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    Stocks - Gain required to fully recover from a loss

    May 05, 2018

    Stocks - Gain required to fully recover from a loss

    Gain required to fully recover from a loss

    Posted: 05 May 2018 07:26 AM PDT

    Graph related to this issue: https://i.imgur.com/0VMBY1q.png

    One of the many pearls of wisdom dispensed by Warren Buffett is "Rule No. 1: Never lose money. Rule No. 2: Don't forget rule No. 1". Unfortunately this is easier said than done in the real world. Fund managers are acutely aware of investor aversion to losses.

    Losses on portfolios can be due to market movements in the price of the investments or when investments go under or default on their obligations. The latter is permanent capital loss, as there is no opportunity to recover the losses suffered. African Bank is an example of this. Investors may get some of their capital back, but will unlikely get a material portion of it back.

    When suffering losses, an investor requires a return higher than the loss to return to breakeven.

    How do you deal with losses?

    submitted by /u/gorillaz0e
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    Young Investor Advice

    Posted: 05 May 2018 05:03 AM PDT

    I'm a college student looking to increase the risk in my portfolio. Right now I hold the Apple Google Microsoft and Amazon stocks, and I plan on holding those till I die.

    I have a long term horizon for my investments 10+ yrs, and I want to add some high risk high reward plays to my portfolio. It's unrealistic for me to expect the FAANGS to keep doubling, so I know I need to add some smaller cap stocks.

    My considerations right now are: PYPL (I know they are already near 100bn but I could see them growing 5x, as a millennial who uses venmo daily) TTD(Advertising is a huge growing industry and they're a tiny company so there's a huge runway) MU/SQ/SHOP(I have no clue why, but so many people seem insanely bullish on these, and I'm young so maybe YOLO?)

    submitted by /u/Jshmo4014
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    SEBI allows exchanges to increase market timing

    Posted: 05 May 2018 11:55 AM PDT

    As per Securities and exchange board of India circular dated 4th May 2018, SEBI is now allowing the exchanges to set up trading trading hours for equity derivatives between 9 AM to 11:55 PM. This means that the exchanges like BSE and NSE can now have the markets open till 11:55 PM only for the equity derivatives segment. The circular also states that, the exchanges will have to take a prior approval by submitting a detailed proposal including the framework for risk management, settlement process, monitoring of positions, availability of manpower, system capability, surveillance systems, etc.

    As per my understanding below are some of the pros and cons in case the market timings are extended.

    Pros/Advatages

    1. The most important aspect would be that this will help the markets to cover the trading hours for European exchanges and NYSE as well. If Indian markets are open during these hours, the volatility due to events happening over the globe would be covered during the market open hours and we may see less gap up and gap down opening which happen due to global events.

    2. With increased timings of the derivatives market, the participation will increase as the working professionals with 9 AM to 6 PM kind of jobs will also have some time to trade.

    3. Apart from volatility due to global events there are local events like result announcements post market hours which will now happen during market hours and again help to reduce gap up and gap down opening due to good and bad results.

    4. With increased trading hours, one may expect rise in volumes and any rise in volumes would bring in more revenue to the exchanges.

    Cons/Disadvatages

    1. While increased timings provide a bigger window to trade, the volatility index can go either way and we may see sudden spikes in the prices due to this.

    2. Since the extended hours are only for the derivatives segment and not for equity delivery (cash segment), this may result in creating an arbitrage between prices in cash market and F&O segment. Such arbitrage may be a risk for small investors as they will not be able to make quick entry/exit and will not even know the reason for sudden fall and then sudden rise in prices.

    3. Technical risks like server issues will have to be taken care as extended market hours would require very strong and reliable infrastructure for longer duration of time each day.

    Do check out some of my articles like

    How much I can earn from commodity market trading with Rs 50000?

    Equity futures vs Commodity trading

    submitted by /u/atal34
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    Good price to wait for Apple to hit before buying?

    Posted: 05 May 2018 01:51 PM PDT

    Beginner here, just wondering at what point you guys would buy in at. I expect to hold it long term, but don't want to wait too long to buy.

    submitted by /u/CrashKeyss
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    Solar boom in ca coming

    Posted: 04 May 2018 06:26 PM PDT

    So ca is set to pass a new law mandating solar power on new homes. With the 30% tariff currently imposed on foreign solar I'm assuming a few companies in the us will meet the demand. I'm looking to see what the community has to say about what this could mean.

    submitted by /u/sgtwtf22
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    How to bet against climate change?

    Posted: 05 May 2018 12:30 AM PDT

    I am wondering what stocks if there are any, will benefit from the reality of climate change in the next 10-20 years. I am a full believer of Climate change and I feel confident there is money to be made. Besides electrical car company's, is there some hidden jems going unnoticed ?

    submitted by /u/Noahiskurama
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    Apple said they will buy their share. What is benefit to shareholder?

    Posted: 05 May 2018 01:41 AM PDT

    After the news apple stock was rised. What is good for shareholer? Could you explain to me the mechanism?

    submitted by /u/zuelearth
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    SQ and V for a first timer?

    Posted: 04 May 2018 03:14 PM PDT

    Hey yall I'm gonna be investing in the stock market for the first time. I have $800 and I'm gonna invest in SQ and V, thoughts?

    submitted by /u/philbart_
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    My stocks have dropped 15% in 10 days. What should I do?

    Posted: 05 May 2018 12:30 AM PDT

    Hi, I'm from Indonesia and new in stock investment. So about 10 days ago I decided to buy 3 stocks consisting of 3 of the 5 largest banks in Indonesia with nearly equal portions each.

    My reasoning was that:

    1. I wanted to be safe so let's buy large banks stocks. Historically, the 1-year return was very good, 30%-40% and had always grew YoY. There's no chance of these banks going bankrupt.

    2. I thought in May, the price would soar, so I decided to buy a lot because I thought now is a good entry point.

    3. At first I wanted to invest and not trade. So I thought I wouldn't mind the volatility but now it got scary.

    I decided to spend about 75% of my asset to these 3 stocks. Shockingly, once I bought, the price dropped ridiculously since the very same day until now. Many believe that it will continue to drop until about September. This is so frightening.

    My mistake was:

    1. I didn't set any cut loss point. I thought I was gonna go for long term and I didn't think it was gonna end up this bad anyway. My mentality was "I just lose money on paper, but one day the trend will reverse inevitably". I thought I was gonna go for long term, but apparently I need the money to make more money.

    2. I invested too much for the first time, instead of doing a trial first. I really thought It was gonna go up.

    Please help me how can I save these stocks? I'm thinking to average down once it reaches it's lowest point. I can't afford to lose this much as a beginner.

    Alternatively, should I stop thinking about these 3 stocks at the moment and use what's left for investing in good bullish stocks?

    Thanks so much in advance.

    EDIT: Here's the stocks that I bought.

    On 24/04 : https://www.bloomberg.com/quote/BNGA:IJ

    ON 25/04 : https://www.bloomberg.com/quote/BBNI:IJ, https://www.bloomberg.com/quote/BMRI:IJ

    submitted by /u/wannabemanwhore
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    After this weekend...

    Posted: 04 May 2018 04:13 PM PDT

    Dear Redditors.. /:)

    Looking around for some fun.. Watching charts as Daily business I came across a well known bearish pattern again.. To my.. the hell breaks lusss on monday.. Full short on Euro Stoxx here, some commoditys are gonna get nasty swings next week.. wheat gonna hit the 480 and ~420 after.. Oil turning bullish and Will remain climbing.

    My thoughts.. everybody has thoughts, but.. Im curios how you are preparing for whats coming? Or.. did we already past the line? ;)

    submitted by /u/ToeTantRa
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