EPTTrading/Investing Thread - Page 35
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LegalLord
United States13779 Posts
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Vivax
22158 Posts
On May 26 2020 22:58 LegalLord wrote: Not surprising that the stock market went up this morning. The current wave of the virus is starting to slowly level off, businesses are getting the go-ahead to start to reopen, and everyone's looking forward to the miracle recovery. Only once it becomes clear that the miracle isn't happening will the economy start to push back downwards. I expect that to happen after the virus is mostly under control rather than right now. Heh, that's an optimistic take. I believe the picture under the surface is much much uglier. Trump won't let the actual problems come to the surface on his election year and with his stock market obsession, but he has limits. I think the entire commodity futures market is toast, oil gonna crash again, copper also had its volume moved into July on the cme website. The Fed can't put that stuff on their balance sheet, so they use CME group as the special purpose vehicle to hide deflation. Btw nice headline: ECB SEES DEBT-SUSTAINABILITY RISKS AFTER PUBLIC VIRUS SPENDING What do you call it when an institution creates solutions that turn out to be problems afterwards right away? Btw not even two weeks ago they were calling for more debt. Checked the bio of a spanish guy today (de guindos) who works for the ECB and he was an advisor to Lehman in 2006. Lagarde has also been convicted for fraud by the IMF. Apparently to lead a central bank you need to be a pro at bankrupting things or stealing money. | ||
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LegalLord
United States13779 Posts
In other words, I suppose it's better to say that "the economy" is already down, but the "stock market" is bucking the historical trend and serving as a lagging indicator this time around due to heavy money-print. We're still in the "don't bet against America / the Fed / stonks always go up" phase of this game. This, too, will pass. On May 26 2020 23:19 Vivax wrote: Apparently to lead a central bank you need to be a pro at bankrupting things or stealing money. Pretty much all of them have IMF or World Bank or US investment bank cred, yes. You have to have a strong investment in keeping the western financial house of cards afloat to be allowed to play games with the money supply. | ||
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Vivax
22158 Posts
I guess the strength of EU diversity is showing itself in being able to disagree with each other on a direction dictated by a central bank. | ||
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FiWiFaKi
Canada9859 Posts
Ended up selling TD at 59.84 today (up around 7% from 2 months back, plus 2x leverage), there's some correlation between the big 5 earnings, but I don't agree with the thinking of 1 going up means all of them will. I guess we will see if RBC and BMO tomorrow, and then CIBC and TD on the 28th. Imo the best case scenario is they all have those 7-10% earnings, and the stock goes up another 3%, and bad case scenario is it goes back to where it was, dropping 6%, but my thinking as someone who's buying a property now.... I think a lot of people are being saved by the mortgage deferrals, and prices haven't been going down as much because people don't like selling at a small loss, and when they see the recovery isn't happening very quickly, they'll need to sell. Well, I'm almost all in on cash right now, so will be looking for the next opportunity. Imo a 12%+ correction will happen this year, but no idea when. Sentiment is really high right now. And a question for you guys, where do you park your money when you expect a bear market? HISA's pay like 1% at the big banks, and I'm not too eager to open up another account at one of those online banks like Tangerine to get closer to 2%. GIC's seem to do almost the same, but not accessing capital for a year is a big no-no for me, and considering they are also around 2% (or 1% at the big banks), seems even worse. And then there's bond ETF's like ZAG, which seem quite appealing, with a 2.7% return currently (and last year 3%), but it's at ATH right now, and given you get 4 cents per month, and last year it was 80 cents lower, has higher inherent risk, if my expectation was that it has equal chance to go up as down, I wouldn't worry though. The sample size is small, only from 2011, always bouncing between 15-16.70... Do these work as traditional bonds though, because the price seems rather stable, but I would have expected that as interest rates rise, current bond value decreases until they match new bond interest rates, so the graph should be a bit of the inverse of treasury rates, right? So if my expectation would be that for the next 6 months that interest rates remain the same, from a fundamental level, should the ETF remain at the same price (and maybe a lower dividend yield because the higher interest bonds are expiring and they need to buy more newer low interest bonds?) Never looked at bond investing... | ||
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ShoCkeyy
7815 Posts
On May 27 2020 07:02 FiWiFaKi wrote: I think the Scotiabank earnings report is responsible for the 6% gain in the big 5 banks, as well as the CAD/USD appreciation. Ended up selling TD at 59.84 today (up around 7% from 2 months back, plus 2x leverage), there's some correlation between the big 5 earnings, but I don't agree with the thinking of 1 going up means all of them will. I guess we will see if RBC and BMO tomorrow, and then CIBC and TD on the 28th. Imo the best case scenario is they all have those 7-10% earnings, and the stock goes up another 3%, but as someone who's buying a property now.... I think a lot of people are being saved by the mortgage deferrals, and prices haven't been going down as much because people don't like selling at a small loss, and when they see the recovery isn't happening very quickly, they'll need to sell. Well, I'm almost all in on cash right now, so will be looking for the next opportunity. Imo a 12%+ correction will happen this year, but no idea when. Sentiment is really high right now. And a question for you guys, where do you park your money when you expect a bear market? HISA's pay like 1% at the big banks, and I'm not too eager to open up another account at one of those online banks like Tangerine to get closer to 2%. GIC's seem to do almost the same, but not accessing capital for a year is a big no-no for me, and considering they are also around 2% (or 1% at the big banks), seems even worse. And then there's bond ETF's like ZAG, which seem quite appealing, with a 2.7% return currently (and last year 3%), but it's at ATH right now, and given you get 4 cents per month, and last year it was 80 cents lower, has higher inherent risk, if my expectation was that it has equal chance to go up as down, I wouldn't worry though. The sample size is small, only from 2011, always bouncing between 15-16.70... Do these work as traditional bonds though, because the price seems rather stable, but I would have expected that as interest rates rise, current bond value decreases until they match new bond interest rates, so the graph should be a bit of the inverse of treasury rates, right? So if my expectation would be that for the next 6 months that interest rates remain the same, from a fundamental level, should the ETF remain at the same price (and maybe a lower dividend yield because the higher interest bonds are expiring and they need to buy more newer low interest bonds?) Never looked at bond investing... It really depends, I have a few assets, like I own a house back home that I'm renting out, and sometimes I'll drop the ROI into upgrades there. I've also been buying small plots of land in the north to try and combat big banks and big oil from purchasing it up and fucking the environment up. If not, I park it here https://www.marcus.com/us/en - last year I was hitting 2% in savings, it dropped to 1.3% now. I love the fact they were one of the first big banks to pull out of Fossil Fuels, I've been with them for the past 10 years, so I'll keep all my savings here as long as possible. https://www.greenamerica.org/blog/goldman-sachs-ends-financing-fossil-fuel-projects-arctic | ||
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No0n
United States355 Posts
On May 26 2020 23:19 Vivax wrote: Heh, that's an optimistic take. I believe the picture under the surface is much much uglier. Trump won't let the actual problems come to the surface on his election year and with his stock market obsession, but he has limits. I think the entire commodity futures market is toast, oil gonna crash again, copper also had its volume moved into July on the cme website. The Fed can't put that stuff on their balance sheet, so they use CME group as the special purpose vehicle to hide deflation. Btw nice headline: What do you call it when an institution creates solutions that turn out to be problems afterwards right away? Btw not even two weeks ago they were calling for more debt. Checked the bio of a spanish guy today (de guindos) who works for the ECB and he was an advisor to Lehman in 2006. Lagarde has also been convicted for fraud by the IMF. Apparently to lead a central bank you need to be a pro at bankrupting things or stealing money. Contracts close trading on the third friday of the month before expiration e.g. the may contract closed on april 24, that's why so many people were getting rid of it and drive oil prices negative. June contract just closed trading on friday, so now everyone is trading julys. Nothing really to do with price action or what not. | ||
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mikedebo
Canada4341 Posts
On May 27 2020 07:02 FiWiFaKi wrote: I think the Scotiabank earnings report is responsible for the 6% gain in the big 5 banks, as well as the CAD/USD appreciation. Ended up selling TD at 59.84 today (up around 7% from 2 months back, plus 2x leverage), there's some correlation between the big 5 earnings, but I don't agree with the thinking of 1 going up means all of them will. I guess we will see if RBC and BMO tomorrow, and then CIBC and TD on the 28th. Imo the best case scenario is they all have those 7-10% earnings, and the stock goes up another 3%, and bad case scenario is it goes back to where it was, dropping 6%, but my thinking as someone who's buying a property now.... I think a lot of people are being saved by the mortgage deferrals, and prices haven't been going down as much because people don't like selling at a small loss, and when they see the recovery isn't happening very quickly, they'll need to sell. Well, I'm almost all in on cash right now, so will be looking for the next opportunity. Imo a 12%+ correction will happen this year, but no idea when. Sentiment is really high right now. And a question for you guys, where do you park your money when you expect a bear market? HISA's pay like 1% at the big banks, and I'm not too eager to open up another account at one of those online banks like Tangerine to get closer to 2%. GIC's seem to do almost the same, but not accessing capital for a year is a big no-no for me, and considering they are also around 2% (or 1% at the big banks), seems even worse. And then there's bond ETF's like ZAG, which seem quite appealing, with a 2.7% return currently (and last year 3%), but it's at ATH right now, and given you get 4 cents per month, and last year it was 80 cents lower, has higher inherent risk, if my expectation was that it has equal chance to go up as down, I wouldn't worry though. The sample size is small, only from 2011, always bouncing between 15-16.70... Do these work as traditional bonds though, because the price seems rather stable, but I would have expected that as interest rates rise, current bond value decreases until they match new bond interest rates, so the graph should be a bit of the inverse of treasury rates, right? So if my expectation would be that for the next 6 months that interest rates remain the same, from a fundamental level, should the ETF remain at the same price (and maybe a lower dividend yield because the higher interest bonds are expiring and they need to buy more newer low interest bonds?) Never looked at bond investing... I felt the same at first re: opening a Tangerine account for the 5 months at 2%, but I just did it last week and it took like literally 10 mins. Transfers were quite easy too. Not sure where your reticence is coming from, but I sense it's more than just the effort required. I figured I might as well leave it there as I consider other conservative options. Right now I'm going to stay invested in stocks in my RRSP (that's a very long run), but I'm liquidating everything else. Even if the market has room to grow beyond here, I think we're in wackyland right now and I'm actually kind of disgusted at how high the stock market can stay when everything else is such a disaster. I understand the potential reasons for it, but I don't have to like it. | ||
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FiWiFaKi
Canada9859 Posts
On May 27 2020 08:09 mikedebo wrote: I felt the same at first re: opening a Tangerine account for the 5 months at 2%, but I just did it last week and it took like literally 10 mins. Transfers were quite easy too. Not sure where your reticence is coming from, but I sense it's more than just the effort required. I figured I might as well leave it there as I consider other conservative options. Right now I'm going to stay invested in stocks in my RRSP (that's a very long run), but I'm liquidating everything else. Even if the market has room to grow beyond here, I think we're in wackyland right now and I'm actually kind of disgusted at how high the stock market can stay when everything else is such a disaster. I understand the potential reasons for it, but I don't have to like it. That's good to know, thanks for the anecdote. I guess for me it was a combination of factors, like when I had 50k I was working with, and potentially only putting it away for 3 months, 2% on that would've been $250, and I just assumed there might have been some fees on TD's end, spend hours on the phone, and then if a good opportunity came up maybe up to a week to get funds moved, plus I know they waive some fees with TD Direct Investing when you have a certain portfolio size with them. So I kind of put off looking into it. But now that I'm wanting to put 200k somewhere it's more reasonable. And I also have this notion that these banks are some guy working from his mom's basement, and I don't like the idea of putting so much trust into these companies (and they've all been around for only a couple years)... Versus institutions like RBC and TD, so for the relatively small benefit I didn't really want to give my money to a far less trustworthy entity. Whenever I hear some individual uses Robinhood or something similar to trade I just cringe and thank they exist because they're the ones who allow high market returns for everyone else. I agree with your view of the market, though I prefer to not take that emotional stand point, if there's money to be made, I'm not going to shy away from it because I don't agree with it. My theory is that everyone is being very bullish because this is the first big crash we've had in a long time, and they've been told to invest after a market crash... But eventually it'll become unsustainable and once it crashes again (just slower this time), this money will leave the market for longer. I don't think the market is severely overvalued actually, just a little bit. If it was a thing, I think the intrinsic value of the sp500 at its low was 2550, and now is 2800. | ||
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CorsairHero
Canada9491 Posts
On May 27 2020 07:02 FiWiFaKi wrote: And a question for you guys, where do you park your money when you expect a bear market? The same as a bull market obviously. Its funny watching the market timers squirm over what so far has been a V shaped recovery and try to figure out their way back in because they have no idea and didn't see this coming. | ||
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FiWiFaKi
Canada9859 Posts
On May 27 2020 09:57 CorsairHero wrote: The same as a bull market obviously. Its funny watching the market timers squirm over what so far has been a V shaped recovery and try to figure out their way back in because they have no idea and didn't see this coming. Well since I stopped just leaving my money in a mutual fund, Sp500 has gone up 11% till today, and I'm up 23%, and that was with one buy-sell-buy operation on the safest ETF's and largest companies (though some luck was definitely on my side). If sometime in the next month the SP500 falls below 2850 for even a second, add another 4% to that. Ah, we will see, I'm trying to do it very low risk, not touching options, eventually I'm sure I'll stay out and lose out on a 15%+ continuous bull run, but my brain, and my small sample size of paper trade experimenting of 10-12 market timing trades in the last 6 months would have had me up over 25% more. For sure if you're investing with 20k it's not worth spending the extra time to try and make more versus just making more through your employer, but I think individual investors have a lot more liberty with their investing strategy that institutional investors that have someone to answer do simply can't do (and therefore they can't perform optimally). Good luck having a mutual fund investor justifying a 75% cash position to the stakeholders lol. I believe that if the behavior of all people was rational, the concept of a business cycle wouldn't even exist, and you wouldn't have 5 oscillations of over 5% back up in the course of 2 weeks as the SP500 was going down. edit: And tbh, seems like you're trying to make it a bit of a personal thing.There's no squirming, this isn't WSB strategies of SPY 160p 5/29 life savings. For some people it's just some low risk theorycrafting that they find enjoyable. I'd still put myself more in the camp of passive investor rather than active (couch potato also asks for redistribution based on performance of investments)... But btw, stock markets wouldn't work at all if every investor took the couch potato investing strategy  | ||
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CorsairHero
Canada9491 Posts
Theres a youtuber with 6 digit subscribers who made a video a few months ago on liquidating his portfolio and was buying back in when the dow hit 15K. Obviously that never happened and maybe he embarrassingly bought back in but who knows. It would be interesting to see how much capital gain contributes to total return compared to the reinvested dividends over a multiple decade period. Markets are efficient enough that I don't care to make moves based on a tweet from fat donnie. Calculating the intrinsic value of VFV isn't something that I bother with since I hold a 5 digit number of companies across the globe. I'll admit, I'm too lazy to calculate the true value of the global stock market and maybe that means I'll have lower returns because I don't time but oh well, i'll take my chances. | ||
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FiWiFaKi
Canada9859 Posts
![[image loading]](https://i.imgur.com/RJoB9Sq.png) I know I'm cherry picking extreme time periods, but in the long run picture, we're at a fairly sharp peak, so looking at the graph from 2009 and trying to extend it's risky, because that little mountain we're climbing is awfully similar looking to that one from 1995-1999. Last 25 years we've had an average dividend of 2%, it was a lot higher before that, but so was inflation, in the last 50 years, dividends never really exceeded inflation (one year anomaly here and there from some big events). I agree that a tweet from the president shouldn't swing the market multiple percentage points, but because it impacts peoples' emotions and it does change the market significantly short term, if you can play psychologist, there should be money to be made in theory. I don't think you should give a number of when you'll buy/sell, because market conditions change, but it's tricky, because you're more likely to let your emotions take over if you're modifying a strategy during a big win or loss. Like when COVID comes around maybe you tell yourself you want to buy when the market drops 40% based on how you think the world response will be, but you need to be able to objectively look at the situation after it drops 30%, what things will cause it to drop more, what will make it go higher, and the probabilities of both, and be able to say that oh, it only has a 30% of reaching that 40% drop now, more logical is to buy now. Kind of same thing I did today with TD bank, where the additional gain from positive earnings wont make nearly the same impact as the drop from expected earnings. edit: For Kwark + Show Spoiler + ![[image loading]](https://i.imgur.com/tJF7yb0.png) | ||
KwarK
United States43529 Posts
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CorsairHero
Canada9491 Posts
![[image loading]](https://www.mindfullyinvesting.com/wp-content/uploads/SP-500-Price-vs.-Divident-Reinvest.jpg) | ||
Spazer
Canada8033 Posts
On May 27 2020 08:35 FiWiFaKi wrote: That's good to know, thanks for the anecdote. I guess for me it was a combination of factors, like when I had 50k I was working with, and potentially only putting it away for 3 months, 2% on that would've been $250, and I just assumed there might have been some fees on TD's end, spend hours on the phone, and then if a good opportunity came up maybe up to a week to get funds moved, plus I know they waive some fees with TD Direct Investing when you have a certain portfolio size with them. So I kind of put off looking into it. But now that I'm wanting to put 200k somewhere it's more reasonable. And I also have this notion that these banks are some guy working from his mom's basement, and I don't like the idea of putting so much trust into these companies (and they've all been around for only a couple years)... Versus institutions like RBC and TD, so for the relatively small benefit I didn't really want to give my money to a far less trustworthy entity. Whenever I hear some individual uses Robinhood or something similar to trade I just cringe and thank they exist because they're the ones who allow high market returns for everyone else. I agree with your view of the market, though I prefer to not take that emotional stand point, if there's money to be made, I'm not going to shy away from it because I don't agree with it. My theory is that everyone is being very bullish because this is the first big crash we've had in a long time, and they've been told to invest after a market crash... But eventually it'll become unsustainable and once it crashes again (just slower this time), this money will leave the market for longer. I don't think the market is severely overvalued actually, just a little bit. If it was a thing, I think the intrinsic value of the sp500 at its low was 2550, and now is 2800. Tangerine is a subsidiary of Scotia, and Simplii is literally run by CIBC. Both have been around for at least 20 years, albeit under different names. There are valid reasons to prefer big banks, but trustworthiness isn't one of them. They're CDIC insured anyways. Their no fee credit cards are pretty popular too. | ||
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FiWiFaKi
Canada9859 Posts
(1+i)^150 = 40000 so i = 8.98%~ i = i_cap + i_div i_div = 4.27%~ Thought my graph wasn't great! On May 27 2020 15:19 Spazer wrote: Tangerine is a subsidiary of Scotia, and Simplii is literally run by CIBC. Both have been around for at least 20 years, albeit under different names. There are valid reasons to prefer big banks, but trustworthiness isn't one of them. They're CDIC insured anyways. Their no fee credit cards are pretty popular too. I'll take a look, that 2.8% introductory rate for 5 months is very nice (might even be an arbitrage opportunity, Tangerine 2.35% Heloc, make 0.45% on 1 million for 5 months, so a free $1875 if you have the real estate?) My father is one of those people that runs around signing up for different credit card offers and whatnot, then gets a few free flights and hotels every year. The credit cards don't seem to have too many perks over the TD one I have (cost is waived if you have 5k in your account, which I like to have just for sort of emergency type stuff, pay off credit cards, etc... Otherwise $120/year). I know I have a friend with both RBC and BMO, and I was telling them they should look into a free "premium" card with their bank, and they didn't have one, so maybe an issue for other Canadians. But yeah, I never looked into Simplii or Tangerine closely, but they don't seem half bad for every day banking for the average person. | ||
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Vivax
22158 Posts
Gratz on pulling profits from a bank stock. I wouldn't put my money into a bank stock these days. But whatever works works I guess. If you want to go super defensive, there's money market funds and phys. metals, but you don't go there for yield, rather to avoid a haircut, negative rates or a systemic bank failure if you think it's coming. On May 27 2020 09:57 CorsairHero wrote: The same as a bull market obviously. Its funny watching the market timers squirm over what so far has been a V shaped recovery and try to figure out their way back in because they have no idea and didn't see this coming. It's been V shaped if you only watched the Nasdaq (the equivalent of growth stocks, and leveraged to the hilt). Almost every other index is still down. Mind the gap. I thought every index would head for new highs when I tried to time the bottom but the divergences made me a pessimist again. Expecting a W-shape atm, but still needs a catalyst. | ||
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FiWiFaKi
Canada9859 Posts
Other thing is that I'm trying to put more money in things that get a lot of attention, they move more on inconsequential news because they have more individual investor money in them. I was looking at a lot of industrials, really I just went through companies one by one in the TSX (with an over 500mil valuation) and SP500, and looked at the basics... Went through maybe 50 quarterly reports a lot more closely for what caught my attention. And they seemed priced quite fairly for their balance sheets, meanwhile the stuff making the headlined is priced on the speculation of the future. I like O&G, car manufacturers (Ford or GM, not Tesla lol), and banks atm (software companies like Autodesk and Adobe would've been nice options too, don't like buying high when looking at historic data, but still think they have plenty of upside potential)... I think they have too much negative unwarranted speculation atm. I'm happy to take a step back for a week(s), and try to look at it objectively. | ||
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mikedebo
Canada4341 Posts
However I do speculate on a small percentage of my earnings each year, and this year I had more held in cash than normal. I spent that money in chunks on individual stocks each week during the COVID meltdown, and I'm up somewhere around 45% on that right now. I'm planning on some lifestyle changes in the next while, so I'm going to choose to be more conservative for a bit. I also feel a strong distaste around our financial systems in general so there's an element to selling out that is more about deliberate non-participation as well. Exciting times | ||
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