Daily advice thread. All questions about your personal situation should be asked here Investing |
- Daily advice thread. All questions about your personal situation should be asked here
- Lyft is threatening litigation against Morgan Stanley, accusing the firm of supporting short-selling
- Lesson of The Day: Rare coins & currency lose value over time, better off investing
- What do you guys think about Biotechnology ETFs?
- How do I explain to a friend that compound interest and stocks are not the same thing?
- I want to make my 2019 IRA contribution (TOTAL: $6k- I'm going to hold long-term whatever I buy; probably adding to my Schwab etfs), but the stock market is at an all time high right now. I think it's safe to say the market will go down at some point in the next year...
- Hesitant to invest
- Interesting article on how ETF can avoid capital gains tax using "heartbeats"
- Vanguard on Diversification
- Figuring out future financial moves (about 18 months)
- What happens to the stock of a company if they’re bought or are merged with another company?
- State why are we going past 27k on the DOW and are the trillion dollar valuations justified?
- How long until you give up on a stock?
- Vanguard ETF index funds tax efficiency vs regular fidelity index funds (Saves you around .20%)
- Options VS Cfd
- What are the downsides of investing all my money in Wealthfront
- Why is Barnes and Noble ($BKS) trading at a P/E ratio of 436.75?
- ELI5 - RIR - Can you please explain IRR to me ? + some other things
- Options: Short Vertical Spreads?
- Wash Sale Advice
- How can bond funds (such as VBTLX) occasionally drop? Aren't bonds essentially guaranteed? Are there any funds that simply never drop but just grow very slowly?
- Tax efficiency of VTWAX in a taxable brokerage account
- US vs International Exposure, am I way off base?
- Cyber security stocks?
| Daily advice thread. All questions about your personal situation should be asked here Posted: 06 Apr 2019 05:13 AM PDT If your question is "I have $10,000, what do I do?" or other "advice for my personal situation" questions. If you are going to ask how to invest you should include relevant information, such as the following:
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! [link] [comments]  |
| Lyft is threatening litigation against Morgan Stanley, accusing the firm of supporting short-selling Posted: 06 Apr 2019 08:53 AM PDT |
| Lesson of The Day: Rare coins & currency lose value over time, better off investing Posted: 06 Apr 2019 05:11 PM PDT I recently cleaned out my grandmother's house, and found a large box of coins and cash stashed in the back of her closet for their "rare" value. Among the coins were 3 90% Pure Silver Franklin Half Dollars from 1955. The three coins just sold for $16, or over 10.6 times their original face value - an awesome return at first glance. However, if the $1.50 was put in a very modest Certificate of Deposit and left to sit for the 64 years instead, the CD would be worth roughly $16 today as well. If you consider inflation, the coins did not appreciate in value, at all. And these coins have actual value, as they were minted with Silver. The special "rare" Blue Medallion $1 and Red Medallion $2 bills from 1955 fared far worse. I got $33 for $27 worth of $1's and $2's - a meager $6.00 profit. $27 in 1955 would be worth the equivalent of $255.00 due to inflation, meaning a loss of $222. So PSA for anyone who thinks coins and currency have special value due to "rarity," they really don't. Those special $2 bills you have and won't spend, you're far better off spending them now, then holding onto them. It's more of a hassle to sell the currency than its worth. [link] [comments]  |
| What do you guys think about Biotechnology ETFs? Posted: 06 Apr 2019 10:38 PM PDT So I am NOT a proponent of extreme risky stocks like biotech. I'm not knowledgeable enough in the area to feel confident in picking specific companies. There are also so many factors that could instantly wipe out the entire investment in a biotech company. HOWEVER the sector clearly also has huge opportunity for growth. So it got me thinking, perhaps biotech ETFs would be a decent option. I'm only 19 so I don't think a bit of risk is a bad thing, and my portfolio is set up for the long haul. The particular ETF I am looking at is XBI, however there are also some others. But with XBI for example there are about 120 holdings, and therefore the risk of investing in just one of those companies goes away. That's not to say it's not risky. It still will be a highly volatile sector, but I'm prepared to deal with volatility and can handle it fine. With the huge opportunity for growth though, I don't see many downsides in this type of investment compared to other sectors. And for my current financial goals I think adding this might be a good thing to do. For every biotech company that fails in the ETF, there will be others that succeed. And I believe that over time the successes should outweigh the failures to result in big growth, and that is well backed up by historical returns. So is there something I'm overlooking here? Is there any extremely risky thing about investing in this type of ETF that I'm not aware of? Like I said, volatility is not an issue. I'm very level-headed and would not be concerned at all about me panic selling anything. To add, are there any ETFs that I could look into that would be better than XBI, perhaps with a lower expense ratio or a more diversified portfolio? Thanks in advance! [link] [comments]  |
| How do I explain to a friend that compound interest and stocks are not the same thing? Posted: 06 Apr 2019 06:05 PM PDT The way I explained it to him was: Interest is something applied to loans/bonds, whereas when you invest you have a stake in the appreciation and/or growth of what you invested in. I said already these two things are not the same. Now the way I understand it, your earnings in the stock market may have a compounding effect but it does not make it compound interest. Notable differences in my opinion:
This is an example I used. You have 1000 dollars. A) you deposit into a bank which pays you 10% annual interest ( accrues daily, compounds monthly). At the end of the year you have 1105 dollars. B) you invest in stock xyz and it does not pay dividends. After the price volatility throughout the year, your return is 10% and you walk away with 1100 dollars. I think 3 and 4 were briefly touched upon in #1. Does anyone see a flaw in my logic? If I am thinking about this the wrong way could you kindly explain how? Otherwise can you explain a good way for me to show the difference. Tldr: there is a difference between compound interest and investing in stocks/etfs/indexes. If you agree please explain how I can explain it to my friend, if you disagree please explain how I am wrong. Edit: some typos Edit2: Conclusion so far I have come to based on some of the comments. They are the same if some factors align.
Which leads me to think that if you have to create these scenarios to make them be the same, then they are not. Aside from the fact that they fundamentally are different things. Edit 3: I see the flaw in my thinking that dividends had any effect on whether or not a stock compounds. As some fellow redditors have clarified a "stock is always compounding in that the return of one period always affects the return of the next." Edit 4: Some people are confusing accrual/compounding with compounding interest/interest on interest. Edit 5: So many people on reddit are ready to jump in and say they are the same thing. They are not, and to say that investment in equities are the same as the type of growth one would get from an equal return from a savings account is a misrepresentation of the volatility of the stock market and an assumption that the board was always green when it was not. How many people here have weak hands and would sell at a downward trend, the hypocrisy is unbelievable. [link] [comments]  |
| Posted: 07 Apr 2019 02:20 AM PDT Before you strangle me, I know timing the market is foolish and I may be answering my own question here. But I have about a year before I have to have made my 2019 IRA contribution (Apr 2020). If I wait for a dip later this year, am I technically timing the market? It just seems to make sense to wait for a dip (so long as it's greater than the current price). I'm also considering dollar-cost averaging, but does starting now at a market high make sense? Again, I know it's timing the market, but something about it seems counter-intuitive. Any thoughts, ideas would be appreciated. (I'm a 30M in CA) I'm still learning so no need to be condescending. [link] [comments]  |
| Posted: 06 Apr 2019 06:38 PM PDT Hello everyone . I have $150k in a credit union savings account. This credit union pays out 3.05% in interest ($4,500 a year for me) , which is why I keep all my money in there. I am 33 years old, no debt, married ( wife does not work ) 2 1/2 yr old son and another baby coming in July. I have 15 years until I am eligible to retire ( age 48 ) with a pension if I wish. I have a 2 bedroom apartment that I pay $1,200 for every month ( great deal ) I live in new jersey where house prices and property taxes are super high. My wife and I will probably wind up house hunting starting next year. My question is should I continue keeping my money in the credit union and earn a guaranteed 3.05% or how much money to move to my brokerage account as we reach the all time highs? I figure 20% down payment on a house will be about $70k. 6 month emergency fund would be $27k and 12 month emergency fund would be $55k. To stash the downpayment and a 12 month emergency fund would be about $125k of my $150k. My other investments are all in stocks 100%. Roth Ira that i have been fully funding for 3 years. Vanguard Total stock market index , Vanguard Total International Stock market and Vanguard reit ETF. Brokerage account with Fidelity. $6,500 in total In ITOT, IXUS and various marijuana company stocks. 457b fund through my job invested in nasdaq 100. I am only doing $50 a pay or $1,300 a year for now. I will keep raising the funding with pay raises. Anything that I invest from my savings in credit union would go towards my fidelity brokerage account and into the itot and ixus funds. They have low fees and are very tax efficient. Sorry for the long post. Looking forward to reading the replies, thanks. [link] [comments]  |
| Interesting article on how ETF can avoid capital gains tax using "heartbeats" Posted: 06 Apr 2019 09:46 AM PDT |
| Posted: 06 Apr 2019 09:33 AM PDT Thought this research was really informative. They look at the probability of outperforming the market with a random portfolio of n stocks. They looked at how things changed as n increased. https://personal.vanguard.com/pdf/ISGITO.pdf Interesting that you had a 10% chance at outperformance by picking a single stock. I like the buy the index and 1-5 stocks you think will outperform over the next 30 years. [link] [comments]  |
| Figuring out future financial moves (about 18 months) Posted: 06 Apr 2019 10:39 PM PDT A little background. I'm planning on separating from the military in about 18 months and moving to a different location upon separation (military will pay for that). But, if the market is going to a recession or at least slowing down I'm trying to figure out what is best for me because the timing which this may occur will directly conflict with my separation and may have to rely on my investments as an income supplement for a period of time (JP Morgan I think is who it was is expecting a 5% decline this year). So I'm trying to figure out my next move. I'm invested in 6 ETFs that average returns of 16.4% 1 yr, 111.95% 5yr, (24.3% ytd), approx 1.5% div yield with a 0.2% expense ratio average. Additionally, my only debt is my mortgage which is at a 4.00% APR. The following are the 3 options I am considering:
Thanks for the help in advance, I would just like to know what moves you would make. [link] [comments]  |
| What happens to the stock of a company if they’re bought or are merged with another company? Posted: 06 Apr 2019 01:28 PM PDT The talk of the BB&T and SunTrust merger got me thinking of this. Maybe someone can explain in that specific situation what happens when it actually becomes finalized? Thanks. [link] [comments]  |
| State why are we going past 27k on the DOW and are the trillion dollar valuations justified? Posted: 06 Apr 2019 06:05 PM PDT |
| How long until you give up on a stock? Posted: 06 Apr 2019 11:59 AM PDT What is the minimum amount of time you buy and hold a stock? [link] [comments]  |
| Vanguard ETF index funds tax efficiency vs regular fidelity index funds (Saves you around .20%) Posted: 06 Apr 2019 05:18 AM PDT You're looking at a +.20% difference in returns after tax offsetting the lower expense ratio on Fidelity 500 s&p 500 index in Vanguard's favor. Looks like that ETF index fund patent is legit. I would imagine this applies to FZROX and the other 0% expense ration fidelity fund. I think Fidelity has an awesome interface and app, but it looks like Vanguard gets you better returns at the end of the day. They should use this angle in their marketing (which i believe is weak). Their response to fidelity 0% expense ratio was poor in my opinion (lowered minimum investment for admiral shares to 3 k down from 10 k) This post talks more about it: [link] [comments]  |
| Posted: 06 Apr 2019 07:30 PM PDT Hello guys. What is the best alternative to short and why? right now i am thinking in cds they seem to be more easy. is it the right choice? thank you [link] [comments]  |
| What are the downsides of investing all my money in Wealthfront Posted: 06 Apr 2019 07:21 PM PDT |
| Why is Barnes and Noble ($BKS) trading at a P/E ratio of 436.75? Posted: 06 Apr 2019 03:07 PM PDT |
| ELI5 - RIR - Can you please explain IRR to me ? + some other things Posted: 06 Apr 2019 05:53 PM PDT I have seen a video or two on IRR, stuff is mostly above my head because that's all the study I've done. Can someone explain to me what IRR (Internal Rate of Return) is please ? [link] [comments]  |
| Options: Short Vertical Spreads? Posted: 06 Apr 2019 05:47 PM PDT https://www.youtube.com/watch?v=6_0SbRaHv1U In the video above this presenter gives a scenario at 5:15 where he puts a short vertical spread: Sell 100 Call @ 3.00 and Buy 105 Call @ 1.20. Next, we assume the stock has risen to $101 per share at expiration. This is where I get confused. Obviously the Buy 105 Call @ 1.20 is out the money so that will be worthless, but in the video the Sell 100 Call @ 3.00 is worth $1.00. How can this short option have value at expiration if we want the stock to go down in price? Also, I know the option is in the money on the buy side and sell side, but I can only see the price increasing to be a benefit for the buyer. Any help is appreciated [link] [comments]  |
| Posted: 06 Apr 2019 04:54 PM PDT I have a question regarding the Wash Sale Rule which is fairly new to me. Sold a fair amount of Long Term stock during the dip in October, but quickly bought back in from FOMO. However, I ended up losing quite a bit and on December 31st quickly sold and re bought to capture those loses from my yearly gains (or so I thought). This resulted in a large wash sale that I'm now paying for taxes for 2018 term. Regardless, my stake has now recouped those losses I tried to capture three / four months later. I am under the impression that the cost basis is offset now for the next time I sell? In other words, my actual stake in the stock is the price I re bought on Dec 31st + the wash sale losses (the ones I attempted to capture)? Any help here is appreciated! Thanks! [link] [comments]  |
| Posted: 06 Apr 2019 12:55 PM PDT |
| Tax efficiency of VTWAX in a taxable brokerage account Posted: 06 Apr 2019 04:10 PM PDT Does VTWAX qualify for the foreign tax credit and how does it compare to VTSAX in terms of tax efficiency? If I wanted to tax loss harvest, what funds could I purchase to replicate VTWAX at Vanguard? [link] [comments]  |
| US vs International Exposure, am I way off base? Posted: 06 Apr 2019 10:03 AM PDT I am wondering if the following weighting in my portfolio is way off base or something that seems pretty solid: 75% VTI (Large Blend US Market) 18% VXUS (Large Cap Foreign) 7% VSS (Small / Mid Cap Foreign) I plan on having around 90% of my investible money thrown into these funds, with the remaining 10% being my "professional gambler" money and taking some higher risk single equity investments. (I know this may not be advised but its more of a fun/learning thing and I do not have issues with the extra risk) Any advice would be greatly appreciated, thanks for the help! [link] [comments]  |
| Posted: 06 Apr 2019 09:56 AM PDT Hi All, Does anyone know of a cyber security stock that isn't terribly over valued (high P/E)? I've been looking at CYBR but can't get behind the price tag. Preferably a market cap between 10-50 Billion. Thanks! [link] [comments]  |
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