Daily General Discussion and Advice Thread - December 20, 2021 Investing |
- Daily General Discussion and Advice Thread - December 20, 2021
- does anyone else find themselves addicted to investing?
- Only 4% of US stocks from 1926-2016 outperformed one-month T-Bills!!!
- Investing in a restaurant, shares will decrease over time. Normal?
- Are Option trading and Future trading functionally similar?
- Should I exercise my stock options?
- Can TikTok Impact the Bottom Lines for Meta (Facebook) and Google (Youtube)? Is Tiktok an Existential threat for Meta? [I don't think So]
- Is there any accessible academic research on yield curve false positives?
- CFRA's Fair Market Value for EBAY?
- Is there a library where we can see all the back testing done?
- Different types of DCF Models?
- Daily General Discussion and Advice Thread - December 19, 2021
- You’re over exposed to Real Estate
- Is Tax loss harvesting needed if I am not selling at all
- How do yall feel about financial youtubers such as Mark Tilbury/Graham?
- Based on breaking news, the day to day price movement of the total stock market is somewhat easy to predict
- Turkish Lira investing. Too soon?
- $27.11 Spread on $SPY. Did the shorts cover post Quadruple Witching?!
- Investopedia's Cost of Debt formula is wrong
| Daily General Discussion and Advice Thread - December 20, 2021 Posted: 20 Dec 2021 02:01 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! 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] |
| does anyone else find themselves addicted to investing? Posted: 19 Dec 2021 10:33 PM PST I mean, it's just such a satisfying feeling buying more and more things. I'm a long term holder so any time I have spare money I just stick it into one of my investments. I honestly at times feel like it's an urge almost, like that feeling of longing you get when you want to eat junk food or something. even when I don't buy anything, I find myself spending my free time looking up anything about investing and reading about it. Like, gosh, it's just so satisfying @_@ i just wanna buy all the shares of VTI that i can and other stocks or etfs I like. I mean, I guess it's better than being addicted to cigarettes and alcohol and spending those dollars on cigarettes and alcohol right? I suppose maybe being addicted to investing may be like being addicted to working out. so I mean there could be worse things than that I guess? [link] [comments] |
| Only 4% of US stocks from 1926-2016 outperformed one-month T-Bills!!! Posted: 19 Dec 2021 12:21 PM PST There is an academic paper written by Hendrik Bessembinder that analyzes the returns of individual U.S stocks from 1926-2016. It can be accessed here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447 In the paper he concludes that from 1926-2016:
Most notable statement from the paper: "just five firms (Exxon Mobile, Apple, Microsoft, General Electric, and International Business Machines) account for 10% of the total wealth creation. The 90 top- performing companies, slightly more than one-third of 1% of the companies that have listed common stock, collectively account for over half of the wealth creation. The 1,092 top- performing companies, slightly more than 4% of the total, account for all of the net wealth creation (returns in excess of one-month t-bills). That is, the remaining 96% of companies whose common stock has appeared in the CRSP data collectively generate lifetime dollar gains that matched gains on one-month Treasury bills." [link] [comments] |
| Investing in a restaurant, shares will decrease over time. Normal? Posted: 19 Dec 2021 04:47 PM PST Hi, as stated in the title, I'm investing in the opening of a restaurant (5%). the contract says that I will own 5% until my principal is earned back, then down to 2.7% for the next 2 years, then 1.6% afterwards. The reason I was told is that those shares will be distributed to employees and members of the management once the business is stable. I've very little experience in the field, so I would like to ask if this is a common practice? Thanks in advance for your answers! Edit: it seems my wording is confusing. The 5% is my share of the company and that won't change. What is getting lowered is my interest rate in the first restaurant. (Unsure it's the right term, it's what percentage of profit of the first restaurant will be split to me). [link] [comments] |
| Are Option trading and Future trading functionally similar? Posted: 19 Dec 2021 08:11 AM PST Obviously options are derivatives of stocks and futures are derivatives of natural resources, but in terms of how they're traded, the risks involved, and how they're prices its more or less the same right? As in, the leverage is similar, you're betting on what the price will be at a date, you can only lose 100% of your option/future contract, not go negative, etc? If not how are they different? If you can lose more than 100% of your contract price on a future, how can that happen? [link] [comments] |
| Should I exercise my stock options? Posted: 19 Dec 2021 05:51 PM PST Hello! I've recently vested the first chunk of options at the start up I work at. This is my first time working at a startup and want to get some opinions on if I should buy now or wait until later. I have the option to pay $4.5k now and the chunk is worth around $8k at current market value, as valued by the VCs or finance team or whoever. The horizon on our startup is years out before IPO/we get bought I believe. We're not close to a liquidity event. I do believe we're on track to be successful. I don't think this company is going to fold anytime soon Should I pay now? Do I owe taxes in my gain now? Are there capital gains taxes I need to worried about? Is it better for me to put that 4.5k into VTI and then buy my options when we're close to a liquidity event? Thanks! [link] [comments] |
| Posted: 19 Dec 2021 12:27 AM PST Maybe I do not know Tiktok well enough, but it doesn't have a hook like facebook does to get people to come back. Even though people do not use facebook.com as much, people are still using messenger for messaging their friends or whatsapp or Instagram. Tiktok is more similar to youtube in this regard in that from my understanding it is not being used as a way for connecting with friends and planning social events, eg "dinner @ 8, who's in?" I think it can semi-permanently steal market share from Google, but since their is no hook to get people to come back (like messenger for Facebook), a superior product can come and beat it. So While I do believe Tiktok can steal significant market share in the short run from Facebook, Google, in the long run unless they make DM easier, or embed themselves (which they trying to do very hard) in society, I don't think its a long term threat... What are your thoughts? Edit: Thanks for all your responses. Having never used TikTok I never realized how addicting it was. [link] [comments] |
| Is there any accessible academic research on yield curve false positives? Posted: 20 Dec 2021 04:11 AM PST A yield curve inversion seems to be a pretty good indicator of a recession and stock market crash but there have been a few false positives throughout history. I'm wondering if someone has done an accessible analysis on the differences between those false positives and inversions that were the real deal. Additionally, I often see talk of a "sustained yield curve inversion" but there doesn't seem to be a standard definition of how long an inversion has to be for it to be sustained. Thanks! [link] [comments] |
| CFRA's Fair Market Value for EBAY? Posted: 19 Dec 2021 09:19 AM PST Hi. I like screening oversold S&P 500 stocks (RSI<30) and noticed EBAY. I checked out CFRA's analysis via my online brokerage. That's the biggest difference I've seen in price vs. valuation so far. Two questions:
[link] [comments] |
| Is there a library where we can see all the back testing done? Posted: 19 Dec 2021 11:30 AM PST Obviously not all back tests are logged, but surely someone has backtested millions of portfolios over 50 years to find the best performers? A computer should be able to handle this no problem I would think. Or is it proprietary information you might be able to pay to see? I've found 2 portfolios that back test insanely well and it led me to wonder what's even better. And I'm talking about minimal upkeep, like just rebalancing annually. Any thoughts? [link] [comments] |
| Different types of DCF Models? Posted: 19 Dec 2021 04:04 PM PST I've been trying to build a DCF model for some time and want to have a thorough understanding of it. I've seen DCF models that are driven by EBIT REVENUE CASHFLOW I'm curious to see what others use and their reasoning of one DCF model vs another, and when I may resort to one over another. Love to hear your thoughts, or if you use something else entirely! [link] [comments] |
| Daily General Discussion and Advice Thread - December 19, 2021 Posted: 19 Dec 2021 02:01 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! 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] |
| You’re over exposed to Real Estate Posted: 18 Dec 2021 10:11 AM PST Most people consider their home to not be part of their investment portfolio even though it could be 90% of their net worth. But I'm curious whether home ownership impacts what portion of someones investment portfolio they allocate to real estate, if any is allocated at all? Personally I don't own a home so am looking to put about 20% of my portfolio into REITs. But I couldn't imagine doing that if I already owned a home. I suppose the best way to think about it is it's not part of your investments but it's part of your risk? And therefore your exposure? Meaning many home owners are heavily over exposed to Real Estate especially since many are leveraged on it. Thoughts? [link] [comments] |
| Is Tax loss harvesting needed if I am not selling at all Posted: 18 Dec 2021 03:49 PM PST Unfortunately, due to my visa issues, I am not able to get an account on any of the automated investing platforms / robo advisors, many of which claim tax loss harvesting is a big advantage. So I just have a regular brokerage account that I make trades on. Assuming that I never sell at all. Do i actually need tax loss harvesting? Is it only needed if..I expect to liquidate some stocks, but i also expect some stocks to underperform and continue to do so. Hence I want to offset my tax liability by selling some of those stocks. Or also in the case of getting dividends and such Is that the logic? [link] [comments] |
| How do yall feel about financial youtubers such as Mark Tilbury/Graham? Posted: 18 Dec 2021 04:56 PM PST So, I actually really like Graham's videos but for me in my opinion, I dislike Mark Tilbury's since they seem very out of touch with reality. His videos are basically stuff that are like "If you're homeless just buy a house and rent it out for passive income!" or "if you want to get a raise just work harder!" I found one video in particular such as this one where he goes from $0-1,000,000 NW from scratch again, except not really. its all hypothetical which frustrated me. it would have been genuinely awesome to see him in 2021 going from 0-1m and his genuine real life journey through it. instead it's "well hypothetically I get a job! boom, instant 10k. now I start an online business. boom. another 10k!!" which is just crazy. sure I can maybe see 10k if you're living with your parents but your literal first side hustle ever brings in an extra 10k with no experience ever in the first year?!? it's just all "hypothetically speaking if I were poor I'd work hard and become rich!" stuff again [link] [comments] |
| Posted: 20 Dec 2021 01:48 AM PST When I woke up this morning and checked the stock market futures I knew they would be down. Not with 100% certainty.. but I knew. (Because of the scary news stories about COVID impacting market psychology.) The big Wall Street Banks, Large Individual Investors, and Hedge Funds know that statistically certain types of news stories are more likely to move the Stock Market as a whole and individual stocks up and down. They use a variety of mathematical models based on events to predict how news stories will impact stock movements in the short run. In some cases, they have the ability to buy or sell stocks the second the news is released or have access to the information well before the public. They also use historical models that show how certain types of incidents have impacted stock prices. Anyone here doing short-term trading of stocks based on breaking news or the mood of the market due to the issues of the day? [link] [comments] |
| Turkish Lira investing. Too soon? Posted: 18 Dec 2021 01:27 PM PST The Turkish Lira keeps devaluating against € and $. Since last time I've been there, I got 4 Lira for €1. Now it hit 19 Lira for 1 EUR. Is Erdogan able to turn the tables? Or will this be the next Venezuela. They are no member of the EU. So they won't get financial support like Greece got. Just wondering if investing now would be a good idea. Does someone has some better understanding into the Turkish markets? Could not find any decent info in regards to this. [link] [comments] |
| $27.11 Spread on $SPY. Did the shorts cover post Quadruple Witching?! Posted: 19 Dec 2021 11:25 AM PST I was doing some TA on SPY with RSI and it looks like SPY is about to breakout. Then I noticed in the top left of Trading View a $27.11 spread on SPY. Am I crazy or are we gapping up Monday post Quadruple Witching? Link: https://ibb.co/WzhjVB5 SPY 149,681,807 Shares Sold Short: https://fintel.io/ss/us/spy During an uptrend, the RSI tends to stay above 30 and should frequently hit 70. During a downtrend, it is rare to see the RSI exceed 70, and the indicator frequently hits 30 or under. Friday at close: RSI above 30 indicating a bullish trend is about to start despite SPY price hitting $459. Big picture: Higher lows and RSI staying above 30, lower highs for RSI, Bullish AF. In my opinion, the Friday sell-off was because England raised their interest rates which makes NO logical sense when their country is a hotspot for the new variant. The rest of Europe didn't and won't raise interest rates in 2022 because of the variant. The CDC states this is going to get terrible in the U.S and the media says it's mild when it's not. You need to look at the hospitalization data closer and you will realize it's significantly worse than Delta. Read below, "CDC issues grim forecast warning that weekly COVID cases will jump by 55% to 1.3 MILLION by Christmas Day and that deaths will surge by 73% to 15,600 a week as Omicron becomes dominant strain." Then look at the New York City data, NY Reports Highest Single-Day Case Total of Pandemic. This variant is extremely contagious, the bull run is just starting. Our gov won't let the economy crash causing permanent damage to the economy when the pandemic is starting again. [link] [comments] |
| Investopedia's Cost of Debt formula is wrong Posted: 18 Dec 2021 02:19 PM PST I think it's wrong ever since lease expenses were capitalised thus dilluting the cost of debt. Also, from Investopedia's page on WACC, Determining the cost of debt (Rd), on the other hand, is a more straightforward process. This is often done by averaging the yield to maturity for a company's outstanding debt. This method is easier if you're looking at a publicly traded company that has to report its debt obligations. Couldn't the cost of debt be calculated using the interest expenses for the latest period divided with the total (interest bearing debt + leases) extracted from the Statement of Cash Flows? Since leases hold no interest but are an essential part of capital shouldn't they lower the cost of debt and increase the market value of the firm's debt? [link] [comments] |
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