Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

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SemiRetire
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by SemiRetire » Sun Jan 12, 2020 4:38 am

Btc via gbtc

3funder
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by 3funder » Sun Jan 12, 2020 8:07 am

I don't have an "Anti-Boglehead" account, but I suppose my 10% international equity tilt (originally starting at global market cap) might be considered a little risky. This is due to current valuations. I rarely make changes to my AA, but when I do, they are moderate and based on the passage of time or what I consider to be unreasonable valuations. I don't ever plan to deviate more than 10% from global market cap in total market equity index funds. I do believe the occasional tilts will enhance my returns by at least a small margin, and I am fully confident that if they don't, the negative impact at any point in time would be inconsequential.

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Wiggums
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by Wiggums » Sun Jan 12, 2020 8:56 am

Getting married was a 50% risk to my portfolio. :-)

ARoseByAnyOtherName
Posts: 481
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by ARoseByAnyOtherName » Sun Jan 12, 2020 10:16 am

thoughtware wrote:
Sat Apr 06, 2019 12:13 pm
I am selling off GOOGL because I have started using the Brave browser almost exclusively and duckduckgo as my default search engine. Why? Because the ads and data tracking are too invasive. Also, if I'm looking to buy something, the first search engine I use is Amazon.
What you do doesn't have any impact on Google whatsoever. Google's prospects are only impacted by the behavior of many, many people.

So, do you think that many, many people are going to start using duckduckgo as their default search engine? If so, what data or evidence do you have that supports this theory?

prioritarian
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by prioritarian » Sun Jan 12, 2020 3:43 pm

I tilt my bonds to long duration treasuries when I believe we are firmly in the late cycle and move back to total bonds in the recovery stage.

I tilt my international equities position to emerging stocks using a low-volatility EM fund (EEMV).

(Overall AA: US eq: 35, Int eq: 30, Bonds: 35.)

renegade06
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by renegade06 » Sun Jan 12, 2020 7:13 pm

Wiggums wrote:
Sun Jan 12, 2020 8:56 am
Getting married was a 50% risk to my portfolio. :-)
Haha good one!

AlphaLess
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by AlphaLess » Sun Jan 12, 2020 7:24 pm

ChowYunPhat wrote:
Sat Jun 29, 2019 10:24 am
It's a funny thing. I invested in a single stock recently in an industry I work in. Have good knowledge of the company and believe it is headed in the right direction and priced at a bargain. I have never done this before and it's a very small position relative to other holdings. What's funny is I'm annoyed that I find myself checking the price of the stock more frequently...I'm close to selling the position for this reason alone.

The takeaway....it's another vote for dollar cost averaging a diversified set of low cost index funds. It's simple, time tested, and eliminates concentration risk among your holdings. On a personal note, I would probably spend too much time trying to understand specific company performance and risk when holding specific assets. Not sure what else I expected but the approach would take some time getting used to.
There is an element of addiction here. The addiction is to information arrival. Stock prices are a random walk, for the most part, and thus, there is a huge incentive to the reward pathway to find that new information.

In the old-school Wall Street, addiction was common among traders. The choice of addiction were cocaine and alcohol. So checking ones positions and prices, as well as feeling like one can change the PnL (i.e., have edge or alpha) are all related to the addiction.

So there are a few solutions to this:
- systematize trading, i.e., eliminate human discretion,
- automatize, i.e., eliminate human action,
- standardize, i.e., check PnL / position once a day, e.g., at the end of the day.

If you are able to control the impulse when your positions / trading are new small, and develop the skills, later on, you can be comfortable with the skills and discipline gained.

It is very hard to make extract alpha with one or two positions. Idiosyncratic risk is too much. Having a diversified position, such as 100 long and 100 short, is much more easy on one's nerves.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.

1130Super
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by 1130Super » Sun Jan 12, 2020 8:16 pm

Bought some Dis, and TSLA leaps
Last edited by 1130Super on Mon Jan 13, 2020 1:34 am, edited 1 time in total.

GoldenFinch
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by GoldenFinch » Sun Jan 12, 2020 8:28 pm

JonnyDVM wrote:
Sun Apr 07, 2019 7:31 pm
Bob Sacamano wrote:
Sun Apr 07, 2019 7:10 pm
JonnyDVM wrote:
Sat Apr 06, 2019 12:58 pm
Biotech

AMRN
LPCN
PTLA
funny. we have some $PTLA investors here. kind of surprised actually.
Lol. I’m very surprised. I would have wagered I was the only one. I’m not sure if that should make me more confident or more nervous.
These stock have really tanked since these April posts. :shock:

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JonnyDVM
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by JonnyDVM » Sun Jan 12, 2020 8:52 pm

GoldenFinch wrote:
Sun Jan 12, 2020 8:28 pm
JonnyDVM wrote:
Sun Apr 07, 2019 7:31 pm
Bob Sacamano wrote:
Sun Apr 07, 2019 7:10 pm
JonnyDVM wrote:
Sat Apr 06, 2019 12:58 pm
Biotech

AMRN
LPCN
PTLA
funny. we have some $PTLA investors here. kind of surprised actually.
Lol. I’m very surprised. I would have wagered I was the only one. I’m not sure if that should make me more confident or more nervous.
These stock have really tanked since these April posts. :shock:
Oh yah. Amarin has been a huge disappointment. At least it’s made for a good running joke amongst my friend group.

LPCN I fortunately got out at $2, but my friends were greedy and got caught holding the bag on that one.

PTLA took a dive Friday. I did a little research and it turns out that in general companies need to be profitable to return money to investors.

Have one winner DBVT that makes a peanut allergy drug, but not nearly enough to offset the rest. Would have been much better off putting all fun money into total market last year. That wouldn’t have been very fun though. :greedy
Sometimes the questions are complicated and the answers are simple. -Dr. Seuss

GoldenFinch
Posts: 1995
Joined: Mon Nov 10, 2014 11:34 pm

Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by GoldenFinch » Mon Jan 13, 2020 10:20 am

JonnyDVM wrote:
Sun Jan 12, 2020 8:52 pm
GoldenFinch wrote:
Sun Jan 12, 2020 8:28 pm
JonnyDVM wrote:
Sun Apr 07, 2019 7:31 pm
Bob Sacamano wrote:
Sun Apr 07, 2019 7:10 pm
JonnyDVM wrote:
Sat Apr 06, 2019 12:58 pm
Biotech

AMRN
LPCN
PTLA
funny. we have some $PTLA investors here. kind of surprised actually.
Lol. I’m very surprised. I would have wagered I was the only one. I’m not sure if that should make me more confident or more nervous.
These stock have really tanked since these April posts. :shock:
Oh yah. Amarin has been a huge disappointment. At least it’s made for a good running joke amongst my friend group.

LPCN I fortunately got out at $2, but my friends were greedy and got caught holding the bag on that one.

PTLA took a dive Friday. I did a little research and it turns out that in general companies need to be profitable to return money to investors.

Have one winner DBVT that makes a peanut allergy drug, but not nearly enough to offset the rest. Would have been much better off putting all fun money into total market last year. That wouldn’t have been very fun though. :greedy
What is important is that it was only your fun money and it was a bit fun! :sharebeer Also a good reminder for us Bogleheads who think about risky plays now and then.

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hagridshut
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Joined: Tue Apr 10, 2012 6:54 pm

Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by hagridshut » Wed Jan 15, 2020 1:09 pm

rich126 wrote:
Tue Jan 07, 2020 10:53 am
lexor wrote:
Tue Jan 07, 2020 1:06 am
rich126 wrote:
Tue Jan 07, 2020 12:24 am
lexor wrote:
Sun Jan 05, 2020 9:48 pm
hagridshut wrote:
Sun Jan 05, 2020 9:43 pm


I've seen this phrase, "short Tesla on principle alone" written here at Bogleheads a few times, and I'm curious as to why people would gamble against a company based on what appears to be moral outrage against its unconventional CEO. "Principle alone" being the key part of the phrase, which I interpret to mean on moral grounds alone, regardless of any fundamental analysis of the company's operations.

TSLA was trading at about $275/share in early April 2019. On the first Friday in January 2019, it closed at $443/share. Anyone who shorted TSLA in anger around April 2019, and did not cover when the stock was down in June 2019, is now facing loses of 61%, plus cost of borrowing, plus any collateral damage that might have resulted from margin calls along the way.

Jack Bogle is famous for having said: “Nobody knows nothing.” The absolute certainty that many people expressed that Tesla would be bankrupt in 2019, turned out to be a big nothing, and probably the best advertisement for Index Fund investing I have seen in recent years.
What is the principal in this context? I don't follow this logic.

Musk has done great things for the auto industry and really kicked other companies into gear. E.g. My car makes me pay for (poor quality) map updates and Tesla made them free
Because Tesla’s stock price is outrageously s high compared with its net profit. It has no profit and has lost billions. However obsessive fans of the cars continue to speculate on its stock. My guess is that it will eventually be bought by another company although with its current stock price that won’t happen unless the price drops substantially. So far Tesla has not shown a capability to make enough cars at a profitable cost.
I'm still not sure what the principle is. Just anger that it's overvalued or that other people are supportive? I was expecting a moral argument since he used marijuana or something.
A number of the Tesla supporters just come up with some pretty weak arguments about investing in Tesla and people view them as "fanboys". There is another financial board I read and there are a couple of posters who keep pumping Tesla. They seem to put Elon on some kind of pedestal and view the increase in stock price as a success while ignoring the company hasn't had a profitable year.

Often someone can be right about a stock being vastly overvalued but that is only part of shorting a stock, the other is the time frame. You could lose a ton of money and run out of money before the stock goes down. If you seen the Big Short where the guys were right about mortgages and junk bonds but were running out of money and barely held on before they ultimately made a ton of money.

They (fans) don't want to separate having an interesting technology vs. having a profitable company. And you can also say the "shorters" have a vested interest in bashing the company since they will make money only if the stock drops. Shorting is a tough business since ultimately you can be right but you can go bankrupt before it happens. I could say more but I'll leave it as that.
I do not believe that speculation by "obsessive fans" is likely to be behind the rise in the price of TSLA over the past 3 months. A relative handful of real people (as opposed to institutions) trading TSLA with the Robinhood app on their mobile phones is going to have practically no effect on the supply/demand of TSLA shares.

It's commonly said that Tesla has "lost Billions", and "has no profit", but not many people bothered to look at what Tesla actually built with the money it has spent. It now has 2 automotive factories (Fremont, California and Shanghai, China), 1 massive battery factory (Sparks, Nevada), and is beginning the process of setting up a third automotive factory in Germany.

The technology that Tesla has is in fact relevant to valuation, not because the technology is "cool", but because it sets Tesla up for major cash flow and profitability in the future. The robotics expertise that Tesla purchased in its buyout of Grohman means that it can assemble battery packs faster and at much lower cost than competitors. The company has leading experts in battery chemistry (Jeff Dahn's team at its Canadian subsidiary). Tesla has in-house software and chip design. They aren't dependent on outsourced code or the same nVidia computer hardware as everyone else. If you don't think that's a problem, read up on what's happened with Volkswagen's ID.3 electric car: the software is so behind and problematic that manufactured cars are rotting on storage lots, while VW hopes to get the software that runs the car working in time for a product launch this summer.

Tesla has spent Billions, but they didn't spend it for nothing. The organization built a lot of infrastructure and technological knowhow in the process, which the competition cannot match. The Porsche Taycan was VAG's chance to show that traditional auto could best Tesla, and they could not. The Taycan is far more expensive, with inferior technology and miserably inferior efficiency and range to Tesla's offerings. It does well in some metrics, like handling and interior opulence, but that's not nearly enough to win when the car costs 2-3x as much as a Tesla.

Now, I will say that nobody knows exactly if all this will pay off for Tesla in the next few years and beyond, but I have seen several detailed financial models that give hints of what is possible.

Again, the lesson of TSLA is something that should be a warning to people here: Jack Bogle's statement that "nobody knows nothing" is generally correct. The vast majority of investors did not have the combined knowledge of the automotive market, the technology sector, battery chemistry, and persons behind the company, to accurately gauge how Tesla would fare through 2019. The conventional wisdom in this forum earlier this year was that Tesla was doomed in 2019. I watched people on Twitter shorting the stock as a "sure bet", only to get demolished after October.

Folks, stick to Index funds.
First Principles: (1) Diversify (2) Low Cost (3) Stay the Course | 3-Fund Index Portfolio: S&P500; Intl; U.S.Bonds

Prettyfrtnt
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Re: Those that have an "Anti-Boglehead" investment account, what are your "risky" plays?

Post by Prettyfrtnt » Wed Jan 15, 2020 7:54 pm

Do you take your own advice and stick to index funds or are you tsla long?

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