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    Friday, January 3, 2020

    Home Unlabelled Vanguard now offering 0$ commission for all stocks and ETFs Investing

    Vanguard now offering 0$ commission for all stocks and ETFs Investing

    January 03, 2020

    Vanguard now offering 0$ commission for all stocks and ETFs Investing

    Vanguard now offering 0$ commission for all stocks and ETFs

    Posted: 02 Jan 2020 06:41 AM PST

    Dow jumps 250 points, hits record as Wall Street’s monster 2019 rally extends into the new year

    Posted: 02 Jan 2020 01:11 PM PST

    https://www.cnbc.com/2020/01/02/dow-futures-point-to-a-higher-open.html

    Stocks rose to all-time highs on Thursday, led by tech shares, as the strong rally in 2019 continued in the first trading day of the new year.

    The Dow Jones Industrial Average advanced 251 points, or 0.9%. The S&P 500 traded 0.6% higher while the Nasdaq Composite gained 1.1%.

    submitted by /u/FortyYearOldVirgin
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    Impact on markets from Middle East conflict?

    Posted: 02 Jan 2020 05:24 PM PST

    Qassem Soleimani, who is a prominent Iranian general was just killed by an airstrike in Iraq. If a broader conflict breaks out, is it time to sell?

    submitted by /u/ConcreteCrusher
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    why do 529 plans significantly underperform the market?

    Posted: 03 Jan 2020 02:41 AM PST

    I have a 529 plan for my son. it's NJ Best (https://www.njbest.com/), managed by Franklin Templeton. Here was 2019 and historical returns for the SP500 index all of the money is in:

    ​

    S&P 500 Index 529 Portfolio

    Total Annual Operating Expenses: 0.14%

    1 YR 3 YR 5 YR 10 YR: 16.06%,14.69%,10.76%,13.14%, 9.77%

    ​

    So in 2019 it made 16.06%. However, in 2019, the SP500 returned a whopping 30%: https://dqydj.com/2019-sp-500-return/

    This essentially means I've lost *HALF* my earnings due to... incompetence? I can't seem to open a 529 in my normal brokerage account through Etrade and manage it myself.

    So, why are 529s **vastly** underperforming?

    I'm looking into Vanguards 529 plan. It's through Nevada. Since New Jersey does not have a state tax benefit, I don't know what any downside would be.

    submitted by /u/counterweight7
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    Why don't big tech companies with $1000+ stock prices (GOOG, AMZN) do sock splits so that their share prices are in the $100 range?

    Posted: 02 Jan 2020 08:54 AM PST

    What are the best UK trading platforms?

    Posted: 03 Jan 2020 03:10 AM PST

    I'm looking at investing in shares and was wondering what are the best UK trading platforms suited for a beginner with a relatively small amount of cash?

    I would also like to learn more about trading and investing in the stock market in general so are there any books/courses/YouTube channels you would recommend?

    submitted by /u/TheEpicPye
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    The essays of Warren buffet: Dividend policy discussion

    Posted: 02 Jan 2020 09:09 PM PST

    In the essays of warren buffet makes the following thesis:

    "Dividend policy is often reported to shareholders, but seldom explained. A company will say something like, "Our goal is to pay out 40% to 50% of earnings and to increase dividends at a rate at least equal to the rise in the CPI". And that's it-no analysis will be supplied as to why that particular policy is best for the owners of the business. Yet, allocation of capital is crucial to business and investment management. Because it is, we believe managers and owners should think hard about the circumstances under which earnings should be retained and under which they should be distributed. The first point to understand is that all earnings are not created equal. In many businesses-particularly those that have high asset/profit ratios-inflation causes some or all of the reported earnings to become ersatz. The ersatz portion-let's call these earnings "restricted"-cannot, if the business is to retain its economic position, be distributed as dividends. Were these earnings to be paid out, the business would lose ground in one or more of the following areas: its ability to maintain its unit volume of sales, its long-term competitive position, its financial strength. No matter how conservative its payout ratio, a company that consistently distributes restricted earnings is destined for oblivion unless equity capital is otherwise infused. Restricted earnings are seldom valueless to owners, but they often must be discounted heavily. In effect, they are conscripted by the business, no matter how poor its economic potential."

    1. Why are restricted earnings discounted heavily in valuing the business? Shouldnt the discount rate on all projected cashflows be the same? Is it because in effect, money spent in maintaining a businesses competitive position(And hence its valuation) is an expense and if the money is not spent the value of the business goes down? I'm confused because I am from the school of thought that in valuing a business you simply discount all projected cashflows at a single rate. Can someone please reconcile this statement with say the dividend discount model in valuing a business.

    ​

    edit: typos.

    submitted by /u/Selection989
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    What are your thoughts on investing in trees through BetterGlobe?

    Posted: 03 Jan 2020 02:04 AM PST

    Dollar stumbles to nine week low against safe-haven yen as Mideast tensions flare

    Posted: 02 Jan 2020 11:40 PM PST

    Goldman Sachs: Learning From A Century of US Recessions

    Posted: 02 Jan 2020 06:28 AM PST

    CNBC had some really sensationalized reporting around this that was removed but the paper itself is quite a good read. Here's the highlights:

    —During the "Great Moderation" period before 2007, many economists were hopeful that various structural and policy changes had made the economy fundamentally less recession-prone. While this view took a serious hit in the crisis and the subsequent deep recession, we think many aspects of the Great Moderation are still intact, and some have even strengthened.

    —A review of the last century of US recessions highlights five major causes: industrial shocks and inventory imbalances; oil shocks; inflationary overheating that leads to aggressive rate hikes; financial imbalances and asset price crashes; and fiscal tightening. n

    —The first three causes of recession have become structurally less threatening, in our view. Better inventory management and the shrinking output share of the most cyclical sectors have reduced the impact of industrial fluctuations. The decline in the economy's energy intensity and the rise of shale have reduced the impact of oil price shocks. And better monetary policy has led to a flatter and more anchored Phillips curve, reducing the risk of inflationary overheating. n

    —The fourth cause, financial risk, has been the main source of recent recessions. Old risks could reemerge, and the growing financialization of the economy or shocks from abroad could create new risks. But for now, regulation and private sector restraint in the post-crisis environment have kept financial risk subdued. n

    —The fifth cause, fiscal policy, has historically meant major postwar demobilizations on a scale not seen since the Korean War. But here too, new risks could emerge in an era of political polarization, uncertainty, and dysfunction. n

    —Overall, the changes underlying the Great Moderation appear intact, and we see the economy as structurally less recession-prone today. While new risks could emerge, none of the main sources of recent recessions—oil shocks, inflationary overheating, and financial imbalances—seem too concerning for now. As a result, the prospects for a soft landing look better than widely thought.

    https://www.goldmansachs.com/insights/pages/learning-from-a-century-us-recessions/report.pdf

    In summary Goldman is saying that structural changes to the economy as well as relatively tighter fiscal and regulatory controls have lessened the risks of a hard crash. The idea of a soft landing economic event could be quite likely - think 2000-2002 but without the multiple compression in equity markets.

    submitted by /u/MasterCookSwag
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    Underperforming sub-sectors in S&P 500

    Posted: 03 Jan 2020 01:07 AM PST

    I noticed biotech and diversified chemicals sub-sectors have significantly lower and declining forward P/E over the last 7 and 3 years respectively than the other components of their sectors. Does anyone know off the top of their head why growth expectations declined so significantly for these sub-sectors in particular?

    (Diversified chemicals seems to only have BASF in the S&P 500, but biotech has 9 stocks in the S&P 500)

    submitted by /u/1-1-1-1-1-1-1-1-1-2
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    How do current affairs affect your investment strategy if you aren't day trading?

    Posted: 03 Jan 2020 03:21 AM PST

    For example, there's a lot of hype for WW3 right now. If I was day trading, I would likely want to see the market react immediately to these situations and respond appropriately. Because I'm investing with a 20+ year plan, am I really affected by short or medium swings in the market? Would it make sense to start investing in defence companies for example, breaking my current strategy?

    submitted by /u/apricotTuesday
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    Yahoo Finance shows premarket trading activity on several stocks at 6AM, but brokerages like eg Schwab only offer it starting at 8AM. why is that?

    Posted: 03 Jan 2020 03:18 AM PST

    Not Sure Where To Post This... But Investment Related

    Posted: 02 Jan 2020 05:30 PM PST

    About 15 years ago my father invested in a company in Kansas where he was living at the time.

    I hadn't heard much about the company but it never went out of business and it eventually did go on to turn over a profit year after year even though not major numbers but steady. My father passed away ten years ago and in the flurry of that I had forgotten about it. Until someone brought it to my attention that it was turning a profit recently.

    The CEO never contacted us about this and I remember my father made about a 50k investment in the company. Does anyone have any guidance they could give about how to proceed?

    I was surprised to find out they were turning a profit year after year.

    submitted by /u/ubichocolate72
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    I sold some stock for a total lose of $4500. If I sell MSFT for a gain of $3000, and immediately buy it back, does it mean that I never have to pay taxes on the $3000 gain?

    Posted: 02 Jan 2020 05:51 PM PST

    What's your thoughts on IQ option for trading?

    Posted: 03 Jan 2020 01:58 AM PST

    I want to bet against the market without leverage.

    Posted: 02 Jan 2020 06:03 PM PST

    Edit: Well FUCK could have timed that a bit better.

    European here for what it's worth.

    The FTSE/DOW historical chart and it's absolutely baffling. Working on the assumption that I think it's unsustainable in the medium to short term, what is a simple yet tried and tested way to bet against the market?

    Is the simplest thing to do to buy GLD now (with the assumption it will increase in value if/when the market crashes) to realise gains in the medium term (~2 years) and then buy FTSE/DOW at the dip as a long term (retirement) investment?

    submitted by /u/VetSurgeon
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    Excessive margin interest charge at TD Ameritrade

    Posted: 02 Jan 2020 05:59 PM PST

    I just contacted TD Ameritrade about this. I thought I'd post here as well. I just got dinged for $49.97 for margin interest which at TD Ameritrade's current 10.25% APR rate seems excessive - I would have had to had a $5,850 daily average margin balance over 30 days for that sort of a charge. However, I had a $1,500 - $2,700 debit balance over the past 30 days.

    Screenshot of account history: https://i.imgur.com/FRgDeTX.png

    Does the charge seem excessive to you? Has anyone else had problems with TD Ameritrade charging inflated margin interest?

    submitted by /u/Adderalin
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    AMD is trading at a PE ratio of 250, how is this not a massive bubble?

    Posted: 02 Jan 2020 07:43 AM PST

    Why do people tax loss harvest?

    Posted: 02 Jan 2020 09:18 PM PST

    I am in the business world but one concept always confused me. I understand that you can deduct capital losses on taxes for up to the threshold(3k) but I just can't fathom why people would willing lose money to simply get a deduction. I mean I guess I understand if they think they're stuck in a position that won't go anywhere but I've have read a bunch of posts where people will willing lose money for the write off! Is there anything else I'm missing?

    submitted by /u/brokestudent3
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    How do people utilize compounding?

    Posted: 02 Jan 2020 07:59 PM PST

    Forgive me if this question is beyond simple.

    From my understanding compounding, in relation to investors, only pertains to dividend reinvestment programs (DRIP). Is there a way to take advantage of compounding using capital gains?

    submitted by /u/cinco-de-garlicmayo
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    If I buy shares of AT&T into my Roth IRA and then the company goes bankrupt in 30 years am I just screwed or what

    Posted: 02 Jan 2020 10:56 PM PST

    So S&P is up yet again ... but Gold (GLD) is up even more. GLD is supposed to be a hedge ... yet its close to its 52 week high. Can someone explain the anamoly?

    Posted: 02 Jan 2020 09:38 AM PST

    ... anomaly (corrected)

    submitted by /u/vulcan_on_earth
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    If I consider all to be of equal safety and liquidity, would there be any reason to put cash in a CD or money market instead of a bond (fund)?

    Posted: 02 Jan 2020 10:21 PM PST

    Looking to park a lump of cash in something safe. I believe all three are:

    • Reasonably liquid
    • Reasonably safe
    • Tax efficiency: bonds, MM > CD
    • Yield: bonds > CD > MM

    The tax efficiency part is a little complicated, but i think i generally understand it. Are the above assumptions accurate? And essentially lead me to parking my money in a bond?

    submitted by /u/PM_ME_YOUR_BACKDIMPS
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