Pour one out for the TQQQ boys
Remember reading a few posts months ago about going all in on TQQQ as a risky, but most surefire way, to hit mid seven figures NW young and FIRE
RIP
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If you invested 1k a month in TQQQ from 1999 (tech bubble) to 2021 (265k total), that portfolio be worth $12.5 million. These are the times where you buy and thank yourself 10-20 years later. It's not about the short term volatility. It's about the long term. If the long term market trend is up, then there will be more up days than down days and the leverage will amplify returns instead instead of the volatility drag often mentioned. Just DCA that shit. That being said, it's definitely reasonable to wait on the sidelines as TQQQ will inevitably be lower this year. I just hope for another market crash like COVID. TQQQ went from the 8s in March 2020 to 91 in November 2021.
Do you believe the growth in QQQ between 2022 and 2043 will be greater than or less than the growth in QQQ between 2001 and 2022?
Personally, I think it will be less. The top companies are stable blue chips rather than high flying growth stocks.
Own some QQQ and TQQQ as well, I’m just making a point for discussion.
I’m trying to build a basket that fit the criteria of the old QQQ. Less than $1-$50bn market cap but lots of potential. Google and Apple ain’t gonna 10x from here but some of these other mid cap tech companies might
Definitely less but the returns will still be good. Maybe it's not a 20x but a 10x or 5x is in the cards. It also depends on how much you load the boat during down turns. People who bought in March 2020 were handsomely rewarded. Another thing to keep in mind is if certain companies grow in market caps, then QQQ index percentage allocation will also adjust. Those returns will then be reflected in TQQQ. So if there's another Tesla (for ex.) that appears over the next 20 years, its inclusion will drive returns. So you could def see mid caps that grow into in their own and boost QQQ and TQQQ
GS launched an ETF end of last year with this exact goal of getting exposure to the next potential FAANGS in a way. Obviously they chose the worst of times to launch this and it has been getting absolutely crushed as of lately but could provide interesting entry point sometime this year if the sell-off continues. The ticker is GTEK
If you have guaranteed future cash flows as in the thought experiment the risk mostly disappears as you aren't actually 3x leveraged. I'm not sure how you are calculating TQQQ from 1999 (when QQQ was listed) but as QQQ had 80+% drawdown TQQQ would probably be 99ish% drawdown and there is real risk of losing your income source at the same time as your portfolio evaporates. Investing over time also implicitly gives more weight to recent returns as well instead of the huge drawdown in the early 2000s. It's also far from certain that QQQ will continue to significantly outperform global markets.
I don't know what you mean by you aren't actually 3x leverage if you have consistent cash flows. You can use QQQ returns to back test TQQQ. I used the daily returns of QQQ from 1999 to 2021 to map how TQQQ would've performed. TQQQ is just 3x daily return of QQQ. You can try it and see if you come out with something different. Yeah having a consistent stream of money to invest is crucial in this strategy. It would screw you if you lost your job during the stock market crash for sure. I think QQQ and therefore TQQQ will still do well over the next 20 years, but it probably will not be as high returns as these last 10 years. You could also try QLD which is 2x leverage and less risky overall. I'm young so I'm willing to take some risk for high reward or at least die trying. There's obviously risks involved, and the strategy isn't for everyone.
Your analysis for DCA from 1999 seems to end in 2021…I think including 2022 would make sense.
That's fair. I use 2021 because it's a clean start and end of a year (start of 1999 to end of 2021), and that's the last time I went through the process of calculating the shit lol. When I have time, I'll try it for until now. It's probably not a 47x in your money with TQQQ recent decline, but I would wager it's still pretty damn good.
It’s fine, totally fine. I’m still up on my PF2029E base case model
Never liked the idea behind how leveraged ETFs are structured. If you want more leverage on the index, look into the futures market if you have the bankroll, they even have micro contracts now.
Micro E-mini Nasdaq-100 Index Quotes - CME Group
Fed issues leveraged ETF warning | Financial Times (ft.com)
Retail investors taking a punt on futures, what could go wrong?
Push me to the edge, all my stocks are dead
Uzi haha
I think the common sentiment then was that something like this was completely possible, and you should only do it if you're willing to stomach a 90% drawdown. Shouldn't be a super big deal if you planned on holding for the next 10-15+ years
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