For me it's simple: The entire point of "passive investing" is that you don't decide whether the market is too hot or undervalued. That would be active investing, however mild the "active" component is.
In an unprecedented bull market ofc. Some people are neglecting putting their gains towards more education or paying off long term debt because they see the unrealized gains tho & think they’ll be missing out or something, and I think that’s something we should address as responsible people looking to better our communities Edit: misspelling of bull mkt
Dollar cost averaging is the way to go for passive investing. No one knows when the next market drop will be. Don’t play the guessing game, play the long-term game of averages! Great content man, Bogle is super underrated.
@NihlusGreen Lump sum investing could very well work too. Even though DCA has produced better results in the past, who’s to say lump sum investing won’t work better in the future.
@NihlusGreen DCA is the opposite of timing the market. Not everyone has a lump sum to invest for their life at once. Comparing lump sum to DCA is apples to oranges for the average investor.
@@elinsd Timing it perfecty actually is still worse if you kept saving all your money until the perfect time to invest it all. In that case you'd be better off just investing every month, because you have more time in the market that way
I love the simplicity of Bogle’s wisdom on investing and using index funds. I have followed his strategy for years with great success and using etfs just makes my life and investing so much easier and I don’t need to worry too much about stock market crashes as I just need to focus on the long term. Stay the course!
"Compound interest is a miracle and time is your friend". Sadly, I understood this in my late 20s. But I am happy that I finally understood how much a small investment every month can create a substantial wealth after 10-20years.
We seriously keep down playing 20s and 30s like these two ages are the cut off mark. You literally start adulting in your 20s 2 years after become a legal adult. By 30, you have a whole decade to get it together if you havent already. Reality is you should be concerned or disappointed until you reach late 40s or 50s and realize you havent done anything. Relax you are ok and everything will be fine. Keep learning and growing in your 20s and 30s. This whole retire in 30s BS is few and far between and unrealistic on a mass scale.
I’ve watched a handful of your videos and I must say: change nothing. Great content without sinking to the level of constant click bait crap “market crash” this “game over” that. Keep up the great work, love your clarity and integrity! One of a very select few respectful content creators, cheers!
Depends if you need the money back quickly or not. If you need the money within he next 5 years, I'd say that's extremely risky because a 2nd crash is possible with the drawn out pandemic.
Very stoic for someone to bring up essential topics about the stock market while not sharing his expertise, but highlighting the tips given by the investors we look up to who have decades worth of experience.
It makes sense cuz “all time highs” are all relative. 2008 “all time high” seems like a blip in a linear line now. We will look back in 40 years and today’s high will seem like a blip cuz of mass inflation, smarter investors due to increasing financial literacy, better technology across all sectors, etc.
@@sapinva Yes, I added to my dividend stocks and bought some silver and gold. I also added to municipal bonds. I am diversifying more. I have a decent amount of growth stocks for sure.
"Consistently dollar cost average the Total US stock market Index" - Sounds so simple, but its NOT. There are a lot of distractions (get rich quick) out there.
And there lies the only part that is not simple. The human irrational response. Most of the time when you realize something can get you huge quick returns you’ve already missed it and are more likely to get caught in the correction of that volatile stock and lose money.
@@Biancoo Remember the old saying they couldn't see the forest for the trees? You wouldn't know a ponzi if it fell on you. Today's stock market makes the summer of 1929 look like a stellar buying opportunity.
@@parkerbohnn Yea you probably right , stay out of it , you are missing out my friend , if the stock market of america is a scam., probably all america is a scam then , never heard more stupid thing.
Mate, please do a video showing your personal steps for creating an automatic monthly investment plan. Bank > Possible Fund/s > how the cash flows/allocation. Show the possible steps not the actual investment (you are not giving financial advice, only a possible method) - You will help many many people to invest.
ETFs are useful in instantly diversifying an investor’s income portfolio, Investors should focus on buying top stocks breaking out past correct buy points.
Through proper financial planning, there are more people achieving financial freedom faster today than ever before and the stock market is the best place.
The market isn’t priced at intrinsic value 90% of the time. Speculation is built in to the price it’s just now much speculation varies. The market goes down not usually to meet intrinsic value but to meet future speculation
@@rateme6166 no the idea is that’s it’s based on current performance of the actual business in terms of earnings. Not the stock itself. And what I’m saying is the stock doesn’t go down to its intrinsic value as a point of equilibrium because speculation of the future is always also included.
@@astrahl hmm, im not too sure on this but isn't a stock a share of that business in terms of its performance including its earnings etc? or is there a distinction between the stock itself and the business
1. Make bad decisions 2. Act upon emotion, not reason 3. Doing basic math is impossible 4. Only fund managers know how to charge you to not beat the market, including index tracking ones. 5. Earnings yield doesnt matter. 6. Time in the market is better than timing the market (says everybody who charges an expense ratio ever)
The whole thing is insane. They've made debt interest lower than inflation interest. Anyone who has the means to borrow can basically just steal money from everyone else.
Great video! Very well structured. I take away for passive investors from this video the following : Invest 50% or a portion you like TODAY. Then when the bubble burst then buy the rest of the percentage. The
The other piece of advice is : stay employed and ensure you have sufficient cash reserves to meet daily expenses. This is the often unspoken corollary to long-term passive investing.
I do my best to DCA, but then when I get excited I just remind myself lump sum is better :P Edit: Better as in, more beneficial more of the time. It isn't ALWAYS better.
@@SageFinance For sure! No matter what I do, I still have the 403b, so I am always DCA to a degree. I just like to have fun managing the Roth IRA (No selling, just buying).
@NihlusGreen I’ve found sitting around waiting for the market to drop is worse because you miss out on the opportunity going up - Time in the markets is the way to go 🙂
At 16:00 fundamentally incorrect calculation; We need to consider averaging. If in 23 years, the returns are ~4x which means that we had 2 exponenting over 23 years' period. This implies CAGR of ~5-6%, which is not true for S&P500 for the duration 1997-2023.
Great video. I'm glad because after studying all by myself on the web many hours a day for 3 months, I discovered etfs and Jack Bogel. To me he is the one who democratised investing and I think he (Vanguard) deserves our business.
Jack Bogle, underrated investor IMO. Totally agree, he doesn't get the same recognition as someone like a Warren Buffet or a Charlie Munger. Great video man!
I think he means that you show up to constantly keep putting money in...... For instance you might do a lump of a few K you saved up in the beginning and fill it up monthly with some hundreds. Since savings accounts don't really have interest rates... its better to just put that money to use. I don't arue for DCA here, but I also see a point where you might feel a bit scared about investing so that is a good reason to do it.. and get used to putting up montly investments.
I disagree. Let's say I want to buy an ETF like VOO, but I believe the S&P500 will average negative values the next year? Why should I risk losing a percentage of my money in the first year if I can just wait it out?
@@nonamed56 that's the worst idea you can do. Trying to time the market is a very bad strategy. If you are trying to get VOO, set up a recurring investment each month over let's say this year, if the market is going down, you are buying it cheaper and cheaper, if the market rebounds next year, you'll have great gains. Because you have essentially did a strategy called dollar-cost averaging. Take it from me, while you are waiting to find the right time to enter the market, that time might never come, or might come 5 years from now, who knows.
Tôi đã xem toàn bộ video này và thực sự rất thích nó. Cảm ơn bạn đã chia sẻ những thông tin quý báu về cách đầu tư và những lời khuyên từ Jack Bogle, người đã thúc đẩy phong trào đầu tư passively thông qua các quỹ chỉ số với chi phí thấp. Bài học quan trọng mà tôi rút ra từ video này là sự quan trọng của việc tiếp tục đầu tư dù thị trường có đang ở mức cao kỷ lục hay không. Thời gian là người bạn đồng hành của các nhà đầu tư passively, và việc duy trì sự đầu tư theo thời gian dài có thể tạo ra lợi nhuận ấn tượng. Tôi cảm ơn bạn đã chia sẻ video này và hy vọng bạn sẽ tiếp tục sản xuất nhiều nội dung bổ ích khác trong tương lai. Cảm ơn bạn rất nhiều vì đã mang lại kiến thức giá trị này cho cộng đồng đầu tư.
What I feel like people forget, that might be good to clarify in future videos when you show the historical up and downs... is that you're buying more that entire time, so while it makes those dips painful, it also means the run ups are that much more powerful as well. I think people see the up and down across a horizontal axis and they think "what progress did you really make?" not realizing you own another piece at tons of segments in-between, not buying all in at once and then riding it out forever...
Yeah 100% agree. you might lose 30% on the way down but if you buy more on the down trend the approx 10% uptrend can mean money back and profit at 11% or so.
Looking at this video on June 2022 is amazing! I am in my 50's and just started investing in stocks, ETFs, etc. At least, I will teach my 16 years old doughter.
I know that this might sound too clever. Why not buy the index fund when the index is below its fair value i.e. 13 P/E or 4% dividend as Jack Bogle said here. When the index is above 13 P/E or 4% dividend then put the amount of money you would put in every month into a separate cash account. Then invest twice as much each month when the fund drops below 13 P/E or 4% dividend until the cash account is used up. Take half the money from your bank account and the other half from your cash account. Keep doing this. I would have thought that you would make more money. You have to stick to the discipline of course. If that is too hard then do just what this video says.
And that's just the index return over the 23 years after Jack Bogle's speech.Which is impressive enough.It doesn't take into account the dividends that would have accumulated over the years that when reinvested would have produced a far higher total return.Even with a low yielding index like the S&P, compounded dividends really accelerate the returns.
Thank you for the video. I made some errors in my lifetime and I have emphasized these errors to my kids. My only hope is they will learn from my mistakes.
When people say that the stock market is expensive they need to contextualize it with alternative types of investment, are stocks expensive compared to real estate? are stocks expensive compared to minimal fixed-term deposits interest? are stocks expensive compared to minimal bond returns? are stocks expensive compared to 1 BTC > 50k USD? are stocks expensive compared to cash with >40% M1 created during the last year? we are seeing the results of expansionary monetary policy. it's not like people think the stock market is cheap, is just that they don't have anything better to do with their money.
The market can go sideways and down from really long periods of time. There have been several times in the past 150 years where it to 10 to 20 years for market to regain previous highs. Also Japan had a lost decade in the 90s after Huge QE and arguably still hasn't really recovered. Having said that I still think this Bull Run has a good set of legs in it good for a couple more years - so BUY BUY BUY!
This is a great video. The cherry on top would have been the comparison of the current purchasing power of the 10K invested in 1997 vs those same 10K left in a safe (that is, not generating returns and being left subject to inflation). Edit: Did the calculation myself. To have the same purchasing power of those 1997 10K in 2021 you would need 16.7K. But since you didn't invest them, they are still 10K, which means you are now 6.7K short (that is, you lost 67% of your capital), whereas you'd be over 100% richer if you did enter the market back then. This is of course a worst case scenario. If instead of leaving the money in a safe you left it in a bank account in a certificate of deposit you might still be a little better off. Not much, though.
Whole heartedly agree with Bogle, Buffett and this video. With one addition to the philosophy...particularly when your pot of money has grown into a tidy sum, and you’re getting ever closer to retirement. Pay attention to the 200 day moving average. History has shown that if you sell out of equities when the index falls below the 200 day and buy back in when it rises back above again, you will have preserved more of your wealth. You limit yourself to a 14 or 15% hit rather than a 20-30+ % hit. This strictly applies to your existing pool of money. I am still a buyer all the way down picking up ever cheaper shares along the way. Once the 200 day MA is hit going up, go all in again with your positions. This strategy has worked all the way back to the great depression up to and including the big COVID sell off last March. This advice is for those trading in an IRA or work 401k type plan where there are no tax implications. You would likely not want to do this in a regular brokerage account as the capital gains might kill you.
I have seen people lose thousands on their work 401k in the past when the market crashed. I am almost at retirement age and switched my 401k to a more less risky option as this bubble may come crashing down and i do not have the time(age wise) to rebuild it up. I will play the market on the side and keep my hard earned 401k money .
@@METALADIX Not exactly true. An ETF that has a yearly average of 5.8% could have a negative year in there. If someone pulls out their money before that negative year (let's say immediately before), then how are they losing money?
I started stacking to SAVE wealth. I've always been the type of person to spend my entire paycheck. I hate having money just sit in the bank. I am under pressure to grow my reserve of $950k. before I turn 60, I would appreciate any advice on potential investments.
thanks mate, great timing for this :) what actually makes me worry is not the market fuss but the australian-chinese relations because is already starting to effect real estate and mining. If you could make a video about it, it would be awesome.
Don’t just do something! Stand there! Jack bogle. Thanks jack! My first mil thanks to you! Great video btw. I see when your video was made. Market went up quite a bit then rates raised, now back up again. I blew up your chart. Thanks
Keep asking the question because this video does not answer it with any satisfaction. He doesn't even mention the many warnings that Jack outlined in the 90s. It's simple advice, from an inexperienced investor, who ignores all the counterpoints. Keep researching
EV stocks and cryptos have been leading the race for months now. But most people pay more attention to the shiniest positions on the graph to the cost of proper diversification, making investing look a lot more difficult. Having monitored my portfolio performance smashing a jaw dropping $280,000 from the last 2 quarters, I have learned why experienced traders make enormous returns from the seemingly unknown markets.
Hey bud, I find myself in a fix right now and I need proper advise. I have a lump sum of around $400k, an inheritance sitting in a savings account right now doing absolutely nothing at all. I wanna get something started with it but I need guidance on where and how. You seem to be doing excellent for yourself. I could use some help here.
@@leonardn9621 I don't give my money to anybody. My account only mirrors her trades in real time. That's the ideal. The lady I just recommended is a renowned broker and knows what the heck she's doing. Check her out and get in touch if you'd need help.
Great and timely video. Your return on 10k invested in 1997 is incorrect, it is actually more than double 40k, it is 87,535 today, IN VFINX, VANGUARD INDEX 500.
I bet part of it is because everybody is getting into investing now. So there's just a lot more people plugging money into the stock market regularly. And that's probably partly what's causing the stock market to be at an all-time high
No, they don't have enough to move anything. It has everything to do with the FED quantitative easing which they obviously can't do forever hence interest rates up to 1.35%
Fantastic video as always! Market is certainly going insane currently, given we are talking about passive investing purchasing ETFs now is fine as the key is consistency.
I already own shares of PALANTIR, TSLA, NVDA and APPL as well. Sure, I don't mind having these equities sit around for a while, but I'd also like to appreciate short-term opportunities that could fetch $200,000 or less.
I like that you use basic valuation metrics. Yes jack bogle helped bring low cost funds/etfs to the masses slashed costs and made investing non complicated. Etfs have outperformed 95% of fund managers in the last 15 years. The market is crazy expensive I will wait for larger retracements and bulk buy in at discounts.
These videos are an open invitation to debate and investigate. There's no need to take everything that a person in a video is saying for granted. Always be diligent; stay curious; do your own research; do your homework. Man, such a great channel on TH-cam you have. Hats off!
Hey mate, Thanks for bringing up Jack Bogle!, The man who made my financial perception right on track!. Btw. How can I cut the pie across VGS & VAS. I sit at 60/40 atm. Would love your thoughts on it.
Good video and great explanation of Jack’s thoughts. But your example in the end is not convincing. $10000 in 1997 grows only to $40000......Are we missing something....what about dividend reinvesting and power of compound interest?
I don't think the ASX200 is that over priced. Especially compared to say the s&p500 and NZX50 those are crazy, pretty much tripled in the last 10 years
Thank you! You explained so well. I feel convinced now to ‘stay the course’ -which I set since August 2020 and has given me a 25% revenu. Your contribution is much more interesting than all the predicted financial crisis by the ‘experts’ here on TH-cam. But staying the course should not keep us from beeing flexible. Keep learning and open to change at all times.
If you invested $100 into the S&P 500 back in 1900... It would be worth $8.6 million today If you had saved $100 in a savings account in 1900... it would be worth $2 today Do you see the power 💪 of investing now?
Solid logic, though if we are still following our fundamental strategies that likely does mean in markets like we are seeing now, the number of places to put that money should be fewer. Yes you want to keep investing in 2008, but if you do your proper research, maybe the housing market wasn't the place to put it :p Which makes me think investing your money into the average market now is fine, but I would personally avoid all the incredibly inflated new tech stocks. Put your money somewhere, but not just anywhere :)
Market crash, bear market , all time high bla blah blah ignore all that bullshit. Find a good company, with a reasonable dividend payout , buy and hold.
This is great advice if you are under approximately 35 yr. The reason I say that is because you hear so much about once you are in your 60’s you are less likely to be completely(meaning 100%) in the market. So sure passive long-term investing is great, but really works absolute best if you start young.
1. keep investing
2. time is your friend
3. impulse is your foe
4. stay diversified
5. stay the course
by Jack Bogle
It’s all true
Yes! Just shared my $3m portfolio on how I’m doing just that. 😄
That method has some flaws.
@@Honestly__now Thank you random nobody for the confirmation; I wasn't quite sure to believe it when the tried-and-true billionaire-investor said it.
Thank you for summarizing the points
Minor call out: 1997 to 2021 S&P price growth is 300%, but with dividends reinvested (true return) it’s 500%. Yet another win for good ole Jack
how much is the dividend for S&P?
@@Pale_ghost It depends on the dividends of the stocks that are part of the S&P
Total return with dividend reinvestment from January 1997 to July 2021 is 464.741%.
Do we need to take inflation into account?
Inflation is at least half of that so yes
TLDR: yes, historically the market is often at an "all time high" and it still goes up to a new all time high.
Thanks man 👍
Though sometimes it takes 17 years to hit a new high ..
Also if it drops, your dividend reinvestment could hit at a low and when it goes back up, it’ll bring up your average returns
thank you 2x speed is not enough
Bear markets can last years let’s not forget inflation
If you are a passive investor then today's price is irrelevant. Buy when its up, buy when its down and buy when it goes sideways :)
For me it's simple: The entire point of "passive investing" is that you don't decide whether the market is too hot or undervalued. That would be active investing, however mild the "active" component is.
That's the surest way to lose all your money. When ponzi's implode everything crashes.
I maintain that investing in stocks is still one of the very best means of doubling or holding your funds. Who thinks otherwise? Let's debate. Lol
@@dannywalters958 This is looking like a plug.
Of course it is. Became a millionaire by 36. No inheritance and only make 50-60k in my career.
In an unprecedented bull market ofc. Some people are neglecting putting their gains towards more education or paying off long term debt because they see the unrealized gains tho & think they’ll be missing out or something, and I think that’s something we should address as responsible people looking to better our communities
Edit: misspelling of bull mkt
This is blatantly a coordinated sales pitch.
@@Ulysses042 I think its spam or a scam, seen the same thing in other videos comments.
Dollar cost averaging is the way to go for passive investing. No one knows when the next market drop will be. Don’t play the guessing game, play the long-term game of averages! Great content man, Bogle is super underrated.
agreed! If you're a passive investor just DCA
DCA needs discipline.
@NihlusGreen Lump sum investing could very well work too. Even though DCA has produced better results in the past, who’s to say lump sum investing won’t work better in the future.
@@tpplatfzft I’d argue that all forms of investing need discipline
@NihlusGreen DCA is the opposite of timing the market. Not everyone has a lump sum to invest for their life at once. Comparing lump sum to DCA is apples to oranges for the average investor.
Jack Bogle was a great man and a legendary investor!
Time in the market beats timing the market! ⏰
Timing the market saves you a few bucks but creates lots of trading anxiety and it doesn't pay off.
@@elinsd Timing it perfecty actually is still worse if you kept saving all your money until the perfect time to invest it all. In that case you'd be better off just investing every month, because you have more time in the market that way
I wouldn't want to be the guy who bought in 1999 while my neighbour bought in 2001 lol.
and stock picking by tedious research beats that.
@@Longtack55 Sure but only 2% of people are able to do that succesfully, over a period of 20+ years
Thanks for mentioning Jack, everyone that invested a dollar in a market should know him. Legend.
I love the simplicity of Bogle’s wisdom on investing and using index funds. I have followed his strategy for years with great success and using etfs just makes my life and investing so much easier and I don’t need to worry too much about stock market crashes as I just need to focus on the long term. Stay the course!
"Compound interest is a miracle and time is your friend". Sadly, I understood this in my late 20s. But I am happy that I finally understood how much a small investment every month can create a substantial wealth after 10-20years.
Better than getting it in your 30s, like myself! ☺️
@@vidz953 you are in, better than most ppl!
@@Jack-xk3qp very true! It's all relative, isn't it? ☺️
How does compound interest work in stocks?
We seriously keep down playing 20s and 30s like these two ages are the cut off mark. You literally start adulting in your 20s 2 years after become a legal adult. By 30, you have a whole decade to get it together if you havent already.
Reality is you should be concerned or disappointed until you reach late 40s or 50s and realize you havent done anything.
Relax you are ok and everything will be fine. Keep learning and growing in your 20s and 30s. This whole retire in 30s BS is few and far between and unrealistic on a mass scale.
Thank you for explaining what Bogle said , it was a bit difficult to understand hime
Thank you for bringing this up! Jack Bogle is always a source of inspiration.
I’ve watched a handful of your videos and I must say: change nothing. Great content without sinking to the level of constant click bait crap “market crash” this “game over” that. Keep up the great work, love your clarity and integrity! One of a very select few respectful content creators, cheers!
This is click bait content lol
"The biggest risk is not investing at all". I like it! 💪💸
Depends if you need the money back quickly or not. If you need the money within he next 5 years, I'd say that's extremely risky because a 2nd crash is possible with the drawn out pandemic.
@@godtrader6102 lol
16:33 Correction: You're completely ignoring the dividends. Total return with dividend reinvestment from January 1997 to July 2021 is 464.741%.
Noticed that too. Thanks for calculating!
What's the formula to calculate compound returns with dividend reinvested?
Very stoic for someone to bring up essential topics about the stock market while not sharing his expertise, but highlighting the tips given by the investors we look up to who have decades worth of experience.
It makes sense cuz “all time highs” are all relative. 2008 “all time high” seems like a blip in a linear line now. We will look back in 40 years and today’s high will seem like a blip cuz of mass inflation, smarter investors due to increasing financial literacy, better technology across all sectors, etc.
There is also dividends (compounded). If you bought and held at the top of the tech bubble you probably do better than that.
Today it's not about return ON capital. Today it is about return OF capital
?
Is it that bad?
I’m 58 and wish ETFs existed when I was young and just bought QQQ, SPY and DIA every month. I would easily be over $10 million.
Never believe it’s not acceptable to take a pause. Even the market takes a pause. 👍🏽
Take a pause from irrational investing. There are always dividends and metals, and put aside some cash for new lows.
@@sapinva Yes, I added to my dividend stocks and bought some silver and gold. I also added to municipal bonds. I am diversifying more. I have a decent amount of growth stocks for sure.
J. Bogle was of exceptional honesty and wisdom staying simple.
"Consistently dollar cost average the Total US stock market Index" - Sounds so simple, but its NOT. There are a lot of distractions (get rich quick) out there.
And there lies the only part that is not simple. The human irrational response. Most of the time when you realize something can get you huge quick returns you’ve already missed it and are more likely to get caught in the correction of that volatile stock and lose money.
Dollar cost averaging doesn't work for ponzi's. The U.S. stock market is the biggest ponzi of all time much bigger than tulip bulb mania.
@@parkerbohnn you trolling right?
@@Biancoo Remember the old saying they couldn't see the forest for the trees? You wouldn't know a ponzi if it fell on you. Today's stock market makes the summer of 1929 look like a stellar buying opportunity.
@@parkerbohnn Yea you probably right , stay out of it , you are missing out my friend , if the stock market of america is a scam., probably all america is a scam then , never heard more stupid thing.
Mate, please do a video showing your personal steps for creating an automatic monthly investment plan. Bank > Possible Fund/s > how the cash flows/allocation. Show the possible steps not the actual investment (you are not giving financial advice, only a possible method) - You will help many many people to invest.
Just buy the index fund, forget about it for a few years and you will not be disappointed.
That's a bit too simple. "for a few years" could be 20 years in the bad bubbles of the S&P, or in the case of Japan could be never.
No dont just buy the index fund and forget about it. Buy into the index fund every month and dont check it every day.
@@lukewarmape603 Lump sum investing beats dca most of the time.
@@ctyreman11 literally the opposite but ok
Unless you are Japan
ETFs are useful in instantly diversifying an investor’s income portfolio, Investors should focus on buying top stocks breaking out past correct buy points.
it may be an appropriate time to be looking at industrial stocks now. Especially since some of them are now trading at more reasonable prices.
I’m trying to find top moving stocks that could generate profits.
@@emmageorge3728 You can start building a watchlists, And always look for big percent gainers and probably focus on stocks that are already moving.
Through proper financial planning, there are more people achieving financial freedom faster today than ever before and the stock market is the best place.
Identifying the best stock is tasking, couple with so much volatility with most headline stocks. I almost lost all my money trading.
The market isn’t priced at intrinsic value 90% of the time. Speculation is built in to the price it’s just now much speculation varies. The market goes down not usually to meet intrinsic value but to meet future speculation
how do you determine intrinsic value?
@@rateme6166 it’s a theoretical value based on current performance. That’s why I was saying it’s hardly ever valued there
@@astrahl but current performance is current market price right which is speculative so..
@@rateme6166 no the idea is that’s it’s based on current performance of the actual business in terms of earnings. Not the stock itself. And what I’m saying is the stock doesn’t go down to its intrinsic value as a point of equilibrium because speculation of the future is always also included.
@@astrahl hmm, im not too sure on this but isn't a stock a share of that business in terms of its performance including its earnings etc? or is there a distinction between the stock itself and the business
1. Make bad decisions
2. Act upon emotion, not reason
3. Doing basic math is impossible
4. Only fund managers know how to charge you to not beat the market, including index tracking ones.
5. Earnings yield doesnt matter.
6. Time in the market is better than timing the market (says everybody who charges an expense ratio ever)
The market isn’t being driven up by speculation as much as its being driven up by artificially suppressed interest rates via the Fed.
When will that end?
@@iddicted according to the Fed, not any time soon
The whole thing is insane. They've made debt interest lower than inflation interest. Anyone who has the means to borrow can basically just steal money from everyone else.
Trump tax cuts as well.
@@micblades1117 - Letting people keep their money isn't a problem
Great video! Very well structured. I take away for passive investors from this video the following : Invest 50% or a portion you like TODAY. Then when the bubble burst then buy the rest of the percentage. The
The other piece of advice is : stay employed and ensure you have sufficient cash reserves to meet daily expenses. This is the often unspoken corollary to long-term passive investing.
I’ll just keep dollar cost averaging every week as normal - if there’s a dip I’ll start buying in more heavily. Keep it simple 🙂
I do my best to DCA, but then when I get excited I just remind myself lump sum is better :P Edit: Better as in, more beneficial more of the time. It isn't ALWAYS better.
@@ffnightranger I went lump sum into the etf FANG in April last year and am very happy 😃 Got to take advantage of big market drops!
@@SageFinance For sure! No matter what I do, I still have the 403b, so I am always DCA to a degree. I just like to have fun managing the Roth IRA (No selling, just buying).
@@ffnightranger yep retirement accounts are the best way to invest with instant tax benefits! My contributions are weekly 😃
@NihlusGreen I’ve found sitting around waiting for the market to drop is worse because you miss out on the opportunity going up - Time in the markets is the way to go 🙂
At 16:00 fundamentally incorrect calculation;
We need to consider averaging.
If in 23 years, the returns are ~4x which means that we had 2 exponenting over 23 years' period.
This implies CAGR of ~5-6%, which is not true for S&P500 for the duration 1997-2023.
Great video. I'm glad because after studying all by myself on the web many hours a day for 3 months, I discovered etfs and Jack Bogel. To me he is the one who democratised investing and I think he (Vanguard) deserves our business.
really? i am surprised. i have known this for a long while. but there are other strategy that perform better for a while.
""You miss 100% of the stocks you don't buy." ~ Jack Bogle"
~ New Money, 1/10/21
I like how you explain simple and easy to understand! Thanks for your work!
Jack Bogle, underrated investor IMO. Totally agree, he doesn't get the same recognition as someone like a Warren Buffet or a Charlie Munger. Great video man!
Probably because Jack got rich by inventing the funds not from investing in the funds themselves
Munger and Buffet also outperformed him consistently, so yes they deserve more recognition.
I like buying ETF from Vanguard VOO. It has done well for me.
You cannot go wrong with a well diversified Vanguard account
Spy, Voo, Qqq
16:30 This always annoys me. If you're going to argue for DCA, at least give the returns of a DCA strategy rather than a one-off investment return.
I think he means that you show up to constantly keep putting money in......
For instance you might do a lump of a few K you saved up in the beginning and fill it up monthly with some hundreds.
Since savings accounts don't really have interest rates... its better to just put that money to use.
I don't arue for DCA here, but I also see a point where you might feel a bit scared about investing so that is a good reason to do it.. and get used to putting up montly investments.
You should buy when the market is high, medium, low and everywhere in-between.
Correct.
I disagree. Let's say I want to buy an ETF like VOO, but I believe the S&P500 will average negative values the next year? Why should I risk losing a percentage of my money in the first year if I can just wait it out?
@@nonamed56 that's the worst idea you can do. Trying to time the market is a very bad strategy.
If you are trying to get VOO, set up a recurring investment each month over let's say this year, if the market is going down, you are buying it cheaper and cheaper, if the market rebounds next year, you'll have great gains. Because you have essentially did a strategy called dollar-cost averaging.
Take it from me, while you are waiting to find the right time to enter the market, that time might never come, or might come 5 years from now, who knows.
@@nonamed56 Yea u can just wait for it. Let use know the date because we all would love to know when to go all in.
@@Alumnikiid lol
Everyone: “time is money”
Also everyone: “I don’t have time!”
Tôi đã xem toàn bộ video này và thực sự rất thích nó. Cảm ơn bạn đã chia sẻ những thông tin quý báu về cách đầu tư và những lời khuyên từ Jack Bogle, người đã thúc đẩy phong trào đầu tư passively thông qua các quỹ chỉ số với chi phí thấp.
Bài học quan trọng mà tôi rút ra từ video này là sự quan trọng của việc tiếp tục đầu tư dù thị trường có đang ở mức cao kỷ lục hay không. Thời gian là người bạn đồng hành của các nhà đầu tư passively, và việc duy trì sự đầu tư theo thời gian dài có thể tạo ra lợi nhuận ấn tượng.
Tôi cảm ơn bạn đã chia sẻ video này và hy vọng bạn sẽ tiếp tục sản xuất nhiều nội dung bổ ích khác trong tương lai. Cảm ơn bạn rất nhiều vì đã mang lại kiến thức giá trị này cho cộng đồng đầu tư.
What I feel like people forget, that might be good to clarify in future videos when you show the historical up and downs... is that you're buying more that entire time, so while it makes those dips painful, it also means the run ups are that much more powerful as well. I think people see the up and down across a horizontal axis and they think "what progress did you really make?" not realizing you own another piece at tons of segments in-between, not buying all in at once and then riding it out forever...
Yeah 100% agree. you might lose 30% on the way down but if you buy more on the down trend the approx 10% uptrend can mean money back and profit at 11% or so.
Looking at this video on June 2022 is amazing! I am in my 50's and just started investing in stocks, ETFs, etc. At least, I will teach my 16 years old doughter.
Great video by the way and in around 2004 I had a chance to meet Jack. Great man. All my investments are in Vanguard .
I know that this might sound too clever. Why not buy the index fund when the index is below its fair value i.e. 13 P/E or 4% dividend as Jack Bogle said here. When the index is above 13 P/E or 4% dividend then put the amount of money you would put in every month into a separate cash account. Then invest twice as much each month when the fund drops below 13 P/E or 4% dividend until the cash account is used up. Take half the money from your bank account and the other half from your cash account. Keep doing this. I would have thought that you would make more money. You have to stick to the discipline of course. If that is too hard then do just what this video says.
Simple answer. Yes. Keep putting money in as usual. Stop trying to time the market.
It would be nice to have some money to invest long term in index funds. Jack Bogle’s advice makes so much sense.
Jack Bogle... a legend and a saint.
And that's just the index return over the 23 years after Jack Bogle's speech.Which is impressive enough.It doesn't take into account the dividends that would have accumulated over the years that when reinvested would have produced a far higher total return.Even with a low yielding index like the S&P, compounded dividends really accelerate the returns.
Thank you for the video. I made some errors in my lifetime and I have emphasized these errors to my kids. My only hope is they will learn from my mistakes.
Every parents motto.
Watching this in September of 2021 and we are still hitting all time highs...money in before the crash is still better than no money invested ever
When people say that the stock market is expensive they need to contextualize it with alternative types of investment, are stocks expensive compared to real estate? are stocks expensive compared to minimal fixed-term deposits interest? are stocks expensive compared to minimal bond returns? are stocks expensive compared to 1 BTC > 50k USD? are stocks expensive compared to cash with >40% M1 created during the last year? we are seeing the results of expansionary monetary policy. it's not like people think the stock market is cheap, is just that they don't have anything better to do with their money.
This is very sage advice from one of the greatest investors of all time. I'll keep this in mind the rest of my investing journey.
The market can go sideways and down from really long periods of time.
There have been several times in the past 150 years where it to 10 to 20 years for market to regain previous highs.
Also Japan had a lost decade in the 90s after Huge QE and arguably still hasn't really recovered.
Having said that I still think this Bull Run has a good set of legs in it good for a couple more years - so BUY BUY BUY!
Japan is an interesting situation/comparison.
This is a great video. The cherry on top would have been the comparison of the current purchasing power of the 10K invested in 1997 vs those same 10K left in a safe (that is, not generating returns and being left subject to inflation).
Edit: Did the calculation myself. To have the same purchasing power of those 1997 10K in 2021 you would need 16.7K. But since you didn't invest them, they are still 10K, which means you are now 6.7K short (that is, you lost 67% of your capital), whereas you'd be over 100% richer if you did enter the market back then. This is of course a worst case scenario. If instead of leaving the money in a safe you left it in a bank account in a certificate of deposit you might still be a little better off. Not much, though.
Whole heartedly agree with Bogle, Buffett and this video. With one addition to the philosophy...particularly when your pot of money has grown into a tidy sum, and you’re getting ever closer to retirement. Pay attention to the 200 day moving average. History has shown that if you sell out of equities when the index falls below the 200 day and buy back in when it rises back above again, you will have preserved more of your wealth. You limit yourself to a 14 or 15% hit rather than a 20-30+ % hit.
This strictly applies to your existing pool of money. I am still a buyer all the way down picking up ever cheaper shares along the way. Once the 200 day MA is hit going up, go all in again with your positions. This strategy has worked all the way back to the great depression up to and including the big COVID sell off last March. This advice is for those trading in an IRA or work 401k type plan where there are no tax implications. You would likely not want to do this in a regular brokerage account as the capital gains might kill you.
Jack Bogle has to have the most fitting voice for that speech. Calm but with certainty and authority.
I have seen people lose thousands on their work 401k in the past when the market crashed. I am almost at retirement age and switched my 401k to a more less risky option as this bubble may come crashing down and i do not have the time(age wise) to rebuild it up. I will play the market on the side and keep my hard earned 401k money .
Very smart. The market will crash sometime in the next 3 years. Happy to see people making smart decisions. Enjoy your retirement
I am in the same "boat". 7 years away from retirement, so I cash out daily to protect from any overnight losses.
Provided that you picked decent stocks the only time you actually lose money is when you take it out.
@@METALADIX Not exactly true. An ETF that has a yearly average of 5.8% could have a negative year in there. If someone pulls out their money before that negative year (let's say immediately before), then how are they losing money?
the Dead have always the best yields :D. The catch is obvious, they are dead. We can go Long for 3 years but not for 50 :)
Where is the link to the original video?
I started stacking to SAVE wealth. I've always been the type of person to spend my entire paycheck. I hate having money just sit in the bank. I am under pressure to grow my reserve of $950k. before I turn 60, I would appreciate any advice on potential investments.
Currently, my primary worry is how to increase revenue during periods of quantitative easing. I cannot afford to witness my savings dwindle away.
@@viewfromthehighchairr How do I Meet this Lady?
@@viewfromthehighchairr Thanks for the info, i found her website and sent a message hopefully she replies soon.
here we go...
thanks mate, great timing for this :)
what actually makes me worry is not the market fuss but the australian-chinese relations because is already starting to effect real estate and mining. If you could make a video about it, it would be awesome.
Man I really like your channel, I will stay tuned for sure.
This was a very good video!
Don’t just do something! Stand there! Jack bogle. Thanks jack! My first mil thanks to you! Great video btw. I see when your video was made. Market went up quite a bit then rates raised, now back up again. I blew up your chart. Thanks
Wow, this is literally the specific question I’ve been asking myself this week. What great timing!
Keep asking the question because this video does not answer it with any satisfaction. He doesn't even mention the many warnings that Jack outlined in the 90s. It's simple advice, from an inexperienced investor, who ignores all the counterpoints. Keep researching
So did I hahaha I wasn't sure about buying some ETF's that track the S&P 500 knowing that it's reaching all time highs
Short answer: Yes Long answer: Yes
Longer answer: Yeeeessssss
EV stocks and cryptos have been leading the race for months now. But most people pay more attention to the shiniest positions on the graph to the cost of proper diversification, making investing look a lot more difficult. Having monitored my portfolio performance smashing a jaw dropping $280,000 from the last 2 quarters, I have learned why experienced traders make enormous returns from the seemingly unknown markets.
Hey bud, I find myself in a fix right now and I need proper advise. I have a lump sum of around $400k, an inheritance sitting in a savings account right now doing absolutely nothing at all. I wanna get something started with it but I need guidance on where and how. You seem to be doing excellent for yourself. I could use some help here.
@@leonardn9621 Algorithmic trading...I copy trades from Monica Sullivan Javorcic, a government regulated broker in the US.
@@robertdobbins1782 Do you copy the trades manually or you just give her your money? And what does Monica Javorcic charge for her services?
@@leonardn9621 I don't give my money to anybody. My account only mirrors her trades in real time. That's the ideal. The lady I just recommended is a renowned broker and knows what the heck she's doing. Check her out and get in touch if you'd need help.
@@robertdobbins1782 Just found her official website so I'll drop a mail right away. Thank you
Great and timely video. Your return on 10k invested in 1997 is incorrect, it is actually more than double 40k, it is 87,535 today, IN VFINX, VANGUARD INDEX 500.
Yes buy, because you can always dollar cost average when price drops.
Absolutely if you are in it for the long haul! As no one knows when the market will go up or down, the best strategy is to keep buying index funds.
I bet part of it is because everybody is getting into investing now. So there's just a lot more people plugging money into the stock market regularly. And that's probably partly what's causing the stock market to be at an all-time high
No, they don't have enough to move anything. It has everything to do with the FED quantitative easing which they obviously can't do forever hence interest rates up to 1.35%
everybody is getting into investing now.
Everybody? Gallup finds 55% of Americans reporting that they own stock
@@DavidEVogel ok smart ass. Sorry I forgot to consult with you
3 years later and we are crossing those all time highs again. We had to get through the 2022 dip first.
Fantastic video as always! Market is certainly going insane currently, given we are talking about passive investing purchasing ETFs now is fine as the key is consistency.
Should I sell out of my vanguard etf’s I got 5 months ago. Sell high? And buy back when the market corrects?
No. Just keep investing whatever you are comfortable with at regular intervals.....Dollar/Pound Cost Averaging
Also you'll pay short term capitol gains tax which is much higher than holding long term
Love Jack. He’s under appreciated by the average investor.
Jack Bogle was a very gifted speaker.
Time in Market > Market Timing
Yeah that ensures that you lose big when you remain in the market with your $80 Citigroup stock in Jan 2018 and now $60
@@Longtack55 Sure I guess, if you're foolish enough to buy individual stocks
@@Thurgor_Supreme Ha ha ha! I'm sorry for you mate. In the last year I had an 11-bagger and several 3-baggers, and ended up 100% in 12 months.
I already own shares of PALANTIR, TSLA, NVDA and APPL as well. Sure, I don't mind having these equities sit around for a while, but I'd also like to appreciate short-term opportunities that could fetch $200,000 or less.
I like that you use basic valuation metrics. Yes jack bogle helped bring low cost funds/etfs to the masses slashed costs and made investing non complicated. Etfs have outperformed 95% of fund managers in the last 15 years. The market is crazy expensive I will wait for larger retracements and bulk buy in at discounts.
These videos are an open invitation to debate and investigate. There's no need to take everything that a person in a video is saying for granted. Always be diligent; stay curious; do your own research; do your homework.
Man, such a great channel on TH-cam you have.
Hats off!
Great advice from a great man!
Hey mate, Thanks for bringing up Jack Bogle!, The man who made my financial perception right on track!. Btw. How can I cut the pie across VGS & VAS. I sit at 60/40 atm. Would love your thoughts on it.
Yes my new low is wherever "high" I bought it at. Better late than never. If it dips I buy more
Nice! Jack is one of the most important investors all time. Could you make similar S&P’ calculation with aggregate inflation?
First time I’ve heard “it’s better than a poke in the eye”, that absolutely cracked me up. Great advice by the way!
I always thought that was a Black Country saying🤣 heard it all the time growing up. Usually 'better than a poke in the eye with a sharp stick' 🤣
Dick Van Dyke uses it in Mary Poppins when describing his chalk drawing
Good video and great explanation of Jack’s thoughts. But your example in the end is not convincing. $10000 in 1997 grows only to $40000......Are we missing something....what about dividend reinvesting and power of compound interest?
I don't think the ASX200 is that over priced.
Especially compared to say the s&p500 and NZX50 those are crazy, pretty much tripled in the last 10 years
Was looking a that today. Best tip
Really adore this guy. Watching his videos in the gym and whatever I go just to get the most of TH-cam :) Thank you!
Thanks. This type of content helps keep me on track for sure.
Thank you! You explained so well. I feel convinced now to ‘stay the course’ -which I set since August 2020 and has given me a 25% revenu. Your contribution is much more interesting than all the predicted financial crisis by the ‘experts’ here on TH-cam. But staying the course should not keep us from beeing flexible. Keep learning and open to change at all times.
Time in the market beats everything! Thanks for sharing!
Does anyone know the name of his book that jack bogle mentioned in his interview?
Thanks for the review
+1>>8>>5>>8>>30>>6>>3>>0>>6>>
t>t>a>p>p>>
If you invested $100 into the S&P 500 back in 1900...
It would be worth $8.6 million today
If you had saved $100 in a savings account in 1900...
it would be worth $2 today
Do you see the power 💪 of investing now?
I also can draft the chart and do the promote too. You look at the single piece report chart to do the spend 1000 dollars
Solid logic, though if we are still following our fundamental strategies that likely does mean in markets like we are seeing now, the number of places to put that money should be fewer. Yes you want to keep investing in 2008, but if you do your proper research, maybe the housing market wasn't the place to put it :p Which makes me think investing your money into the average market now is fine, but I would personally avoid all the incredibly inflated new tech stocks. Put your money somewhere, but not just anywhere :)
And not everywhere.
Wrinkly brain
Market crash, bear market , all time high bla blah blah ignore all that bullshit. Find a good company, with a reasonable dividend payout , buy and hold.
This is great advice if you are under approximately 35 yr. The reason I say that is because you hear so much about once you are in your 60’s you are less likely to be completely(meaning 100%) in the market. So sure passive long-term investing is great, but really works absolute best if you start young.
8:43 Abe Lincoln blinks in agreement
I am amazed why this is not the top liked comment
And it is super creepy... remind me of the Predator
Spooki
@ This. This is gold.
Great video! Your description is great. Warren buffet has a great video on this regarding his first stock purchase, which talks about this.