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.
- Tesla closes above $2,000 for the first time ever...
- U.S. weekly jobless claims jump back above 1 million
- Comparing major S&P 500 crashes of the last 100 years
- Square may be the next Tesla for finance/banking.
- Why is GOOG worth so much less than AAPL, AMZN, MSFT?
- How do you stop staring at your positions?
- What’s the point of dividend investing?
- As California requires ride-sharing companies to reclassify their drivers, Lyft will suspend operations in California at midnight
- I know you can't time the market, but is this an objectively *bad* time to enter the market? Are you making any new/big investments right now?
- FB is undervalued among FANGAM companies. Thoughts?
- There are plenty of TSLA bulls. How much are you up? Maxed out 401k and Roth IRA so I bought 2 shares in my Vanguard taxable (small gamble) the morning after 5:1 split was announced. What's your bull or bear thesis?
- Does it make sense to do both active and passing investing ?
- Which brokers allow email for 2-factor authentication?
- A little clarification on what it means to be a "Banker"
- First Payment Date Bond / Question?
- Europe Second Wave of Cases - DAX red 3 days in a row
- Becoming a First-Time Investor in a Venture Capital Fund
- Gold
- Best Renewables Company
- Built a portfolio mostly with stocks suggested on here . Any comments? No FAANGM
- Investing in Subset of SP500
- [URGENT] Hold or sell USD?
| Daily Advice Thread - All basic help or advice questions must be posted here. Posted: 20 Aug 2020 05:09 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]  |
| Tesla closes above $2,000 for the first time ever... Posted: 20 Aug 2020 01:05 PM PDT
Are we experiencing some major FOMO and irrational exuberance? Am I the only person in America that doesn't own Tesla stock? [link] [comments]  |
| U.S. weekly jobless claims jump back above 1 million Posted: 20 Aug 2020 06:30 AM PDT
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| Comparing major S&P 500 crashes of the last 100 years Posted: 21 Aug 2020 02:06 AM PDT Since we just crossed back into record high S&P 500 territory, I thought I would download the S&P 500 historical data going back over 100 years to compare the major market crashes. It turns out the Covid-crash had the fastest recovery of any 25%+ market drop, lasting only about 6 months. The second fastest was after the 1987 Black Monday crash, where the market dropped about 30% and the recovery took about two years. By comparison, during the Great Depression the market dropped about 86% and took 25 years to recover. Here's a look at the data charted: https://i.imgur.com/k2CMF9E.png And I should add, that while the crashes make headlines, it's important to remember that over longer periods of time, the market always goes up. Here's my preferred way to visualize the growth of the S&P 500 over the last 100+ years: https://i.imgur.com/8jd2nrD.png
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| Square may be the next Tesla for finance/banking. Posted: 20 Aug 2020 11:16 PM PDT Jack Dorsey is an amazing CEO. Being a tier just below Jeff Bezos, Elon Musk and Satya Nadella. With his success on growing and operating Twitter and Square so far. Even then I believe square is still undervalued compared to the major banks operating so far. Square market cap: 60 billion. JPM: 296 billion BAC: 301 billion CITI: 97 billion Yet square is the most forward thinking fin tech company and is evolving to replace traditional banking by adding on features such as the ability to purchase stocks, btc.trading, transfering funds between peers, and so forth. These features are arguably superior in quality to the current leading bank JPM. Furthermore their cash app was just released 7 years ago and today has an annual user growth rate of 50% / year. Their future plans will allow users to eventually taking out loans and square will actually open a bank in 2021. I believe that Jack Dorseys ultimate vision for Square will be to replace traditional banking as we know it. Square is Cathy Wood's 3rd highest conviction pick next to TSLA and NVTA. I think that this stock has tremendous value and will provide a 5-10x investment value even at today's prices. Possibly more than that. [link] [comments]  |
| Why is GOOG worth so much less than AAPL, AMZN, MSFT? Posted: 20 Aug 2020 10:54 AM PDT At time of writing, GOOG market cap is $1.06T and other tech giants are much higher (AAPL is $2.01T, AMZN is $1.65T, MSFT is $1.61T). That gap feels large to me. Also, FB is valued at $760B with much lower revenue and decelerating growth, so its gap vs GOOG seems small. Is GOOG a good buy? Are these other companies just overvalued? Curious what you all think.
Disclaimer: I own shares of every company mentioned here. Thanks for your input - I really enjoy this subreddit and have learned a lot from reading other posts. [link] [comments]  |
| How do you stop staring at your positions? Posted: 20 Aug 2020 05:58 PM PDT I have this horrible habit where whenever it crosses even the slightest part of my mind I have to open my account and look at my positions/news no matter the time of day or night. I have alerts set for both news and prices so I realistically shouldn't have to look more than a couple times during trading hours as the alerts are super slow to pop up sometimes (fix your app TDA) and my positions are long term holds anyways. How do you all just stop thinking about it and let it be? [link] [comments]  |
| What’s the point of dividend investing? Posted: 20 Aug 2020 11:18 AM PDT I see everyone and their mother on YouTube these days promoting Dividend Stocks and Passive Investing as the best thing ever. How true is this? I just can't see how buying into a dividend paying stock (T) could beat just buying into an S&P500 fund (VOO). For my example, sure you get a 7% dividend with AT&T, but the stock itself has dropped in value 10% in the last 5 years. Meanwhile VOO has gone up 71% in those same 5 years. Example after example I just can't find any that beat the performance of the S&P. Seems to me people would be better off sticking with an index fund. [link] [comments]  |
| Posted: 20 Aug 2020 10:27 AM PDT
Uber had also previously stated it would suspend operations as well. Both have said that they'll never be able to provide the same type of service under the new law, even if they do end up returning. EDIT: Looks like the courts postponed the requirement.
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| Posted: 20 Aug 2020 03:07 PM PDT I have my debts paid off, emergency fund, and contributing as much to my 401k as I can, so financially I think I'm in a decent position to start investing some of my cash, maybe like 10-15k. I can see myself using this cash within five to ten years but I don't have a firm goal date and am flexible, plus as a single 25 year old I have no idea what's in store for me when I'm 30 or 35. All that being said, right now just seems like a crazy time to be making big investment plays. Many people I know are still unemployed or working at places that are still suffering from the pandemic, but the S&P is basically back to where it was before shit started hitting the fan. None of my friends that trade are doing any trading right now (not that we should base the economy off of tech bros gambling on Robinhood but its worth keeping in mind). I know you can't "time the market" but I feel as if entering the market now is akin to entering in 2008. It just feels too risky. Are other people holding off too? [link] [comments]  |
| FB is undervalued among FANGAM companies. Thoughts? Posted: 20 Aug 2020 08:30 PM PDT I'm sitting on a War chest of 34K and feeling like I missed the train in March. After carrying out much research on the current valuations of FANGAM I have narrowed down to invest a 10% in FB. The recent analysis from Valuation Master Mr. Ashwanth Damodharan also provided the same thoughts on FB. [link] [comments]  |
| Posted: 20 Aug 2020 05:49 PM PDT Since maxing out my retirement accounts, I'm building cash in my Vanguard taxable for a home purchase in 5-7 years. With the recent TSLA split announcement, I figured why not play a bit with the thought that TSLA could mirror the action that AAPL has seen since its own split announcement. Fully aware splits don't create any new equity, but here we are. TSLA is the only individual stock I own since I much prefer broad funds. That said, after a week since split was announced, I'm up over 34%. I thought $1,464 was so high already. I've never owned a stock with this type of volatility. I test drove a Model 3 and loved it, but as someone who isn't closely following Elon and TSLA, do you actually think TSLA will ever match its fundamentals? Do you think the recent run up is actually driven by Elon and TSLA's actions or purely because of the split announcement? For the bulls, why do you think TSLA is justified at the current price? Do any of you who closely follow TSLA feel like the stock is too reliant on Elon (and his antics) and not its core business enterprises? [link] [comments]  |
| Does it make sense to do both active and passing investing ? Posted: 21 Aug 2020 01:12 AM PDT I know the usual advice is to put 100% into wide ETFs every month and wait. Does it make sense to do both ? Let's say 60 or 70% of my portofolio in ETFs (MSCI World for example) and just dumping a part of my paycheck in it every month without thinking while having 30-40% of my portofolio into hand-picked stock ? [link] [comments]  |
| Which brokers allow email for 2-factor authentication? Posted: 21 Aug 2020 02:45 AM PDT In other words, when you log in, it sends a message to your other email address, for you to confirm it's really you. The problem is that some brokers require other methods, such as text messages, voice calls, etc. I want to find a broker that allows email for that. [link] [comments]  |
| A little clarification on what it means to be a "Banker" Posted: 20 Aug 2020 03:36 PM PDT I'm fairly new to Reddit (at least posting, I've been a lurker for quite a while) and one thing I've seen quite a few times, and used myself is the term "banker". This may not be the place for it but I think it is important that people understand that there are countless jobs within Finance and many are not classified as a "Banker". Based on my time Banking I would classify "Banker" as one of three different types of roles. (the hierarchy is not based on the nobility of the job but rather on the sort of average size of transaction and economic focus of their job duties) High Finance - This would include people like traders/investment bankers and normally consists of what the laymen think as "Wall Street Banker". In all reality these people rarely meet with "clients" and are part of a fairly select group of people that are normally top of the class type individuals. These people are versed in mergers and acquisitions, commercial paper, equity issuance, large corporation financing etc. These Bankers normally focus on national and international economic trends verses regional or local trends. Middle Market Banker or Corporate Finance (sometimes referred to as "Commercial Banker") - These people you normally don't see in your local bank branch but sometimes will. They bank primarily businesses with borrowing needs between $500k and $250MM. These bankers are versed in what we call commercial lending, specifically giving loans and deposit products to small and mid sized businesses. Almost every community will have a number of these type bankers depending on the size of the community. Middle Market Bankers normally have their "boots on the ground" and understand national economic trends well but primarily focus on regional and local economies. Retail Banker (sometimes referred to as "Operations") - Retail Bankers are essentially what you see in your local bank branch. They are branch managers, tellers, small business bankers (usually less than $2MM in borrowing per client), mortgage lenders, etc. These Bankers are the most "boots on the ground" and connected with the local community. They normally do not focus at all on national or regional finance and focus almost exclusively on local economic trends. They are versed in the rules and regulations that are around opening and administering deposit accounts, residential mortgages, and consumer lending (cars, boats, etc). Please understand I'm not trying to be a "know it all" I just figured I'd type this up so when people not in the industry hear someone say they are a "Banker" they understand that it may mean different things to different people. Have a great day! [link] [comments]  |
| First Payment Date Bond / Question? Posted: 21 Aug 2020 01:17 AM PDT Hi dudes, Why is the First Payment Date of a bond important? There was a situation where the information about the first payment date of a bond was written as 10-06-2017 in Bloomberg and in another data platform on 10-09-2020, so it's a three day difference. One of them is wrong. What would happen if we used the wrong date? What are the consequences of using the wrong date? I got information about interest rate calculations or something, didn't quite get it. [link] [comments]  |
| Europe Second Wave of Cases - DAX red 3 days in a row Posted: 21 Aug 2020 01:16 AM PDT The second wave in Europe has begun again and its pretty aggressive. In the US the first wave never really stopped but now that cases are going up in Europe panic is bound to cause some sort of turn in the stock market. Due to the centralized banking system we cannot just print our way into to the green. However due to people not wanting to miss out again I can see that if we drop significantly 10%+ there will be a very quick bounce and then we are going to see a slow bleed of 30%+ over the next 24 months. [link] [comments]  |
| Becoming a First-Time Investor in a Venture Capital Fund Posted: 20 Aug 2020 04:20 PM PDT After I sold my first company, I found myself in the privileged position to invest in and support other young startups. I'd done a little angel investing myself, but I wanted to create additional impact (and generate returns) by investing in a venture capital fund. The problem was that I didn't really have a clear picture of what the process was like or what I could expect. As I started to think about investing in venture capital, my first instinct was to consult my financial advisor. And while having a financial advisor turned out to be a prudent choice for other reasons, I also found it to be limiting. Most advisors still stick to traditional markets like bonds, treasury bills, and stocks–which are an essential foundation for a secure portfolio but lack alternative assets like venture capital. I found a good way of thinking about the construction of my personal financial portfolio was through the lens of baseball. If there are nine people on my team, I obviously need several strong players with a consistent batting average (hitting those safe singles and doubles). These are the guys I send to the plate first. But my team wouldn't be complete without at least one slugger that bats third or fourth and goes for the fences (the slugger, in this analogy, being the venture capital in my portfolio). However, before I was able to make any big decisions, I needed to understand the basics of how venture capital worked. If you're thinking about investing in venture capital or you still aren't sure how it works, read below for a summary of who can invest, how the process works, and what an investor can expect. Language: Fund = The legal entity and pool of money that invests in startups. General Partner "GP" = The partner(s) making investments on behalf of the fund. Limited Partner "LP" = The partners that invest in the fund but don't take a day to day role in investment and operational decisions. When an "investor" invests in a fund, they do so as an LP. Management Company = The entity responsible for the day to day operations of the fund (and employs the GPs to manage the fund). What is a venture capital fund? When you become an LP in a venture capital fund, your money is invested into a portfolio of early or late-stage startup companies that are not yet publicly traded. The managers of the fund work to find, invest in, and nurture the next generation of innovative and promising companies. Fund managers also perform research and due diligence on the companies they are considering investing in. Every time a company in the portfolio has an exit (an acquisition, an IPO, a secondary sale), the LPs in the fund will receive a share of the profits. Who is qualified to invest in a VC fund? To become an LP in a U.S. venture capital fund, you must be an accredited investor. This means you have at least $1,000,000 in investable assets (not counting worth of personal residence) or have an AGI (Adjusted Gross Income) that exceeds $200,000 (or $300,000 together with a spouse). The SEC provides more detailed guidance here. What is the minimum amount that funds will take as an investment? Most smaller funds (<$25 million in AUM) allow you to invest a minimum of $100,000 but larger funds typically have higher minimums and require investments in the range of $1 million to $10 million. Do I have to fulfill my fund commitment all at once? It's worth noting that a fund commitment isn't called from the LP at once. Let's say you committed $2.5 million to a fund that raised $50 million in total. This means that over the life of the fund (typically around 10 years), the fund will call $2.5 million in capital. While 10 years is the total lifespan of the fund, the investment period (when the managers are most actively investing your money into startups) is usually around 3–4 years. Because of this, most funds will call capital (a portion of your commitment) mainly during the investment period. Assuming a 4 year investment period and a $2.5 million commitment, you would need to provide $625,000 every year for four years. When can I invest in a VC fund? Funds, just like start-ups, need to raise money. You can invest in the fund during the raise period, which typically occurs once every 3–4 years. What kinds of returns can I expect from VC funds? A good return on investment for an early-stage fund (an early-stage fund is one that invests in early-stage startups) is at least 300% of what you have invested in a period of 10 years. This yields an annual return of at least 12%. Cambridge Associates compiles an index and benchmarks for the venture capital industry for investors to reference. You can find past reports and research here. What kind of fees do funds charge? Similar to money managers or financial advisors, venture capital firms charge a management fee and a performance fee. The management fee usually falls between 2 and 5% of your committed capital amount per year. Collected fees are used as operating expenses for the management company to find, research, and fund the different startups that will ultimately go into the fund. In addition to this, you will also need to share 20% of your fund generated income with the fund managers (this is called carried interest). For example, if the fund invests $1 million into a start-up at a $10 million valuation, that buys the fund 10% of the company. After some time, that company sells for $200 million, and the proceeds from that sale are $20 million for the fund (assuming no subsequent dilution for simplicity). The fund will deduct 20% from the profits ($19 million in profits on the original $1 million investment, 20% of which is $3.8 million) of the sale and distribute the remaining 80% ($16.2 million) to the fund investors (LPs). If you had 5% of the fund you would receive $810,000 from that sale. What does the process of becoming an LP look like? When funds start raising money, they go around pitching investors (just like startups do). However, because venture funds are typically private investment vehicles, they do not solicit the public for investment. Once you get connected with a fund manager, he/she will show you their pitch deck (which typically details what types of companies the fund invests in, how much they are planning to raise, and what their competitive advantage or strategy for success is). If you love the fund and the people involved, you make a commitment. Once the fund has raised the minimum it needs to implement its strategy, there will be a closing of the fund and the managers will start calling capital to invest. What percent of each company am I getting? When you invest in a fund you are getting a percentage of the total fund. For example, if you invest $2.5 million in a $50 million fund you will own 5% of all investments that fund makes. Can I choose the companies that funds invest in? Typically, no. Most funds are "blind pools" and do not allow LPs to pick and choose what those investments are (though funds often appreciate referrals from LPs). How is my money invested? The partners of the fund are responsible for finding the most innovative and promising new companies to invest in. Though every fund has a different strategy and return target, a typical venture capital fund looks for startups with potential unicorn trajectories (companies that have the potential to be valued north of $1 billion). Their job is to identify up and coming companies, negotiate their way into a financing round with good terms, and perform fastidious research and due diligence on each potential deal (minimizing the risk of each investment as much as possible). How long is my money locked up? Most funds have a lifetime of 10 years, with the option to extend by a year or two, though large exits and distributions can occur much earlier. LPs in venture capital funds can expect their money to be locked up for multiple years (until stakes in startups are sold), but options such as the secondary market may allow LPs to sell their interests earlier (though usually at a discount). When will I recoup my money? In most cases, you start receiving your money back after each company the fund owns is sold to an acquirer or has a public offering. Funds typically have investment periods of 3–4 years, and a "harvest" period where companies mature and are then sold towards the end of the fund life cycle. 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| Posted: 20 Aug 2020 05:54 PM PDT Can't post charts here, but a clear correlation (not surprisingly, I guess) resides between Personal Consumption Expenditures as a % to Currency in Circulation, and the nominal 10 year treasury note yield. This is to say, since the 1960s, they move in tandem. Correlation is not causation, I get it. None-the-less, the correlation exists to the tune of 0.87, which spans 696 months. There's no relenting on currency growth... yes, the physical kind; even the M2 kind. I know there's much (more) talk about M2 growth, and rightfully so, but I am just looking at the most basics of basics. In any case, we are operating in a world of negative real yields again. A near-perfect symmetry exists between the real 10 year treasury note yield and the price of gold, i.e. the more negative the yield, the higher the price of gold moves. Again, nothing new here. As best I can tell, the excerpts I have read (can't recall the sources) of M2 growth and the concern with inflation appear unjustified, just gazing over historical charts. I don't even see a lag, i.e. M2 growth YoY leads to higher rates of inflation x-period later. Feel free to correct me if I am wrong. All this said, I am not seeing what I once believed, in that nominal rates will rise, even in the absence of the Fed enacting curve control, etc. If I were to best assume any structural change in rates at this point, going back to paragraph 1, it's currency in circulation being retired; this is a rare "phenomenon". I suspect inflation will be higher than 1% and, less any shock, less than 3% over the near to medium term as best I can read, which I am not all that literate on; again, feel free to chime in here if you believe these expectations are off the mark. Real rates likely to persist negative, and possibly extending lower, somewhere between negative 150-250bps. Only seems beneficial for gold. And for the record, I don't own gold in any form or gold stocks. I'm simply observing. [link] [comments]  |
| Posted: 20 Aug 2020 09:15 AM PDT Noam Chomsky was kind enough to answer my correspondence last night and he made a compelling case for renewable energy. However, I don't know much about which companies to support that will also reap profits going forward. I know individual tickers can be iffy busts. I'm considering Brookfield and HASI. What are some good renewable energy companies that aren't on shaky ground? [link] [comments]  |
| Built a portfolio mostly with stocks suggested on here . Any comments? No FAANGM Posted: 20 Aug 2020 10:57 AM PDT VRYYF The Very Good Food Co TECH: DT Dynatrace RNG RingCentral PRPL Purple Innovation IAC InterActive Corp WKHS Workhorse EV ERIC Ericsson PDD Pinduoduo FRSX Foresight Autonomous PHARMA: EXAS Exact Sciences ATHX Athersys ZLAB Zai Lab CVAC CureVac RDHL RedHill Biopharma URANIUM DNN Dennison CCJ CAMECO PUMGF Pure Point UEC Uranium Energy Corp [link] [comments]  |
| Posted: 20 Aug 2020 01:19 PM PDT Hey all, I'm interested in knowing whether investing in the top X stocks in the SP500 is a viable long-term strategy. For example, instead of just putting money in the SP500, you instead put your money in the top 100, or top 50, top 10, etc. Each stock would be weighted the same way that the SP500 weights its own stocks. Would this be viable? What would be potential upsides and downsides? I am not actually advocating for this strategy, but the thought crossed my mind and I wanted to hear some opinions. [link] [comments]  |
| Posted: 21 Aug 2020 01:41 AM PDT Recently looking to shore up my cash fund with almost 100k USD, now the USD is sitting in my bank account with almost no interest. With the EUR as high as it is, should I just bite the bullet and convert it now or wait for EUR downturns? Or convert half now and wait to see how the rest of the year goes? I kept most of my cash in USD due to its power, however, that purchasing power is lowering day, by day. I know if anyone could predict the future they'd be off making money and not shitposting here, but I still feel like I need some sort of advice or perspective. Any insight would be appreciated. [link] [comments]  |
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