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    Monday, January 1, 2018

    What was your 2017 rate of return? What were your best and worst investments of the last year? Investing

    What was your 2017 rate of return? What were your best and worst investments of the last year? Investing


    What was your 2017 rate of return? What were your best and worst investments of the last year?

    Posted: 31 Dec 2017 04:12 PM PST

    MiFID II: Will companies such as Vangaurd & iShares translate their documentation to European languages due to the new legislation in the EU?

    Posted: 01 Jan 2018 01:28 AM PST

    The new legislation the MiFID II blocks any trade of ETFs and other derivatives until there is documentation released of these in the native language of the country.

    In my case I will not be able to buy vanguard ETFs until vanguard releases Dutch documentation as I live in the Netherlands and my broker (de giro) is also centralized in the Netherlands. Is it expected that they will release these documents or should I switch my broker

    submitted by /u/Spoooderr
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    Explaining business strategy to a 5 year old

    Posted: 31 Dec 2017 01:33 PM PST

    I think it's important for new investors to understand some basics of business strategy. Below I have decided to use a basic strategy framework to describe how market forces will effect a lemonade stand.

    Porters 5 Forces and a Lemonade Stand

    Porters 5 Forces model is the classic framework for analyzing business competition and potential profitability. It is one of the first things introduced in a quality business school curriculum and has been referenced for decades. At it's highest level, this model looks at expected external factors and how it will effect profitability.

    Billy gets some lemons and opens up shop on the sidewalk. Here are some threats he will face:

    1. New Entrants Billy's friend Colin sees that there is demand for Billy's lemonade and decides to open up a discount lemonade shop. Now that there are two stands, Billy will have to lower the price of his drink to compete or no one will come to his stand anymore.

    2. Substitutes Billy's other friend Joey hears that the cool kids drink iced tea in the summer. Joey opens up a tea stand, and more of Billy's business falls off.

    3. Bargaining customers There are now two lemonade stands and one iced tea stand. The thirsty people realize that the drink stands are competing. Sally approaches Billy and offers him 50 cents for a cup of lemonade, even though he's charging a dollar. But since Sally is the only one there, Billy gives in an reduces his price.

    4. Bargaining suppliers Due to a large hurricane that destroyed 4 out of the 5 top lemon groves in the world, the one undamaged grove is raising their prices. With a higher lemon cost, Billy's profit takes a hit. Is this the end?

    5. Rivalry Although discouraged at first by the competition, Billy realized that there were actions he could take to improve his business:

    *His mom shared her secret recipe for purple lemonade and all the kids love it. No one else can figure it out.

    *He hosted a ladies night where the first 10 girls drink for free. All the boys came to hang out and were thirsty too.

    *When competition caused profit to fall, he started to think of the cheap low-margin lemonade as the advertisement, and focused on upselling popsicles when customers arrived.

    This, in a nutshell, is how competition drives innovation and ultimately benefits the consumer. This example also underscores the huge importance of finding your competitive advantage and building a sustainable moat in order to mitigate the impact of these external forces.

    Thankfully, Billy was able to stay in business due to the innovation of his purple lemonade and the enduring demand for popsicles. Meanwhile, Colin and Joey failed in their ability to pivot. The realities of competition caught up with them and they paid the price– literally.

    Please let me know if you find value in this, or if there are other related topics you are interested in learning more about!

    -Paul

    submitted by /u/PWUsername
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    Happy new year <3

    Posted: 31 Dec 2017 09:30 PM PST

    While drinking many amaretto with lemon (very good), I was wondering, what will you change in your portfolio for 2018.

    I was planning on selling my gold etf to buy bonds instead (to have a 10% bond allocation). Also, I plan on owning more value/momentum ETFs.

    Love y'all

    submitted by /u/etienner
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    $NFLX: The worst of FANG

    Posted: 31 Dec 2017 05:03 AM PST

    I think Netflix is an awesome service and is not going anywhere. The 83B dollar valuation is insane.

    Why? First, the company does not care about its shareholders whatsoever. Since the stock has shot up in the last few years, there is no need to instill a share buyback program or pay a dividend. Instead, the company is rewarding its top executives with huge bonuses including 10s of millions in stock options, diluting shareholders stake in the company. The company can't reward its shareholders when its cash flow negative, and that doesn't seem to be changing anytime soon.

    Second, the company is not doing much to establish a competitive advantage. Disney has recently removed its content from Netflix and is streaming without Netflix as a middle man. Apple also is trying to get into the streaming business. HBO Go, Hulu, Amazon Prime are already established big competitors. The only competitive advantage Netflix has is the original content it creates, which is extremely expensive.

    The issue with the valuation is the company is currently trading at a p/e of 200 and an ev/ebitda of 106. With additions of competitors I see pricing pressure being put on the company which will decrease net income. How many more subscribers can Netflix realistically get? With prices the same, Netflix will have to quadruple its subscribers in the next few years to be trading anywhere near a reasonable valuation.

    With all these reasons combined, I can't justify Netflix's current price at all. I have no explanation for how the company can be trading for so much, but that doesn't mean the positive momentum won't carry the stock price up higher. During the next market correction, this stock with no fundamentals backing its valuation will hit the ground.

    submitted by /u/InvestingLifeSavings
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    Noob mistake: How do I put dividends into shares instead of cash and alts?

    Posted: 31 Dec 2017 09:46 PM PST

    I held some Comcast shares long enough to get a dividend (tiny, but hey, better than a kick in the head.) I use TDAmeritrade. What do I do to get that dividend put back into shares without a trade fee instead of getting a cash payment for when I make longer term investments?

    submitted by /u/NotMeanttoKnow
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    comprehensive historical US stocks prices database

    Posted: 01 Jan 2018 01:28 AM PST

    Hello, I'm looking for a databse of historical US stock prices. I've found a number of those, but no one that satisfy the required features:

    *EOD prices adjusted for capital events and cash dividends

    *contain delisted stocks

    *span as far back as possible

    *being cheep

    For instance Norgate for 600$ cca provides data going back to the '50s but it's not dividend adjusted.
    Sharadar Equity Prices, available at quandl, has everything I ask but only goes back to year 2000, priced at 400$.

    So does any one know if I can have best of both worlds at a reasonable price? Cheers!

    submitted by /u/Zingales
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    Can you invest in roth ira before income is earned?

    Posted: 31 Dec 2017 08:33 AM PST

    I make $19/hr as an intern and expect to make over $5,500 over the summer of 2018. I want to know if I'm allowed to just deposit $5,500 into my roth ira when new years comes along just because I expect to make $5,500.

    submitted by /u/xuhu55
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    Green energy etfs or companies that you recommend?

    Posted: 31 Dec 2017 04:36 PM PST

    Withdrawing money from capital gains

    Posted: 31 Dec 2017 01:39 PM PST

    Is my understanding correct about the following scenario:

    I have $100. I buy 100 XYZ stocks for $1 each. The next day the price of XYZ stock goes up to $2. If I then sell exactly $100 worth of XYZ stock, I will have a capital gains tax of $0 and do not have to pay taxes.

    If I sell any more stocks, then whatever I make from that sell will be considered capital gains.

    submitted by /u/InterplanetaryAlp
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    What are tech's expectations in 2018?

    Posted: 31 Dec 2017 06:20 PM PST

    One could look at the last month has an ordinary hiccup like the tech selloff in June/July. Or we could look at it has the beginning of mediocre performance. Obviously no one knows for sure, but i believe strong earnings will continue to lead to growth similar to 2017. What are your opinions, specifically about the semiconductor industry.

    submitted by /u/Nhl88
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    Besides Crypto, How did you do in the market this year? Whats your High/Lowes?

    Posted: 31 Dec 2017 09:02 PM PST

    Daily advice thread. All questions about your personal situation should be asked here

    Posted: 01 Jan 2018 04:05 AM PST

    If your question is "I have $10,000, what do I do?" or anything similar. There is no single answer to this question, but we will also need A LOT MORE information if we are to give some sort of answer

    • How old are you?
    • Are you employed/making income? How much?
    • What are your objectives with this money? (buy a house? Retirement savings?)
    • What is your risk tolerance? (Do you mind risking it at blackjack or do you need to know its 100% safe?)
    • What are you current holdings? (Do you already have exposure to specific funds and sectors?)
    • Any other assets? House paid off? Cars? Expensive girlfriend? (not really an asset)
    • What is your time horizon? Do you need this money next month? Next 20yrs?
    • Any big debts?
    • Any other relevant financial information will be useful to give you a proper answer.

    Be aware that these answers are just opinions of Redditors and should be used as a starting point for your research. You should strongly consider seeing a registered financial rep before making any financial decisions!

    submitted by /u/AutoModerator
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    It's moronic Monday, your chance to ask any of those lingering questions without fear of harassment.

    Posted: 01 Jan 2018 04:05 AM PST

    We encourage all our visitors to ask those investing related questions they were always too afraid to ask.

    The members of /r/investing are here to answer and educate!

    NOTE If your question is "I have $10,000, what do I do?" or anything similar. There is no single answer to this question, but we will also need A LOT MORE information if we are to give some sort of answer

    • How old are you?
    • Are you employed/making income? How much?
    • What are your objectives with this money? (buy a house? Retirement savings?)
    • What is your risk tolerance? (Do you mind risking it at blackjack or do you need to know its 100% safe?)
    • What are you current holdings? (Do you already have exposure to specific funds and sectors?)
    • Any other assets? House paid off? Cars? Expensive girlfriend? (not really an asset)
    • What is your time horizon? Do you need this money next month? Next 20yrs?
    • Any big debts?
    • Any other relevant financial information will be useful to give you a proper answer.

    Be aware that these answers are just opinions of Redditors and should be used as a starting point for your research. You should strongly consider seeing a registered financial rep before making any financial decisions!

    submitted by /u/AutoModerator
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    Investopedia courses

    Posted: 01 Jan 2018 04:02 AM PST

    Hey ladies and gents, thanks for taking time to read this. I'm sure you all started somewhere and can agree that the whole world of investing can be a confusing place, I am currently looking into investing and have read a few books around the topic, I have found investopedia a great source of easy to understand videos and descriptions, they offer several courses on investing and I am wondering if anyone can vouch for their value? Or possibly suggest some other sources.

    Some additional information I have read and enjoyed Tony Robins - unshakeable and think that I should follow the indices trading outlined there, as I'm still new to the whole scene and feel that buy and hold for me currently would be a much more manageable task.

    Realised I am now blabbering.

    Happy new year.

    submitted by /u/greguk85
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    Minimum amount of $ to justify stock/ETF purchase w/$4.95 commission

    Posted: 31 Dec 2017 08:02 PM PST

    What is the minimum amount of $ required for you to purchase shares of stocks/ETFs on a $4.95 commission? I've heard $10,000, but I've bought ETF shares w/a $4.95 commission in $1,000 and $2,800 increments, which would mean I'm losing 0.5% and 0.18% on those investments immediately (0.5% feels high, 0.18% feels reasonable).

    submitted by /u/SimCopter_1
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    Why as an european investor you will be temporarily unable to purchase some foreign ETFs.

    Posted: 31 Dec 2017 06:41 AM PST

    From my Broker (Degiro)

    Why will some foreign ETFs and derivatives be (temporarily) unavailable from 02-01-18 onwards?

    In accordance with new European legislation (MiFID II), parties issuing ETFs and derivatives are obliged to provide documentation in the language of country where the buyer resides. This in order to better protect and inform buyers. Many foreign issues still choose to write these documents in their own local language. These products will no longer be purchasable on our platform, starting from the 2nd of January, lasting until the language requirements are met.

    Which products will this affect?

    This regards a selection of foreign ETFs and derivatives where no documentation in English is provided.

    How long will this last?

    This will differ per product, and solely depends on the issuing parties. As soon as documentation in English is available, the products will be purchasable again on our platform.

    Can I still own or sell these products?

    Yes, the change only prevents you from purchasing these products on our platform. Owning or selling them will work as it did before, and remain possible.

    Can I still purchase these ETFs and derivatives with other parties? As this is the result of a change in European legislation, all issuing parties in Europe need to comply to this demand. For you as a UK customer, all UK brokers will only be able to offer these products when the documentation is available in English.

    In accordance with new European legislation (MiFID II), parties issuing ETFs and derivatives are obliged to provide documentation in the language of country where the buyer resides. This in order to better protect and inform buyers. Many foreign issues still choose to write these documents in their own local language. These products will no longer be purchasable on our platform, starting from the 2nd of January, lasting until the language requirements are met.

    Which products will this affect?

    This regards a selection of foreign ETFs and derivatives where no documentation in [insert local language] is provided. For example, ETFs from Vanguard or iShares.

    How long will this last?

    This will differ per product, and solely depends on the issuing parties. As soon as documentation in [insert local language] is available, the products will be purchasable again on our platform.

    Can I still own or sell these products?

    Yes, the change only prevents you from purchasing these products on our platform. Owning or selling them will work as it did before, and remain possible.

    Can I still purchase these ETFs and derivatives with other parties?

    As this is the result of a change in European legislation, all issuing parties in Europe need to comply to this demand. For you as a UK customer, all British brokers will only be able to offer these products when the documentation is available in English.

    submitted by /u/john-r
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    Is anyone concerned about the liquidity of ETF's in a market downturn?

    Posted: 31 Dec 2017 05:57 AM PST

    Since ETFs are a relatively new investment vehicle, and investors have poured $50 billion into S&P trackers this year alone, I was wondering if anyone has concerns about overexposure to S&P tracking ETFs. It seems that in a major selloff, this could adversely affect the market in a more profound way

    submitted by /u/jaybotwin
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    Looking to add an international index fund to my portfolio? Suggestions?

    Posted: 31 Dec 2017 09:09 PM PST

    My current portfolio currently consists of:

    • SPY (approx 25%)

    • BRK-B (approx 15%)

    • QQQ, Nasdaq index fund, (20%)

    • DIA, Dow index fund (approx 10%)

    • VIOO, Vanguard Small Cap (approx 10%)

    • Misc large cap stocks I like to follow, such as DIS, RCL, V, GOOG, and others (approx 20%)

    I am a long-term investor. I enjoy learning about and controlling my own investments, but probably not as savvy as many of the hardcore investors on this sub.

    I think I need exposure to international markets. Suggestions for an index fund that I can research?

    submitted by /u/marfalump
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    I’m 17. I have $2,000 I’ve set aside strictly to invest. What do I do?

    Posted: 01 Jan 2018 12:21 AM PST

    I've taken a simple investing class which only taught me what investing is basically, not how to properly invest. Looking for proper advice for a 17 year old to invest $2,000 I've saved over two summers of work and gifts. Thanks!

    submitted by /u/SamuraiiSwordd
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    asset allocation 2018

    Posted: 31 Dec 2017 08:43 AM PST

    just wanted to get an idea of how everyone's is allocating their money in 18? i'm keeping it simple i'm going 50% Fidelity® 500 Index Fund - Premium Class 30% Fidelity® Global ex U.S. Index Fund 20% Fidelity® U.S. Bond Index Fund

    submitted by /u/j2324
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    High Average Returns from Buying Junk Bonds? How?

    Posted: 31 Dec 2017 03:47 PM PST

    If someone makes, on average, approximately 37% a year, over ten years, buying junk bonds, how did they average 37% a year when no junk bonds offer even close to that much?

    For example, the highest yield offered on a junk bond that I have been able to find (granted, I'm new) is 8% or so. So how would someone average 37% a year for ten years buying junk bonds? Are there junk bonds that actually offer 30%+ if you buy them?

    submitted by /u/ChrisDurst
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    Pros and cons of renting to college students?

    Posted: 31 Dec 2017 06:47 PM PST

    I'm thinking that if I own a rental house very near to campus it would be easy to get renters and I could charge high rent, though it would cost more to buy up front.

    Good idea or bad idea?

    submitted by /u/TheDude9357
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    What do you guys think of the perfect market hypothesis? Is it real?

    Posted: 31 Dec 2017 04:27 PM PST

    My understanding of the perfect market hypothesis:

    It is impossible to find an undervalued stock. You are just one guy. Wall street is filled floor to floor with people who have masters in economics, working around the clock, and actually reading company's 10-k forms. You are not going to find a undervalued stock. But, the market has a higher chance of going up than down. Stop looking for undervalued stocks because analyst have already invested in them to the point where the stocks are at their current value.

    What do you guys think of this statement? my paraphrased version from "A random walk down walk street."

    submitted by /u/RoboticsNote
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