They've been beat over the head for so many years and decades of people telling them,

and people like you at The Motley Fool, and that's people like me in a blog, hey, when stocks

go down, you don't run out of the store because they're on sale, you rush in to buy.

And it seems like people have actually learned.

And so I make the case all the time that I think investor behavior has actually gotten better

over time.

That was Ben Carlson, author of the Wealth of Common Sense blog,

co-host of the Animal Spirits podcast, and the author of the upcoming book, Risk and Reward,

How to Handle Market Volatility and Build Long-Term Wealth.

I'm Robert ProCamp and today is part two of my conversation with Ben,

during which we discuss the risks of investing in individual stocks,

market valuations, balancing, saving for the future versus enjoying life today,

and the career advice we give our kids.

We've been talking about the performance of broad asset classes here, right?

Which you can get exposure to through a low-cost index fund.

But what about individual stocks, which a lot of our listeners own?

Because even though the U.S. stock market has always recovered from every downturn, not every stock does. How do you approach investing in individual stocks? Yeah, and I highlight the work of Hendrik Besson Binder in here. He's a professor at the University of Arizona State, and he talks about the fact that over the long haul, the concentration of the U.S. stock market is probably more than you think. His definition of long term is even longer the mine probably. He's looking at like 100 years of data and he says,

basically 60% or so of the companies fail to keep up with key bills or cash, right? Over the very

long term. The other 30% in change kind of more or less keep up with that, maybe a little

better. And then something like 4% of all stocks are account for all the gains. So it's the big ones you know. Apple and Exxon and Amazon and Google and Nvidia. And these huge stocks from a market cap perspective have given investors all their gains over the past 100 years or whatever. And his point is, you know, there's a lot of different

ways to look at it. The one way to look at it is if you own just one of these winners, you're probably set. Like all of your other losers are, you can offset all of them. So if you're an individual stock picker, as long as you have, again, that intestinal fortitude to stick with a long-term winner like that, like that can pay off a lot of bets.

And it's almost like a VC portfolio, a power law.

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