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    Sunday, August 23, 2020

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

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


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

    Posted: 22 Aug 2020 05:10 AM PDT

    If your question is "I have $10,000, what do I do?" or other "advice for my personal situation" questions. If you are going to ask how to invest you should include relevant information, such as the following:

    • How old are you?
    • Are you employed/making income? How much?
    • What are your objectives with this money? (buy a house? Retirement savings?)
    • What is your risk tolerance? (Do you mind risking it at blackjack or do you need to know its 100% safe?)
    • What are you current holdings? (Do you already have exposure to specific funds and sectors?)
    • Any other assets? House paid off? Cars? Expensive significant other?
    • What is your time horizon? Do you need this money next month? Next 20yrs?
    • Any big debts?
    • Any other relevant financial information will be useful to give you a proper answer.

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

    Be aware that these answers are just opinions of Redditors and should be used as a starting point for your research. You should strongly consider seeing a registered financial rep before making any financial decisions!

    submitted by /u/AutoModerator
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    The first $100,000 is the hardest, Anyone else agree?

    Posted: 22 Aug 2020 04:35 AM PDT

    1. I started my first 401k back around age 26 making $9.50 an hour. I contributed about 3-5% to get the match.
    2. Got a job as a Phlebotomist and made around $12-$14 an hour from say age 28-33 and continued to contribute around 5%
    3. After about 7 years of this at age 33 my balance was maybe around $20,000 or so (kind of disappointing)
    4. Age 34 graduated college and got first real job as a medical technologist making $24.50 an hour and bumped 403b up to 10%
    5. Age 37 making about $27 an hour as Medical Technologist and bumped it up to 15% contribution limit.
    6. Age 39 making $29 an hour and 15% contribution I finally hit the $100,000 mark in my 403b account. It took me a good 12-13 years of saving.
    7. I am now age 41 and first year I moved to San Diego and am going to earn low six figures this year. I have bumped 403b up to max $19,000 per year.
    8. Age 41.5; My liquid assets are now at $267,000. (around $50,000 of that from selling real estate)

    I am shocked at how fast the ball gets rolling once you hit that first $100,000 balance in your 401k/403b. I took forever to reach that milestone but once i got there I probably made most of the second 100K in about 2 years compounding interest. I think it sets something off inside of you where you see that your money can make you more in one great stock market day then you earn at your 9-5 job in a 2 week pay period. That is when you really see the value of saving and investing and you normally try to max your contributions at this point no matter the discomfort in doing so. I could only imagine how fast wealth starts to snowball once you reach $1,000,000 and a good 2019 stock market year could add $250,000 to your portfolio. (more then most middle class workers earn in 5 years of work)

    My 2 questions for this post are did anyone else notice that once you hit $100K liquid assets it seems like its kind of the sweet spot where your wealth snowball really starts rolling.

    Secondly, why do so many people who focus so hard on earning money at their job, totally ignore saving and investing where undeniably once you reach a certain point your money will begin to go to work everyday, earning as much as a Physician, and start earning you a second six figure income passively.

    Its almost as if the number one secret to financial life is to get to 100K then 1,000,000 as quick as humanly possible and then coast the rest of your life one easy mode.

    Its true the rich get richer....But it takes a ton of discomfort and sacrifice to reach that point....The first 100K is the hardest.

    submitted by /u/MedicalLabScientist
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    Is day trading a legitimate way to earn money?

    Posted: 22 Aug 2020 09:26 PM PDT

    Is it a legitimate way to earn money? Being able to make an income from day trading sounds appealing, although 80% of traders lose money from this type of investing. Is there any merit to day-trading, or is it just a cash-grab for online influencers? I've dedicated a good percentage of my time trying to learn day trading, but have been discouraged along the way. I want to ensure that I'll be profitable, if I decide to pursue day trading. Should I just stick with passive or active investing or continue to learn about day trading?

    submitted by /u/lukemeola
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    Money Supply & Inevitable Inflation

    Posted: 22 Aug 2020 09:03 PM PDT

    We all know the Federal Reserve is creating huge amounts of currency, but I didn't quite realise the scale of it until I saw this chart.

    US Money Stock

    The increased currency creation after '08 barely even registers in comparison to what's been happening over the last 4 months. All that's required now for a significant surge in inflation is an increase in the velocity of money (rate at which it's exchanged). Because of the nature of the current situation, I think this could happen quite rapidly when either a) a vaccine is found or b) the virus fizzles out as is happening in many countries already.

    As we know, inflation is inversely correlated with stock prices. This would spell bad news for all the medium to long term bulls on this forum. It also makes the idea of holding gold and other precious metals even more attractive.

    submitted by /u/Grazed_and_confused
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    What are your thoughts on the Coinbase IPO - the Bitcoin exchange.

    Posted: 22 Aug 2020 05:43 PM PDT

    Coinbase is a Bitcoin exchange. They offer a few shitcoins too, with room to expand to more shitcoins. They make most of their money off trading fees. Recently they started offering custody services which i think will be more popular with instituational investors since it defers the "i got hacked" risk. They are rapidly growing in trading volume and are currently the largest exchange, in both bitcoin's held (approx 900,000 BTC) and in USD/BTC trading volume currently $80 million dollars daily.

    The IPO is upcoming and expected to valued at $8 billion . So what are your thoughts? Is this like investing in TD Ameritade in the early days of the stock market?

    2017 Revenues = $1 billion

    2019 Revenues = $2 billion

    Number of Employees 1,123

    submitted by /u/atrueretard
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    Is technical analysis a scam?

    Posted: 22 Aug 2020 07:25 AM PDT

    Is it? Many investors disapprove of technical analysis, while others have profited from using it. Should I invest my time learning about it, or should I learn fundamental analysis instead? Have gotten pretty discouraged from the negative comments regarding technical analysis, so far. I do find the concept pretty intriguing though, and have spent a good deal of time trying to enhance my understanding of it

    submitted by /u/Rham1040
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    Hotel industry stocks

    Posted: 22 Aug 2020 06:37 PM PDT

    The hotels and lodging REITS are down big. Do u think they can recover? Bill Ackman just sold all his PK shares but still holds Hilton. Pk is the hardest hit in the lodging sector. https://seekingalpha.com/article/4370203-park-hotels-resorts-undervalued-huge-risks

    submitted by /u/opaque_transparency
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    Valuations and P/E - The Bubble. Is it here?

    Posted: 22 Aug 2020 12:58 PM PDT

    I have a feeling most of you are extremely bullish. The question I have for you is, do you feel comfortable going all in on $TSLA which is now at 2050? How about $AAPL bear $500?

    Long-term no question these are good stocks to buy and hold. But, are they good stocks to buy...now?

    All the technicians are calling for a correction. Where do you see yourself?

    submitted by /u/theinternetishere12
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    A little advice for a beginner

    Posted: 22 Aug 2020 10:57 PM PDT

    Hello! I've been really interested in getting a side income or just a fun hobby, investing has always been an interest of mine. I don't have a lot of spare cash but i was thinking while I'm in the process of researching and studying different strategies and how to get into the field, would it be a good idea to buy a variety of penny stocks right now? Just some small stocks for me to play around and trade here and there to get a feel and comfortability with the process without risking losing any decent amount of money, does anyone have penny stocks they'd recommend?

    submitted by /u/J-POOL
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    how to contact a company for a board position?

    Posted: 23 Aug 2020 04:07 AM PDT

    I am going to make an assumption that board position has to do with % ownership you hold.

    lets say I buy 20% from a company from my computer on my robinhood account. I havent talked to anyone at the company about this, I just have a lot of money and decided to buy such a big chunk of the company.

    lets say I now want a position at the board.

    how do I make this happen because since I have own 20% of the company I should get one right? or is there voting involved when deciding new boardmemebers?

    and also, how would I go about this practically. do I send an email saying: you have a new majority owner and I want a position, give me a chair or do I send a letter or is this something thats automatically gets informed to the exisitng board members that then contacts me to welcome me?

    submitted by /u/creatorofpies
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    VIX as a hedge

    Posted: 23 Aug 2020 03:23 AM PDT

    So I think there is a decent chance we see some turbulence is the markets over the next few months and since I am extremely long I was looking for a hedge that would capture the election.

    I bought VIX 12/16 25c for 6.70. Thoughts on this strategy? What are you doing to hedge?

    submitted by /u/rpritz172000
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    ETFS

    Posted: 23 Aug 2020 03:00 AM PDT

    Hey all, I have a question and I hope I can word it correctly/appropriately. I know there isn't a right answer of how much % of ETFs should one hold in their portfolio. However, I always wondered about the # of ETFs for a single ETF. For example, I want to buy VOO, how many of VOO should I get? Is buying 1 is enough? Or should I buy for example 10 or whatever amount I can afford? When you buy stocks (let's say Apple), you try to buy an appropriate amount so you can get a proper dividend return. Is it the same with ETFs? I hope my question made sense.

    submitted by /u/Hallowedsoul88
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    Is it worth getting into investing as a complete newbie?

    Posted: 23 Aug 2020 02:14 AM PDT

    I am not sure if this is the right subreddit but here we go: I am trying to find a method of earning extra income over the next year or so. I tried to make a big change in my life and failed due to bad planning from my part. I intend to try again next year. I already have a normal job, but I want to add some extra oomph to my income.

    I am considering returning to my previous habits: surveys, microtasks etc, but they are really not time efficient. This is why I posted here: I want some other ideas on how to use my time for extra cash. I don't need to make a fortune, I don't even need that gig to make a three-digit profit over the next year. I just want something that won't eat a ton of my time and that will pay out, guaranteed. I understand that investing requires gigantic amounts of research and I have very little money to work with, so I am not sure if this a good scheme in the first place. I am just looking for ideas man.

    submitted by /u/ReallyHappyMeal
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    Digital Realty Trust (DLR)

    Posted: 22 Aug 2020 05:09 PM PDT

    Demand for cloud computing increases the need for data centers and I think this company is well positioned to capitalized on this long term trend. I've been doing some due diligence on this industry and read a lot about Digital Realty Trust. Very impressive customer list and recent partnership with Nvidia definitely tells me this company is doing something right. What are your guys thoughts on this stock as a long term investment?

    submitted by /u/MaxandmillionB89
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    Example strategies of how you invested in a conspiracy theory?

    Posted: 23 Aug 2020 01:40 AM PDT

    Example: I suspect that the USA and China are at war with Portland and Hong Kong as the result of social network's data and AI getting a better control of cultural subterfuge.

    My question: In this example, how would I convert this theory into an actionable investing plan? I mean, isn't Facebook a waning power now?

    If you have a worked example from an older time, like the 70's, where we have the benefit of hindsight then please share. And something a bit more complex than

    gold, buy physical, short contractual, ideally.

    https://www.reddit.com/r/investing/comments/9epzyn/whats_your_favorite_investing_conspiracy_theory/

    https://www.bloomberg.com/opinion/articles/2018-04-13/an-investing-guide-for-conspiracy-theorists

    https://www.share.com/stock-markets-and-news/opinion-and-analysis/2020/july/dont-fall-for-the-conspiracy-theories-they-could-seriously-damage-your-portfolio

    submitted by /u/After-Cell
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    DSTL ETF

    Posted: 23 Aug 2020 12:13 AM PDT

    What intrigues me is their approach to finding value, considering all of the "is value investing dead" posts etc. A common response is that common "value" screening criteria confuses declining businesses for value plays, instead finding value traps. I am not saying it is an exhaustive list of deep value plays and I am also not saying it is some novel idea that will crush SPY over the next 30 years. I'm just saying it possibly weeds out less desirable companies more effectively than other similar ETF's.

    One other aspect that I like is it isn't as heavily weighted towards FAANG as other SP500 index funds. I am interested in reducing volatility but maximizing returns, as most are, and the concentration and valuations of FAANG bothers me. I have considered equal weight ETF's going forward but this one might offer decreased volatility without sacrificing returns. Overall, probably not going to change my course but curious as to what other more knowledgable folks think.

    DSTL

    Principal Investment Strategy The Fund uses a "passive management" (or indexing) approach to track the performance, before fees and expenses, of the Index. The Index was developed in 2018 by Distillate Capital Partners LLC, the Fund's investment adviser and index provider (the "Adviser"), and uses an objective, rules-based methodology to measure the performance of U.S.-listed, large-capitalization equity securities, selected based on certain fundamental factors, as described below. Distillate U.S. Fundamental Stability & Value Index Construction of the Index begins with the constituents of the Solactive US Large Cap Index, consisting of approximately 500 of the largest U.S.-listed companies, screened to remove companies that have less than five years of cash flow per share data available (the "Equity Universe"). The remaining companies are then evaluated based on the following three proprietary fundamental measures to identify the companies that will be included in the Index: Financial Indebtedness Companies with significant leverage (based on a proprietary debt-to- income calculation) are excluded from the Index. Fundamental Stability Each company is scored based on a proprietary measure of the volatility of its historical and projected cash flows as an indicator of fundamental stability. The bottom 50% (i.e., the least stable) of the companies in the Equity Universe based on this measure are excluded from the Index. Valuation Each company is scored based on a proprietary measure of the company's free cash flow yield (a measure comparing a company's normalized free cash flow to its enterprise value). The top 100 companies (the most undervalued) that meet the Index's other criteria are included in the Index.

    https://distillatefunds.com/dstl

    submitted by /u/holladimsum
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    Secular growth sectors/industries: individual stocks vs etfs

    Posted: 22 Aug 2020 12:38 PM PDT

    I know this is a somewhat common topic but had a more specific question that I haven't seen discussed and wanted to get some thoughts. For a little background, I like to diversify my portfolio between individual stocks, etf's and mutual funds with a bit of a tilt towards index mutual funds. I'm all for buying "best of breed" stocks for long term holds in more established, cyclical or defensive sectors (I.e. banks, discount retailers, industrials or the likes of Microsoft/Amazon/Apple, etc.) but I was curious if anyone had thoughts on more secular growth sectors/industries like cloud software, cybersecurity, e-commerce, healthcare or semiconductors.

    Candidly, I'm not sure I have the prowess to identify the winners or losers from these groups although I generally think they will continue to grow as a whole. Alternatively, buying the largest or best-run companies out of these may also be a winning strategy but there is risk of missing the fastest growers/disrupters. You may disagree with my categorization of secular growth sectors but I'm really looking for more general and high-level input on individual stocks vs etfs.

    Any thoughts?

    submitted by /u/Donnie_Trunders
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    A few questions from a complete beginner interested in investing.

    Posted: 22 Aug 2020 11:12 PM PDT

    I am 21yo, m, just landed my dream job. I earn anywhere from 300-500 euros a week, but this is because of COVID. I recently realized I was wasting my money and I don't want to splurge all my money, especially since the COVID situation will likely end soon, and my income will go down significantly after that. So, I decided to get into investing.

    In the past 3 weeks, I have been reading a lot, followed a few YouTubers, TikTokers and bloggers on investing, and I feel like I want to start investing some small amount of money to get a feel for it. However, I was not able to find answers to the following questions, and I hate being unprepared.

    1. Can I use investment apps like Robinhood outside the USA? (I am in EU.) Will I have problems receiving dividend or cashing in what I sold if I use such apps?
    2. How do I calculate what % of my earning do I need to pay to the government? (Is it based on what I buy or what I sell? Can they even check where my money is going if I trade exclusively online?)
    3. If a stock splits from let's say 100 to 110, and I own 1 stock. Did my stock effectively lose 10% of its value? Do I at least get compensated? Does the company inform stock owners of the split?
    4. How does stock market work in regards to timezones? And why does the stock market close in the first place?
    5. What do the apps that have no fees for buying/selling get from me?
    6. If I own a significant % of stocks in a single company, do I get the right to influence its financial decisions, or is that just a TV/movie thing?
    7. I have read a lot about how diversifying investments is the best action to prevent loss and grow in the long run. But how do you even diversify? Do I go all-in on let's say technology, and invest in different areas of technology like computers, phones, appliances? Or do I invest in much broader fields like technology, food, entertainment, etc?

    Thanks in advance for all of your answers. :)

    submitted by /u/Mildly_Evil_Duck
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    Tools for fundamental and portfolio analysis - stock rover

    Posted: 22 Aug 2020 10:28 PM PDT

    First things first.. I'm a long term investor and pick my own securities. If you're response to this post is "Buy ETFs," this isn't for you.

    Back to it..

    I'd like a place to conduct fundamental analysis and store these analysis on various securities with data that updates regularly (I.e. not excel). While my brokers E*TRADE, IKBR, TDameritrade, and Schwab all offer the needed financial data (IKBR probably the best of the bunch), it's not so easy to stay organized.

    Picking the right securities and staying on top of their quarterly earnings as well as analyzing my portfolio (balancing, etc.) is critical for any DIY investor.

    I found stock rover and it looks promising. What are the pros using? Better yet, what are you using to analyze investments and stay on top of your portfolio?

    Cheers

    submitted by /u/RetardStrength-
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    Can someone ELI5 what $ACATX is and why it's up 50% YTD?

    Posted: 22 Aug 2020 08:32 AM PDT

    I came across this fund last night following some reading and I don't understand this fund. From what I understand, it routinely rotates sectors of stock and then if it signals a crash or correction it buys treasury bonds? Is that right?

    Even the long term gains beat the S&P with only the 10-year term being slightly less.

    Yes, it's expensive with an expense ratio of over 1%, but if your returns are 50%+ or even half of that, who cares?

    Why wouldn't more people invest in something like this? I know a 3 fund indexed portfolio is the way. I have one of those. But I kind of feel like with returns that high, it's worth throwing some extra money at it.

    EDIT: I meant $ATACX

    submitted by /u/CKyle22
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    ELI5: Why are Bonds yielding so low right now? And if they continue to yield lower for several years to come - what will happen to the value of bond ETFs that hold a lot of short term bonds?

    Posted: 22 Aug 2020 11:30 PM PDT

    I saw this graph on Reddit: https://i.redd.it/meipk3h8led51.jpg showing how more than 60% of the global bond market now yields less than 1%. If you look at the history of that graph it does not look good for the future of bonds. But I'm likely missing something here.

    Could someone who understands this thoroughly ELI5?

    submitted by /u/investorio
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    Dumping $50-$100K at a single stock.

    Posted: 22 Aug 2020 08:08 AM PDT

    Hey all,

    Looking to get outside perspective on dropping $50-$100K on a single stock.

    Some context: - 30 years old, been investing seriously since 2017 - Current portfolio size: $250K - Portfolio consists of mainly standard stocks: S&P etfs, QQQ, FANGM, AMD, SHOP, LULU, NIKE, Banks, Credit cards, ATZ, some airlines, and a few others. I'd say I have around 22 stocks. - Income: very fortunate to be in the $250-$300K range

    Up until now, I've been fairly safe with my investments and haven't made any big bets on any singular stocks, largest position would be about $7-8K (not including ETFs). My returns have been modest, 60% in the past 2.5-3 years. However, when I look at my top performing stocks, which were the ones I had the most confidence in buying, I didn't make a big purchase and some are +100% all the way up to +700%. Turning 1-2K into 5-10K is nice, but I'm feeling like I want to try and accelerate my net worth faster.

    The TLDR is that I'm able to save/invest between $60-80K / yr and at this point in my life, if I were to take a $100K position in a single stock that dropped by say, 80%, my life would largely be unaffected (other than slowing my eventual retirement down a bit). I like the small wins I've gotten, but if I want to "become wealthy" at a relatively young age, 35-40, I don't see my current path getting me there.

    So, what are everyone's thoughts on me taking a more sizeable position in a company I believe in. This stock would not be something overly risky (no small cap), maybe a FANGM stock, no memes like TSLA. A company with a proven successful track record for years.

    All comments appreciated!

    submitted by /u/marc44
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    What's your view of the "Buffett Indicator?"

    Posted: 22 Aug 2020 06:24 AM PDT

    What's your view of the "Buffett Indicator?" My view is that there isn't much information content in this because the market capitalization has units of $, but the GDP has units of $/TIME.

    These two numbers only have 1 thing in common and that is that they're both on the same order of magnitude in size - about 1013. It seems somewhat random that this "Buffett Indicator" is given this much interest. I've never heard about it prior to a week ago, but back in '03, I remember the metric of Market Capitalization of the S&P 500 divided by the GDP was used, and according to that, the markets were still over 1.00 .

    Anyways, is this whole "Buffett Indicator" a click-bait gimmick by yahoo.com , or is there some utility associated with this? If there is utility in this metric, how can I use it to my advantage?

    submitted by /u/oblique_strategies_
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    Semiconductors?

    Posted: 22 Aug 2020 06:04 AM PDT

    So I'm a total noob in the area of semiconductors. All I know is that their basically essential for computers & tech hence should be an important area for investment. Someone explain to me the different semiconductor products & their applications. Which companies should I invest in & why? Are they currently overvalued like the rest of tech?

    submitted by /u/SMSA1989
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    Buying dividend stocks as bond portion of portfolio

    Posted: 22 Aug 2020 05:58 PM PDT

    Just as the title says. What are your thoughts on buying companies with good dividends but still depressed prices instead of bonds until rates return?

    Companies like RTX and INTC have a decent dividend and in a tax-sheltered account with drip could have a greater return than a corporate bond from a company of the same caliber.

    submitted by /u/Lawnthrow22
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