The following was initially published in the Fat Stacks newsletter on March 14, 2020.
Yesterday I read some sound investment advice to the question “what should you do?”:
“Most people should do zip. The bold might trim bonds and nibble equities. The cowboys yesterday were scooping up banks, oils and airlines with both hands.” – Greaterfool.ca
Zip refers to not selling or buying. Invest as you normally do whether it’s monthly contributions, etc.
The cowboys comment made me laugh. No, I’m not a cowboy but I tip my hat to them.
Same applies to niche sites.
Carry on business as usual. While the economy may be in the gutter for a while and traffic lower, it should be business as usual.
Many people after yesterday’s email asked me why traffic is down if more people are at home.
I’m no sage but the question crossed my mind also. Here’s what I think.
First, while more people are working from home, they probably spend more time streaming shows, posting emojis on Facebook and yucking it up on WhatsApp groups. Those sites are likely blocked at work but not at home.
Is anyone really working? Doubtful.
Heck, I spent an hour goofing around on WhatsApp groups yesterday which is rare. I’m sure I’m not alone. And I’m highly motivated to get work done.
My accountant emailed me last night at 11 pm (those poor accountants) saying their entire company is now encouraged to work at home. This is at the height of tax season. That tells you something.
Second, more people are likely devoting more surfing time to news about Corona and the economy. These topics are taking precedence over their usual interests.
I’m reading more about the economy since it’s a perfect storm. The Canadian dollar is falling (good for me), oil is in a nose-down dive (bad for Canada), stocks crashed (bad for most unless you’re a cowboy), interest rates are on a path to zero. On and on it goes.
Again, I’m no sage. That’s my two cents’ worth.
Why am I not a cowboy when it comes to investing?
I pay little attention to individual sectors and companies. I’m the ignorant dude who falls in with the “sucker” group. I’ve lost money buying individual stocks because I don’t pay attention.
One time I bought on a “tip”. The tip was not from a hedge funder who actually knew something. It was from some guy who was studying to be a high school teacher. This was 15 years ago. I’m glad I learned my lesson early when I didn’t have much to lose.
On the flip side, I’ve made great money buying index funds. Of course, I just lost 25% of it, but in the long run it’ll serve me well.
I’ll continue contributing monthly just like I’ll continue publishing new content to my sites daily. Just because site traffic is down doesn’t mean I stop working on them.
While I pay no attention to individual investments, what I do pay attention to is my online business. No index fund or stock has generated for me such a great return on investment as online publishing. It’s my specialty. It’s where I deploy most of my money and time. It offers me the best return.
Yes, I diversify with index funds, but that’s passive.
Maybe one day I’ll set aside some cowboy money but for now I stay prudent and focus on what I know and like best. That’s niche sites and yammering on to you fine folks on the blog and in email newsletters.
Jon runs the place around here. He pontificates about launching and growing online publishing businesses, aka blogs that make a few bucks. His pride and joy is the email newsletter he publishes.
In all seriousness, Jon is the founder and owner of a digital media company that publishes a variety of web properties visited and beloved by millions of readers monthly. Fatstacks is where he shares a glimpse into his digital publishing business.