Originally Posted by NoahJ
Seems to me that if you don't want to lose your shirt in the stock market, you don't put your shirt in the stock market. Invest what you can afford to lose and keep out what you cannot. If you lose due to a huge market correction or other steep decline in share prices then you did not invest wisely. There are no guarantees in the stock market other than the prices will fluctuate from day to day. How much and in what direction completely depends on factors that are beyond anyone's control.
Of course there are no guarantees in the stock market. However, in the long term (like decades), a diversified stock portfolio will outperform many other investments. Every investment has a risk, with potential upside and downside.
There are alternative investments that negatively correlate with the stock market as well.
Every individual has their own level of acceptable risk tolerance. Each investor should come to their own conclusions about how to build a portfolio that presents ample opportunity for appreciation, yet isn't so risky as to cause losing sleep.
No one is ever going to bat 1.000 in their investments. You win some, you lose some. The goal is to learn from your mistakes, get better with time, and have some investments that at least outperform the inflation rate, and maybe even the S&P 500.
If you don't care to do the research yourself, you can shove your money into mutual funds, ETFs, etc. and let the professionals try to figure it out.
For me, I am happy to have taken the risk of investing in AAPL. As AAPL's share price increases, it has become a larger percentage of my overall portfolio, but it is still well below 10% of my total direct holdings (there's some AAPL being indirectly held via various mutual funds). Note that I'm not required to liquidate my entire AAPL position. I can sell a portion and walk away with a bundle of cash, yet still have the chance to make more (or lose some). Most likely, if my AAPL direct holdings do exceed 10% of my total portfolio, I will consider selling some off to diversify.