What if you invested instead?
October 25, 2016 3:31 AM   Subscribe

InvestedInstead.com is a little website with a single purpose, which is to provide you with the answer to the question "if I instead of buying <iconic product> on launch day invested the same amount of money into <iconic product's maker>, what would my investment be worth today?"
posted by Harald74 (39 comments total) 11 users marked this as a favorite
 
That's interesting. Of course, if everyone invested in the companies instead of buying the products...
posted by chavenet at 3:33 AM on October 25, 2016 [11 favorites]


This is very much in the realm of "if I had tomorrow's racing paper I'd make a fortune betting on horses".
posted by pipeski at 4:03 AM on October 25, 2016 [30 favorites]


What date did MeFi memberships open on?
posted by DoctorFedora at 4:08 AM on October 25, 2016 [8 favorites]


Where's Blockbuster, GM, Schwinn, or Kodak?

oh.
posted by leotrotsky at 4:17 AM on October 25, 2016 [25 favorites]


I mean it's cool to think about, but also I wouldn't have those products to use.

So I think from now on I will invest equally the cost of the flagship I'm buying and still buy the flagship. Then over the course of time everything I buy will pay for itself.

My plan is flawless.
posted by mayonnaises at 4:20 AM on October 25, 2016 [6 favorites]


AKA "the thing I can't stop thinking about now that I'm in my late middle age and still don't own a house."
posted by Halloween Jack at 4:31 AM on October 25, 2016 [15 favorites]


Wow. This site incorporates two of the most annoying types in the human genome. The nerd who stands in-line to get the bright new shiny thing the millisecond it's released, and the asshole at the party who wants you to think about how much money you would have accumulated if you'd just foregone that small latte every morning before work.
posted by Thorzdad at 5:20 AM on October 25, 2016 [32 favorites]


My favourite instance of this genre was at the TD Bank branch right next to the Hockey Hall of Fame in Toronto where they used to have a display that pointed out that the best possible investment for a specific period of time was a particular hockey card. I cannot remember the details but it did strike me as a rather odd admission for a financial institution to make.
posted by srboisvert at 5:21 AM on October 25, 2016 [4 favorites]


This is lovely in a sort of oh, cool: now I can quantify my lack of hindsight way, but it doesn't seem especially accurate.

For example, the site claims that $499 invested in AAPL on the iPhone release date in 2007 would be worth $3,678 today. But that smells suspiciously low to me. Some quick napkin math tells me that should actually be just over $15,000... which is one heck of a difference. This makes me doubt all the rest of the site's math, as a result.

(I suspect the calculator doesn't include dividends, or factor in that stocks split, for example. And a big split like Apple's 7-for-1 back in 2013 makes a heck of a difference, here.)
posted by rokusan at 5:38 AM on October 25, 2016 [7 favorites]


iPhone! Whoohoo!
posted by usonian at 5:40 AM on October 25, 2016 [3 favorites]


Double.
posted by gwint at 5:42 AM on October 25, 2016 [1 favorite]


And if I had spent every hour I spent on video games working a second job instead, I could have accumulated tens of thousands of dollars.
posted by JDHarper at 5:47 AM on October 25, 2016 [5 favorites]


What if I don't spend money on food, but instead invest it in food producers?
posted by farlukar at 6:07 AM on October 25, 2016 [12 favorites]


How can investments be real if our iPhones aren't real?

Actually my computer and smartphone are both investments that I've used to advance my career, and I would be considerably worse off if I'd decided to invest in the tech industry rather than educate myself enough to work in it.

OTOH, when I actually have cash to burn on fripperies like shares, I'll bear these examples in mind.
posted by Wrinkled Stumpskin at 6:26 AM on October 25, 2016 [3 favorites]


runs to register seizedthemeansofproductioninstead.com and expropriatedtheexpropriatorsinstead.com
posted by enn at 6:37 AM on October 25, 2016 [15 favorites]


Some of these examples have enough longevity in them that it makes me curious what a "constant dollars" comparison would be.
posted by oheso at 6:40 AM on October 25, 2016 [1 favorite]


Well, it has barely anything I own, let alone on release, but out of curiosity, decided to see what would have happen if instead of buying my laptop, I invested in HP shares in October 2010. I think it was around the 10th, so... 903 bucks (I think my laptop was around €650, and that was the exchange rate then) would have got me 48 shares. Those shares would be worth $753 now.

I think this is just a little web toy, but it probably wouldn't be too hard to insert a date of purchase and how much, use something like the Yahoo Finance API to pull the value from that date and the current value of the stock now and adjust inflation.
posted by lmfsilva at 6:42 AM on October 25, 2016 [1 favorite]


Is there a more general version of this? I've wondered this about other purchases, like cars and appliances, but haven't known how to figure it out.
posted by Dip Flash at 6:53 AM on October 25, 2016


Not what I was expecting, which was some variation of "what if I bought it used and invested the difference instead?" Really handy in instances like, "how much will I have in 10 years if I pay half to buy a used car instead of a new one?"
posted by indubitable at 6:58 AM on October 25, 2016


This brings to mind my favorite moment from Atlanta:

"See, I'm poor, Darius, OK? And poor people don't have time for investments, because poor people are too busy trying not to be poor, OK? I need to eat today, not in September!"
posted by NoMich at 7:03 AM on October 25, 2016 [4 favorites]


It's a shame the products are so cherry-picked. The last few years of AAPL have been a rollercoaster, and it'd be interesting to see how screwed you'd be if you'd invested in Blackberry or Nokia at their peaks.
posted by grahamparks at 7:22 AM on October 25, 2016 [2 favorites]


For example, the site claims that $499 invested in AAPL on the iPhone release date in 2007 would be worth $3,678 today. But that smells suspiciously low to me.

This chart factors in dividend reinvestment and the split, and shows a roughly 750% return per dollar invested in 2007.
posted by Candleman at 7:40 AM on October 25, 2016


That's a really limited data set -- why only tech items? Why not cars, appliances, wine, etc.?

And if it's as inaccurate on the others as it is for Apple, it's even more useless.
posted by me3dia at 8:20 AM on October 25, 2016 [1 favorite]


What date did MeFi memberships open on?

$5 noob day is November 18, 2004. Since Metafilter is not publicly traded, we'll use a Vanguard Information Technology ETF established in 2004 as our proxy. That fund shows an annualized RoR of 7.92%. Compounding that to the present gives you approximately $12.47.
posted by leotrotsky at 8:20 AM on October 25, 2016 [5 favorites]


Is there a more general version of this? I've wondered this about other purchases, like cars and appliances, but haven't known how to figure it out.

It's pretty simple if you don't need to know the share price of Ford Motor Co. Take the purchase price and plug it into a compound interest calculator using seven or eight percent return (the S&P 500's historic average return) and whatever time period you'd like to apply.
posted by notyou at 8:55 AM on October 25, 2016


If I had taken the $5K I've spent on textbooks and instead invested in shares of commercial academic publishing companies starting in college. . . I'm fairly confident my life would be immeasurably worse.

This is a cute idea, and anti-consumer thought experiments are always fun, but this version is so simplified that it's not clear whether it does more harm than good. How do you weight the likelihood that a gadget will bring immediate benefits against the likelihood that a particular company will do well? How do you measure the quality-of-life improvement associated with owning a thing? (Classically, I suppose, by counting up the opportunity cost associated with buying it. . . which has the unfortunate outcome that you break even in this analysis, by definition.) For that matter, what are the global implication of a market driven by speculative investment and almost completely disconnected from qualitative measures of value? Giving a choice between owning a Palm Pilot and owning the equivalent in PALM shares in 2001, investing looks like a terrible idea.

Going further, if you asked me out of context what I'd need to get paid today to make up for not having a personal audio player since the mid-2000s, it would almost certainly be comparable to the cost of a house in a big US city. My audio devices have been both cheaper and made by less successful companies than Apple; however, if the world contained only ipods sold in 2001 and if the only other option was Apple stock, I'd happily give up on the $40K the web site suggests I've lost in order to listen to audio programs while riding the bus for more than a decade. Trading many tens of thousands of hours of entertainment for $40K is a pretty good deal. (Whether that $40K should instead have been spent on other things that would be better for the world is an uncomfortable, but important question.)

From the point of view of someone who can't predict the future, a slightly less silly question is what you would have earned if you'd invested the cost of a product in a typical index fund instead. But, the answer isn't nearly as exciting: factors of 2-3 at the very most over this period. That may be a good reason not to upgrade to the newest ipod, but it's a thoroughly unconvincing reason not to buy one in the first place.
posted by eotvos at 9:13 AM on October 25, 2016 [2 favorites]


Eh, my Metafilter $5 is now worth $20 SAIT.
posted by advicepig at 9:14 AM on October 25, 2016 [4 favorites]


That's a really limited data set -- why only tech items? Why not cars, appliances, wine, etc.?

Tesla Model S. Which both speaks to and against your point I think -- as cars go, Teslas are optional lifestyle accessories. A lot of the stuff on the list counts are things that could have probably been considered to be optional lifestyle accessories on launch day (regardless of how indispensable they are now).

Actually my computer and smartphone are both investments that I've used to advance my career, and I would be considerably worse off if I'd decided to invest in the tech industry rather than educate myself enough to work in it.

Are your computer and smartphone iconic products that you purchased on launch day?

I think that people are looking at this as trying to prove that it was somehow financially stupid to buy an ipod or an xbox, but I don't think that that's the point. Like the "latte" advice, it's more about considering what you're giving up when you choose to make a buying decision. For some people, the latte is worth it, even knowing the "true" cost. For others, the free hot brown stuff at the office is good enough. For Goldilocks, maybe paying $2.10 for a grande drip coffee instead of $3.65 for that latte is the appropriate tradeoff.

I think it's even more stark when you look at how horribly dated some of the stuff seems now. I was gifted a first-gen kindle, and I loved it until it's battery wouldn't hold a charge anymore. But I probably would have been happier with $4103 and a Paperwhite today. Or even, whatever Kindle $500+interest could have gotten me in 2010. I'm not sure that I could say the same thing about going Kindle-free now for the chance at a nice return 5 years from now. BUT, I've also decided not to buy an Echo (yet), because I haven't seen how it would make my life better enough to be worth it.

And that's not even getting into the "launch day" thing. Electronics always get cheaper. Even if (like me) you're the type to buy tech items new instead of used, and even if (like me) you are only every satisfied with buying the latest and greatest, I think it's still worthwhile to consider whether it makes any sense at all to buy [NEW SHINY] on launch day at full retail instead of at least waiting a few months for the first price drop.

There are plenty of perfectly valid reasons (including: I want this and can afford it now), to choose to buy [NEW SHINY] as soon as one can, but if financial responsibility is a priority for someone, thinking about stuff in the way that this site presents it seems valid.
posted by sparklemotion at 9:19 AM on October 25, 2016 [1 favorite]


> Eh, my Metafilter $5 is now worth $20 SAIT

Or as some credit card company would have it, pricesless
posted by farlukar at 9:22 AM on October 25, 2016


Anyone who buys untested technology on launch day is a damn fool and deserves whatever they get.
posted by Faint of Butt at 9:26 AM on October 25, 2016 [1 favorite]


Where's Blockbuster, GM, Schwinn, or Kodak?
oh.


*cough* Blackberry *cough*
posted by Kabanos at 10:05 AM on October 25, 2016 [1 favorite]


This is a cute idea, and anti-consumer thought experiments are always fun, but this version is so simplified that it's not clear whether it does more harm than good. How do you weight the likelihood that a gadget will bring immediate benefits against the likelihood that a particular company will do well? How do you measure the quality-of-life improvement associated with owning a thing?

Exactly. And I'd even go so far as to challenge the idea that this is in any way "anti-consumerist". It's really just the same old warmed-over nonsense about poor people being "bad with money". Rather than poor people being, you know, under-compensated, gouged at every turn by rent-seeking corporations, etc., etc.
posted by tobascodagama at 10:22 AM on October 25, 2016


It's really just the same old warmed-over nonsense about poor people being "bad with money".

What does this site have to do with "poor people?" The featured products are things that are popular across classes, no advice/lessons on how to live life are offered. Just (possibly flawed) numbers.

If you want to rail against implied value judgments, the sister site, What If I Bought Apple Instead (of having a child) seems to be more fertile (ahem) ground.
posted by sparklemotion at 10:49 AM on October 25, 2016 [2 favorites]


The implication is extremely clear. If only you frivolous idiots bought STOCK instead of THINGS, you could be rich!
posted by tobascodagama at 11:07 AM on October 25, 2016


For all the problems with this site, the biggest one is the form resets to Amazon/Kindle 1 every time. If I checked out IBM PC 5150, you select those values in the form so I don't have to repeat myself in order to see the results for the IBM ThinkPad 300.
posted by cardioid at 11:19 AM on October 25, 2016


The implication is extremely clear. If only you frivolous idiots bought STOCK instead of THINGS, you could be rich!

Anything that you're reading into this besides: If you had bought STOCK instead of THINGS you could have $X money, is on you, I think. Frivolouslness vs. responsibility, idiocy vs. genius, rich vs. poor aren't part of the equation.

To start with, for most of the products listed, $X is not enough to make someone "rich." (1980s apple products aside)

I'll give you that [more money = good] is a reasonable value judgment to assume from the site. But the site doesn't say that buying stock is better than buying things -- and folks in this thread have pointed out lots of reasons why it's pretty trivial to see that such a blanket statement would be inaccurate. The site doesn't try to quantify the value of having/using the things, which is necessary to make a value judgment about whether or not buying the things would have been a good decision (and, prospectively, whether buying the next thing will be a good decision).
posted by sparklemotion at 11:48 AM on October 25, 2016


Which dovetails into the observation that if a certain New Yorker had put his inherited money into index funds instead of his own scammy businesses, he'd be a lot richer and we'd all be a lot better off.
posted by oneswellfoop at 12:03 PM on October 25, 2016 [4 favorites]


Oh look another Rorschach thread.

You could draw all kind of "lessons" from this.
  • If you like a company's products enough to buy them, you should consider buying the company too (a.k.a. the Warren Buffet strategy)
  • If you can't afford the product you really want, you can probably afford to buy some of the company instead (a.k.a. I want a Model S, but I only have enough for 100 shares of TSLA).
  • I really should have held onto my AMZN stock :(
posted by danny the boy at 1:05 PM on October 25, 2016 [1 favorite]


What if I've used product X for work? Does that not make buying the product a better investment? Or put another way, what about opportunity cost?
posted by piyushnz at 6:23 PM on October 25, 2016 [1 favorite]


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