Weāre big fans of indexing & weāve explained the benefits lots of times. We also want to give people a choice of investing in individual companies too, which they may choose to do because they believe in the companyās prospects / like their brand or for all sorts of other reasons. So I think that itās overly simplistic to brand investing in individual stocks as āvery dangerousā.
In the future, weāll also add more tools to the app to enable users to see how well diversified their portfolio is, compare it with benchmarks etc. to help give people the information that they need in order to avoid taking too much risk.
In the meantime weāve created a whole series of posts explaining the principles of investing, you can see them in our Introductory wiki š£.
As you say, the question to ask is whether I can identify and exploit that mispricing. My feeling is that for the vast majority of retail investors (including me), the stock market should be considered simultaneously pretty efficient (from my point of view the stock market participants are LeBrons, OāSullivans and Williamses) and random (I have no special insight into why prices are changing or what direction theyāll go).
If I buy Twilio (or Freetrade) and it goes up, have I been smart or lucky? Honestly, I canāt tell.
Do you want to know what I really like about what you just said? Itās a rethorical question. Iāll tell you anyway: it seems to me you are well aware of the borders of your circle of competence and you navigate the waters within those borders.
Do you want to know a secret? Another rethorical question. In the realm of principle it seems to me youāre doing exactly what Warren Buffet does: staying within your circle of competence. And as long as you stay there the chances are you will succeed. And I hope you do. Specially with your Freetrade investment
From 2004 to 2013, he and his wife lived on one income while essentially stashing away the other.
Thatās the secret right there, end of. Itās no different from articles about young people whoāve managed to save and buy a house - 99% of the time the secret is a parent helped them (either directly, by giving money; or indirectly, by letting them live rent-free), or they got an inheritance.
And the thing that connects all of these is, theyāre no reproducable lessons that people wanting to do the same thing can learn from. Donāt have a partner? You canāt do it. Have a partner but you canāt live off one salary alone? You canāt do it. Parents donāt want to help you/canāt help you? You canāt do it.
I mean, Iām glad for this guy that he got to achieve his goal, but he lucked out having a partner who bought in to what he wanted to do.
I think there are lessons to be learned - people donāt have to do exactly the same thing, but they can do something similar, apply ideas which will work for their situation.
That could be retiring not at 33 like Justin did but later, eg 40s or 50s, but still far earlier than normal retirement age of mid/late 60s.
Not got a partner? Thereās always the option to look for one!
That said, some can do it alone - the blogger of Fire the 9 to 5 is one example - enjoying FIRE now in her mid-40s, single parent with two kids:
