18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,608 Blog Posts

This is How You Invest For Long Term

I was going to post a bunch of graphs and data to cajole you absolute fuckheads about how to invest your money for the long term — but opted instead to just talk plainly.

As some of you know, I used to do this professionally and quit the business in 2017, right before markets melted up and everyone got rich. At any rate, there are some core tenets you need to understand about investing, if doing it for yourself. BTW: I used to really believe YOU (unwashed reader class, self directed catamite) could do it on your own and advisors were superfluous. However, the problem I have begun to accept is too many of you do not fear losing money, unlike advisors who are under regulatory scrutiny. In other words, you’re just as smart as an RIA but the RIA is afraid of mismanaging your funds because he’ll be fined/go to jail. This is an important impetus and you really should treat your own money as if it was someone else’s and if you fuck up — you’re going straight to jail — no bail.

Enough rambling: here are the rules.

Position sizes should be 3-8%. Anything lower should be increased, anything higher trimmed. When putting together a core portfolio it must be diverse. Unlike in America, the investment world is really better when diverse. It quite literally is your strength. This means you don’t just buy $ADBE, $INTU, $CRM and $AAPL and call it a day. Sure, those stocks would’ve made you rich the past 10 years — but you must invest today for the future not the past. This means gaining exposure to staples, basic materials, industrials, even utes is a must.

Market caps should not be less than $10b, generally. You might have a favorite growth stock that is small — but those fuckers can be placed inside a basket of other stocks comprising of a full allocation of 3-8%. A stock like $PLUG should never be a pillar in a long term account — no matter how much you like it.

Philosophically, you should invest your account as if you were about to die and the children you leave it to are either too young or stupid to manage it after your demise. The stocks should be rock solid FCF positive names and those stocks should be left alone to grow and not micromanaged to accommodate your feelings. This means, whenever you really believe markets will crash and all is lost — you step the fuck away and eat a sandwich.

Trust the process and assume the rigged markets will continue to be rigged in your favor — especially since you’re long stocks that are central to current hegemonic rule.

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