Back in March Burry had a post on RMDs. His conclusion was that the dollar amount of RMDs would be greater than the contributions into plans by the end of this decade.
Yeah, the RMD is based on the value of the account, so the more momentum drives the accounts up, the bigger the RMDs will get. That momentum might work in reverse on the way down.
Your insights into the massive shift toward index investing and the structural dangers it might introduce down the road are incredibly thought-provoking. I appreciate the great read.
Love this analysis! It’s a clear example of how markets can be efficient while creating opportunities for discerning quality investors to earn high returns. For example the unemotional sale of great businesses to buy bonds (an inferior investment) just to meet a target date allocation puts downward pressure on stock prices. This sets up an environment where great businesses can be had at a fair or perhaps even a bargain price.
The last day or two we've seen pretty big moves up on a lot of our portfolio stocks as well on no news. Seems to be a bit of a rotation out of pure speculation into more quality and defensive names.
Great article on how market fluctuations are being driven by passive investors who aren’t looking at the fundamentals. Prices are falling and rising because of ETFs, 401k construction and retirement withdrawals rather than being influenced by investors who aren’t looking doing the homework to find great businesses to own, thanks for sharing your insights!
Back in March Burry had a post on RMDs. His conclusion was that the dollar amount of RMDs would be greater than the contributions into plans by the end of this decade.
Yeah, the RMD is based on the value of the account, so the more momentum drives the accounts up, the bigger the RMDs will get. That momentum might work in reverse on the way down.
Great post, TJ!
Your insights into the massive shift toward index investing and the structural dangers it might introduce down the road are incredibly thought-provoking. I appreciate the great read.
Glad you enjoyed it!
Love this analysis! It’s a clear example of how markets can be efficient while creating opportunities for discerning quality investors to earn high returns. For example the unemotional sale of great businesses to buy bonds (an inferior investment) just to meet a target date allocation puts downward pressure on stock prices. This sets up an environment where great businesses can be had at a fair or perhaps even a bargain price.
It does, it will just require a lot of patience while you hold them and they underperform :)
Today was a great day for the patient investor. 1/2 my holdings are in patient investor stocks and more than offset the pull back on my semi holdings
The last day or two we've seen pretty big moves up on a lot of our portfolio stocks as well on no news. Seems to be a bit of a rotation out of pure speculation into more quality and defensive names.
Great article on how market fluctuations are being driven by passive investors who aren’t looking at the fundamentals. Prices are falling and rising because of ETFs, 401k construction and retirement withdrawals rather than being influenced by investors who aren’t looking doing the homework to find great businesses to own, thanks for sharing your insights!
good