39 replies to this topic

[Hans]

Wow, pulling 120k in a single month. Fuck mang. Could do some damage with that kind of cash flow...wish I knew how to get started, I just don't have any ideas that are manageable on a small scale that would result in high volume sales. It's good that you're diversifying though, just to hedge against business risk from existing opportunities that may turn sour.

There's really not much difficulty to stocks....their returns are just not as reliable as something like real estate, where you can hopefully rent it out at a certain rate, but their expected return is much higher than bonds and most forms of real estate provided you can weather short term volatility.

Edited by Hans, 06 February 2012 - 03:35 AM.

[elgordo]

I dunno man- pick up a book like 4-hour work week, or whatever the equivalent is today.

You obvs have some knowledge to share so find a way to monetize it. I started making a couple bucks a month on the side like 6 years ago.

I need a good advisor but it seems like I'm not in that old man's club yet. Most of my friends are normal folks so I don't rub a whole lot of elbows.

[Hans]

I'd actually worry about many high net worth advisers. Many wealthy people become wealthy through luck, inheritance, or are in a lucrative field that doesn't necessarily require business acumen. Investment is simple, but the financial services industry wants to convince you that it isn't, and that you need their help, and they're happy to take your money and charge you high fees for it.

Some of the wealthiest people are actually horrible with money in general, especially when it comes to investments. Many chase after Hedge Funds, because it's all about being in that 'hot, exclusive fund that plebs can't join', yet fail to realize that the fund managers take 2% off every year in management fees, and 20% of profits. This is an exclusive, prestigious club to many folks and they brag about having a high enough net worth to join while others can't. Hedge Fund managers can be wealthy beyond belief, not because they're particularly good at beating the market (they do worse on average), but because they've convinced some very wealth individuals to lend them their money and have charged them high fees....it's amazing how stupid rich people are with money. Many of those hedge fund investors would have doubled their return just in low-risk US treasuries.

[elgordo]

I'm looking at a fund started by a friend that has done pretty well, but the minimum to enter is insane- 6 figs. Apparently it's averaged 4x over it's life... But again- I don't know shit about that world so I'm treading lightly.

I'm like hood rich

[DepthsAbove]

If someone has a successful business model figured out, I'd say there's little reason to throw much money at the market...maybe 10-20% of net worth, or 33% of liquid worth. If you can buy real estate at a reasonable price, and rent it out for a worthwhile profit, generating a monthly dividend for yourself, that seems good to me. If you're counting on the house to appreciate, that's playing with fire, although the same could be said of counting on stock appreciation.

[Hans]

a fund started by a friend? steer clear...

never mingle money with friendship

also, just because a fund has done well recently doesn't mean it will do well tomorrow. that's called performance chasing, and is generally bad investment behavior (investments that have done well recently may be overvalued)

hedge funds mostly require even higher net worths -- 7 figs and above, but over the past 13 years or so have a total return of 16% (that's not annualized, that's total), so they've lost out to inflation rather significantly.

[Hans]

DepthsAbove, on 06 February 2012 - 04:21 AM, said:

If someone has a successful business model figured out, I'd say there's little reason to throw much money at the market...maybe 10-20% of net worth, or 33% of liquid worth. If you can buy real estate at a reasonable price, and rent it out for a worthwhile profit, generating a monthly dividend for yourself, that seems good to me. If you're counting on the house to appreciate, that's playing with fire, although the same could be said of counting on stock appreciation.

If your earnings growth rate is better than most companies, it makes sense to funnel that money back into your business if it requires capital reinvestment.. If your business has a high growth rate and doesn't require reinvestment of capital, then it makes sense to diversify and build up a portfolio of stocks and bonds.

In general, it's good to have at least a small portion outside of your business, just for diversification and a hedge against your business going south.

[DarknethConthumed]

hans you're pretty awesome at this why can't you be this cool with console wars?

[Fatghost28]

What kind of business do you do elgordo?

[Liquid]

Libertardians crusade against a versatile currency system that isn't bound by a fucking metal never ends. If you wanna see what happens with an immobile currency system like gold in a modern economy all you have to do is study what euro did to southern europeans.

And gold is just as susceptible to market scams as normal currency. We don't have to eliminate the currency we have to eliminate the fucking bankers that attack the worldwide economy to make profit. And when I say eliminate I mean catch them and shoot them in a dark cell. Putin made a good start by issuing an arrest warrant for that scumbag Soros.