Pepe Invests
Retail Investor, Stocks, Real Estate, AI & Bitcoin
ETFs are a phenomenal starting point for new investors because they diversify, have delivered great historical returns and teach how markets move. New investors rarely find a 10x stock right away, and even if they do, they usually lack the conviction and emotional control to hold it. With money in broad funds such as S&P 500, Nasdaq-100, total-market, growth, value and dividend ETFs, they can spend their time studying companies and raising income to contribute more each month. x.comÂ
Low-cost growth ETFs can build serious wealth through exposure to the best companies and strongest trends, without managing individual stocks. A clean setup is a core of VOO or VTI, a growth tilt through SCHG, VUG or QQQM, and an aggressive tech tilt through VGT. The ranking is SCHG, VUG, QQQM, SPYG, VGT, MGK, then IWF, which is solid but costlier. Many overlap, so owning all adds little diversification, and growth-heavy funds can be hit hard by rising rates, tech selloffs or rotation to value. … Show more
Buying a broad index fund consistently over many years is one of the best strategies for most investors because it is simple, diversified and easy to stick with. US funds tracking the S&P 500 or Nasdaq-100, optionally with non-US exposure, have historically returned around 8-10% a year on average for patient holders. They are less volatile than individual growth stocks, need little upkeep and spare investors from reacting to news. UK pensions locked until 55-57 make holding long easier. x.com … Show more
The US stock market as a whole is pretty expensive relative to history, making this a better time to pick individual stocks than to put a lump sum into an S&P 500 index fund. x.comÂ
Owning the S&P 500 and Nasdaq-100 through low-cost index funds captures tomorrow's winners as they emerge without predicting them, since both indexes keep replacing fading companies with stronger ones. Since inception, the S&P 500 fund is up about 814% and the Nasdaq-100 fund about 1,683%. Contribution rate matters more than timing: $400 a month at 10.5% for 30 years grows to about $876,000, double the $438,000 from $200. x.comÂ
The Vanguard S&P 500 ETF works as a foundation that doesn't depend on getting every stock pick right. It gives exposure to about 500 large US companies for a 0.03% annual expense ratio, roughly $3 a year per $10,000 invested. The plan is to keep adding to it over time and build individual stocks around it. x.comÂ
The S&P 500's elevated P/E masks concentration in just a few stocks, making index exposure less appealing than selective stock picking for risk and reward. Its P/E is well above the ten-year median; digging into individual constituents looks more sensible than buying all 500. x.comÂ
Extreme fear has historically offered strong long-term S&P 500 buying opportunities. After VIX spikes above 30, 35 and 40, average 12-month S&P 500 returns were 23%, 28% and over 30%, respectively; after spikes above 40, returns were positive more than 90% of the time. x.comÂ
Buying an S&P 500 index fund at 26 is an incredible strategy for reaching future financial freedom, because of the time value of money over a long horizon. Allocating capital to individual stocks is fine, but the index fund should not be forgotten. x.comÂ
JEPI, JEPQ, SPY, QQQ, QYLD, RYLD, XYLD and SGOV are worth selling, because their more retail-friendly equivalents offer lower fees, better performance and tax savings. x.comÂ
US large caps offer a chance to buy into the world's largest economy at a discount, because the US PEG ratio has derated in recent months to levels very similar to the rest of the world. Never bet against America. x.comÂ
