Daily General Discussion and spitballin thread - November 04, 2021 Investing |
- Daily General Discussion and spitballin thread - November 04, 2021
- Daily Advice Thread - All basic help or advice questions must be posted here. November 04, 2021
- Fed to start tapering bond purchases later this month as it starts pulling back on pandemic aid
- Should you invest in IPOs?
- Is there any reason not to use leverage/LEAPS for long term investing?
- Robinhood expands offering that allows retail investors to buy into IPOs
- Optimising portfolio across asset classes/asset classes
- Will current trends result in companies exploring automation?
- Want an 11% Yield? Give Oil a Try
| Daily General Discussion and spitballin thread - November 04, 2021 Posted: 04 Nov 2021 02:02 AM PDT 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 04, 2021 Posted: 04 Nov 2021 02:01 AM PDT 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]  |
| Fed to start tapering bond purchases later this month as it starts pulling back on pandemic aid Posted: 03 Nov 2021 11:42 AM PDT Fed to start tapering bond purchases later this month as it starts pulling back on pandemic aid Fed to start tapering bond purchases later this month as it starts pulling back on pandemic aid So anyone think we're going to see heightened sensitivity on the 10 year T-Bonds till the point it finally spikes above 2%? Seems they're still keeping interest rates at zero so we can expect inflation to keep busting up but will the bonds finally reflect the markets skepticism on inflation? Either way the WSJ reported that the FED will be out of providing stimulus by JUNE 2022 Also the Fed maintained the term "transitory" while adding the term "temporary" when describing inflationary pressures … though they're keeping the interest rates at zero 🧐 Keep an eye on the 10 Year Treasury Yeild later this month. The higher the inflation the lower the demand, the lower the demand, the higher the yield. [link] [comments]  |
| Posted: 03 Nov 2021 04:53 PM PDT Hey guys, if you have ever considered investing in IPOs, or companies that have gone IPO in the recent years, then this post is for you. I did a bit of a quick research into this recently. But first, a quick recap of what Warren Buffet says about investing in IPOs:
I'd like to share with you some stats that I put together. Bear in mind the following:
Results:
I also came across an academic study on Initial Public Offerings by Jay Ritter, a finance professor at the Warrington College of Business in the University of Florida. One piece of information that caught my attention in his paper is Figure number 2, labeled Percentage of IPOs with negative EPS. If you check the figure, you'll notice how in recent years over 75% percent of the companies that have gone public have had negative earnings. When you buy shares of companies, you get a piece of the ownership and therefore a piece of the earnings . Well, with IPOs in the recent years, in 75% of the cases there is no earnings for your shares. You are literally investing with the expectation that the company will become profitable, which by the way is already factored into the price that you are paying. So if these new public companies fail to turn a profit, or perhaps if their path to profitability takes longer, the stock price will suffer. Your only chance is the company continuously beating expectations. Not to mention that you don't even have enough years of financial reports to build a solid foundation for analysis. Hope this helps. I don't want to discourage anyone though, a lot of people have made good money on IPOs, but base on the data it's pretty obvious that the average investor should stay away from them. [link] [comments]  |
| Is there any reason not to use leverage/LEAPS for long term investing? Posted: 03 Nov 2021 11:42 AM PDT If you are holding long term, why would I not use leverage on some of the most stable and reliable assets that exist? There has never been a time in history where the S&P500 and the NASDAQ haven't made up for losses after a market crash. I imagine that if I buy LEAPS after a market crash on leveraged etfs like TQQQ and UPRO, I could stomach the 50-60% losses i would likely take during a crash and rebound with even more force. I imagine my portfolio might look something like this: -35% TQQQ -35% UPRO -25% High dividend stocks like T, KHC, and KO to fund dip buying and LEAPS calls -5% precious metals/crypto Once i contribute a enough money into dividend stocks, the account would become self-funding, and I could make 60% a year on assets that reliably return 20% instead of trying to beat the market by betting on biotech and tech startups. I know alot of people are going to talk about risk tolerance and hedging, but would there really be any losses in the long run?I mean, you will inevitably watch your account blow up if the market crashes, but it would rebound even harder, especially if you buy calls on an already leveraged assets. What do you think? [link] [comments]  |
| Robinhood expands offering that allows retail investors to buy into IPOs Posted: 03 Nov 2021 02:19 PM PDT Online brokerage Robinhood Markets Inc said on Wednesday it would allow companies issuing shares through its IPO Access platform to set aside some stock for members of the public with ties to the issuers. Directed Share Programs (DSPs), which Robinhood refers to as its "friends and family" offering, allows employees, customers, vendors, or others who have a relationship with the issuing company an opportunity to buy shares at the IPO price. As part of the DSP program, the company reserves a portion of IPO shares for a specific group of people and Robinhood helps distribute these shares to those select individuals. In May, the popular online brokerage unveiled the IPO Access offering, which gives retail investors the opportunity to buy shares in IPOs. Large institutional investors and funds have traditionally been the first in line for allocations on IPOs, as the investment banks that control share allocations typically prioritize deep-pocketed Wall Street clients. That typically leaves most retail investors with no option but to buy into stock of a newly listed company only after its shares start trading - which often means paying a higher price. Through its new platform, Robinhood works with Wall Street investment banks to get allocations for retail investors. Robinhood has partnered with 12 companies that have made their IPOs available to its customers, as of October 31. Its latest offering will make IPO shares accessible to an even bigger pool of retail investors. [link] [comments]  |
| Optimising portfolio across asset classes/asset classes Posted: 03 Nov 2021 09:48 AM PDT Hi everyone, I have a few different brokerage accounts and currently just manage my holdings on a spreadsheet to stay on top of it. I also was looking to potentially go cross-asset class and add a small amount of crypto to the mix. I tend to use just basic portfolio theory to optimise my holdings and their sizes. Has anyone used a tool or product that lets you do this in one place? Or at least add crypto to your exposure while optimising the holding relative to my stocks etc? Thank you! [link] [comments]  |
| Will current trends result in companies exploring automation? Posted: 03 Nov 2021 06:40 AM PDT So amid the ongoing worker shortage, what seems to be the beginning of more widespread strikes, and an increase in the cost of labor, it seems inevitable to me that companies will explore automating their processes. This was a trend I anticipated even before COVID as technology advanced and higher wages seemed inevitable, in combination with the fact that American labor is already much more expensive than in other countries. Do you anticipate companies will respond in this way? And if they do, are the cost, complexity of tasks, and current state of the technology such that companies actually can switch to automating tasks? [link] [comments]  |
| Want an 11% Yield? Give Oil a Try Posted: 03 Nov 2021 05:52 AM PDT By Alex Longley +Follow October 21, 2021, 12:04 PM UTC
Time will tell which one is out of sync. Is it a forward oil curve that yields 11% on an annualized basis for investors, or is it a headline price of West Texas Intermediate crude near $83 a barrel? Because if there's one thing over which there's growing consensus in the oil market, it's that the forward curve is more reflective of $100-a-barrel oil than the current price. The spread between the nearest two December contracts hit a premium of $10 a barrel this week. The only other time this century it has been so strong was in 2013. When more immediate prices are pricier than later ones, it is called backwardation and is normally viewed as a bullish indicator. "Crude backwardation remains relentless," said Keshav Lohiya, founder of Oilytics, noting that the last time spreads were this strong WTI was above $100. "Either structure is too pricey or flat price is undervalued, our guess is the latter." The strengthening curve comes at a time when increasing numbers of analysts, traders and investors are once again talking of the prospects of oil prices returning to $100 a barrel. That possibility is being supported by an energy crisis that's boosting demand for petroleum to be used for power generation, and steadily decreasing stockpiles worldwide. In the case of WTI, though, the strength has been compounded this week by a sharp drop in inventories at the U.S. storage hub of Cushing, Oklahoma, where oil futures are priced. The market could be just weeks away from Cushing effectively running out of crude, JPMorgan Chase & Co. analysts including Natasha Kaneva said in a report. If nothing changes at the storage hub, WTI front spreads may spike to record levels and into a "super-backwardation scenario," they said. Wagers on market structure show up in traders' positioning figures too. In WTI, one group of speculative investors is holding the largest position in spreads since 2008, according to Commodity Futures Trading Commission data. It seems to me that WTI oil futures curve is still in severe backwardation after the publication of the article suggesting that oil could move even higher [link] [comments]  |
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