Friends,
Overconfidence is a dangerous drug. Back when I (Stoffel, here) was getting started investing, I didn't realize how lucky I was. My first major purchases were occuring in March 2009 -- the nadir of the market's Great Recession crash.
The overconfidence spilled over when I started writing for The Motley Fool. My first major project was titled: The World's Greatest Retirement Portfolio.
Humble, right?
In it, I called out 10 companies that I was putting my money behind. Since then, two have been bought out (Whole Foods and Activision Blizzard), and four have been mega-winners (Alphabet, Amazon, Apple and Intuitive Surgical).
Recently, I went back to see how that portfolio would have done had I only invested (and stayed invested) in those stocks over the past 12+ years.
Assuming I distributed the cash from each buyout equally at the time they closed, the resulting portfolio returned 537% from December 31, 2014 to today.
Here's why this matters: below, I've attached my ACTUAL results over that time frame, along with the S&P 500 and Nasdaq Composite index.
There's a lot to unpack here. I am -- after all -- still beating my benchmarks. And I've both taken money out and put it into my investment accounts over the past decade.
But the fact remains: if I would have just bought those stocks and then pursued other interests over the past decade, my results would actually be even better!
Here's the funny part: I have absolutely no regrets about the path I've taken.
If you are investing in individual stocks purely for the financial gain -- but you hate all that goes into making such decisions, then this isn't for you.
And that's 100% okay. Just put your money in an index fund and go live your life!
Every weekday morning that I get up, I feel lucky. I love learning about new companies. I love learning new mental models. I love being right about investments. And -- begrudgingly -- I love the lessons I have to learn from the mistakes I make.
How much is that worth? I don't think I can put a price tag on it. And, certainly, I want my returns to be as great as they can be.
But the bottom line remains: only follow us if you love the process of investing. If you don't, there's no shame in saying so. And if you put your nest egg in a low-cost index fund, there's not much penalty for that, either.
Wishing you investing luck in the months ahead,
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Brian Feroldi, Brian Stoffel, & Brian Withers
Long-Term Mindset
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