Daily General Discussion and Advice Thread - January 22, 2022 Investing |
- Daily General Discussion and Advice Thread - January 22, 2022
- John Deere is antagonizing it's customers for wrong reasons. The business model is not sustainable in the long term.
- Warren Buffett and Benjamin Graham: "In the short term, the market is a voting machine. In the long term, it's a weighing machine"
- I bought an option right before earnings to learn about IV crush. Turned a huge profit, learned nothing.
- What stocks/ETFs are you loading up on during this market dip?
- Rebalancing through deleveraging
- Question about bond index fund turnover rates
- Terrified for my Pops (57M)
- Long-term Investment Allocation
- 401k stable value funds during a downturn?
- How to invest during being in a potential crash?
- Last Week of January - Thoughts?
- It's time to buy Chinese stocks
| Daily General Discussion and Advice Thread - January 22, 2022 Posted: 22 Jan 2022 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] |
| Posted: 22 Jan 2022 08:39 AM PST John Deere is facing a farmer revolt This is not a discussion about right to repair! John Deer's business model is based on selling services for their equipment and this is obviously a great source for revenue, because any machine used in agriculture is used in an environment, which eventually will causing breakdowns. The foundation of this concept is solid and from a perspective of an investor, it couldn't be better. Adobe is here the template. From the perspective of a farmer the equipment is a part of his production has has to have a certain availability while in use. The venture to buy such equipment has high capital costs. Like in other sectors, a farmer wants to optimize it's production and any lack of availability of equipment has a financial impact. A breakdown of equipment of more than a day in a business depending on weather and biological processes, can turn agriculture into a bad business.
The optimization of business processes is a necessity, but defining optimization by delivering a bad service, when it's part of the core business, is bad practice. As a result
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| Posted: 21 Jan 2022 11:43 AM PST Borrowing this quote from Benjamin Graham, Warren Buffett's mentor, to remind investors during this turbulent time. In the short term, the stock market is simply a voting machine based on how other investors are feeling that day. Emotions obviously get in the way and play a large role in the day to day pricing of stocks. But in the long term, stocks will always move towards their intrinsic value. The price of a stock will be weighted based on fundamental factors such as revenue growth, free cash flow, profit and gross margin etc. During times like this during the market when it may be tempting to sell everything or stop investing all together, it's important to keep a long time horizon and continue to DCA in companies that you fundamentally believe in. Good luck to all! [link] [comments] |
| Posted: 21 Jan 2022 06:49 PM PST I'm sure all novice investors have gotten the idea to buy options before earnings in hopes of making outrageous money on big moves, only to be brought back down to earth by the IV crush concept. So yesterday (Jan 20) I bought one NFLX $400 PUT Exp. 1/28 for $56 in hopes of learning about the infamous IV crush from firsthand experience. This morning (Jan 21) I sold said put for $1500 and learned absolutely nothing of IV crush. Why didn't my put get crushed? Can someone actually explain how it works and when it does/doesn't happen? Thank you! EDIT: I think it's interesting that a lot of responses are "first time is always free" and "beginners luck". I've been trading regular stocks for 3 years, options for about 4 months. The only thing "first time" about this put is that it was intentionally purchased before earnings and not even for the sake of making money, I was fully prepared, even almost looking forward to losing the 56 bucks to get a lesson out of it. Guess I could've just asked Reddit lol. Its just no matter how much I've googled and YouTubed I haven't quite fully understood the iv crush concept. Even after great answers here I still don't get it all the way, I guess there's just multiple moving variables in calculating an options price that I need to dive deeper in understanding. [link] [comments] |
| What stocks/ETFs are you loading up on during this market dip? Posted: 21 Jan 2022 12:14 PM PST For long term holding (about 1-2y hold), this current market dip/downturn looks like a good opportunity to DCA downwards. Which stocks have you been buying and/or eyeing to buy in the very near future despite the known upcoming rate hikes? Personally I'm loading up on as much AMD and NVDA as possible (since I'm already heavy on AAPL, MSFT, etc). I've also been thinking about getting in on PayPal. But I'd be curious to hear what other people's picks are. [link] [comments] |
| Rebalancing through deleveraging Posted: 22 Jan 2022 01:00 AM PST I've got a small portfolio of shares that was purchased in the 2020 pullback through a mortgage redraw. We owe $80k on this loan but we could close it out and pocket $40k. If we were talking about say a 60/40 stocks/bond portfolio then you could rebalance by selling one and buying the other, but is there a similar approach when talking about leverage? Would paying down the mortgage with our current gains be equivalent to this? Is there a term I could search for? Or is it just "deleveraging"? Tia! [link] [comments] |
| Question about bond index fund turnover rates Posted: 21 Jan 2022 10:47 PM PST What's a good turnover percentage for a bond index fund? I understand that they're higher than other funds b/c they're constantly maturing out, but how high is too high? In particular I'm considering SWAGX, but a 53.65% turnover sounds high to me. Would someone here please provide some insight for me? This will be my first bond fund purchase and I'm trying to understand the particulars. (Thanks in advance!) [link] [comments] |
| Posted: 22 Jan 2022 10:14 AM PST After Covid, my Pops lost some money in his 401(k). I told him the market would come roaring back, but I also told him it felt like the government was propping up Main Street and consumer confidence. Specifically, I told him I was worried the market would crash early in 2022. At this point, it comes down to confidence. People will start pulling out because of FUD. Now I'm really concerned for him. He called a few months ago to say he finally hit the $1M mark after 20 years of saving. He is very worried about retiring in 3 years, but I've told him look: the house is paid off, your tax rate with drop, you won't have a car payment for a long while, and you'll get SS + my ma will get half of his entitlement separately. That said, what can he do to stave off the impending crash from decimating his 401(k)? [link] [comments] |
| Long-term Investment Allocation Posted: 21 Jan 2022 10:17 AM PST Hey guys, I would love some input and feedback on my long-term investment strategy. I am in my early 20's and unbeknownst to me until recently, a family member wrote some bonds in my name. I just cashed them out and while I do not want to give specifics, I have a sizable amount of $ to invest. I currently have about 75% of my portfolio in ETFs (long-term, do not touch), 15% in individual stocks, and 10% in crypto. I studied Finance in college and started investing in 2020. From then until mid-2021 I averaged about 40% annual returns, but I know that this was inflated by the post-lockdown bubble. I have been seeing some negative returns during this market downturn over the past 6ish months. Some of my top holdings include VTI, VGT, IBB in addition to many tech stocks and BTC/ETH. My question for y'all is, do you think I should add this new $ into the same asset allocation or consider other options? With rising interest rates I know that we are going to see lots of change. I am very open to new ideas but ideally would prefer to not have to worry about most of the investments and hold for the long-term. For reference, I've been looking into VOO, SPY, SDY, QQQ, IWF, and VYM but am not very confident about the major differences between them. Thanks in advance! [link] [comments] |
| 401k stable value funds during a downturn? Posted: 22 Jan 2022 09:37 AM PST I'll keep this short and sweet, my Roth 401k through my work has done great over the last 2 years and it's looking like the market is about to go through a solid correction. I know most investors and advisors will say "don't try to time the market when your investing long term" but my question is: should I transfer my current funds to money market/stable value fund available in my 401k to avoid big losses, while continuing distributions into my normal etf funds (essentially buying new shares on discount)? Once the market bottoms out, I can then re-transfer my money back into the ETFs I had (mostly blue chip and tech heavy funds), again, buying them cheaper than I sold for a few months/a year earlier. [link] [comments] |
| How to invest during being in a potential crash? Posted: 22 Jan 2022 04:59 AM PST ive got some money in s&p 500 with vanguard. i started this 2 months ago. now that the market seems to be going down and potentially crashing, how should i invest? normally i would invest X amount monthly. should i just carry on doing this? i was thinking of investing X/4 weekly now since the market seems to be going down. since we dont know when the market will reach its absolute pitfall before rising again, investing weekly would lower the average loss. is this a good idea? im keen to hear other people's thoughts. thanks in advance. [link] [comments] |
| Last Week of January - Thoughts? Posted: 21 Jan 2022 09:30 AM PST It seems to me that we are headed for a make it or break it week. VIX curve inverted today which could indicate that panic has peaked. Or it could indicate that panic has finally set in. With the Fed meeting next week, along with Microsoft, Tesla, and Apple reporting next week, we could either see a complete shift in mood and a significant recovery, or we could potentially see the gates of hell opening. Personally, I have a good deal of cash at hand ready to jump in if things go right, but I do not have any plans to buy before the Fed meeting. Also, I do not intend to buy any options. Instead, I'm thinking about using 2X & 3X sector and market ETFs to boost my returns. Thoughts? [link] [comments] |
| It's time to buy Chinese stocks Posted: 22 Jan 2022 04:38 AM PST Since interest rate rise in US, it be falling just like in 2000-2001 and 2008. And China is cutting interest rate and give more stimulus to growth. And many Chinese stocks are undervalued. And now if one is rising rate and one is cutting, China is winning big. [link] [comments] |
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