re: piracy: I just released my latest Leanpub book (Haskell Tutorial and Cookbook) 2 weeks ago, and I put a Creative Commons 'share with attribution, no modifications, no commercial reuse' license, and I explicitly tell people that it is legal to share the PDF, ePub, and Mobi files with their friends, and they have my best wishes if they do so.
I have written a number of books and the payout in increased networking with people who are into the same tech as I am, increased consulting business, etc. is awesome. I also make decent passive income from writing, but that is a secondary objective.
I think you're using the actual definition of passive income (make an investment, don't do anything else other than wait), whereas everyone else seems to be talking about fake-passive income, such as lifestyle businesses they pretend not to work on. (But really do.)
None of them have made a lot of money, but one is still generating a small amount. Guess which. Hint: Income is not proportional with the shinyness of the technology stack
ZoneWatcher - Side project of mine to monitor your/your clients' DNS services and alert when a change to a zone has been made. It serves as a revision history & alerting system which has been helpful when a client fucks with their DNS and expects you to put Humpty Dumpty back together quickly.
I launched it a few months ago and have a few smaller subscribers with a handful of larger subscribers.
I co-wrote a book on user acquisition and co-created an accompanying video course to climb out of debt left over from a failed startup.
Made $104,000 in revenue since June (turns out the user acquisition stuff actually works), about 87k of which is profit, so we'll say ~$11,000/month part-time. It still makes me a solid $2,000/month now with zero work, and hopefully more once the book is officially published. (It's done and delivered to backers, but won't be on bookshelves and Amazon until after it's typeset.)
What part of "$103,892 USD total funds raised" on the provided link was difficult to parse?
And why assume the other is lying? This Ask HN is specifically about passive income, and calls for people to share their profits. It's not about them posting their IRS returns or other proof. If you're gonna doubt them, might as well skip the whole post.
It is the same crap Tim Ferriss is doing. People like the idea, think they can use it as well only to never understand that they are a part of a pyramid scheme which is ultra flat and has only him or someone like Tim Ferriss on top.
If it's ultra flat then it's not a pyramid scheme. It's only a pyramid scheme if it trickles down to ever diminishing returns.
At worse, what you describe is a snake oil sale.
But people can genuinely learn things from this or from Tim Ferris work too, so it's more like any self-help book/product sale basically. As long as it contains useful stuff that the buyer didn't know before on their own, it's legit for me.
Of course if the content is good, it still relies on the determination of those applying it. And some luck besides.
I'm going to assume from your reply that you've just not heard the term before but passive income refers to income from something where you do the work up front and it continues to pay down the road.
I'm trying to work out what would count as passive enough to satisfy the grandparent commenter, if writing a book doesn't qualify. Maybe inheritance? Even robbing a bank requires some upfront effort, so it's hardly passive.
A new book is not a perfect example of that, it's a shitload of work - very likely more work per dollar earned than a day job. Passive income is related to using capital rather than effort to generate money. If the IP of the book was passed down to his kids and they continued to make money off it, or enough money was made from it to surpass a regular working wage for the hours spent, maybe then it becomes "passive". Right now it's just a lot of underpaid effort on credit.
You are correct that it is not passive income in traditional sense, but in HN, "the passive income" has come to mean something that generates automatic revenue after the initial work without requiring significant maintenance/upkeep work.
The prime example of passive income used here is patio11's Bingo Card Creator.
One also could say that in traditional investing, the upfront work is the research work to find right index funds or buying property in real estate investing. They might be less work than writing a book, but revenues e.g. from passive index fund investing are also significantly less than from writing a book, if your starting capital is small.
> One also could say that in traditional investing, the upfront work is the research work to find right index funds or buying property in real estate investing
This is the key point. In absolutes there is no such thing as passive income. Anything will take at least 1s of effort, and $0.001 of capital. The spirit of the term, is income that is heavily skewed towards being generated from assets rather than effort.
A new book is the edge case. While making money off IP is generally the perfect example of passive income. Quitting a job to become an author, is not. There is an implied lack of effort and cost in the question. Additionally, and importantly, there needs to be a sense of "free" in there.
The prototypical case:
- [bust your ass at work] >> [get evened out with paycheck] >> ["free!" passive income from savings]
New book case:
- [bust your ass writing] >> [nothing, world still owes you] >> ["free?" passive income from book IP]
Until the "nothing" gets filled in with the equivalent of a salaried wage, I'm not a fan of calling it "passive income".
> Until the "nothing" gets filled in with the equivalent of a salaried wage, I'm not a fan of calling it "passive income".
Would you also consider creating a static "how to" site that generates revenue from ads to not be passive income? I think that's the most basic example of what HN considers passive.
I think it depends where you are in the cycle. If you just finished putting in 50hrs of work, and have so far made $100, I wouldn't consider that true passive income. Fast-forward a year, and your income from the site has surpassed $2500 (the equivalent of your salaried wage for those hours), with minimal additional effort - now you are making passive income.
We're just defining words here anyway. I think a core component of what people think of when they think "passive income" is making a disproportional amount of income relative to effort put in. Until those proportions get dis'ed, you're just working at a sub-optimal job.
Yes, and not only is it not passive, but you actually have to say something interesting, which means you have to have some business knowledge in some field. And even then, it actually makes money only if it works. Which is rare, probably more rare than a successful startup depending on the specific domain you are writing about.
Vincent Dignan, one of the worst twitter spammer I've ever blocked (more than once since he likes/liked to ignore complaints, open a new account and do it again...to the same people!).
If spamming all of twitter in alphabetical order is an example of the growth hacks....
I see the account he used to do most of the spamming has been suspended by Twitter now https://twitter.com/vdignan
> I agree it's lame but gotta pay the bills :)
reply.
Yep. And like Floyd Mayweather said, "Skills pay the Bills." Like it or not, Mr Vincent Dugnan is very skilled at making 11,000 / month spamming on twitter and social networks. So that's that.
Grasswire? I used to go there sometimes (found it through your blog posts), and being in a similar space I'd agree that the news/article traffic is extremely tough to monetize. We've since slightly pivoted and are confident we're on the right track now. I'm also glad you found your thing!
Can you answer me a quick question? I notice you use the Twitter widget/embed on Grasswire. How do you like it?
I've always felt it was kind of redundant to show the same content that's already on the site. The reason why I'm asking is because while doing my "due diligence" about blogging/bloggers (our target market after the pivot), I've noticed that a solid 10-15% of all blogs use it (or a similar widget from Pinterest or FB). I can see how they CAN be useful, but the fact that they are mostly "consumption only" and mostly curated by one person, means that there is a lot of room to improve them, which is exactly what we're trying to do with our community platform. I'd love to partner up/work together and join forces in some way. Let me know!
Honestly Grasswire is now entirely open sourced/crowdsourced and I haven't touched it in the past ~year or so, so I haven't really been involved in that decision making process and don't have a strong opinion.
I don't really run Grasswire, it's kind of an open collective community, so you can convince people to participate but we can't really "partner" with anyone easily.
Not directly, but the main method of driving revenue was giving away the first few chapters. We know almost exactly how many sales we'll drive based on how many people read those chapters.
Unfortunately not 2016, but two years ago when the Samsung Gear Watch came out a friend of mine got it right away. We went out drinking the same day and when we came back at night we put together a watch face while still being drunk. We uploaded it, set the lowest possible price 1$, and... Nothing happened. Everywhere in the admin panel it showed 0. 0 downloads, not a single dime earned, even after a few days. We were devastated.
But than I found another tab in the utterly shitty admin panel and it hit me like a rock. The numbers on the dashboard were a monthly overview and in fact we earned already hundreds of dollars and downloads in just a few days. I went back to the computer, but together an even better watch face, set it to 1$ again and watched it selling like hotcakes.
However it tried out quite quickly after that. People started to copy stuff and giving it away for free and I never bought the watch myself, I just used the emulator to test my apps. So I took them out of the store at the end because dealing with taxes and sharing the income does not make it worth it if you get support requests like "how can I change the time on my watch", "what do I care, its your shitty watch and Samsung's shitty interface"...
So yea. That's my best story about unexpected passive income. Selling stuff fast on a new platform seem to work!
A few thousand over the course of a few months. The first three months were working out really good. But than it dropped to a fifth of the previous month and it went downhill from there. Anyway. It was still worth it. What took most of my time was setting up the store pages. (Which I couldn't look up by myself because I didn't own the device so I could not access the store at all. I didn't know the ratings on my apps either. Or the ranking in the store.)
You created an apps in a few hours while drunk, set the price to the lowest possible, and when you thought you had no sale after a few days, you were "devastated"?
Look. We were very emotional at the point. We thought the binary clock was a good design and the booze helped us to believe we were going to get very rich of it. ;-)
Young hackers who have a surplus of income and have funds to spare that aren't being channeled toward debt / family / donations, heed me: save as much of your salary as you can, and put it in boring investments (index funds / etc), probably through vanguard.com (no affiliation, I just use them and have heard nothing but good things from people I trust). You can pretty easily set up your job's direct-deposit system so that a portion of your salary goes directly into your investments without you ever seeing it, it's a good set-it-and-forget-it system. It adds up over time!
Not too long ago the long term rolling returns for the S&P 500 where still somewhere around this number. This article [1] is from 2012, not much has changed in the last four years.
"The average 30-year rolling total return for the S&P 500 starting with 1926, is 2,478% or 11.21% annualized (geometric mean). There were several 30-year periods that had annual returns between 8% and 10%."
Having said so, past returns don't guarantee anything for the future. They might give you an indication though.
Wouldn't it be a better idea to invest in bonds or more stable sources of investment for the next few years until we can make sure of the impact of Brexit-Trump? I wouldn't be surprised if AAPL and other giant third sector companies fall in value right now.
In investing terms, you're talking about a "less risky" rather than "better" idea. You'll only know if something was better after the event in question has passed.
Passive investing when you have many years before retirement means you worry about long term trends rather than short term risks.
while coupons (e.g. the regular payout) might be stable, bonds, too, can fall in value. One interest rate hike by the FED or ECB would send bond prices tumbling.
You're talking about market timing which is incredibly hard (some say impossible) to do over a long period of time. Sure, you might miss the down here (if there is one), but then you also might miss the move back up. There is a saying that time in market is much better than timing the market. If you consistently put money in, you'll naturally also buy the downs. At that point, you just need to periodically rebalance, and with age start to shift to less risky investments.
Ah, you see, because the market is famously perfectly efficient, equity and bond markets have already priced in the expected effect of Brexit-Trump. So investing in equities now essentially gets you a discount over what they would have cost had Brexit-Trump not happened.
Whereas (more seriously) investing in "more stable" things like bonds forces you to pay a premium, because every man and his dog has desperately been chasing stability, safety, yield, etc since 2008, in many cases using quantitatively eased money to do so.
How is the comment you replied to liberal hubris? There is uncertainty with regard to Britain voting to leave the EU. Since the U.S. election the bond market in the U.S. has fallen quite a bit. This is unusual given that the only new information comes from the election. Clearly there are impacts from the election that an average person wouldn't be aware of. Hence the comment about adopting a wait and see attitude. While this may not be a good strategy it hardly qualifies, necessarily, as liberal hubris.
When a thread takes a turn for the worse, please don't reply unless you can make it better, not worse still. Political name-calling makes it worse still.
Since I had to ask you to keep partisan politics out of HN threads only a couple days ago, I'd like to emphasize the point. This is not what Hacker News is for. Please (re)-read:
Nutmeg has a really nice looking website and is heavily promoted, but I'm not really sure it's a great recommendation as the associated fees are higher than competitors.
I'm using DEGIRO (based in the NL), seems to be OK, decent website and low fees. They have this weird thing about loaning out your shares in the regular accounts; I couldn't quite get the risk I'd be exposed to in that case, so I went with a Custody account.
Ah, right, I didn't pay close attention. I selected the S&P mostly as a simple "default" choice to start. It doesn't really matter, since it'll be a while before I can invest any significant amounts.
GERMANS: Be aware! Don't buy any US ETFs when you pay taxes in Germany. There is pretty heavy penalty tax on ETFs. Depends on the difference of the price on the first day of trading of the year and on the last. If unlucky you can pay 50% tax on your gains. I did just this year pay 45% and I won't be getting it back. Read thru this first: https://www.justetf.com/de-en/news/etf/steuereinfach-in-etfs...
Do you mean also for accumulating ETFs? Are you supposed to list all ETF purchase prices/start-of-year value, and the end-of-the-year value in the tax declaration, then?
Do Germans not have any practical way to invest in accumulating funds?
I have read the link you posted and I'm still not clear on how you would end up paying ~50% and not be able to get it back.
If your ETF is "ausländisch thesaurierend" ("foreign accumulating"), declaring it will be a bit more complicated but not that hard. Would you mind explaining your situation a bit better? Maybe I'm missing something (and I wouldn't want to, since I'm looking into this topic myself at the moment).
Historically, as a guideline, you'd have made about 7% p.a. on average, well above inflation. The question is whether you can handle the drawdown (can you keep your nerves during a crash?)
then again: beware of averages. Historical PE ratios are quite high (though EV/FCC would be more instructive) - so it is unlikely that the next couple of years will bring 7%. We're living in a world of free money: if central banks change interest rates the party could come to an end.
Right. If interest rates are increased, that's a sign of a stronger economy and the market might go up in response. On the other hand, traders might decide the Fed is mistaken, the economy is not in fact stronger, and they'll react to the higher interest rates by taking fewer loans and the market will go down.
Basically, the change is already priced-in and you shouldn't worry about timing the market. Buy and hold.
There's no guarantee at all. In a really bad year (2008?) you might get -50% or worse. Then you might get some really nice returns in the years after (or not!). If you average over several decades, historically, the returns have been around 7 or 8 per cent per year, but the standard deviation is enormous. Just look at a long-term chart of e.g. the S&P 500 at https://finance.yahoo.com/chart/%5EGSPC - click "Max" and "Settings" -> "Logarithmic" (you'll want a logarithmic axis so that equal percent changes are equal distance on the plot). You'll see that on average it went up over the decades, but between June '07 and February '09, it lost over 50%, and tripled since then.
I encourage you to read up on this, but someone else with more knowledge should recommend some books.
All of this is correct, but the standard S&P 500 index doesn't include dividends, so your typical index fund will (should) do 1-4% better each year than the S&P 500. The S&P 500 does have a lesser-known version that includes the total returns: https://www.google.com/finance?q=INDEXSP%3ASP500TR&ei=WWJNWK...
banks are heavily regulated and cannot just put deposits (the money you put into a bank constitute a loan to the bank) into stocks. They have to invest more conservatively, e.g give money to solid companies or hold low risk bonds. See Basel-rules to learn more about risk weighted assets (RWA): https://en.wikipedia.org/wiki/Basel_III
Banks operate on a completely different model so it's not a useful comparison, but the answer is that they are borrowing at ~0% and lending 2%+ so they view the world differently
I recommened reading the parents link but if it's all a bit too much for you vanguard does funds that are already diversified and deals with the rebalancing on your behalf.
I read that book this year. The entire book can be summarised as.
Don't attempt to beat the market. The market cannot be beat (many examples in the book). Invest in index funds long term which is the right mix of risk/reward for most people.
It does have a chart in the back which tracks your age and situation. For example as you approach retirement you should start to liquidate your funds and buy government bonds so you aren't hit by a bad year when you have to start drawing on your investments.
It did convince me. I opened accounts with Wealthsimple and Questrade the next day.
I think you misunderstood the parent. All three examples are ETFs with Canadian assets, available on the Canadian stock exchange.
OP's point is (most likely) that you can't buy them directly from Vanguard (i.e. using an account on www.vanguardcanada.ca) but will have to buy them using a broker (e.g. Questrade.)
I really would like to believe this, but please explain to me how then how firms like Renaissance can exist ... Not sure whether it's relevant but I'll add that I'm an economics PhD student.
The market cannot be beat by 100% of amateurs piddling away on their brokerage account during a few spare hours a week.
The market cannot be beat by 99.9% of professional investors spending all their time day and night trying and with a team of people helping them.
I'm calling your bluff on you being an econ PhD student or maybe you have been one for a month or two at most...? If you are an econ grad student you know what RenTec is doing more or less. At least in theory if not specifics, people talk and there's plenty of econ papers explaining what's underneath major quant strategies.
People need to chill bringing up RenTec when finance comes up (Buffett too). Just like they need to chill bringing up Facebook when talking about startup valuations. Outliers are outliers.
Academia doesn't pay that much attention to the real world. Most of the papers out there are rubbish and would be considered junior level work, except with way too much detail.
There are pretty much no econ papers that would describe what happens inside the high end systematic firms. (Source: I work in the industry)
Bringing up the outliers is a perfect counterexample when wild sweeping statements are made. These are not even real outliers, they are valid samples.
>The market cannot be beat by 99.9% of professional investors spending all their time day and night trying and with a team of people helping them.
Professional investors pretty consistently beat the market. But not the ones that you see. The louder someone markets their fund, the more likely it is to be a scam. Your sample is of guys who heavily promote their fund and make money from management fees not performance.
The best managers aren't even made visible to you. Why would you attract attention to what you're doing if you have a good thing going?
I agree & the "pro-index" crowd would improve the accuracy, if not the effectiveness, of its message by saying "non-passive strategies can work superbly, but not for outsiders with <$1M in capital" instead of saying "no one beats the market in the long run" / "you can't predict which parties will beat the market in the long run".
Professional investors are not pretty consistently beating the market...secular! Anyone can have a good year or two.
I'm not talking about dudes talking their book on CNBC. Yes there are shops that beat the market, but if you have beaten the market 5 years in a row, you can't keep it a secret even if you want to.
How exactly do you think the performance is made public, if the fund doesn't want it to be? This isn't about illuminati, this is just logic. You can't hide what you're doing from the institutions you have to deal with, but they won't exactly disclose it to general public.
Why would you promote your fund, if you have all the FUM you need? If you are doing well, why would you tell people about it? It is funny that your position is because you haven't seen it, it doesn't exist.
You say you work in the industry. How long have you been doing this and what do you do?
You don't have to answer but your questions are odd for someone with experience in the industry. But let's get into it:
How is performance made public? The same way people know what "stealth" startups are doing. Sometimes a document leaks and sometimes people talk. Usually both. Let's just say a manager is super secretive. Do you know how many people in the chain know performance anyway... Current and former employees. Current and former recruiters of these employees. Current and former clients. Current and former consultants to those clients. etc... And you're saying all these people also don't have that human urge to brag about these rock stars of the investment world? OK.
Even if that were the case, everyone has a cousin at State Street or HSBC, these people take coffee breaks and love to gossip performance and secrets breakdown there.
This is like Fermi's paradox. If all these funds out there are beating the market, then where the hell are they??
All of the funds beating the market are secretive and successfully secretive? For decades?
If it was as common as you imply there should be more of them known to the public by choice or by accident. That is logic.
Don't be the guy who mortgages his house to buy Herbalife products and tells his wife this is your year.
The comment above said 99.9% are not beating the market. There are thousands of funds out there. All funds are filing Form ADV's now...We know who exists. So yes there's a few people who do beat the market. Those 3 Russian guys in Texas and that story about the MIT PhD's working out of a house outside Miami and so yes, there's a few examples out there. Dinky family offices don't count. But no, there's a not a bunch of professional investors with serious weight under management and outside clients beating the market over a secular horizon.
There's a handful, and if you are at one of them congrats to you. But to come on a forum saying there's a bunch of professional investors beating the market, they just all happen to super secretive billionaires and they don't tell anyone about it. That's misleading. That's tech back office got your info from a e-book kinda talk. And it would be at odds with your original thesis that folks that beat the market are secretive and don't talk. So it makes me think you don't work at one, you just want to believe they exist. But again if you do work at one, congrats. Are you hiring? DM me.
Renaissance is part of the market, and it's the sort of thing that we individual investors can't beat. "The market can't be beat" doesn't mean no one can see better returns - it means a random yahoo like me simply can't compete with the information, processing power, and access funds like Renaissance have.
Thus, an average investor is a lot better off with an index fund instead of trying to pick individual stocks. (Funds like Renaissance's Medallion simply aren't available to people without tens of millions of dollars to throw around, too.)
People have been saying that about rentech for the last 20 years. People have also been saying that about berkshire hathaway for the past half century. At some point, past performance IS indicative of future returns.
Funds like Renaissance's have minimum investments in the millions, are often invite-only, etc. We average investors simply can't play in those leagues.
I'm not sure about any Rentec mutual fund, I don't think such a thing exists, but aren't the funds they have open to institutional investors not doing particularly well?
When most people say Rentec they think Medallion, which while being spectacularly profitable over 20+ years, is now a closed fund only open to current employees last I heard.
Renaissance has hundreds of smart people trying to beat the market. Same with the HFT shops.
You can start one of those firms; in all likelihood, not all the potential profit has been extracted yet. You can hire a bunch of smart mathematicians and/or smart technologists, and spend time working on the problem. And then you'll be in good shape to beat the market. If you're an econ Ph.D. student hanging out on Hacker News, you're already well on your way to doing this with your life, if that's what you want to focus your life on!
But "you", the person with an unrelated day job fiddling with some investing app on your phone in your spare time, starting with a relatively small amount of capital compared to Renaissance's first year, and relatively small risk tolerance compared to Renaissance's first year, and definitely not enough money to hire a bunch of scientists full-time - "you" who's asking on a thread about passive income instead of lifelong career options - you are statistically unlikely to beat the market. That's what people mean by "You can't beat the market."
He's wrong because he's assuming the average result of the zero-sum game is the only result you can have.
It's a simple fallacy most people with a statistics background understand, but the average journalist doesn't.
Saying you can't beat the market, is like saying you can't win at boxing, because on average nobody wins (there's always a winner for every loser).. but I would put my money on Mike Tyson in his prime.
Your expected value for investing across the market, will roughly converge to the market because of diversification. ~20 funds will start to approximate the underlying universe of stocks, because the range of views of the fund will be across all of them. All of the alpha will be evened out into beta.
So after fees - you would be better just investing in an index than a basket of funds. But there is dependence, a good fund is consistently a good fund. So if you get a chance, it's much better to invest in a good fund.
But the best funds aren't accessible to the public, so the public doesn't get to understand the market for what it really is. And there's a lot of shit ones that market heavily to the public.
There is also a populist idea to the notion that indexes beat hedge funds etc, it makes the average person feel good to think the top investors are no better than they are. So why would journalists peddle the true narrative?
Rentech, in particular, data mines weak signals out of gigabytes of historical data, and has a team of PhD mathematicians working to find these signals. Each strategy has some small positive expected value, so in aggregate they can be profitable.
Two reasons you can't replicate this - 'you' aren't a team of super top notch mathematicians with decades of data, and even if you had an exact copy of their trading strategies, you don't have the capital to make the transaction costs, etc, worth it.
This is good advice, attempting to beat the market is something that everyone tries at least once, and repeats until they learn that it is futile. There are bigger interests than the "richest investor you know", and those interests will always win. Every single damn time. Instead, just follow them, and ride the wave.
On average, and when bench-marked against itself taking into account fees. There are funds that consistently beat the market, that you should put money into over the index if given the chance.
But your general notion that the average person shouldn't try is a good one. At the end of the day you have to earn money because you took it from someone else. To think that there is a dollar for everyone is to ignore this simple truth.
It depends on your definition of reliability. Is driving a car reliable? There's no way of knowing it will crash but that doesn't stop you from getting in one.
You see it as a problem, if you are used to the idea of earning money instead of taking money I get that angle. But to investors it's not a problem but a fact of life.
Ramit Sethi's I Will Teach You to be Rich is the personal finance book that introduced me to all the basics (e.g., paying off debts, how credit scores work, why not investing in index funds across diverse asset classes is moronic, etc.).
Dead practical advice despite the somewhat sleazy writing style (see title of book).
any hacker can, in the next ten minutes, cause their CPU to do more arithmetic than the arithmetic (explicitly adding 2+5, and so forth, multiplying two numbers in their heads) that every single person has done in the history of humanity. okay, but that's just numbers.
Today we live in a connected world where 2,000,000,000 people can be reached in any eight-hour period of time.
Any hacker can find any niche and make a product that will be the first search result within it (by being the first; making something that doesn't exist; and telling people).
Why save a salary, when you can create a business, create value, and scale to the entire Internet and give people some benefit?
Every hacker should start one or several businesses. While it may not exactly be a moral obligation, this brings humanity forward.
EDIT to clarify: I am disagreeing with the suggestion that hackers should save all or most of their money - (put in my parent comment as "save as much of your salary as you can") -- rather than saving it, they should invest it into their businesses, adwords to grow it, other advertising and business development expenses, hiring, etc.
My soapbox was prompted by the words, which I'm not embellishing, "save as much of your salary as you can".
I don't think there's anything wrong with saving or with passive investments. But it shouldn't be as much as you can. Engineers have other very good uses of their money, which I outlined.
Some of us bring in value by developing existing software packages which amplify the work effort of some critical sector or another. The renumeration for this work is in the form of regular pay. A portion of which should probably be invested smartly.
As software systems grow they turn into complex systems. They become embedded in the processes of the end users, while requiring constant boring work to remain alive.
I fail to see how this maintenance work is less worthwhile than developing new tools. Any complex task requires decades and decades of labour.
This is not to say that identifying niches that benefit from established tecnhinques and require only some domain specific customization would not also be wortwhile.
But claiming "everybody should find such a niche and become entrepreneurs" is quite bit too much. My mental energy is used in my daily work which brings added value to my orgs and our clients. The benefits of this are enormous - I can focus on deep, technically complex work while outsourcing payroll, taxes, liabilities etc. to my employer.
Effectively, I don't think many people can do deep work and become an entrepreneur at the same time. Also, expert skills in one domnain are no guarantee in some other. Star software engineers can turn up shit or stellar business operatives.
I think you are covering the software engineer in some weird halo of infallibility.
That said, I do have enormous respect for people who have created new businesses. But it hardly is the only way to bring in value.
>But claiming "everybody should find such a niche and become entrepreneurs" is quite bit too much.
This is how you end up at conferences where everyone you talk to is the CEO, but nobody is actually making any money (or, in large part, actually doing any business).
I also love entrepreneurship, but it is not, nor should it be, for everyone.
"The remuneration[1] for this work is in the form of regular pay. A portion of which should probably be invested smartly."
I guess my objection was to the idea of saving "as much as possible." I don't mean to imply that you shouldn't work for a salary: but you should take some of that salary and spend it on actively building or backing businesses, not just passively.
Based on your background I think you would be amazed how much business you could create by investing in/overseeing a developer in India or China, for example. Your knowledge/background + $5000 goes waaaaaay farther than you think. (regardless of who the owner ends up.)
To me this is the opposite of the advice to passively save as much as possible!
[1] I corrected the spelling of this word - I mispelled it before too.
"you should take some of that salary and spend it on actively building or backing businesses, not just passively."
Active investment is highly context sensitive. I'm not denying someone might be plausibly in a position with sufficient information, domain knowledge, connections and a small amount of capital to operate as you suggested.
Your claim that operating on this manner is the obvious best choice for everyone is highly controversial. For starters, private investment requires trust and communication and just the culture barrier to understand the true rules of business and engagement are non-trivial for someone who's native culture is for example northern european.
Basically, I'm totally clueless. I have no idea how to a) hire an indian software dev for a few thousands b) what value added activity I should require of them and c) to whom to sell their work to.
I do know, however, how to invest into low cost index funds with reputable finance organizations. Thus the latter from economic perspective is a highly more enticing option.
I presume you have some specific situation in mind. Perhaps you could give some 'hypothetical' scenarios and what their profit model is?
I don't want to start a business and in fact I specifically plan to never start a business. Sounds terrible. All that... business stuff. I shudder to think about it.
I do like programming, and I plan to spend my productive time on this Earth programming on projects that interest me and help humanity in some way, but I just absolutely 100% have no plans to start a business. I admire your excitement about the idea, but I think that maybe not everyone feels the same way :)
(I also recognize that maybe not everyone feels that automatically saving+investing as much of your income as possible is a good idea - I'm mainly attempting to reach those folks who do think it's a good idea and just need a little bit of prodding to actually set it up.)
> rather than saving it, they should invest it into their businesses
"Saving it" here is not hiding it under the mattress. Buying stocks is literally investing it, only into other people's businesses. Buying corporate bonds is lending it to other people's businesses so they can grow. And investments into existing established businesses could easily be argued to have at least as large a potential impact as starting out on your own with a minor project that is more likely to fail than not.
> Why save a salary, when you can create a business, create value, and scale to the entire Internet and give people some benefit?
Risk tolerance.
If, for whatever reason, my business doesn't turn as much of a profit as I'd hope, and I've spent everything I could on it, I'm in an awful position: both as a person who needs to keep a roof over my head, and as someone hoping to do good things for humanity. If I'm on the verge of bringing humanity miles forward, and fail, I've done less good than if I reliably brought humanity a few inches forward.
On the other hand, if I do save my salary up, I can choose at some later point to spend all of my time and energy on something cool, and keep spending that time and energy until something happens, because now my risk tolerance is much higher. And then it's much more likely I will bring humanity forward by the miles I wanted to.
> Why save a salary, when you can create a business, create value, and scale to the entire Internet and give people some benefit? Every hacker should start one or several businesses. While it may not exactly be a moral obligation, this brings humanity forward.
How does starting a business bring humanity forward? Maybe I'm just pessimistic but as far as I can tell the pursuit of money largely just ruins things.
I would think that a "hacker" would make things just because they can and enjoy it, without concern for things like profits or market value. Indeed weren't the very first hackers amateurs and not professionals, in the literal sense?
I'm not saying that people should just forego money completely of course, as I am just as guilty of anyone of wanting more money. I just don't understand why "every hacker should start one or several businesses." if we're solely concerned about humanity.
I would also add that the author's book http://earlyretirementextreme.com/ere-book is great,
and lets one get the essential points of what he has to say without trawling through numerous posts.
It's good advice to save money and to spend conservatively, if you're poor.
On the other hand, the implicit question of the post was "what did you create to generate passive income" (it's called "Hacker" News, not "Invester/Banker" News).
> It's good advice to save money and to spend conservatively, if you're poor.
It depends on how well you manage the present. Aiming towards some perfect idyllic scenario in the future is not always so wise. It depends on how you manage that particular present you have crafted for yourself in the future.
I don't think this is always accurate; a lot of poor people are poor through spending habits and poor financial management, not through lack of income.
I think that it's also good advice if you're not poor :)
Your second point is absolutely correct, but I still think that my comment answers the root question - how did you set things up such that you're automatically being given money for free on a regular basis? - in a way that is simple, requires very little effort, and has a very good chance of working for many people who are able to try it.
I have read a lot about passive investing (The Intelligent Investor, Mr Money Mustache etc.) but I live in France and it does not seem as simple as in the US to invest in a SP500 index fund for example. Especially if you want something that is quite tax efficient. Does anyone have any advice?
Thats right. With a PEA you can avoid capital taxes provided you hold your stocks long enough.
As per how to open a brokerage account for alien non US resident, several years ago I managed to open an account at interactive broker while living in hong kong. They have among the lowest fees of all brokers and good software. Pretty sure its also possible to open an account while residing in france.
One thing to note though: as an alien non US resident, any US dividends will be taxed at 30pct in the US, directly deducted by the brokerage company
Open an investment account in the USA - it's fairly straightforward. I don't know your tax system in france, but you can invest in the US as an individual or an entity, probably worth talking w/ a tax attorney about how to do it - it's certainly done by others.
Open an ETRADE Securities account if I'm neither a legal resident of the U.S. nor a U.S. citizen
You won't be able to open a brokerage account online if you are not a legal resident or citizen of the United States because we will need some additional documentation from you. If you're not sure if you're a legal resident, see the Help topic Determine my residency status.
Request a brokerage account application by mail, or download it from our Forms & Applications page.
Download a Form W-8BEN.
Complete sections 1 through 6 of the application (the section on options trading isn't required).
Send your completed application and Form W-8BEN, along with your initial deposit and any supporting documentation, to us at:
By regular U.S. mail
ETRADE Securities LLC
PO Box 484
Jersey City, NJ 07303 - 0484
By overnight mail
E*TRADE Securities LLC
Harborside Financial Center
501 Plaza 2
34 Exchange Place
Jersey City, NJ 07311
1-800-ETRADE-1
Just want to chime in to say that using a broker to buy index funds should be possible in France as well. I'm in The Netherlands and use DeGiro[1] which is available in France as well, so that might be an option. My investment portfolio basically consists of a few index funds, all can be bought once per month with this broker without a brokerage fee.
As for tax-efficient ways, my french isn't that good so I don't know the details but if I understand this topic [2] correctly you should have some options like PEA, PERCO/PERP, and/or PEE/PEI/PEG
N.B.: There will always be some discussion around this specific broker because their 'default account' contains a clause where this broker is allowed to temporarily loan your assets to other customers. Don't do this. You can get a so-called 'custody account' (which is basically a regular brokerage account) that's only marginally more expensive.
Earlier this year, at my last boring corporate job, I was trading stock trading stories with our head accountant. (Like the time my brother and I were trading stock tips about 10 years ago, when he turned me on to some up-and-coming German solar energy firm and I mentioned to him some small biotech company I had just read about. I invested a couple thousand dollars in the company my brother suggested and it was bankrupt within 24 months. My brother invested in both and the company I had mentioned -- I can't remember its name and only even vaguely remember the conversation -- has gone on to something like 50x return, easily making up for the losses from his lousy recommendation... But I digress.)
I told the accountant, who I always found watching CNBC in the break room and I suspect still dreamed of being a day-trader, that the best investment I ever made was our company's ESPP (Employee Stock Purchase Plan).
He said, "You know what? Same here."
(Standard disclaimer: max out your 401(k)/IRA contributions, first.)
It's important to remember that this is putting all of your eggs in one basket to a certain extent though.
Your income, your 401k match, and your ESPP are all tied to your employer, so as long as things are good, ESPPs can be a great way to make easy money, but if things take a stark downturn, you can find yourself with ESPP you lost money on, a slouching 401k, and no job. The chances of that happening are fairly low, but still something that makes me a little uncomfortable about ESPPs.
Obviously your advice to max our 401k/IRA contributions first should mitigate a lot of this, but I think it's important to mention the risk too since there's a certain temptation for younger engineers who think it sounds like easy money and don't realize the full implications of it.
That's true, but I always sell my ESPP as soon as it is purchased. That is an immediate 15+% return. Our ESPP is 15% off of the lower of either the beginning or the ending of the offering. Of course the hope is that it will be the lower at the beginning of the offering so that the sell will be 15% + the amount the stock has risen since the beginning.
Well it is 15% but you are paying income tax on it because you aren't holding it for a year. So depending on your tax situation, it may be closer to 7-10%. Still good though.
The only company I've worked at with an ESPP required you to hold the stock for 1 year before selling--not in the sense of tax incentives unfortunately, but you literally cannot sell before 1 year. I didn't realize there were ESPPs where you sell immediately. In that case, woo free money!
"...the best investment I ever made was our company's ESPP (Employee Stock Purchase Plan)."
This is certainly not true for all companies. I lost over $100K due to our Employee Stock being driven into the ground over the course of a decade by a CEO and board who had loose ethics and no business running a company.
My advice is, before investing in you're ESPP (or Employee Stock Ownership Plan - ESOP), even if you're surrounded by exceptional talent, take a close look at your corporate leadership before purchasing. If they seem sleezy and disingenuous, they probably are and it may be 10 years before you realize you've been totally screwed.
Good point, I forgot to mention that. I think that it's possible for a lot of young people in our industry to save significantly more than 15% of their income, and so I should have said: max out your contributions to retirement accounts every year and then set things up such that you're automatically saving as much of your remaining salary as is comfortable (e.g. if you're a recent college grad working in SF, and you have roommates, you might find that this percentage is pretty high!).
I was on the "max out retirement accounts" train when I was younger. When I got older and home prices got massively inflated, I wished I kept more of that in non retirement accounts to be made more easily liquid for a home without steep penalties.
Saving tax while something grows is great, unless you need that cash sooner. Then it is not too helpful.
I wish there were a tax advantaged vehicle to use for setting aside money for a home.
So yes, definitely invest in tax advantaged accounts, but do so with a solid understanding of your expected financial needs as best you can model for the next 5-10 years. If you need access to that money sooner, what you'd lose on tax may be worth the flexibility of having those investments somewhere more easily liquidated.
$10k is well within the variance of fees and fluctuating interest rates on a home purchase. On the scale of real estate (in and around the cities that have significant tech employment) it's pocket change.
EVERY contribution you make to a Roth IRA/401k can be pulled out, tax-free, at any time for any reason. It's the earnings you have to be careful about. But for example if you have contributed $20k to your Roth IRA or Roth 401k, and it is now worth $35k, then you can pull out $20k at any time for any reason, while for the other $15k you have to wait until 59 1/2, or use SEP withdraws, etc.
In addition, for a first-time home purchase you can pull out up to $10k without penalty (but with normal income tax applied) from a traditional IRA or 401k.
Nice blog, but watch out for advising people that putting money in index funds 'pretty much assumes an 8% return'. Returns can vary wildly year by year even if 7-9% annual is accurate over the last 20-30 years or so. Bogle (and others) is estimating the coming year's returns to be lower than 7.
Yes, it works. I've been investing a minimum of $500/week for the past 8 years. Currently I'm investment $1000/week. I make good money and keep my expenses low, and now have more than 33x my yearly expenses in investment/savings. I'm planning on retiring early...
That is already passed the 4% withdrawal rate (can take out 4% every year and never decrease the principle), which is 25x annual spending in savings/investments.
This isn't really passive income outside of the 2% dividend yield of a total market index fund, which isn't all that great. A $500,000 investment only yields about $10,000 annually. (Not to mention the significant risk of a market drawdown in a given year.)
I think the idea is that you can plan on withdrawing 4% every year as well. The more flexible you are with your expenses, the more you can withdraw while ensuring you will have sufficient income throughout your retirement. I like the hybrid constant-percentage / constant-dollar withdrawal method where you keep 7.5 years of withdrawals in bonds and the rest in stocks. So a $1m portfolio produces $40k per year so 7.5x * $40k is $300k in bonds, and $700k in stocks. https://www.bogleheads.org/wiki/Withdrawal_methods#Combinati...
For what it's worth, my best passive income was from investing as much of my income as I can part with paycheck to paycheck. No boring investments though, always the exact same two funds: UWTI and DWTI, both of which are gone, they delisted on Dec 8th.
That said...there are many funds like them, those in particular are 3x leveraged crude oil ETF's. That means if the price of oil rises 1%, UWTI rises 3%. If it falls 1%, DWTI rises 3%. Crude oil as a market has "predictable volatility", that (simply) means that within a given day, the price will rise/fall repeatedly within a sane range(given no extraordinary circumstances). Identify this range, and buy and sell on both sides(short and long) to take advantage of the range. Follow the big money(banks), and you'll be just fine. Never go against the flow, you will (virtually) always lose.
This is very bad advice. 3x funds are not meant for long term buy an hold. They experience contango and even if they index end up flat you can still lose money from the gyrations of the market. Nobody should b investing in in leveraged etf longer than a few days.
I didn't say to buy and hold it...that would be very foolish unless you know something that noone else does(which is unlikely). I was talking about using the daily volatility to profit from following the banks. ie: day trading. My positions in leveraged funds last less than 60 minutes, and the average is probably closer to 10 minutes.
Before you jump into 2x or 3x, you should be able to reliably generate returns from a non-leveraged ETF tracking the same commodity.
They'll move 3x. When oil falls 1%, UWTI rises 3% and DWTI falls 3%. That's good for a short term bet if it goes your way. In the long term it corrodes the value.
Lets say UWTI is trading at 100 today. Oil is trading at 50.
Day1: Oil falls 47.5 (5% drop). UWTI will fall to -> 100 * ( 1 - 3 * 0.05) = 85
Day2: Oil rises back to 50 (5.26 % rise). UWTI will rise to -> 85 (1+ 3 * 0.0526) = 98.42
So even though oil price recovered, you lost $1.58. Over a period of time, rise and fall in oil prices corrodes the value of UWTI & DWTI (and similar leveraged ETFs)
Mr Money Moustache has 2 or 3 rental properties which are wealth appropriating not wealth creating. He's using the wages of other families. He goes on about how $10 is a lot yet takes far, far more in rent each week.
Not sure where to start here. Are you suggesting money gained is a proxy for wealth created? It's the product of an imperfect system. Some people add more value than they are paid for, others the inverse. The system heavily favours economic rent extraction via land. Almost all new debt is issued via land.
Quite simply people have figured out it's a rigged game and are piling in, hence the asset bubble and the fallout effecting an entire generation, which perhaps you missed.
I'm not really interested in discussing this with you either as just pointing out things are paid for is just taking the existing system without any question as "correct".
I understand what you are saying, but I think you are missing an important concept. If you created more value than you spend, you have an extra. Other people want to spend more than they created. So what happens is that people who have the extra, can loan their value to those who have a deficit.
This loaning can also be considered a service. People are not forced into renting. What Mr. Money Mustache is saying is "Hey, don't be the guy with the deficit, be the guy with the surplus, because everyone with the deficit will work for those with the surplus". What I hear from US with all their credit cards, it seems it's a culture of spending way more than you earn. Spending money that you will receive at the end of the month. Which is pretty stupid.
He says: Earn a lot, spend little, invest the difference. Once the revenue of your investments covers your spending, retire. That's what he's saying. And the key is indeed living frugally, which makes it all easier.
And yes, he rents out houses, that's his investment.
I don't see anything wrong with this.
If everyone was a landlord, then that would be a pretty bad investment now would it?
I disagree with his wealth appropriation and the idea that he is somehow living frugally whilst relying on that appropriation. Fundamentally we cannot all claim the labour of others using the system to force their hand.
> we cannot all claim the labour of others using the system to force their hand.
What does this even mean? He is providing a good/service, and people are willing to pay him for that good/service. He's not living off the pain and suffering of others...
Oh, I invest the automated way too and figured that's the best way given I know this is important for nest egg and such and I want to spend as little time as reasonably possible managing investments .
For my Indian friends here (or people interested in investing in the Indian market), I'd suggest http://scripbox.com (no affiliation, just a happy customer).
I started a year ago when I was 25, and am glad I started this early(-ish).
Do you have any thoughts or sources on Indian micro-loan investments? It looks like a way to help people in need while gaining some profit off their success. I'm more interested in the former, but I do not wish to simply donate. I do not believe it to be the way to go about these things.
Do you mean something like Kiva or Zidisha? They're quite popular, but there's a very real chance that the borrower can default on your investment. Not a huge deal though, because if you're micro-lending then this is expected. I don't think the interest rates are good either.
Doing it for charitable reasons is fine, but it's not a great way to make money IMO.
I've also moved temporarily to a very cheap COL country so that I can focus on some more side projects to pull in extra sources of income before I return to the work force.
Question: how do index funds (or any kind of stock, really... in fact this question isn't really about index funds) "pull in the rest"? Do you actually manage to sell them when they're high and buy when they're low again? Or do you get stocks with dividends and just make money using the dividends? Obviously merely possessing stock of high value is kind of moot if it doesn't turn into cash somehow, so I'm curious how people usually do this. (I don't know much/anything about finance.)
Ah, so no actual income then? Just stocks going up in value? As in, at some point you'd have to sell before you actually have any income from it, right?
Index funds tend to have some dividends, because while not all stocks yield dividends the dividends from the ones that do still get distributed to the holders of the fund.
But even if a company doesn't pay dividends, it will often make a profit that ends up on the company's books. A part of this profit, proportional to your ownership, belongs to you who own the stock.
In an index fund, the stocks contained in the index will on average pay out a certain dividend and turn a certain profit that isn't squandered on worthless projects.
This last part is what makes stocks increase in market value long-term, and which also makes it reasonable to sell a small proportion of your shares every year as a passive income.
If the dividends and your sales constitute less than 3-4% of your funds' total market value each year, you can expect your portfolio not to decrease in value long-term.
> But even if a company doesn't pay dividends, it will often make a profit that ends up on the company's books. A part of this profit, proportional to your ownership, belongs to you who own the stock.
You're totally missing my point. I'm saying, even if your stock is "worth" $1 trillion, if you don't actually ever sell it, you haven't earned a single penny from it. It's only money when it's actually money. So my question was whether the OP was ever selling the stock or not.
This part of your statement is incorrect: "It's only money when it's actually money."
Stocks in major corporations are generally considered a liquid asset - i.e., they can be easily converted to cash. [1]
Don't confuse liquidity and risk exposure. The money is still subject to the risk of the market when it's still being held in stocks, but it's approximately as good as money.
If you sell you pay taxes on the gains, so you are probably better off borrowing against your investments if you need cash, since borrowing isn't a realization event for tax purposes.
Investments that pay dividends aren't as good for individuals since the dividends are taxes at ordinary rates.
You would borrow from the bank, using your stock holdings as collateral. Not as easy as he makes it sound, but not unheard of if you have even a meager amount. Say, at least 50k.
Also, wouldn't this mean you have to pay interest on the ENTIRE amount of the loan, as opposed to tax on just the gains? So if you have $1000 that means at 2% interest (I assume that's yearly) you're paying $20/year, whereas if your stock went up 5% (= $50), that means you'd be paying (say) 25% of that, which is $12.50. So it should be only better if either have a high tax rate or your stocks /really/ increased in value (not just kept pace with inflation).
That requires 110k$ and you can't just take money with that rate, it's margin. So you should have more than 110k$ to take some of that money and replace them with margin.
I chose Sofia, Bulgaria. I pay about $500/mo for all my expenses. It's true that I could find that in the US as well, but I'd be hard-pressed to find something that isn't deeply rural.
In Sofia, I'm in the capital. There's lifestyle necessities like grocery stores, fast internet, etc. Plus I won't need a car because of the excellent metro. If I want to catch an American movie or a show, there are malls/theatres. It really has just about everything I need.
We started a small online shop about 10 years ago, and it's mostly automated. About 5 minutes/day + one week / year of work.
Before that, I had spent a few years (trying to) run rather big software projects (for me – I was 18 or 19). They had cost me so many sleepless nights that I swore to never again take on customers paying me more than 100 Euro each. Now, if anybody complains, or gets on my nerves, they get their money back and are never heard from again.
My friends joke I'm the living example for an unconditional basic income. They haven't decided on the outcome yet, though.
I wrote my first e-book [1] about how to save money to work less and live your dreams. I'm really happy for a first attempt, and it has inspired me to write more.
Thanks! Marketing has mostly been on my website[1] and social[2]. I'm getting reviews from people interested in what I'm doing, sites that cover Overland Travel, 4x4, etc. (I'm driving around Africa for the next 2 years)
What i did? Well when i have a idea that i think somebody else could like too i throw it into a website, then throw it out there and see what people think. Sometimes i get valuable feedback and can improve, sometimes it is good as it is.
The only "secret" other than user generated content (what makes it actually passive) for me is to never stop trying. I have like 50 in use domains right now, many which i did not extend because they did not pay for themself after a year.
My site is only 1.5 years old. Revenue was stable that time. I think the biggest break was before that. But my site is also not "made for adsense" which was what google mostly penalized.
Its more like a forum, but not one. Users can post their own content and others can vote and comment that. Plus it has a huge searchable database.
The problem with static sites (i have those too) is that google loves site updates as often as possible. A site that is good ranked today can be killed by a more dynamic one next day.
Well since i quit my job in switzerland and moved around the globe to work on my own stuff (I dont only do stupid content sites) about $1000/month + Some plane tickets here and there.
@brettz, not sure if you work for PornHub or not, but if you do and this question isn't weird for here: do you know if PornHub would be interested in a video superresolution service tuned specifically for pornographic content? i.e. upscale SD to HD or HD to UHD, but with state-of-the-art algorithms that go far beyond "dumb" upscaling. My friend and I are tinkering with the idea of starting a small service to do that, filling specifically the adult video niche so we can focus the algorithm for improved performance (versus a more general superresolution technology).
Sorry if this isn't in your wheelhouse or it's inappropriate to ask in a HN comment.
Also are you going to support and fix the frequent bugs that png optimizers run into with esoteric color space/alpha combinations beyond the best effort...?
Optimage can do automatic lossy (visually lossless) optimizations on JPEGs and PNGs. It means you don't have to manually tune JPEG quality for each image and can get some PNGs quantized to 256 colors if visual differences are negligible.
It uses a modified quality metric based on Contrast Sensitivity Function (CSF) and contrast masking of DCT coefficients for JPEGs, and a custom one for color-quantized PNGs (major difference is sensitivity to noticeable gradients).
Optimage has a lot of tweaks to compression algorithms to squeeze some more bytes (Pareto principle here). But much more bytes are saved by exhaustively trying all possible image data representations, e.g. fast brute forcing of PNG delta filters, dirty alpha, palette sorting.
> Also are you going to support and fix the frequent bugs that png optimizers run into with esoteric color space/alpha combinations beyond the best effort...?
At some stage, yes. Right now I'm focused on things like losslessly rotating JPEGs according to Orientation meta in Exif, adding CMYK to RGB convertion when Convert to sRGB is ON, supporting container formats like ICO and ICNS, more tweaks to compressors for performance and smaller output, GUI improvements, etc.
Any thoughts about delivering this as a webservice? Lots of catalog images out there are managed by merchants and need hands-off processing. Happy to chat further about this.
Just a small suggestion, clicking to see the difference on the demo images wasn't clear at first. Maybe you should use one of those sliders that they use for before/after images. I think that would be better UX.
I think that kind of drives the point home. Maybe it's my display or my vision, but I still can't tell a difference between the "Before" and "After" pictures. That's very impressive to me, looking at the compression ratios.
The only way I could make it fairer is to add a magnifying area zooming to 100% but that would be too much work. Hoping that links to images is enough.
My brother and I have built a couple of test prep sites for UK medical school entrance exams: https://www.bmat.ninja, https://www.ukcat.ninja . BMAT Ninja made about $25k this year (up from $16k last year) and UKCAT about $10k.
Didn't do any work on marketing really so it is pretty much passive, but I think with a bit of work they could both do a lot better. It's a very seasonal market - we only get customers for about 3 months per year (the 3 months leading up to the exams), so thinking of branching out into other exams that occur during other times of the year so the income is a bit more steady.
Thanks :) Nothing special really - Laravel on the backend, Bootstrap on the frontend. And React for the interactive question bank interface (probably not necessary but I wanted to learn it...)
We paid freelancers from around the world (via www.upwork.com) to write the questions based on some guidelines we made (it's not really hard to write questions of this level so anyone can do it with a bit of guidance) and then paid medical students to write the solutions. Probably spent about $7k on this stuff back when it started, so it did require a bit of upfront cost.
Interestingly it has been very popular with teams (so selling a set of licenses so a whole team of developers can use the material). I also teach the same material in person (either in-house or in open workshops) so I'm keeping the two in sync. I made some notes about that process on my blog: https://rachelandrew.co.uk/archives/2016/06/03/creating-an-e...
I intend to do a bit more marketing of both the in-person and online training in the new year.
As an independent (not working for a browser vendor) invited expert to the CSS Working Group, training and offering this course is really how I can fund doing that.
It's built using my other product Perch Runway, using our Shop add-on :) took me about half a day to put together as Shop deals with membership stuff by default.
Some years ago, I did some referral promotion for a webhosting company with nice results, around 70k.
Later, company rules changed and I stopped actively promoting it, but second level referrals still are generating 5-10k year with doing absolutely nothing of work.
In early 2016 I purchased commercial real estate, got a 25 year fixed rate mortgage, and leased it. This requires very little of my time every month, and the post-tax yield is above 5%. I couldn't be happier.
I'm now considering doing this again in 2017. Hopefully interest rates will remain as low as they have been in order to lock-in an attractive mortgage.
Contractually, day-to-day maintenance, no. Any extraordinary maintenance (a water pipeline bursts, electrical problems, etc), yes; but that would be covered and taken care of by the insurance company.
In the commercial world, NNN (triple net) leases are popular. The tenants take care of property taxes, insurance, and maintenance, so it is a good passive investment since you don't have to worry about operating expenses.
You don't say where you are based, but you are going to get a shock if you think interest rates are going to stay on the floor. If you can get a genuine 25-year fixed rate, great, but you need to tread carefully here.
Brexit, Trump, EU sentiment, China trying to deal with their own problems, they're all pointing to the same way: devalued currencies. Where they start, rising interest start to follow.
I'd also be wary of assuming commercial real estate was a lock-in. I've heard horror stories.
I'm glad it's working for you right now, I'm just saying: make sure you tread carefully and have done your research before you start gearing up.
This isn't necessarily true.
The US dollar is actually increasing in value as people want their money to be safe. If Trump does bring back American jobs, meaning less jobs in Asia, the dollar buy will continue, depressing Asia and strengthening the US for now.
But you're right, the OP definitely needs to tread lightly with property and the contracts. The devil is always in the details.
The unemployment rate in the US is 4.9% which is basically full employment.
Now sure there are a number of people who don't report and those who wish to work more. But I don't think it's going to be easy to get those people back into work. Most are either in industries that are disappearing due to automation. Or they lack the skills/training to re-educate themselves.
And without tariffs (which will impact exports) there is little chance of US being all that competitive in most industries that compete with Asia (I assume you actually mean China).
It's not just old people: "in 2000, if you happened to be a 20-year-old man with less than a Bachelor's Degree--and when I say 20-year old, I mean in their 20s--21 to 30. About 8% reported not working at all during the prior year. That number, today: About 18%."
Roughly 100 million people in the US are out of work or no longer looking for work. That's approx a third of the population. "4.9% is basically full employment" is a terribly naive statement. The trend clearly shows things getting worse, not better.
The all-in fixed rate is 2.10%, and let me repeat: fixed. Not LIBOR + spread + you need to have you savings account with us + you need to buy my home insurance, etc.
I don't understand why you say "tread carefully"... when it's the bank bearing all the IRS cost. Plot any LIBOR curve, and you'll see that the bank is the one to lose here. Banks are fighting for customers, and cheap loans and mortgages is the game they are playing. I could go into more detail, but given that I have a 12 month DSRA account in place, I'm quite happy with the investment.
"Risky" investment for commercial real estate in a tier I area in a European capital? I find any residential property more risky and volatile, at least from a price elasticity point of view.
I guess we have different views on how we perceive risk. But that is ok.
or, like you are implying, I shouldn't have saved any money, and spent it all... fancy cars, exotic vacations, and parties. I guess I gave up one lifestyle to reach another one. We all have different priorities.
I don't believe land is taxed highly enough so the system encourages monopolising land to appropriate value added by labour that should be going to workers.
I think right now we have a situation were money makes money and selling your labour doesn't, in the average case not in the "I'm a senior engineer at google" case.
I just don't see how this ends well. Workers struggling to get wage rises at all and yet 5% per anum return for those with capital. We've just had Trump and yet here everyone is basically saying "I can get further ahead by playing the system".
Many companies, large multinationals to small startups don't want to OWN property. It's capital intensive for them, they want to rent. Does Starbucks own its coffee shops? No. Can't you see how renting property is a service to many?
Stop being apocalyptic simply because someone owns property. Take a chill pill.
I think this is a huge problem. I think that is illustrated by the fact that you feel you can make well ahead of wage rises without any risk. The financialisation of land is driving a wedge between those with capital and those without.
We've just had Trump because some people are feeling very left behind. I'm not saying you caused Trump, but I think the system that incorporates rent seeking through land is a big part of it.
Land prices are all consuming, they are taking wages from workers and then rent from net wages of workers. The system as it stands is very efficient at adjusting credit to soak up any gains into banking and land speculators.
> In early 2016 I purchased commercial real estate, got a 25 year fixed rate mortgage, and leased it.
What was your downpayment? Asking because I tried to do the same thing earlier this year. Thought I was clever, did the math on how much I can rent out an apt on AirBnB, and what the mortgage would be on 30 year fixed, and my calcs said I need to put only 5% down to break-even. Then I contact lender and turns out, for Investment properties, they require minimum of 25% to 35% cash as downpayment. They said this was to hedge their risks against a borrower who would bail easily if an investment property goes south.
Any way around this? i.e. around not having to put 25% down on investment RE?
No. Because the lender knows your AirBnB investments could easily be regulated out of existence. I suggest you live super frugally and save up cash for your real estate purchases. (We did this and so have many of our friend.)
I do have portfolio of small web apps: tools for learning music notes, non-latin alphabets, language flash cards and so forth.
They are making some nice money each year, but the trend is quite clear: given same traffic I am making about 50% less each year. Ad revenue is way down (more adblock users, less money per click, CTR is down), but paid premium plans are balancing it a bit.
These projects are still my biggest passive income stream, but they are going to die in few years. Other than that I am owning agriculture land (that I am renting), rental property and portfolio of p2p loans.
Those traditional assets are much more expensive to acquire, but then the yield is much predictable and stable. Still, the tech projects are my best source of income considering the amount of money/time required to create it.
I am from Czech Republic and I am using quite a new platform called Zonky.
What I see is that quality of loans go down as a platform scale and I am lucky to be with this platform from the start. So my cohort is made up of mostly early adopters. I am year in my portfolio with 0 defaulted loans and 1 late payment (I feel like this loan will default during the lifetime).
My strategy is to invest to nonconsumer debt (no car loans, no holiday or Christmas presents loans or loan refinancing). I am investing in loans with disclosed profession (investing in IT professionals, govt workers, school teachers...) and with disclosed loan history (aiming to people with 0 debt). I want the loans to be paid in 3 or 4 years. I do break my rules for about 5% of portfolio that goes to riskier loans, this is where I get majority of my yield, otherwise my yield would be like 4 or 5% instead of 7 - 8%.
I guess this strategy is not applicable in US or UK, where is normal to have some debt (there is/was very different debt culture in most EU), and even here is still harder to discover these good loans, so I basically stopped investing in there.
Next year I want to start experimenting with b2b loans for unpaid invoices (business sell their new invoices with terms like NET30 or NET90 to boost their cashflow).
Helpmanual.io is my first attempt at passive income. Launched 6 weeks ago and traffic is building nicely. There's still a fair bit to do but the delight of sites like this is you can make improvements when you want. Shame that ad income is less than it used to be but we'll see how it gets on.
Man pages in the terminal are pretty annoying as you can't (easily) search them.
By "Google" I presume you mean online indexes of man pages E.g. This site.
The other man pages sites are ugly, old and incomplete, despite that done of them rank pretty high on Alexa. I built this site to end up smarter, more modern, easier to use and more complete. Still a work in progress atm.
On Firefox, code examples are sometimes 1-2 pixels longer than their viewport, so you can get a fairly pointless scrollbar. See, e.g., https://helpmanual.io/man3/printf/
One suggestion: how about guessing at hyperlinks. For example, there are a few underlined instances of `size_t' in the printf man page. If you ask for the size_t man page, you get the man page for stdint. Suppose I had a device on my desk that could automate this sort of drudgery for me...
(I did something like this for my patched version of Bwana: https://bitbucket.org/tom_seddon/bwana, original: https://www.bruji.com/bwana/ - works well, at least for the OS X man pages. My code only looks for man pages with the exact name, though, since it runs on demand. If you're doing a preprocess to generate all the pages ahead of time then you could perhaps afford to be more thorough.)
One idea where you can distinguish you're in addition to being just better: add commentary/disqus and have some sort of system that aggregated and ranks comments (like stack overflow answers) on each man page. I find that man pages always have all the info I need, except it's often buried or there are surprises, but others' knowledge/experience can really save you from common pitfalls not in the man pages. Just having s crowd-sourced highlighter function of sorts would give you a unique offering among the competing options. You could also augment the see also section. And for marketing, you could have a blog and write about the top BSD tools based on activity, searches, etc, or up-and-comers. You could feature community commentary (like how to best use a tool) and build in some kind of point/reward system.
I have more ideas but I'll stop there. Good luck with your project!
Would you consider your trades luck that won't last? Also I am curious what's your background that made you so successful in trading? I personally had 10x gains on crypto market but it was a 1 year investment, (no speculations) done with some research but I'd say I mostly just got lucky.
I'd say paying a very expensive tuition to learn trading and patience. But on the holding department (buy and hold), you are delusional if you don't think that luck doesn't play the major part of it.
I wrote an ebook that helps Junior Developers get jobs - it's primarily targeted at bootcamp grads: https://kokev.in/hired-fast
In the past 8-10 months, it made about $5k+ through sales as well as partnerships with a couple online bootcamps. Not too shabby as I spent almost no time marketing it. Plus it was fun to write since I'm passionate about the topic and I've received some awesome feedback (of the "you actually changed my life"-sort). That was more than worth the hundreds of hours I spent writing it, the small bit of money aside.
Here in Brazil we have it easy. The most boring funds (the ones which track the interbank rate - CDI) easily return around 12% per year (depending on the administration fee; the smaller the administration fee, the higher the return). With the inflation around 6% per year, this gives around 6% returns before tax. If you stay with the fund for at least two years (and it's of the correct kind), the tax rate is 15% over the gains, so you have an after-tax return of around 5% per year above inflation. And that's for a fund which basically never gives negative returns.
You can go further and buy government bonds directly, through the Tesouro Direto system. Those indexed by the SELIC rate (which is sort of related to the CDI) are currently around 13.5% per year, before administration fees and taxes (in fact, the boring funds I mentioned above mostly invest in these SELIC-indexed government bonds).
This will change when (and if) rates get lower, but so far, investing in these funds or bonds is the simplest (and one of the best) way to have passive income.
You probably know this, but it's always important to keep in mind what causes such high interest rates.
A high interest rate is a signal that lenders are wary of lending money to the borrower because of an increased risk of default/inflation. That's fine as long as you are aware of this, but don't think you're getting a "better deal" than someone investing in a boring 1% German government bond. That 12.5% you're getting in addition represents the increased risk that the Brazilian government might default on their debts or the currency might inflate enough to negate the advantage.
This is all true - and if you look at the UK gilt price/yield over the last six months it demonstrates this aptly - yields started to increase in June as everyone tried to sell their gilts. As you say, the yield only happens if the government pays the nominal at the expiry - and if yields are high it's because the market lacks confidence, and people are selling for less than nominal.
Brazil has much more foreign reserves than most Europeans country. Our interest rate isn't high because of default risk, actually is more the opposite - rip off the country.
I live in Brazil, so if the government defaults, every other investment I could have made here would also crash, and the local economy with them. It's not called the "risk-free" interest rate for nothing: it's the lowest risk investment one can get within Brazil. Corporate bonds, for instance, will have a higher return, due to their higher risk.
As for inflation, when it increases the SELIC/CDI rates tend to rise with it too. And if you're afraid of that (it hasn't been long since we had a hyperinflation, so a lot of people still are), another government bond (NTN-B) has a return of inflation (measured by the IPCA index) plus a pre-fixed component (currently around 6%). Due to its pre-fixed component, it has some interest rate risk (if the interest rate rises, its present value drops, and vice-versa), but that's not a problem if you intend to keep it to term.
And, actually, the high interest rate is set by the government, as a way to control the inflation, so it's not as linked to the risk of default as one might think. The government could decide to lower the interest rate (and it has: a few years ago, it was set lower, but that led to the currently higher inflation, so the government increased it again to contain the inflation).
> I live in Brazil, so if the government defaults, every other investment I could have made here would also crash, and the local economy with them.
Wouldn't that be a good reason to invest some money abroad?
> And, actually, the high interest rate is set by the government, as a way to control the inflation
But surely that's the interest rate that their central bank charges to the banks (which influences the interest rates banks pay/charge for savings/loans with them), not the interest rate that they are paying on their own government bonds? I'm not an expert, but I'm pretty sure those are two very different things.
They are separate things, but one type of bond is indexed by the interest rate (another is indexed by inflation and a third type is completely preindexed on a fix rate).
> Wouldn't that be a good reason to invest some money abroad?
Yes, and I intend to do that someday. It's not trivial to do, however, while investing in the boring funds I mentioned is extremely easy for anyone with a bank account, and investing in government bonds is as easy as investing in stock. In particular, for both the funds and government bonds the tax is paid automatically, while if you invest abroad, you have to do the calculations yourself, and from what I've read they are not as simple. Not to mention the extra cost and risk of opening an account outside your country; for instance, the Brazilian customer protection laws won't apply to an account outside the country, for obvious reasons. All in all, it's a lot more research to do, with the extra risk of investing outside your home jurisdiction, for a much smaller return, and the only benefit being reducing your exposition to your own government - one I'll be always exposed to, since I live here (it could easily impose taxes on capital held abroad, for instance).
> But surely that's the interest rate that their central bank charges to the banks (which influences the interest rates banks pay/charge for savings/loans with them), not the interest rate that they are paying on their own government bonds? I'm not an expert, but I'm pretty sure those are two very different things.
It's complicated, but basically the government sets the SELIC rate target, and buys/sells government bonds so the SELIC rate moves towards that target. The SELIC rate itself is the interest rate banks pay each other for a one-day loan with government bonds as the guarantee. Finally, one of the government bonds (the LFT) pays the principal ajusted by the SELIC rate at its term. There is also the pre-fixed government bonds (the LTN), which pays a fixed value but is bought for less, the inflation-indexed NTN-B, which I already mentioned, and a few others.
As for why increasing the interest rate helps control the inflation, that's one thing I still don't quite understand. I just know that the government does increase the interest rate when the inflation gets above the target.
That's not true for domestic currency bonds. There's no chance of default as a sovereign can always print more of it's own currency. Sovereign yields are driven by inflation expectations and what investors need to earn on excess of that.
Man alive. Here in the UK a five year treasury bond yields precisely nothing - potentially less than nothing. I have a mountain of cash and nothing to invest it in here. Even property doesn't present a meaningful yield any more.
It also doesn't look like it's going to get better, just worse - so as far as I can discern the best course of action is just to spend it before it becomes completely valueless. To stay ahead of inflation here I'd have to have a 10% yield at least - official CPI figures grievously underreport it, as the baskets of goods they use don't account for the shrink ray.
If you don't trust UK markets and gilts, it's easy to buy the same ETFs the Americans are buying (though you may pay a little more due to currency conversion). Vanguard also has non-UK ETFs denominated in GBP eg: https://www.google.com/finance?q=MUTF_GB%3AVANG_FTSE_DEV_5J6...
Actually, I ran an ecommerce platform and had a £3bn p.a. mixed basket of goods being sold on the platform. Since 2012 goods have increased in price by about 6% p.a.
To say there is nothing to see without looking at any data is ass-hattery.
6% p.a. - per annum. Before then it was more like 2-3% p.a.
It's subtle, but present - a big driving factor has been unavailability of credit, which forces smaller batches for fabrication, which drives up price. This has commensurately resulted in a whole host of businesses in turkey and china who specialise in short-order just-in-time manufacturing.
But either way, prices have increased far more than is immediately apparent, particularly food, garments and low value giftware. The pinch is a lot harder at the bottom than the top of the market, too.
I obsessed over this data for years, as it was the key to understanding where to position (I.e. Who's making margin?), which retailers would be risky clients, etc.
I was going to say this. It could even becomes a startup or consultancy business to support brazillian tech workers to build a fortune the same way the rich ppl do here.
12% sounds great but that's about how much the BRL has decreased against the dollar over the last five years. Just holding USD cash would have gotten you about the same returns.
In my experience, holding actual physical USD cash is a bad investment; older bills are worth less (exchanges will give you something like 10%-30% less for older bills, if they are accepted at all), so the longer you hold it, the less it's worth. On the other hand, there are funds which track the USD; see for instance http://www.bb.com.br/docs/pub/siteEsp/dtvm/dwn/inf04128893.p... . That fund had a return of 150% in the last 5 years; however, it had a return of -12.58% this year. The CDI had a return of only 64% in the last 5 years, but that's a consistent return, with no negative months. This year the CDI had a return of 12%, so if you had in January invested in a fund which tracks the CDI, you'd be way ahead of someone who invested in a fund which tracks the USD.
In other words: yes, investing in USD has a higher return, but that return also comes with a higher risk. I don't buy food with USD, I buy food with BRL, so the BRL is the one that matters here.
Instead of simply not accepting the bills, some places take a discount to offset the risk that they're fake. The older the bill, the greater the chance that it's a counterfeit.
Interesting, thanks for explaining. I thought it might be due to the risk of counterfeit, but I thought there must be some way of verifying still. Sounds like if there is, it's out of reach of many of the money changers.
You buy food in BRL yes, but when the BRL has a massive swing up or down food prices can swing the opposite way to compensate. If BRL drops 30% and food prices rise 30% you're going to be in a bad situation — dollars are likely to be far more stable
The packaging for every food has the manufacturing location printed on it, and almost every one I've seen is produced somewhere in Brazil, often in a nearby state. So, it's the opposite: the price for the food I buy has a greater chance of tracking the BRL than the USD. Fuel is also produced locally (by Petrobras).
And when the food prices do increase, consider that the food price is a big component of the inflation index, so both IPCA and later SELIC would rise to compensate.
The pain point is electronics. Almost all of it is imported, or has imported components. That one does tend to track the USD.
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[ 0.19 ms ] story [ 1408 ms ] threadHope to have it really pickup once done and turn profitable
https://leanpub.com/redux-book
I like the fact it can publish unfinished book. but I'm worried that it is not as big as amazon?
Once its done we will publish on Amazon as well (no exclusivity at leanpub)
Because leanpub allows paid user to download pdf and epub files. those can be easily shared.
whereas, on amazon, you probably could only distribute the work via kindle and printed (I'm not sure), without providing any shareable files?
I have written a number of books and the payout in increased networking with people who are into the same tech as I am, increased consulting business, etc. is awesome. I also make decent passive income from writing, but that is a secondary objective.
I'm going to end up LOSING MONEY as many of LC's loans are going delinquent.
Joy.
http://www.nilsenlabs.com
None of them have made a lot of money, but one is still generating a small amount. Guess which. Hint: Income is not proportional with the shinyness of the technology stack
I launched it a few months ago and have a few smaller subscribers with a handful of larger subscribers.
https://zonewatcher.com
Made $104,000 in revenue since June (turns out the user acquisition stuff actually works), about 87k of which is profit, so we'll say ~$11,000/month part-time. It still makes me a solid $2,000/month now with zero work, and hopefully more once the book is officially published. (It's done and delivered to backers, but won't be on bookshelves and Amazon until after it's typeset.)
https://www.indiegogo.com/projects/the-ultimate-growth-hacki...
I know the marketing will be over-the-top for HN. Just know it sells because the content is really, really good.
Tell anyone how much you made with your own tipps without proof/proof of your specific case and use it to sell it
And why assume the other is lying? This Ask HN is specifically about passive income, and calls for people to share their profits. It's not about them posting their IRS returns or other proof. If you're gonna doubt them, might as well skip the whole post.
At worse, what you describe is a snake oil sale.
But people can genuinely learn things from this or from Tim Ferris work too, so it's more like any self-help book/product sale basically. As long as it contains useful stuff that the buyer didn't know before on their own, it's legit for me.
Of course if the content is good, it still relies on the determination of those applying it. And some luck besides.
A book is a perfect example of that.
The prime example of passive income used here is patio11's Bingo Card Creator.
One also could say that in traditional investing, the upfront work is the research work to find right index funds or buying property in real estate investing. They might be less work than writing a book, but revenues e.g. from passive index fund investing are also significantly less than from writing a book, if your starting capital is small.
This is the key point. In absolutes there is no such thing as passive income. Anything will take at least 1s of effort, and $0.001 of capital. The spirit of the term, is income that is heavily skewed towards being generated from assets rather than effort.
A new book is the edge case. While making money off IP is generally the perfect example of passive income. Quitting a job to become an author, is not. There is an implied lack of effort and cost in the question. Additionally, and importantly, there needs to be a sense of "free" in there.
The prototypical case:
- [bust your ass at work] >> [get evened out with paycheck] >> ["free!" passive income from savings]
New book case:
- [bust your ass writing] >> [nothing, world still owes you] >> ["free?" passive income from book IP]
Until the "nothing" gets filled in with the equivalent of a salaried wage, I'm not a fan of calling it "passive income".
Would you also consider creating a static "how to" site that generates revenue from ads to not be passive income? I think that's the most basic example of what HN considers passive.
We're just defining words here anyway. I think a core component of what people think of when they think "passive income" is making a disproportional amount of income relative to effort put in. Until those proportions get dis'ed, you're just working at a sub-optimal job.
If spamming all of twitter in alphabetical order is an example of the growth hacks....
I see the account he used to do most of the spamming has been suspended by Twitter now https://twitter.com/vdignan
Yep. And like Floyd Mayweather said, "Skills pay the Bills." Like it or not, Mr Vincent Dugnan is very skilled at making 11,000 / month spamming on twitter and social networks. So that's that.
I hope the startup didn't fail because it couldn't attract users?
Can you answer me a quick question? I notice you use the Twitter widget/embed on Grasswire. How do you like it?
I've always felt it was kind of redundant to show the same content that's already on the site. The reason why I'm asking is because while doing my "due diligence" about blogging/bloggers (our target market after the pivot), I've noticed that a solid 10-15% of all blogs use it (or a similar widget from Pinterest or FB). I can see how they CAN be useful, but the fact that they are mostly "consumption only" and mostly curated by one person, means that there is a lot of room to improve them, which is exactly what we're trying to do with our community platform. I'd love to partner up/work together and join forces in some way. Let me know!
Honestly Grasswire is now entirely open sourced/crowdsourced and I haven't touched it in the past ~year or so, so I haven't really been involved in that decision making process and don't have a strong opinion.
I don't really run Grasswire, it's kind of an open collective community, so you can convince people to participate but we can't really "partner" with anyone easily.
But than I found another tab in the utterly shitty admin panel and it hit me like a rock. The numbers on the dashboard were a monthly overview and in fact we earned already hundreds of dollars and downloads in just a few days. I went back to the computer, but together an even better watch face, set it to 1$ again and watched it selling like hotcakes.
However it tried out quite quickly after that. People started to copy stuff and giving it away for free and I never bought the watch myself, I just used the emulator to test my apps. So I took them out of the store at the end because dealing with taxes and sharing the income does not make it worth it if you get support requests like "how can I change the time on my watch", "what do I care, its your shitty watch and Samsung's shitty interface"... So yea. That's my best story about unexpected passive income. Selling stuff fast on a new platform seem to work!
Edit: Found some screens. First one: https://i.imgur.com/TIVsPKO.png Best selling one: https://i.imgur.com/9L8TetO.png
[Somewhat related: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-sim... ]
All the code is in the same repository as R Markdown.
SPY / VFIAX / S&P 500 has a CAGR 4.9% from Nov 2000 to Nov 2016.
"The average 30-year rolling total return for the S&P 500 starting with 1926, is 2,478% or 11.21% annualized (geometric mean). There were several 30-year periods that had annual returns between 8% and 10%."
Having said so, past returns don't guarantee anything for the future. They might give you an indication though.
[1]: http://allfinancialmatters.com/2012/08/29/sp-rolling-total-r...
Edit: Here's [2] a better (?) graph of the S&P 500 with the 30 year rolling returns, inflation adjusted and dividends reinvested. Source[3]
[2]: http://imgur.com/Ja1xOcA [3]: http://redd.it/3fsdex
Passive investing when you have many years before retirement means you worry about long term trends rather than short term risks.
Whereas (more seriously) investing in "more stable" things like bonds forces you to pay a premium, because every man and his dog has desperately been chasing stability, safety, yield, etc since 2008, in many cases using quantitatively eased money to do so.
When a thread takes a turn for the worse, please don't reply unless you can make it better, not worse still. Political name-calling makes it worse still.
Since I had to ask you to keep partisan politics out of HN threads only a couple days ago, I'd like to emphasize the point. This is not what Hacker News is for. Please (re)-read:
https://news.ycombinator.com/newsguidelines.html
https://news.ycombinator.com/newswelcome.html
Just beware of taxes.
https://www.charles-stanley-direct.co.uk/ is a good shout, but there may be better depending on how you'd like to invest.
Is there a value add that I'm missing?
http://www.hl.co.uk/funds/index-tracker-funds/wealth-150
For example, that provides the FTSE all-share through an L&G fund:
http://www.hl.co.uk/funds/fund-discounts,-prices--and--facts...
Which has fractionally lower fees than the Vanguard equivalent:
http://www.hl.co.uk/funds/fund-discounts,-prices--and--facts...
Anyway, since you're in Europe, curious why you chose this fund (S&P 500) over something with more exposure outside the US?
[1]: https://www.vanguard.nl/portal/instl/nl/en/product.html#/fun...
Do Germans not have any practical way to invest in accumulating funds?
If your ETF is "ausländisch thesaurierend" ("foreign accumulating"), declaring it will be a bit more complicated but not that hard. Would you mind explaining your situation a bit better? Maybe I'm missing something (and I wouldn't want to, since I'm looking into this topic myself at the moment).
For non-EU/US residents I got a recommendation for http://int.tddirectinvesting.com/
Basically, the change is already priced-in and you shouldn't worry about timing the market. Buy and hold.
You should get inflation + some economic growth + risk premium for holding equity.
I didn't mention any numbers. If economic growth is low, and inflation is non-existent, you will not approach 7%.
>Why are banks struggling to get even 2% return on their investment
Where do you get that information?
I encourage you to read up on this, but someone else with more knowledge should recommend some books.
https://investor.vanguard.com/mutual-funds/lifestrategy/#/
Don't attempt to beat the market. The market cannot be beat (many examples in the book). Invest in index funds long term which is the right mix of risk/reward for most people.
It does have a chart in the back which tracks your age and situation. For example as you approach retirement you should start to liquidate your funds and buy government bonds so you aren't hit by a bad year when you have to start drawing on your investments.
It did convince me. I opened accounts with Wealthsimple and Questrade the next day.
A great site for fellow Canadians is http://canadiancouchpotato.com/ - you can skip the book.
OP's point is (most likely) that you can't buy them directly from Vanguard (i.e. using an account on www.vanguardcanada.ca) but will have to buy them using a broker (e.g. Questrade.)
It's crazy there is this giant industry of overpaid people that exists only because people don't listen to that advice.
Disclaimer: I work in said industry.
I really would like to believe this, but please explain to me how then how firms like Renaissance can exist ... Not sure whether it's relevant but I'll add that I'm an economics PhD student.
https://upload.wikimedia.org/wikipedia/commons/e/ec/LTCM.png
The market cannot be beat by 99.9% of professional investors spending all their time day and night trying and with a team of people helping them.
I'm calling your bluff on you being an econ PhD student or maybe you have been one for a month or two at most...? If you are an econ grad student you know what RenTec is doing more or less. At least in theory if not specifics, people talk and there's plenty of econ papers explaining what's underneath major quant strategies.
People need to chill bringing up RenTec when finance comes up (Buffett too). Just like they need to chill bringing up Facebook when talking about startup valuations. Outliers are outliers.
There are pretty much no econ papers that would describe what happens inside the high end systematic firms. (Source: I work in the industry)
Bringing up the outliers is a perfect counterexample when wild sweeping statements are made. These are not even real outliers, they are valid samples.
>The market cannot be beat by 99.9% of professional investors spending all their time day and night trying and with a team of people helping them.
Professional investors pretty consistently beat the market. But not the ones that you see. The louder someone markets their fund, the more likely it is to be a scam. Your sample is of guys who heavily promote their fund and make money from management fees not performance.
The best managers aren't even made visible to you. Why would you attract attention to what you're doing if you have a good thing going?
I'm not familiar with this term, would you mind giving me a general description of what kind of investing these firms take part in?
When the funds portfolio is decided based on a system your fund is systematic. It's an important distinction.
Professional investors are not pretty consistently beating the market...secular! Anyone can have a good year or two.
I'm not talking about dudes talking their book on CNBC. Yes there are shops that beat the market, but if you have beaten the market 5 years in a row, you can't keep it a secret even if you want to.
Why would you promote your fund, if you have all the FUM you need? If you are doing well, why would you tell people about it? It is funny that your position is because you haven't seen it, it doesn't exist.
You don't have to answer but your questions are odd for someone with experience in the industry. But let's get into it:
How is performance made public? The same way people know what "stealth" startups are doing. Sometimes a document leaks and sometimes people talk. Usually both. Let's just say a manager is super secretive. Do you know how many people in the chain know performance anyway... Current and former employees. Current and former recruiters of these employees. Current and former clients. Current and former consultants to those clients. etc... And you're saying all these people also don't have that human urge to brag about these rock stars of the investment world? OK.
Even if that were the case, everyone has a cousin at State Street or HSBC, these people take coffee breaks and love to gossip performance and secrets breakdown there.
This is like Fermi's paradox. If all these funds out there are beating the market, then where the hell are they??
All of the funds beating the market are secretive and successfully secretive? For decades?
If it was as common as you imply there should be more of them known to the public by choice or by accident. That is logic.
Don't be the guy who mortgages his house to buy Herbalife products and tells his wife this is your year.
The comment above said 99.9% are not beating the market. There are thousands of funds out there. All funds are filing Form ADV's now...We know who exists. So yes there's a few people who do beat the market. Those 3 Russian guys in Texas and that story about the MIT PhD's working out of a house outside Miami and so yes, there's a few examples out there. Dinky family offices don't count. But no, there's a not a bunch of professional investors with serious weight under management and outside clients beating the market over a secular horizon.
There's a handful, and if you are at one of them congrats to you. But to come on a forum saying there's a bunch of professional investors beating the market, they just all happen to super secretive billionaires and they don't tell anyone about it. That's misleading. That's tech back office got your info from a e-book kinda talk. And it would be at odds with your original thesis that folks that beat the market are secretive and don't talk. So it makes me think you don't work at one, you just want to believe they exist. But again if you do work at one, congrats. Are you hiring? DM me.
So where are they?
https://en.wikipedia.org/wiki/Fermi_paradox
Thus, an average investor is a lot better off with an index fund instead of trying to pick individual stocks. (Funds like Renaissance's Medallion simply aren't available to people without tens of millions of dollars to throw around, too.)
When most people say Rentec they think Medallion, which while being spectacularly profitable over 20+ years, is now a closed fund only open to current employees last I heard.
You can start one of those firms; in all likelihood, not all the potential profit has been extracted yet. You can hire a bunch of smart mathematicians and/or smart technologists, and spend time working on the problem. And then you'll be in good shape to beat the market. If you're an econ Ph.D. student hanging out on Hacker News, you're already well on your way to doing this with your life, if that's what you want to focus your life on!
But "you", the person with an unrelated day job fiddling with some investing app on your phone in your spare time, starting with a relatively small amount of capital compared to Renaissance's first year, and relatively small risk tolerance compared to Renaissance's first year, and definitely not enough money to hire a bunch of scientists full-time - "you" who's asking on a thread about passive income instead of lifelong career options - you are statistically unlikely to beat the market. That's what people mean by "You can't beat the market."
It's a simple fallacy most people with a statistics background understand, but the average journalist doesn't.
Saying you can't beat the market, is like saying you can't win at boxing, because on average nobody wins (there's always a winner for every loser).. but I would put my money on Mike Tyson in his prime.
Your expected value for investing across the market, will roughly converge to the market because of diversification. ~20 funds will start to approximate the underlying universe of stocks, because the range of views of the fund will be across all of them. All of the alpha will be evened out into beta.
So after fees - you would be better just investing in an index than a basket of funds. But there is dependence, a good fund is consistently a good fund. So if you get a chance, it's much better to invest in a good fund.
But the best funds aren't accessible to the public, so the public doesn't get to understand the market for what it really is. And there's a lot of shit ones that market heavily to the public.
There is also a populist idea to the notion that indexes beat hedge funds etc, it makes the average person feel good to think the top investors are no better than they are. So why would journalists peddle the true narrative?
Two reasons you can't replicate this - 'you' aren't a team of super top notch mathematicians with decades of data, and even if you had an exact copy of their trading strategies, you don't have the capital to make the transaction costs, etc, worth it.
Can't speak to the tool itself, but the site design and overall aesthetic looks gorgeous..
On average, and when bench-marked against itself taking into account fees. There are funds that consistently beat the market, that you should put money into over the index if given the chance.
But your general notion that the average person shouldn't try is a good one. At the end of the day you have to earn money because you took it from someone else. To think that there is a dollar for everyone is to ignore this simple truth.
You see it as a problem, if you are used to the idea of earning money instead of taking money I get that angle. But to investors it's not a problem but a fact of life.
Dead practical advice despite the somewhat sleazy writing style (see title of book).
any hacker can, in the next ten minutes, cause their CPU to do more arithmetic than the arithmetic (explicitly adding 2+5, and so forth, multiplying two numbers in their heads) that every single person has done in the history of humanity. okay, but that's just numbers.
Today we live in a connected world where 2,000,000,000 people can be reached in any eight-hour period of time.
Any hacker can find any niche and make a product that will be the first search result within it (by being the first; making something that doesn't exist; and telling people).
Why save a salary, when you can create a business, create value, and scale to the entire Internet and give people some benefit?
Every hacker should start one or several businesses. While it may not exactly be a moral obligation, this brings humanity forward.
EDIT to clarify: I am disagreeing with the suggestion that hackers should save all or most of their money - (put in my parent comment as "save as much of your salary as you can") -- rather than saving it, they should invest it into their businesses, adwords to grow it, other advertising and business development expenses, hiring, etc.
I don't think there's anything wrong with saving or with passive investments. But it shouldn't be as much as you can. Engineers have other very good uses of their money, which I outlined.
As software systems grow they turn into complex systems. They become embedded in the processes of the end users, while requiring constant boring work to remain alive.
I fail to see how this maintenance work is less worthwhile than developing new tools. Any complex task requires decades and decades of labour.
This is not to say that identifying niches that benefit from established tecnhinques and require only some domain specific customization would not also be wortwhile.
But claiming "everybody should find such a niche and become entrepreneurs" is quite bit too much. My mental energy is used in my daily work which brings added value to my orgs and our clients. The benefits of this are enormous - I can focus on deep, technically complex work while outsourcing payroll, taxes, liabilities etc. to my employer.
Effectively, I don't think many people can do deep work and become an entrepreneur at the same time. Also, expert skills in one domnain are no guarantee in some other. Star software engineers can turn up shit or stellar business operatives.
I think you are covering the software engineer in some weird halo of infallibility.
That said, I do have enormous respect for people who have created new businesses. But it hardly is the only way to bring in value.
This is how you end up at conferences where everyone you talk to is the CEO, but nobody is actually making any money (or, in large part, actually doing any business).
I also love entrepreneurship, but it is not, nor should it be, for everyone.
I guess my objection was to the idea of saving "as much as possible." I don't mean to imply that you shouldn't work for a salary: but you should take some of that salary and spend it on actively building or backing businesses, not just passively.
Based on your background I think you would be amazed how much business you could create by investing in/overseeing a developer in India or China, for example. Your knowledge/background + $5000 goes waaaaaay farther than you think. (regardless of who the owner ends up.)
To me this is the opposite of the advice to passively save as much as possible!
[1] I corrected the spelling of this word - I mispelled it before too.
Active investment is highly context sensitive. I'm not denying someone might be plausibly in a position with sufficient information, domain knowledge, connections and a small amount of capital to operate as you suggested.
Your claim that operating on this manner is the obvious best choice for everyone is highly controversial. For starters, private investment requires trust and communication and just the culture barrier to understand the true rules of business and engagement are non-trivial for someone who's native culture is for example northern european.
Basically, I'm totally clueless. I have no idea how to a) hire an indian software dev for a few thousands b) what value added activity I should require of them and c) to whom to sell their work to.
I do know, however, how to invest into low cost index funds with reputable finance organizations. Thus the latter from economic perspective is a highly more enticing option.
I presume you have some specific situation in mind. Perhaps you could give some 'hypothetical' scenarios and what their profit model is?
I do like programming, and I plan to spend my productive time on this Earth programming on projects that interest me and help humanity in some way, but I just absolutely 100% have no plans to start a business. I admire your excitement about the idea, but I think that maybe not everyone feels the same way :)
(I also recognize that maybe not everyone feels that automatically saving+investing as much of your income as possible is a good idea - I'm mainly attempting to reach those folks who do think it's a good idea and just need a little bit of prodding to actually set it up.)
"Saving it" here is not hiding it under the mattress. Buying stocks is literally investing it, only into other people's businesses. Buying corporate bonds is lending it to other people's businesses so they can grow. And investments into existing established businesses could easily be argued to have at least as large a potential impact as starting out on your own with a minor project that is more likely to fail than not.
Risk tolerance.
If, for whatever reason, my business doesn't turn as much of a profit as I'd hope, and I've spent everything I could on it, I'm in an awful position: both as a person who needs to keep a roof over my head, and as someone hoping to do good things for humanity. If I'm on the verge of bringing humanity miles forward, and fail, I've done less good than if I reliably brought humanity a few inches forward.
On the other hand, if I do save my salary up, I can choose at some later point to spend all of my time and energy on something cool, and keep spending that time and energy until something happens, because now my risk tolerance is much higher. And then it's much more likely I will bring humanity forward by the miles I wanted to.
How does starting a business bring humanity forward? Maybe I'm just pessimistic but as far as I can tell the pursuit of money largely just ruins things.
I would think that a "hacker" would make things just because they can and enjoy it, without concern for things like profits or market value. Indeed weren't the very first hackers amateurs and not professionals, in the literal sense?
I'm not saying that people should just forego money completely of course, as I am just as guilty of anyone of wanting more money. I just don't understand why "every hacker should start one or several businesses." if we're solely concerned about humanity.
On the other hand, the implicit question of the post was "what did you create to generate passive income" (it's called "Hacker" News, not "Invester/Banker" News).
It depends on how well you manage the present. Aiming towards some perfect idyllic scenario in the future is not always so wise. It depends on how you manage that particular present you have crafted for yourself in the future.
Also: Why isn't interest income considered passive income to you? "The fundamentals" are there for a reason, after all.
Your second point is absolutely correct, but I still think that my comment answers the root question - how did you set things up such that you're automatically being given money for free on a regular basis? - in a way that is simple, requires very little effort, and has a very good chance of working for many people who are able to try it.
As per how to open a brokerage account for alien non US resident, several years ago I managed to open an account at interactive broker while living in hong kong. They have among the lowest fees of all brokers and good software. Pretty sure its also possible to open an account while residing in france.
One thing to note though: as an alien non US resident, any US dividends will be taxed at 30pct in the US, directly deducted by the brokerage company
https://www.irs.gov/uac/form-w-8ben-certificate-of-foreign-s...
https://us.etrade.com/e/t/estation/contexthelp?id=1202010000
Open an ETRADE Securities account if I'm neither a legal resident of the U.S. nor a U.S. citizen You won't be able to open a brokerage account online if you are not a legal resident or citizen of the United States because we will need some additional documentation from you. If you're not sure if you're a legal resident, see the Help topic Determine my residency status. Request a brokerage account application by mail, or download it from our Forms & Applications page. Download a Form W-8BEN. Complete sections 1 through 6 of the application (the section on options trading isn't required). Send your completed application and Form W-8BEN, along with your initial deposit and any supporting documentation, to us at: By regular U.S. mail ETRADE Securities LLC PO Box 484 Jersey City, NJ 07303 - 0484
By overnight mail E*TRADE Securities LLC Harborside Financial Center 501 Plaza 2 34 Exchange Place Jersey City, NJ 07311 1-800-ETRADE-1
Why? Surely investing in a higher growth economy is better?
As for tax-efficient ways, my french isn't that good so I don't know the details but if I understand this topic [2] correctly you should have some options like PEA, PERCO/PERP, and/or PEE/PEI/PEG
N.B.: There will always be some discussion around this specific broker because their 'default account' contains a clause where this broker is allowed to temporarily loan your assets to other customers. Don't do this. You can get a so-called 'custody account' (which is basically a regular brokerage account) that's only marginally more expensive.
[1]: https://www.degiro.fr [2]: http://redd.it/3oht1m/
I told the accountant, who I always found watching CNBC in the break room and I suspect still dreamed of being a day-trader, that the best investment I ever made was our company's ESPP (Employee Stock Purchase Plan).
He said, "You know what? Same here."
(Standard disclaimer: max out your 401(k)/IRA contributions, first.)
Your income, your 401k match, and your ESPP are all tied to your employer, so as long as things are good, ESPPs can be a great way to make easy money, but if things take a stark downturn, you can find yourself with ESPP you lost money on, a slouching 401k, and no job. The chances of that happening are fairly low, but still something that makes me a little uncomfortable about ESPPs.
Obviously your advice to max our 401k/IRA contributions first should mitigate a lot of this, but I think it's important to mention the risk too since there's a certain temptation for younger engineers who think it sounds like easy money and don't realize the full implications of it.
Minor quibble. Your 401k plan almost always has more fees than index funds at someplace like Vanguard.
1. Contribute to your 401k to get your entire company match.
2. Then max out an IRA, a Roth IRA, or a combination of the two based on your income level.
3. Only then continue to max out your 401k.
https://i.imgur.com/1rPEkGQ.png
This is certainly not true for all companies. I lost over $100K due to our Employee Stock being driven into the ground over the course of a decade by a CEO and board who had loose ethics and no business running a company.
My advice is, before investing in you're ESPP (or Employee Stock Ownership Plan - ESOP), even if you're surrounded by exceptional talent, take a close look at your corporate leadership before purchasing. If they seem sleezy and disingenuous, they probably are and it may be 10 years before you realize you've been totally screwed.
Probably don't do this (use taxable investment accounts) unless you have at least 15% going to your tax-advantaged retirement account(s).
Saving tax while something grows is great, unless you need that cash sooner. Then it is not too helpful. I wish there were a tax advantaged vehicle to use for setting aside money for a home.
So yes, definitely invest in tax advantaged accounts, but do so with a solid understanding of your expected financial needs as best you can model for the next 5-10 years. If you need access to that money sooner, what you'd lose on tax may be worth the flexibility of having those investments somewhere more easily liquidated.
[1] https://www.irs.gov/publications/p590b/ch02.html
EVERY contribution you make to a Roth IRA/401k can be pulled out, tax-free, at any time for any reason. It's the earnings you have to be careful about. But for example if you have contributed $20k to your Roth IRA or Roth 401k, and it is now worth $35k, then you can pull out $20k at any time for any reason, while for the other $15k you have to wait until 59 1/2, or use SEP withdraws, etc.
In addition, for a first-time home purchase you can pull out up to $10k without penalty (but with normal income tax applied) from a traditional IRA or 401k.
My blog post about financial independence: http://mays.co/why-financial-independence/
That is already passed the 4% withdrawal rate (can take out 4% every year and never decrease the principle), which is 25x annual spending in savings/investments.
http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need...
That said...there are many funds like them, those in particular are 3x leveraged crude oil ETF's. That means if the price of oil rises 1%, UWTI rises 3%. If it falls 1%, DWTI rises 3%. Crude oil as a market has "predictable volatility", that (simply) means that within a given day, the price will rise/fall repeatedly within a sane range(given no extraordinary circumstances). Identify this range, and buy and sell on both sides(short and long) to take advantage of the range. Follow the big money(banks), and you'll be just fine. Never go against the flow, you will (virtually) always lose.
Before you jump into 2x or 3x, you should be able to reliably generate returns from a non-leveraged ETF tracking the same commodity.
Lets say UWTI is trading at 100 today. Oil is trading at 50.
Day1: Oil falls 47.5 (5% drop). UWTI will fall to -> 100 * ( 1 - 3 * 0.05) = 85
Day2: Oil rises back to 50 (5.26 % rise). UWTI will rise to -> 85 (1+ 3 * 0.0526) = 98.42
So even though oil price recovered, you lost $1.58. Over a period of time, rise and fall in oil prices corrodes the value of UWTI & DWTI (and similar leveraged ETFs)
>which are wealth appropriating not wealth creating
Literally everything anyone buys is paid for by a portion of their wealth, not sure what you are trying to say here.
Quite simply people have figured out it's a rigged game and are piling in, hence the asset bubble and the fallout effecting an entire generation, which perhaps you missed.
I'm not really interested in discussing this with you either as just pointing out things are paid for is just taking the existing system without any question as "correct".
If everyone was a landlord, then that would be a pretty bad investment now would it?
What does this even mean? He is providing a good/service, and people are willing to pay him for that good/service. He's not living off the pain and suffering of others...
For my Indian friends here (or people interested in investing in the Indian market), I'd suggest http://scripbox.com (no affiliation, just a happy customer).
I started a year ago when I was 25, and am glad I started this early(-ish).
Doing it for charitable reasons is fine, but it's not a great way to make money IMO.
p2p lending is hit or miss for me: 3-10%
Index funds pull in the rest.
I've also moved temporarily to a very cheap COL country so that I can focus on some more side projects to pull in extra sources of income before I return to the work force.
In an index fund, the stocks contained in the index will on average pay out a certain dividend and turn a certain profit that isn't squandered on worthless projects.
This last part is what makes stocks increase in market value long-term, and which also makes it reasonable to sell a small proportion of your shares every year as a passive income.
If the dividends and your sales constitute less than 3-4% of your funds' total market value each year, you can expect your portfolio not to decrease in value long-term.
You're totally missing my point. I'm saying, even if your stock is "worth" $1 trillion, if you don't actually ever sell it, you haven't earned a single penny from it. It's only money when it's actually money. So my question was whether the OP was ever selling the stock or not.
Stocks in major corporations are generally considered a liquid asset - i.e., they can be easily converted to cash. [1]
Don't confuse liquidity and risk exposure. The money is still subject to the risk of the market when it's still being held in stocks, but it's approximately as good as money.
[1] http://www.investopedia.com/terms/l/liquidasset.asp
Investments that pay dividends aren't as good for individuals since the dividends are taxes at ordinary rates.
I don't understand what that means. Whom would you be borrowing from? Where would the cash be coming from?
In Sofia, I'm in the capital. There's lifestyle necessities like grocery stores, fast internet, etc. Plus I won't need a car because of the excellent metro. If I want to catch an American movie or a show, there are malls/theatres. It really has just about everything I need.
It also helps that my wife is Bulgarian.
We started a small online shop about 10 years ago, and it's mostly automated. About 5 minutes/day + one week / year of work.
Before that, I had spent a few years (trying to) run rather big software projects (for me – I was 18 or 19). They had cost me so many sleepless nights that I swore to never again take on customers paying me more than 100 Euro each. Now, if anybody complains, or gets on my nerves, they get their money back and are never heard from again.
My friends joke I'm the living example for an unconditional basic income. They haven't decided on the outcome yet, though.
[1] http://amzn.to/2hcfuB7 - Work Less to Live Your Dreams
Have been thinking about this for awhile and haven't settled on the right topic yet!
[1] theroadchoseme.com
[2] @theroadchoseme on FB/Instagram/YouTube
Most of my other sites are more on $50 - $200/year too :/
The only "secret" other than user generated content (what makes it actually passive) for me is to never stop trying. I have like 50 in use domains right now, many which i did not extend because they did not pay for themself after a year.
How do you source your user generated content? Is the big earner a forum or the like? I'd kind of envisioned some kind of static sites with ads.
Have you taken a noticeable hit like others in this thread from diminishing ad revenue and rates?
Its more like a forum, but not one. Users can post their own content and others can vote and comment that. Plus it has a huge searchable database.
The problem with static sites (i have those too) is that google loves site updates as often as possible. A site that is good ranked today can be killed by a more dynamic one next day.
http://getoptimage.com
Released this week. Came unnoticed on HN but somehow got featured on PH. 1200+ downloads of free version and a few sales.
Not sure if that'll change. In that case, the best of 2016 will be one of the plugins for Sketch https://news.ycombinator.com/item?id=12319286.
Sorry if this isn't in your wheelhouse or it's inappropriate to ask in a HN comment.
Source: http://blog.devtool.com.ar/2012/04/how-does-pornhub-use-redi...
https://github.com/ImageOptim/ImageOptim
Also are you going to support and fix the frequent bugs that png optimizers run into with esoteric color space/alpha combinations beyond the best effort...?
Optimage can do automatic lossy (visually lossless) optimizations on JPEGs and PNGs. It means you don't have to manually tune JPEG quality for each image and can get some PNGs quantized to 256 colors if visual differences are negligible.
It uses a modified quality metric based on Contrast Sensitivity Function (CSF) and contrast masking of DCT coefficients for JPEGs, and a custom one for color-quantized PNGs (major difference is sensitivity to noticeable gradients).
Optimage has a lot of tweaks to compression algorithms to squeeze some more bytes (Pareto principle here). But much more bytes are saved by exhaustively trying all possible image data representations, e.g. fast brute forcing of PNG delta filters, dirty alpha, palette sorting.
There's a good PNG test corpus at http://css-ig.net/images/png-test-corpus/png-test-corpus-201.... Optimage – 276 058 bytes, ImageOptim – 297 561 bytes. But this is just a lossless test.
> Also are you going to support and fix the frequent bugs that png optimizers run into with esoteric color space/alpha combinations beyond the best effort...?
At some stage, yes. Right now I'm focused on things like losslessly rotating JPEGs according to Orientation meta in Exif, adding CMYK to RGB convertion when Convert to sRGB is ON, supporting container formats like ICO and ICNS, more tweaks to compressors for performance and smaller output, GUI improvements, etc.
May I ask what percentage of sales did you get?
I'm going to launch my product soon, and I'd like to know what I can expect.
I have some performance updates planned making it 2-3 times faster. Probably worth waiting.
Email is in the HN profile.
But thanks for your feedback. I have a couple of ideas how to make it more clear.
Perhaps it's Trump Trumps? If not, it should be. Or presidential candidate trumps; Trump trumps all?
Didn't do any work on marketing really so it is pretty much passive, but I think with a bit of work they could both do a lot better. It's a very seasonal market - we only get customers for about 3 months per year (the 3 months leading up to the exams), so thinking of branching out into other exams that occur during other times of the year so the income is a bit more steady.
https://thecssworkshop.com/
Interestingly it has been very popular with teams (so selling a set of licenses so a whole team of developers can use the material). I also teach the same material in person (either in-house or in open workshops) so I'm keeping the two in sync. I made some notes about that process on my blog: https://rachelandrew.co.uk/archives/2016/06/03/creating-an-e...
I intend to do a bit more marketing of both the in-person and online training in the new year.
As an independent (not working for a browser vendor) invited expert to the CSS Working Group, training and offering this course is really how I can fund doing that.
https://grabaperch.com https://shop.perchcms.com
I am currently putting together an online course and I am still undecided on the easiest method of delivery.
Later, company rules changed and I stopped actively promoting it, but second level referrals still are generating 5-10k year with doing absolutely nothing of work.
I'm now considering doing this again in 2017. Hopefully interest rates will remain as low as they have been in order to lock-in an attractive mortgage.
Brexit, Trump, EU sentiment, China trying to deal with their own problems, they're all pointing to the same way: devalued currencies. Where they start, rising interest start to follow.
I'd also be wary of assuming commercial real estate was a lock-in. I've heard horror stories.
I'm glad it's working for you right now, I'm just saying: make sure you tread carefully and have done your research before you start gearing up.
But you're right, the OP definitely needs to tread lightly with property and the contracts. The devil is always in the details.
Now sure there are a number of people who don't report and those who wish to work more. But I don't think it's going to be easy to get those people back into work. Most are either in industries that are disappearing due to automation. Or they lack the skills/training to re-educate themselves.
And without tariffs (which will impact exports) there is little chance of US being all that competitive in most industries that compete with Asia (I assume you actually mean China).
That's close to 10 million people who have stopped looking for jobs who we would otherwise expect to have them.
http://www.econtalk.org/archives/2016/11/erik_hurst_on_w.htm...
http://qz.com/286213/the-chart-obama-haters-love-most-and-th...
(clickbaity headline, but the contents seem sound)
https://fred.stlouisfed.org/graph/?g=4CRu
I don't understand why you say "tread carefully"... when it's the bank bearing all the IRS cost. Plot any LIBOR curve, and you'll see that the bank is the one to lose here. Banks are fighting for customers, and cheap loans and mortgages is the game they are playing. I could go into more detail, but given that I have a 12 month DSRA account in place, I'm quite happy with the investment.
I guess we have different views on how we perceive risk. But that is ok.
Reality: others work hard and get less so rentiers can kick back.
or, like you are implying, I shouldn't have saved any money, and spent it all... fancy cars, exotic vacations, and parties. I guess I gave up one lifestyle to reach another one. We all have different priorities.
I think right now we have a situation were money makes money and selling your labour doesn't, in the average case not in the "I'm a senior engineer at google" case.
I just don't see how this ends well. Workers struggling to get wage rises at all and yet 5% per anum return for those with capital. We've just had Trump and yet here everyone is basically saying "I can get further ahead by playing the system".
It's not looking good.
Many companies, large multinationals to small startups don't want to OWN property. It's capital intensive for them, they want to rent. Does Starbucks own its coffee shops? No. Can't you see how renting property is a service to many?
Stop being apocalyptic simply because someone owns property. Take a chill pill.
We've just had Trump because some people are feeling very left behind. I'm not saying you caused Trump, but I think the system that incorporates rent seeking through land is a big part of it.
Land prices are all consuming, they are taking wages from workers and then rent from net wages of workers. The system as it stands is very efficient at adjusting credit to soak up any gains into banking and land speculators.
What was your downpayment? Asking because I tried to do the same thing earlier this year. Thought I was clever, did the math on how much I can rent out an apt on AirBnB, and what the mortgage would be on 30 year fixed, and my calcs said I need to put only 5% down to break-even. Then I contact lender and turns out, for Investment properties, they require minimum of 25% to 35% cash as downpayment. They said this was to hedge their risks against a borrower who would bail easily if an investment property goes south.
Any way around this? i.e. around not having to put 25% down on investment RE?
They are making some nice money each year, but the trend is quite clear: given same traffic I am making about 50% less each year. Ad revenue is way down (more adblock users, less money per click, CTR is down), but paid premium plans are balancing it a bit.
These projects are still my biggest passive income stream, but they are going to die in few years. Other than that I am owning agriculture land (that I am renting), rental property and portfolio of p2p loans.
Those traditional assets are much more expensive to acquire, but then the yield is much predictable and stable. Still, the tech projects are my best source of income considering the amount of money/time required to create it.
Which site are you using if I may ask? And what is your idea of short time in this context?
What I see is that quality of loans go down as a platform scale and I am lucky to be with this platform from the start. So my cohort is made up of mostly early adopters. I am year in my portfolio with 0 defaulted loans and 1 late payment (I feel like this loan will default during the lifetime).
My strategy is to invest to nonconsumer debt (no car loans, no holiday or Christmas presents loans or loan refinancing). I am investing in loans with disclosed profession (investing in IT professionals, govt workers, school teachers...) and with disclosed loan history (aiming to people with 0 debt). I want the loans to be paid in 3 or 4 years. I do break my rules for about 5% of portfolio that goes to riskier loans, this is where I get majority of my yield, otherwise my yield would be like 4 or 5% instead of 7 - 8%.
I guess this strategy is not applicable in US or UK, where is normal to have some debt (there is/was very different debt culture in most EU), and even here is still harder to discover these good loans, so I basically stopped investing in there.
Next year I want to start experimenting with b2b loans for unpaid invoices (business sell their new invoices with terms like NET30 or NET90 to boost their cashflow).
https://helpmanual.io
Well, parent posted it here and got you interested!
I'm kind of relying on Google to list it organically as man pages are something people search for a lot.
Hyperlinks and the "referenced by" section are pretty neat.
By "Google" I presume you mean online indexes of man pages E.g. This site.
The other man pages sites are ugly, old and incomplete, despite that done of them rank pretty high on Alexa. I built this site to end up smarter, more modern, easier to use and more complete. Still a work in progress atm.
One suggestion: how about guessing at hyperlinks. For example, there are a few underlined instances of `size_t' in the printf man page. If you ask for the size_t man page, you get the man page for stdint. Suppose I had a device on my desk that could automate this sort of drudgery for me...
(I did something like this for my patched version of Bwana: https://bitbucket.org/tom_seddon/bwana, original: https://www.bruji.com/bwana/ - works well, at least for the OS X man pages. My code only looks for man pages with the exact name, though, since it runs on demand. If you're doing a preprocess to generate all the pages ahead of time then you could perhaps afford to be more thorough.)
The content? Type / then your search term.
I have more ideas but I'll stop there. Good luck with your project!
In the past 8-10 months, it made about $5k+ through sales as well as partnerships with a couple online bootcamps. Not too shabby as I spent almost no time marketing it. Plus it was fun to write since I'm passionate about the topic and I've received some awesome feedback (of the "you actually changed my life"-sort). That was more than worth the hundreds of hours I spent writing it, the small bit of money aside.
You can go further and buy government bonds directly, through the Tesouro Direto system. Those indexed by the SELIC rate (which is sort of related to the CDI) are currently around 13.5% per year, before administration fees and taxes (in fact, the boring funds I mentioned above mostly invest in these SELIC-indexed government bonds).
This will change when (and if) rates get lower, but so far, investing in these funds or bonds is the simplest (and one of the best) way to have passive income.
A high interest rate is a signal that lenders are wary of lending money to the borrower because of an increased risk of default/inflation. That's fine as long as you are aware of this, but don't think you're getting a "better deal" than someone investing in a boring 1% German government bond. That 12.5% you're getting in addition represents the increased risk that the Brazilian government might default on their debts or the currency might inflate enough to negate the advantage.
As for inflation, when it increases the SELIC/CDI rates tend to rise with it too. And if you're afraid of that (it hasn't been long since we had a hyperinflation, so a lot of people still are), another government bond (NTN-B) has a return of inflation (measured by the IPCA index) plus a pre-fixed component (currently around 6%). Due to its pre-fixed component, it has some interest rate risk (if the interest rate rises, its present value drops, and vice-versa), but that's not a problem if you intend to keep it to term.
And, actually, the high interest rate is set by the government, as a way to control the inflation, so it's not as linked to the risk of default as one might think. The government could decide to lower the interest rate (and it has: a few years ago, it was set lower, but that led to the currently higher inflation, so the government increased it again to contain the inflation).
Wouldn't that be a good reason to invest some money abroad?
> And, actually, the high interest rate is set by the government, as a way to control the inflation
But surely that's the interest rate that their central bank charges to the banks (which influences the interest rates banks pay/charge for savings/loans with them), not the interest rate that they are paying on their own government bonds? I'm not an expert, but I'm pretty sure those are two very different things.
Yes, and I intend to do that someday. It's not trivial to do, however, while investing in the boring funds I mentioned is extremely easy for anyone with a bank account, and investing in government bonds is as easy as investing in stock. In particular, for both the funds and government bonds the tax is paid automatically, while if you invest abroad, you have to do the calculations yourself, and from what I've read they are not as simple. Not to mention the extra cost and risk of opening an account outside your country; for instance, the Brazilian customer protection laws won't apply to an account outside the country, for obvious reasons. All in all, it's a lot more research to do, with the extra risk of investing outside your home jurisdiction, for a much smaller return, and the only benefit being reducing your exposition to your own government - one I'll be always exposed to, since I live here (it could easily impose taxes on capital held abroad, for instance).
> But surely that's the interest rate that their central bank charges to the banks (which influences the interest rates banks pay/charge for savings/loans with them), not the interest rate that they are paying on their own government bonds? I'm not an expert, but I'm pretty sure those are two very different things.
It's complicated, but basically the government sets the SELIC rate target, and buys/sells government bonds so the SELIC rate moves towards that target. The SELIC rate itself is the interest rate banks pay each other for a one-day loan with government bonds as the guarantee. Finally, one of the government bonds (the LFT) pays the principal ajusted by the SELIC rate at its term. There is also the pre-fixed government bonds (the LTN), which pays a fixed value but is bought for less, the inflation-indexed NTN-B, which I already mentioned, and a few others.
As for why increasing the interest rate helps control the inflation, that's one thing I still don't quite understand. I just know that the government does increase the interest rate when the inflation gets above the target.
It also doesn't look like it's going to get better, just worse - so as far as I can discern the best course of action is just to spend it before it becomes completely valueless. To stay ahead of inflation here I'd have to have a 10% yield at least - official CPI figures grievously underreport it, as the baskets of goods they use don't account for the shrink ray.
There's an awful lot wrong with CPI/RPI measures, but needless to say this is tinfoil-hattery.
To say there is nothing to see without looking at any data is ass-hattery.
It's subtle, but present - a big driving factor has been unavailability of credit, which forces smaller batches for fabrication, which drives up price. This has commensurately resulted in a whole host of businesses in turkey and china who specialise in short-order just-in-time manufacturing.
But either way, prices have increased far more than is immediately apparent, particularly food, garments and low value giftware. The pinch is a lot harder at the bottom than the top of the market, too.
I obsessed over this data for years, as it was the key to understanding where to position (I.e. Who's making margin?), which retailers would be risky clients, etc.
https://www.bloomberg.com/quote/USDBRL:CUR
In other words: yes, investing in USD has a higher return, but that return also comes with a higher risk. I don't buy food with USD, I buy food with BRL, so the BRL is the one that matters here.
Instead of simply not accepting the bills, some places take a discount to offset the risk that they're fake. The older the bill, the greater the chance that it's a counterfeit.
And when the food prices do increase, consider that the food price is a big component of the inflation index, so both IPCA and later SELIC would rise to compensate.
The pain point is electronics. Almost all of it is imported, or has imported components. That one does tend to track the USD.