Investment Opportunities

[Qs Laptop]

I think both people who are still following this thread have probably checked out now. Believe what you like. I assume you have taken very large positions in the funds you mention.

Your data shows that 16% of funds remained in the top quintile over 5 years. That is not an insignificant number. Also, a fund could be in the top quintile only 4 years out of those 5 years and it wouldn't meet this particular criteria, yet it could very likely beat the index in total return over those 5 years. In other words, the "persistence" metric is not all that useful. I would go so far as saying it's selectively biased. The proper criteria is consistently beating the index.

I have about 12% in FBGRX. Also have 5% or so in QQQ. Minor position in FSELX.

 

[Closet_Gamer]

Looks like another "index only" zealot.

Ha. I’m hardly a zealot … tho the math and history make me skeptical of outperformance.

If this discussion was in the Active Investing Forum, I might understand your comment as that forum is explicitly devoted to non-index discussions and has been set up up to avoid thrashing around on index vs not.

This is in the FIRE and Money Forum.

He was looking for places to put money. I was merely making the point that it will be hard to find a superior investment over time than QQQ or another large index. Fair play as far as I’m concerned.

 

[Koolau]

Think whatever you want. The fact is that 5 years ago these funds were beating the index for any 5 year period over the past 20 years, no matter what endpoints you listed. And 6 years ago and 7 years ago and 8 years ago they were beating the index for any 5 year period over the past 20 years, no matter what endpoints you pick. That's one of the reasons I bought them.

Is it unreasonable to assume they will not beat the index in the next 5 years?

Why?

Q makes a good point.
Too much credence is given to the old saying "past performance doesn't predict future results".
It doesn't GUARANTEE future results, true.

But I believe that certain sectors will tend to outperform the S&P 500 on average, over time.

Still, those four Fidelity funds appear to be managed funds, with potential for large Capital Gains Distributions, which is not a good thing in a taxable account.

So I still prefer certain narrow index funds like VGT and MGK...

Go for it. I'm actually happy that they w*rk for you.

 

[Qs Laptop]

I would consider Eli Lilly, LLY. The weight loss drug they make, Zepbound, is just starting to catch on. There are various spinoff treatment applications for it, including sleep apnea, Parkinson's, heart disease, etc. The side benefits of weight loss are many--lowering blood pressure, relieving stress on joints like knees and hips, prevention of diabetes, etc.

[Edited to add: Eli Lilly announces earnings on Thursday.]

Eli Lilly’s profit doubled in the fourth quarter, propelled by its hot-selling diabetes and obesity treatments, and the drugmaker came out with a mostly better-than-expected 2025 forecast.

Sales of Lilly’s top-selling product, the diabetes treatment Mounjaro, jumped 60% to $3.53 billion in the final quarter of 2024 while its obesity treatment counterpart Zepbound brought in $1.9 billion.

For 2024, Mounjaro sales more than doubled to $11.54 billion, while Zepbound notched sales of $4.9 billion in its first full year on the market.

Analysts expect more than $18 billion in sales from Mounjaro this year and over $10 billion from Zepbound, which was recently approved in the United States as a treatment for some forms of sleep apnea.

Diabetes and obesity drugs fuel Eli Lilly profit in the final quarter of 2024

 

[OldShooter]

Eli Lilly’s profit d ...

From Rick Ferri's "All About Asset Allocation" : "There is a classic saying on Wall Street, 'What everybody already knows is not worth knowing.' "

 

[Koolau]

From Rick Ferri's "All About Asset Allocation" : "There is a classic saying on Wall Street, 'What everybody already knows is not worth knowing.' "

Yeah, I looked at LLY chart over the past year. It's been significantly higher than it is now. So I suppose buyers of the stock thought the company was going to do well. Now they know how well it's doing and aren't as motivated to buy. What is the other saying? "Buy on rumor, sell on fact."

 

[Montecfo]

LLY has been a fabulous holding. I bought it because it was a drug company with a solid pipeline for a conservative part of my portfolio. Even though I am pulling all my spending cash from that account, account value never seems to decline.

AVGO has been similar. I bought it as a dividend play with some growth. Growth at a reasonable price GARP). It has outperformed my wildest expectations.

I would not buy either here although both had great earnings reports.

I am looking to add beaten up growth if the market continues to selloff and fear takes hold .

 

[Flieger]

LLY has been a fabulous holding. I bought it because it was a drug company with a solid pipeline for a conservative part of my portfolio. Even though I am pulling all my spending cash from that account, account value never seems to decline.

AVGO has been similar. I bought it as a dividend play with some growth. Growth at a reasonable price GARP). It has outperformed my wildest expectations.

I would not buy either here although both had great earnings reports.

I am looking to add beaten up growth if the market continues to selloff and fear takes hold .

For Growth I am adding to indexes. I have been adding here this week and am closing in on my allocation percentage for that part of my Portfolio!

Flieger

 

[Koolau]

For Growth I am adding to indexes. I have been adding here this week and am closing in on my allocation percentage for that part of my Portfolio!

Flieger

Yeah, there's at least one advantage of a market pull-back. You can add a lot more shares to your port. for the same amount of dollars.

I too try to w*rk my rebalancing by this tactic when it's available.

 

[pb4uski]

Yeah, this and Toyota Motor similar "bonds" have been discussed here in the past. Might want to do a search for them to get some feedback on them, if anyone is interested.

In the past I have owned Toyota Income Driver Notes, GM RightNotes, Dominion Energy Reliable Income notes, and looked at the U-Haul product. The first 3 function similar to a money market fund but the underlying credit are essentially commercial paper issued by the companies. I think they are fine but I was bothered by a proliferation of accounts between those and various bank and credit union CD accounts that I had so I consolidated things at Schwab for easier management.

 

[pb4uski]

Not sure of your point in this post?

Flieger

Since when did posts on this forum have to make a point?

 

[Koolau]

Since when did posts on this forum have to make a point?

 

[dobig]

I had no growth in our portfolio so bought a good amount of SCHG at a 10% discount. Maybe it goes down another 10% but I can't count how many times I've missed buying opportunities over the years waiting for better pricing. First time we went to a FA was '22 when S&P had dipped below 3,600. Young guy. Knew his stuff. Advised waiting until it dipped below 2,800.

Also upped our SCHD and DGRO allocations by about 10% each. Core brokerage holdings for retirement income. Our international, VYMI and SCHY, have finally come to life which isn't all that important as I'm in for the big fat divvy they pay.

 

[Al18]

The SP500 low in 2022 was 3577 on October 11 according to S&P 500 Historical Data (SPX) - Investing.com

It never got near 2800

 

[dobig]

The SP500 low in 2022 was 3577 on October 11 according to S&P 500 Historical Data (SPX) - Investing.com

It never got near 2800

I know. FA thought it was going at least that low. We took his advice and waited. 8 or so months later we invested when S&P was around 4,500.

Obviously never spoke with that FA again.

 

[Al18]

ouch. Can you try to recover some of that money, based on his poor advice?

 

[Koolau]

ouch. Can you try to recover some of that money, based on his poor advice?

A couple of my direct reports retired early because a broker promised them that they could take 8% of their portfolio value every year as he wrote covered calls for them. It didn't w*rk and they had to go find menial j*bs to survive. They DID actually receive some kind of judgment against the broker. I was quite surprised. It wasn't enough to make them whole but it helped.

I wouldn't count on it.

 

[dobig]

ouch. Can you try to recover some of that money, based on his poor advice?

We're in a good position regardless of what happened. Don't want to ruin our happy lives dealing with lawyers and courts.

 

[Koolau]

We're in a good position regardless of what happened. Don't want to ruin our happy lives dealing with lawyers and courts.

That's a good attitude. I felt kinda sorry for my former empl*yee who was really hurt by his broker. Imagine being 60 and your Port has taken a huge hit and you have to find grunt w*rk to survive. I think that would motivate me to sue a broker. But if my remaining Port was still fat, I'd just let it go. Law suits are more stressful than w*rking!