Re: Investing money?

**Hambergler** · 05-16-2008, 01:22 AM

Originally Posted by CingularDuality

Expense ratios matter very little in the long term. It's much, much more important to find a good fund and stick with it.

I strongly disagree. Here is Fidelity Latin America Fund vs Fidelity 500 Index Fund with equal rate of return over 20 years.

Anyone or broker that says they can get more then 8%-9% in a mutual fund over 20 years is dreaming IMO.

The biggest and most propped up funds in the world are index funds. And there is a reason. They are the benchmark.

http://www.fool.com/school/mutualfunds/costs/ratios.htm

**CingularDuality** · 05-16-2008, 04:42 AM

Originally Posted by Hambergler

Anyone or broker that says they can get more then 8%-9% in a mutual fund over 20 years is dreaming IMO.

You're high on drugs. There are funds that have done better than 16% over 20 years, and others that have done better than 10% over 50 years! There are funds that earned 50% over the last 5 years! Pick one of those funds and a 2% expense ratio really doesn't matter.

**Hambergler** · 05-16-2008, 09:42 AM

Originally Posted by CingularDuality

You're high on drugs. There are funds that have done better than 16% over 20 years, and others that have done better than 10% over 50 years! There are funds that earned 50% over the last 5 years! Pick one of those funds and a 2% expense ratio really doesn't matter.

OK,then show me what funds you are in now. Then tell me what funds you would have realistically put your money into in 1980.

There are great performing stocks as well, but how many of us are getting rich off them. The average person didn't but M$ in the 80s.

Chasing a 50% mutual fund is not what I would call wise investing.

**Tempus** · 05-16-2008, 10:02 AM

Expense ratios are meaningless, assuming you have a fund that outperforms an index fund. The only thing that matters in the end is the total return. Who cares if the expense ratio is 1% or 15%? As long as your return is acceptable, the expense ratio is just a detail.

I've been investing in the Fidelity Contrafund for 17 years now. It way outperforms the SP500, even with it's higher expense ratio.

Also, the Latin America fund, which I also invest in, thoroughly trounces the SP500, despite its 'high' expense ratio.

Yeah, it'd be nice if all funds had low expense ratios. But actively managed funds, particularly that invest in international stocks, necessitate having higher expense ratios. One could argue that you get what you pay for.

**DaBrit** · 05-16-2008, 10:13 AM

If the real estate market wasn't what it is now, I would say find some land. All of the richest people I know made their money in real estate. Some of them have been millionaires, lost it all, and now are worth hundreds of millions of dollars again. Once the market stabilizes, and you don't mind a little bit of risk and have a good nose for property, you could probably leverage yourself into just about anything.

**War.mongeR1** · 05-16-2008, 11:48 AM

Originally Posted by Hambergler

OK,then show me what funds you are in now. Then tell me what funds you would have realistically put your money into in 1980.

There are great performing stocks as well, but how many of us are getting rich off them. The average person didn't but M$ in the 80s.

Chasing a 50% mutual fund is not what I would call wise investing.

True, but it might be OK for the very short term. Back in 2006, my brother made like 37% on an "Emerging Markets" mutual fund. However, I would also be leery of claims of 50%. There are funds deemed aggressive, which is what many recommend us younger folks start with to maximize our overall returns. Then as time goes on, you start placing those funds in more conservative investments. I'm not an expert, but this is what I often hear.

**CingularDuality** · 05-16-2008, 04:11 PM

Originally Posted by Hambergler

OK,then show me what funds you are in now. Then tell me what funds you would have realistically put your money into in 1980.

There are great performing stocks as well, but how many of us are getting rich off them. The average person didn't but M$ in the 80s.

Chasing a 50% mutual fund is not what I would call wise investing.

I'll agree that the 50% mutual fund is a risky one. But you came here and made an absolute statement that was simply incorrect.

Go to Morningstar and search for funds based on their performance over the last ten years. There are plenty of funds with low risk that made over 15%. Look at the low risk Vanguard Precious Metals fund over the last 5 years! 40%, and 22% over the last ten!

Originally Posted by DaBrit

If the real estate market wasn't what it is now, I would say find some land. All of the richest people I know made their money in real estate. Some of them have been millionaires, lost it all, and now are worth hundreds of millions of dollars again. Once the market stabilizes, and you don't mind a little bit of risk and have a good nose for property, you could probably leverage yourself into just about anything.

Real estate will ALWAYS appreciate over the long term. Nobody's making any more of it (well, except in Dubai...).

The problem is how long it will take to appreciate, and whether or not you can afford to let your money sit there while there are other places that you could be earning money.

**Hambergler** · 05-16-2008, 10:15 PM

Originally Posted by Tempus

Expense ratios are meaningless, assuming you have a fund that outperforms an index fund. The only thing that matters in the end is the total return. Who cares if the expense ratio is 1% or 15%? As long as your return is acceptable, the expense ratio is just a detail.

I've been investing in the Fidelity Contrafund for 17 years now. It way outperforms the SP500, even with it's higher expense ratio.

Also, the Latin America fund, which I also invest in, thoroughly trounces the SP500, despite its 'high' expense ratio.

Yeah, it'd be nice if all funds had low expense ratios. But actively managed funds, particularly that invest in international stocks, necessitate having higher expense ratios. One could argue that you get what you pay for.

Contra is a very exceptional fund and so is Latin America, but 90% of managed funds have failed to outperform the index over the last 20 years. That means the chances of me picking a better fund are pretty slim. Perhaps I should listen to Tempus.

http://www.thestreet.com/funds/mutua.../10385337.html

**CingularDuality** · 05-16-2008, 11:34 PM

Originally Posted by Hambergler

Perhaps I should listen to Tempus.

I would. Anyone can start a fund. But pick one with a good manager and you're going to make money.

**Bamboo** · 05-20-2008, 08:54 PM

New post that might help

How to Turn $450 a Month into $1 Million

Helps explain how to invest so you can retire with money. It is common sense stuff.

**Dirtboy** · 05-23-2008, 01:48 AM

Well, I did it.

I took a loan out for $10,000 dollars to buy a piece of lake front property back home in Wisconsin. All in all, I spent about 18 Grand for it and I am sure that I can get a good chunk of change reselling it in a couple of years to some Milwaukee tourist who wants to build a summer home. We will see...

**HockeyTemper** · 05-25-2008, 12:39 AM

Invest in Analog Television. I have a good feeling that they are coming back!

**CingularDuality** · 05-25-2008, 01:07 AM

Originally Posted by Dirtboy

Well, I did it.

I took a loan out for $10,000 dollars to buy a piece of lake front property back home in Wisconsin. All in all, I spent about 18 Grand for it and I am sure that I can get a good chunk of change reselling it in a couple of years to some Milwaukee tourist who wants to build a summer home. We will see...

Man, if you can afford the loan, you can't go wrong with real estate! Good luck!

**Steamers** · 05-25-2008, 01:37 AM

Real estate is your best bet dude

**ScratchMonkey** · 05-25-2008, 03:11 PM

Originally Posted by ThePromQueen

Invest in Analog Television. I have a good feeling that they are coming back!

I remember when nuclear war was still in everyone's mind, and the practical considered keeping a points-based distributor around because EMP would blow out your fancy electronic ignition and render your car a brick.

There was also the tubes-versus-transistors debate, with transistors being cheap but tubes having the quality. Another VHS-versus-Beta situation. Tubes may still make a comeback at the semiconductor scale, though. (For those of you across the pond, tubes are "valves".

)

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