| | | I maintain a watch list of roughly 100 companies, and will trade any of them opportunistically if the right value emerges, but I'm generally more focused on 40-50 of them. Many of these I've held continuously for 5, 10, or even 15 years. (Didn't hold many individual stocks before then, so there are only a few with longer histories.)
I try not to think about the economy and markets over that time frame. I believe there is a really good chance that we will hit a major economic disaster within ten years. That said, I don't see any shelter from the storm. Dollar-denominated bonds are extremely vulnerable, so I'm trying to keep exposure there short. Real estate did well in the 1970s, but the coming crisis has a very different shape. I doubt that Bitcoin will survive the collapse, especially with the recent moves that tie it to the dollar. Maybe physical gold? A kilo of gold could go a long way... It is possible that my focus on strong multinational corporations is the strongest path forward - they are a share of the global economy, and if the entire global economy breaks down then we are screwed no matter how much wealth we have.
The core pillars of our risk management:
(1) Remaining college expenses held in cash (a CD/Treasury ladder and cash-focused 529 plan that will suffice to cover the entire remaining bill).
(2) Fixed income holdings sufficient to meet our core needs for ten years. (Fudging that a little, we're going to need *some* other income unless we wish to live a truly austere lifestyle. But between dividends and continuing earnings, we can likely manage that.)
(3) A dividend stream that is sufficient to meet our core needs today, and which will likely double over the next ten years to a level that is sufficient to all our needs.
(4) Minimal exposure to bubble stocks. Hoping they do well for people, but I don't want to be taken down if/when the bubble pops.
...and I should probably mention...
(5) No debt. No mortgage. A garden that supplies a substantial fraction of our food for six months out of the year. Marketable skills for continuing employment. |
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