Daily General Discussion and spitballin thread - November 21, 2021 Investing |
- Daily General Discussion and spitballin thread - November 21, 2021
- Daily Advice Thread - All basic help or advice questions must be posted here. November 21, 2021
- Is the inflation trend in the US really that scary?
- El Salvador to Create ‘Bitcoin City,’ Use $500M of Planned $1B Bond Offering to Buy More Bitcoin
- A contrarian perspective on index funds.
- how ETFs work behind the scenes, rebalancing and preventing capital gains
- Do I have too many ETFs, over diversified?
- What happened to people's brokerage accounts when the country switched to Euro?
- Move house, reinvest profit?
- Thoughts on PIMIX and other actively managed bond funds?
- My ONLY issue with DCA (Crypto related post)
- Am I missing something with $GTIM?
| Daily General Discussion and spitballin thread - November 21, 2021 Posted: 21 Nov 2021 02:02 AM PST Have a general question? Want to offer some commentary on markets? Maybe you would just like to throw out a neat fact that doesn't warrant a self post? Feel free to post here! This thread is for:
Keep in mind that this subreddit, and this thread, is not an appropriate venue for questions that should be directed towards your broker's customer support or google. If you would like to ask a question about your personal situation or if you are asking for advice please keep these posts in the daily advice thread as that thread is more well suited for those questions. Any posts that should be comments in this thread will likely be removed. [link] [comments] |
| Daily Advice Thread - All basic help or advice questions must be posted here. November 21, 2021 Posted: 21 Nov 2021 02:01 AM PST If your question is "I have $10,000, what do I do?" or other "advice for my personal situation" questions, you should include relevant information, such as the following:
Please consider consulting our FAQ first - https://www.reddit.com/r/investing/wiki/faq And our side bar also has useful resources. 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] |
| Is the inflation trend in the US really that scary? Posted: 20 Nov 2021 05:05 PM PST The October inflation in the US was 6.2% on an annual basis, which is super high given the recent history of sub-3% rates. That said, I come from a place where people were high-fiving when they get anywhere 6% inflation. Double digits were the norm back there. When I was a kid we lived under hyperinflation which is a complete shit show, people get their paychecks and immediately go buy their groceries for the month. This is not a figure of speech, they really did go IMMEDIATLY because the prices were readjusted 1 or 2 times IN THE SAME DAY. Concept of savings was non-existent. Either you buy as much US Dollars as possible or put in some asset that has intrinsic value like real estate. The house I grew up was huge, and I learned that was not because my father was in a good financial situation, but rather it was the only option to dump all his savings before it lose half of its value in matter of weeks. Long story short, my bar is a bit out of place here... so should I be concerned with the 6.2% rate? My take on this: likely FED will increase rates, which will devalue bonds and stock prices. But then this should be already embedded in the current asset prices, so I don't think I should be doing anything with my portfolio here. [link] [comments] |
| El Salvador to Create ‘Bitcoin City,’ Use $500M of Planned $1B Bond Offering to Buy More Bitcoin Posted: 20 Nov 2021 10:41 PM PST El Salvador, the only country in which bitcoin is a legal tender, is going to build an entire city based on the largest cryptocurrency, President Nayib Bukele said in a Saturday night presentation at Bitcoin Week in El Salvador. "Bitcoin City" will be located along the Gulf of Fonseca near a volcano. The government plans on locating a power plant by the volcano to provide energy for both the city and bitcoin mining, the president said. According to Bukele, Bitcoin City will be a full-fledged metropolis with residential and commercial areas, restaurants, an airport as well as a port and rail service. The city will be laid out in a circle (like a coin) and in the city center will be a plaza that will be host to a huge bitcoin symbol. The city will have no income, property, capital gains or payroll taxes. Bukele also said El Salvador plans on issuing $1 billion US "bitcoin bond," a tokenized financial instrument developed by Blockstream, on the Liquid Network. Of that amount, $500 million will be used to help construct needed energy and bitcoin mining infrastructure and $500 million to buy even more bitcoin. At the cryptocurrency's recent trading price of about $59,000, that would bring the country's treasury stash to just under 2,000 bitcoins. [link] [comments] |
| A contrarian perspective on index funds. Posted: 20 Nov 2021 05:18 PM PST I always love hearing contrarian perspectives. This guy has a perspective that investing in SPY, IVV, VOO And Other S&P 500 ETFs may not be as wise or diversified as standard investment advice would make it seem. His perspective is that a large percentage of investors just buy SPY or similar ETFs. Such a sizable amount that the diversity argument for them is effected. Diversity only works well if there's enough buyers and sellers of the individual stocks that make up the index. But if mostly everyone is buying the index, diversity doesn't matter: as instead of the index "tracking" these stocks the index is influencing their price instead; thus you start to have similar liquidity issues as you would it you only bought stock in one or two companies. In other words, the more people invest in index funds, the less effective the diversity of the index fund is, and the more liquidity risk you are exposed to. Basically it's better to handle diversification more actively rather than rely on indexes. Article was written in 2017, so he may not have foreseen the liquidity injections of 2020 and 2021. I'm not quite sold on his thesis. What do you all think? [link] [comments] |
| how ETFs work behind the scenes, rebalancing and preventing capital gains Posted: 20 Nov 2021 07:21 AM PST Imagine VOO. Folks (like me) buy and sell the VOO ETF and behind the scenes Vanguard takes the steps to periodically rebalance the index. It's my understanding that this rebalancing happens on dates known in advance. As owners of the ETF, we hope not to see capital gains triggered by these rebalancing events because that means taxes. My question is, how this rebalancing happens and is there some aspect around the ETF construct which allows vanguard to (say) sell a stock at a profit (as part of the rebalancing) yet somehow not pass that capital gain back to folks holding the ETF? Or is vanguard leveraging tax loss harvesting as a means to counter capital gains and thus not pass gains to folks holding VOO? If vanguard is leveraging tax loss harvesting to counter gains in order to prevent capital gains from being passed on to VOO holders, can vanguard shuffle, behind the scenes, those tax losses between different ETFs or must those losses remain associated with the stocks tied to VOO? Just trying to understand the details here... [link] [comments] |
| Do I have too many ETFs, over diversified? Posted: 20 Nov 2021 08:44 PM PST (Posted in r/stocks recommended posting here) Do I have too many ETFs? I've been investing in ETFs in different sectors but am aware, through looking at holdings, some of them overlap, is the overlap that significant or are these ETFs different enough for their own sectors? Or is having this many holdings just ineffective with a monthly investment of 300-400 dollars a month? I'm open to all info, thanks all. Bless. STOCKS: TTCF ETFs/Index: ICLN, CARZ, XLF, IXJ, XLP, VOO, NOBL, SCHH, ARKX. NOTE: I have many ETFs but each month I don't always invest in all of them, I usually only invest big in the ones that are down the most, with the rest of the money being distributed to the rest of the portfolio. [link] [comments] |
| What happened to people's brokerage accounts when the country switched to Euro? Posted: 21 Nov 2021 01:06 AM PST I tried to google a simple quick answer to this, but couldn't seem to find the results I was looking for. Let's say you had a brokerage account and you had a few long-term stock investments and you also did stuff like selling options here and there for income. And it's all in X currency. Then they switch to Euro. What would have happened to any free cash in your brokerage account and any stock holdings you had? Was it just like...automatically switched over? I'm just trying to wrap my head around what happens during a currency reset or any shift in currency. [link] [comments] |
| Posted: 20 Nov 2021 07:48 PM PST Looking to move to a new house, significant upgrade to our existing home, also solves several personal issues:
We can afford the mortgage on the home through our overall annual income, that's no problem. We currently have advisor-managed accounts with Vanguard. I'm thinking we do the following: $350,000 from the house whale. -$50,000 for home upgrades -$50,000 savings replenish That leaves $250,000 left to push into our Vanguard account. This is an account with a 95/5 stock/bond blend (VTI/VXUS). Originally we were just going to pay down principal with the house payoff, but recent major promotion at work has allowed that not to be required. This seems like a no-brainer move, but what am I missing here? Is there a reason I would not want to do move this money into investments? [link] [comments] |
| Thoughts on PIMIX and other actively managed bond funds? Posted: 20 Nov 2021 07:40 PM PST When it comes to equities I have a pretty solid grasp on how the markets work, how options are priced, etc. However, when it comes to the bond markets I don't know them very well. Taking a peek at PIMIX it seems like it has performed very well, but is this really just because of the bond bull market (falling rates)? It would seem a bit crazy to expect continued 7-8% yearly returns. SEC yield is currently not even 2.5%. I would be holding this partly as a bond allocation in a quarterly rebalanced tax-advantaged account ( most likely ) but also as a cash alternative. The other downside I can see right up front seems to be the $25k minimum, which makes it not possible to use in a small IRA or 401k as a bond allocation of say 20%, since you'd need $100k+ in that account before that would be a 20% allocation. [link] [comments] |
| My ONLY issue with DCA (Crypto related post) Posted: 21 Nov 2021 04:21 AM PST I am certain I can not be the only person in the crypto space that faces this dilemma every time they have some disposable cash to DCA into held projects. I would like to know what strategies you use. I am a very average investor with give or take about $600 to use on both new projects I like and DCA into promising ones I hold. The trouble is, there are so many amazing projects out there that it is a struggle to shrug a lot of them off, so I keep adding new tokens to my portfolio, which then makes the choice of what to DCA into incredibly hard, because I start to believe I am spreading the love way to thin on the projects I hold due to my limited funds. I then find myself getting tempted to get out of projects just so I can DCA more ''meaningful'' amounts into others every month. I am in some blue chip projects like ETH and DOT, but it almost feels silly (I know it's not really but it's just so small it feels negligible to me) putting $60 in ETH monthly because I have 9 other projects to add to. Is it best to reduce the number of projects I am in so I can allocate more cash to each one, or keep them all and keep topping up with these tiny amounts I can afford every month? [link] [comments] |
| Am I missing something with $GTIM? Posted: 20 Nov 2021 06:28 PM PST I want to preface this by saying that I understand that stocks like these (60 millions dollar market cap, extremely low volume) are not this subs cup of tea. They are not mine either, but I came across this stock just kind of goofing around and now I'm seriously considering buying it. I trust this sub more than any other community on the internet when it comes to good DD and analysis, so please forgive me for posting about a relatively unknown company. I was screening for stocks in the restaurant sector that met my criteria for the industry (low PE, good margins, growing revenue and EPS, etc) when I came across GTIM, a company I'd never heard of before. The first thing that caught my eye was the extremely low PE at less than 4. I assumed that the companies growth must be non existent and/or they had a terrible debt/cash ratio. I was completely wrong. GTIM's revenue grew 40% this quarter to 34,000,000 dollars. Their net income grew 4500 percent (no, that's not a typo) this quarter to 13.6 million dollars. They have 10,000,000 in cash on hand and paid off all of their debt. The companies restaurants have great reviews at all 35 locations (based in Colorado and Wyoming) and are diversified in the types of restaurants they operate (some sit down, some drive thru). On the most recent earnings call (AUG 10th) the CEO said they plan on opening one new location in 2022 and only using cash to finance this restaurant as well as any restaurants GTIM opens in the future. I'm not sure how I feel about this, but it certainly provides a margin of safety that most low market cap stocks don't have to offer. I usually stick to value or GARP investing but I feel like this might be too great of a buy to ignore. The only negative I could find was the extremely low average volume (30,000). Can someone tell me if I'm missing something here? I'm planning on researching the company further and potentially investing, but wanted to make sure I didn't miss anything before I dove in deeper. [link] [comments] |
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