[Bloomberg] Day Traders Will Have Fun Until They Get Wiped Out Investing |
- [Bloomberg] Day Traders Will Have Fun Until They Get Wiped Out
- GNC files for bankruptcy, with plans to close up to 1,200 stores
- Wirecard AG files for insolvency
- Has anyone come across a quick cheat-sheet on all the different cloud companies organized by service provided?
- German multinational pharmaceutical and life sciences company Bayer reaches $10.5 Billion Settlement in suit that alleged key ingredient in Roundup causes cancer
- [CNET] Attorney General Becerra and City Attorneys of Los Angeles, San Diego, and San Francisco to Seek Court Order to Immediately Halt Worker Misclassification by Uber and Lyft
- (OXY) Occidental Petroleum outlook discussion
- Tradixa - Trading tech stocks, Nasdaq to new highs?
- Why does it seem like everything SoftBank touches is tainted in someway?
- Why is WDI filling for bankruptcy? How is it possible that no other firm wants to buy it out?
- Opinions on SQ?
- IMF June 2020 outlook : GDP-decline reviewed, from -3 % in April to -4.9 % today
- ACTTually it is a growth stock: Merger approved between ACTT and Whole Earth Brands ($FREE, $FREEW) - Starts Trading Today - June 25th
- Hertz's stock soars after Jefferies says CarMax, AutoNation may 'swoop in'
- Vending machine company good or bad?
- Thoughts on investing in Boeing and airlines?
- WKHS
- My Thoughts On Apples Growing Lead Over Its Competitors
- Cannot find nor recall what I'm looking for, reaching out.
- Understanding trades taking place during the evening
- Revisiting March lows is more likely than you think
- Thoughts on ET Partners (16% Yield)?
- How long is long-term?
- Wirecard – I was so wrong! (my experience report)
| [Bloomberg] Day Traders Will Have Fun Until They Get Wiped Out Posted: 24 Jun 2020 05:01 PM PDT One time when I was sitting in my college dormitory, I heard a whoop of joy from down the hall. My dormmate announced that he had just made $500,000 trading in the stock market, after having invested only a few thousand dollars. When I asked him how he did it, he grinned and simply said: "Call options." I spent the rest of the day reading about how this marvelous financial instrument could be used to make a fortune in a day with just a small initial stake. Of course, my lucky dormmate doubled down on his investment and ended up losing most of his money when the dot-com bubble burst a couple of months later. This saga illustrates the danger of day trading, especially with leveraged instruments such as options. After the 2000 tech bust, day trading declined, but the coronavirus pandemic seems to be driving something of a renaissance. Goldman Sachs Investment Research reports that the percent of trading volume in the stock and option markets from small trades has increased a lot since January, while discount brokerage TD Ameritrade reports that visits to its website teaching people how to trade stocks have nearly quadrupled. Robinhood, a trading app that offers zero-commission trades and a simple, video-game-style interface, had 3 million new accounts opened in the first quarter. Half of its new customers are first-time investors. Many online communities are filled with the standard elements of day-trader culture -- stories of fabulous fortunes gained, hot tips, trading systems and theories and so on. Coronavirus probably isn't the only reason for the boom in day trading. Brokers realized that they could offer zero-commission trades and make up for it with interest earned by lending out their cash balances. Mobile apps made trading easier and more fun than ever, and allowed new traders to start off with small amounts of cash. A new generation of speculators has no painful memory of the dot-com bust. But whatever the reasons, the new day trading mania is not likely to result in a happier outcome than the last one. There are many theoretical reasons and a wealth of empirical evidence to suggest that most day traders are wasting their money. One of the most important concepts in finance -- and yet seemingly one of the hardest to understand -- is that there are two sides to every trade. For a day trader to make money, someone else has to lose money. In the most optimistic case, the loser could be a normal person who needs to put money in or take money out of their retirement account, and who therefore doesn't worry much about the price at which they buy or sell. But most trades are not this. Instead, day traders are usually buying and selling either from each other, or from algorithms programmed by skilled, experienced financial professionals. If it's the former, their trading is a zero-sum game. If it's the latter, human day traders are very likely to lose because the people who program trading algorithms are typically very smart, and their computers can spot market-moving developments faster than people can. This is why professional human traders have been increasingly driven out of the market. A related problem is the idea of slippage. Day traders might think that because they're paying zero commission, their trades are free. But when a day trader places an order, a trading algorithm somewhere quickly figures out that they want to buy or sell, and raises or lowers the price accordingly, so that the day trader gets a less favorable price. Another reason day trading is a bad idea is that people often fail to understand when they're winning and losing. If the market as a whole goes up (as it has recently), many stocks will be winners. That can make a day trader feel like they won, even if they would have made as much or more money if they had simply bought an index fund and held onto it. This is especially true right now, when correlations between stocks are very high -- in this case, meaning many stocks are rising or falling together. Finally, day traders often don't understand the amount of risk they're taking. Call options of the type my college dormmate bought, for example, are a form of leverage -- you might make fabulous riches, but you're very likely to lose your money. One young novice investor tragically committed suicide after seeing his account generate large losses; though he probably misread the account statement, this incident drives home the point that investors may not be prepared for how much money they can lose with the trades they're making. A large amount of empirical evidence confirms that most day traders lose money. A very large 2004 study of Taiwanese day traders, for example, found that more than 80% lost money. A tiny number -- about 0.03% -- earned consistently large profits, but the odds of possessing this kind of skill are slim. Most studies of day traders in the U.S. and Finland yield similar results -- a few traders are consistently good, but most lose out. Day trading might therefore be a fun way of gambling for those who are locked inside waiting out the pandemic. But if regular Americans start betting large amounts of their money on individual stocks and options, they're courting financial ruin. If you want to day trade, the best thing to do is to bet only a small percent of your money to learn whether you're one of the few who has the skill to beat the market. Day trading should be treated like an expensive video game, not like a way of getting rich quick. [link] [comments]  |
| GNC files for bankruptcy, with plans to close up to 1,200 stores Posted: 24 Jun 2020 06:45 AM PDT GNC Holdings Inc. GNC, -6.89% filed for bankruptcy late Tuesday, as it expects to accelerate its plan to close at least 800 to 1,200 of its stores. The stock has been halted for news since late Tuesday. The vitamin and wellness supplements retailer, with about 7,300 stores as of March 31, said its stores will remain open, as the company has secured $130 million in liquidity, including $100 million in debtor-in-possession financing and $30 million from modifications to an existing credit facility. GNC, a majority of its secured lenders and Harbin Pharmaceutical Group Holding Co. Ltd., an affiliate of GNC's largest shareholder, have reached an agreement in principle for the sale of the company's business for $760 million, which would be executed through a court-supervised auction. The stock has rallied 74.2% over the past three months through Tuesday, but has tumbled 70.0% year to date, while the S&P 500 SPX, -0.66% has slipped 3.1% this year. [link] [comments]  |
| Wirecard AG files for insolvency Posted: 25 Jun 2020 01:41 AM PDT https://ir.wirecard.com/websites/wirecard/English/5110/news-detail.html?newsID=1988247&fromID=1000 Wirecard AG: Application for opening of insolvency proceedings 25-Jun-2020 / 10:27 CET/CEST Disclosure of an inside information acc. to Article 17 MAR of the Regulation (EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. Aschheim, June 25, 2020: The management board of Wirecard AG has decided today to file an application for the opening of insolvency proceedings for Wirecard AG with the competent district court of Munich (Amtsgericht München) due to impending insolvency and over-indebtedness. It is currently evaluated whether insolvency applications have to be filed for subsidiaries of Wirecard Group. [link] [comments]  |
| Posted: 25 Jun 2020 04:27 AM PDT I am looking for a quick cheat-sheet on all the different cloud companies organized by service provided. For example, Crowdstrike, Akamai and Zscaler are two companies that are in cyber-security. Datadog is in performance monitoring. Okta is in identity management. Each of these cloud companies seems to fit into a specific category with several competitors within that category. Other categories can be edge computing such as Fastly. [link] [comments]  |
| Posted: 24 Jun 2020 10:37 AM PDT
Very interesting outcome in the US judicial system. Both the FDA and European Union consider Roundup safe. Bayer can't even put a warning on the product because of that. Kind of worrying to see them taken through the ringer like that because of a bunch of anti-science anti-corporate sentiment. Bayer plans to continue to sell Roundup. Bayer is up ~2.25% on the announcement despite the rest of the DAX being down ~3.4%. [link] [comments]  |
| Posted: 24 Jun 2020 06:37 PM PDT OAKLAND — California Attorney General Xavier Becerra plans to file a preliminary injunction to compel Uber and Lyft to classify their drivers as employees, escalating a battle with major technology companies, based on a memo sent Wednesday morning from his office. Becerra and the attorneys of major cities filed a lawsuit earlier this year to compel gig tech companies to treat their drivers as employees, not independent contractors, per a newly operative California law that creates a statewide labor standard tilted more toward classifying workers as employees who must receive wage and benefit guarantees. Now Becerra and the city attorneys of Los Angeles, San Diego and San Francisco will seek a preliminary injunction to immediately halt what they call misclassification of drivers. Becerra said in a statement that the companies must "play by the rules" and live up to their obligations to pay workers adequate wages and provide protections like sick leave and unemployment insurance. "It's time for Uber and Lyft to own up to their responsibilities and the people who make them successful: their workers," Becerra said in a statement. That's not the way to do business in California." App-based gig work companies are battling the new law, CA AB5 (19R), arguing it would decimate their business models and deprive workers of flexible income. The companies have argued the law does not apply to their workers, which prompted the Becerra lawsuit. Uber, Lyft, DoorDash, Postmates and Instacart have committed more than $110 million toward passing a ballot initiative that would let their workers remain independent contractors. The companies are looking to the electorate after they were unable to sway the Legislature, and the courts are increasingly applying pressure. San Francisco District Attorney Chesa Boudin challenged DoorDash in court last week for illegally misclassifying its delivery drivers, another volley in a growing barrage of legal challenges to gig companies in California. Stacey Wells, a spokesperson for the industry's ballot initiative, blasted Becerra's latest move by characterizing it as "yet another malicious legal action against drivers that underscores exactly why we're pursuing the ballot measure." "It is baffling that anyone would seek to end this critical work, threatening 900,000 jobs, especially now," she said in a statement. Similarly, Uber previewed its likely message to voters in a statement assailing Becerra's actions. "When over 3 million Californians are without a job, our elected leaders should be focused on creating work, not trying to shut down an entire industry," the company said. [link] [comments]  |
| (OXY) Occidental Petroleum outlook discussion Posted: 24 Jun 2020 08:51 PM PDT Hi I am interested in how you all view OXY in the short and long term. I have an average stock price of $15.77 thought about taking profits at around $24 but decided not to -- current price $18.00. It has 78% institutional ownership which in my opinion should indicate that they believe in the company. Even had one analyst rating for target price recently increased to $33.00. They also just put a bidding date of July 1st for the land they are trying to sell in Wyoming. Recent attempts at selling assets haven't been successful and I can only find information on one potential buyer the Governor of Wyoming it says they have received interest from several other entities. They are seeking up to 700 million from the sale of this asset but will this even make a dent in their current debt of upwards of 40 billion dollars? In the last two weeks or so I have lost $6 of value on my shares so regardless I'm staying long at this point. [link] [comments]  |
| Tradixa - Trading tech stocks, Nasdaq to new highs? Posted: 25 Jun 2020 03:52 AM PDT Hello guys, I am currently trading with Tradixa broker and i like a lot trading stocks. Tech stocks are the ones I always pay attention. This Tuesday, the tech-laden US index rose to reach its twenty first all time high so far in 2020, according to The Wall Street Journal. In addition, the index had risen in 16 of the past 18 trading days, its best streak since 1999. The streak was driven by new all-time highs from Amazon, Apple and Netflix. So what r you trading these days? [link] [comments]  |
| Why does it seem like everything SoftBank touches is tainted in someway? Posted: 24 Jun 2020 10:12 AM PDT I know they have their hands in a lot of bags, but the last 3 big scandals I can think of - WeWork, Uber, and Wirecard - were all backed by SoftBank. That kind of bad press makes me want to stay away from anything that they are invested in. They do have a big stake in I guess that one good bet can make up for a few bad bets, but SoftBank just gives me the skeeves. Edit: they sold their T-Mobile stake just yesterday [link] [comments]  |
| Why is WDI filling for bankruptcy? How is it possible that no other firm wants to buy it out? Posted: 25 Jun 2020 03:18 AM PDT Correct me if I'm wrong, but WDI is a solid firm (apart from the missing $2.1B) with clients and working operations. The only problem they have now is that they don't have enough liquid assets to pay the short-term liabilities, isn't it? How is it possible that no other firm is willing to buy them out? I find it hard to believe that a company with those operations and reach is only worth now less than 500M eur [link] [comments]  |
| Posted: 24 Jun 2020 06:08 PM PDT At the peak before corona, SQ was hovering around 80$. Today they're above 100. How could coronavirus increase SQs stock by 25%? They own cash app yes but it's only around 20% of their revenue and is it really blooming that much with the virus? Square makes the vast majority of its revenue from point of sale purchases, where consumers swipe their card in Square devices. Most of their market must be mom and pop shops, small cap companies, malls, any brick and mortar store. How are they not getting slaughtered right now? Am I missing something? [link] [comments]  |
| IMF June 2020 outlook : GDP-decline reviewed, from -3 % in April to -4.9 % today Posted: 24 Jun 2020 06:17 AM PDT US is projected to experience a GDP contraction of 8 % ! « Global growth is projected at –4.9 percent in 2020, 1.9 percentage points below the April 2020 World Economic Outlook (WEO) forecast. The COVID-19 pandemic has had a more negative impact on activity in the first half of 2020 than anticipated, and the recovery is projected to be more gradual than previously forecast. In 2021 global growth is projected at 5.4 percent. Overall, this would leave 2021 GDP some 6½ percentage points lower than in the pre-COVID-19 projections of January 2020. The adverse impact on low-income households is particularly acute, imperiling the significant progress made in reducing extreme poverty in the world since the 1990s. » source : https://www.imf.org/en/Publications/WEO/Issues/2020/06/24/WEOUpdateJune2020 [link] [comments]  |
| Posted: 24 Jun 2020 10:34 PM PDT ACTT/Whole Earth Brands Is A Growth Stock On June 24, 2020, the shareholders of ACTT, a Special purpose acquisition company and Whole Earth Brands agreed to a merger and will begin trading as Whole Earth Brands, using the symbol FREE (warrants will trade as FREEW) on Thursday, June 25, 2020. The Company's trading price of approximately $11 is an excellent value for an upcoming growth stock. The Executive Chairman of Whole Earth Brands is Irwin Simon. Simon took his startup Hain Celestial (HAIN) public in 1992 at a $2 million dollar valuation. He aggressively grew the company by both expanding operations but more importantly identifying strategic M&A opportunities. Hain completed more than 50 acquisitions under Simon's guidance in the natural and organic industry during Simon's tenure at Hain. Brands developed and acquired by Hain include Celestial seasonings tea, Garden of Eatin, Terra chips, Almond Dream, Soy Dream, Rice Dream (milk-replacements) and the Greek Gods yogurt. By the time Simon left Hain in 2018 Hain had a valuation north of $3.5 billion. For those of you scoring at home – that is a return of equity of 1750x or 175,000%. Amazon (AMZN) and Beyond Meat (BYND)-like growth. Simon has already made it clear that they have the same game plan for Whole Earth brands. Not only will the stock become popular when it shows earnings quarter after quarter, but more importantly they will be consummating strategic acquisitions 2 or 3 times a year to accelerate the growth of the Company. The biggest mistake you can make is viewing ACTT through the lenses of its historical performance under its old management. It's a whole new ballgame once Simon gets his hands on the Company. Simon is a proven disruptor and value creator. At Hain, he disrupted the food industry by bringing to market organic and healthy alternatives that had not been previously available to the masses. So, besides the plainly clear fact that FREE is being sold on the cheap (see below), the new chief has a plan and will juice up the Company real-quick. For those familiar with cannabis companies, Simon was brought in as the savior to Aphria in January 2019, after they had major issues and were at risk of a hostile takeover. Simon has since cleared house and re-established the Company on stable growth trajectory, COVID non-withstanding. Additional Info: Background Whole Earth Brands, Inc. will start out with the business units of the Merisant and Mafco. Merisant is the leading brand in the sugar replacement with labels such as Equal, Pure Via, Whole Earth and Canderel. Mafco is a 100-year-old trusted supplier of flavors and ingredients including the Magnasweet and Mafco brands and licorice-based extracts and derivatives. These plant-based products are clean and natural and support keto and other-non sugar diets. Mafco supplies well-known brands such as Haribo, Hershey Chocolate, Mondelez International and Firmenich (world's largest privately-owned flavor company). Whole Earth has a global footprint as they service over 100 countries and have manufacturing facilities throughout the world. Whole Earth products are distributed in clubs and stores such as BJ's, Costco, Walmart, Target, Kroger, Safeway, Albertsons, Publix, CVS, Walgreens, Panera Bread and Starbucks. Growth Strategy Whole Earth has the potential to grow from 2019 actual net sales of $272M to over $1 Billion. This will be accomplished by (1) product innovation and product extensions (2) North American distribution growth (3) continued penetration into developing economies as well as further entrance into new geographies (4) tuck-in acquisitions of complementary targets. These acquisitions will further trigger additional geographic expansion and new M&A opportunities in vertical businesses. Financials and Valuation 2020 Estimated Financials For 2020, Whole Earth estimates it will net sales of $270-290M and pro-forma adjusted EBITDA of $63-67M. EBITDA is driven by sales margins of ~23-25%. The Enterprise Value (i.e. basis for purchase price) is $439M which is 6.75x of 2020 estimated PF Adjusted EBITDA of $65M and 7.6x of 2020 Free Cash Flows of $57.5M. This almost a 50% discount to comparable companies. Utz, an older and less growth-oriented company is being merged into a SPAC (CCH) as well and its price is about 3x as more expensive. It is being sold at an enterprise value of 17x of EBITDA and 20x of FCF. (See pg. 46 investor deck). Position to Take Both the commons and the warrants are cheap and have the potential for rapid growth. Now that the merger has been approved the risk of the warrants going bad has been taken off the table, and the upside with warrants is greater. For example, if the stock [$FREE] goes to $30 and you own one full warrant at a cost of $2.5, your total cost would be $14 ($2.50 for the warrant and $11.50 to exercise the warrant) and then once you receive your stock you would sell it for $30. Your profit is $16.00 on a $2.50 investment (the $11.50 is not part of the investment as you got back your money on the same day- buying and selling the warrant). In the end you had a $2.50 investment, with $16.00 in profit, or an 640% return on investment. Warrants don't expire for five years so you have time to let the stock fly. Note: I'm not a financial advisor. Don't trust anything I say about stocks. Not the owner of DDTG Global. Also note: Press release from early 6/25 of the merger which corrected the press release issued on 6/24. The 6/25 version is here: Irwin Simon, Your Executive Chairman, Interviewed by CNBC re: Aphria. https://www.youtube.com/watch?v=qrr39PnTh5U Background articles on Simon https://freemanmag.tulane.edu/2020/02/28/irwin-simons-second-act/ Investor Deck [link] [comments]  |
| Hertz's stock soars after Jefferies says CarMax, AutoNation may 'swoop in' Posted: 24 Jun 2020 09:14 AM PDT
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| Vending machine company good or bad? Posted: 24 Jun 2020 08:18 PM PDT Vending Machine Company? I been thinking about starting up a small vending machine business and I say small bc be with only like 3k but witch would get me started I'm in no need of quick money just want assiets. I understand you can grow from 4 machines to 6,7,8 and so on. Feel like me at 20 owning a house and truck with a car. I'm ready to start a little side hustle. [link] [comments]  |
| Thoughts on investing in Boeing and airlines? Posted: 24 Jun 2020 10:32 AM PDT I know the future of travel is sorta in jeopardy with Coronavirus and people's reluctance to travel. I've been watching Boeing for a while and it's at a great price right now, does anyone think it's worthwhile to invest in it now and hold onto it. Majority of my portfolio is for long term investing so I don't mind the red days too much. I'm also wondering everyone's thoughts on airlines like Delta, Southwest, etc. I know they suspended their dividend payouts which can be a dealbreaker to some people, but I'm just wondering everyone's thoughts. [link] [comments]  |
| Posted: 25 Jun 2020 03:42 AM PDT I haven't been this excited about a stock since VTIQ GOOD NEWS ITS EARLY AND STOCK IS HIGHLY UNDERVALUED First Energy has signed a letter of intent to purchase 250 Endurance electric pickup trucks The pickup will serve fleet buyers first and LM has a handful of letters of intent in its hands for various companies to purchase the Endurance UPS, USPS Among Likely Customers UPS announced plans in 2018 to buy 1,000 next-gen electric trucks Workhorse and UPS are also partnering on DRONE PACKAGE DELIVERIES for residential and commercial customers. Lordstown Motors has signed up Servpro, a fire-and-water-damage restoration company, as an initial customer. Servpro has committed to 1,200 trucks. A possible contract to supply 180,000 new usps vehicles is expected to be worth more than $6.3 billion This is a real STOCK with MASSIVE POTENTIAL Today Vice President Pence gonna introduce truck in OHIO. Bringing EV vehicles to a shutdown GM plant. Do your own research here are the links https://www.cnet.com/roadshow/news/lordstown-motors-endurance-reveal-electric-pickup-debut/ https://finance.yahoo.com/news/workhorse-nikola-investment-undervalued-hedge-195845321.html https://www.investors.com/news/workhorse-stock-jumps-electric-delivery-vans-win- [link] [comments]  |
| My Thoughts On Apples Growing Lead Over Its Competitors Posted: 24 Jun 2020 11:53 AM PDT I work in tech and hence I thought I'd share my thoughts on Apples tech and their impressive planning and execution. Let me preface this by saying that I am not qualified to judge whether Apple the stock is fairly valued however I can add some informed comments on why I think Apple has a very good moat in terms of technology and why Apple devices will continue to command a premium margin for many years to come : Long term planning + Vertical Integration Theres none of the move fast and break things culture over at Apple. They take the time to get things right. They also control all layers of the stack. Long term planning plus full control means that Apple can pull things off that its competitors would struggle with. Lets see what they just did at WWDC:
Privacy
Growing services story
Pieces falling into place for the next big product
Will all of these translate to sustained margins ? Will Apple Glass be a successful enough product ? I don't know. TL;DR - Its highly likely that Apple will continue to crush its competition in terms of UX and margins on devices. Eager to know what others on this sub think. [link] [comments]  |
| Cannot find nor recall what I'm looking for, reaching out. Posted: 25 Jun 2020 02:19 AM PDT Upon my readings I read that this site exists where investors can read customer and employees reviews on the companies they work for. Whereby they can review what they think of their employers and their jobs. Unfortunately I cannot recall what this site is called and unable to put the right information to Google to narrow or hit what I'm looking for. Does anyone know what I'm talking about? This would hugely add to my fundamental analysis. [link] [comments]  |
| Understanding trades taking place during the evening Posted: 24 Jun 2020 02:31 PM PDT Hey folks, hoping for a little clarity on trades after hours. Does every ticker (let's say in the S&P 500) trade every after hours? Do ETFs trade after hours as well? Sometimes I check a ticker and it's 0.000% after hours (maybe chance) but days prior it was trading after hours. And same with ETFs. I didn't think a fund like MGK would trade after hours but looking online I saw this ticker moving. [link] [comments]  |
| Revisiting March lows is more likely than you think Posted: 24 Jun 2020 07:22 PM PDT Despite the unprecedented rebound the past couple of months from the March lows, the stock market and economy faces lots of uncertainty in the coming months. First, you have the IMF giving worse economic projections than originally thought. Then you have the rapidly rising COVID-19 cases in the US and elsewhere across the world. It's very obvious that the virus is not contained and that a second shutdown is imminent. Most importantly, the Fed has actually not done much with its repo operations. Despite boldly claiming "unlimited QE" it seems they are being rather conservative with their repo operations, with them having reduced the purchases in corporate bonds significantly in the past couple of weeks. Add all this to Biden's rise in the polls, and I think a revisitation of the March lows is inevitable in the coming weeks, as COVID-19 cases rises, and a second shutdown commences. [link] [comments]  |
| Thoughts on ET Partners (16% Yield)? Posted: 24 Jun 2020 09:56 AM PDT Doubling your money with ET in 3 Years (16% Dividend Yield) I think there is a play here with oil prices recovering to $40 levels. Energy transfer partners dividend yield is 16%. Use Robinhood margin to invest $100 pay 5% annual interest in the margin, earn 32% - 5% = 27% per year. Management has repeatedly said they will not change dividend. Reinvest dividend for three years = 100 * (1.27)3 = 204. Stock can go up and down in value as well which can improve or hurt the return. Is the main risk here bankruptcy or dividend removal only? The 2 year put options are really cheap on this too, so it can potentially be completely hedged if willing to pay 10% total for the protection. [link] [comments]  |
| Posted: 25 Jun 2020 12:01 AM PDT Tryna decide on how long I want to hold my stocks. I am a long-term investor, however I was kinda wondering if companies can actually stay strong for 10+ years. I know a few do like Apple, Microsoft, Disney, McDonalds, etc...however not sure if growth stocks can stay strong for long time like SQ, NVDA, TTD, Shopify, or other growth stocks Don't most companies not actually stay strong for 10+ years? like only a handful do. Like GE or Cisco for example. They were humongous companies that seemed to be super strong forever but then kinda died down. (not an expert on those companies just using them as example if its possible for companies to actually sustain growth for long-term over 10-15+ years) [link] [comments]  |
| Wirecard – I was so wrong! (my experience report) Posted: 24 Jun 2020 10:55 AM PDT So im one of those guys, who invested in Wirecard and want to share some of my experience. Afterwards one is always smarter or what's the word? With Wirecard, I was actually really wrong. I think that you have to stand up for it and you should check whether you made a mistake in your investment decision. I want to work through that in this report. How did the investment come about, why did I hold on to the company despite the attacks of the short sellers and the reports of the Financial Times? No matter how the result turns out in the end, it is always worth thinking about your bad investments and questioning yourself even more self-critically. This is the only way, and I am convinced of this, to get ahead on the stock market. Why did I invest in Wirecard at all?I actually stayed away from Wirecard for a long time. I missed the price increases of the last few years. Before contactless payment became more and more popular, I did not have this trend on my screen. So I did not continue to deal with the company. In addition, until a few years ago I only and exclusively dealt with strong dividend payers. That has changed somewhat in the last 3 years. I have further developed myself and my investment style, as probably everyone does. Then the Apple Watch came to my wrist and the possibility to pay contactlessly with the watch everywhere. More and more people were doing it and the topic was more and more often covered in the media and relevant stock market magazines. Since I don't buy bank shares due to bad experiences, I had a gap in my portfolio. How do you fill it now? I decided on system providers who have their foot very far in the door. That was VISA on the one hand and Adyen and Wirecard on the other. I liked the story at Wirecard. Not least of all, that a man named Markus Braun is obviously such a passionate manager who managed to launch the store from nowhere into a world-famous corporation within a few years. Sales and profits knew only one direction. Due to the many untapped markets, the chance of a growth rocket emerged. Despite the already immense price increases – there was still plenty of room for the next few years. I dared the first small entry with 5 shares at a price of 135 Euro. The shortsellers are comingAt some point, the time was when the short sellers attacked and the reports in the Financial Times about inconsistencies in the balance sheet. For me it was a classic. I thought: Hey, we're talking about a DAX company here. Who else would you choose to attack from the DAX? The business is entangled and you need subcontractors or partners all over the world to be able to represent the transaction at all. It is difficult to see through that, even if you do everything right. A real find, then. Moreover, the price of the share had long since been geared to the growth of the company. That means that future growth was already priced in. Such shares are increasingly susceptible to volatility as those of solidly valued companies where the price reflects the business. So what did I do? Repurchased, of course! Why did I stick with Wirecard and what did I learn?I just couldn't believe it. It was beyond irrational. If I have to realize that you can't hide something like that forever, it should have been clear to a CEO of a DAX company long ago. Besides, every year there was a certificate and economic report from the renowned auditors. You look twice as much on the fingers of a DAX company. Wrongly conceived! That is the greatest learning in history. You cannot even trust the auditors to do their job properly. I have closed my eyes for too long in good faith that there are too many functioning control bodies. With my capabilities, I have to trust my gut. But even large investment funds like DWS, which can have insight into the company at any time, have been deceived. I am convinced that no small shareholder could have foreseen the fraud itself, but I decided for myself that as soon as shortsellers on a large scale start attacking a stock somewhere, I am OUT! We small shareholders have even less insight than the big boys and then such an investment quickly turns into a gamble. Since my money is too good for gambling I will keep my hands off such shares in the future. There are so many wonderful opportunities and companies, it is not necessary to take such a ride on the cannonball. What did I do with the Wirecard shares?I still have it! At the first massive slide last Thursday, I still thought something was wrong. Why does the auditor only come around the corner on the day the annual financial statements are published and say "Hey, we're missing 1.9 billion euros"? I thought it was clearing up. If I sell now, I'll have massive losses and tomorrow the price will go through the roof. On Friday, when it was clear that there was no 1.9 billion or the two banks did not know Wirecard as customers, it was too late to sell. All in all, I have never been heavily invested in Wirecard. I had and have a total of 20 shares. At a price of 80 euros I can sell them +/- 0. I have decided to sit out the dilemma. I have mentally written off the money but who knows: Maybe there will be a turn around story with new management at some point or another company or bank will buy Wirecard. In this sense, my thoughts are with those who had to cope with high losses with Wirecard. It shows once again how important diversification is. Do not put all your eggs in one basket. A good guideline is certainly that no position in the portfolio should amount to more than 5%. I do very well with a maximum of 2-3 %. But that also means a lot of work, as I have to deal with more and more companies all the time. It is important that you do not let your head hang down and question whether company investments are the right investment. To lie beside it belongs to it when investing. It is much more important to learn from it. To look the facts in the eye and to question critically where you could have done something better yourself. On the stock exchange, nothing is as important as experience – the good ones, and unfortunately also the bad ones! Are you invested in Wirecard or have you sold at a loss? I am looking forward to your comment. [link] [comments]  |
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