The win rate of stocks
🔸 Plus: Inter Milan seized by Oaktree Capital 🔸 Citigroup trader filled in a form wrong and wiped out €300 billion 🔸 Craig Wright's own credit card records show he didn't invent bitcoin 🔸
Your 2-minute guide to demystifying money and making you richer
The markets, year-to-date
S&P 500: 5,307.01 ⬆️ 11.90%
FTSE 100: 8,370.33 ⬆️ 8.44%
Bitcoin: $69,710.40 ⬆️ 57.70%
GBP to USD: $1.2715 ⬇️ 0.097%
GBP to EUR: €1.1730 ⬆️ 1.72%
The win rate of stocks per time held
Ben Carlson, who is an advisor at Ritholtz Wealth Management, published a fantastic chart recently that shows perfectly why Moneyin2 wants you to take control of your financial future and invest in stocks. It shows the “win rate” of the S&P 500 index.
The win rate is the percentage chance that the market goes up over any given time period. The S&P 500 is a list of well-known companies whose shares are often the most commonly traded. Here’s how long you need to hold stocks in order to see a gain:
At the far left you can see that if you buy and sell within a single day, you have a 54% chance of coming out ahead. But if you just hold on, your success rate goes up. After 2 years there’s an 88% chance of being ahead. After 6 years it’s close to a certainty that you will be richer than when you started.
Importantly, this is why day traders lose money while people who buy and hold an S&P 500 tracker or ETF typically come out ahead.
This, by the way, underlines the advice Moneyin2 gave you back in early April. Stocks had just hit a new all-time high. The S&P was up 8.81% for the year. Nice! While the temptation might have been to sell and enjoy your gains, the data shows that all-time highs tend to be followed by … more all-time highs.
As of yesterday, the S&P was up 11.9% for the year! Right on cue, it added another 3%.
Time in the market beats timing the market
And yet British people are mostly sitting on the sidelines:
61% of Brits save money each month.
But only 23% of British adults are invested in stocks.
Yes, investing involves risk. Markets can go down. And when they do, they take your money down with them — and it’s a horrible feeling.
But if you’re patient — there are no get-rich-quick schemes — stocks do this:
And for dessert …
Serie A champions Inter Milan was seized by Oaktree Capital Management after the club’s Chinese owners, Suning, failed to repay a loan worth €395 million. Madness.
A Citigroup trader filled in an order form wrong and briefly wiped €300 billion off European stocks in a flash crash. He meant to create a trade worth $58 million “but accidentally entered that 58 million into the quantity field instead, creating a mammoth $444 billion basket containing 349 stocks from 13 different countries,” Bloomberg reports.
Inflation falls to 2.3%, higher than expected, so the Bank of England is not expected to reduce interest rates — currently 5.25% — anytime soon. That’s bad news for the Tories, who would really have loved a rate cut before the election.
Ivan Boesky, the real-life crooked stock trader who inspired Michael Douglas’s “greed is good” speech in the movie Wall Street, has died. Here’s what Boesky actually said, back in the 80s: “Greed is all right, by the way. I think greed is healthy. You can be greedy and still feel good about yourself.”
The highlights from the court ruling that found Craig Wright was not the mysterious, disappeared inventor of Bitcoin, are hilarious. At one point Wright tried to prove that he bought the bitcoin.org domain in 2008 by showing the court a credit card statement screenshot … from 2018.
The CEO of Santander says he only took the job on the condition that he could work from home. He lives in Harrogate, Yorkshire, and travels to London a few days a week.
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