fantasticshower

Thanks for that first link. I'm interested to see what the conclusions are.

Could a diet where you only eat the meat from one slaughtered cow be the ideal vegan diet? One consciousness killed.

This approach would require purchasing a half from a local farmer who raises 100% grass fed animals and makes his own hay.

The hay definitely kills some animals when harvested though. It would be interesting to quantify the death impact (calories of beef produced per bale of hay) of a hay harvest and compare that to the death impact for some staple vegan foods, and see how things stack up.

Edit: The need for hay is a climate based one. There are places where cattle can graze for more or less days in a year. Hay is used a winter feed in places where winter forage is unavailable.

I should probably finish reading it but doesn't "Guns, Germs and Steel" give a totally non-racial explanation for what they are saying?

Part of me hates Walmart and part of me loves it. I love that I can go to one place and get 80% of whatever I'm looking for. But I also like the specialty stores my town has. N of one but since Walmart moved in ~20y ago I haven't noticed much changing with the makeup of small businesses. Since Walmart moved in there have been more of the other big box stores, though.

It is your opinion that your filters and methods for discerning truth or value are correct. But you think they are the method. We disagree about the methods obviously.

Because we disagree you think there's something wrong with my critical thinking and that I'm unaware of biases. But are you aware of your own?

Typically what we criticize in others is what we fear about ourselves.

I don't know you but I think you have categorized me as one of "them" (people who don't think critically) and have been arguing with me from that perspective.

I think you have a rigid idea of what the right idea is with investing and there's some resistance to anything that might challenge that. I understand why you'd feel that way. There's comfort in believing your filter and your method for gaining understanding of this complex world is totally correct. I find myself thinking that way sometimes too!

It's so interesting to me that your conclusion about me is that I'm not a critical thinker. If you knew me in real life you'd rank me among the most critical thinkers you know (or my whole life experience is wrong).

I think it speaks to the medium of communication we're using (you've misinterpreted things I've said as one problem with the medium), mixed with the topic being a very emotionally charged one.

More examples of you assuming the worst about me. I'm well aware of what you posted.

My sarcasm didn't go through. I mean no one has written a published and cited paper about our conversation. Therefore no one should make any decisions based on our discussion.

Probably best to just ignore everything we've both said (including this advice). There haven't been any published and cited papers about this thread yet so it's too early to tell whether there's anything of value here.

For anyone left reading, let this be a live demonstration of how it can be a waste of time to try to convince someone on the Internet their thinking is wrong.

I'm pretty sure Zetice hasn't changed their mind on anything. I haven't really changed my mind on anything.

I still think the things we linked to are valuable. For those of you who have filters that let the information through, I hope you find something useful. Read the paper Zetice linked to and see what questions you come up with. Or don't.

I guess we'll have to disagree about whether I'm capable of investigating their claims. Maybe you aren't and that's well and good for you. If you cannot investigate their claims, I don't think there's much more to discuss on this topic.

Thanks for the lively discussion, Zetice!

It's a logical fallacy to assume what they are saying is false because they might stand to profit from it. They might be biased but can't we investigate their claims independently?

We certainly have different types of filters. Your filter apparently catches blogs and that's fine. I feel I've been exposed to many interesting things on blogs. I'm sure others would agree.

Your model/filter may be better because you don't have to think about as many things. There's certainly more information out there than one has the ability to ingest. In my experience many things I thought were settled turned out not to be upon further inspection. A simple filter might be good enough for your purposes!

I think your ideas about investing can be correct (in that they produce favorable outcomes) and other ideas can be correct too.

Not a perfect analogy, but Newton's ideas about gravity are correct to explain a lot of things. Einstein's ideas expand and explain more. They are both correct, depending on the level of detail you need. Sometimes "correct" roughly equals "useful".

You may just ignore this (dear thread-reader may not!) since it's on a blog but how do you fit this into your mental model of market phenomena?

https://allocatesmartly.com/diving-deeper-does-the-day-of-th...

If you're open-minded, give the paper a read. They suggest a method, that you can verify yourself, for figuring out which months are likely to be worse.

The paper you shared defines "in the market" as long equities and "out of the market" as long T-bills. The paper I linked looks at other assets you could rotate into besides T-bills. How could that one change (they offer several other ideas) impact the results of your paper?

If that's not interesting to you, skip the paper I linked.

Personally, I believe that type of research is still valuable. I don't structure my life just based on things in published and cited articles.

A lot of people would be better off it they just took a $100 a month and put it under their mattress, i.e. throwing money into a pit. There are obviously many better ideas than that.

Thank for for that paper, I'll give it a read.

The next line in Seyhun's paper is more interesting to me and the focus of my research and strategy:

If the 10 worst days are eliminated, the annual return jumps to 14.06%, and the cumulative return increases to $44.80. With the 90 worst days out, the annual return rises to 21.72% and the cumulative gain to $325.40.

I believe this paper describes a strategy that accomplishes that goal relatively well: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4346906

I'm not sure why I feel the need to convince you. I think your confidence in the face of contradictory evidence that I've seen triggers something on an emotional level for me. I also feel confident I am correct but you disagree.

Hopefully you, someone reading this thread, or I get something beneficial out of this, though! I hope you are successful with your investments and they give you peace of mind.

I'll admit I haven't read the book completely or in a long time but is it not about how the EMH is true and so anything other than B&H low-cost index funds is a fruitless pursuit? Doesn't he back that up with the random walk theory of asset prices?

Instead of me assuming I know what you mean by the methods, would you mind stating what they are?

I think we could agree that some of them are:

* Have a sound plan (I'm sure we could debate what makes a plan sound)

* Stick to the plan

Perhaps they were some of the most functional humans despite their alcohol consumption.

I don't believe the EMH is settled nor that markets follow a random walk. There is academic literature to back up both sides of both of those beliefs.

Things aren't as settled as you make them out to be, and that's OK. What's important is that you have enough confidence in your methods, whatever they are, to stick with them. In the end, the stickwithitness may be more important than what you stick to.

For the curious thread-reader, here are some websites that offer ideas that might make you question whether all "timing the market" is the same and equally bad long term.

- https://portfoliocharts.com/portfolios/ (one step up in activity from B&H one ETF forever)

- https://allocatesmartly.com/blog/ (another step up in activity from sticking to one asset allocation that you simply rebalance periodically)

- https://qoppac.blogspot.com/p/systematic-trading-start-here.... (several steps up in complexity and activity)

I am more worried that when I want to start selling them so I can retire coincides with the beginning of a long drawdown. I suppose one way to address this risk would be to save even more and don't retire until you have way more than you calculate you'll need.

I think we're agreeing that you need a strategy and you need to stick to it. Where we differ (I think) is you think my strategy is objectively bad and yours is objectively good. I don't think we really know what each others strategies are though.

I'll assume you're a proponent of B&H SPY and continuing to buy $X/month of SPY until you retire. I'm just saying there are other ideas than that that you can use that have smaller drawdowns and comfortable returns to risk. You could B&H 60/40 SPY/treasuries for example.

Is it active management if you rebalance 60/40 once a year? What if you rebalance quarterly? At what point is it active management and therefore bad?

I do think it's important to be aware of our emotions when it comes to money and investing. I've realized that I won't be comfortable enduring drawdowns much more than 20% and so I've found alternative strategies that let me sleep at night.

We all choose what investment strategy to follow. I have chosen other strategies that have smaller drawdowns.

In the case where I have to tap into my retirement account because of unlucky life circumstances, I'm happier that I'm selling something I bought for 100 at 75 vs having to sell it at 50 (hypothetically).

It is thus to your advantage if the ETF is really low for a really long time.

As long as you don't start retirement at the beginning of one of those decade-long periods where the market is flat. It would hurt to have to start selling shares at 50 when you bought them for 100.

I hear people say, in finance and in other domains, that sticking to the plan is the key. I think it's an essential principle to keep in mind to be an effective human.

Many diets will work if you'll just stick to them. Find an investment strategy you that lets you sleep at night and stick to it for decades. To steal a phrase from a diet book, "compliance is the science".

It seems kind of like circular logic to me.

What is the market? The market is something like the returns of the S&P 500 index. How do we get the returns of the market? Make a fund that tracks the S&P 500 index. Why do we have funds that use market-cap weightings? Because we want to track the market.

I guess it's not about having an equal representation of companies or industries or sectors, it's about having an equal representation of where dollars are allocated. The goal isn't to take a dollar and buy a share of each company, the goal is to take a dollar and buy more of the companies that other people own more of and less of the ones they don't?

My point is market-cap weighted index funds are an investment strategy and not some neutral default thing that people seem to think they are (or maybe I'm projecting).

I held all my stocks because, well, what else was I going to invest in?

I recently learned about a class of investment strategies called tactical asset allocation. One aspect of TAA is to switch to some other asset when your main one isn't performing well.

It's a form of market timing but it's systematic and backtestable. Reallocating once a month, a lot like a rebalancing that even B&Hers probably do.

This site [0] has some interesting articles on their blog. HAA has really piqued my interest [1].

[0] https://allocatesmartly.com/what-we-do/#whatistaa [1] https://indexswingtrader.blogspot.com/2023/02/introducing-hy...

My thinking used to be this way but then I experienced some things in life that made me consider the non-zero possibility that something could happen to me that would require me to tap into retirement savings. If my retirement strategy involves waiting out large drawdowns, then there's a chance I would need to tap into my retirement accounts at the bottom of a large drawdown. I like the comfort of not having to endure large drawdowns for that reason.