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Discussion in 'The Duck Hunters Forum' started by Lip Shooter, Feb 5, 2018.
Yeah I averaged a 50% gain, awe shucks I lost 40%, but it is all cool.
Now the stock market math in reality:
100k makes 50% in year one so I have a 150k
I only lost -40% in year 2 so I now have 90k
But, but, my average rate of return is plus 5%
This is why Pinny pointed out the proper way to reconcile your true stock market gains.
Negative returns are bad, very, very bad.
My guy will visit next Thursday, he has done very well for us. A correction really doesn’t bother me, he’s prepared us for it. We’ve had him for over 20 years, I think that speaks volumes.
Remember the rule of 72!
Years required to double investment = 72 ÷ compound annual interest rate
Dave Ramsey says 12% ROI is what people should expect when making long term investments in the market. Is this number realistic or too optimistic considering the S&P has averaged roughly 8% per year since its inception?
I moved everything on Tuesday to cash equivalents and bonds. I feel good about that decision, cut my loss's early, and going to buy back in when things make a turn. I can't function watching my retirement tank...I was losing my mind.
I can get on Fidelity (work 401k) and look to see what funds have averaged better than the market over a ten year period. It takes some time but on a night shift with no work happening it keeps me alert.
Remember this when doing that. It has been proven that previous performance of a fund has zero indication of future performance.
I believe the Yale endowment was the study showing this fact. Advisers hate when you ask about it
Really? I thought he was more like 8% is good and 10% is knocking it out of the park. Could be wrong though.
The time to figure your rate of return on an investment is when you have the cash in hand.