Optimized Portfolio | John Williamson, APMA®

6.7K posts

Optimized Portfolio | John Williamson, APMA® banner
Optimized Portfolio | John Williamson, APMA®

Optimized Portfolio | John Williamson, APMA®

@OptimizedPort

Evidence-based financial education and fun stats. Part research, part ramblings. Tweets ≠ advice. YouTube vids at https://t.co/ITcRYaJeJ8

USA Katılım Eylül 2020
59 Takip Edilen2.7K Takipçiler
Sabitlenmiş Tweet
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
• Bonds beat stocks for 2000-2019. • Emerging Markets beat the U.S. for 2000-2020. • Global stocks beat U.S. stocks for 1970-2008. • U.S. T-bills - the risk-free asset - beat U.S. stocks for 1929-1943, 1966-1982, and 2000-2012. • 90/10 using ext. duration STRIPS - very long US treasury bonds - has beaten 100% stocks historically. The lesson? "Nobody knows nothing," 100% U.S. stocks is rarely - if ever - the optimal portfolio, and unexpected outcomes can persist for extended periods. Diversify.
English
3
9
75
8.7K
Axelroark
Axelroark@axelroark·
$SGOV dividend day is my favorite day of the month 💰
English
2
0
2
313
Into Absurdity
Into Absurdity@SubtleInduction·
@OptimizedPort I like that he turned off commenting, probably knew how many people would dunk on him for this BS
English
1
0
2
40
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
Reminder: If your return graph goes longer than ~15 years, log-scale your y-axis. Peter's 40-year linear graph here - and drawing a bogus conclusion thereof - borders on downright dishonest nonsense. Don't be like Peter.
Peter Grandich@PeterGrandich

We are now in the parabolic, melt-up phase. Where and when it peaks is anyone's guess. It's also the exit phase, not enter. Just remember, it's better to be a year too early, than a day too late.

English
2
0
11
950
Evan | Investments
Evan | Investments@NotA_Bull·
Adding to my cash position, it has now overtaken my $AMZN stake. I treat cash as a core portfolio position. I’m using $SGOV so it continues to grow while it sits. This is what fuels my other investments. Are you holding any cash?
Evan | Investments tweet media
English
10
0
36
2.9K
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
Brief lesson today on DCA and "buy the dip." If indexing, deliberately holding cash on the sidelines as "dry powder" to "buy the dip" tends to be an objectively terrible idea, for the simple reason that the market goes up more than it goes down, which is why lump sum investing (LSI) tends to beat dollar cost averaging (DCA), and which is why we're investing at all in the first place. It is highly likely that last week's price that had everyone in a panic was still higher than it was 6 months ago. On average, the longer you wait, the more that cash piles up, the more conservative your asset allocation becomes, and the more gains you missed out on by not being fully invested. All this is why we say to - and why any seasoned investor knows to - invest any investable cash as soon as it becomes available, basically a series of periodic LSI. I discussed all this in detail with numbers a while back here: optimizedportfolio.com/dca/?1
English
1
0
7
427
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
"Track record" is nice until it isn't (and it doesn't mean much in investing, as asset prices are basically memoryless). On the 50th birthday of the S&P 500, only 86 of the original companies remained. Google may not even exist, much less be a top company, 40 years from now. The top companies tend to rotate, and quicker than many realize. The challenge that graphic hints at is being able to consistently identify those rotating winners, which is something only about 1% of investors can do. Pros try to do that every year. Here's their most recent track record per the 2026 SPIVA report (src: spglobal.com/spdji/en/docum… ):
Optimized Portfolio | John Williamson, APMA® tweet mediaOptimized Portfolio | John Williamson, APMA® tweet media
English
0
1
2
30
Jack
Jack@Jack1145491·
@OptimizedPort @cashflow_king94 Interesting graphic, however I think if you’re investing in blue chip companies with a proven track record you’ll generally be ok. Obviously any company can fail. But I would rather invest £1k in Google than the S&P500 personally.
English
1
0
0
51
Cashflow King
Cashflow King@cashflow_king94·
Unpopular opinion: Most people would be better off with 5 stocks than 50
English
22
2
61
10.6K
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
@BoomerDivvies It's not an "outlook" but rather simply an honest reality and a few specific examples therein. In any case, certainly not "ridiculous." I've met 3 of those 4 people. You're speaking in vague idealistic fantasy. I also don't think you know what the word "dystopian" means.
English
0
0
1
14
DividendBoomer
DividendBoomer@BoomerDivvies·
People act like Sunday night is an emotional tragedy. But think about it, you’re at home, fed, relaxed and scrolling your phone. If that’s “bad,” your standards are broken. Enjoy life, it’s probably not that bad.
English
21
0
61
1K
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
Sure. None of that changes the likelihood of the average retail investor having a successful outcome long term from stock picking. Selecting and holding the same 20 stocks for 40+ years, regardless of "blue chip" status, is almost certainly a terrible idea. Who said anything about factors or connecting dots? The average person is not Buffett. He is the exception that proves the rule. Just because 1 person can "identify which stocks will outperform" does not mean the other 99 should try to follow suit. Pros try to do that every year. Here's their most recent track record per the 2026 SPIVA report (src: spglobal.com/spdji/en/docum… ):
Optimized Portfolio | John Williamson, APMA® tweet mediaOptimized Portfolio | John Williamson, APMA® tweet media
English
1
0
1
25
Five Points Capital
Five Points Capital@fivepointscap·
The problem with this research is it assumes there is no way to identify which stocks will outperform. Of course most businesses are unsuccessful long term. So are most baseball players. But we can see that some kids can throw the ball 95mph and others can’t throw it 70mph. We can make a reasonably educated guess which one is more likely to have a career as a professional pitcher. And I know you’d make the argument that the stocks that are more likely to be successful are priced that way but it’s just not always true. Stocks often get mispriced for fundamentally short term reasons because there’s a lot of money that is trying to perform well this year or even this quarter. It’s the problem I have with this particular strain of academic finance. People try to argue that Buffett simply discovered “the five factors” before Fama and French. When there are hundreds of hours of Buffett explaining exactly why $AXP, $KO, $AAPL, etc. are great businesses qualitatively. Things about the company’s products, their moat, switching costs, consumer behavior, but nope! None of that matters. Buffett was actually successful because he invested in cheap stocks with low rates of reinvestment. The attempt to draw conclusions by connecting two dots in an infinitely complex domain is foolish.
English
1
0
1
26
Five Points Capital
Five Points Capital@fivepointscap·
I agree with this. The bogleheads and Ben Felix types act like owning a portfolio of 20 blue chip stocks is the same as pulling a slot machine. It’s so dumb. Buying individual stocks is not gambling.
Jim Cramer@jimcramer

I know Warren Buffett says that we have never had people in a more gambling mood than now, but i think that is not necessarily the case. We are addicted to S&P 500 buying no matter what. We have been taught to love ETFs no matter what kind. If individual stock investing hadn't been so denigrated it would be less of a casino

English
3
0
13
2.4K
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
Yea I guess I'm inherently, implicitly referring to independent shops and CFPs specifically as a selection universe. Fiduciary should be the starting point. Fidelity and the like are probably going to be registered reps selling products and masquerading as "advisors." Again, it being a challenge does not mean negative value add on average. A "bad" advisor can also still be better than the person trying to DIY if the person lacks knowledge and/or is very susceptible to behavioral biases.
English
1
0
1
11
Colorado Rick
Colorado Rick@ColoradoRick1·
@OptimizedPort @JamieFinance25 The fact that it’s a challenge means that it’s often negative value add. Not because of my personal experience, but because of so many people using known bad actors (I particularly dislike Ameriprise, but Fidelity and EJ and RJ & Fischer are all pretty questionable shops imo.)
English
1
0
1
19
Investing isn't Boring
Investing isn't Boring@JamieFinance25·
Do financial advisors add enough value to justify their fees? I'm thinking most financial planning can be done by yourself until later in life when you need tax advice on withdrawals, estate planning etc. Thoughts? 👇
English
6
0
6
568
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
What kind of romantic, utopian, out of touch reply is that? In a perfect world, sure. But try telling that to the coal miner, or to the single mom working multiple jobs, or to the traveling salesman who has to leave his family every week, or to the barista getting berated daily making minimum wage.
English
1
0
1
17
DividendBoomer
DividendBoomer@BoomerDivvies·
@OptimizedPort I think people need to understand that work shouldn’t be dreaded. It provides the means to build wealth.
English
1
0
0
19
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
@ColoradoRick1 @JamieFinance25 Arguably exaggerated figures and a conflict of interest, certainly, but I would submit that finding a good advisor being a challenge (it is one, to be sure) and advisors in general having a nonzero value-add are 2 different things and are not mutually exclusive.
English
1
0
0
36
Colorado Rick
Colorado Rick@ColoradoRick1·
@OptimizedPort @JamieFinance25 Don’t get me wrong, some events demand good advice… but I’m not trusting self-interested parties to tell me their value, even Vanguard. I was burned young by an “advisor”, been DIY for decades. I hired an advisor relative to special needs estates, but I keep it focused.
English
1
0
1
43
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
I'll take what I can get. Thanks, Spyke!
Spyke X@Spykex02

@Alice_MiaX It's a shame because he writes some good articles and I'm sure he knows a lot about investing but the way he interacts on here is very...I guess pompous would be the word. I've seen a lot of blocks just this week lol.

English
2
0
3
428
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
@DilksJay Broadly speaking, Buffett and Munger were basically value investors in US large caps, and US Value has suffered over precisely that period. Will it make a comeback? Maybe. Maybe not. Is Abel looking to fundamentally shift Berkshire's Value-centric approach?
English
0
0
2
451
Jay Dilks
Jay Dilks@DilksJay·
I’m a Berkshire shareholder. Warren Buffet and Charlie Munger are all-time greats but they have tied the S&P 500 for 20 years to the day. I think people should be openminded that Greg Abel might be an upgrade in Management. I say that with no disrespect to Charlie and Warren but the scoreboard has slowed down scoring points. I sensed accountability of performance for the first time , in a longtime. Greg Abel might surprise people.
Say No To Trading@SayNoToTrading

Unless Abel re-invents the wheel, as I've said before, we should think of $BRK.B $BRK.A as merely a lower beta version of $SPY during selloffs. Milder drawdown for Berkshire, but inversely, milder upside during tech-fueled bull runs. Both exactly 694.6% return last 20 years.

English
45
9
277
69.7K
The Money Cruncher , CPA
The Money Cruncher , CPA@money_crunchr·
If you invested $10k in the S&P 500 from 2005 to 2024, you would have ~$71k. BUT if you missed just 10 best days, the value drops to ~$32k. Missed 20 best days, and it's now $19k. Most of the BEST days happen within weeks of WORST days. Stay invested, regardless of the news
English
1
0
9
424
Elyas Andkhoy, CFP®
Elyas Andkhoy, CFP®@elyasandkhoy·
@cashflow_king94 The number is somewhere in between. x.com/elyasandkhoy/s…
Elyas Andkhoy, CFP®@elyasandkhoy

How many stocks do you need to diversify a portfolio? The academic answers range anywhere from 20 to 50. As you increase your number of holdings, the behavior of your portfolio becomes less correlated, indicating a more diversified balance. Although when volatility drops, you do start to see diminishing returns. For the average investor, the simpler approach for stock exposure could be a broad market ETF. How many stocks do you own? 👀

English
1
0
1
215
Optimized Portfolio | John Williamson, APMA®
Optimized Portfolio | John Williamson, APMA®@OptimizedPort·
@Jack1145491 @cashflow_king94 ...for about 1% of investors. That's the part the "concentration builds wealth" people forget. x.com/TaxAlphaInside…
Brent Sullivan@TaxAlphaInsider

Many companies fail, while a few dramatically outperform. The paper below gives us more evidence that diversification kinda rocks. But but but... "Diversification is where conviction goes to die!" That's fine. I'm grateful you have conviction in your ability to pick stocks. Thank you for keeping markets efficient. 🫡 But, Antti Petajisto (of Brooklyn Investment Group, now @NuveenInv) shows that missing out on the outperformers is the real cost of making a concentrated bet (and getting it wrong). But there's also the catastrophic risk of holding a concentrated position in a failing stock that nosedives when you need cash, or simply never recovers. If this kind of thing interests you, I'm pleased to say Antti's partner, and Brooklyn CEO/CIO Erkko Etula will be at my conference, Basis Northwest, talking about concentrated position risk and tax management on a panel hosted by @chou_shang. On the main stage, he'll be joined by Nuveen colleagues Jill Jensen and Katrina DiFiglia to discuss risk and tax management across private assets, as well as many other solutions, including tax-aware long/short. See you in Seattle in only 36 days...

English
1
0
2
22
Jack
Jack@Jack1145491·
@cashflow_king94 Yep, diversification kills returns. Concentration in a few strong picks is what drives returns.
English
1
1
2
158

Keşfet

@axelroark @3535_sk @TexDoggie @SubtleInduction @returnstacked @avantisinvestor @alphaarchitect @SolutionOrganic