time to produce alpha as equity prices are reevaluated and VIX is high.

Also it's ironic that even though "nobody knows nothing", most bogleheads are ok with overweighting equities as an asset class and overweighting the USA in their portfolios with the assumption that those two items will continue to outperform.

I also think "timing the bottom" is a false dichotomy. What if you time 25, 50, or 75% of the way to the bottom? There is an entire range of values in between absolute market top and absolute market bottom. In a sense, rebalancing is "market timing" yet most bogleheads are not resistant to rebalancing.

I don't have the perfect answer to any of those questions, but I haven't found a satisfactory answer for the items above outside of the common dogma to this point.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Big Dog »

austin757 wrote: Mon Jul 06, 2020 8:01 pm I don't. Something that may help you avoid fear of missing out (FOMO) is having a small portion of your portfolio in single stocks or other investments outside of a 3-fund portfolio. You can let the index funds do the bulk of the accumulating, while still having some money, albeit a smaller amount, going toward investments like TSLA or something else.
Agreed, there is nothing in the 2-3 fund portfolio rule that says you can't have some investment play money. Peter Lynch of Fidelity Magellan fame always use to say, 'invest in what you know' (doing a fundamental stock research). If want to take a flyer on TSLA with money you can afford to lose, have at it.

My dad and MIL used to go to Reno at least once per year, but he had a weekend gambling budget of $300. When that was gone, he was done gambling. But still had a nice 3-days after taking in a show or two and getting some free drinks. "Play money", as he called it, 'cheap entertainment'.

So if you have play money burning a hole in your pocket.....
monkeytypist
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by monkeytypist »

Yes. Each of the past 3 years I've put $1000 into single stocks and/or crypto. I ended up with -$200, +$8, -$100 in returns, and each time I couldn't wait to get rid of my positions. I learned that I don't enjoy gambling.
helloeveryone
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by helloeveryone »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
Unless your brother sold all his TSLA holdings he didn't really "make a killing". I hear people say that all the time at work when CNBC is on, the ticker says so and so company is up "x" percent. Then they say man I just made $x dollars. But until they sell they actually haven't made the money.
RomeoMustDie
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by RomeoMustDie »

helloeveryone wrote: Mon Jul 06, 2020 9:26 pm
Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
Unless your brother sold all his TSLA holdings he didn't really "make a killing". I hear people say that all the time at work when CNBC is on, the ticker says so and so company is up "x" percent. Then they say man I just made $x dollars. But until they sell they actually haven't made the money.
Anyone holding a sufficient portion of QQQ is way ahead of the bogle 3 fund portfolio. Tech also seems to be the macro trend for the US and 100% QQQ backtests with superior returns to VTI.

Is it even speculation at this point to invest in tech if already weighting to the US whose economy is already driven by tech sector?
luckyducky99
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by luckyducky99 »

Viscerally, sometimes. But I think about it rationally and feel better.

It goes like this. Buying single stocks is risky. But obviously there's risk in investing, right? -- everyone knows that, so it's not obviously bad. But it's easy to forget there are different kinds of risk. Buying individual stocks isn't just risky like "you have more risk" -- it's risky in the sense that you're taking on uncompensated risk. Uncompensated risk is bad! It's risk without the expectation of any more reward! Why would I take more risk for no more expected return?

If you want more risk in your portfolio, sell bonds to buy stock. If you're already at 100% stock and want more risk, well you're braver than I am, but leverage up. You can clearly identify the costs and risks.

When I start feeling antsy, a couple times a year I buy a lottery ticket. It's silly, but it gives me the same tingly feeling of "ooh maybe I'll hit it big" and is enough to tide the risky part of my brain over. And it costs a couple bucks instead of thousands of dollars and untold anxiety.
Monsterflockster
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Monsterflockster »

Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
Hmmm. If he’s a gambler he’s probably lost more than he has won. He just doesn’t tell you when he takes an L.
02nz
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by 02nz »

Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler.
That's just it. He's gambling, not investing. How much anyone made on their single company stock today has exactly as much influence on how I look at investing as how much anyone made in Vegas today, that is to say, no influence at all.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Grt2bOutdoors »

Zillions wrote: Mon Jul 06, 2020 8:48 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:46 pm
Zillions wrote: Mon Jul 06, 2020 8:40 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:38 pm
Zillions wrote: Mon Jul 06, 2020 8:33 pm My brother is a gambler. He claims he made $54000 today just on TSLA and I have no reason to doubt him. I should be happy for him but ugh! envy! although our mileage varies.

I DO like the predictability the 3-fund portfolio has brought to our lives, although I am having a really hard time understanding Total Bond fund (as I posted earlier today). Plus, my / our personal life is quite chaotic at the moment so I should be avoiding the volatility / unpredictability of single stocks like the plague (and we are). But yes, I am jealous. I should probably be ashamed of myself that I am not happier for him.
If my math is correct that means your brother has roughly $545,000 invested in Tesla stock. Unless he is an options guy.
Not sure, but he is straight with me. If he says he made 54K, yes, he made 54K. He's a physician (married to another physician) and has deep pockets so it is entirely possible that he's got that kind of money in TSLA or dabbles in options (he's a gambler).
I was just trying to point out the size of the investment required for the gain. Looks like Tesla is up almost another 4.5% in after hours trading.
Well, I'm gonna smack him really hard if he tells me about it.... J/K.

I am not surprised at all. In fact, at Thanksgiving, when TSLA was in the 200s (I believe) he was pushing me to buy it. Said he'd pay for 50 shares as Christmas present for my son with autism. UGH. I can't believe I passed up on it.
Classic narcissist! If your brother was so well meaning he either could have outright gifted the shares to your son at the time without running it past you OR he could gift them from his holdings now. Has that happened? Only someone with those tendencies make the braggart comments. Even more scary is the thought that a physician is gambling, what else does he gamble with? Hmm? Emotions?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

Grt2bOutdoors wrote: Mon Jul 06, 2020 9:46 pm
Zillions wrote: Mon Jul 06, 2020 8:48 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:46 pm
Zillions wrote: Mon Jul 06, 2020 8:40 pm
TheTimeLord wrote: Mon Jul 06, 2020 8:38 pm

If my math is correct that means your brother has roughly $545,000 invested in Tesla stock. Unless he is an options guy.
Not sure, but he is straight with me. If he says he made 54K, yes, he made 54K. He's a physician (married to another physician) and has deep pockets so it is entirely possible that he's got that kind of money in TSLA or dabbles in options (he's a gambler).
I was just trying to point out the size of the investment required for the gain. Looks like Tesla is up almost another 4.5% in after hours trading.
Well, I'm gonna smack him really hard if he tells me about it.... J/K.

I am not surprised at all. In fact, at Thanksgiving, when TSLA was in the 200s (I believe) he was pushing me to buy it. Said he'd pay for 50 shares as Christmas present for my son with autism. UGH. I can't believe I passed up on it.
Classic narcissist! If your brother was so well meaning he either could have outright gifted the shares to your son at the time without running it past you OR he could gift them from his holdings now. Has that happened? Only someone with those tendencies make the braggart comments. Even more scary is the thought that a physician is gambling, what else does he gamble with? Hmm? Emotions?
No, he's not a narcissist. And this is not about him but my emotions. It's about why I feel so bad about not investing in TSLA when I still had the chance. And he didn't call to "rub it in" but to tell me that he thinks TSLA has potential and if I still felt like I didn't want to buy it.
bo105954027
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by bo105954027 »

I wish I’d put in more in NASDAQ during market recovery... which doesn’t go against diversification rule while performed much better than total market.
Time in market beats timing the market.
Frasier2020
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Frasier2020 »

dodecahedron wrote: Mon Jul 06, 2020 8:50 pm I had not looked at TSLA for a while. My late husband generally stuck to passive index investing but he made a special exception for TSLA and bought a significant chunk at $38 in early 2013. He found it fascinating and exciting to watch it go up in the next few months and even bought some options in it, which he cashed out for a significant gain, and then died unexpectedly of a heart attack. (No idea if there was any causal connection, but the association between his profitable dabbling in TSLA and his death are very much linked in my mind.) Although he made money on the options position, he told me that he did not like the way it made him feel--he said about 10 days before his death that he could feel his heart racing. He said he would not be doing any more options trades but would hang onto the TSLA stock and consider selling when it hit $200. (I think it was close to $100 when he said this.) So he still had the TSLA stock in his Roth IRA when he died.

It took a few months for me to get access to all his accounts after his death. TSLA continued to rise during that time. But I found the whole position stressful. I can´t remember exactly what I sold it for, maybe around $140, about a tenth of its price today.

No regrets whatsoever!

I would not have wanted all the stress of hanging onto it over the last seven years. And wondering today, ¨Should I sell today or hang on later.¨

I do not need that kind of stress in my life. The incremental ¨utility" from the additional wealth would not have been worth all the stress.

Very contented to have a hard and fast rule in my IPS: no individual stocks!
Sorry for your loss.

Your post pretty much sums up my sentiments about individual stock ownership. There is an inherent stress from owing a big chunk of individual stocks that I have no interest in dealing with, it's better to have a good nights sleep than have the constant worry knowing one company can tank unexpectedly for a variety of reasons.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by FrugalInvestor »

No, I feel like I'm way ahead of the game because I have a 3 minus 1 fund portfolio (2-fund). I know that I have big ups and downs within the equity portion of my portfolio every day but I don't see them which helps me sleep very well at night and keeps me from wanting to do anything. When anyone tells me about a stock that performed particularly well on any given day I just say (truthfully)....."I think I have some of that."

I love my portfolio. :D
Have a plan, stay the course and simplify, but most importantly....Ignore the Noise!
teaman
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by teaman »

Yes, I do. The most recent being missing out on the Nvidia and Tesla ride, Tesla more meteoric than Nvidia. I had thought about investing in TSLA several times in 2019 but didn't have the courage to. I know... No guts, No glory.
Last edited by teaman on Tue Jul 07, 2020 8:04 am, edited 1 time in total.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by geerhardusvos »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
The only time I’ve ever felt like I missed out, was because I hesitated to invest everything I could afford to invest as early as I could in the three fund portfolio. Otherwise, I’m fully happy with the market returns
VTSAX and chill
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Zillions
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Zillions »

geerhardusvos wrote: Mon Jul 06, 2020 10:15 pm
Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound? My brother made a killing in TSLA just today. Our portfolio is going to be up as well, of course, but not likely to the extent that he (brother) is. I would never take that kind of risk but admittedly am a bit jealous that he made a small fortune today.

Anyone else?

Thanks.
The only time I’ve ever felt like I missed out, was because I hesitated to invest everything I could afford to invest as early as I could in the three fund portfolio. Otherwise, I’m fully happy with the market returns
Love your signature tag! VTSAX & Chill!
tiburblium
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by tiburblium »

I don’t worry about missing out, but I do worry about joining in. I would be a bit worried about him.

Your Brother took an elevates risk and it paid off, maybe it will payoff tomarrow too. The question is, what is his long term plan? Sell everything and revert to a balanced, diversified portfolio for the rest of his life? Or, will this outcome further increase his confidence and convince him make bigger bets next time? And after that?
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dodecahedron
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by dodecahedron »

Zillions wrote: Mon Jul 06, 2020 8:53 pm I guess what shakes me up about this is that I thought I was fully committed to the 3-fund portfolio - I turned down his offer to buy my son TSLA shares as a Christmas present. But apparently I am not as committed as I thought if the stock's moves makes me question if I did the right thing. I guess that's the issue here - am I really as Bogleheaded as I pretend to be?
Consider what might have happened if you HAD accepted your brother´s offer to buy some TSLA for your son.

So it is July 6 with market closing less than an hour away and TSLA is way up. I´ll assume you have financial guardianship of your son´s assets. You would have been faced with the following decision. Do you sell your son´s shares to lock in the gain today AND face a large kiddie tax that would eat up a good chunk of the gain thus far? Or do you hang on to the shares until they have met the one-year-plus-one-day holding period to qualify for the somewhat lower but still substantial kiddie tax LTCG rate. But what if the stock tanks by then? TSLA is notoriously volatile. Do you hold on still longer in the hopes of more appreciation?

As for your jealousy of brother: keep in mind that it is only a *paper* gain until he actually cashes out his investment. But he sounds as if he thinks it may still go higher. So maybe he will hold on in hopes of further growth. But maybe he is completely wrong and the stock will tank.

Consider yourself lucky you are not faced with either of these dilemmas. :D
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by retired@50 »

Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound?
Not me. I simply don't have the gambler's mentality or nerves sufficient to do what he does. It's like being jealous of Evil Knievel or a high wire acrobat. It never even enters my head to try something like that. People who can do this sort of thing and not lose sleep are just wired differently, or at least differently than I am.

What I like missing out on are high fees, AUM charges, and other rip-offs that are so prevalent in the financial industry.

Regards,
This is one person's opinion. Nothing more.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by RocketShipTech »

retired@50 wrote: Mon Jul 06, 2020 11:30 pm
Zillions wrote: Mon Jul 06, 2020 7:57 pm Hello Everyone,

Does anyone worry about "missing out" because you are only invested in the 3-fund portfolio and hot tips abound?
Not me. I simply don't have the gambler's mentality or nerves sufficient to do what he does. It's like being jealous of Evil Knievel or a high wire acrobat. It never even enters my head to try something like that. People who can do this sort of thing and not lose sleep are just wired differently, or at least differently than I am.

What I like missing out on are high fees, AUM charges, and other rip-offs that are so prevalent in the financial industry.

Regards,
To each his own. Because of my gambling instincts I am on track to be “retired@40”.
SevenBridgesRoad
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by SevenBridgesRoad »

Zillions, you have a large number of interesting threads and posts all very recently. I especially like the grandmother and cousin thread you started.
Affable at 50
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by Affable at 50 »

The Random Walk Down Wall Street By Burton Malkiel is an excellent book. Another that comes to my mind when reading this thread is William J Bernstein’s The Four Pillars of Investing. The sections covering the history of manias helps keep me grounded at times like these.

Here is the description of the book I see when I just looked it up on Amazon:

This down-to-earth book lays out in easy-to-understand prose the four essential topics that every investor must master: the relationship of risk and reward, the history of the market, the psychology of the investor and the market, and the folly of taking financial advice from investment salespeople.

I’ll admit to sometimes having a gamblers itch. I spend less time with envy at this stage of my life. What I appreciate the most when I feel like I missed out on some investment is that in the long run I have simple portfolio that will help me reach my goals by the time I want to or need to retire. I sleep well at night knowing that my decisions on investing are well informed by the lessons I have learned by reading/listening to several books on investing, including many of the books on the suggested reading list. I also appreciate the down to earth and practical advice found on the Bogleheads Forum.

Will Tesla be the next Amazon or Google or Apple? I don’t know. Is there a chance it is the next Tulip Bulb? I don’t know. What I do know is that my simple portfolio is the surest way to get a fair share of market returns as long as I stay the course.
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Re: Do you ever feel you've missed out due to the 3-fund portfolio?

Post by dcabler »

I'm not a 3-funder and don't feel like I missed out on anything vs. any other portfolio.

Look, there are an infinite number of possible portfolios/asset allocations out there. After a lot of study, I picked something that is low cost that I can live with. The only question that matters is whether it, and more importantly, my savings rate, will allow me to meet my goals. It's not important whether my choices outperform or underperform somebody else's choice or even somebody else's idea of what a baseline portfolio should be. I don't do that with any other part of my life, why should I do that with my investments?

Cheers
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