EPTTrading/Investing Thread - Page 94
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{CC}StealthBlue
United States36923 Posts
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zatic
Zurich14686 Posts
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LegalLord
United Kingdom13413 Posts
On January 11 2022 22:11 zatic wrote: Honest question: What is stopping Nvidia from selling their stuff at market prices? Market price for their consumer products is over 100% above list price, yet they don't capture this and give it to the grafters. I imagine market prices for their server and other professional business are also above list prices. They might be able to get away with a 10% global price hike, which it seems like they’re doing, but the only reason the scalper price is so high is because of the shortage. You wouldn’t actually be able to sell a whole lot at that very high price, not enough to be worth it for a large manufacturer. As far as a price discrimination strategy goes - their overpriced server GPUs are way more expensive (per unit computing power, not just purchase price) than their even consumer scalper-price GPUs, so they’re already doing that. Those are far less supply constrained. | ||
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{CC}StealthBlue
United States36923 Posts
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FreakyDroid
Macedonia378 Posts
On January 11 2022 23:21 LegalLord wrote: They might be able to get away with a 10% global price hike, which it seems like they’re doing, but the only reason the scalper price is so high is because of the shortage. You wouldn’t actually be able to sell a whole lot at that very high price, not enough to be worth it for a large manufacturer. As far as a price discrimination strategy goes - their overpriced server GPUs are way more expensive (per unit computing power, not just purchase price) than their even consumer scalper-price GPUs, so they’re already doing that. Those are far less supply constrained. GPU's have been sitting on the shelves of every major and even small retailers for many months now, yet the prices arent going down. That right there tells you what's going on. My guess is they will start going down when the 2nd hand market gets flooded with mined GPUs. Right now, most miners who bought at the end of 2020 and through the first half of 2021 are still profiting, but that might end soon. I've read quite a few articles in the 2nd half of 2021 and even today that put the blame on miners for the shortage, but that is absolutely not correct. It was true in the beginning of the shortage, but it is not correct now. Miners haven't been buying cards for the last 6-7 months, at least not the big and experienced ones. Once the market gets flooded with mined GPUs the retailers and manufacturers will start dropping the prices. Right now, there is no economic incentive to do so. | ||
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{CC}StealthBlue
United States36923 Posts
U.S. consumer prices soared last year by the most in nearly four decades, illustrating red-hot inflation that sets the stage for the start of Federal Reserve interest-rate hikes as soon as March. The consumer price index climbed 7% in 2021, the largest 12-month gain since June 1982, according to Labor Department data released Wednesday. The widely followed inflation gauge rose 0.5% from November, exceeding forecasts. Excluding the volatile food and energy components, so-called core prices accelerated from a month earlier, rising by a larger-than-forecast 0.6%. The measure jumped 5.5% from a year earlier, the biggest advance since 1991. The increase in the CPI was led by higher prices for shelter and used vehicles. Food costs also contributed. Energy prices, which were a key driver of inflation through most of 2021, fell last month. Source | ||
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{CC}StealthBlue
United States36923 Posts
So what I am trying to say if are still holding $HOOD now would be the best time to get out. The best time to bail would have been a couple months ago... | ||
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Emnjay808
United States4850 Posts
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LegalLord
United Kingdom13413 Posts
On January 15 2022 01:50 Emnjay808 wrote: Welp. I’m down more than 60% on SPCE. Now I’m starting to consider to cut my losses. Might be a good time to buy the dip, ahead of the Fed announcing that they're going to revise the inflation metric to reduce the apparent inflation rate so that they don't have to raise interest rates. SPCE is about at its lowest price in a long time, so if you think it might reinflate rather than revert to fundamentals (i.e. not being worth a penny more than its liquidation value since it's a waste of space) then you might indeed want to buy. Incidentally, my portfolio definitely took a hit the past couple of days. Something like a 5% loss, an unfortunate middle ground that's not enough to double down on my investments for, but also enough to be upsetting. | ||
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3FFA
United States3898 Posts
Portfolio + Show Spoiler + ![[image loading]](https://aws1.discourse-cdn.com/business7/uploads/rationalreminder1/optimized/2X/d/d751d48da8c997f4a4c4d6a89833a21f5713d84e_2_564x500.png) This was also discussed at length in a Reddit thread here: https://www.reddit.com/r/M1Finance/comments/rtepwx/monthly_rate_my_pie_portfolio_discussion_thread/hrmvtn6/?utm_source=share&utm_medium=web2x&context=3 ![[image loading]](https://i.imgur.com/4fCf0rT.png) If someone wants a 'better way' than stockpicking on your own this is probably as good as it gets without having access to private mutual fund versions of the above (i.e. AQR's Small Cap Momentum and International Momentum funds) and private alternative funds to diversify further with. Just be prepared to be very different from the market. I.e. comparing to the S&P 500 will be meaningless. Used 7% Gold as a proxy for 7% Long Term TIPs (which historically have performed slightly better than a 2x levered Gold fund and with lower volatility to boot) | ||
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Ryzel
United States380 Posts
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BlueBird.
United States3201 Posts
Probably will work out in the end if you need the higher return for risk, best of luck. | ||
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3FFA
United States3898 Posts
On January 16 2022 03:41 BlueBird. wrote: I am tilted small caps with the avantis funds, but I think that this all in factor approach particularly seems like it has higher volatility than I could stomach and i don't like paying such high expense ratios for the momentum funds. Probably will work out in the end if you need the higher return for risk, best of luck. Oh yeah, certainly. The factors require you to stomach it for essentially your entire time horizon. On the bright side, due to their higher risk/return they can be used to diversify across high risks (i.e. a 60/40 Small Cap Value/Intermediate Duration Bonds portfolio can historically achieve a similar or greater return to that of the S&P 500 while using fewer equities). It's like letting someone else stockpick for you without being exposed to any of the psychological stress of minute decisions that can cause poor decision-making. The stock-picking is systematic, rules-based in order to allow for a more balanced long-term portfolio. Only a few years ago similar small-cap value mutual fund equivalents to the Avantis ETFs cost about two to three times as much in expense ratio (more in line with the Momentum ETFs' expense ratios). But yeah, this is all based on the academic research, using what was found to provide statistically significant long-term outperformance across time periods, geographies, etc. while being investable and relatively intuitive. It does require sticking to the plan through periods of underperformance that can last a decade or two. In this case the overall market being VT rather than VTI / VOO / SPY On the 'all-in' aspect, I think it's more all-in to bet on concentrated unsystematic stockpicks, as many do, unfortunately. I do have a taxable account that uses NTSX to provide exposure to the S&P 500 as well though. On January 15 2022 22:09 Ryzel wrote: Thanks for this FFA, I need to Google what factor based investing is Let me know if you encounter any specific questions while learning about it! | ||
micronesia
United States23986 Posts
I just took out two loans: a 30-year loan of 300k with 4% interest and a 10-year loan of 100k with 6% interest. For the first payment, I want to make an extra one-time $200 payment towards principle. If my ultimate goal is to save money, should I put that payment towards the 300k loan or the 100k loan? I think conventional wisdom is to put the payment towards the higher-interest loan. However, if you put the extra payment towards the 30-year loan, you are saving a lot on compound interest. Which is the smarter thing to do, and more importantly, why? I ask because I may be in this situation in the future, although I made up the numbers to keep it simple. The answer might change depending on the exact numbers chosen though. edit: I think the answer is different than the answer to the question of which loan to attack first to get debt free in general | ||
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Blitzkrieg0
United States8838 Posts
What can be more interesting is when you have a smaller loan with lower interest. It won't save you money to pay it off first, but the psychological aspect of making progress or cash flow can make it a better decision. | ||
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micronesia
United States23986 Posts
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LegalLord
United Kingdom13413 Posts
On January 17 2022 07:21 micronesia wrote: I think conventional wisdom is to put the payment towards the higher-interest loan. However, if you put the extra payment towards the 30-year loan, you are saving a lot on compound interest. Which is the smarter thing to do, and more importantly, why? The conventional answer is the correct answer. The payment duration isn't a fundamental property of the interest rate per se - it's just what happens when you set your payment to the exact value needed so that the loan, plus all accumulated interest, is retired exactly at the end of that duration. It doesn't matter how long the loan is notionally supposed to be in duration because loan duration for a given principal and interest rate is going to be given by what payments you made. What you really have to keep in mind is that in loan A, the interest rate means that every dollar you borrowed will add 4% interest per year on top of the outstanding principal, whereas for loan B every dollar will add 6% per year. So if you reduce the B loan's principal by $200, that's going to have a larger effect in reducing your principal. So, as the conventional wisdom says, you would be best off paying more on B. | ||
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Vivax
Austria17934 Posts
For your question you'd subtract 200 from each loan, recalculate it with the same method and look at the difference. First you calculate the interest factor q: (1+(interest%/100))^years Then you do: Loan amount * q It's an equation for calculating the returns on an investment. In this case your loan is the banks investment. That is, on yearly interest payments. | ||
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micronesia
United States23986 Posts
On January 17 2022 08:05 Blitzkrieg0 wrote: Paying the higher interest loan will always save you the most money. Not paying interest 30 years from now at 4% is worthless compared to paying less at 6% today. This is just basic time value of money. When I thought about this I realized you don't derive any realized benefit until the final month of the loan (assuming you don't sell the house/etc early). An extra early payment will either reduce the size of the final payment (by an amount greater than the extra payment) or will allow the loan to end in an earlier month entirely. In my example, attacking the smaller but higher interest rate loan will derive a benefit in a much earlier year (more valuable) than attacking the larger loan with an extra up-front payment. The part where I'm struggling is to determine if time value necessarily overwhelms any other competing benefits. I'll show a bit of math further down. On January 17 2022 08:30 LegalLord wrote: This all made perfect sense to me but I chose to define the loan by duration rather than monthly payment amount. You could of course define it using either number and the other would be calculated for you up front.The conventional answer is the correct answer. The payment duration isn't a fundamental property of the interest rate per se - it's just what happens when you set your payment to the exact value needed so that the loan, plus all accumulated interest, is retired exactly at the end of that duration. It doesn't matter how long the loan is notionally supposed to be in duration because loan duration for a given principal and interest rate is going to be given by what payments you made. What you really have to keep in mind is that in loan A, the interest rate means that every dollar you borrowed will add 4% interest per year on top of the outstanding principal, whereas for loan B every dollar will add 6% per year. So if you reduce the B loan's principal by $200, that's going to have a larger effect in reducing your principal. So, as the conventional wisdom says, you would be best off paying more on B. Isn't there a competing effect where the larger loan's interest is going to compound for much longer, though (if we disregard time value of money for now)? On January 17 2022 08:32 Vivax wrote: Played around a bit using euler. For the 100k loan I got a result of 179084 bucks. The 79084 would be what the bank got from your interest payment after 10 years if I didn't screw up the calculation. For your question you'd subtract 200 from each loan, recalculate it with the same method and look at the difference. First you calculate the interest factor q: (1+(interest%/100))^years Then you do: Loan amount * q It's an equation for calculating the returns on an investment. In this case your loan is the banks investment. That is, on yearly interest payments. For comparison, here is my math: If I pay off the 300k loan normally, I pay 215,607 in interest by the end. If I cut the principle by 200 at the beginning, I pay 215,465 in interest. By injecting 200 at the beginning, I saved 142 over the life of the loan. If I pay off the 100k loan normally, I pay 33,224 in interest by the end. If I cut the principle by 200 at the beginning, I pay 33,158 in interest. By injecting 200 at the beginning, I saved 66 over the life of the loan. This is the calculator I was using: https://www.bankrate.com/calculators/home-equity/additional-mortgage-payment-calculator.aspx (I kept "additional principle payment" 0 for this experiment). My math doesn't take into account inflation, time value of money, or strategies to make extra payments beyond the first month. Is my math wrong somehow? It seems to show that, everything else being equal, you are better off pumping a bit of extra $$ into the 300k loan if your sole goal is to reduce total interest paid across all loans. | ||
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Vivax
Austria17934 Posts
So no, I don't think that the math was wrong. What loans do is steal money from the future, but that's just my opinion. | ||
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