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In Today’s Podcast JL collins from jlcollinsnh joins Jonathan & Brad on the podcast to bring the Stock Series to life. The Power of Index Investing is one of life's greatest secrets & JL Collins is the ultimate travel guide. This multi part series turns the stock series into an interactive audio companion and this first part is sure to compel you to stick around for each additional entry
The Stock Series | Part 1
- Our guest: Jim Collins from JLCollinsNH.com
- The Stock Series Part 1: “There’s a Major Market Crash Coming!!!! And Dr. Lo Can’t Save You”
- Lo claimed that “buy and hold investing doesn’t work anymore” and that raised Jim’s ire quite a bit which led to the Stock Series
- An overview of the Stock Series and how Jim would explain it
- Jim’s eight rules that you need to understand in order to succeed with long-term stock market investing
- “The Market Always Goes Up” which is very counterintuitive to people, but over the long-term it invariably does
- The market is always going to stumble or have corrections and you can’t predict when they are going to happen and you have to accept them.
- Nobody can possibly predict or time the market
- The stock series came out of a series of letters to his daughters on financial education
- When it comes to investing (once you get the basics down correct) the less you pay attention, the better off you’ll be.
- Fidelity study of the best classes of investors based on performers: Dead people and those who lost their accounts!
- You can’t panic when the stock market goes down significantly. You must “know yourself.”
- If the market is already down 50% would you still be able to hold the course and not sell if you still thought it was going to do down an additional 2/3’s?
- Quotes from Warren Buffett about not being fearful and buying when others are selling
- For a new investor who is investing significant money each month, the best thing that can happen is a huge plunge in the market because they get to purchase new shares on a huge sale
- In a wealth-preservation state, you should consider buying a percentage of your portfolio in bonds
- Jim has a 25% bond allocation, which is actually considered very aggressive for his age
- Warren Buffett quotes about investing in low-cost mutual funds from Vanguard
- How does index investing deal with winners and losers in the index?
- Downside of each company is limited to them losing 100%, but the upside is unlimited
- The Dow Jones is not the “market.” Just an index with 30 large companies
- Stock picking contests in schools in the US are fundamentally looking at it the wrong way and are incentivizing short-term thinking
Hot Seat Questions
- Favorite blogs: Mad Fientist, Go Curry Cracker, Millenial Revolution, The Wealthy Accountant
- Favorite life hack: Public Libraries and geographic arbitrage
- Biggest financial mistake/advice you’d give your younger self: Understand the power and value of index fund investing much earlier
- Favorite purchase on Amazon.com this past year: new rechargeable electric razor
- Jim’s experiment in hotel living
Links from the show:
- The Stock Series
- Vanguard VTSAX
- 2016 Berkshire Hathaway Shareholder Letter
- 2013 Berkshire Hathaway Shareholder Letter
- Mad Fientist
- Go Curry Cracker
- Millenial Revolution
- The Wealthy Accountant (post mentioned in podcast)
- Jim’s favorite posts: ‘Mr. Bogle and Me’ and ‘Why Your House is a Terrible Investment’
- Jim’s electric razor from Amazon.com