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Comment by bagacrap

5 days ago

Shorting is really not that straightforward. It is a avery advanced topic because it mandates the use of leverage. Many (most) investors are long-only, especially the ones being taken advantage of here.

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bagacrap

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Retric  5 days ago

> especially the ones being taken advantage of here.

This is a great argument why buying an index is a poor choice for a long term investor. You can avoid a great deal of shenanigans by randomly purchasing stocks and holding them for 50 years. Even a 0.02% annual fee costs you 1% of your long term returns over that timescale.

But there’s tradeoffs to everything.

  • bagacrap  5 days ago

    Index investing is a great choice for a long term investor who cares about simplicity, which should be the vast majority of them. Actually the best thing about holding individual stocks is probably the increased opportunities for TLH, but the nightmare of holding and managing hundreds of securities in your account is very seldom worth what you save on fees or deferred taxes.

    • Retric  5 days ago

      You still owe the taxes on dividends generated by an index fund that automatically reinvests dividends. There’s ways around this like a 401k, but you can also own individual stocks inside a 401k or rollover to an account that lets you do so.

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