The Stocks Redpill

Why do idiots on thus board seriously think they can do better than the market on trading?

>>1851377
$18000* (1.07^40 1.07^39 +...1.07) ~ $4M

The average investor is putting away money for retirement not to get rich.

>>1851377
7% average return is like from a s&p fund (average investor = retirement fund).

There is no such thing as a sure bet in trading (unless you're HSPTs where you just have illegal data feeds).
Its all about your equity curve upwards

>>1851401
because some can (its not that hard but people on here are autistic)

>>1851406
it's 269k retard

>>1851437
An American, I guarentee.

>>1851437
What kind of retard only contributes to his 401K for one year of their career?

>>1851377

>sure bet

no such thing

>doesn't know average is a measure of central probability
>central

You're a fucking idiot for not arguing with the skew of the distribution.

>>1851494

is this what coping looks like?

warren buffett makes an annual return of 15%. that means he makes $15k per $100k.

do you have $100k invested? are you better than warren buffett?

>>1851526
If the skew is tailed to the right then it would support your argument.

You don't deserve to be in stocks if you don't know how statistical moments work.

>start investing a year a go with 10k
>invest with knowledge I pull out of my ass, total noob sometimes I feel things are way over my head but I do my homework and keep going
>invest mostly on volatile penny stocks but leave worthless penny stock that's too speculative for me, try to always gamble with business that won't literally go to 0.00
>also invest in a few blue chips from time to time and even memestocks, blue chips are the only long term investment tho
>started with 10k now less than a year after I've got 22k
So you guy are either full of shit total grandpas or immthr fucking wolf of Wall Street maybe I should send my resume to Goldman if what's being said in this thread is real.

>>1851377
>what's the point?
free m0ney

even if it was .00007% people would do it because free money

are you retarded?

don't answer, it's rhetorical

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> Hillary Clinton made a $98,540 profit from a $1,000 initial investment in less than one year trading commodity futures. (http://archive.is/FT5dO)

If you can't even beat Hillary with your trades you should just end it desu

>>1851553
How can she open an account and only invest 1k?

>>1851377
>getting 7% p.a. RoC by doing abso-fucking-lutely nothing is somehow bad

Oh my...

>>1851401
Because they read books--if even that--written by people who make a living off being paid by other people to produce sub-par returns on capital as opposed to having read something as basic as intro to economics, stop being a retard and just buy fucking index stocks. Good that these guys exist though. Non-index companies need to sell their stocks too occasionally and there are always enough suckers to buy them.

>>1851541
>look at me I made a profit in a bull market of a single year!
let's see where you are a decade from now

>>1851377
Compounding at 7% for the next 20 years:
2017 $100,000
2018 $107,000
2019 $114,490
2020 $122,504
2021 $131,080
2022 $140,255
2023 $150,073
2024 $160,578
2025 $171,819
2026 $183,846
2027 $196,715
2028 $210,485
2029 $225,219
2030 $240,985
2031 $257,853
2032 $275,903
2033 $295,216
2034 $315,882
2035 $337,993
2036 $361,653
2037 $386,968

>>1851377
Honestly your average person isn't massively bright and probably doesn't posses the skills or temperament to do well at active trading.

It's like any other skill, most people are shit at programming, or baseball, or Starcraft.

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>>1851719
There is a difference between "investing" and "speculating"
Investing is about compound returns. You're looking to spread risk as widely as possible with a healthy RoC.
Speculating is closer to gambling in that you take a bigger risk to try and make a great reward.
To answer your answer directly as why people invest looking for 7% return, it's about risk appetite. When you're young you might be comfortable gambling; but as you approach retirement, for example, you want a steady income without risking your capital base.

>>1851401
You sound like an idiot when you use "the market" in that context.
There are thousands of markets, each with their own expected return, volatility, risk, total market cap, and skill factor.
If there were a market that could double your investment in a year with little risk, but the capitalization was only $250,000 and all price discovery was carried out in Mongolian, it would be extremely lucrative for certain microscopic retail investors but not worth the time for institutions.

>>1851730
Importantly, regardless of whether you are young or old, you will statistically make more money with long term investments than with speculation.

oh my god i wish i had worded the op more carefully. to clarify, i didnt mean to ask, "why bother investing if you'll only get 7%", I meant, "why bother spending all day speculating/daytrading when you're statistically likely to only make between 7%-15%"

a few good answers here though, appreciated.

>>1851738
Statistically the average person will make more with long term investments than speculation, it's a bell curve with Bill who works in HR in the middle, and people like that Japanese turbo-autist daytrader on the edges.

>>1851741
Not an average person, a professional fund manager. That normal people just trying out trading make rookie mistakes like spending more on order fees than they get in RoC and make other bad decisions is not surprising. A fund manager on the other hand does this as a profession and is supported by a team and has the best tools. The only problem is that there are enough of them by now for none of that to matter and you get a the random walk theory. This isn't even a matter of argument, we have enough studies on the matter.

>>1851739
In robinhood general, there are people who make 20% gains in a day....And people who lose 50% in a day. Such is the life of Robinhood general threads.

If you are 30 years old with $100,000, compound it at 7% for 35 years and it becomes $1m
This means at 65 years old you have a $1m lump sum and you can comfortably draw an annuity of 3.25% (your-age divided by 20)
In this example, your annuity would be $35,000 and would increase in line with inflation.(Bear in mind you haven't paid in anything for 35 years either. If you paid in every month your pension is fucking gangbusters)

2017 $100,000
2018 $107,000
2019 $114,490
2020 $122,504
2021 $131,080
2022 $140,255
2023 $150,073
2024 $160,578
2025 $171,819
2026 $183,846
2027 $196,715
2028 $210,485
2029 $225,219
2030 $240,985
2031 $257,853
2032 $275,903
2033 $295,216
2034 $315,882
2035 $337,993
2036 $361,653
2037 $386,968
2038 $414,056
2039 $443,040
2040 $474,053
2041 $507,237
2042 $542,743
2043 $580,735
2044 $621,387
2045 $664,884
2046 $711,426
2047 $761,226
2048 $814,511
2049 $871,527
2050 $932,534
2051 $997,811
2052 $1,067,658

dont invest, just trade

>>1851824
>If you paid in every month
you could get to $1m in 2017 dollars by ~45 and retire immediately
you don't even need to own a home or anything, your income from your portfolio could easily cover a mortgage/rent

>>1851824
You have to remember inflation.

£1m in todays money would be about £371,750 in 1987.

To have the equivalent of £1m in 1987 you would need to save £2.7m.

If you assume 3% average inflation over the next 30 years you would need £2,427,262 to have the same spending power as £1m

>>1852283
7% is average return after inflation

i don't understand what people are confused about, you check a stock over a 30 day period, see it's low and high prices, buy near the low sell near the high, and take your profit when it's above 5%.

diversify when you have a million dollars, until then you're playing a shell game with monopoly money, consider it lost.

look at SNAP for example.
>27.09 top
>21.44 bottom

>22.07 current

Obviously it will go down to 15 and climb up above 30. Current price is closer to 15 than 30, no brainer buy.

>>1852296
Wrong.

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>>1852301
>Obviously it will go down to 15 and climb up above 30

Thanks for proving why the majority of day-traders lose money, they're idiots like you.

>>1852296

3% - 4% after inflation

hence the 4% drawdown "rule"

>>1852316
no that is correct so fuck off

>>1852328
no that is not what the swr is based on
its because the 7% figure is the mode average

>>1852337
mean*

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>>1852329
NO You

>>1852319
this is not a day trade, it's a trade over 30-90 days.

day traders look at other things, news and volume mostly. they lose money because it's a biased coinflip and they overleverage their positions.

>>1851579
>What is Robinhood

>>1851377

Uh in 20 years you can bring $500k to nearly $2million.

>>1852408
I think that's his point, it's a shit return.

Investing in stockmarkets returns doesn't come from rent, but from stock's price.

Bussinesses doesn't improve their profits, it's the opposite usually thanks to a little of capitalism. Yet, prices go higher, why?

Monetary policies

>>1852348
scalping is the true and only master race