
Ask HN: What's the best way to get 5% on a million dollars? - hpvic03
What do you think is the best way to get the lowest risk, 5% annual return on a million dollars?<p>I&#x27;m also interested in how you could get 8% or 10%, though I know that would likely include more risk.
======
tmorton
I think you're looking at this the wrong way. Decide the level of risk first.
That dictates your stock/bond mix. After that, you get whatever the market
gives you.

If you're looking for a guaranteed 5%, it doesn't exist right now, and it
won't be back unless inflation spikes close to 5%.

~~~
adventured
AT&T pays a 5.3% dividend. Given they're still effectively splitting a
monopoly with Verizon, that's pretty close to guaranteed. You'd want to track
the company's quarterlies, the competition (risk of a combined Spring +
T-Mobile hurting them), and any big business moves, but otherwise it's
predictable. The stock itself - and your principle - would get compressed in
any market down turn though. The nice thing about holding T, is that you can
liquidate your entire principle at any time easily.

~~~
chalst
The last big bond issue by AT&T paid 1.4%

[http://www.bloomberg.com/news/2013-11-20/at-t-said-to-
plan-o...](http://www.bloomberg.com/news/2013-11-20/at-t-said-to-plan-
offering-of-2-billion-in-five-year-bonds-1-.html)

I'd not call the NPV of any tech stock predictable.

------
JoshTriplett
> What do you think is the best way to get the lowest risk, 5% annual return
> on a million dollars?

You won't find a zero-risk 5% return; those don't exist. Bank accounts pay
approximately zero interest these days.

The lowest-risk return would be to buy an index fund based on the entire stock
market, balanced with a fund that buys low-risk bonds; choose a stock-to-bond
ratio based on your desired level of risk.

Vanguard has the best index funds in the industry, due to their minimal
administrative overhead (0.05% to 0.1% of return). VBIAX is a nice balanced
fund that's 60:40 stocks:bonds, which is quite risk-averse. If you want to
choose a different ratio, go with a balance of VTSAX for stocks and VBILX or
similar for bonds. You could choose anything from 100% stocks (if you don't
mind riding out market crashes like 2008's) to 100% bonds (if you're extremely
risk-averse and don't mind low returns).

If you're trying to use this as an income, Vanguard has the option to
automatically send returns to a bank account rather than reinvesting them.

If you're talking about investing a million dollars all at once, you probably
don't need to worry about dollar-cost averaging; if you're saving up a million
over time, you should invest a fixed amount every paycheck no matter what the
price is. No matter what, don't try to beat the market; you will lose.

> I'm also interested in how you could get 8% or 10%, though I know that would
> likely include more risk.

Same way, just change the ratio. If you have a high tolerance for risk, such
as if you're a long way from retirement or you're otherwise flexible in how
much return you get each year, buy 100% stocks (VTSAX); the return was 33%
this year, 18% average over the last 5, and 8% average over the last 10 (which
_includes_ the 2008 crash).

~~~
NateDad
Yes, thank you. This is the only sane answer.

Putting money in the stock market in anything other than an index fund is just
folly. Over any significant amount of time, any other stock investment will do
worse than the index fund. It must, by definition (plus or minus a little bit
for imperfect efficiency... but the stock market is pretty damn efficient)...
plus index fund fees are just so much lower than anything else, which just
increases the lead they already have.

And yes, then bonds to smooth out the ups and downs if you can't afford to
ride out some big swings (like 2008) without some insurance.

------
mdisraeli
Disclaimer: I'm not a financial advisor, I don't play one on TV, and I don't
have a million dollars or equivalent.

Take $10,000 (1%), and accept it as money worth spending. Network well,
contact friends, family and ideally successful professionals and discover a
financial advisor you can trust. Get empirical proof of this, as many may just
be out to fleece clients - and worse, think they're actually doing a good job.

In terms of getting good advice, accept that money will have to be on the
table. People have to make a living, and if there's nothing to gain, then why
should a good professional waste their time? My hunch is that a good financial
advisor will be happy to take a lump sum consultancy fee, rather than a
percentage management fee, just to give you general advice - especially one
that knows their clients are your friends and will react to any stupidity the
financial advisor says.

With that money set aside and taken as ceded to the task of figuring out how
to manage your money, take some time out and learn enough to make reasoned
decisions. Research, study, understand the basics and importantly - understand
the absolutely stupid and worst options, and the worst that sound like the
best. It won't get you that much time, but it gets you more than nothing.

Given you're making 5% minimum, a 1% loss can be fixed in a year and regain
you access to any of the funds that you fell below the minimum for. But the
time and effort spent now is better than finding out in ten years that the
risk-free 5% growth option was actually highly risky indeed....

~~~
abofh
While I agree with the general concept, investing 10k comes with a
substantially different cost/risk/benefit profile to investing 1,000k. The 1%
rule is a great general rule for a single investment, but to invest 99% of
your porfolios gain on 1% risk seems like asking for 1995 google stock.

My personal investment in this profile is about 10k per position [equity] and
up to 15k per position [option risk] - where a position is defined by the
total risk as affected by the underlying stock - you still could end up with
100 positions with a 1mm portfolio, but usually by 20-30, you find ones that
you understand well and have reason to believe are undervalued -- those are
when you break the 1% rule, and you do it a couple of times. Some will become
worth less than 1%, some more than 10%. Re-balance judiciously, hold if it
produces income greater than its risk, and sell anything not nailed down when
someone offers you a gold-laying goose for it -- you can always by short-term
risk with options if you're that confident, and cash is infinantly more
exchangeable to immediate needs than paper stocks held at the DTC are to your
grocer.

Depending on your age, if you have little to no investment experience, i'd
check out the professional lists at fool.com (rule your retirement, etc) -
those are the profiles I put my family in. If you're bored and looking to day-
trade, there are similar lists for options, but those are for play money or
experienced readers, not retirement money.

~~~
mdisraeli
Great comment, although I think I didn't make the intended use of the 10k
quite clear enough. Whilst one way of spending it is in live experimentation,
yes, and that can be a very good option, I meant it more in a "be prepared to
pay for help, with the only return being knowledge" sense

------
bushido
After rewriting my response 3 times I decided to lay out some basics.

basics

\-----------

a. The most common fallacy in investing is that higher risk equates to higher
returns.

b. Any half decent investment strategy should have a solid risk management
strategy, should account for (and discount) inflation and should have a
strategy in place to emulate dollar cost averaging (most commonly by scaling
into investments from a cash position or using a re-balancing strategy). Risk
management (and discipline to follow it, being the most important).

c. Different sources of returns are taxed very differently, for example: most
non-govt interest income is taxed at the marginal tax rate, so if you're at
30% tax rate, 5% interest is actually 3.5%.

Then to be safe deduct the inflation, if the inflation is 2%, the real rate of
return is 1.5%.

d. The next thing to consider is the goal of return. Is it geared towards
income or growth(compounding).

e. If you are looking at percentage return it implies that you want growth.
But that may not be the case. If you instead want an income of $50000 the
whole situation changes, even though the value is the same. Simply because, if
your investment loses 10% value now your 900k requires a 5.555% return to net
the same $50000. I have seen and know a lot of people who went bankrupt for
not understanding this, the bigger problem is I know more financial
professionals who don't understand the distinction.

example scenarios

\--------------------------------

1\. If the goal is income, the strategy should be funneled to account for
recessionary periods, market corrections etc. I can explain a funnel in more
details on request.

2\. If its for growth and you want to get a higher return with lesser risk a
leveraged risk reduction strategy can be employed. Can explain further on
request.

3\. For people older than 45 (preferably older that 55) an Insured Annuity is
also an nice option when Income is the goal. Even better if they are not
healthy (higher mortality risk, higher return).

Before doing anything a good amount of reading(books) would be ideal, start of
with:

a. The richest man in Babylon(fiction) - read first, no particular order after
this

b. The Ivy Portfolio

c. The intelligent asset allocator

d. The permanent portfolio

e. The Investor's Manifesto: Preparing for Prosperity, Armageddon, and
Everything in Between

f. Value Averaging

~~~
hpvic03
Thanks for all the information! I may contact you for more info soon.

------
hkmurakami
The best and only way is to educate yourself, so that you won't be at the
mercy of financial advisors (who are just salesmen) or flawed financial
products.

~~~
raintrees
Yes. Increase your financial IQ, as it were. My wife and I run a service
business to keep bread (organic) on the table, hired our first coach,
researched, and are now purchasing investment properties that realize >= 9% on
investment, and since they cash flow, continue providing returns. In addition
to all of the tax advantages (we live in the US, so US tax law, but similar
elsewhere).

Now we just hired our second coach, and will be learning paper asset
strategies for cash flow and for capital generation to continue purchasing
real estate.

FWIW: I think that we are successful so far because we believe in ourselves
and put in the hours and sweat.

------
mikeryan
I'd buy a small newer (post 1979 construction so no rent control) rental
property in San Francisco. With that much down you should be able to get it
cash flow positive plus increase your equity at the same time if you needed to
liquidate.

~~~
gaoshan
I realize this is San Francisco we are talking about but the idea that
$1,000,000 is merely a down payment for a small living space is mind boggling
to me (yes, I live somewhere much less desirable and much cheaper).

~~~
anthony_franco
I think what he means is that with $1MM you'd be able to pay off a large chunk
of the house which would reduce the amount of interest owed. It doesn't
necessarily equate to just being a 20% down payment.

------
Theodores
Buy a flat in Battersea, London, get some letting agency to manage it for you
and reap the rewards:

[http://www.londonpropertywatch.co.uk/average_rental_yield.ht...](http://www.londonpropertywatch.co.uk/average_rental_yield.html)

Who cares if you are pricing someone else out of a place to live in London?
Seemingly nobody cares. The government love it that there is rampant house
price inflation. The ride should be good for a while. Wherever you put your
money it will not be immune to the next big crisis of capitalism, in London
property you will be well insulated.

As well as the return in rental, you will also have a property that will
appreciate in value over time. Sure you might have to sit things out when the
property market is depressed, but I would be surprised if your $1M flat is
worth less than that in 5+ years time even if the whole housing market goes
2008-style again.

------
gumballhead
Just buy the S&P and make 30% a year. The Fed's got your back! If that's not
good enough, buy the Nasdaq or Russell.

------
11thEarlOfMar
Municipal bonds will yield 5-7%, very safe, all will be state tax free, some
are also federal tax free.

LendingClub can yield 10%+. You have to be pretty engaged, since you'll need
to loan a small amount to a lot of people. At $1M, probably $2,500 to each of
400 people so the risk of default (there will be defaults) is diversified.
You'll have to actively re-invest the principle/interest. But it pays back
monthly and is kind of like paying yourself a salary in some respects.

~~~
hpvic03
Do you have personal experience with LendingClub? I'm curious as to how
reliable their returns are and how much work it takes.

~~~
11thEarlOfMar
Yes. I've been experimenting for about 8 months. You need to attend to it at
least on a monthly basis. The payments start to add up and you either want to
take them out for spending, or reinvest them to keep the interest coming.

The key metric for LendingClub is the predicted default rate. If they are
accurate, you can have good predictability of results and good returns. If
not, then it's a long term problem for them. One might assume that their
algorithm should improve as they get more data, and I'd love to hear from
their modeling statisticians how that works, though it seems pretty close to
their core IP. So I am taking it on faith a bit that they will get that part
right.

My experiment was to lend $25 to 100 people. I loaned to the same rated
borrowers so I did not have to deal with too much tracking. All pay 17.6% and
there was a 5% predicted default rate and about 0.65% fees. Net yeild to me
was predicted to be 11.95%. Fees are only paid on what is actually paid back
to me.

At this time, 8 months in, I have 99 current 3 more than 31 days late 0
defaulted 0 charged off 2 repaid in full 11 sold at full price

The reason there are 115 total is that I loaned to more borrowers as payments
came in.

I also put 15 up for sale on LendingClub's sister site to see how one might
exit. 11 sold in a couple of days. The other 4 are still offered. Not sure why
they have not sold yet, I put them up for sale last Friday.

The actual 'Net Annualized Return' as calculated by LendingCLub on my notes is
18.07%. That is expected to drop each time there is a charge-off.

I do expect some of the >31 day late to fall into charge off, but you can
review the contact history between LendingClub and the borrower when
LendingClub is trying to collect late payments. Checking one right now, I see
that a payment is processing, so it looks like they are back on track.

------
byoung2
I'll preface this with a disclaimer: I don't have a million dollars and I am
not an investment professional. That said, as an amateur investor, my gut says
that with the fed keeping interest rates low for the short term, you won't see
5% without taking on some risk. With the 10 year treasury at about 3% [1],
that's about the best you will see for the time being as far as low-risk
investments go. Slightly more risky but still pretty safe would be AAA
corporate bonds, which are currently 4.6% [2]. To get to 8 or 10%, you'd have
to get pretty risky, and go with junk bonds, or high yield dividend stocks
like REITs (I've gotten 11% returns over the past 3 years with these). If you
want anything higher, then you'd have to take on more risk than I have the
appetite for, like angel investing.

1\. [http://www.treasury.gov/resource-center/data-chart-
center/in...](http://www.treasury.gov/resource-center/data-chart-
center/interest-rates/Pages/TextView.aspx?data=yield) 2\.
[http://research.stlouisfed.org/fred2/series/AAA](http://research.stlouisfed.org/fred2/series/AAA)

~~~
mrfusion
Can you recommend some good REITs for high dividends? Is there anything
special you do when researching them?

~~~
byoung2
Like I said, I'm just an amateur, so I wouldn't be qualified to recommend any
stock in particular. I signed up for a an account at dividend.com and looked
at their ratings to see what to invest in. Anything above 20% seemed too good
to be true, so I focused on a few with yields between 10 and 15% that had long
histories of paying out.

~~~
mrfusion
I always assumed anything that pays over 5 or 6% these days has some
fundamental problem and I should stay away.

Is that not necessarily the case? Why aren't more people buying good high
dividend stocks and pushing the yields down?

~~~
byoung2
REITs are different from normal stocks in that they get a tax break if they
distribute at least 90% of their taxable income to shareholders each year, so
their yields are much higher. REIT yeilds (and stock prices) should continue
to rise now that housing prices are rising, and the overall improvement in the
economy is creating growth in commercial real estate.

------
cmer
I've been pretty lucky with Canadian bank stock.

In Canada, there's pretty much zero competition in the banking industry
because of how it's regulated. The risk is generally minimal (not factoring
macro economic risks) and the returns somewhat steady.

These stocks typically will return a 3% dividend plus some minimal growth. Add
it all up and it's fairly easy to get a 5% return if you diversify a bit. I
personally own BMO and RY. It has worked well.

~~~
abofh
go back 5 years; I have some IBOC that's just breaking even =)

~~~
cmer
5 year on BMO and RY:

[http://www.google.com/finance?q=bmo&ei=FjDOUqiwMZGQqwHDJQ](http://www.google.com/finance?q=bmo&ei=FjDOUqiwMZGQqwHDJQ)
[http://www.google.com/finance?q=ry&ei=GzDOUtiwAoGEqgHvUA](http://www.google.com/finance?q=ry&ei=GzDOUtiwAoGEqgHvUA)

Plus 3.77% and 4.34% yield, it's not a bad deal at all!

------
lhl
If you are looking for the lowest risk, you could look into some sort of
annuity - you should be able to get something close to the percentage you're
looking for. These things are complex and varied so you'd probably be wise to
consult one or more certified financial professionals before doing anything
rash. (I'd carefully factor in inflation for your returns for example.)

My personal approach to investing has been to get acquainted w/ the basics of
Modern Portfolio Theory (see: A Random Walk Down Wall Street) and then do a
couple things:

* Set a sane asset classes allocation. Indexes are good where applicable. The less correlation the better: [http://www.indexuniverse.com/publications/journalofindexes/j...](http://www.indexuniverse.com/publications/journalofindexes/joi-articles/3220.html?fullart=1&start=7)

* Rebalance regularly - once a year is fine

* Take advantage of tax efficiency where possible (tax loss harvesting, tax-deferred investing)

If that's too much work, you could do worse than parking your money in a
Vanguard LifeCycle fund, which rebalances for you:
[https://investor.vanguard.com/mutual-
funds/lifestrategy/](https://investor.vanguard.com/mutual-funds/lifestrategy/)

BTW, if you're talking about real and not hypothetical money, $1M net
investable makes you a "high net worth individual" \- while I wouldn't
necessary recommend going w/ a financial advisor (if you do, be sure to get
personal/professional recommendations), you should at least avail yourself to
some pitches to get an idea of what's out there. Initial consultations are
typically free and you can ask them your exact question yourself. I'm sure
they'll be more interesting answers than "buy a house in X."

------
femto
I just searched on [http://www.infochoice.com.au/banking/savings-account/term-
de...](http://www.infochoice.com.au/banking/savings-account/term-deposit-
interest-rates.aspx)

and it returned a 5% p.a. term deposit with RaboDirect for a 5 year term on
amounts from $1000 to $2,000,000.

[http://www.infochoice.com.au/banking/term-
deposits/rabodirec...](http://www.infochoice.com.au/banking/term-
deposits/rabodirect/rabodirect-term-deposit/9102)

~~~
willthames
I suspect the OP has USD, and that the RaboDirect account will be in AUD.
Investing in AUD would be a bold investment approach, and certainly not risk
free.

~~~
femto
Probably!

Interestingly, if I had $1m to invest and split it with my wife, with
Australia's tax cutting in at 19c for each $1 over $18,200 up to $37,000, we
would pay $2584. Since we have children, we qualify for a tax break called the
family tax benefit [1], which would pay $13,773 per year. Total post-tax
return would be $61,189. A yield of 6.12%, risk free! Now where did I put my
million dollars?

[1] [http://www.humanservices.gov.au/customer/enablers/online-
est...](http://www.humanservices.gov.au/customer/enablers/online-estimators)

------
ameister14
Pretty simple. Buy an index fund. Average return of 10%.

~~~
adventured
Unless you happen to be buying near the top of another stock market bubble.
Then you might easily see a negative 50% return over the next 10 or 15 years
inflation adjusted.

------
jarsj
Move to India. 9% annual return, 0 risk.

~~~
wroyster
India's inflation is around 11%. Plus after taxes you're down to 6-7%. (Indian
here)

~~~
jyothepro
how did u arrive with the 6-7% number, just curious

------
djoldman
Use it all to buy shares of DNP. At today's closing price of 9.34, the monthly
dividend of 6.5cents will net you 8.35% per year (not counting compounding,
higher if you have a divident reinvestment plan). After taxes you should still
be above 5%.

~~~
michaelrhansen
Please be careful and understand what type of fund this is before choosing
this investment.

------
natrius
There are going to be a lot of appropriately downvoted Bitcoin comments, but
consider what effects the true believers being correct might have on
traditionally safe investments, like bonds.

~~~
edwardy20
None?

------
Kanbab
Contact a commercial real estate agent, invest in a NNN property in most major
cities. Getting 5% unleveraged is extremely easy, if you leverage you should
be making over 10% per year.

------
tmktmk
5% won't be enough to outpace inflation in the next 10 years. Invest 100% now
in 20 different companies at $50,000 each, with the expectation that one will
go 30, 40 or 50 to one.

------
rhc2104
If you use Wealthfront (www.wealthfront.com), a risk score of 6.5/10
supposedly has a median return of 5%/year.

Pretty risky, though. Over 70% stocks.

~~~
nikoftime
How does that compare to Betterment?

~~~
rhc2104
Wealthfront is very rigid on its asset allocation. You pick a risk score, and
that's it.

Thus, they can do some pretty interesting things that Betterment can't. Such
as, if your assets are more than 500k, they replace the S&P 500 index with all
500 stocks, which increases the amount of tax loss harvesting.

------
mikekij
There are a few startups that are letting investors fund student loans. People
pay 7% to sallie Mae, so I think these investors get about 5%.

~~~
guyinblackshirt
one of them is prodigy

[https://prodigyfinance.com/investor_home](https://prodigyfinance.com/investor_home)

------
tyler-codenvy
Here is an unusual one. I have followed this similar strategy for the past 4
years on a more aggressive plan, and have returned 36%, 28%, 33%, and 6% for
the past four years. The strategy heavily shorts the market, and goes
partially long in a way that 99% of the time generates reliable, steady
returns, and in the 1% extreme cases offers adjustment techniques to handle
what the market is giving you. The aggressive nature of my approach causes the
high volatility in the returns, but a much safer approach can be taken which
would have nearly a 99.9% assurance of the 5%.

Sell calls and puts on the SPX index on a weekly basis. You need to generate
$1K of income each week. On an account that uses Portfolio Margin at a broker
like IB, $1M would allow you to open nearly 100 contracts on both the call and
put side.

To appropriately manage risk, at the SPX trading at $1840, you could open up
50 calls at $1935 with 1 week to expiration for $.05. This will generate $250
of income as long as the stock market doesn't climb >6% in a single week. This
has happened in the past, but only after the market has crashed the day
before. 3% climb in a single week on a broad based index would be a once in a
generation blue bird event, so the risk on this money is incredibly low. And
even if the market did climb up steeply suddenly, there are many options
adjustment techniques where you give yourself more time, generate more income,
and create additional buffer to stay away from the market.

By selling 50 calls for $.05, you still need to generate $750. You do this by
selling puts on the offsetting side. Markets have a tendency to crash
downward, so you want to sell far fewer contracts and buy some insurance for
the rare case of a market crater situation. You could sell 15 puts at $1730,
again 6% below where the market is currently. A 6% drop in a single week is a
rather rare event. And to hedge against a flash crash event, you buy $.10 puts
at $1515. In the rare event that the market crashed or the market did drop >5%
in a single week, then the same sort of adjustment techniques available in the
call scenario exist here. There would be a side benefit of while you have to
adjust the trades to wait for the profit, the market's volatility would have
skyrocketed and the potential to gain more money is really high. Essentially,
you could make your $1,000 of income by being 10-15% away from the market with
high volatility instead of being 6%.

This technique requires weekly trades to be opened, which is a bear. And you
have to learn the adjustment techniques, but once understood and accounted
for, things are pretty regular and consistent. There is a side benefit of
these options being 1256 contracts in the US, so there is beneficial tax
treatment. Even though your trades are 1 week long, 60% of the gains are long
term cap gains treatment.

So this isn't entirely low risk, but in all of the scenarios where is a bond /
stock mix, there is inherent market risk as well. Even bonds that payout 5%
can drop in value, so the principal isn't $1M anymore. So finding a great
balance is a lot of work.

Selling strangles on broad indexes is a type of diversification, just of a
completely different nature.

I have a fairly involved white paper that I have drafted that outlines the
strategy for anyone that wants to review it.

~~~
buzzsaw
I'd like to have a read of that with paper. can you post a link?

~~~
tyler-codenvy
Hi: I placed a link in my public Dropbox.

[https://dl.dropboxusercontent.com/u/9657839/Investment%20Fun...](https://dl.dropboxusercontent.com/u/9657839/Investment%20Fund%20Approach.docx)

------
vbrendel
Clearly not a good question to ask on HN... surprised bitcoin hasn't been
mentioned yet :-)

edit: it has now. I rest my case.

------
justinzollars
You could invest in my startup.

~~~
Theodores
Why?

~~~
antidaily
It's a time machine.

------
icvx
[http://www.dogsoftheseason.com/](http://www.dogsoftheseason.com/)

Is this true?

If not, please explain why not?

~~~
pa5tabear
He doesn't say how to choose the right stocks. And I assume he's choosing them
after the fact for his graph.

I'd be curious to see a random sampling of S&P 500 in autumn vs. spring. That
would give a better idea of if it works.

~~~
icvx
> And I assume he's choosing them after the fact for his graph.

So it's possible to edit tweets or change their timestamps?

[https://twitter.com/DogsOfTheSeason](https://twitter.com/DogsOfTheSeason)

~~~
DogsOfTheSeason
Hi, I'm Tomo - the owner of the DogsOfTheSeason site.

I don't know about the timestamps, but I guess it's possible to write several
stock recommendations and delete the ones that do not make profits. Also, it
is possible to build dozens of sites like DOTS and promote only those who
consistently earn money.

I can assure you that I don't do any manipulations with my performance. I
don't do almost any marketing for DOTS. The number of my subscribers is very
small and if it starts to grow significantly, I'll limit the maximum number of
subscribers or raise the subscription price.

I guess there are sites that do manipulate with the performance, so you have
to decide for yourself whether you're going to believe me or not.

I noticed that links on my page
[http://dogsoftheseason.com/subscribe](http://dogsoftheseason.com/subscribe)
(actual emails) were not working due to a missing script. Now this is fixed.

------
hpvic03
How did this just get bumped to the third page of HN? It was on the front page
just 1 minute ago.

------
craigvn
Buy a house in Australia.

------
frankwiles
But not 9% that would just be weird...

~~~
hpvic03
I'm specifying those numbers because I expect they will each come with
different risk levels. 9% is fine too.

------
pa5tabear
BitCoin

~~~
clamprecht
I wouldn't disagree, except I'd only recommend putting a small percentage,
like 1%, into it, unless the OP is a big believer. In that case, maybe 5% max.
And in all cases, only put in what you can (really) afford to lose without
losing too much sleep.

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skylan_q
ETFs: [http://en.wikipedia.org/wiki/Exchange-
traded_fund](http://en.wikipedia.org/wiki/Exchange-traded_fund) and REITs:
[http://en.wikipedia.org/wiki/Real_estate_investment_trust](http://en.wikipedia.org/wiki/Real_estate_investment_trust)

Are other investments you can look into. A mix of some blue chips that pay out
dividends in combination with some ETFs which trade in commodities or specific
growth markets might be a good idea. Balance out that risk with bonds or other
instruments.

------
marincounty
I would buy property in Marin County if I had a million dollars. One house. A
neighbor moved next to me. I scared him away--I think? (another story). He was
in his house for 5 months and made 90 grand on on a $650,000 investment. It's
a weird market here.

I'm thoroughly convinced 90% of stock gains are made through inside
information. I thought the Internet would level out the playing field, but it
seems like the wealthy "connected" types are always in a bull market? (This
year was an exception--everyone seemed to make money if they bought stocks?)

As to leveling out the winners in the stock market; I hope some young dude
makes an app--a app that would help investors who don't have wealthy friends.
And Stocktwits in not that app.

(I see a lot of posters advising on making money off renters. Personally, I
couldn't live with myself making a huge profit on Renters. A nice family moves
in and can just afford the rent, and the Landlord continually raises the rent.
It's not moral. Sorry, but a place to stay, especially if the family has kids,
is more than just a Revenue Stream. )

