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birb_cromble  1mo ago (text post)   1623 thread views

Weekly Finance Thread

Since a lot of us here have expressed interest in not starving to death in a gutter, I figured I'd start a weekly thread to discuss financial matters.

Ground Rules

  • Remember that we're all just Internet randos. Don't bet your life savings on a hot tip from this thread.
  • Keep culture war in the culture war thread. Yes, global events may impact our personal finances, but that does not mean we have to incessantly harp on culture war aspects here. If you are going to discuss it, please stick to the practical impacts of it on an individual level.
  • Be kind. Remember that everyone here comes from different circumstances. We all have different resources available and different risk tolerances.
  • Don't let the perfect be the enemy of the good. Better is better. Celebrate people when they take a step up and work to move their finances in the right direction. Don't flame out because they haven't followed what you consider the optimal path. Everybody has to start somewhere.
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General advice: Investing without a pre-defined risk and a stoploss is like driving without any brakes. Investing 5000 does not mean you are actually risking the 5000. With a stoploss of 10%, and a catastrophic market crash of -10% in a single day, you will be getting out (if you have any sense) with a loss of 500. That, those -10 percent, is your risk. Always pre-define your risk and cut your losses short

That's not at all general advice, that's typically considered a rather bad idea. Unless you're betting on single stocks you're not even that confident in, the market is going to recover from any fluctuations and you want to ride it all the way back up after any drops. General advice is to buy basic index funds and try to minimize how often you even look at them, trusting in the long run returns.

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