π§ Should We Just Index?
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Friends,
Picture someone you care about — a child, a friend, your spouse.
Now imagine this person has found an activity that:
- Quenches their intrinsic curiosity
- Leads to a deeper understanding of the world around them
- Helps them connect with others who have a similar passion
- Is not inherently toxic or unhealthy
- Makes them money
If all of these things were true, would you ever pressure them to give up that activity?
We hope the answer is “of course not!” We want what’s best for those we love.
We bring this up because last week, Stoffel shared his portfolio with the Twitter-verse. He does this every month. He also includes his overall performance.
Over the past five years, he has doubled the S&P 500’s returns. But when compared to the NASDAQ, it’s break-even. That led many to (correctly) claim he could have saved himself a lot of trouble by just buying a NASDAQ index fund.
We don’t disagree with that conclusion. Instead, we’d zero in on the word “trouble.”
If investing is stressful, boring, myopic, or an unhealthy for anyone, we heartily encourage them to simply dollar cost average into index funds. There is, truly, nothing wrong with that.
But if you consider investing to be intellectually fulfilling — and you expand your network, mindset, and wealth along the way — then we think it can be an intrinsically worthwhile pursuit.
That’s the kind of long-term dynamic we’d select for our loved ones — and ourselves — every day of the week.
Wishing you investing success,
– Brian Feroldi, Brian Stoffel, & Brian Withers
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