I guess for most equity investors, stress [like all-at-once stressor moments, distraction, sleep in peace,,,] is like an “occupational hazard”, a fact of life.
I practice mainly two forms of eq-investing AA) SP500_ETF, BB) recreational MOETF. All other forms of eq-investing are unfamiliar to me, and by default too risky in terms of “wildfire getting out of control” .. such as those 3episodes@ non-recreational trading. It’s worthwhile reviewing stressful investing experiences.
Note the key benefits of AA and BB are unavailable in “my” other asset classes like FXO, leveraged FX, gold, bond mufu, Singapore ETF
== AA) mindless investing .. SP500_ETF (not other indices, not mufu) is one low-stress, buy-n-forget form of investing. What about $200k in it? Should be fine. Buy-n-forget SP500_ETF relies on the index committee as stock pickers. Other ETFs, like sector ETF or other countries’ ETF are usually less successful than SP500_ETF. (Note buy-n-forget a single stock doesn’t involve exit-timing. Can rarely beat SP500_ETF.)
How about “balanced” mufu? It is supposed to buy “stability” at the cost of return but in my experience it doesn’t reduce stress cf SP500_ETF. Actually I always maintain my own bond ptf + speculative ptf + …. I can rebalance them, something I can’t do with a balanced mutu. Also the expRatio is not worthwhile.
== BB) recreational MOETF .. a classic positive stress comparable to other analytical and active-learning pastimes, in tech, magazine-xx, healthy food preparation,,
However, as I commit more funds into MOETF, this recreation can get out of control. Therefore it requires a robust firewall.
The positive stress is felt in a few specific stressor contexts listed in Q9.
- Heavy allocation to growth ptf .. leads to net_negative effect on my overall stress profile, net_negative after considering firewall, buffer build-up.
- Overwhelming allocation to dividend stocks .. has a 50/50 chance to net positive or net_negative stress, depending on the context
— destressor: firewall .. is designed for 1) stress protection, 2) portfolio protection.
Q: what frequency of ptf review is the max before it would lead to net_negative stress? Give a single number please
A: [3->6] a quarter
— destressor: steady DYOC .. (from my income portfolio) supposed to /defray/ a lot of annual expenses, reducing cash flow stress, but I have low cashflow stress in the first place.
Substantial DYOC should reduce the impact of a down turn, to be verified ..
— destressor: price buffer build-up has limited efficacy in stress reduction.
— destressor: diversification … meaningful diversification is not easy. Any evidence of that within a stock portfolio? I have not seen any.
=====
— Q: your notion of a wise investor? Beware not all “experienced” investors are successful in stress-management.
- stress reduction .. keep the growth portfolio small (relative to…). This is my idea of a wise investor.
- stress prevention
- stress protection .. is hard to achieve, even for experienced investors
- portfolio protection … defensive ptf? I don’t think this is a standard strategy among wise investors. Many wise investors don’t mind high volatility in a small ptf.
- SP500_ETF .. (rather than mufu) is probably popular among those “wise” investors.
— Q9: (personal experience ) when I came under _certain_ types of stressors (but NOT other stressors), I would increase my recreational MOETF hour-allocation and dollar amount allocation. A paradox!
There are too many types of stressors even in a single person’s life. Let’s first focus on those stressors “friendly to” MOETF:
- the stressor of plateauing growth: 江河日下,自强不息, midlife crisis #timetable@self-growth? Yes. MOETF represents a new frontier of self-growth[learning]. MOETF increases my sense of relative superiority. Recreational MOETF generates positive stress.
- OC-effective? T_semiKai3mo2? FOLB? presumably effective : stress-reduction by recreational MOETF
- BMI stagnation? workout frequency?
- boy’s academic motivation?
- spouse quarrels? probably a positive diversion