Jurgis

It's not just ROIC - although perhaps you can only consider ROIC if you are going to hold forever. At least short term, valuations matter too, like @IceCreamMan indicated in their post (which I'm gonna +1 here ?) Assume an index of two companies A and B. A has ROIC 20%, B has ROIC 10%. A market cap is 10 times the size of B. Two situations: A trades at 100 P/E, B trades at 1 P/E. A trades at 10 P/E. B trades at 10 P/E. You never know (TM), but likely short term in the first situation EW will outperform, while in the second situation MW will outperform. Long term, the situation gets more based on ROIC and a bit less based on valuation. Though in extreme cases even very high ROIC business may underperform for very long time if it starts at extreme valuation.

FSPHX is not really growth. It's mostly old medical and pharma. Good fund historically, but not shoot out the stars growth. Well, since you asked: https://cathiesark.com/ ?? JAMFX I would respectfully ask to move any ARK discussion into ARK thread that exists somewhere. I'd rather AI thread not become ARK thread. ?

Biotechs: nah, there's a lot of biotech startups that are very dot-com'y. In fact, biotechs are mostly very binary: either you get 10-100x or you get zero. Sometimes you get zero after a very long time. Sometimes you get 10-100x after long time. Yes, the right thing would be to buy a fund that has a great DD insight into biotechs. I am not aware of such mutual fund or ETF that does better than XBI. I think someone on this site has in the past mentioned a hedge fund run by someone in Boston (?) that is really good at doing deep DD. I don't remember the name of the fund or the person. ?. And I'm not sure I'd invest. No, it was not Seth Klarman's fund - I know that he has a team that does deep DD on biotechs and buys some, but I don't know if his results are good. And in any case you mostly can't get into Baupost and Baupost's biotech results are swamped by non-biotech results. I think you asked me about XBI PE on the other thread. I haven't looked. And in any case, PE is not the way to evaluate biotech company or fund. You should use something like Price/TAM*ApprovalChance. Maybe not TAM, but DAM - drug addressable market. The issue really is ApprovalChance. (Well, there's also issue of competition/how well drug sells, but that is probably easier to predict.)

@LearningMachine: You are right that equal-weighted indexes have benefits: EW overweights smaller caps more. Smaller caps theoretically may grow faster, etc. If stock rises without change in fundamentals, EW sells it, which is selling expensive stock. If stock drops without change in fundamentals, EW buys it - buying cheap stock. EW is more diversified - theoretically - since no company can become big part of the fund. To be fair, there are negatives, as I mentioned: While underweighting large dead-wood bureaucratic companies, EW also underweights large growing monopolists. EW does not capture the business growth (vs stock price increase), so it might be selling stock that had price increase but valuation decrease. Same with buying stock that may have had price decrease, but valuation deterioration. The diversification is real, but frozen into the initial sector breakdown. This is a bit handled by external stock list changes. So ultimately, I don't know if there is a right choice. Maybe the right choice is factor investing. But that comes with its own set of issues. ?

I am wrong person to ask about biotech. Every time I tried to get into it, I found out that the amount of material is huge and it is very hard to get a deep insight into it. I think I'm gonna defer to FSPHX for old med/pharma and XBI for the new bio. I agree with your comments about valuations, pricing power risks, expirations, etc.

Sure, at some point SP100 captures any big wave. Because it is based on SP500, it missed TSLA for a long time, so maybe that's a ding a bit for both SP100 and SP500. My comment about biotech was more in terms of individual company investing and not indexes/ETFs. Leading non-bio AI companies are pretty clear. Leading bio AI companies are way less clear at this point IMO. That might be a reason for funds/etfs.

OK. I am aware of your bullish thesis on VZ and the attraction of spectrum. I am not bullish on VZ and I am not that interested in that area or VZ as a company to discuss it. Good luck.

Investing in highways is intellectually appealing ( autocorrect corrected that to "ineffectually appealing" - that too ?). However, if you did that in 1999, you would have ended with a lot of (near) donuts. Nortel. Ciena. Cisco (not donut, but still not back to 1999), Lucent. Even QCOM that was the one company to rule them all ( read "Gorilla Game" thread on Silicon Investor when you have couple weeks - and weep ) - only came back above 1999 levels last year. Yeah, if you DCA'ed, you'd done better. Still the "highways" or "picks and shovels" was not where the money was made mostly. So IMO careful with that approach.

Honestly IMO with funds the decision is more what you like and what you are comfortable with than trying to make a rational(ized) decision which fund will outperform. I'd say "who knows". There are pluses/minuses for all of them. One thing we did not touch: what if the next big wave is biotech or biotech AI? Then the answers are very different.

I am not investing in PLTR on principle.

QQQ maybe. I don't particularly like their selection criteria of being Nasdaq-only though. IWF/IWO maybe. You could go with some actively managed fund, but then you might do as well yourself maybe. Although I would like to hear if anyone has a good ideas for fund(s).

As you know, Google and Facebook were not public in 1999 and Facebook was not even a thing. ? I was there when Google started - I know some #-single-digit employees personally. I was stupid value investor enough not to join/invest. Apple was not the-real-Apple (TM) in 1999 yet. We already talked about Amazon-vs-Ebay on the other thread. Even assuming we avoided pets.com, investing in 1999 would have been Amazon, Yahoo, Ebay, ??? and out of these only Amazon worked out eventually. There is a big risk that that's the same situation right now. Although one could argue that AI requires huge companies with huge data sets and Google/Facebook/Amazon/Apple/Microsoft will win vs any startups. Looking from the positive point of view, for any non-value-investors, there was a very long time - 20 years so far !!!! - to invest into Google/Apple/Amazon/Facebook sometimes at quite attractive valuations. The only requirement was not to sell when valuations went above "value investor sell threshold". I mostly failed on that too. But this might be a good way to invest in AI going from today. The positive is that you can follow the companies and sell off the ones that don't deliver. It's not easy, but it is somewhat possible. E.g. even though I stupidly value-investor sold most shares that I acquired through the last 20 years, I have to say - pretty honestly - that I did not buy (m)any shitcos that did not deliver. So it is possible IMO to pick mostly winners. Anyway, what I own from AI now: Google, Microsoft, Nvidia, Amazon, Facebook. I own tiny position in TSLA. I own Apple, but I doubt it's going to be great AI play. I own tiny positions in some shitcos. I don't think there are other obvious AI investments right now. I'm interested to hear if someone has suggestions though.

Sounds like a plan. Do you have thoughts on how to do this? (Perhaps we should move the discussion out of JD board though ?)

@LongHaul did not target the notes and recommendation for people with depression. So maybe this is a bit OT, but: there are chemical imbalance causes for depression and other psychological issues. And there are situations where drugs just work (TM). I know people who tried CBT methods and they did not work much if at all, while minimal doses of drugs worked great. I know someone for whom the depression symptoms were due to vitamin D deficiency and fixing that got rid of the symptoms/issues. Not saying that drugs are always the answer, but sometimes they are. If it's at a level of clinical issue, find a good professional, preferably someone who knows both CBT and drugs. Good luck.

Yeah, funny how things go. Definitely not the "it was obvious" of the Monday morning quarterbacking that happens after the fact. ?

I was very much pro equal-weighted ETFs about 5 years ago or so. Based on the faulty logic that market-weighted indexes get top heavy with overpriced stocks. Now I'm totally on the other side of the argument. It's the Internetz age of winner-takes-most. You want to hold the best companies available, you don't want to overweight (or equal weight) shitcos. Do you really want to hold a fund that sells FAANMG every time these great companies go up and buys crapco every time it goes down? Plus currently most of the biggest market cap companies are reasonably priced (apart from TSLA maybe). I might have different opinion if FAANMG were all hugely overpriced and mid-small caps were cheap. I don't see that much. Also once you are buying equal-weighted, you are no longer buying the market returns. You are factor investing even if you don't call it factor investing. So maybe then you are better off explicitly factor investing? There are also structural issues with equal-weighted funds. They cannot be big or they have to hold huge stock percentages of the smallest stocks. Or they have to use synthetic positions. YMMV. I doubt you'll outperform market-weighted much if at all. But if for some reason it makes you sleep better at night, it's also likely not going to be a horrible investment. You may not underperform a lot either.

OT: If you think about it, EBAY could have been AMZN. They had the 3rd party platform way before AMZN. If they focused on commercial merchants and made it general shopping platform rather than auction/casual seller one, they could have Amazon'ed the Amazon. Coulda/shoulda. ?

Oh definitely. IMO poor people are screwed up either way: if they repair for $300, they are paying ~>1/2 of the new price and the appliance may break again; if they don't repair, they don't have money for new; if they buy "warranty"/"service plan", they are likely paying a significant chunk of the appliance price and the company may screw them with repair or replacement like it happened to your dad. I'm all for FTDR doing a better job with a better price/experience for customers. I just doubt that it works economically with USA labor prices. If they could fix an appliance remotely (from a call center in Bangladesh ?), this would be way better business proposition for everyone. Partially OT: a relative in Lithuania called a plumber for a minor issue. Cost? Euro10. I did the same in MA. Cost? $200. IMO this hugely matters.

I don't want to be Mr. Totally Negative on home services area (I've posted negative comments on ANGI), but as a customer I'm pretty negative on this. ? This is basically like extended warranties: it's mostly cash grab by the companies peddling FUD. In most cases, the homeowner likely is better off replacing the appliance themselves when they break rather than paying for warranty. Of course, your experience may vary. There is also the issue of companies playing dirty as @Broeb22 described: refusing repairs, refusing paying, refusing replacement with new/good appliance and replacing with used/crappy one. Definition: "Insurance company: a company that collects your money and refuses to pay out when something happens". ? Theoretically, it is possibly good to have your appliances regularly serviced because they are on a support/warranty plan. I think the issue in the US is the labor cost. Regular servicing works well in low-labor-cost countries, where the appliance costs 100x-1000x 1hr professional work. Then you can have yearly service at 1%-0.1% appliance cost. In US, where the labor cost is up to 10% (if not more) of appliance price, the service cost is equal to appliance cost through 10 years. So you are likely better off not paying for service and just replacing the appliance whenever it fails. JMO. Currently I have no service plans/warranties. I've had them in the past. Not horror stories but mostly "not worth it". Partially OT: I have done couple crappy-economic choices where I have called a repairman for an appliance, paid the base cost of $100-200, refused to pay exorbitant "real repair costs" of $300+, and just bought new appliance. The right thing to do was to replace it immediately without calling repairman.

They cycle the offers. "Free shipping no matter the order size" just means that there are very few good prices or sales. There have been way better sales/offers in the past - although mostly around Thanksgiving/Christmas.

I am too late:

US airlines should accept Doge coins for tickets. Their stonks would go ????, they could buy more Doge coins and use them to buy more of their stonks. This would be Space X on steroids.

These two paragraphs sound inconsistent. In the first you claim it's a fad. In second, you say that you'd like to take their classes. You can't have it both ways. If it's a fad, then why would you or others want to take their classes? If you and others want to take their classes, then it's not a fad. I think yetanothervalueblog does good job presenting pros and cons. Personally I want https://www.mirror.co/ classes with way more AI feedback. If/when they can provide AI-driven personalized classes, that evaluate your workout and make corrections, I'm plunking down whatever they gonna ask. It's way far away from that though. It's like level 5 full-self-drive for fitness classes. ??? Not interested in PTON products just because I don't use fitness bike or treadmill and don't plan to.

SYTE did better than ADBE and almost as well as NFLX. ? (@ anyone newish to CoBF: that's an inside joke ) ?

10 bagger is 1000% not 10000% ? Your screen is for 100 baggers not for 10 baggers. ?? You also have to be careful about what exactly the screen means by %. E.g my broker shows 100% gain which makes a stock 2 bagger not 1 bagger. The same way 900% gain is 10 bagger not 9 bagger.