Frequently Asked Questions

The beauty of doing things in community is that you’re not alone.

The world often tells us that investing is best left to the professionals—that we should delegate it to a financial advisor and leave it at that. But if you want to manage your own money and become your own portfolio manager, it’s absolutely doable.

Here are the questions I hear most often from members:

The financial industry loves to make investing sound complicated. If something doesn’t make sense, the problem is not you. The problem is the explanation.

And a healthy fear of the stock market is a good thing. As anyone who has lived through a crash knows, investments can grow steadily for years and then drop precipitously in a matter of months.

A big part of what we’re doing here is managing risk: spreading money across different types of assets, limiting how much goes into any single investment, keeping an eye on the economy, and buying good companies at good prices.

Even so, investing is risky. I can’t guarantee that you won’t lose money.

But doing nothing carries risk, too. Investing well can create more space in your life: more freedom, more choice, and more room to spend your time and energy on what matters most.

My advice? Take things at your own pace. Ask questions. There’s no rush.

If you’ve ever signed up with a financial advisor, they’ve probably asked you to fill out a risk tolerance questionnaire. Are you aggressive? Moderate? Conservative?

Frankly, I don’t think that’s a good starting place.

Here’s how it usually plays out. If you have a conservative risk tolerance, an advisor would invest your money mostly in bonds and cash. If you’re aggressive, an advisor would invest your money mostly in stocks. A heavy stock allocation might make you more money over the long term, but it will likely lose a lot more value in a market downturn than a portfolio of bonds and cash would.

The problem? That approach hinges on your temperament rather than on when you’ll actually need the money.

So instead of a quiz about risk tolerance, I’d start with time horizon, just as you did when you set up your account. Keep your emergency fund and any money you’ll need in the next few years in the bank, not in the stock market. Money you might need soon shouldn’t be riding the market’s ups and downs.

Over time, experience will tell you far more about your risk tolerance than any questionnaire.

It certainly can. Many members work with an advisor. But handing everything off can leave you feeling disconnected from your own money.

If you’re curious, consider opening a small investment account. The gains and losses in that account are unlikely to make or break your overall financial plan. But there’s tremendous power in learning by doing and by watching the markets when you have real money at stake.

People often tell me that placing their own trades helps them understand investing on a much deeper level. And perhaps most importantly, it empowers them to ask sharp questions in those annual meetings with their advisor rather than glazing over and nodding along. (We’ve all been there.)

Nope. I don’t trade often. I typically send no more than one or two trade emails a week, and many weeks there’s not much to do.

The exception is when I think the market is genuinely at risk of a meltdown. In that case, I may send sell emails more often, and you’ll want to act on those sooner rather than later.

Buy emails aren’t urgent. If you see one a day or two (or even a few days) after it goes out, it’s generally fine to place the trade, unless the stock or fund has had a big pop. An easy way to check is to search for the ticker symbol and look at the recent price chart.

Sell emails are a bit more time-sensitive. Get to them as soon as you reasonably can, even if you’re a day or two late.

And the Friday Recap is your weekly reset. It shows what I bought, what I sold, and what’s in the account, so you can get caught up if life got busy.

This shouldn’t take much time or mind space. Your first trade will probably take the longest because everything is new. After a few, it becomes routine. Investing is supposed to create more space in your life, not turn your phone into an emergency siren.

Go! Enjoy it. You’re allowed to take a break.

Because I invest for the long term and don’t trade much, you don’t need to do anything special before you leave. Your investments can sit quietly while you’re away.

When you’re back, check the Friday Recaps and any trade emails to see what you missed. Then pick up wherever you’d like.

From a technical perspective, the math favors investing a lump sum. Markets tend to rise over time, so on average, getting all your money invested sooner wins.

But we’re human.

Let’s say you put your whole position into a stock on Monday, and by Friday it’s down 10%. That feels terrible. It’s a punch in the gut. And that feeling can lead to bad decisions, like selling a perfectly good company at exactly the wrong time.

When I buy in increments, a drop feels completely different. If a stock I like goes down after my first purchase, I get to buy more at a lower price. Instead of panic, there’s a little bit of excitement. It’s a sale!

So I buy in pieces. Not because it’s mathematically optimal, but because it’s so much easier emotionally. And an approach you can actually stick with beats a technically correct approach you abandon at the first sign of trouble.

No. Never.

Rebalancing means selling some of what has gone up and buying more of what has gone down to get back to a target allocation (think of your portfolio as a pie chart). Trimming means selling part of a winner to lock in some profit. Both sound prudent. And both cut against the very thing that builds wealth: compounding.

When I buy a company, my mindset is that of a business owner. I buy it because it’s a good business, run by good people, making good money, at a good price. If it keeps doing what I hoped it would do, I want to keep owning all of it. Selling a piece of a great business just because the stock has gone up is like pulling up your strongest plants because they’ve grown taller than the rest of the garden.

A few winners that compound for years can do the heavy lifting for an entire portfolio. Trimming them caps that upside. And in a taxable account, every sale can also trigger a tax bill.

That doesn’t mean I never sell. I sell when something meaningful changes: the business is no longer healthy, or the economic environment shifts in a way that worries me. But I don’t sell good companies just to make a pie chart look tidy. My target allocation guides where new money goes, not when I sell a winner.

Yes. Always.

Reinvesting your dividends means every dividend payment automatically buys more shares of whatever paid it. Those new shares pay their own dividends, which buy more shares, and so on. That’s compounding in action, and it happens without you lifting a finger.

Here’s how to set it up at most brokerage firms:

The exact menu names vary by firm, so if you can’t find it, search the help section for “dividend reinvestment” or call customer service. It usually takes about five minutes.

One note: in a regular (taxable) brokerage account, you still owe tax on dividends in the year you receive them, even if they’re reinvested. In a retirement account like an IRA or Roth IRA, that’s not an issue.

Maybe. Here’s what it is, so you can decide for yourself.

Fully paid securities lending means you let your brokerage firm lend out shares you own outright (not bought with borrowed money) to other investors. The borrowers are often short sellers, who are betting the stock will go down. In exchange, you earn a lending fee, usually split between you and your brokerage firm.

The pros:

The cons, and how it can go wrong:

How to set it up: most big firms offer a program (for example, Fidelity’s “Fully Paid Lending” program and Schwab’s “Securities Lending Fully Paid Program”). You usually enroll through your account features or by calling the firm. Eligibility rules vary. Many firms require a margin-enabled account and a minimum balance, and many don’t offer it in retirement accounts.

Bottom line: it’s not a bad tool, but it’s not free money either. If you choose to do it, go in with your eyes open.

Not anymore.

Early in my investing career, I played around with options to enter positions and generate extra income. It was a good learning experience. But I found I didn’t have any consistent edge or reliable model for pricing puts and calls.

And selling covered calls, a popular income strategy, caps your upside. If I’ve found a wonderful company that I believe is going to do well, the last thing I want is to agree in advance to sell it at a set price.

So I keep it simple. I don’t trade options. If I don’t have an edge, I don’t play. We don’t have time for needless complexity.

Short answer: no. At least, not as part of my investing strategy.

I firmly believe blockchain technology will be transformative. The ability for two strangers to transact directly, without a bank or other middleman, is a big deal. It makes “trustless” transactions possible.

But believing in the technology is different from investing in the coins.

When I invest, I’m buying a business. I can look at how much money it makes, estimate what it’s worth, and wait to buy it on sale. With coins and tokens traded on public blockchains, like Bitcoin, Ether, and SOL, I have no way to know whether they’re overvalued or undervalued. There are no profits to analyze. So the only way I could trade them is on technicals (price patterns and momentum), not fundamentals.

And while some people have made quick money in crypto, I’m not sure it’s “real” in the way a business is real. A farm grows food. A software company builds tools people pay for. I’m not convinced the coins themselves are solving real-world problems, at least not yet.

In the spirit of full transparency: I do have a little money in a Coinbase account that I futz with based on technicals. But it’s a small sandbox, not a major pillar of my strategy.

Happy to share more if you’d like. Feel free to reach out.

This is a really good question, and I think about it a lot.

When I think about risk, I start by sorting it into four buckets:

Then for any given risk, there are four basic ways to respond:

For the economic risks I can see coming, like a slowdown or recession, I mitigate. I keep an eye on the economic environment, and if I think things are about to get ugly, I sell some of my stocks. That’s my job, and that’s what my sell emails are for.

But catastrophic systemic risks are different. There isn’t a meaningful way to avoid them if you want to invest at all, and there’s really no way to insure against the entire financial system going dark. So for these, I think the only real answer is to accept the risk.

I know that’s not the most comforting answer. But accepting what we can’t control frees up energy for what we can: owning good businesses, buying at good prices, and watching the economy.

If you’ve ever gotten the sense that Wall Street is a little shady, read Michael Lewis’s 2014 book Flash Boys: A Wall Street Revolt.

It tells the story of Brad Katsuyama, a trader at the Royal Bank of Canada whose job was to buy and sell stock for big clients like pension funds. One day in 2009, Brad went to buy a large block of stock, and it was as if the market had stopped working. Normally, if his screen said he could buy, say, Exxon stock at $83.25 per share, he could. But suddenly, the price started jumping higher the moment he hit “buy.” It was as if someone knew what he was about to do before he did it.

Lewis goes on to describe the rise of high-frequency trading, fragmented exchanges, dark pools, and broker kickbacks, all of which allowed some traders to detect investors’ orders and jump ahead of them by fractions of a second. And it wasn’t just big institutions getting hosed. It was everyday investors like you and me.

I have no way to know whether Lewis’s account is fully accurate, or how much of this still goes on today. But I don’t love the idea of a high-frequency trading firm taking advantage of me, even if it’s only by a few pennies per share.

So I do two things to protect myself:

Under normal circumstances, there’s virtually no difference between what you’d get with a market order and a limit order. But the modern stock market is a complex, fragile, computer-based system, and it can experience flash crashes and strange price spikes. If that happens, a limit order gives you an extra layer of protection.

Bottom line: there’s no shame in placing a simple market order and letting your brokerage firm route it wherever it wants. But if you want a little more protection, you can send your order to IEX and use a limit order.

At the most practical level, it’s working if your account is growing over time.

That doesn’t mean every trade, every day, or even every month will be profitable. Markets go up and down. Some investments will work beautifully, and others won’t.

So zoom out. Rather than judging the process by one trade or one bad week, look at your annualized rate of return over longer stretches of time (you can usually find it under the “Performance” tab at your brokerage firm). Because I invest for the long term, I’d give it at least a year, and ideally several, before drawing any big conclusions.

The goal is steady growth over time, ideally without a lot of big drops or drama along the way.

Honestly? Imperfectly. I’m human, and I feel the full spectrum of emotions: fear, doubt, excitement, and the occasional knot in my stomach.

The truth is, the biggest risk to most portfolios isn’t the market. It’s what we do when our emotions take the wheel. So over the years, I’ve developed a handful of emotional rules. They’re my guardrails for the moments when fear or excitement starts trying to make decisions for me.

These rules won’t stop you from ever feeling the fear. But they help keep the fear from making your decisions, so that you can live a life that is more fully your own.