Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Indexed technology investments?
Old 01-19-2017, 09:50 AM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 7,863
Indexed technology investments?

Hi,

My son wants to invest his Roth IRA contribution this year in "technology". I'm encouraging him to get a diversified investment such as a mutual fund or ETF. I also like index/passive investing.

I looked around and found VGT (Vanguard IT Index Fund ETF). Any other suggestions for him to consider?
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 01-19-2017, 10:04 AM   #2
Recycles dryer sheets
 
Join Date: Jan 2014
Posts: 87
Comparable technology EFT at Fidelity is FTEC.
greydog17 is offline   Reply With Quote
Old 01-19-2017, 10:32 AM   #3
Thinks s/he gets paid by the post
RockyMtn's Avatar
 
Join Date: Jul 2009
Location: North Scottsdale
Posts: 1,545
xlk!
__________________
FIRE'D in July 2009 at 51...Never look back!
RockyMtn is offline   Reply With Quote
Old 01-19-2017, 10:49 AM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 10,252
What investments do all his friends use?
LOL! is offline   Reply With Quote
Old 01-19-2017, 11:31 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 7,863
Quote:
Originally Posted by LOL! View Post
What investments do all his friends use?
He's 16. All of his friends, as far as I know, don't invest in Roth IRAs.
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Old 01-19-2017, 11:58 AM   #6
Thinks s/he gets paid by the post
exnavynuke's Avatar
 
Join Date: Sep 2016
Location: Acworth
Posts: 1,214
Knowing nothing else about his finances, I'd say this is a good time to explain to him the downsides of investing in only slivers of the economy and how damaging that can be to one's portfolio; for instance, show him how a "technology portfolio" would have fared from 2001-2003 and then show him the relative performance of a more balanced portfolio.
exnavynuke is offline   Reply With Quote
Old 01-19-2017, 12:04 PM   #7
Thinks s/he gets paid by the post
 
Join Date: Aug 2013
Location: North
Posts: 4,023
AAPL. Although I would set the limit to around $99... that'll teach him two things...
1. Buy low
2. Patience
__________________
Time > $$$ ~ 100% equities ~ FIRE @2031
kgtest is offline   Reply With Quote
Old 01-19-2017, 12:07 PM   #8
Thinks s/he gets paid by the post
mpeirce's Avatar
 
Join Date: Feb 2012
Location: Northern Ohio
Posts: 3,181
I'd advise him to invest *most* of his assets in something like the total market index, but to put some into individual stocks or targeted funds.

Honestly, there is no better way to learn about the need for diversification than losing some* money on individual stocks. Loosing a few dollars now is a much better way to learn about the market than book learning or stories from parents.
mpeirce is offline   Reply With Quote
Old 01-19-2017, 01:15 PM   #9
Thinks s/he gets paid by the post
DrRoy's Avatar
 
Join Date: Dec 2015
Location: Michigan
Posts: 4,942
Quote:
I'd advise him to invest *most* of his assets in something like the total market index, but to put some into individual stocks or targeted funds.

Honestly, there is no better way to learn about the need for diversification than losing some* money on individual stocks. Loosing a few dollars now is a much better way to learn about the market than book learning or stories from parents.
+1 How about 80% in a total market ETF, and then any of the above tech ETF's will do for the rest.
__________________
"The mountains are calling, and I must go." John Muir
DrRoy is online now   Reply With Quote
Old 01-19-2017, 01:37 PM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 7,863
Thanks all.

He is now 20% NKE, 31% FTEC, and 49% SWTSX.

We do talk about diversification, costs, starting early, not churning, and all of that stuff. I know tech crashed in 2001-2003, but my belief is that long term it will do about as well as the broader market, so I'm not concerned about his investment from that point of view.
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Old 01-19-2017, 01:38 PM   #11
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Flyover country
Posts: 25,155
Quote:
Originally Posted by kgtest View Post
AAPL. Although I would set the limit to around $99... that'll teach him two things...
1. Buy low
2. Patience
I tend to agree. At least a few shares of AAPL, the rest in an ETF. Although I would set the bar for AAPL at $110. With a P/E right now of less than 15 compared to the S&P 500's 25, I don't think he could go too far wrong long term even at today's price.
braumeister is offline   Reply With Quote
Old 01-19-2017, 02:33 PM   #12
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,650
Given that, as far as I know, all profits from Apple come from one single product, namely the Iphone, I would be very wary.

Remember Nokia? Blackberry?
Totoro is offline   Reply With Quote
Old 01-19-2017, 02:55 PM   #13
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Flyover country
Posts: 25,155
Quote:
Originally Posted by Totoro View Post
as far as I know, all profits from Apple come from one single product, namely the Iphone
About 60%, actually. But that's a legitimate concern. I still believe they are going to come out with new products that will be as game-changing as the iPhone. We'll see.
braumeister is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Financial dinners and Equity Indexed Annuities janeeyre FIRE and Money 20 04-02-2007 08:03 AM
Indexed vs. Active Bond Fund TromboneAl FIRE and Money 10 04-05-2006 06:06 PM
Managed versus Indexed danearnold FIRE and Money 11 01-31-2006 03:37 PM
Vanguard Inflation-Indexed Annuities? Gearhead Jim FIRE and Money 11 12-18-2005 07:51 AM
Equity Indexed Annuities John_Lee FIRE and Money 0 04-07-2005 07:46 AM

» Quick Links

 
All times are GMT -6. The time now is 05:39 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.