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    Daily Advice Thread - All basic help or advice questions must be posted here. Investing

    Daily Advice Thread - All basic help or advice questions must be posted here. Investing


    Daily Advice Thread - All basic help or advice questions must be posted here.

    Posted: 08 Aug 2019 05:14 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:

    • 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 significant other?
    • 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.

    Please consider consulting our FAQ first - https://www.reddit.com/r/investing/wiki/faq

    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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    Uber falls 10% after reporting disappointing quarterly results

    Posted: 08 Aug 2019 01:08 PM PDT

    Loss per share: $4.72, versus $3.12 expected

    Revenue: $3.17 billion versus $3.36 billion expected

    https://www.cnbc.com/2019/08/08/uber-earnings-q2-2019.html

    submitted by /u/pipsdontsqueak
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    Another Chinese bank looks to have collapsed, the third since May - Unit of China’s sovereign wealth fund takes over Xiao Jianhua-linked Heng Feng Bank in third case of nationalisation since May

    Posted: 08 Aug 2019 08:10 PM PDT

    https://www.scmp.com/business/banking-finance/article/3022056/unit-chinas-sovereign-wealth-fund-takes-over-xiao-jianhua

    If three US banks of this size all collapsed within a few months of one another like this it would be front page news. China looks to be at risk for a serious banking/financial crises... or already in one.

    Central Huijin Investment will invest in Heng Feng Bank to increase its capital adequacy ratio, improve its management and enhance its operational capability, according to a report by Shanghai Securities News

    Heng Feng is among more than a dozen city-level and rural lenders that had been put on notice by the authorities for a shake-up

    The Chinese government's first nationalisation of a private bank since 1998 has led to a collective collapse in the stock prices of China's listed banks, driving their valuations to record lows, amid fears that the shakeout would affect more lenders, and that the largest and best capitalised institutions would be called upon to bail them out.

    submitted by /u/NineteenEighty9
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    U.S. holds off on Huawei licences as China halts crop-buying, US futures down

    Posted: 08 Aug 2019 04:28 PM PDT

    My dad wants me to wait til the next market crash to begin investing?

    Posted: 08 Aug 2019 10:14 AM PDT

    I just turned 18 and I've got some money to invest, but he says I should avoid investing much until the next crash. Is this good advice? I feel like trying to time the market like that is a bad idea, at least when I'm playing the long game...

    submitted by /u/OmegaNut42
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    U.K. Economy Unexpectedly Shrinks for First Time Since 2012

    Posted: 09 Aug 2019 01:41 AM PDT

    Q2 GDP: -0.2%, compared to 0.5% growth in Q1. Recovery forecasted for Q3.

    Bank of England predicted 0% growth in Q2.

    Article

    submitted by /u/bennzo1238
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    Hedging against higher mortgage rates

    Posted: 09 Aug 2019 02:34 AM PDT

    Hi everyone! My wife and I are living in Switzerland and are considering buying an apartment. Real estate is crazy expensive because the system is designed in such a way that you never pay back more than 34% of your mortgage (I mean, you can but you don't have to and it doesn't make sense for fiscal reasons).

    Mortgage rates are very very low at the moment: we are talking less than 1% a year for a fix 10 years mortgage. The "interest only" system is therefore very attractive: if your mortgage is 1.2 million, with 1% interest, then you are only paying 1000 a month.

    My issue is: what happens after 10 years, at the end of the mortgage contract? Let's assume that rates go back to a more normal level, let's say 3%. Since the mortgage is not amortized, the monthly payments increase by a factor 3, which would make refinancing difficult. In addition if we take a longer mortgage, let's say 25 years at 1.5%, I don't really trust the bank to uphold the contract if 10 years from now, rates are at 3-4%: they will use every opportunity in the contract to call back the mortgage. So I want to be ready for higher interest rates, as if the mortgage was with variable interest rates. Which leads to my question:

    What is the best way to hedge against potential higher mortgage rates in the future?

    I am willing to lose a little money every year for "insurance" if in the case of a high increase in interest rate, I win big. Should I simply buy puts on a swiss bonds ETF? Is there a better option (no pun intended)?

    Thanks for your feedback!

    submitted by /u/arthur450
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    China may be willing to accept an economic downturn to hurt Trump and win a better trade deal

    Posted: 08 Aug 2019 06:43 AM PDT

    https://www.cnbc.com/2019/08/07/china-may-be-willing-to-accept-an-economic-downturn-to-hurt-trump-and-win-a-better-trade-deal.html

    "Many investors have expressed the view that China is prepared to accept an economic downturn (and thus a global economic downturn) to prevent President Trump's reelection," Naka Matsuzawa, Nomura's chief rates strategist in Tokyo, said in a note Wednesday following meetings with Asian clients.

    submitted by /u/brookhaven_dude
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    Robinhood gets approval to launch its popular investing app in the UK

    Posted: 08 Aug 2019 04:36 AM PDT

    https://www.cnbc.com/2019/08/08/robinhood-gets-fca-approval-to-launch-stock-trading-app-in-the-uk.html?&qsearchterm=robinhood

    Robinhood has been granted broker authorization from the U.K. Financial Conduct Authority.

    It's been building out a team in London led by former TransferWise executive Wander Rutgers.

    Recently valued by investors at $7.6 billion, the company claims to have 6 million users in total.

    submitted by /u/coolcomfort123
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    So who here is tracking the cannabis industry, what are your thoughts?

    Posted: 08 Aug 2019 05:52 PM PDT

    Im looking into CGC and some others in the watchlist, ACB. But the market is very speculative I think for the moment, but I don't known maybe in a couple of years , the industry has potential...

    submitted by /u/SkyDweller07
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    Silver is so cheap.

    Posted: 08 Aug 2019 03:57 PM PDT

    Been buying silver stocks for the past year or so. the Silver to Gold cost ratio right now is higher then it was at the peak of the recession, and is about 50% above the 20 year average, at over 90 to 1. It hasn't been this high since the gulf war.... Silver is poised to make breakout soon.

    https://imgur.com/msGtZOF. Just the past year for me. Expecting even more of a breakout.

    submitted by /u/raoulduke415
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    Would you feel headcount turnover in specific functions would be a useful report included in a 10k?

    Posted: 09 Aug 2019 01:04 AM PDT

    https://www.wsj.com/articles/uber-posts-its-largest-ever-quarterly-loss-11565295373?mod=mhp

    Reading over Uber's loss this evening, the thought occurred to me of what if there were metrics reported out around head count turnover in management and R&D functions?

    With how IP driven tech companies are, do you think it be useful to know if pre-IPO engineers and managers are jumping ship post-IPO or staying on?

    submitted by /u/rebal123
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    Questions... re: earnings and indicators...

    Posted: 09 Aug 2019 04:23 AM PDT

    Earnings:

    I just read a story that in this quarter over 70% of companies reported earnings that beat estimates. Yet, EPS don't seem to matter in terms of sentiment because guidance, QoQ, YoY determine how much the stock moves after earnings ate reported.

    So, why even look at EPS? It's obvious that analysts are underestimating them. The number is meaningless, especially with companies that are losing money, but still have good momentum.

    Indicators:

    Where can I find studies that report how accurate indicators are at prediction? How accurate does an indicator need to be in order for it to be considered "accurate", like a 50% correlation, a 20% correlation?

    I'm not interested in specific indicators for specific stocks, but generally. For example, how often does a double top predict s bearish turn? Also, is a double top a self-fulfilling prophesy? When people see a double top do they all start to sell thereby causing the prediction to happen?

    submitted by /u/Helm_hammer1
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    Why is lending still encouraged so much (with low interest rates) after the credit crash?

    Posted: 09 Aug 2019 04:22 AM PDT

    I understand that the interest rates were lowered in order to spur on the economy and recover from the crisis, but wasn't cheap credit one of the main factors in the crash, and won't this behaviour lead to another?

    Are levels of national debt so beyond repair that we will be stuck in a cycle of crisis after crisis until some form of global default brings people to their knees? How bad would that be?

    submitted by /u/TwitchingSparrow
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    S&P 500 dividends?

    Posted: 09 Aug 2019 04:14 AM PDT

    Howdy

    Does the s&p 500 Pay dividends ? If so, when, and how much?

    Thanks.

    submitted by /u/HODLmanHODL
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    How does an FX broker make money?

    Posted: 09 Aug 2019 04:04 AM PDT

    When we open accounts and deposit funds, we can use them to open positions in the market. There are people who are telling me my broker wants me to be successful, so they can keep earning commissions.

    But does it really work like that? My broker charges commissions only on withdrawals, spreads are tight and swaps can actually give me more money just for keeping position open.

    Therefore my question is - do they really want me to succeed? Because it feels like they want me to fail and they make money from people losing their deposits. When i'm successful in the market and withdraw, it's my broker that is losing money. Or am I missing something?

    submitted by /u/bomzay
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    Why has the market done so good in the last 10 years?

    Posted: 09 Aug 2019 03:51 AM PDT

    Looking at the S&P 500 graph over the last 10 years is insane (it went up like 4x).

    Why has the market done so good? Have we achieved superb efficiency as society?

    It feels huge tech companies (FB, Alphabet, Apple, Amazon) can't fail at all (which is a bad sign). But they have little or none debt at all, so how could they possibly fail?

    I am a total noob and I am scratching my head looking at previous recessions and trying to understand just a little about economy. It's total magic.

    What will cause another recession? Only debt can, right? But biggest companies don't have that much of debt. Do ordinary people do?

    I am going insane.

    submitted by /u/flyingtable_
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    Stock Market Investing Simulator?

    Posted: 08 Aug 2019 09:31 PM PDT

    Hi All!

    I read that for most investors in the stock market, it's best to just put X amount of money into an ETF consistently over a long period of time. I was planning to start with about $5,000 on the last day of each month, for 36 months. I dont' really have the time, knowledge, or experience to buy individual stocks, so I just wanted to buy ETFs such as VOO, SPY, etc. Every month for 36 months.

    Before I did this, I wanted to see how I would've done in the past. Had I started in 2007 for example, how I would be doing today.

    Is there any investing simulator which allows me to plug in $5000 worth of shares of particular ETF from X date to Y Date over a 36 month period to see how I would've done?

    submitted by /u/TheDynasty31
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    Why do investors buy negative-yield bonds?

    Posted: 09 Aug 2019 03:03 AM PDT

    To my understanding, bond yield is negative when the market price of bond is so high that it exceeds the present value of the bond. Then what is the point of buying a bond that guarantees a loss? Why don't investors just park the money?

    submitted by /u/dubbledot
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    Frontier said it wouldn't take any questions from investors during its quarterly earnings call yesterday

    Posted: 08 Aug 2019 05:32 AM PDT

    https://arstechnica.com/information-technology/2019/08/isp-frontier-is-failing-so-badly-it-wont-take-questions-from-investors/

    Frontier Communications yesterday reported lower revenue and a $5.45 billion goodwill impairment charge, and it warned investors that its revenue will continue to decline in future quarters.

    Frontier's financial performance is so bad that the company said it wouldn't take any questions from investors during its quarterly earnings call yesterday. Frontier reported second-quarter revenue of $2.07 billion, down from $2.16 billion in Q2 2018 and $2.1 billion in Q1 2019. Frontier also reported a net loss of $5.32 billion, though this was due to the goodwill impairment charge.

    Frontier also recorded a loss of $384 million related to the "disposal" of Northwest Operations, a four-state division that it is planning to sell to WaveDivision Capital. The sale isn't final yet.

    Frontier previously reported a net loss of $87 million in Q1 2019 and $18 million in Q2 2018. Frontier's capital expenditures—which include broadband expansions and improvements—totaled $275 million in the second quarter, down from $305 million a year ago.

    submitted by /u/COMPUTER1313
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    Comparing Total Equity Value to Enterprise Value

    Posted: 08 Aug 2019 10:55 PM PDT

    If Enterprise Value is what an investor would pay to acquire the whole company, does it make sense when projecting future cash flow at net present value to compare it to the enterprise value to estimate whether an investment is worth?

    Intuitively it makes sense to me since my investment return is simply the future FCF discounted to present value compared to my initial investment which is the Enterprise value.

    Is this the wrong way to look at it? Thanks!

    submitted by /u/gymaliz
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    Goldman Buyback Desk Saw Orders Rise ‘Dramatically’ During Rout

    Posted: 08 Aug 2019 11:53 AM PDT

    Investing In Virtual Market?

    Posted: 09 Aug 2019 01:17 AM PDT

    Hey, I dont know if this applies to this subreddit's rules, but what are your guys investing in virtual market?

    Here Its explained: https://www.youtube.com/watch?v=iLd0dFAmluU&list=PLF1Z73mPt4XVA1yEBrlNxS0kEqrfeNdW4&index=2&

    submitted by /u/Eds_boy
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    Investing in a Negative Interest Rate Environment

    Posted: 08 Aug 2019 05:32 PM PDT

    "Dividends don't fall nearly as much as stocks when the market gets crushed ... Taking out the Great Depression, there has only been a single instance where dividends fell double-digits (2007-2009)."A Wealth of Common Sense

    submitted by /u/czechyerself
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