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View Poll Results: How much would I venture to invest?
None - it is too risky enterprise 4 5.97%
Few thousand CHF - low exposure to risk 9 13.43%
Several ten thousands CHF - medium exposure to risk 21 31.34%
Several hundred thousand CHF - high exposure to risk 15 22.39%
Above the million CHF - no risk averse 11 16.42%
None of your business 7 10.45%
Voters: 67. You may not vote on this poll

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  #1  
Old 10.01.2021, 18:14
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How much you are able to invest in stock market?

After reading an inspiring thread on topic of investments in:

https://www.englishforum.ch/3245173-post1.html,

it begs many questions of market psychology and individual’s ability of coping with gains and losses. I read that some people on the EF, are willing to invest several hundreds of thousands CHF in the stocks, others like myself would be more comfortable with much lower numbers in the neighborhood of ten thousands. There are also folks who wouldn’t take unnecessary risk and either leave it in hands of professional financial advisors or move to less risky products. Overall, everyone has one’s own limits and adjusts portfolio values accordingly.

Therefore, it would be interesting to make a panel to know of how much you would really be able to invest and what is your main objective and why you think it makes sense?

Disclaimer. Please do not get me wrong. The poll is absolutely anonymous. It’s not intended to share one’s exact financial situation and affordability. It’s about one’s motivation, courage, resilience, ability to stomach the losses and investment sanity.
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Last edited by jacek; 10.01.2021 at 19:03.
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  #2  
Old 10.01.2021, 18:32
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Re: How much you are able to invest in stock market?

Correction: The third choice should read:

Several ten thousands CHF

Mods: Not sure how to correct it after submitting the poll?
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  #3  
Old 10.01.2021, 18:41
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Re: How much you are able to invest in stock market?

Changed it for you
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  #4  
Old 10.01.2021, 18:46
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Re: How much you are able to invest in stock market?

Wouldn't it make more sense to ask which share of your available finances would you invest in stocks?
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Old 10.01.2021, 18:51
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Re: How much you are able to invest in stock market?

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Wouldn't it make more sense to ask which share of your available finances would you invest in stocks?
Thought about it as much but there are also folks who do not mind bragging about numbers.
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Old 10.01.2021, 18:54
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Re: How much you are able to invest in stock market?

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Thought about it as much but there are also folks who do not mind bragging about numbers.
True.

>1 MCHF for me then.
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Old 11.01.2021, 16:13
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Re: How much you are able to invest in stock market?

Stocks are riskier than alternatives only on average. It's just a vehicle. If you buy a real estate holding company (at book value), the risk is arguably smaller than investing in real estate directly.
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  #8  
Old 11.01.2021, 16:55
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Re: How much you are able to invest in stock market?

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Stocks are riskier than alternatives only on average. It's just a vehicle. If you buy a real estate holding company (at book value), the risk is arguably smaller than investing in real estate directly.
Rea Estate can be very risky as well depending on the location. It is also difficult to get out of a bad RE deal.
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  #9  
Old 11.01.2021, 17:03
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Re: How much you are able to invest in stock market?

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Stocks are riskier than alternatives only on average. It's just a vehicle. If you buy a real estate holding company (at book value), the risk is arguably smaller than investing in real estate directly.
Real estate is usually funded with Bank loans, so it's a geared investment & subsequently fairly high risk. The return without gearing is poor.
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Old 11.01.2021, 18:28
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Re: How much you are able to invest in stock market?

Right now I have almost everything in stocks(equity) and property.

I am a rather messy investor. I started in my 20s buying small amounts of funds, but sold it all to buy my first property. 17 years later I am living in a property which I could never have afforded if I didn't sell that first property for double the price I paid for it. Plus now I also have a holiday apartment in the mountains (these are mortgaged at 60% and 40% respectively).

In the mean time, I very slowly rebuilt my investment portfolio, I could have invested a lot more I suppose, but I guess I just enjoy spending money too much , and I wanted to keep at least 3 months of salary in cash. This was until March 2020 when I used up all my cash and bought Fundsmith, SSON, VOO, QQQ and SMT, and have continued to put in everything I have left at the end of the month into Fundsmith (I will reduce this as of this month). On paper, my stock holdings went from low 5 figures in Jan 2020 to 6 figures today, but I have almost zero spare cash. I worry all the time now about when I need to get out of the market and make some cash available, so this morning I put in "stop loss" orders on SMT and QQQ, so hopefully I can sleep better. I will keep the Terry Smith stuff for the long term.

As I said I am rather messy. I do not know how to count my property investment as part of the portfolio. Do I count the market value minus the mortgage? Or my initial investment? I'm too scared to find out that I have too much weight on property in my portfolio (which I definitely do). But hey I love the place I live in and I love my holiday apartment...
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Old 11.01.2021, 19:13
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Re: How much you are able to invest in stock market?

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Right now I have almost everything in stocks(equity) and property.

I am a rather messy investor. I started in my 20s buying small amounts of funds, but sold it all to buy my first property. 17 years later I am living in a property which I could never have afforded if I didn't sell that first property for double the price I paid for it. Plus now I also have a holiday apartment in the mountains (these are mortgaged at 60% and 40% respectively).

In the mean time, I very slowly rebuilt my investment portfolio, I could have invested a lot more I suppose, but I guess I just enjoy spending money too much , and I wanted to keep at least 3 months of salary in cash. This was until March 2020 when I used up all my cash and bought Fundsmith, SSON, VOO, QQQ and SMT, and have continued to put in everything I have left at the end of the month into Fundsmith (I will reduce this as of this month). On paper, my stock holdings went from low 5 figures in Jan 2020 to 6 figures today, but I have almost zero spare cash. I worry all the time now about when I need to get out of the market and make some cash available, so this morning I put in "stop loss" orders on SMT and QQQ, so hopefully I can sleep better. I will keep the Terry Smith stuff for the long term.

As I said I am rather messy. I do not know how to count my property investment as part of the portfolio. Do I count the market value minus the mortgage? Or my initial investment? I'm too scared to find out that I have too much weight on property in my portfolio (which I definitely do). But hey I love the place I live in and I love my holiday apartment...
There is a huge danger with stop loss's, they may never trigger, the price could fall from 12 to 6 very quickly, a stop loss of 11 may well never execute as it requires a willing buyer at 11 than may never occur.
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Old 11.01.2021, 19:42
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Re: How much you are able to invest in stock market?

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There is a huge danger with stop loss's, they may never trigger, the price could fall from 12 to 6 very quickly, a stop loss of 11 may well never execute as it requires a willing buyer at 11 than may never occur.
Yup. There's a big misconception with stop loss/limit orders: many believe that they limit your downside to the level you set. But as you say, you could have a gap down and realise a loss far greater than you intended.

I never use stop losses as they potentially crystallise volatility into losses.
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Old 11.01.2021, 18:35
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Re: How much you are able to invest in stock market?

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Real estate is usually funded with Bank loans, so it's a geared investment & subsequently fairly high risk. The return without gearing is poor.
As far as I can see, the return on REITs is usually negative
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Old 12.01.2021, 14:20
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Re: How much you are able to invest in stock market?

The difficulty I have with this poll is that the options assume that low investment amount equals exposure to risk, and the higher the investment amount, the greater the exposure risk.

And yet, in a diversified asset allocation, the exposure to risk could be reduced when the investment amount is greater.
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Old 12.01.2021, 14:31
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Re: How much you are able to invest in stock market?

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The difficulty I have with this poll is that the options assume that low investment amount equals exposure to risk, and the higher the investment amount, the greater the exposure risk.

And yet, in a diversified asset allocation, the exposure to risk could be reduced when the investment amount is greater.
Of course. Understood. Please select option that reflects your current situation better and our top management will get back to you ASAP. (Sounds very Swiss )

P.S. For instance ... What level of Risk? Hell, I am very resilient and have no problem with it

On the serious note though, I agree that higher capital put in play on the market will result with higher gains in bull market but also higher losses in the bear market. Over the time though it’s assumed that the stocks will increase their value.

What I meant though is, for a typical household you remove certain amount of disposable income that you may part with for certain or indefinite duration of time. So there is always the risk that you don’t have access to it in unpredictable case of e.g. job loss, sudden unexpected expenses, pandemic, economic crash ... and whatever calamity occurs for that matter that will force you to use the money that initially were not planned.
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Old 12.01.2021, 22:18
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Re: How much you are able to invest in stock market?

I leave 1 month worth of expenses as cash and the rest goes to equities. If real emergency* hits, I don't care if timing is not perfect, I'll sell some and get cash back. Otherwise, it is accumulating and the more further I am away from day 0, market crash seems not that worrying.

Does it sound risky?

*New car is not emergency

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Of course. Understood. Please select option that reflects your current situation better and our top management will get back to you ASAP. (Sounds very Swiss )

P.S. For instance ... What level of Risk? Hell, I am very resilient and have no problem with it

On the serious note though, I agree that higher capital put in play on the market will result with higher gains in bull market but also higher losses in the bear market. Over the time though itís assumed that the stocks will increase their value.

What I meant though is, for a typical household you remove certain amount of disposable income that you may part with for certain or indefinite duration of time. So there is always the risk that you donít have access to it in unpredictable case of e.g. job loss, sudden unexpected expenses, pandemic, economic crash ... and whatever calamity occurs for that matter that will force you to use the money that initially were not planned.
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Old 12.01.2021, 22:31
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Re: How much you are able to invest in stock market?

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I leave 1 month worth of expenses as cash and the rest goes to equities. If real emergency* hits, I don't care if timing is not perfect, I'll sell some and get cash back. Otherwise, it is accumulating and the more further I am away from day 0, market crash seems not that worrying.

Does it sound risky?

*New car is not emergency
I leave about 1000 CHF more than I need each month. I can sell funds with no charge and get the money within a few days if need be.
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Old 12.01.2021, 22:53
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Re: How much you are able to invest in stock market?

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Does it sound risky?
On "average" - yes.
But we all have different tolerance - to each their own.

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I leave about 1000 CHF more than I need each month. I can sell funds with no charge and get the money within a few days if need be.
At a potential (large) loss...
There could be other "better" ways to cover further "emergency" expenses (e.g. via credit card etc.)

I prefer keeping a certain cash buffer - which can serve both as the EF as well as dry powder if a sudden drop(portunity) hits.
Don't mind the slight opportunity cost for that potential benefit.

Last edited by gipfelisturmer; 12.01.2021 at 23:12.
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