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Investment Strategy I developed the following strategies:
- NASDAQ 100
This portfolio selects 5 stocks out of 100 stocks that are part of the NASDAQ 100 index. Stocks are
selected based on market conditions. This portfolio gets stellar performance but with it comes high
volatility. It considerably outperforms the NASDAQ 100 index (the benchmark for this portfolio)
over long periods.
- Leveraged ETF
This portfolio consists of 2 leveraged ETFs (Exchange Traded Funds). This portfolio also gets
stellar performance and comes with high volatility. It considerably outperforms the S&P 500 index
(the benchmark for this portfolio) over long periods.
- Active Vanguard
This portfolio selects 2 funds from 14 Vanguard funds that do not contain bond holdings. The 2
funds are selected based on market conditions. It's much more conservative (less volatile) than the
NASDAQ 100 or leveraged ETF portfolio but it still gets very decent gains and considerably outperforms
the S&P 500 (the benchmark for this portfolio) over long periods.
- Vanguard Select
This portfolio selects 2 funds from 5 Vanguard funds that do not contain bond holdings. The 2
funds are selected based on market conditions. It's much more conservative (less volatile) than the
NASDAQ 100 or leveraged ETF portfolio but it still gets very decent gains and considerably outperforms
the S&P 500 (the benchmark for this portfolio) over long periods.
- Simple Vanguard
This portfolio switches between 2 funds available through Vanguard depending on market conditions.
It's a bit simpler than the Active Vanguard portfolio but it still gets very decent gains and considerably
outperforms the S&P 500 (the benchmark for this portfolio) over long periods.
- Lazy Vanguard
This portfolio puts equal amounts in 4 funds available through Vanguard and rebalances once a year.
You'll only have to trade (rebalance) oce a year but it still gets very decent gains and considerably
outperforms the S&P 500 (the benchmark for this portfolio) over long periods.
- TSP
This portfolio cswitches between 2 funds available through TSP (Thrift Savings Plan, a defined contribution plan for
United States civil service employees). It's much more conservative (less volatile) than the NASDAQ 100 or leveraged ETF
portfolio but it still gets very decent gains and considerably outperforms the S&P 500 (the benchmark for this
portfolio) over long periods.
These strategies are very similar. The main difference is that the first one invests
in individual stocks, the second one invests in ETFs and the others invest in mutual funds. Investing in individual
stocks tends to be much more risky than investing in ETFs or mutual funds since ETFs and mutual funds
hold many stocks/bonds. The risk of investing in individual stocks is substantially reduced by investing
in 5 stocks. Investing in more than 5 stocks or more than 2 mutual funds reduces long term gains without much
reduction in risk (volatility).
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