Investing General Discussion

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Khane

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I know you equate this to me but I actually agree with you, when I got my first degree in Economics and then Finance I was positive it was a career for me. The more I learned about major financial firms and how the people are there and how they actually make money I couldn't run away fast enough.

I don't equate that to you personally at all. I agree with most of what you say in this thread and typically share your views on strategy and long term goals.
 

Blazin

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I don't equate that to you personally at all. I agree with most of what you say in this thread and typically share your views on strategy and long term goals.

I just mean because I sell puts which may be bought by gamblers. I equated your previous opinions to include options amongst their BS games, which they can be, but I believe they have a useful function when used appropriately by educated parties. Meaning I don't find them exclusively predatory. Now 3x leveraged ETFs...that's another ball of wax.
 

Pops

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See what happens here. I'd expect some resistance. But people want to get back to work. They need to get back to work.
 
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Pops

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Haha, I see that Shop at ATH. Do I buy it when I posted no. I end up buying some fucked up chem company and more of that POS shipper. Don't fuck me now. Your div dec is any day now. Pay it.
 
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Furious

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I hear you guys and so far Im in the same boat.

Financially this has been good so far for me but when you have a guy like Munger saying things like this is the worst storm the market will ever experience and Berkshire is not buying a damn thing because they don't have a clue how this will play out, makes me worry a bit.
 

Sanrith Descartes

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One thing to consider. The "market" doesn't have to go up to make money. Put options are one way to make money in a downturn and owning individual stocks can also make money when the market goes backwards. 100% indexing can be a viable strategy but then its tied directly to market progress. By enhancing an index core portfolio with blue chips from sectors, you can be up and the market down (or at least not down as much).
 

Sanrith Descartes

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I hear you guys and so far Im in the same boat.

Financially this has been good so far for me but when you have a guy like Munger saying things like this is the worst storm the market will ever experience and Berkshire is not buying a damn thing because they don't have a clue how this will play out, makes me worry a bit.
We don't know about Berkshire. If he owns less than 10% it doesn't have to be declared (I believe). I won't be surprised if he bought some shit and has kept it on the downlow.
 

Furious

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One thing to consider. The "market" doesn't have to go up to make money. Put options are one way to make money in a downturn and owning individual stocks can also make money when the market goes backwards. 100% indexing can be a viable strategy but then its tied directly to market progress. By enhancing an index core portfolio with blue chips from sectors, you can be up and the market down (or at least not down as much).

True, Options trading is a freaking nightmare in Canada
 

Blazin

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My expectation is that a lot of people do get back to work pretty quickly but that many companies will take this opportunity to tighten the belt some and get rid of some less needed people. It's hard to gauge just exactly how many this will be. Unemployment in the 8-12% range after we are full running would not surprise me. At that point I'll be watching those weekly and monthly numbers pretty closely to see what kind of run rate on new job growth we end up with.

If the demand is slow due to changes in behavior new hiring will not be robust. I expect further monetary and fiscal stimulus during this period. Stumbling blocks include capital expenditures by companies being anemic due to cloudy near term outlook. Consumer reluctance to re-establish old behaviors, eat out less often, travel less often etc. (I think this will fade with time if we don't have a significant relapse. ) Many people are fearing a second shut down but based on behavior we are seeing around the country last few days would people even listen to a second shutdown? Very hard to say.

Add on to that we have an election this Fall and partisan fighting will make additional fiscal stimulus harder and harder to come by as we get close to Nov.

It's because of all this that I would say if someone missed this first 30% upside, jumping in with both feet may work if you have a stomach for more downside volatility and a sufficiently long outlook. Otherwise a very slow dollarcost avg of cash into the market is probably prudent. If it dips go a little heavier. Cash and low yielding bonds are going to be trash coming out of this and just need to keep looking forward and positioning for the long term. All this free money might finally be what is needed to get the inflation the Fed has been searching for. If we do get a higher rate of inflation you sure as shit don't want to be in cash or bonds.

Historical recessions, we would get a second low where fear is lower, people are more demoralized by stocks, and that people begin to give up that things will improve. That is the magical moment when our pessimism will have gone to far and the recovery begins in ways we had trouble seeing just prior. However, this event is very atypical, it's self induced complete shutdown of an economy that was at full employment. Literally nobody knows the trajectory of how we come out of this.

If you want to be super negative, if we get inflation while the economy is failing to find it's footing then we are in serious shit. 1970s stagflation all over again and the Fed will be forced to raise rates in the face of slowing demand. This is the worst possible outcome. People should not live in fear of this, pay attention to it, some things are bigger than us and some things you just can't hide from. Holding good solid assets is all you can do during that environment, and given how many here are savers we are better positioned for that worse case scenario than the prolific borrower.
 
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Pops

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I hear you guys and so far Im in the same boat.

Financially this has been good so far for me but when you have a guy like Munger saying things like this is the worst storm the market will ever experience and Berkshire is not buying a damn thing because they don't have a clue how this will play out, makes me worry a bit.

That's why you need a cash reserve. But with the mattress money at a zero return, there is no place to hide. you got to buy some thing.

Munger is looking for another deal like OXY. They got a death spiral type deal. And I had that fucking WES. Icahn must be fucked so I watch Oxy and dumped WES into ET. God help me.
 

Furious

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Munger is looking for another deal like OXY. They got a death spiral type deal. And I had that fucking WES. Icahn must be fucked so I watch Oxy and dumped WES into ET. God help me.

I'm trying my hardest to stay out of oil.

I'm holding 50% cash at the moment but I'm buying in when days are red. Haven't leveraged at all yet but I will if we hit that capitulation point blazin was referring too above
 

Blazin

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And to reiterate you don't need to position based on guesses, if things are as weak as many of us expect then the market is going to struggle with the 200 day ma which has just started rolling over, we may be acting impatient. The decline was very rapid compared to how the market would slowly give ground into a weakening economy, if we are in a bear market you are going to know because that 200 day is going to start to point down and the market will struggle to get consistent closes above it. If that happens it's okay to be a little greedy with buys and wait for lower prices but it will more likely be stair steps down as earning revisions for 2021 and 2022 are made and this can happen for an extended period of time. There will be green days there will be red days but the trend will wane.

On the flip side if we get on top of the 200 day avg and stay on top of it to the point it begins turning up then it will become more prudent to apply long term money into the market.

The good news is the 100s of percent that will be made in the years following all of this, you don't need to catch the bottom of a bear market to reap the rewards of the subsequent bull. Patience is warranted.
 
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Sanrith Descartes

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We are in the times when trading and investing need to be clearing defined in your portfolio. If you are investing in something like the SPY and the QQQ, then whether we dip down 5, 10, 20% doesn't overly matter. Within a currently undefined time it will be back up and making new highs. A dip is just an opportunity to dollar cost average a bit. Over years and decades it doesn't really matter.

Trading on the other hand, you are looking for optimal entry and exit points to maximize the flip. If it helps, use Excel or even a piece of paper to track your long term investments and your trades and mark them separately. To be honest I rarely pay attention to my IVV, QQQ and SPYG as I am holding them forever. The exception being when we are in a downward movement and I am looking to add some more.
 

Sanrith Descartes

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Triple leveraged Bear (inverse) SP500 ETF had some of the biggest inflows this week. If they are wrong it could be another week of epic short squeezing.

The other big inflow was USO. Lots of people buying US Oil and I bet they have no understanding of futures contracts and contango. They see sub $19 oil not realizing those contracts are basically dead already.

 

Unidin

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I like how they tag Snapchat but not American Express in the header. Because Snapchat's earnings means anything.
 
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Pops

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I'm trying my hardest to stay out of oil.

I'm holding 50% cash at the moment but I'm buying in when days are red. Haven't leveraged at all yet but I will if we hit that capitulation point blazin was referring too above

Back during the GFC meltdown, I thought of mortgaging the house. But just like options leverage makes the emotional toll a bit tougher. You always get faced with a life or death call at the worst possible moment. That's why said posts ago, sell at the first tingle of fear. Who cares if you are wrong. You live to play another day.

I buy plenty back at higher prices.
 

Furry

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WTI prices down under 17$ a barrel. Looks like they are going to need a bigger production cut. This is gonna be a bad year for canada's GDP.
 

Pops

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You sold that GME squeeze yet? Nordies going bk isn't going to help my rebuilt CPRI.