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.
- Bankrupt Hertz Wants to Sell Up to $1 Billion in New Shares
- Don't give up your positions today!
- UK GDP falls 20.4% in April
- Moderna to start final testing stage of coronavirus vaccine in July
- NKLA is a fraud company (personal opinion)
- Are we living the biggest bull trap in history ?
- Palantir to File IPO in Weeks For Possible Fall Debut
- What's The "Craziest" Investment You Ever Made That Paid Off?
- I'm so confused with what the Federal Reserve is doing...
- If you are worried & not excited about the next dip, you shouldn't be deluding yourself by thinking your "investing"
- Initial Jobless Claims For the week ending on June 6, 2020: 1,542,000
- The Federal Reserve's Balance Sheet changes as of June 11, 2020
- Is The Fed Driving An Asset Bubble?
- Do I Rent + continue to invest in the stock market or eventually withdraw and then buy property?
- Amazon reportedly faces EU antitrust charges over use of third-party seller data
- With low rates where will you park your cash?
- Investing by following hedge funds/institutional ownership.
- Is it possible to claim tax refunds for pending years in one go?
- Retail investing and Friday rally correlation
- Why doesn't the stock market suffer from the Winner's Curse? Why doesn't the endowment effect create a market that has very little trading volume?
- Realty Income Corp (O) debt to equity
| Daily Advice Thread - All basic help or advice questions must be posted here. Posted: 12 Jun 2020 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:
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! [link] [comments]  |
| Bankrupt Hertz Wants to Sell Up to $1 Billion in New Shares Posted: 11 Jun 2020 06:32 PM PDT https://www.wsj.com/articles/bankrupt-hertz-wants-to-sell-up-to-1-billion-in-new-shares-11591917121 Rental-car company Hertz Global Holdings Inc. wants to capitalize on the rally in its stock seen earlier this week by selling up to $1 billion in shares, despite a bankruptcy that threatens to wipe them out. Hertz's shares rose to $5.53 earlier this week, a nearly 10-fold increase over their closing price of 56 cents following the company's May 22 bankruptcy filing. Now the company is asking a bankruptcy judge to approve a deal with Jefferies LLC to allow the potential sale of 246.8 million unissued shares. "The recent market prices of and the trading volumes in Hertz's common stock potentially present a unique opportunity" for the company to raise capital on more favorable terms than the strings-attached loans that many other bankrupt companies get, the company's lawyers said Thursday. The price of Hertz stock has fallen from this week's earlier high, closing Thursday at $2.06 a share, but the company said its stock is still actively traded. Jared Ellias, a law professor at the University of California Hastings College of Law, said he has studied hundreds of bankruptcies and never seen a company try to fund a case with an equity offering at the start of chapter 11. "Hertz looks at the market and sees there is a group of irrational traders who are buying the stock, and the response to that is to seek to sell stock to these people in hopes of raising some amounts of money to fund their restructuring," Mr. Elias said. Hertz shares trade on the New York Stock Exchange, which has moved to delist the company. Hertz has appealed the NYSE notice of delisting. Shares of bankrupt companies are typically worthless, save for rare instances in which the debt is repaid in full and money is left over for equity holders. The shares would have to sell for more than $4 each for Hertz to hit $1 billion. Hertz's roughly $3 billion in corporate bonds were trading earlier this week at around 40 cents on the dollar, indicating little faith among creditors they will be repaid in full. A Hertz spokesperson wasn't immediately available for comment. —Alexander Gladstone and Peg Brickley contributed to this article. [link] [comments]  |
| Don't give up your positions today! Posted: 11 Jun 2020 10:23 AM PDT This is a message for newer investors, because I know there are a lot of you. DOW is down 5.5% as of this writing. DO NOT give up your positions on days like this. That's how they (and we who are buying today) get your money. As long as you HOLD your positions you will be safe, and you will likely make up your losses within the next week. But you can't do that if you sold out of your positions. If you have solid positions with good companies or index funds, DON'T panic sell. If you do, you are basically handing me your money. And to be perfectly honest, I don't need it as much as you probably do. I looked at my portfolio just now, i'm down $20,000, and I didn't bat an eye. Just thought to myself, "I hope the newbies don't make any bad decisions today" and back to my coffee and enjoying my family. And that isn't even that much. Some people saw six figures down today. They're probably sitting on a beach somewhere sipping Coronas. Do you want that to be you someday? You won't get there panic selling. If you are 25 and barely have an emergency fund and you are down a few thousand bucks, I don't want your shares. I've got lots. YOU need them, and you need to learn how to hold on to them. [link] [comments]  |
| Posted: 12 Jun 2020 01:25 AM PDT https://www.bbc.co.uk/news/business-53019360 The UK's economy shrank by 20.4% in April - the largest monthly contraction on record - as the country spent its first full month in lockdown. The Office for National Statistics (ONS) said the "historic" fall affected virtually all areas of activity. The contraction is three times greater than the decline seen during the whole of the 2008 to 2009 economic downturn. But analysts said April was likely to be the worst month, as the government began easing the lockdown in May. [link] [comments]  |
| Moderna to start final testing stage of coronavirus vaccine in July Posted: 11 Jun 2020 06:00 AM PDT What timing!
[link] [comments]  |
| NKLA is a fraud company (personal opinion) Posted: 11 Jun 2020 01:27 PM PDT Ok maybe far fetched but here is why I believe Nikola's surge is completely unjustifiable.
Market Caps: Nikola: $25B Ford: $24B Realty Income: $20B Delta Airlines: $17B Carnival Cruise Line: $14B American Airlines: $6B You read that right, a company with no revenues, no production facility, and no operations, is larger than a Big 3 car manufacturer, one of the largest and growing real estate companies, 2 goddamn airliners, and a global carnival cruise line. Watching their videos on YouTube explains most of it though, they are very convincing in their marketing and personalities. Point blank, they look cool and revolutionary but they are missing everything else. The stock is currently trading around $60/share, and this... this my friends has taught me so much about market manipulation. It's a great story to tell though and I have to give it to the Nikola team, they're essentially a shell company who are in the process of yeeting billions of dollars of investors money and all it took was a few pictures of a concept car and 2 prototypes. Congrats Mr. Milton. [link] [comments]  |
| Are we living the biggest bull trap in history ? Posted: 11 Jun 2020 06:48 AM PDT Its getting pretty clear to everyone that the market is more and more decorrelated with real economics. In the standard anatomy or a bubble we usually see a bull trap following the first big dip. If we consider that the first big dip ended on march 23 its been quite awhile that this bull trap is going on. Which asks the question: was it a real crash, or just the news effect of the pandemic and lockdown had on the markets? By "real crash" I don't mean the sudden drop in stock prices definition, but rather i mean end-of-cycle crash. And this is quite different, by Kondratieff and Schumpteter this kind of crash does not happen because of a news but rather a news is the detonator of a crash that was bound to happen. 1 it that has to inhale, inflate, create money and debt to sponsor innovation. During this period, the new products and services start appearing in the market. These products are more effective and thus displace the old ones and thus decrease their demand in the market and their margins. 2 at some point it also has exhale, as the not-so-new business starts repaying their debts, the economy tends to shrink, old products and services incur losses, Investment declines and unemployment starts. By this definition we might think of the current market a the true continuation of the 12 year bull run, and the coronavirus crash as just a major event that impacted the market. The markets were not ready to burst when in happened and will continue to climb until irrational exuberance is unbearable and any small spike will make it burst into the real end-of-cycle crash. TL:DR We should not analyse the coronavirus crash the same way as 1929, 2001, 2008 or any other end-of-cycle crash, but rather we should see it as a major news impacting the market. [link] [comments]  |
| Palantir to File IPO in Weeks For Possible Fall Debut Posted: 11 Jun 2020 09:40 PM PDT Interesting to see considering they seem to be a very secretive company. Does anyone have some insight on the company? It was co-founded by Peter Thiel. [link] [comments]  |
| What's The "Craziest" Investment You Ever Made That Paid Off? Posted: 11 Jun 2020 09:16 PM PDT I'll start: Buying 20 delta calls on a 3x leveraged ETF. A bond fund, to be exact. And at the exact same time as a FED meeting. I'm sure they'll be a ton of crypto comments ITT but I'd like to see some other trades as well. Maybe some wild IPOs? Or perhaps you had puts on a "Insert-Black-Date-Here?" So, what's yours? [link] [comments]  |
| I'm so confused with what the Federal Reserve is doing... Posted: 11 Jun 2020 09:52 PM PDT With everything that's going on right now with our financial crisis, I hope someone can clear up my understanding about the trillions that being pumped into the market. My understanding is back in March 2020, when the market crashed thanks to Covid-19, the Feds decided to conduct repos where they will be buying bonds/securities from the open market so the open market can have more liquidity (aka cash). I spent hours searching and trying to understand the relationship between the Feds and the Treasury and where they get their money from but it seemed like the more I read, the more confusing I got. Can someone pls explain or dumb it down for me about how this whole situation works. So did Treasury (Mnuchin) asked Congress to approve trillions of dollars of securities so they can sell it to citizens, banks, etc. to have cash? and then the Feds went to buy back those securities to pump back cash into the market? Isn't this just like selling and borrowing against themselves? Ik my question is probably really dumb but I hope some of you can be kind enough to explain to me. thank you! [link] [comments]  |
| Posted: 11 Jun 2020 03:21 PM PDT Don't get caught up by the random stories from anonymous Redditors "oh yeah I made 800% of XYZ in two years, wish I bought it earlier though"... half of those are probably blatant lies and the other half of them don't normally discuss the rest of their picks and their total portfolio position. I wonder how many bags they are holding too? Sure some people might beat the indexes from time to time, but to think it's any more than lucky speculation is just ego-tripping. In uncertain times, all any true investor (anyone that will not be selling anything for atleast the next 5 years, preferably more) has to do is think about this gem from the great man himself WB - if you were eating hamburgers for the next 10 years and didn't have any stake in meat production, would you want the prices of burgers to be low or high?? Dips are just opportunities to buy some discount burgers!! The thought of a dip should be getting an investor salivating, not stressing with fear. If you are stressed out by the thought of a dip that means you are either a) speculating (and belong at r/wallstreetbets) or b) overextended. If you fall into b) think about your overall financial position before you buy any more shares. Do you have any high interest debts? If you were fired tomorrow could you live comfortably for 3-6 months without a wage? [link] [comments]  |
| Initial Jobless Claims For the week ending on June 6, 2020: 1,542,000 Posted: 11 Jun 2020 05:30 AM PDT Source: https://www.dol.gov/sites/dolgov/files/OPA/newsreleases/ui-claims/20201216.pdf Initial Jobless Claims: Survey: 1,550,000 Actual: 1,542,000 Prior Week: 1,877,000 Prior Week Revised: 1,897,000 Continuing Jobless Claims: Survey: 20,000,000 Actual: 20,929,000 Prior Week: 21,487,000 Prior Week Revised: 21,268,000 Total Jobless claims in the last 11 weeks: 42,042,000 [link] [comments]  |
| The Federal Reserve's Balance Sheet changes as of June 11, 2020 Posted: 11 Jun 2020 02:13 PM PDT https://www.federalreserve.gov/releases/h41/current/ Scroll down to 4. Consolidated Statement of Condition of All Federal Reserve Banks The takeaways are the following: The fed bought $16B in US treasury securities over the last week. The total amount of treasuries in the balance sheet stands at $5.9T No change in the amount of commercial paper. The total amount of commercial paper in the balance sheet stands at $12.7B The fed bought $1.2B in US corporate bonds ETFs over the last week. The total amount of corporate bond ETFs in the balance sheet stands at $37.3B No change in the municipal credit facility. The total amount of the facility stands at $16.07B A new addition to the balance sheet was established: A Main Street lending credit facility. The Fed opened the facility setting aside $31.8B. Not entirely sure how this facility operates. If anyone can chime in it would be welcomed. [link] [comments]  |
| Is The Fed Driving An Asset Bubble? Posted: 11 Jun 2020 07:58 AM PDT Asset valuations There is a growing school of thought that the Fed and other central banks are driving an asset bubble when the evidence is wanting. In fact, I'd go further than that and suggest that the Fed can stimulate away and should tolerate richer asset valuations yet.
Rebound expectations
Is all of this durable? Some will argue this time is different and that we'll never return to the same activities. I wouldn't be so sure. As sophisticated as humans like to think we are as a species, we are not. We never change, or maybe we just adapt and move on by doing things differently, spending money in different ways or on different things with varying time periods toward a full recovery. History offers abundant evidence. I've been doing this gig in one form or another for about a quarter century which is just barely enough time in the grand sweep of history's humbling lessons to have learned that every time a shock arises, we're told we'll never be the same again and things will never return to some sense of normalcy. We do. Every time that view turns out to be dead wrong. One of my favourite examples was when demographics best sellers told us during the early 1990s recession that an aging population meant fundamentally changed behaviour and we'd never have another housing boom after the 1980s. Oops. Commentary from Scotia Bank: https://www.scotiabank.com/content/dam/scotiabank/sub-brands/scotiabank-economics/english/documents/closing-points/closingpoints_2020-06-09.pdf [link] [comments]  |
| Do I Rent + continue to invest in the stock market or eventually withdraw and then buy property? Posted: 11 Jun 2020 12:41 PM PDT I'm kind of confused. Lately I've been buying and holding index funds. So far I've been investing all of my left over cash, however I'm still living at home. I've invested 15k total since the pandemic started. But I do want to leave eventually. I'm just wondering whether or not to eventually just rent and keep on investing in index funds until the dividends + long term gains outweigh the cost of rent... or withdraw it as soon as I can afford a down payment on a house? What is usually the better move? It seems that the ROI on property is the same as long term S&P 500. [link] [comments]  |
| Amazon reportedly faces EU antitrust charges over use of third-party seller data Posted: 12 Jun 2020 12:06 AM PDT Amazon to Face Antitrust Charges From EU Over Treatment of Third-Party Sellers (WSJ):
Also The Verge article [link] [comments]  |
| With low rates where will you park your cash? Posted: 11 Jun 2020 06:33 AM PDT I'm betting that with rates remaining so low many will not just let cash piles burn on the sidelines in savings accounts. Do you put your cash in bonds, does that keep up with inflation? My long term bet is that more and more money will flow into equities. [link] [comments]  |
| Investing by following hedge funds/institutional ownership. Posted: 11 Jun 2020 09:01 PM PDT What are some pro and cons on using this strategy? My understanding is that you shouldn't blindly look up tutes ownership because it is misleading. Most hedge funds run their model and invest in these companies to diversify. They also got in at much lower prices than we would get in the secondary market. Not to mention that they will only disclose if they have exited their position during quarterly report. If they own less than 10%, you wouldn't even know if they exited long before they announce it. [link] [comments]  |
| Is it possible to claim tax refunds for pending years in one go? Posted: 12 Jun 2020 06:13 AM PDT Due to various personal reasons , we have not claimed refunds for last 4 years. The last refund check we got for just one year was in tens of thousands. I don't know anyone who is as negligent as we are, it is quite depressing. My husband is the one who takes care of taxes and told me he would clear everything within two years and that he is waiting for some response or refund for so and so year ....bluh, bluh,bluh. The thing is we have never been current !! I want to take over the task now. So, Is it possible to claim for refunds for 4 years simultaneously or do I really have to wait until I receiver one? Thank you . [link] [comments]  |
| Retail investing and Friday rally correlation Posted: 12 Jun 2020 05:23 AM PDT Anyone else think it's weird to see positive finishes on Fridays along with above average retail investing? It would be interesting to see the data somewhere. I'm curious if people are getting their direct deposit Friday morning and blowing it on hertz calls/stock by the afternoon. [link] [comments]  |
| Posted: 11 Jun 2020 09:34 PM PDT More academic questions than a practical ones... Question 1: Why doesn't the stock market suffer from the Winner's Curse? "The winner's curse is a tendency for the winning bid in an auction to exceed the intrinsic value or true worth of an item." Every sale of a stock is essentially the end of an auction. So does it follow that the winner's curse is not applicable to stocks? Why wouldn't it be? Or is the winner's curse not a real thing? Or does the "perpetually repeated auctions" nature of stock trading fix the problem? Question 2: Why doesn't the endowment effect create a market that has very little trading volume? "In psychology and behavioral economics, the endowment effect is the finding that people are more likely to retain an object they own than acquire that same object when they do not own it" People who tend to own a stock, should tend to have a bias to value it more than people who don't own a stock. You would think this would create a wide gap between "bid" and "ask" and create a situation where not many trades are completed. Is the simple need for liquidity really driving such a high percentage of trades? Do you think the endowment effect combined with FOMO is a driver of the stock market's tendency to increase over time? [link] [comments]  |
| Realty Income Corp (O) debt to equity Posted: 11 Jun 2020 10:15 AM PDT I was researching the company for possible investment and one of the things I consider important is the debt to equity ratio. For O it's actually falling down down and the debt is increasing. Data: https://www.macrotrends.net/stocks/charts/O/realty-income/debt-equity-ratio What do you think, is that something to consider taking into account that Realty Income is REIT? I'm not looking for advice on buying it, but just a discussion on an interesting topic. [link] [comments]  |
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