When I read the WSJ years ago, your column was the first one I read in that paper each week. Your columns were always superb and I learned so much from you. After you left I discovered this wonderful web site, where I have continued to learn an enormous amount, thanks to you and your co-writers. But your columns since your diagnosis are the ones that have taught me the most of all. They are profound and beautifully written. Thank you, thank you, thank you, Jonathan!!!
What did the investor do between 2/19/20 and 3/23/20 when the stock market dropped 34% in the 24 days it was open: How much of their portfolio if anything did they sell?
Did they stop dollar cost averaging?
Did they stop contributing to their 401k?
Did they change the allocations of their 401k? After answering those questions, repeat them for the 10/07 - 3/09 crash when the market dropped about 57%
I would invest in a person or a company who would create an index fund so I could invest in it. There is no substitute for index funds. They are the best!
Klaatu is 100% correct. The problem is that when you look at how index funds have performed overall over the last 20 years and compare it to how non-index funds have performed during that same period, index funds have outperformed 80-90% of their non-index brethren, i.e. index funds almost never hit home runs, but they hit far more triples than non-index funds.
Vanguard Total U.S Stock (VTSAX)
Vanguard Total International Stock (VTIAX)
Vanguard Total Bond (VBTLX) of their equivalents in ETFs
VTI
VXUS
BND Choose either the first 3 or the latter 3 and you will be move diversified than the vast majority of investors.
I couldn't agree more with Philip Stein. Jonathan's column in the WSJ was the first article I read each day for years and years, and by the far the best column I read. I learned more from him than from any of the many wonderful writers who have been mentioned on this page.
I discovered Jonathan when he wrote for the WSJ. His was the first article I read each day. Over the years, I have learned more from Jonathan than from any of the many other financial writers I follow. For the last 19 years I have taught an investing class, and Jonathan's Humble Dollar is where I send them, whenever I can't answer their question. But none of that is nearly as important as what follows. Every word that I've read of his has been 100% trustworthy. In contrast, most other financial writers push this product or that product because it will benefit them. That thought has never once entered Jonathan's mind. How many other financial writers do you know who offer a column and an entire website that is free of charge and sells absolutely nothing. And to top it off, he has stopped accepting donations. He is one of a kind and is irreplaceable! I will keep you in my thoughts and hope for the best, Jonathan. I know the world doesn't work this way, but if anyone ever deserved a long life, it is you.
Hi Jonathan. If I had a website that:
1-Had nearly 5 million page views last year
2-Provided incredibly valuable and accurate information about investing and much more to its readers, I would be screaming for joy and extraordinarily proud of what I had accomplished. To tell you the truth, I would be happy with 500,000 page views. I have been teaching an investing class to seniors for many years, and I tell all my students that your website is fabulous. I am not aware of any other site that comes even close to offering everything that your site does. And there certainly isn't a free site that offers what you do. Thank you very much for what you have given all of us.
As always, this was an excellent article, Adam. Thank you. However, I think you left out an important point. While bonds certainly drop in price when interest rates rise, as they have been doing for the the last 2.5 years or so, the reverse is also true. When interest rates fall, bond prices rise. Investors who invested in bonds in 1980 lived through an almost continuous decline in interest rates for the next 40 years. There were certainly some periods of time when interest rates increased, but the long term direction for interest rates was down. The result was that investors who held bonds during this period generally earned more than the coupon. And the investors who earned the most were those who owned long term bonds because they have long durations.
Thank you for another outstanding column, Jonathan. Regarding your number 7, I know you know this but others may not. If you buy Vanguard's Total Stock Mkt Index ETF (VTI) it only costs you 30 cents per $1000 invested rather than $1. Saving 70 cents per year might not seem like much, but assume you invest $100,000 and let it sit for 30 years. Assume the stock market returns 10% per year before expenses. If you invest in a retirement account and pay $1/year in expenses you'll end up with $1,697,973 in your account. If you pay 30 cents per year, you'll end up with about $32,000 more or to be precise $1,730,720. You have pointed this out in dozens of your columns: When compounded over 30 years even small differences in expense ratios can add up to a lot of money.
Comments
When I read the WSJ years ago, your column was the first one I read in that paper each week. Your columns were always superb and I learned so much from you. After you left I discovered this wonderful web site, where I have continued to learn an enormous amount, thanks to you and your co-writers. But your columns since your diagnosis are the ones that have taught me the most of all. They are profound and beautifully written. Thank you, thank you, thank you, Jonathan!!!
Post: No Regrets
Link to comment from September 7, 2024
What did the investor do between 2/19/20 and 3/23/20 when the stock market dropped 34% in the 24 days it was open: How much of their portfolio if anything did they sell? Did they stop dollar cost averaging? Did they stop contributing to their 401k? Did they change the allocations of their 401k? After answering those questions, repeat them for the 10/07 - 3/09 crash when the market dropped about 57%
Post: What’s the best way to gauge an investor’s risk tolerance?
Link to comment from June 22, 2024
I would invest in a person or a company who would create an index fund so I could invest in it. There is no substitute for index funds. They are the best!
Post: If you couldn’t buy index funds, how would you invest?
Link to comment from June 22, 2024
Klaatu is 100% correct. The problem is that when you look at how index funds have performed overall over the last 20 years and compare it to how non-index funds have performed during that same period, index funds have outperformed 80-90% of their non-index brethren, i.e. index funds almost never hit home runs, but they hit far more triples than non-index funds.
Post: Is there a downside to the current popularity of indexing?
Link to comment from June 22, 2024
Vanguard Total U.S Stock (VTSAX) Vanguard Total International Stock (VTIAX) Vanguard Total Bond (VBTLX) of their equivalents in ETFs VTI VXUS BND Choose either the first 3 or the latter 3 and you will be move diversified than the vast majority of investors.
Post: If you could buy just three funds or less, what would they be?
Link to comment from June 22, 2024
I couldn't agree more with Philip Stein. Jonathan's column in the WSJ was the first article I read each day for years and years, and by the far the best column I read. I learned more from him than from any of the many wonderful writers who have been mentioned on this page.
Post: What’s the best financial book you’ve ever read?
Link to comment from June 22, 2024
I discovered Jonathan when he wrote for the WSJ. His was the first article I read each day. Over the years, I have learned more from Jonathan than from any of the many other financial writers I follow. For the last 19 years I have taught an investing class, and Jonathan's Humble Dollar is where I send them, whenever I can't answer their question. But none of that is nearly as important as what follows. Every word that I've read of his has been 100% trustworthy. In contrast, most other financial writers push this product or that product because it will benefit them. That thought has never once entered Jonathan's mind. How many other financial writers do you know who offer a column and an entire website that is free of charge and sells absolutely nothing. And to top it off, he has stopped accepting donations. He is one of a kind and is irreplaceable! I will keep you in my thoughts and hope for the best, Jonathan. I know the world doesn't work this way, but if anyone ever deserved a long life, it is you.
Post: The C Word
Link to comment from June 15, 2024
Hi Jonathan. If I had a website that: 1-Had nearly 5 million page views last year 2-Provided incredibly valuable and accurate information about investing and much more to its readers, I would be screaming for joy and extraordinarily proud of what I had accomplished. To tell you the truth, I would be happy with 500,000 page views. I have been teaching an investing class to seniors for many years, and I tell all my students that your website is fabulous. I am not aware of any other site that comes even close to offering everything that your site does. And there certainly isn't a free site that offers what you do. Thank you very much for what you have given all of us.
Post: Business Schooled
Link to comment from January 6, 2024
As always, this was an excellent article, Adam. Thank you. However, I think you left out an important point. While bonds certainly drop in price when interest rates rise, as they have been doing for the the last 2.5 years or so, the reverse is also true. When interest rates fall, bond prices rise. Investors who invested in bonds in 1980 lived through an almost continuous decline in interest rates for the next 40 years. There were certainly some periods of time when interest rates increased, but the long term direction for interest rates was down. The result was that investors who held bonds during this period generally earned more than the coupon. And the investors who earned the most were those who owned long term bonds because they have long durations.
Post: Long and Short of It
Link to comment from September 27, 2023
Thank you for another outstanding column, Jonathan. Regarding your number 7, I know you know this but others may not. If you buy Vanguard's Total Stock Mkt Index ETF (VTI) it only costs you 30 cents per $1000 invested rather than $1. Saving 70 cents per year might not seem like much, but assume you invest $100,000 and let it sit for 30 years. Assume the stock market returns 10% per year before expenses. If you invest in a retirement account and pay $1/year in expenses you'll end up with $1,697,973 in your account. If you pay 30 cents per year, you'll end up with about $32,000 more or to be precise $1,730,720. You have pointed this out in dozens of your columns: When compounded over 30 years even small differences in expense ratios can add up to a lot of money.
Post: So Much to Like
Link to comment from April 1, 2023