How would you invest $500k at 30? | Hacker News Reader

How would you invest $500k at 30?

23 pointsdawhizkid41 comments

I want to more aggressively invest some cash but unsure where to put it.

Do some serious homework on the markets before putting that 500k on the line. Some, but not all, and probably not half of the stocks in the S&P 500 will continue to gain this year. Bonds have run up recently, so they also have more immediate risk of decline / low yield.

Also, consider things not so obvious: option selling strategies. Warren Buffet does it, so smart is as smart does.

Yes, tempting to hold in cash and wait for the market correction - if it ever comes.

The market is fine. There is no recession here. SPY support is $249.57 right now.

Inflation eats cash.

Imagine my surprise this morning when I created a throwaway account to ask HN how I can actively invest $500K, go to the “Ask HN” tab to see how these posts are usually formulated, and someone’s asked almost the exact same question (I’m a couple years younger than 30 and I’m looking at small businesses).

Work or worked at lyft? Haha

VTSAX or VTI: Vanguard Total Stock Market Index.

Serious question: what happens when everyone invests in index funds?

Would appreciate if one can point to research related to this scenario

The logical conclusion seems to be that individual stock picking becomes more attractive (there are overperforming stocks, but the vanguard funds can’t take advantage of it).

This -- you'd expect that actively managed funds would start, on average, to give better performance than the low-cost passive indexes. In the long-run this would likely reach an equilibrium where, on average, results are comparable -- minus fees. We are not there yet. Maybe we never will, because reasons.

The same way everyone should invest 10'000 USD: https://www.youtube.com/watch?v=JcqlCoreWi8&t=12s

If you need the money in short-term (2-3 years), I would split it into 2x250K and just park them in online savings accounts which currently give about 2.25% APY.

If you have a bit longer horizon, I would go for VTI.

Do you have time to watch the market? If you want to go with aggressive growth, and $500K you are willing to risk, then options trading. Put $20K per trade and it should double in a year.

Any suggestions on how to properly learn how to do this?

The easiest way to do it is follow my plans. The harder way to do it is watch the stock market and look into technical analysis. It takes a while but if you start with a small account you can look for an edge and utilize it. It takes a while and you have many losses early on and then over time you narrow it down to what works. I'm not sure if anyone can do it the same way I do but I don't know of a better way to answer your question.

Main items we focus on are price-action and price-volume. In essence, for every minute the price goes up, what's the volume? For every penny the stock goes up, what's the volume? For every 100,000 shares what's the change in price?200k? 300k? 1m? and so on. Also, weighted factors for all the different indicators, MA/SMA/CCI/RSI/VWAP being of most pertinence. Pitch fork trends weighted at a lower level. Also several other proprietary indicators based on stock correlation (i.e. BABA vs AMZN, if AMZN is moving down, BABA should as well because of what it relies on). Sentiment Analysis to look for bad news.

OP - tread carefully, this "advice" is from an individual afflicted with a case of Dunning-Kruger.

:) Some people are meant to be employees and lack the ability to think for themselves. Stay in school.

[BB] The PLAN is to enter the Jun 21 $10.00 Calls if BB crosses above 10.50 if you like

[HD] The PLAN is to enter the Apr 18 $190.00 Calls if HD crosses above 193.00 if you like

[AAPL] The PLAN is to enter the Apr 18 $192.50 Calls if AAPL crosses above 193.00 if you like

For anyone looking at the statistics here.

BB never met the entry point.

HD did 150%.

AAPL is up 60%.

Golden Butterfly portfolio: https://portfoliocharts.com/portfolio/golden-butterfly/

Or some other portfolio among the many options on the site. The nice thing about this site is that you can simulate how your allocation would do historically.

Depends on your event horizon.

If you are planning to invest for retirement, then I would put it into a collection of Growth funds.

If your objective is to get a constant payout, then some dividend based fund.

If you want to throw it away: 1) send to me :) 2) buy a business you think you know but do not really. Everyone thinks they can run a restaurant. It is the winner for failed businesses.

>>> aggressive

BI provides a list of tech IPOs coming down the pike. No need to buy at all once.But a price-action-averaged, market-cap-weighted basket of securities from this pool could achieve 20%+ IRR through 2024

https://www.businessinsider.com/tech-startups-going-public-2...

You can look into investing them in Amazon resellers. you can use a platform like upfund.io, or loan it out to Amazon sellers you know personally, from my experience investors can expect 40%+ annual returns. This is because the FBA business models can yield 200%+ yearly ROI for the resellers themselves.

Aren't signups closed on upfund?

not sure, I am a seller using their services, not an investor. Are you not able to invest in new deals?

I'd look for an industrial warehouse in the Midwest with strong credit tenants and long-terms leases (e.g. like a publicly traded company serving a utility function).

You'd have to start with a small property, given your capital. But returns are stable and can be relatively high -- 9-15%.

In general, invest in things with higher returns and lower risk. They're not necessarily correlated.

Things which you understand better than anyone, that you believe in but others don't.

FZROX or VTSAX. Perhaps not in a lump sum right now, but that amount divided into weekly deposits to mitigate risk a bit.

Why would weekly deposits mitigate risk?

I read somewhere they used previous outcomes to simulate lump sum investments at the start, and weekly/monthly deposits.

End result wasn't that much different - the lump sum did do better, but not significantly. The weekly/monthly deposits was smoother.

icedchai summed it above but the reason for this isn't to maximize return - it's psychological. If the market drops, you now can buy more at a cheaper price. If you spent it all, you probably would be tempted to cash it all out to cut your losses. of course, you shouldn't, but we're talking about our lizard brains here.

The strategy is called dollar cost averaging: https://en.wikipedia.org/wiki/Dollar_cost_averaging

It’s mostly psychological. You dump 500k in and the market drops 10% next month, you’ll feel like crap. If you’re DCAing in you can put more in and feel like you’re taking advantage of the discount. Long term it doesn’t matter much.

I would buy some blighted properties in West Baltimore, fix them up, then rent it out through AirBnB.

Donate at least 100$ to Greenpeace.

What’s your unfair advantage? What do you know that most people don’t? Rhetorical questions of course!

make sure to watch this

> https://www.youtube.com/watch?v=tCc1n90ntWk

Buy Decentraland

wait 8 years ... x100 return?

sounds like a joke, and it kind of is, but I did it myself with 10k. With $500k you're going to fluctuate $10k everyday anyway. You never know.

buy shitcoins.

Which ones?

shitty ones.

decentraland

What is your horizon? Can you afford to lose a big chunk of it? No risk, no return..

If you have a long horizon (>15 years), invest part in crypto, part in index trackers, maybe take a few small angel investment stakes and some REIT.

Shorter horizon but still want to do aggressive? The half in Crypto, and several early stage companies and keep a half in cash or bonds.

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