I'm a novice investor; I'll admit that. I am a one man business owner so I don't have time to sit at the computer for large portions of the day and trade stocks. So, I put money into index funds. Boring, I know; but better than nothing.

The S&P 500 and small cap index funds I have with Schwab are running at around 5% since I opened them at the beginning of the year. While that's better than 0% or losing money, I wonder if I should be more specific with my fund types. Maybe AI related? I'm OK with some risk, but I don't want to go overboard.

If there are mutual fund folks here, I'd love to hear your thoughts.

Thanks.

I would just wait a couple months before I buy anything. I suggest you just google the types of sectors you want to be in. In this day and age, it's pretty straightforward.

Thanks, y'all.

I am not a trader. I buy and hold.

I own QQQ, IVV, and XLC.

But I am a huge believer in individual Tech stocks, which include NVDA, AAPL, AVGO, ARM, & MSFT.

Big fan of energy as well: XOM, OKE, and some Mid Streams

My biggest mistake was selling MU a couple of years ago when it was around $100. Obviously, that's the one that got away.

Good luck with whatever you opt to do!

scd88 said:

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I'm a novice investor; I'll admit that. I am a one man business owner so I don't have time to sit at the computer for large portions of the day and trade stocks. So, I put money into index funds. Boring, I know; but better than nothing.

The S&P 500 and small cap index funds I have with Schwab are running at around 5% since I opened them at the beginning of the year. While that's better than 0% or losing money, I wonder if I should be more specific with my fund types. Maybe AI related? I'm OK with some risk, but I don't want to go overboard.

If there are mutual fund folks here, I'd love to hear your thoughts.

Thanks.

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I assume your small caps are vastly underperforming then because the S&P is up 13% YTD. And what small cap are you in?

My small cap is up 21% YTD.

Funds are great; pretty much my entire investing history is in funds with some outlier individual stock plays along the way.

This sounds like the funds you are in are just performing terribly vs the benchmark.

I bought some QTUM (quantum computing) ETF shares over a year ago. It's been a solid play.

Don't buy a lot, but for a buy and forget it index, I think it'll be a good ROI.

When we get quantum computing with the next gen A.I., that's when we all die. At least enjoy the run up.

Thank y'all very much. I have a SEP through an Edward Jones friend. I know it costs money but I'm good with the performance so far.

The index funds are just regular funds; no IRA, SEP, etc. I've always been a time in the market, dollar cost averaging person. I put money into both when I can but my goal is 3 to 4K per month between the two with most of that going towards the SEP. I don't qualify for a Roth.

Total Stock Market and S&P 500. Boring but highly effective over time. The growth of tech already strongly influences the performance of these funds (35-40% of their market cap is IT), so I don't really suggest doubling down by adding separate tech as that starts to get you really tilted to one industry

scd88 said:

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Thank y'all very much. I have a SEP through an Edward Jones friend. I know it costs money but I'm good with the performance so far.

The index funds are just regular funds; no IRA, SEP, etc. I've always been a time in the market, dollar cost averaging person. I put money into both when I can but my goal is 3 to 4K per month between the two with most of that going towards the SEP. I don't qualify for a Roth.

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Do us a favor and share the funds you are in. If you've only made 5% YTD then your Ed Jones guy is picking horribly for you. No offense. You are leaving mucho money on the table.

Also, you do qualify for a Roth if you think you don't do to salary. You can do a backdoor Roth and if your Ed Jones guy doesn't know this then he's really doing you wrong.

Just trying to help!!

Fair questions. My index funds are Schwab and I opened them in January. The Jones guy doesn't mess with those.

SWPPX and SWSSX. Over the past year, the PPX is at 10%, but 6% since January including today.

I need to know more about a back door Roth.

scd88 said:

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Fair questions. My index funds are Schwab and I opened them in January. The Jones guy doesn't mess with those.

SWPPX and SWSSX. Over the past year, the PPX is at 10%, but 6% since January including today.

I need to know more about a back door Roth.

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Are you looking at this correctly? SWPPX is up 13.83% YTD. It's actually beating the S&P by a point YTD.

Look up backdoor Roth at Schwab. You should simply be able to fund your Traditional IRA first and then turn right around and transfer that into your ROTH account as soon as your funds settle in Traditional IRA. There is no real salary limit on Roth. It's fake news, frankly.

I'm quite sure Schwab has a How To on how to do it. You just need a Traditional IRA and a Roth IRA account opened and you are good to go. Should be able to do it all online with a few clicks of a button.

Caveat: if you've previously rolled a 401k from employer into your existing Schwab IRA accounts there are tax implications with that, but if you haven't done that you are good to go.

Thanks, man. I must be looking at it wrong.

Good info.

One fund, and one fund only………VTI.

It's not about picking the absolute best funds and trying to diversify or add additional focus 99% of the people. VTI is diversified.

What's most important is how much you put into VTI each month and how long you do that over many years.

I retired on it and VTI will be my only stock fund the rest of my life.

I put my HSA contributions into SPYM. I used to put it into VOO. Other than negligible expense ratios, are there any advantages using one index ETF vs another?

SWPPX is up 13.8% YTD if you were invested on 1 Jan. Keep it. Add to it. If you want to buy some individual stocks stick to established names, the % of folks making money trading penny stocks is really small.

RightWingConspirator said:

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Other than negligible expense ratios, are there any advantages using one index ETF vs another?

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This will not apply to 99.999% of individual investors, but there was an interesting story in today's Money Stuff podcast about exactly this.

Institutional investors who hold the S&P 500 and are subject to dividend withholding apparently do a trade to deliberately avoid receiving the dividend. BlackRock IVV pays its dividend about a week before Vanguard VOO, so they will move from IVV -> VOO before IVV pays its dividend and then move back before VOO pays its dividend. There's a bit more to the story of "why" in the podcast.

If it's one fund to buy and hold, I choose VT for the global diversification. US stocks have outperformed the last couple of decades but that's not always the case.

TriAg2010 said:

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RightWingConspirator said:

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Other than negligible expense ratios, are there any advantages using one index ETF vs another?

---

This will not apply to 99.999% of individual investors, but there was an interesting story in today's Money Stuff podcast about exactly this.

Institutional investors who hold the S&P 500 and are subject to dividend withholding apparently do a trade to deliberately avoid receiving the dividend. BlackRock IVV pays its dividend about a week before Vanguard VOO, so they will move from IVV -> VOO before IVV pays its dividend and then move back before VOO pays its dividend. There's a bit more to the story of "why" in the podcast.

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Taxes.

Burdizzo said:

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I have been ratholing money into an index fund since 1992.

When the market went to hell in 2008, I stayed the course. For a year or two after 2008 I could see that downturn as it got smaller and smaller. Today it looks like noise on a straight line.

Unless you know something most other investors don't know, index funds are very hard to beat.

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Anyone (like you and me) who stayed the course during the Great Recession rocketed out of that on the investment front.

If your horizon is a long one, like mine was back then, a recession can turbo charge your net worth.

RightWingConspirator said:

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I put my HSA contributions into SPYM. I used to put it into VOO. Other than negligible expense ratios, are there any advantages using one index ETF vs another?

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If you want to sell covered calls spy has way more liquidity than voo but for buy and hold go for the lowest expense ratio.

I'm an RSP fan as I think equal weight offers better diversification than market cap weighted. I keep a 100 share SPY and QQQ position to write calls against, but RSP is my core.

If you are looking at a S&P 500 fund for low service fees and looking to buy and hold over the long haul I would recommend SPYM and if you have a fidelity account then the Fidelity 500 fund

The best starting fund for equities is VT, which includes US and global stocks, you can alternatively combine VTI with VXUS which has some tax advantages for the foreign tax credit

VOO
QQQM
SCHD
VT
XLE