Good news: These all-time highs are giving us another chance...

...to correct any "this won't end well" situations we've gotten ourselves into.

This thread contains a series of questions at the intersection of ego and unnecessary risks.

1/x

How concentrated is your stock portfolio?

Most risky to least:

1 stock, all-in
10-20 similar stocks (e.g. a bunch of SaaS-type names)
10-20 dissimilar stocks (across sectors, countries, etc.)
30+ dissimilar stocks
30+ dissimilar stocks + an index fund core
Fully indexed

2/x

Beyond your own portfolio, what's your true safety net?

E.g. Will your parents bail you out or are your parents relying on you to bail them out?

3/x

Where are you on the spectrum of a Buffett mindset ("never lose money") to an entrepreneur's mindset (10x or bust)? Emotionally, the former has to battle massive FOMO in overheated markets, the latter has to be able to withstand massive losses in down markets.

4/x

What's the furthest back you were investing money (and learning lessons)?

COVID-19
Flash crash
Great recession
Dotcom bubble
1987
Oil crisis
Vietnam War
World War II

Side note: If you were investing during WWII AND are on Twitter, bravo!

5/x

How much research have you done on the stocks you own?

Vs. others' opinions?

Vs. YOLO buys that you love mostly because they're up a lot?

6/x

If the performance of your portfolio was flat or down slightly over the next 10 years, will you have saved enough to still be alright?

To be clear, that means your current nest egg + your ongoing savings rate.

7/x

Have you factored in the possibility of FinTwit groupthink (e.g. so many similarly-constructed, concentrated portfolios heavy in SaaS, e-commerce, etc.)?

8/x

How is your situation likely to change in the next 10 years? Are you set to meet those obligations?

Marriage?
Divorce?
Kids?
Elderly parents?
House?
Desire for more work/life balance?
College payments?
Job loss?
Lower earning potential?
Hedonic treadmill?
Retirement?
Etc...

9/x

If you're a "value investor" that has lagged the market for a decade or more, are any of your fundamental assumptions flawed?

In other words, are you hiding any mistakes/bad logic behind the excuse that the market has rewarded growth?

10/x

Has anything besides your portfolio's value materially changed between March and now?

11/x

If low interest rates are making stocks more attractive vs. bonds, are low mortgage rates and lower opportunity costs for down payments making housing particularly attractive as a diversifier to both stocks and bonds?

12/x

You realize @stoolpresidente is just creating tongue-in-cheek content, right? His effectiveness building a media business is legit, but his daytrading advice?

13/x

Does a single stock make up more than 10% of your portfolio?

If yes, is that due to the stock "earning" it through appreciation or just because you took an outsized bet on it?

14/x

Where are you in relation to your financial goals?

If you're well ahead of schedule or have effectively won, is it possible you're risking "what you have and need for what you don’t have and don’t need?"

15/x

What are your long-term return expectations?

Are they humbly realistic vs. these all-time-great data points?

Lynch returned 29% a year over 13 years.

Buffett has returned 20% a year over half a century.

The market has returned 10% a year over the past century.

16/16