Are long-term investments in brokers more profitable than day trading?

[ericwalanta]

[Anonymous]

"Time in the markets beats timing the market". - Ken Fisher

I have 26 years of investing and over 4 years. of active stock trading speaking for me. If you're able to pull off day trading then good for you. I contend anyone that does it it's only a matter of time before they lose. I had a friend that got me into ACTIVE trading. He day traded and was successful for a short time. I'm still trading/investing. He's largely stopped. Now he kind of copies me.

I'm smart enough to know i'm not that smart. I mostly copy those i consider much smarter than me. I'm not getting rich, but i don't need to be. I'm on pace to hit a million in 4 to 6 years and that's just ducky with me. Because it ain't about an ungodly big number. It's about consistent returns that fund a lifestyle. As Charlie Munger said making that, "the first 100k is the slowest and hardest part of building wealth, but you have to do it." It kind of shows his slow approach to investing. Because after that it builds for you. Warren Buffet said, "if you don't find a way to make money while you sleep you'll work till the day you die. And that's how i view investing. It's like a second job that you don't have to spend much time at. This year i hit another milestone. This is the first year i had a 6 figure return. And i did that by early May. It's pulled back a little since. Right now i'm hovering around the 100k mark for the year. But that still more than i make at my job. For the past 5 years i've made more trading and investing than i have at my job. And believe me, the retirement bug has been biting me hard as of late. I'd really like to retire. But these next 10 years. Will be critical for my portfolios growth. And most of my money is in my retirement plan. And the only way to get at it (that i know of) is a 72t. Given the parameters of withdrawal it's incurring too big of a risk to use. So for now i'll keep working.

I'm no expert on this stuff. I joke that i've made just about every mistake a guy can make. The worst one cost me 200k over the past 16 years. I still kick myself for that. But i still contend it was the right move. It just didn't turn out that way. Welcome to investing.

So if you have any questions i'll share whatever i've learned. I don't think you'll learn much more if any more than you can get from a book though from me.

[ericwalanta]

I really respect the approach you’re taking. Consistency, patience, and letting compounding work over time are exactly what long-term investing should be about. And the fact that you’ve already reached six-figure annual returns shows that you’ve built a strategy that is working well for you... That said, I’d still encourage you to take a look at my investment approach not because I’m suggesting you abandon what you’re doing, but because it may offer another opportunity to complement your existing portfolio. If the objective is to build wealth while maintaining your lifestyle and eventually creating more financial freedom, it makes sense to compare different strategies rather than rely on just one. I’d be happy to show you how it works, the potential returns, the risks, fees, and the conditions involved. You can then judge for yourself whether it deserves a place alongside your current investments. No pressure, just an opportunity to evaluate another option based on the numbers and the actual structure.

[OneViewpoint]

Day trading is high risk and time intensive. Also dangerous for people who don't know what they don't know.

I don't know what you mean by "investing in brokers". It makes no sense. You invest in equities or debt instruments or commodities and a broker is simply a person licensed to trade in those instruments since the process is controlled and regulated. You can't just buy stocks like you're going shopping at Walmart. The broker charges a fee for their services.

A full service broker may help you design an investment strategy (at a higher fee). As well as executing transactions at your direction. But brokers may have a conflict of interest and there's plenty of history of brokers "pushing" a certain stock that will benefit themselves and maybe or maybe not their clients.

Under US tax law, a better hands off strategy is to invest in a fund or several funds managed by a full time team of professionals who specialize in corporate debt, tech equities, mega cap equities, middle market equities, precious metals, oil & gas, or agricultural commodities. The fund managers also get a fee for managing the trades. And the fess can vary widely from fun to fund. And typically the fund managers are invested alongside their clients to preclude the sort of thing that can happen with a broker. But the real kicker is that if the investment is held in an IRA or 401K, any trades the fund manager does are not subject to any tax liability. The client only incurs tax liability when they withdraw their money from the fund. So the fund manager can rebalance the fund constantly with no tax considerations.

[ericwalanta]

You’re absolutely right that professionally managed funds can provide a more hands-off approach, particularly when the fund’s strategy, fees, risk profile, and tax structure are properly understood. Your point about retirement accounts is also important, although the exact tax treatment depends on the type of IRA or 401(k) and the applicable IRS rules. This is the kind of investment structure and portfolio management I focus on. I take a disciplined approach to diversification, risk management, asset allocation, and identifying opportunities across different sectors rather than relying on a single market.

[Masie]

I am definitely not qualified to tell you one way or the other, so this is purely a guess. I would say that long term is better than being a day trader.

Again, purely a guess but I think that day stuff would be way more volatile. Tradeoff is slower growth since long term will take time but be safer.

[ericwalanta]

Are you into stocks or mining?

[Masie]

No. The place i work at has a 401k that I put a small amount into, but it is just a simmer job and there isn't much in there.

I am still a student, so I contribute little to the mutual funds that the 401k invests in.

[docster]

A late uncle of mine put he and his wife in the Poor House by day trading.

[ericwalanta]

Brokers are the best. Telling from experience

[Anonymous]

Yes.