Did you ever "win" big?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
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Will do good
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Re: Did you ever "win" big?

Post by Will do good » Fri Jan 11, 2019 6:46 pm

MotoTrojan wrote:
Fri Jan 11, 2019 3:50 pm
Will do good wrote:
Fri Jan 11, 2019 4:33 am
Brought APPL about a year before Steve Job returns at around $3.25
And then...?
Sold half 2 years ago when I retired, still have the other half.
It had few splits and a nice little run up since than.

Hockey10
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Re: Did you ever "win" big?

Post by Hockey10 » Fri Jan 11, 2019 7:03 pm

RickBoglehead wrote:
Fri Jan 11, 2019 6:31 am
Yes. 40 years I met my wife, married her 38 years ago.

Most who "won big" on a stock lost more on other stocks.

I sold Amazon at $20 after years and years of waiting. That showed me to never invest in individual stocks again.
Same as Rick with having a great wife, but he is about 8 years ahead of me. :D

On the stock side, I hit a few homers with companies such as Lockheed Martin and Abbott Labs (and the resulting spinoff to Abbvie), :sharebeer but I did lose 95% of my investment in PALM around the turn of the century. :(

spth
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Re: Did you ever "win" big?

Post by spth » Fri Jan 11, 2019 7:29 pm

We put a large amount in solo 401k last February. We forgot to invest it. Fund dropped 18% from then until now. Oops.

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fortyofforty
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Re: Did you ever "win" big?

Post by fortyofforty » Fri Jan 11, 2019 7:35 pm

Bought a small position of a stock at $13 per share. Watched it every day. Tracked it up and down and up. In the low 20s, all the experts agreed it was not only fully-valued but overvalued, as it had no earnings. I got out then, and it was the last individual stock I ever owned. Wish I had held onto Amazon. :oops: I did learn that individual stock investing was not for me, eventually ending up primarily in index funds.
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JamalJones
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Re: Did you ever "win" big?

Post by JamalJones » Fri Jan 11, 2019 8:08 pm

DA200 wrote:
Fri Jan 11, 2019 1:45 pm
Bought 100 shares of Amazon for $6,000 in 1999.
Still holding and now worth $164,000.
This is the only individual stock that we own and never plan to buy individual stocks again!
My mom sold this house to this one woman who paid cash for it. This woman felt the need to explain how she could do that. Apparently, according to my mom, some random dude - in 1997 - told her to buy Amazon because, she was a librarian and into books and Amazon sold books online so she should invest (kind of a weird non sequitur-ish advice huh? "You use your feet for walking right? You should invest in this shoe company!" "You eat food right? You should buy stock in Campbell's soup and Kroger!").

Anyway he had told her this because she had just inherited a $100K and didn't know what to do with it. So this guy told her about Amazon. I don't know how much she put into it.....but my mom said she paid cash for a $1.1 million house. So....yeah, probably has a lot of $$$ worth of Amazon stock still.......
TSP + Vanguard Roth IRA + Vanguard Taxable: 80% equities / 20% bonds | Yap, yap, yap, yap, - the bottom line is ya gotta buckle up the chin strap!

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Sasquatch
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Re: Did you ever "win" big?

Post by Sasquatch » Fri Jan 11, 2019 9:56 pm

It’s been forever ago. In the early 90s was loading the floppy disc called DOS on the computer to use it. Then Quattro 1-2-3 then this thing called Microsoft Excel came along and it worked great for stuff I was doing at work.

I bought $5k ish of MSFT. Sold for $15k ish to buy our first house. Super exciting to buy our first house with 20% down. Never had to pay PMI on any house because of MSFT.

I’ve got 3 or 4 losing stories to offset every winner though. LOL!

I stopped buying individual stocks when I was holding. IDTI, AMAT, and MU in 2000

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arcticpineapplecorp.
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Re: Did you ever "win" big?

Post by arcticpineapplecorp. » Fri Jan 11, 2019 10:06 pm

fire4fun wrote:
Fri Jan 11, 2019 12:01 pm
Watty wrote:
Fri Jan 11, 2019 6:54 am
aristotelian wrote:
Fri Jan 11, 2019 6:17 am
I've had a few winners but they were more than cancelled out by losers.
+1

One of the big problems with stock picking is that if you pick 20 stocks then just by dumb luck a couple of them will do much better than the stock market.

I have also gone to the horse races and bet on a dozen races and won a couple.
The thing about life is, sometimes you just need 1 or 2 big wins, and you never have to work again. You've won. Haters will say "got lucky" because that's all they could say. They never took action so they are stuck rationalizing their own life and decisions.
1 or 2 big wins? That sounds like the lottery. Oh right, buying individual stocks is the same as playing the lottery. Why? Because only 4% of all the companies back to 1926 created all the value of the stock market (they weren't always the same companies). 50% of the companies in the stock market back to 1926 however underperformed riskless treasuries. Don't take my word for it:
Most common stocks do not outperform Treasury Bills. Fifty eight percent of common stocks have holding period returns less than those on
one-month Treasuries over their full lifetimes on CRSP. When stated in terms of lifetime dollar wealth creation, the entire gain in the U.S. stock
market since 1926 is attributable to the best-performing four percent of listed stocks.
source: https://csinvesting.org/wp-content/uplo ... -Bills.pdf
Stop searching for the needle in the haystack and own the haystack instead.

If that's not enough for you, take the words of author and fellow boglehead William Bernstein to heart:
“...concentrating your portfolio in a few stocks maximizes your chances of getting rich. Unfortunately, it also maximizes your chance of
becoming poor. Owning the whole market—indexing—minimizes your chances of both outcomes by guaranteeing you the market return.” (The Four Pillars of Investing by William Bernstein, pg. 102).
Stop playing with your money.
"Invest we must" | "By God, If John Q. Public doesn't get the word after two Swedroe books, two (Bill) Bernstein books, and four Bogle books, he (she) has only himself to blame!"

HIinvestor
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Re: Did you ever "win" big?

Post by HIinvestor » Fri Jan 11, 2019 10:31 pm

H was a fed employee—that was a big win and he worked with the fed govt 45 years. We met and married over 30 years ago, another big win.

His employer had a deferred compensation plan he could invest in, up to 10% of his lifetime earnings with after tax dollars. We guesstimated lifetime fed earnings and put in the max just before he retired and rolled it over into a Roth IRA. We have invested the Roth IRA well and it’s now about 4x what we started with in 2012.

His employer gave him two options for retirement—stick with the CSRS pension he started with in the 1960s or switch to the “new and improved 1980s+ FERS pension.” He stuck with the old CSRS pension and it supports our retirement living expenses very comfortably!

The wins described above did better for us than any stock pick, hands down!

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Cosmo
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Re: Did you ever "win" big?

Post by Cosmo » Fri Jan 11, 2019 10:52 pm

My son was born in early 2009 -2 months premature and was in serious condition. As you can imagine, it was a tough time for parents. His grandparents gave us a nice chunk of money to start a 529 plan. With all of the stress and anxiety, I didn't get around to doing it right away but I finally opened an account and funded it with his grandparents money, along with our own into a Vanguard Total Market Index fund. It wasn't until many months later that I realized that the 529 plan got funded on March 9, 2009, the day the S&P 500 reached the bottom. No skill involved; just a happy accident.

Cosmo

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Davinci
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Re: Did you ever "win" big?

Post by Davinci » Fri Jan 11, 2019 10:54 pm

Yes when I found Bogleheads. :beer

Cheers,
" Simplicity is the ultimate sophistication" Leonardo Da Vinci.

FOGU
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Re: Did you ever "win" big?

Post by FOGU » Fri Jan 11, 2019 11:13 pm

Bought Amazon some years ago, 22 shares for a total investment of about $5k. As of today they are worth $36k.

Trying to decide whether to sell, and if I sell how to avoid/defer the taxes. Kind of a little trick box I'm in here.
~ Don't just do something. Sit there. ~

Darwin
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Re: Did you ever "win" big?

Post by Darwin » Sat Jan 12, 2019 12:11 am

GoldStar wrote:
Fri Jan 11, 2019 3:45 pm
Bacchus01 wrote:
Fri Jan 11, 2019 9:50 am
I met my wife
Your wife was a stock pick?
I heard an NPR financial discussion years ago where they suggested that your choice of partner (and whether you stick with him/her) might be one of the biggest indicators of your future financial success. 😉
No planet, no business. Earth bats last.

hilink73
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Re: Did you ever "win" big?

Post by hilink73 » Sat Jan 12, 2019 1:40 am

Does crypto count, or would that be in the BIG BIG thread? :mrgreen:

fire4fun
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Re: Did you ever "win" big?

Post by fire4fun » Sat Jan 12, 2019 2:02 am

arcticpineapplecorp. wrote:
Fri Jan 11, 2019 10:06 pm
fire4fun wrote:
Fri Jan 11, 2019 12:01 pm
Watty wrote:
Fri Jan 11, 2019 6:54 am
aristotelian wrote:
Fri Jan 11, 2019 6:17 am
I've had a few winners but they were more than cancelled out by losers.
+1

One of the big problems with stock picking is that if you pick 20 stocks then just by dumb luck a couple of them will do much better than the stock market.

I have also gone to the horse races and bet on a dozen races and won a couple.
The thing about life is, sometimes you just need 1 or 2 big wins, and you never have to work again. You've won. Haters will say "got lucky" because that's all they could say. They never took action so they are stuck rationalizing their own life and decisions.
1 or 2 big wins? That sounds like the lottery. Oh right, buying individual stocks is the same as playing the lottery. Why? Because only 4% of all the companies back to 1926 created all the value of the stock market (they weren't always the same companies). 50% of the companies in the stock market back to 1926 however underperformed riskless treasuries. Don't take my word for it:
Most common stocks do not outperform Treasury Bills. Fifty eight percent of common stocks have holding period returns less than those on
one-month Treasuries over their full lifetimes on CRSP. When stated in terms of lifetime dollar wealth creation, the entire gain in the U.S. stock
market since 1926 is attributable to the best-performing four percent of listed stocks.
source: https://csinvesting.org/wp-content/uplo ... -Bills.pdf
Stop searching for the needle in the haystack and own the haystack instead.

If that's not enough for you, take the words of author and fellow boglehead William Bernstein to heart:
“...concentrating your portfolio in a few stocks maximizes your chances of getting rich. Unfortunately, it also maximizes your chance of
becoming poor. Owning the whole market—indexing—minimizes your chances of both outcomes by guaranteeing you the market return.” (The Four Pillars of Investing by William Bernstein, pg. 102).
Stop playing with your money.
That lottery comparison is brought up so often on here like it's going out of style. The odds of winning the lottery is one in hundreds of millions. And you have no control over the outcome.

The odds of having a big win like a very successful business or investment that makes you very rich is much much more common. Plus, the latter can be controlled through hard work, genetics, disposition, and research. That comparison is so far off the mark it's actually laughable.

hilink73
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Re: Did you ever "win" big?

Post by hilink73 » Sat Jan 12, 2019 2:41 am

fire4fun wrote:
Sat Jan 12, 2019 2:02 am
Plus, the latter can be controlled through ..., genetics, ..., and ....
But how?
Using gene editing on oneself to become more intelligent or what?

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arcticpineapplecorp.
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Re: Did you ever "win" big?

Post by arcticpineapplecorp. » Sat Jan 12, 2019 10:02 am

fire4fun wrote:
Sat Jan 12, 2019 2:02 am
That lottery comparison is brought up so often on here like it's going out of style. The odds of winning the lottery is one in hundreds of millions. And you have no control over the outcome.

The odds of having a big win like a very successful business or investment that makes you very rich is much much more common. Plus, the latter can be controlled through hard work, genetics, disposition, and research. That comparison is so far off the mark it's actually laughable.
If that were true then why isn't everyone rich?
If that were true why doesn't everyone beat the market?
If that were true why did most hedge funds grossly underperform the market over the past 10-15 years when the "odds" (as you say) of picking successful investments are so "common"? source: https://www.google.com/search?client=fi ... derperform

Finally, I think you downplay the role that luck plays in life. Most of the most successful people I've heard interviewed all attributed their success in some part or another to luck. Yes they had to be smart, talented, etc. but there are plenty of examples where those are necessary but not sufficient conditions for success.

I think it's far more dangerous to roll out a trope that it's easy to pick big winners in the stock market than to believe picking stocks is like trying to play the lottery. I would much rather show the evidence of how to build wealth over time than rely on anecdotal evidence. By the way, it's not just my opinion:

source: https://www.google.com/search?client=fi ... RXF2P2gS1w

The first point is that picking stocks might have "slightly" better odds than the lottery but:
The good news: Yes, buying one stock gives you better odds than buying a lottery ticket.

The bad news: Those "better" odds are still much too awful to stake your future on.
source: https://www.marketwatch.com/story/why-p ... 2017-06-28
Stop playing "The Loser's Game".
"Invest we must" | "By God, If John Q. Public doesn't get the word after two Swedroe books, two (Bill) Bernstein books, and four Bogle books, he (she) has only himself to blame!"

Valuethinker
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Re: Did you ever "win" big?

Post by Valuethinker » Sat Jan 12, 2019 10:16 am

Cosmo wrote:
Fri Jan 11, 2019 10:52 pm
My son was born in early 2009 -2 months premature and was in serious condition. As you can imagine, it was a tough time for parents. His grandparents gave us a nice chunk of money to start a 529 plan. With all of the stress and anxiety, I didn't get around to doing it right away but I finally opened an account and funded it with his grandparents money, along with our own into a Vanguard Total Market Index fund. It wasn't until many months later that I realized that the 529 plan got funded on March 9, 2009, the day the S&P 500 reached the bottom. No skill involved; just a happy accident.

Cosmo
You mean don't you that Princeton University 2027 just got lucky, rather than you and your son ?

(Or maybe Podunk U)

;-) ;-)

Valuethinker
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Re: Did you ever "win" big?

Post by Valuethinker » Sat Jan 12, 2019 10:19 am

Darwin wrote:
Sat Jan 12, 2019 12:11 am
GoldStar wrote:
Fri Jan 11, 2019 3:45 pm
Bacchus01 wrote:
Fri Jan 11, 2019 9:50 am
I met my wife
Your wife was a stock pick?
I heard an NPR financial discussion years ago where they suggested that your choice of partner (and whether you stick with him/her) might be one of the biggest indicators of your future financial success. 😉
We might start calling it the "Bezos tax" given that is likely to be the biggest divorce cost since Henry VIII and Catherine of Aragon.

That latter cost the Pope one of his richest countries and led to the dissolution of monasteries that owned over one quarter of all the land in England.

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nedsaid
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Re: Did you ever "win" big?

Post by nedsaid » Sat Jan 12, 2019 10:26 am

Plum Creek Timber, Exxon-Mobil, Fannie Mae are three successful picks I can think of. Still own shares in the successor company to Plum Creek and still own Exxon-Mobil. Sold Fannie Mae when things were still going good, I paid attention when Warren Buffett sold his stake in Freddie Mac, a very similar company. I think of Plum Creek as probably my best ever stock. StanCorp might actually have been the best, I made probably 9X my original investment over 16 years.
A fool and his money are good for business.

sillysaver
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Re: Did you ever "win" big?

Post by sillysaver » Sat Jan 12, 2019 10:29 am

Skyccord wrote:
Thu Jan 10, 2019 10:15 pm
I know we live in the world of a 3 fund portfolio. But my question is did you ever have a stock pick that paid you a very handsome return?
No, never, not in stocks. The best trades I ever made were 100%-200%, but those are pretty rare.

In real estate it's a different story. All my big investment wins were in real estate.

Valuethinker
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Re: Did you ever "win" big?

Post by Valuethinker » Sat Jan 12, 2019 10:41 am

arcticpineapplecorp. wrote:
Sat Jan 12, 2019 10:02 am
fire4fun wrote:
Sat Jan 12, 2019 2:02 am
That lottery comparison is brought up so often on here like it's going out of style. The odds of winning the lottery is one in hundreds of millions. And you have no control over the outcome.

The odds of having a big win like a very successful business or investment that makes you very rich is much much more common. Plus, the latter can be controlled through hard work, genetics, disposition, and research. That comparison is so far off the mark it's actually laughable.
If that were true then why isn't everyone rich?
If that were true why doesn't everyone beat the market?
If that were true why did most hedge funds grossly underperform the market over the past 10-15 years when the "odds" (as you say) of picking successful investments are so "common"? source: https://www.google.com/search?client=fi ... derperform

Finally, I think you downplay the role that luck plays in life. Most of the most successful people I've heard interviewed all attributed their success in some part or another to luck. Yes they had to be smart, talented, etc. but there are plenty of examples where those are necessary but not sufficient conditions for success.

I think it's far more dangerous to roll out a trope that it's easy to pick big winners in the stock market than to believe picking stocks is like trying to play the lottery. I would much rather show the evidence of how to build wealth over time than rely on anecdotal evidence. By the way, it's not just my opinion:

source: https://www.google.com/search?client=fi ... RXF2P2gS1w

The first point is that picking stocks might have "slightly" better odds than the lottery but:
The good news: Yes, buying one stock gives you better odds than buying a lottery ticket.

The bad news: Those "better" odds are still much too awful to stake your future on.
source: https://www.marketwatch.com/story/why-p ... 2017-06-28
Stop playing "The Loser's Game".
One has Agency in ones own life.

This is bounded by parents and their financial and educational status. By your genes and your health etc.

On stock investing one does not

The best evidence for efficient markets is that there are not fund managers with sustained outperformance.

The ones that are, like Buffett, are even fewer than statistics would predict. And Buffett himself is emphatic about being born at the right time and the right place.

All one can do is restrain current consumption in favour of future investment and take a long patient view of investing. Accepting that there will be bad decades like the 1970s and hoping there are not bad 30 year periods like miodern Japan.

And use low cost index funds to exploit market efficiency.

In those respects one has Agency.

Better to concentrate ones energies on ones career or developing a personal business etc.

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Bulldawg
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Re: Did you ever "win" big?

Post by Bulldawg » Sat Jan 12, 2019 11:13 am

Although a very small percentage of my holdings , Berkshire & Warren Buffett have provided a nice ROI over the years . Most of our equity is in 2 fund indexes, RE, and personal businesses , but it's been fun watching Berkshire increase in value and reading WB's annual reports.
Last edited by Bulldawg on Sat Jan 12, 2019 11:24 am, edited 1 time in total.
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F150HD
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Re: Did you ever "win" big?

Post by F150HD » Sat Jan 12, 2019 11:23 am

RickBoglehead wrote:
Fri Jan 11, 2019 6:31 am
Yes. 40 years I met my wife, married her 38 years ago.

Most who "won big" on a stock lost more on other stocks.

I sold Amazon at $20 after years and years of waiting. That showed me to never invest in individual stocks again.
Ouch.

There is a thread here of someone who bought Netflix waaaay back when....and their dad encouraged them to sell it when it was still really low....and they did. :(
Last edited by F150HD on Sat Jan 12, 2019 11:23 am, edited 1 time in total.

FireProof
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Re: Did you ever "win" big?

Post by FireProof » Sat Jan 12, 2019 11:23 am

Bay Area real estate

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F150HD
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Re: Did you ever "win" big?

Post by F150HD » Sat Jan 12, 2019 11:27 am

sleepysurf wrote:
Fri Jan 11, 2019 7:55 am
As a fledgling investor in the late 90's, I bought Munder NetNet Fund, and it tripled over the next year. I cashed out just before it's historic decline. Thinking I was an investing genius, I put all my earnings into the PALM IPO. Years later I finally learned the difference between investing and speculating!
PALM was a great phone, I loved it, so tiny, absolutely awesome. BUT, I also recall being out of town w/ friends and the phone literally died on the spot. Pretty frustrating. Never went back, and of course they disappeared. I prob still have the phone at the house if you want it :happy

Bacchus01
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Re: Did you ever "win" big?

Post by Bacchus01 » Sat Jan 12, 2019 12:37 pm

GoldStar wrote:
Fri Jan 11, 2019 3:45 pm
Bacchus01 wrote:
Fri Jan 11, 2019 9:50 am
I met my wife
Your wife was a stock pick?

More valuable than any stock pick. Way more.

fire4fun
Posts: 91
Joined: Tue Dec 25, 2018 2:29 am

Re: Did you ever "win" big?

Post by fire4fun » Sat Jan 12, 2019 1:15 pm

arcticpineapplecorp. wrote:
Sat Jan 12, 2019 10:02 am
fire4fun wrote:
Sat Jan 12, 2019 2:02 am
That lottery comparison is brought up so often on here like it's going out of style. The odds of winning the lottery is one in hundreds of millions. And you have no control over the outcome.

The odds of having a big win like a very successful business or investment that makes you very rich is much much more common. Plus, the latter can be controlled through hard work, genetics, disposition, and research. That comparison is so far off the mark it's actually laughable.
If that were true then why isn't everyone rich?
If that were true why doesn't everyone beat the market?
If that were true why did most hedge funds grossly underperform the market over the past 10-15 years when the "odds" (as you say) of picking successful investments are so "common"? source: https://www.google.com/search?client=fi ... derperform

Finally, I think you downplay the role that luck plays in life. Most of the most successful people I've heard interviewed all attributed their success in some part or another to luck. Yes they had to be smart, talented, etc. but there are plenty of examples where those are necessary but not sufficient conditions for success.

I think it's far more dangerous to roll out a trope that it's easy to pick big winners in the stock market than to believe picking stocks is like trying to play the lottery. I would much rather show the evidence of how to build wealth over time than rely on anecdotal evidence. By the way, it's not just my opinion:

source: https://www.google.com/search?client=fi ... RXF2P2gS1w

The first point is that picking stocks might have "slightly" better odds than the lottery but:
The good news: Yes, buying one stock gives you better odds than buying a lottery ticket.

The bad news: Those "better" odds are still much too awful to stake your future on.
source: https://www.marketwatch.com/story/why-p ... 2017-06-28
Stop playing "The Loser's Game".
Answer to your first question. Most people aren't willing to work hard, sacrifice, be creative, go against the grain, and take risks.

Your statement makes no sense. I said its MUCH more common than winning the lottery. If winning the lottery is 1 in 100,000,000, that is 0.00000001%. If "winning big" is becoming wealthy in less than 30 years, and the chance of that is say 1.0%, that is MUCH MUCH more common than winning the lottery, invalidating your comparison by a mile.

Exaggerated and outlandish claims that can be easily proven by statistics only weaken your argument in this case.

2nd point, which you've conveniently chosen to ignore. You have NO CONTROL over winning the lottery. Percent chances aside. I have control of making a lot of money in a shorter period of time or having 1 or 2 big wins. I can surround myself with the right people, I can meditate and go to the gym which will help me make more rational decisions, I can read books and expand my knowledge, and I can learn from failure so that I can do better next time.

If you want to become "kind of wealthy" and plan for taking 30-40 years to do so, fine by me and I salute you. That is in my humble opinion, mediocre, at best. Money earlier (earlier in time and earlier in life) is always better. Time value of money. Look it up. $1 today is better than $2 30 years from now.

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sleepysurf
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Re: Did you ever "win" big?

Post by sleepysurf » Sat Jan 12, 2019 2:07 pm

F150HD wrote:
Sat Jan 12, 2019 11:27 am
PALM was a great phone, I loved it, so tiny, absolutely awesome...
You probably had the Palm Treo. I had the original Palm Pilot 1000, and virtually every PDA and phone iteration after (including the WebOS Pre). Even though I lost my shirt on the Palm stock, I still "won big" as I ended up marrying the woman that I sold my original Palm Pilot to! Of note, a small company recently bought the Palm trademark, and is now selling a truly tiny "companion" Palm phone (running Android OS) exclusively on Verizon... https://www.theverge.com/2018/10/15/179 ... nt-verizon
Retired 2018 | ~50/45/5 (partially sliced and diced)

garlandwhizzer
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Re: Did you ever "win" big?

Post by garlandwhizzer » Sat Jan 12, 2019 2:46 pm

Yes, I did back in the tech boom running up to 2000. Back then I only bought individual stocks and only 2. In 1992 I bought $40K of CSCO and 20K of INTC. My entire portfolio was only those 2 stocks, no bonds. CSCO split so many times that my adjusted buy price got to $1.17/share and it went up to over $70/share in 8 years, a return of about 60 times my original investment. At that time CSCO paid no dividends so I paid no taxes along the way and at the end had $ 2.4 million dollars from CSCO alone, not to mention INTL which also skyrocketed. I bought these 2 because of my girlfriend at the time who was the VP of Smith Barney in charge of analyzing tech stocks. She was brilliant (degrees from Brown and Stanford in economics and electrical engineering) and understood both the stock market and the fine details of tech. She thoroughly understood where tech was going in the future long before the financial industry did. Then, as now, stock analysis was centered in NYC which at the time did not have a clue about Silicon Valley's potential for explosive earnings growth in the decades ahead. I was in the Bay Area at the time and had contacts in the high tech arena which also helped.

However, having made a fortune I mistook an ever inflating tech bubble for my own investing genius and was convinced I was an incredibly astute investor. I managed in subsequent years of stock picking to lose millions. Fortunately I had made more millions than I lost and was able to retire comfortably at age 50. After it was all over, I gained a measure of investing wisdom and stuck with low cost broadly diversified index funds where I remain today. Markets were much less efficient in the 1990s than now and getting outsized gains from astute stock analysis was a real possibility then, very unlikely now. I believe that most investors who employ individual stock picking or other short cuts to wealth these days will lose in the end and wind up in the same place that I am in now, index funds.

Garland Whizzer

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arcticpineapplecorp.
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Re: Did you ever "win" big?

Post by arcticpineapplecorp. » Sat Jan 12, 2019 3:11 pm

fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Answer to your first question. Most people aren't willing to work hard, sacrifice, be creative, go against the grain, and take risks.
Two counterpoints to this illogical argument:
1. How do you explain the average hedge fund manager who underperformed the market over the past 15 years (links already provided)? Don't these fine folks meet all your definers above (work hard, sacrifice, be creative, go against the grain and take risks)???
2. so by your logic, anyone who never picked a winning stock that could have made them rich has never worked hard, never sacrificed, is not creative, never went against the grain and never took a risk? Do I have that right?
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Your statement makes no sense. I said its MUCH more common than winning the lottery. If winning the lottery is 1 in 100,000,000, that is 0.00000001%. If "winning big" is becoming wealthy in less than 30 years, and the chance of that is say 1.0%, that is MUCH MUCH more common than winning the lottery, invalidating your comparison by a mile.
what were the chances that you:
1. would have picked any of the 4% of stocks that created all the value of the stock market
2. invested enough of your money to have gotten rich.
3. held onto that stock(s) during the bad times (before the good times arrived. Think Apple as an example of this. The company was not a singular upward trajectory over the course of it's entire life. In fact the company was weeks from bankruptcy
sources:
https://thenextweb.com/apple/2010/06/02 ... s-90-days/
https://www.macrumors.com/2011/09/19/st ... -innovate/


Sure there are less companies than lottery tickets and therefore the odds are "better". I didn't say they weren't. I said, well Paul Merriman said:
The good news: Yes, buying one stock gives you better odds than buying a lottery ticket.

The bad news: Those "better" odds are still much too awful to stake your future on.
source: https://www.marketwatch.com/story/why-p ... 2017-06-28
Continue to argue the point if you must.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Exaggerated and outlandish claims that can be easily proven by statistics only weaken your argument in this case.
I linked to a peer reviewed academic paper (Bessembinder's) that refutes your claim that it's "easy" to get rich picking stocks. I cited several links to other respected authors/financial planners/educators (Merriman, Swedroe, Ellis (the loser's game: https://www.ifa.com/pdfs/ellis_charles_ ... e_1975.pdf). I don't see where you've provided any journal articles to do the same. So could it be you're the one making "exaggerated and outlandish claims"? I believe that's called projection. Look that one up.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
2nd point, which you've conveniently chosen to ignore. You have NO CONTROL over winning the lottery. Percent chances aside. I have control of making a lot of money in a shorter period of time or having 1 or 2 big wins. I can surround myself with the right people, I can meditate and go to the gym which will help me make more rational decisions, I can read books and expand my knowledge, and I can learn from failure so that I can do better next time.
I have ignored nothing. You have no control over winning the lottery, there I said it. But the degree to which you believe you have control over how well your stock picks do is what you've chosen to ignore. Your picks do not determine whether or not those stocks do well. There are a host of other factors, most of which will come AFTER you've selected your winning stock, that you will never have seen coming and this will turn your stellar stock into the next dog. It's unknowable. It's unforeseen. The moment you buy a stock because you think it will continue to do as well as it has in the past, that moment is gone. And now the stock is dealing with a new problem you didn't know about before you picked it. You believe you have control but that is just an illusion. That's a fact.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
If you want to become "kind of wealthy" and plan for taking 30-40 years to do so, fine by me and I salute you. That is in my humble opinion, mediocre, at best. Money earlier (earlier in time and earlier in life) is always better. Time value of money. Look it up. $1 today is better than $2 30 years from now.
I'm familiar with the time value of money. I'm also familiar with others who choose to take idiosyncratic and uncompensated risks, and people who don't really track their performance against any benchmark (or the right one to match their overall portfolio) nor compute whether they received a higher risk adjusted return.

You are promoting an idea that is "get rich quick" rather than build wealth slowly. You are disparaging the only known strategy that has a high liklihood of success. You are confusing the return of the market with mediocrity. You are exhibiting hubris rather than humility. Pride cometh before the fall.

You are stuck in the past and following other's who decades ago made the same false arument you're making now (that's been debunked):
Fidelity Chairman Edward C. Johnson led the skeptics, assuring the world that Fidelity had no intention of following Vanguard's lead: "I can't believe that the great mass of investors are going to be satisfied with just receiving average returns. The name of the game is to be the best.
source: https://www.vanguard.com/bogle_site/sp20040413.html
Funny how one of the largest mutual fund companies has gotten the message that owning the market through indexing is what works, but you're still believing in the "old ways" in active management:
Fidelity has been managing index funds for more than 25 years. The company, which is the 2nd largest index mutual fund manager in the industry with more than $216 billion in assets under management,1 now offers 19 Fidelity equity, fixed income and hybrid index mutual funds, 13 Fidelity Freedom® Index Funds, and 12 Fidelity passive ETFs.
https://www.fidelity.com/about-fidelity ... nd-line-up
Oh, one final paper to read:
The Arithmetic of Active Management:
https://web.stanford.edu/~wfsharpe/art/ ... active.htm
"Invest we must" | "By God, If John Q. Public doesn't get the word after two Swedroe books, two (Bill) Bernstein books, and four Bogle books, he (she) has only himself to blame!"

mak
Posts: 133
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Re: Did you ever "win" big?

Post by mak » Sat Jan 12, 2019 3:43 pm

Gave up years ago after losing so much on all these hopeful and lucky bets I saw my life's earnings going down the toilet. A friend in San Diego has been trading for 30 years, with a cumulative loss of over $1m which came from his work earnings. He has a PhD and has been a VP Operations for electronics startups and such. He will not admit that he is a compulsive gambler (my opinion) who has no discipline, and he bristles at the comparison of his activities to gambling. Now, down to his last $200K in an IRA, with the entire taxable account gone, he is doing stock trades and writing options. For 2018 he lost 15%, and he gets very angry if you point out that underperforms simple balanced funds even in a down year.

He explains that in his life he took over divisions of a company where a product was failing due to a seemingly unsolvable engineering problem, how he was hired to attack this problem and attacked it in many different ways, and how he eventually saved the product and the division by making a discovery that every expert previously hired had failed to find. He explains that his 30 years of mostly losing years are part of the learning process, and how he remains sure he will eventually get his system right, constantly refining it, learning from mistakes, and how then, on some glorious day, he will sleep like a baby, and mint money through his trades while others look on in disbelief. He will go to his grave with these beliefs they are part of his being. I do think the IRA money will eventually be all gone, from trading. He lives on Social Security, which I'm sure if he could trade he would do and lose that too. He itches to borrow against his home, recently finally paid off, because that would provide more money for trading. He talks often about moving to a cheaper place to live, again this being to free up home equity which could then be multiplied (divided) with exciting market activities.

He recalls his big wins with glee, and never speaks of losses. Any attempt to point them out is met with anger. Only losers think negatively. Think positive. That big win is right around the corner. He will go to his grave believing this.

This year's resolution is #1 no more options (justification: why pay commissions for them, since I have unlimited stock trades at no commission!), and #2 if at the end of Q1 I have another loss I will quit and admit defeat. When I heard that I said no way, you will not stop, you cannot. You would have nothing to get out of bed for each day, you live to watch the trading screens, watch CNBC, enter the orders. It is your life. You will never quit. He claims otherwise. I get daily emails excited about making $200 this day or that. The daily predictions of what will happen tomorrow, market is now in an uptrend, downtrend, back and fill, you name it seem random to me but to him they are calculated and logical. He will never change.
Last edited by mak on Sat Jan 12, 2019 7:57 pm, edited 1 time in total.

fire4fun
Posts: 91
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Re: Did you ever "win" big?

Post by fire4fun » Sat Jan 12, 2019 3:55 pm

arcticpineapplecorp. wrote:
Sat Jan 12, 2019 3:11 pm
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Answer to your first question. Most people aren't willing to work hard, sacrifice, be creative, go against the grain, and take risks.
Two counterpoints to this illogical argument:
1. How do you explain the average hedge fund manager who underperformed the market over the past 15 years (links already provided)? Don't these fine folks meet all your definers above (work hard, sacrifice, be creative, go against the grain and take risks)???
2. so by your logic, anyone who never picked a winning stock that could have made them rich has never worked hard, never sacrificed, is not creative, never went against the grain and never took a risk? Do I have that right?
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Your statement makes no sense. I said its MUCH more common than winning the lottery. If winning the lottery is 1 in 100,000,000, that is 0.00000001%. If "winning big" is becoming wealthy in less than 30 years, and the chance of that is say 1.0%, that is MUCH MUCH more common than winning the lottery, invalidating your comparison by a mile.
what were the chances that you:
1. would have picked any of the 4% of stocks that created all the value of the stock market
2. invested enough of your money to have gotten rich.
3. held onto that stock(s) during the bad times (before the good times arrived. Think Apple as an example of this. The company was not a singular upward trajectory over the course of it's entire life. In fact the company was weeks from bankruptcy
sources:
https://thenextweb.com/apple/2010/06/02 ... s-90-days/
https://www.macrumors.com/2011/09/19/st ... -innovate/


Sure there are less companies than lottery tickets and therefore the odds are "better". I didn't say they weren't. I said, well Paul Merriman said:
The good news: Yes, buying one stock gives you better odds than buying a lottery ticket.

The bad news: Those "better" odds are still much too awful to stake your future on.
source: https://www.marketwatch.com/story/why-p ... 2017-06-28
Continue to argue the point if you must.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
Exaggerated and outlandish claims that can be easily proven by statistics only weaken your argument in this case.
I linked to a peer reviewed academic paper (Bessembinder's) that refutes your claim that it's "easy" to get rich picking stocks. I cited several links to other respected authors/financial planners/educators (Merriman, Swedroe, Ellis (the loser's game: https://www.ifa.com/pdfs/ellis_charles_ ... e_1975.pdf). I don't see where you've provided any journal articles to do the same. So could it be you're the one making "exaggerated and outlandish claims"? I believe that's called projection. Look that one up.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
2nd point, which you've conveniently chosen to ignore. You have NO CONTROL over winning the lottery. Percent chances aside. I have control of making a lot of money in a shorter period of time or having 1 or 2 big wins. I can surround myself with the right people, I can meditate and go to the gym which will help me make more rational decisions, I can read books and expand my knowledge, and I can learn from failure so that I can do better next time.
I have ignored nothing. You have no control over winning the lottery, there I said it. But the degree to which you believe you have control over how well your stock picks do is what you've chosen to ignore. Your picks do not determine whether or not those stocks do well. There are a host of other factors, most of which will come AFTER you've selected your winning stock, that you will never have seen coming and this will turn your stellar stock into the next dog. It's unknowable. It's unforeseen. The moment you buy a stock because you think it will continue to do as well as it has in the past, that moment is gone. And now the stock is dealing with a new problem you didn't know about before you picked it. You believe you have control but that is just an illusion. That's a fact.
fire4fun wrote:
Sat Jan 12, 2019 1:15 pm
If you want to become "kind of wealthy" and plan for taking 30-40 years to do so, fine by me and I salute you. That is in my humble opinion, mediocre, at best. Money earlier (earlier in time and earlier in life) is always better. Time value of money. Look it up. $1 today is better than $2 30 years from now.
I'm familiar with the time value of money. I'm also familiar with others who choose to take idiosyncratic and uncompensated risks, and people who don't really track their performance against any benchmark (or the right one to match their overall portfolio) nor compute whether they received a higher risk adjusted return.

You are promoting an idea that is "get rich quick" rather than build wealth slowly. You are disparaging the only known strategy that has a high liklihood of success. You are confusing the return of the market with mediocrity. You are exhibiting hubris rather than humility. Pride cometh before the fall.

You are stuck in the past and following other's who decades ago made the same false arument you're making now (that's been debunked):
Fidelity Chairman Edward C. Johnson led the skeptics, assuring the world that Fidelity had no intention of following Vanguard's lead: "I can't believe that the great mass of investors are going to be satisfied with just receiving average returns. The name of the game is to be the best.
source: https://www.vanguard.com/bogle_site/sp20040413.html
Funny how one of the largest mutual fund companies has gotten the message that owning the market through indexing is what works, but you're still believing in the "old ways" in active management:
Fidelity has been managing index funds for more than 25 years. The company, which is the 2nd largest index mutual fund manager in the industry with more than $216 billion in assets under management,1 now offers 19 Fidelity equity, fixed income and hybrid index mutual funds, 13 Fidelity Freedom® Index Funds, and 12 Fidelity passive ETFs.
https://www.fidelity.com/about-fidelity ... nd-line-up
Oh, one final paper to read:
The Arithmetic of Active Management:
https://web.stanford.edu/~wfsharpe/art/ ... active.htm
I don't think picking 1 or 2 stocks is a good idea. We are in agreement there. What I am referring to as 1 or 2 big wins are things like investing in a business which can be your own (not on the stock market), investing in real estate, or your human capital. Those are the things that can help you secure a big win, instead of waiting until you are 65 to have $1-2M in the bank.

I have never bought an individual stock and I've probably more against it than you. So all that you are typing is preaching to the choir.

If I'm going to sacrifice now, I want the rewards soon, in 5 years, and later. Not just later.

Anyone using that lottery agreement sounds like they are giving up and just want to settle for average. They don't think they have it in them to create wealth or have a big win now so they settle for it when they are old.

I believe in the power of crafting your chosen life and destiny. I think having one or two big wins in your thirties and forties that will set you up for life is not only possible, it's very realistic. With the right mindset. I have already done it by age 31 because I didn't want to to settle for average.

You want the option to take a sabbatical, travel, start a new business, work part-time, etc. you can't do any of those if you've decided to contribute your savings into a retirement account and work full time in a job you may or may not like for 30-40 years.

Investing solely in index funds hoping to get the market return and then maybe when you're in your sixties or seventies you can do the things I mentioned above, doesn't interest me. I want control over my life and not be at the whims of the economy or stock market. It may interest you but that's the beauty of life. People are different.

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Spinola
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Re: Did you ever "win" big?

Post by Spinola » Sat Jan 12, 2019 4:52 pm

I won $50 in a slot machine on a cruise ship once first play. :moneybag :mrgreen:
I stopped gambling then.

A small 5 digit inheritance which went into Roth and SEP IRA and savingss. I am overdue :mrgreen: for a big win..

FoolMeOnce
Posts: 472
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Re: Did you ever "win" big?

Post by FoolMeOnce » Sat Jan 12, 2019 4:54 pm

We used to have an advisor who picked many winners, to the point that I have the welcome problem of having to many gains to easily simplify my portfolio. There's definitely survivorship bias, so I don't know the losers.

I've picked three stocks myself (told the advisor to buy). One lost about half its value and was dumped, one has gone about 2.7x in nine years (small amount, still worth <$20k), and one went about 18x in nine years (now enough for a kid's college at today's costs, not including LTCG taxes on just about the whole amount).

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F150HD
Posts: 1948
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Re: Did you ever "win" big?

Post by F150HD » Sat Jan 12, 2019 5:21 pm

sleepysurf wrote:
Sat Jan 12, 2019 2:07 pm
F150HD wrote:
Sat Jan 12, 2019 11:27 am
PALM was a great phone, I loved it, so tiny, absolutely awesome...
You probably had the Palm Treo. I had the original Palm Pilot 1000, and virtually every PDA and phone iteration after (including the WebOS Pre). Even though I lost my shirt on the Palm stock, I still "won big" as I ended up marrying the woman that I sold my original Palm Pilot to! Of note, a small company recently bought the Palm trademark, and is now selling a truly tiny "companion" Palm phone (running Android OS) exclusively on Verizon... https://www.theverge.com/2018/10/15/179 ... nt-verizon
Palm Pixi. It was so tiny that you didn't know you had it in your pocket which was nice. (kinda like the article you linked to) Todays Smartphones, even smaller ones, can be bulky or heavy in a pocket.

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F150HD
Posts: 1948
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Re: Did you ever "win" big?

Post by F150HD » Sat Jan 12, 2019 5:25 pm

fire4fun wrote:
Sat Jan 12, 2019 3:55 pm
Investing solely in index funds hoping to get the market return and then maybe when you're in your sixties or seventies you can do the things I mentioned above, doesn't interest me. I want control over my life and not be at the whims of the economy or stock market. It may interest you but that's the beauty of life. People are different.
So naturally you spend your time on a board dedicated to investing passively in index funds. :confused

Makes one wonder why you're here.

fire4fun
Posts: 91
Joined: Tue Dec 25, 2018 2:29 am

Re: Did you ever "win" big?

Post by fire4fun » Sat Jan 12, 2019 5:39 pm

F150HD wrote:
Sat Jan 12, 2019 5:25 pm
fire4fun wrote:
Sat Jan 12, 2019 3:55 pm
Investing solely in index funds hoping to get the market return and then maybe when you're in your sixties or seventies you can do the things I mentioned above, doesn't interest me. I want control over my life and not be at the whims of the economy or stock market. It may interest you but that's the beauty of life. People are different.
So naturally you spend your time on a board dedicated to investing passively in index funds. :confused

Makes one wonder why you're here.
It's still 15% of my portfolio so of course I want to learn about it. Its not chump change. I'm fully aware that index funds are not something that pays me an income stream but I have other things that take care of that.

Similar to the winning the lottery comment, life is not all black and white. The world and people are complex, there are shades of grey. I have no idea why everything is reduced to an all-or-nothing phenomenon on the internet.

I also spend my time listening to Peter Schiff. I disagree with literally everything he says because everything that comes out of his mouth is negative and spreading fear, and I am a naturally positive person. I still listen to him because I like to get other perspectives. Similar to being on an index fund forum.

If you only spend time with people who agree with you and you are familiar with, high-fiving each other, what are you going to learn in life?

2015
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Re: Did you ever "win" big?

Post by 2015 » Sat Jan 12, 2019 7:50 pm

fire4fun wrote:
Fri Jan 11, 2019 3:23 pm
2015 wrote:
Fri Jan 11, 2019 2:03 pm
fire4fun wrote:
Fri Jan 11, 2019 12:01 pm
Watty wrote:
Fri Jan 11, 2019 6:54 am
aristotelian wrote:
Fri Jan 11, 2019 6:17 am
I've had a few winners but they were more than cancelled out by losers.
The thing about life is, sometimes you just need 1 or 2 big wins, and you never have to work again. You've won. Haters will say "got lucky" because that's all they could say. They never took action so they are stuck rationalizing their own life and decisions.
Actually no. Luck has a very large impact on results in life. There are scores of books out on the subject. The realty of luck (good and bad) has nothing to do with humans categorized by others as a "hater" or judged as "rationalizing". Luck is deeply embedded in all human activity.

This is the issue with people who are led around by their noses by the daily fire hose of disgorged financial "information". They are not as rational as they could be as a result of missing out on the plethora of big picture things related to how life and reality work. The irony is reading and studying widely outside the extremely narrow fields of investing, personal finance, and microeconomics serves to make one much more effective in all three of these areas.
There is a little luck sure. But I firmly believe that people create their own luck. Lots of evidence that this is true as well.

People who find themselves saying "well they got lucky" are usually those that have been timid and played it safe their whole life. I don't want to ever have any regrets that I didn't do/try something because I was afraid.

I also don't want to be the guy that spent 98% of my time reading books, without putting any of the concepts I've learned into action. This is coming from someone that reads a lot. The truth is you can't know everything and can't have all the data before trying something.
No, there is no "little" amount of luck. Life is enmeshed in luck, both good and bad.

I couldn't agree more with the entirety of your last paragraph. No you can't know "everything" but you can know the right things. The cavalcade of daily short-term junk that passes for "information" in the fields of investing, personal finance, and microeconomics is most certainly not among those things. What you can know is how to think, you can know how media of all types is manipulating you and stealing your life by focusing on the short-term that do not make you effective and in fact make you less effective, you can get better at decision making.

When you read the right things, you will automatically put that information into action, right action. I recommend reading the fields of business strategy, historical politics as it relates to humans in the fight for money, power, and agency, the present and future of technology, trends and innovation. I also recommend investing time in studying and understanding complex adaptive systems. Why? Because human beings are CAS, as is investing, personal finance, and economics of all kinds. The fields of gambling, games, sports, biology, physics, engineering, archaeology, systems, neurology, media, mental model construction and a host of others all apply to the effectiveness/ineffectiveness of human decision making.

One prediction that can be made with a high degree of confidence is that "students of investing" are never fishing in the Optimal lake at the Optimal time with the Optimal degree of clarity. They are too busy chasing after the big one that will always get away (Maximization).

SGM
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Re: Did you ever "win" big?

Post by SGM » Sat Jan 12, 2019 8:34 pm

I don't think the market is price efficient. It is possible to beat the market but very difficult to do it consistently. I have had a couple of very big winners and I think they outweigh the losers. Certainly there was an element of luck. Most of my portfolio is in index funds. One of the problems with having big winners is making a decision of when to sell. Once a company stock has had a runup in value, there often is a downturn in the company's fortunes. I still have a few company stocks with large capital gains.

I have a limit to how much capital gains I will pay in any one tax year so I will continue to hold some individual stocks for years.

Dave55
Posts: 393
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Location: Colorado

Re: Did you ever "win" big?

Post by Dave55 » Sat Jan 12, 2019 8:40 pm

Never won big with a stock, but I invested in an apartment building in Anaheim CA back in the 90's, got 2.5X my money back in 3 years. I also invested in a hedge fund back in the 90's that was Oil and Gas Services, I knew the manager, very sharp guy who grew up in the Oil and Gas services industry, the return was 2.2X in a period of less than 3 years. He closed the fund and retired.


Dave

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MN-Investor
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Location: Twin Cities

Re: Did you ever "win" big?

Post by MN-Investor » Sat Jan 12, 2019 9:40 pm

$2/share for former employee stock, currently selling for about $60/share. Over the past 7 years I've sold or donated a little more than half of the shares at about an average of $40/share. I still own 12,000 shares.
Last edited by MN-Investor on Sat Jan 12, 2019 9:48 pm, edited 1 time in total.
The key to success - Save early, save often, invest well.

yousha
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Re: Did you ever "win" big?

Post by yousha » Sat Jan 12, 2019 9:44 pm

Microsoft and Amazon.

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arcticpineapplecorp.
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Re: Did you ever "win" big?

Post by arcticpineapplecorp. » Sat Jan 12, 2019 9:45 pm

fire4fun wrote:
Sat Jan 12, 2019 3:55 pm
I don't think picking 1 or 2 stocks is a good idea. We are in agreement there. What I am referring to as 1 or 2 big wins are things like investing in a business which can be your own (not on the stock market), investing in real estate, or your human capital. Those are the things that can help you secure a big win, instead of waiting until you are 65 to have $1-2M in the bank.

I have never bought an individual stock and I've probably more against it than you. So all that you are typing is preaching to the choir.

If I'm going to sacrifice now, I want the rewards soon, in 5 years, and later. Not just later.

Anyone using that lottery agreement sounds like they are giving up and just want to settle for average. They don't think they have it in them to create wealth or have a big win now so they settle for it when they are old.

I believe in the power of crafting your chosen life and destiny. I think having one or two big wins in your thirties and forties that will set you up for life is not only possible, it's very realistic. With the right mindset. I have already done it by age 31 because I didn't want to to settle for average.

You want the option to take a sabbatical, travel, start a new business, work part-time, etc. you can't do any of those if you've decided to contribute your savings into a retirement account and work full time in a job you may or may not like for 30-40 years.

Investing solely in index funds hoping to get the market return and then maybe when you're in your sixties or seventies you can do the things I mentioned above, doesn't interest me. I want control over my life and not be at the whims of the economy or stock market. It may interest you but that's the beauty of life. People are different.
Good to see we agree on many points. Glad to see you haven't picked individual stocks.

I agree that investing in one's human capital is important but I think it's also important to understand the role of luck (good or bad) can play in one's life. Example: someone ponies up hundreds of thousands of dollars and many years to finally become a doctor. Unfortunately, they become disabled some time after beginning their practice. It happens. I'm not saying it's the norm, but you can't say whether someone is successful or not is solely up to them. You can do everything you're supposed to, take chances, increase knowledge and so on. There are no guarantees of success. Yes, you can increase your odds by doing these things, but there's no guarantee of anything in life.

You keep using the word "average" like it's a bad thing. You clearly believe you're above average. Most people do. See how that's a fallacy because not all the children can be above average? Most think they're above average drivers, dressers, lovers. They're not.

It sounds to some extent like you've drunk the Rhonda Byrne, Robert Kyosaki, Toni Robbins kool aid. There are millions of people around the world that live in abject poverty. Did they not work hard enough? Were they not creative enough? Did they not take enough risks? You have to understand that you may have had many opportunites to succeed that are simply not available to millions of people in other parts of the world. That is called Luck and Warren Buffett admitted he had luck by being born in America at the specific time he did and so on.

You also may be confusing strategy with outcome. Because you got a good outcome and are F.I. that doesn't mean your strategy was the right one, or will work for everyone. If it did then wouldn't everyone be rich as rich? And you never explained how hard working, smart, creative, risk takers like hedge fund managers managed to destroy wealth rather than build wealth for their clients over the past 15 years. I'm still waiting for your explanation on that one.

To understate the role luck plays in life is short sighted and harmful to others who have worked hard but not been lucky. It's like blaming the victim. Did the person give themselves cancer or were they just unlucky? Did they choose to be born in poverty or were they just unlucky? Does luck play absolutely no role whatsoever in anyone's life? Is there not an extraordinary amount of randomness in the universe? Aren't there ample instances of this all around? Clearly there are. If you believe in destiny, then everything is predestined and there's no point to doing anything because your destiny will come to fruition no matter what, right? If it's your destiny to be successful, is it someone else's destiny to be a failure? Do you see how this type of thinking is fine if you're a success but harmful to others who have not yet succeeded?

Everybody wants control over their life but believing you have control is an illusion.

I find it interesting that you wrote:
fire4fun wrote:
Tue Dec 25, 2018 7:13 pm
Financial: Nobody knows nuthin'.

Personal: Life is beautiful, everywhere you look.
viewtopic.php?f=10&t=267566&p=4280139#p4280139
You seem much more certain about how the world works and how easy it is for anyone to be successful now than you did when you admitted "Nobody knows nuthin'." What changed between now and then?

Do you think people who are trying to flee war-torn countries or trying to survive genocidal events think life is beautiful everywhere they look? Just because things are all roses for you doesn't mean that's true for everyone. Have you never had any struggle whatsoever in life? If not, you should consider yourself lucky (there's that word again) because that definitely is not the norm. The Buddha said "Life is suffering". Yes, he found "the way" out of suffering but he had his struggles on the path just as everyone else does. Remember not everyone is where you're at. If you're in a good place, that's great. Not everyone is. That's the humility part I recommended earlier.

You also said this:
fire4fun wrote:
Tue Jan 01, 2019 4:15 pm
It's interesting, I somewhat listened to the Boglehead/passive indexing mantra of invest in what's doing poorly/undervalued etc. So about half of my 401k was in international. Got crushed. Not making that same mistake again.
source: viewtopic.php?f=10&t=268328&p=4293539#p4293485
I find it interesting that you admit you actually make "mistakes", considering you make it seem it's so easy to "win big". Unfortunately, what you saw as a mistake, really wasn't one. The mistake was:
1. not sticking with your plan (if you had one. Did you have a plan, an IPS? If so why are you changing it so readily?)
2. looking at one year returns (or 5 year since you want to or "needed" to win big in 5 years time rather than 30 years)
3. extrapolating into the future based on the recent past (i.e., last year international got "crushed" so surely it will from here on out)
4. selling an asset after it's fallen in value
5. failing to understand the difference between rebalancing and investing in "what's doing poorly/undervalued". These are not always one in the same. Rebalancing requires you to buy/sell to get back to your stated allocation. That doesn't mean what you buy is always "undervalued".
"Invest we must" | "By God, If John Q. Public doesn't get the word after two Swedroe books, two (Bill) Bernstein books, and four Bogle books, he (she) has only himself to blame!"

fire4fun
Posts: 91
Joined: Tue Dec 25, 2018 2:29 am

Re: Did you ever "win" big?

Post by fire4fun » Sat Jan 12, 2019 10:22 pm

arcticpineapplecorp. wrote:
Sat Jan 12, 2019 9:45 pm
fire4fun wrote:
Sat Jan 12, 2019 3:55 pm
I don't think picking 1 or 2 stocks is a good idea. We are in agreement there. What I am referring to as 1 or 2 big wins are things like investing in a business which can be your own (not on the stock market), investing in real estate, or your human capital. Those are the things that can help you secure a big win, instead of waiting until you are 65 to have $1-2M in the bank.

I have never bought an individual stock and I've probably more against it than you. So all that you are typing is preaching to the choir.

If I'm going to sacrifice now, I want the rewards soon, in 5 years, and later. Not just later.

Anyone using that lottery agreement sounds like they are giving up and just want to settle for average. They don't think they have it in them to create wealth or have a big win now so they settle for it when they are old.

I believe in the power of crafting your chosen life and destiny. I think having one or two big wins in your thirties and forties that will set you up for life is not only possible, it's very realistic. With the right mindset. I have already done it by age 31 because I didn't want to to settle for average.

You want the option to take a sabbatical, travel, start a new business, work part-time, etc. you can't do any of those if you've decided to contribute your savings into a retirement account and work full time in a job you may or may not like for 30-40 years.

Investing solely in index funds hoping to get the market return and then maybe when you're in your sixties or seventies you can do the things I mentioned above, doesn't interest me. I want control over my life and not be at the whims of the economy or stock market. It may interest you but that's the beauty of life. People are different.
Good to see we agree on many points. Glad to see you haven't picked individual stocks.

I agree that investing in one's human capital is important but I think it's also important to understand the role of luck (good or bad) can play in one's life. Example: someone ponies up hundreds of thousands of dollars and many years to finally become a doctor. Unfortunately, they become disabled some time after beginning their practice. It happens. I'm not saying it's the norm, but you can't say whether someone is successful or not is solely up to them. You can do everything you're supposed to, take chances, increase knowledge and so on. There are no guarantees of success. Yes, you can increase your odds by doing these things, but there's no guarantee of anything in life.

You keep using the word "average" like it's a bad thing. You clearly believe you're above average. Most people do. See how that's a fallacy because not all the children can be above average? Most think they're above average drivers, dressers, lovers. They're not.

It sounds to some extent like you've drunk the Rhonda Byrne, Robert Kyosaki, Toni Robbins kool aid. There are millions of people around the world that live in abject poverty. Did they not work hard enough? Were they not creative enough? Did they not take enough risks? You have to understand that you may have had many opportunites to succeed that are simply not available to millions of people in other parts of the world. That is called Luck and Warren Buffett admitted he had luck by being born in America at the specific time he did and so on.

You also may be confusing strategy with outcome. Because you got a good outcome and are F.I. that doesn't mean your strategy was the right one, or will work for everyone. If it did then wouldn't everyone be rich as rich? And you never explained how hard working, smart, creative, risk takers like hedge fund managers managed to destroy wealth rather than build wealth for their clients over the past 15 years. I'm still waiting for your explanation on that one.

To understate the role luck plays in life is short sighted and harmful to others who have worked hard but not been lucky. It's like blaming the victim. Did the person give themselves cancer or were they just unlucky? Did they choose to be born in poverty or were they just unlucky? Does luck play absolutely no role whatsoever in anyone's life? Is there not an extraordinary amount of randomness in the universe? Aren't there ample instances of this all around? Clearly there are. If you believe in destiny, then everything is predestined and there's no point to doing anything because your destiny will come to fruition no matter what, right? If it's your destiny to be successful, is it someone else's destiny to be a failure? Do you see how this type of thinking is fine if you're a success but harmful to others who have not yet succeeded?

Everybody wants control over their life but believing you have control is an illusion.

I find it interesting that you wrote:
fire4fun wrote:
Tue Dec 25, 2018 7:13 pm
Financial: Nobody knows nuthin'.

Personal: Life is beautiful, everywhere you look.
viewtopic.php?f=10&t=267566&p=4280139#p4280139
You seem much more certain about how the world works and how easy it is for anyone to be successful now than you did when you admitted "Nobody knows nuthin'." What changed between now and then?

Do you think people who are trying to flee war-torn countries or trying to survive genocidal events think life is beautiful everywhere they look? Just because things are all roses for you doesn't mean that's true for everyone. Have you never had any struggle whatsoever in life? If not, you should consider yourself lucky (there's that word again) because that definitely is not the norm. The Buddha said "Life is suffering". Yes, he found "the way" out of suffering but he had his struggles on the path just as everyone else does. Remember not everyone is where you're at. If you're in a good place, that's great. Not everyone is. That's the humility part I recommended earlier.

You also said this:
fire4fun wrote:
Tue Jan 01, 2019 4:15 pm
It's interesting, I somewhat listened to the Boglehead/passive indexing mantra of invest in what's doing poorly/undervalued etc. So about half of my 401k was in international. Got crushed. Not making that same mistake again.
source: viewtopic.php?f=10&t=268328&p=4293539#p4293485
I find it interesting that you admit you actually make "mistakes", considering you make it seem it's so easy to "win big". Unfortunately, what you saw as a mistake, really wasn't one. The mistake was:
1. not sticking with your plan (if you had one. Did you have a plan, an IPS? If so why are you changing it so readily?)
2. looking at one year returns (or 5 year since you want to or "needed" to win big in 5 years time rather than 30 years)
3. extrapolating into the future based on the recent past (i.e., last year international got "crushed" so surely it will from here on out)
4. selling an asset after it's fallen in value
5. failing to understand the difference between rebalancing and investing in "what's doing poorly/undervalued". These are not always one in the same. Rebalancing requires you to buy/sell to get back to your stated allocation. That doesn't mean what you buy is always "undervalued".
Here's the thing, I am one person and I can only comment on my own experience. I am not those people that you described above so I cannot comment on whether life is beautiful for them or whether they worked really hard or didn't. So I'm not sure how that comparison is relevant.

You definitely believe in destiny and you are far far on that side of the fence and thinking that everything is by luck and chance. I'm actually towards the other end of the spectrum. Not all the way on the other side, but more than halfway from the end that you're on. Hope that makes sense.

Ask for your cancer example. We know that cancer is a heterogeneous group of diseases with many complex interactions, most of which are still not understood. However, you fail to understand one important concept. For example, I know that eating certain processed foods, heated up starches that form acrylamide, etc are potentially cancer-causing. If I even eat some of these in my whole life, this means that if I get cancer I should not be a surprise. means that I did not do everything in my power to prevent this, despite knowing what things may contribute to cancer.

In other words, a lot of people have gotten cancer knowing full well that their lifestyle contributed to it. If not contributed, they we're weak and not disciplined and ingested things into their body that they knew were cancer-causing. At that point, would you still say it was bad luck or chance? I wouldn't. Almost every cancer has an acquired component, even the heavily genetic ones.

Maintaining a normal weight, improving their insulin sensitivity, and not eating processed food or starches that were heated to high to form acrylamide, for instance. Instead, this person had a bad lifestyle that he probably knew was bad but still took the chance. For example, french fries are extremely bad for us for many different reasons, yet people still eat them. Should they be surprised and say it was bad luck that they developed a health condition in the future?

Here's the thing, only 15% of my assets are in index funds. That is for a very specific reason. I don't want a large portion of my net worth in something that I have zero control over. So with a 50/50 allocation with half of stocks being International, International really composes more like 3.5% of NW.

Valuethinker
Posts: 37277
Joined: Fri May 11, 2007 11:07 am

Re: Did you ever "win" big?

Post by Valuethinker » Sun Jan 13, 2019 9:25 am

I would urge anyone reading this thread to consider a few things I have observed about men, specifically, in their conversation with other men (I cannot really speak to the female gender case).

Men pretty much always lie or exaggerate about certain things. My benchmark for this is my close friends, who I would argue are less prone to these things, vs. "bloke chat" in more general contexts like over a beer in the pub.

1. how many sexual partners they have had (overstate, at least of partners of the female gender). I understand women, by and large, do the opposite. At least any study which has been able to match the claimed levels with the actuals seems to show this.

If monogamous about how frequently they have sexual relations with their partner.

2. golf handicap, time and distance they regularly run, how much weight they can bench press, last time they went to the gym, etc. - underestimate in their favour

3. how much they can drink without experiencing ill effects (overestimate) & the impact on the pleasantness of their interactions with others & their driving ability (underestimate). Alcohol is, in fact, a drug that does precisely that

3. salary & career progression. Responsibility level at work (overestimate)

4. actual weight (underestimate)

5. net worth - usually they give you gross worth, and don't mention their debts (overestimate)

6. value of stock portfolio. Overestimate

7. They tend to tell you about successful investments, and omit to mention the disastrous ones

Those with young children are probably pretty accurate about how much sleep they get ;-).

Thus I would take anything any man says about investing, in an anonymous internet forum, cum grano salis as the Romans would have said (with a grain of salt).

I have had some 10 baggers, but overall I have not done better than someone who had used low cost index funds over that period -- at least I don't think I have, I'm not sure if I have the data to even check over 30+ years.
Last edited by Valuethinker on Sun Jan 13, 2019 9:36 am, edited 2 times in total.

Valuethinker
Posts: 37277
Joined: Fri May 11, 2007 11:07 am

Re: Did you ever "win" big?

Post by Valuethinker » Sun Jan 13, 2019 9:32 am

2015 wrote:
Sat Jan 12, 2019 7:50 pm


No, there is no "little" amount of luck. Life is enmeshed in luck, both good and bad.

I couldn't agree more with the entirety of your last paragraph. No you can't know "everything" but you can know the right things. The cavalcade of daily short-term junk that passes for "information" in the fields of investing, personal finance, and microeconomics is most certainly not among those things. What you can know is how to think, you can know how media of all types is manipulating you and stealing your life by focusing on the short-term that do not make you effective and in fact make you less effective, you can get better at decision making.

When you read the right things, you will automatically put that information into action, right action. I recommend reading the fields of business strategy, historical politics as it relates to humans in the fight for money, power, and agency, the present and future of technology, trends and innovation. I also recommend investing time in studying and understanding complex adaptive systems. Why? Because human beings are CAS, as is investing, personal finance, and economics of all kinds. The fields of gambling, games, sports, biology, physics, engineering, archaeology, systems, neurology, media, mental model construction and a host of others all apply to the effectiveness/ineffectiveness of human decision making.

One prediction that can be made with a high degree of confidence is that "students of investing" are never fishing in the Optimal lake at the Optimal time with the Optimal degree of clarity. They are too busy chasing after the big one that will always get away (Maximization).
I like the emphasis on Complexity and Complex Adaptive Systems.

Napoleon had a maxim to his generals "first, you must be lucky". "I can't use you if you are not lucky" was, I think, the maxim of the US commander of submarine forces in WW2 to his captains (not sure: apocryphal).

In investing, accepting that the complexity is actually unfathomable is pretty important. Index funds really are the best way because the complexity of the underlying factors of causation (and the feedback effects) are too large.

Valuethinker
Posts: 37277
Joined: Fri May 11, 2007 11:07 am

Re: Did you ever "win" big?

Post by Valuethinker » Sun Jan 13, 2019 9:43 am

fire4fun wrote:
Sat Jan 12, 2019 10:22 pm

Ask for your cancer example. We know that cancer is a heterogeneous group of diseases with many complex interactions, most of which are still not understood. However, you fail to understand one important concept. For example, I know that eating certain processed foods, heated up starches that form acrylamide, etc are potentially cancer-causing. If I even eat some of these in my whole life, this means that if I get cancer I should not be a surprise. means that I did not do everything in my power to prevent this, despite knowing what things may contribute to cancer.

...

Here's the thing, only 15% of my assets are in index funds. That is for a very specific reason. I don't want a large portion of my net worth in something that I have zero control over. So with a 50/50 allocation with half of stocks being International, International really composes more like 3.5% of NW.
The equation of cancer inducing behaviour with using index fund is fairly hilarious.

I shall let you in on a particularly amusing sidelight.

The most common forms of cancer are gender related and not particularly lifestyle related. Prostate cancer (in men) and breast cancer (in women).

Unless you are willing to be castrated, there's not a whole lot you can do about risk of the former. Radical mastectomy in the case of the latter. Over to you ;-).

Another example:

HPV we now know is carried by both men and women, but manifests as cervical cancer in women (well up there as a cause of premature death in women). The vaccine is only recently available and has to be given in adolescence (when your parents make that choice for you). Thus, short of total sexual abstinence, if you are a woman and you are not vaccinated then, even if you are monogamous you are at risk from *all* of your partner's previous sexual partners.

Another way of avoiding as a woman would be to have strictly have sexual relations only with other women.

Mingus
Posts: 683
Joined: Fri Apr 19, 2013 2:25 pm

Re: Did you ever "win" big?

Post by Mingus » Sun Jan 13, 2019 9:56 am

sjt wrote:
Fri Jan 11, 2019 9:56 am
ReformedSpender wrote:
Fri Jan 11, 2019 9:21 am
ChinchillaWhiplash wrote:
Fri Jan 11, 2019 8:30 am
I bought Tesla stock at $33 a share about 20 years ago. Sold it at around $125. Wish I would have held it longer :oops:
Tesla was founded in '03 and didn't go public until '10 with an offering price of $17 a share nonetheless...

Regardless, congrats
Clearly Chinchilla is posting from some point in the future.
Some say Nikola Tesla invented time travel. Coincidence that someone from the future is making remarks on Tesla stock? I think not.

User avatar
fishandgolf
Posts: 456
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Re: Did you ever "win" big?

Post by fishandgolf » Sun Jan 13, 2019 10:06 am

Valuethinker wrote:
Sun Jan 13, 2019 9:25 am
I would urge anyone reading this thread to consider a few things I have observed about men, specifically, in their conversation with other men (I cannot really speak to the female gender case).

Men pretty much always lie or exaggerate about certain things. My benchmark for this is my close friends, who I would argue are less prone to these things, vs. "bloke chat" in more general contexts like over a beer in the pub.
This is funny stuff..............it reminds me of my neighbor.......he always seems to win each time he goes to the casino....

There's this ole' saying about those kinda folks......

There are two type of people that leave a casino..............losers and liars......... 8-)

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hoppy08520
Posts: 2099
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Re: Did you ever "win" big?

Post by hoppy08520 » Sun Jan 13, 2019 10:06 am

My software company got bought by another. We got stock options from the new company as a retention incentive. Having had almost worthless stock options in prior jobs, I didn’t put much stock (ha ha!) into those pieces of paper and forgot about them.

During the transition to the new ownership there was a lot of heartache and frustration from my colleagues and many of them quit and moved on, and collected maybe a couple of thousand $$$ from their un-vested, under-valued shares.

I stuck around, and 3 years later, the company sold again. The sale triggered a stock payout and I collected around $125,000, taxable as longterm capital gains which is lower than ordinary income tax.

That’s my biggest win.

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