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Comment on Robinhood admits it’s just a gambling app.

dan@upvote.au ⁨2⁩ ⁨weeks⁩ ago

If you’re investing more than a few percent of your portfolio in any one company, you’re probably gambling though.

I read a forum post many years ago about people that put all their retirement money into some company that was going to be the sole supplier for some components to Apple for the iPhone. Apple didn’t end up going with them, the company went bankrupt, and the people lost all their money.

In the end, why invest in a small number of companies when you can invest in practically all of them? Bogleheads three fund portfolio (total US stock + total world stock + bonds) is very simple yet will beat most actively-managed portfolios over the long run.

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btaf45@lemmy.world ⁨2⁩ ⁨weeks⁩ ago

Bogleheads three fund portfolio (total US stock + total world stock + bonds) is very simple yet will beat most actively-managed portfolios over the long run.

This is right. But you don’t really need the ‘total world stock’. I reduced my allocation of that to 2% because it was dragging down my returns.

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- dan@upvote.au ⁨2⁩ ⁨weeks⁩ ago
  The point of the worldwide stock is to reduce risk in case the US has a recession, as not all other countries will be affected by that. The aim of the Bogleheads three-fund portfolio is to be reasonably balanced in terms of risk vs reward, which is why it includes bonds too.
  
  If you’re not risk-averse then 100% US stock is fine.
  
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  - btaf45@lemmy.world ⁨2⁩ ⁨weeks⁩ ago
    
    The point of including worldwide stock is to reduce risk in case the US has a recession, as not all other countries will be affected by that.
    
    This seems to be generally no longer true.
    
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