patrick.net

I'm not nervous, but on the other hand, I don't know how much exposure to AI stocks I have either.

I know I'm overweight AAPL because once upon a time I rolled the dice and bought some shares, and my funds also own AAPL usually.

However, what is really important to me is taxes; the tax on investments is what really costs money down the road.

For decades I have not made changes to my investments; I never "rebalanced" them as I got older.

The only change I made recently is exchange my International Stock funds for USA stock funds, and I'm selling the one in my taxable account bit by bit; it's my "piggy bank' these days.

Trump is pumping stocks, don’t expect crash anytime soon

stfu says

I'm getting very concerned with the weight of MAG7+Nvidia in my favorite ETF's (IUSG, SCHB). I have a younger relative who codes LLM's for sub prime fintech's in the Bay area and he is adamant that AI is the biggest bubble he's seen in his life (granted he was not investing even as recently as the 2018 pullback).

I've started putting new money into (what I believe to be) a good alternative ETF called DGRO which is more focused on dividend growth (not yield) but still includes a small exposure to MAG7. I'm considering closing or at least severely downsizing my positions in IUSG and SCHB. I'm talking about a major repositioning of as much as 60% of our net worth so it's material to me.
I made this mistake in late 2007/ early 2008 and ended up regretting going conservative and lost out on big returns in 2009 - 2012.

Same boat here - dodged the 2008 clusterfuck but stayed too conservative during the 2011-2013 runup.

I've been following Finster's (from iTulip) blog Financology ever since iTulip's hibernation. He's been talking about the same thing - diversifying stock positions away from the Mag-7 while maintaining one's overall allocation to equities:

https://financology.net/2025/11/26/how-to-survive-a-bubble/

He has several ETF-based model portfolios covering various investment strategies (growth, income, capital preservation, permanent portfolio) for various portfolio sizes:

https://financology.net/model-portfolios/

stfu says

What does the collective wisdom of the board say? Are we nervous yet?

My IRAs (rollover/traditional and Roth) are in a balanced fund arrangement, 50% investment grade bonds and 50% index funds, and I plan on keeping it the same for next 4 years as it has been for the last 5 years.

Generally the conservative rule is X% of savings in stocks whereas X is 105 minus your age.

CNBC’s article (Dec 8, 2025) outlines how financial professionals would invest $1 million depending on risk tolerance, balancing fixed income, dividend stocks, and equities.

https://www.cnbc.com/2025/12/08/where-to-invest-1-million-according-pros-risk-profile-fixed-income-dividends-equities.html

📌 Key Takeaways
• Risk Profile Matters Most
Advisors stress that the right allocation depends on whether the investor is conservative, moderate, or aggressive.
• Conservative Approach (Capital Preservation)
• Heavy emphasis on fixed income (Treasuries, municipal bonds, investment-grade corporate debt).
• Goal: steady income and principal protection.
• Example: 60–70% bonds, 20–30% dividend stocks, minimal growth equities.
• Moderate Approach (Balanced Growth & Income)
• Mix of dividend-paying equities and fixed income.
• Dividend stocks provide cash flow while equities offer growth.
• Example: 40–50% equities, 30–40% bonds, remainder in alternatives (REITs, infrastructure).
• Aggressive Approach (Growth-Oriented)
• Larger allocation to equities, especially growth sectors like tech and healthcare.
• Smaller slice in fixed income for stability.
• Example: 70–80% equities, 10–20% bonds, rest in alternatives or private markets.
• Dividend Stocks as a Core Theme
Across all profiles, dividend-paying companies are highlighted as a way to generate reliable cash flow while still participating in equity growth.
• Alternatives & Diversification
Some advisors recommend real estate, private equity, or infrastructure funds to hedge against inflation and diversify beyond traditional stocks and bonds.

AD says

• Heavy emphasis on fixed income (Treasuries, municipal bonds, investment-grade corporate debt).

Seems that if this is the plan, one would be better off with shopping for high rate insured CDs.

Private equity is bullshit; the essence of investing is mutual funds.

The simple answer seems wrong to those who think "advisers" know some "secrets."

Ask yourself; why are these advisers still working?

"If you're so smart, why aren't you rich?"

Young men aren’t investing in a 401(k) for retirement — they’re banking on bitcoin

https://www.marketwatch.com/story/young-men-arent-investing-in-a-401-k-for-retirement-theyre-banking-on-bitcoin-ead9d58c

summary:

• Shift in retirement planning: A growing number of young men are opting out of 401(k) plans, preferring to invest in Bitcoin as their primary retirement vehicle.
• Distrust of traditional finance: They see 401(k)s and the stock market as outdated or unreliable, believing cryptocurrency offers higher potential returns.
• Generational divide: Older workers tend to stick with employer-sponsored retirement accounts, while younger men are more likely to embrace riskier digital assets.
• Volatility concerns: Experts warn that Bitcoin’s extreme price swings make it a dangerous substitute for stable retirement savings.
• Financial literacy gap: The trend underscores a lack of trust in institutions and a need for better education on balancing risk with long-term financial security.

Following up on my recent posts (and thanks for all that had some input). I sold all of my IUSG today which was a little over 10% of my stonks. I kind of freaked out last week when I checked it's main holdings and it's at 13% for Nvidia.

Even Stalwarts SCHB and VTI are around 7% Nvidia. These two constitute over 50% of my stonks so I still have plenty of exposure to AI.

Waiting for funds to settle and I'll put it in DGRO. No single stock is more than 3.5% of the total and it has big tech but also big pharma and consumer staples.

I may do a large cap energy ETF because I do believe the future is oil, gas, coal, and nuclear. Nobody can convince me that Solar or Wind will ever produce more energy than it costs.

Any idiot can diversify a portfolio.
Diversification is for the know-nothing investor.

-- Charlie Munger

Eric Holder says

Diversification is for the know-nothing investor.

The only person who is not a "no nothing investor" is an insider trader. The rest of us are making out best guesses.