EPTVanguards equity allocation performed better than a cap weighted split due to things like currency, volatility etc,,. Between them and Blackrock ishares, I have little concerns on the equity allocation because there is some academic research behind it.
Trading/Investing Thread - Page 36
| Forum Index > General Forum |
|
CorsairHero
Canada9491 Posts
Vanguards equity allocation performed better than a cap weighted split due to things like currency, volatility etc,,. Between them and Blackrock ishares, I have little concerns on the equity allocation because there is some academic research behind it. | ||
|
Vivax
22158 Posts
SNB only knows how to buy tech stocks to weaken the Franc amid the rush to it, but it looks like they're buying € now too. Are techies about to be taken over by Switzerland? Or do they start buying something else with the crazy money inflows?Maybe even peg their currency again. ![[image loading]](https://pbs.twimg.com/media/EZCQ-cIWsAMylrC?format=jpg&name=900x900) Chart by none other than Mike J. Burry, posted yesterday. That's one way of showing ETFs aren't in a bubble, they arethe bubble. | ||
|
hunts
United States2113 Posts
| ||
|
CorsairHero
Canada9491 Posts
| ||
|
FiWiFaKi
Canada9859 Posts
On May 30 2020 12:50 hunts wrote: I tried my hand at options trading with a bit of extra money, so far gained this week. Was lucky enough to get into DKNG before it blew up, and trying to hold some UNFI hoping for a pre earnings run up on monday/tuesday. Been too scared to try my hand at SPY with how erratic it has seemed this week. Am I being dumb here and risking too much by trying options? Yes, options are a zero sum game, and generally the selling side has a small edge statistically. Very very few people trade for 5-10 years. It becomes a get paycheque, put $1000 in, try to make that $50k in 3 months, and but get wiped out 99% of the time. Especially those really short term ones, it becomes a game of poker, I don't view it as a valid way to earn a living. The safest option is to buy an index etf, if you're okay with more volatility, I would recommend buying a few stocks that you think will be more successful from a fundamentals standpoint than the average population, and put an increasing percentage to those few stocks opposed to SP500. Take out margin for even higher volatility and higher expected returns. No need to get greedy chasing insane returns, be happy taking 5% returns on your positions. 15% for 40 years is 268x your original investment. On the topic of selling options though, have you guys looked at covered call ETF's? Any thoughts? | ||
|
CorsairHero
Canada9491 Posts
On May 29 2020 01:51 Vivax wrote: Chart by none other than Mike J. Burry, posted yesterday. That's one way of showing ETFs aren't in a bubble, they arethe bubble. Jesus christ lmao. The largest S&P500 ETF index is 270 billion which is SPY. The market cap of the S&P 500 is 28 trillion. | ||
|
FiWiFaKi
Canada9859 Posts
On May 30 2020 14:19 CorsairHero wrote: Jesus christ lmao. The largest S&P500 ETF index is 270 billion which is SPY. The market cap of the S&P 500 is 28 trillion. But the 8 largest ETF'S are 1 trillion. A few minutes of research showed me that there over 4 trillion in ETF's in the US. That doesn't include mutual funds that just create a portfolio to mirrors the SP500 very closely, or all the foreign ETF's. Imo it's a growing problem, and for sure its not a particularly efficient way for money to be distributed. | ||
|
CorsairHero
Canada9491 Posts
On May 30 2020 14:30 FiWiFaKi wrote: But the 8 largest ETF'S are 1 trillion. A few minutes of research showed me that there over 4 trillion in ETF's in the US. That doesn't include mutual funds that just create a portfolio to mirrors the SP500 very closely, or all the foreign ETF's. Imo it's a growing problem, and for sure its not a particularly efficient way for money to be distributed. Did you even look at the 8 largest ETF to see what they are? Hint, Vivax and I are talking about the S&P 500 The global equity market cap is 90 trillion and bonds are 100 trillion. To be worried about 4 trillion of ETF's is pointless. Who cares. | ||
|
FiWiFaKi
Canada9859 Posts
Another article I found said that 6% was invested passively 10 years ago, and now it's 12% in the US. To me it just seems like at some point it will matter with the current trend. But I agree with you that at the current level it won't break the system. | ||
|
Chocolate
United States2350 Posts
On May 30 2020 12:50 hunts wrote: I tried my hand at options trading with a bit of extra money, so far gained this week. Was lucky enough to get into DKNG before it blew up, and trying to hold some UNFI hoping for a pre earnings run up on monday/tuesday. Been too scared to try my hand at SPY with how erratic it has seemed this week. Am I being dumb here and risking too much by trying options? I think the only time retail traders should speculate on options is if they have very good information about a short term movement, but obviously not insider info. For example, maybe you're driving down the street and see a big fire at the local widget factory and immediately stop and buy puts on the company. Or you're a software engineer and you see a big company is looking to hire people who are experts in using AcmeCo's SAAS - looks Acme just did or is about to land a huge deal. A great real-life retrospective example is how hardware geeks new that Ryzen had the potential to completely revive AMD once they released their first specs - you would have made an absolute killing if you got into long-dated calls when they announced Ryzen. Options can still be very advantageous for their "real" purpose of collecting/paying premium to lock in prices but that's quite different from just using them as a way to easily make highly levered trades. For example I sell OTM calls on many stocks I own with strike prices at which I would consider the stock overvalued, which is very different from buying far OTM calls set to expire a week in advance hoping you'll 10X. In those cases I think institutional investors/traders will eat you alive as the information disparity between them and you is actually much greater in the short term than in the long term. | ||
|
Vivax
22158 Posts
The market cap can implode extremely quickly on heavy volumes. The price change isn't linear. As an easy example, when one guy sells a trillion, the next guy will have to sell the same amount for half a trillion if he wants out as long as the exchange finds no buyers at the price for the volume the first guy sold for, etc. You can only sell stuff at the price the exchange is willing to pay for it. When you speak of trillions, you aren't speaking of intrinsic value, but of the value the exchanges have set at a specific point. | ||
|
CorsairHero
Canada9491 Posts
| ||
|
Vivax
22158 Posts
On May 30 2020 16:26 CorsairHero wrote: we're talking about your bullshit statement about ETFs "is" a bubble The junk bond ETF had to be rescued by the Fed. While I can't estimate how much it can spill over into the others or affect the issuer, that's one bubble popped. The question I see unsolved here is: If QE over all these years was buying corporate bonds, why does the fed now step in to buy a corporate bond ETF instead of bonds directly like before? Maybe it's not just the bonds, but the ETFs problem now. | ||
|
CorsairHero
Canada9491 Posts
you're not even aware of what you previously post | ||
|
pmh
1399 Posts
Call=put. Selling a covered call option is the same as selling a naked put option. My though is that its is a bad moment to now sell a naked put or covered call. On the contrary. its a good time to buy naked puts. Vix is low,buy fotm. You can be wrong 9 times but the one time you are right will still make up for it. | ||
|
FiWiFaKi
Canada9859 Posts
On May 30 2020 21:09 pmh wrote: On the topic of selling options though, have you guys looked at covered call ETF's? Any thoughts? Call=put. Selling a covered call option is the same as selling a naked put option. My though is that its is a bad moment to now sell a naked put or covered call. On the contrary. its a good time to buy naked puts. Vix is low,buy fotm. You can be wrong 9 times but the one time you are right will still make up for it. I meant comparing SP500 vs holding SP500 and writing calls for them (but in an ETF, so the income from selling the options would be a dividend so 15% withholding tax), plus a higher MER. Would there be a time that it would yield higher average returns opposed to just holding the index? For example, if I theoretically expected the SP500 to be between - 5% and 15% return for the next 2 years. | ||
|
pmh
1399 Posts
Say S&P is 3000 and you buy the index and sell a call 3450 2 years ahead. Its exactly the same as selling the naked put 3450 2 years ahead. You can check this for yourself with the prices. If the index stays below 3450+the price you got for selling the call,or below 3450+the premium on the put (not the price but the part above intrinsic value) then you are better off then simply going long,if it goes above that then you are off worse. You can be both better off and worse off depending on what will happen. | ||
|
[UoN]Sentinel
United States11320 Posts
On May 30 2020 12:50 hunts wrote: I tried my hand at options trading with a bit of extra money, so far gained this week. Was lucky enough to get into DKNG before it blew up, and trying to hold some UNFI hoping for a pre earnings run up on monday/tuesday. Been too scared to try my hand at SPY with how erratic it has seemed this week. Am I being dumb here and risking too much by trying options? Don't listen to the haters, you'll be fine, just follow your nose | ||
|
[UoN]Sentinel
United States11320 Posts
| ||
|
GreenHorizons
United States23608 Posts
On June 02 2020 02:37 [UoN]Sentinel wrote: 50 cities are on fire but green line go up It's a catastrophic game of hot potato/musical chairs in my rudimentary estimation. Lots of money to be made before the music stops though. | ||
| ||
