What's the composition of the NASDAQ ?
These 10 stocks, represent a bit more than 50% of that stock exchange:
- APPLE INC.
- MICROSOFT CORPORATION
- AMAZON.COM, INC.
- TESLA
- ALPHABET INC.
- NVIDIA
- PAYPAL
- COMCAST
- ADOBE INC.
By taking a look at the names on that list, we can see that most of the high-margin and highly predictable stocks are listed on the NASDAQ.
So, for now, my performance is not as good as the S&P. But I own businesses that are first-class and it took me years to reach that. It wasn't that complicated after all. I just thought I could find gold nuggets by myself. But I couldn't do that. It was just a fucking dream.
As of may 2021, I stick to the NASDAQ for more than 75% of my portfolio.
Correction: More than 60% of my portfolio. I'm not even able to add simple numbers. Don't trust me too much.
I have decided I am not smart enough to beat the S&P500.
RépondreSupprimerMy portfolio is 90% in two ETFs: One tracks the S&P500 and one tracks the FTSE All-World Index (about 50% S&P500 and 50% large and mid-caps globally).
The only individual stocks I own are V and MA, which are long term holds that don't make sense to sell due to tax implications.
The risk with pure indexing is drawdowns, especially if you are buying at the top. If you put your money in NASDAQ now you are buying the index very close to the top, and the NASADQ is more susceptible to drawdowns than the S & P. It takes a huge rise, and much time, to recover from a 50% decrease, and a lot of fortitude to hold on. Old Warren of Berkshire Hathaway fame understood that. With the S & P 500, you only get a 1.5% yield - not much money to take advantage of buying opportunities should they present themselves. Good luck, I hope you will continue to blog even if you are indexing. You are a very good stock picker and business finder, and there is a lot of value in that. All the best.
RépondreSupprimerMany times I have thought of doing this myself. One idea is to use funds from your Nasdaq 100 holdings and buy the individual top holdings when they tank. When they rise up more than the Nasdaq, do the opposite. I've done this with Google and QQQ.
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