Becker Private Equity & Business Podcast
Twitter Poll: Where Should You Allocate Most of Your Equity Side Investments? 4-23-25
Wed, 23 Apr 2025
In this episode, Scott Becker breaks down the results of a recent Twitter poll on equity investment strategies.
Chapter 1: Who is Scott Becker and what is this episode about?
This is Scott Becker with the Becker Private Equity and Business Podcast. Today's discussion is based on a poll we did on Twitter, which is increasingly one of my favorite things to do. Where should you allocate most of your equity side investments? And again, this doesn't talk about your allocation of equities to bonds. This simply deals with the equity side. So bear with me here.
Chapter 2: What were the options and results of the Twitter poll on equity side investments?
We gave people four options and one was the overwhelming favorite. And this might also be a bias towards how I ordered the survey as well. Index funds, 57%. Individual stocks, 21%. I'm glad people are getting that message. Private equity funds, 13%. And again, Very complicated because a lot of people don't have access to private equity funds.
Chapter 3: How does Scott Becker evaluate each type of equity investment?
And finally, private companies investing in individual companies, 9%. Now, this mirrors my experience. Index funds, I think, is the safest, smartest way to go. The PE funds I've invested have done fine. The private companies, other than the one I founded, have been sort of all over the board.
Chapter 4: What insights does Scott share about the risks and successes of private equity and individual stocks?
Some good, some bad, where I particularly knew the business and knew it well, and the managers better than others. Other ones, just a disaster. And individual stocks, I view as gambling a crapshoot. So I think more interesting than that is some of the answers you get from people about this question. And I'll just give you three or four of the responses we got.
Chapter 5: What are some listener responses to the equity investment poll?
And I love this because they're illuminating about where people see things. So a couple of these are sort of negative, of course. The first one says, I don't understand the investment you speak of between my car, my rent, and insurance. My salary is basically 100% taken up every month. Another person says,
with a more direct response, but I love that response too, because it's telling about where the world's at. Individual stock picking is too risky and requires a lot of time and effort. Better risk reward is to own the whole market, which means essentially to go ahead and own the index funds versus individual stocks. Another person says, the vast majority of people should focus on index funds.
If you have a particular insight into a particular industry, individual stocks may be fine, either public or private. And then he also says private equity funds generally tend to be better for the managers than for the actual investors. You know, there are exceptions. Another person says cash and buy ammunition. I don't know if that's a real response. Another person says buy only Bitcoin.
I have outpoured everything else the last eight and a half years. I'll continue to outperform book market. That's somebody who says they're the Bitcoin person. Then finally, a last person, and I don't think this is a serious answer, but maybe a person who is an anti-capitalist says, quote, up my ass, quote.
I don't think that is a serious survey response, but it articulates where some people think about what's going on in the world. In any event, I love these polls to give me a sense of what people think. Unfortunately, sometimes they're probably my bias might show by how I ordered the survey responses.
But I still think it's fascinating to see how many people have bought into the concept that index funds are the way to go. I don't even put mutual funds in there because so few mutual fund managers outperform index. index funds and you pay a high percentage to own mutual funds that I've really gone the index fund route.
In any event, thank you for listening to the Becker Private Equity and Business Podcast. Thank you very, very much.
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