OTW #42: Problems with passive investing, getting kids involved with investing, and more
Important financial stories to check out over the weekend
Hi Antagonist readers,
It’s time for another issue of “Over the Weekend.” I was moving last week, so this edition will be a bit shorter than normal.
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1. Problems with passive investing.
In a fascinating episode of the Stansberry Investor Hour podcast, Michael Green explained how passive investing has created a “market” that isn’t a market at all.
Green is the chief strategist and portfolio manager of Simplify Asset Management. He makes a strong case that buying stocks without any reference to fundamental data—which nearly all of us do within our retirement plans—leads to a strategy of mindless buying.
This investing style has worked well for the last few decades, but the retirement of millions of Baby Boomers may change everything.
According to Green…
We’ve actually created a utility that we call the markets that are being used largely to fund the retirement of Baby Boomers and others...But that’s not what markets are designed to do...
Then you suddenly are trapped in a situation where you have to say, “Is the government willing to stand by and let the retirement system fail?”…What we're trying to do in using markets to create a retirement mechanism is wrong.
Antagonist’s take
If you have a 401(k) or similar retirement plan, invest in target-date funds, and/or dollar-cost average into index funds, you’ll want to listen to this episode. It’s relevant to you whether you’re just starting out or already retired.
2. Getting your kids involved with investing.
Last week, I shared these stats showing how Muscular Portfolios continue to beat the S&P 500 on every metric that Wall Street uses to evaluate performance:
But there are even more benefits to Muscular Portfolios than monetary success. One Antagonist reader commented how the Papa Bear strategy has led to some great conversations and quality time with his daughter:
Still enjoying spending time with daughter each last trading day of the month making any adjustments per the Papa Bear Portfolio. We speculate together on why the changes occur. Great excuse to spend [time] together while she’s away in school.
For more details on the Papa Bear Portfolio, check out this article.
Antagonist’s take
The comments above are from
. Chuck also publishes a fantastic newsletter of his own called . He uses cartoons and comedy to comment on how technology is changing society. I’m a subscriber and definitely recommend it.3. The McRib is good for stocks.
On a lighter note…is the McDonald’s McRib what stocks need right now???
Ritholtz Wealth Management COO and “Of Dollars And Data” founder Nick Maggiulli found a correlation between the S&P 500 and the McRib’s availability. (Source: Valérie Noël on LinkedIn)
Last thing...
To limit the length of Over the Weekend to 5 minutes, I can only highlight a few stories.
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Thank you for reading, and have a great weekend!
Jason Milton
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