StreetsofBeige
Gold Member
Good call.
I remember seeing this bottom out around $10. Didnt know it rebounded to $16.
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Stock-Age: Stocks, Options and Dividends oh my!
- Thread starter koam
- Start date
I remember seeing this bottom out around $10. Didnt know it rebounded to $16.
GHG
Member
Been watching the order book since the open and there's been a LOT of retail participation, that's been increasing since the start of the year.
When the market is rallying hard but the VIX and VXN are refusing to fall (or are also rising in tandem) then its a bad sign, lots of hedging activity going on in the background. To make matters worse the dollar is also up today.
I'm not jumping into anything personally. The recent moves have been irrational and considering the way big tech has guided along with Jerome Powell's comments the other day I'm starting to think there's something bigger at play in the background. Someone wants or needs these markets to remain propped up for a while, I'm starting to wonder if it's geopolitical in nature.
All of the macro data under the hood along with the fundamentals still continue to get worse.
Raven117
Member
Yup. This feels like a true up bear trap. The dumb money is going to push it a bit higher, but the smart money right now is already looking for the exit to take the rip. Nothing is supporting this rally other than...some folks wanted a rally...and the Fed only raised a quarter point.
We know that companies are missing projections...labor market is still very tight...Fed isn't dropping any time soon to keep the lid on all this.
I totally agree with you GHG.
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GHG
Member
Just going to leave this here as an example of what's going on in the background:
This is also my only regret but if I had done I'd be offloading right about now. Their ER wasn't even good either.
Edit: it's also important to note that this can go on longer than many think. Anyone looking to purchase puts as a short position or in order to hedge make sure you buy yourself time, I'm talking Q3/Q4 of this year if necessary.
The next FMOC isn't until March, there's a possibility we continue to edge higher until then unless the next CPI reading comes in hot (Feb 14th).
Timing the exact top will be impossible but all of the risk is heavily skewed to the downside right now.
This is also my only regret but if I had done I'd be offloading right about now. Their ER wasn't even good either.
Edit: it's also important to note that this can go on longer than many think. Anyone looking to purchase puts as a short position or in order to hedge make sure you buy yourself time, I'm talking Q3/Q4 of this year if necessary.
The next FMOC isn't until March, there's a possibility we continue to edge higher until then unless the next CPI reading comes in hot (Feb 14th).
Timing the exact top will be impossible but all of the risk is heavily skewed to the downside right now.
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Fools idol
Banned
GHG
Member
I wouldn't be so sure. There's still a lot of liquidity on the sidelines. It will take time to flush it out.
https://www.cnbc.com/2023/01/18/inv...cash-and-may-be-poised-to-snap-up-stocks.html
Fools idol
Banned
For new investors, especially if you are young, the following strategy is a lot more favourable than pure index funding.
1. Pay off all debts excluding mortgage (assuming your rate is pretty low)
2. Secure a 6-12 month 100% cash emergency fund to safeguard yourself and your family from any income tragedy that may render you unable to remain invested.
3. Dollar cost average into 10-15 dividend growth stocks (at least some of these should be from the Dividend Aristocrats and / or Dividend Kings lists.
4. Continually add to your positions evenly with new cash each month and when the dividends come in, use them to buy more shares of the higher yielding stocks.
5. Wait, and enjoy your life on this earth.
This method is fool proof and guaranteed you $1m retirement at the very least, if you are consistent with deposits and don't panic during downturns, your snowball of ever growing dividends will make you disgustingly rich very quickly. I have a friend in the marines who has been following this strategy on a $36k a year and he's almost at the point where his dividends cover 100% of his living costs 7 years in. By the time he is out of the marines he will be financially free.
1. Pay off all debts excluding mortgage (assuming your rate is pretty low)
2. Secure a 6-12 month 100% cash emergency fund to safeguard yourself and your family from any income tragedy that may render you unable to remain invested.
3. Dollar cost average into 10-15 dividend growth stocks (at least some of these should be from the Dividend Aristocrats and / or Dividend Kings lists.
4. Continually add to your positions evenly with new cash each month and when the dividends come in, use them to buy more shares of the higher yielding stocks.
5. Wait, and enjoy your life on this earth.
This method is fool proof and guaranteed you $1m retirement at the very least, if you are consistent with deposits and don't panic during downturns, your snowball of ever growing dividends will make you disgustingly rich very quickly. I have a friend in the marines who has been following this strategy on a $36k a year and he's almost at the point where his dividends cover 100% of his living costs 7 years in. By the time he is out of the marines he will be financially free.
GHG
Member
Yep dividend snowballing is powerful.
If people don't want to pick individual names for this strategy then the likes of JEPI and SPHD will do the job.
HoodWinked
Member
weird divergence between qqq and 2yr yield. Usually they mirror but they're both up now.
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crazepharmacist
Member
Dividend investing is a farce. You pay more in taxes. The stock price goes down proportionately when dividends are paid out. Higher yield means higher risk and less growth.
Just invest in VOO. The yield is 1.6% which is high enough. 10 year average annual return is almost 12%.
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HoodWinked
Member
nice infographic for some megacaps
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This sounds amazing. Is there a ELI5 post on how to achieve this?
Cyberpunkd
Member
Yes, have enough money to put $1k per month into this scheme.
Fools idol
Banned
the compound effect works just as well with $100 a month than $1k a month, albeit slower!
I do. Currently about to hit my target for saving for my 6 months emergency funds. I'm also investing in real state but I want to branch out to stocks. I put some play money in crypto but it's not really my thing. I prefer something more traditional
AJUMP23
Parody of actual AJUMP23
Right now I would pick MS with the integration of ChatGTP into their browser and the AI competency seems like a good way to go.
midasmulligan
Member
yep, been rocking with Dividend Growth Investor for several years now, no joke the best way to secure a retirement. It's a sleepy strategy, so doesn't get the hype train behind it, but the real way to build wealth and a passive income for the patient. There's a couple of way to tighten up the strat (don't overpay, don't fall into yield trap, etc), but is the only way i invest now.
https://www.dividendgrowthinvestor.com/
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midasmulligan
Member
incorrect, you don't pay on divs in Roth in US. Additionally, div tax lower than cap gains tax and income tax. Can keep divy payers in tax free account and growth holdings in taxable account.
Fools idol
Banned
we dont pay div tax in ISA accounts here in the UK either. I haven't and wont pay a penny tax on my investments for the next 50 years
crazepharmacist
Member
While true, I’m just saying it’s not a good idea to chase dividend yield. I would rather invest in a company with no dividend as that means they are investing all of their profits back into the company. A company with a dividend means they literally don’t know what to do with that money so they just give it back to investors because there’s no other use for it. I would also prefer them to do buybacks instead of dividend because of the tax implications.
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Ellery
Member
Any good plays for today? Maybe forex or something
I feel like being active with a bit of spare money outside of my long term investment portfolio.
Fools idol
Banned
I made probably 5 trades in the last year so I'm not one to ask for short term plays lol
Grildon Tundy
Member
Market keeps going down. I'm still putting money in each month, trying to think of it as "buying for cheap", but, man, a little bit of earnings would be cool, right?
Raven117
Member
I just want to quote myself (and GHG) for accuracy.
chromhound
Member
Thank you $jfbr
StreetsofBeige
Gold Member
SVB Silicon Valley Bank just dropped from about $270 to $110 on bad numbers and needing to issue more shares. It actually hit $100 flat at one point.
Never herd of them but they have to do with finance tech start ups. And with interest rates rising and their bonds losing value, they had to dump a bunch of securities for a major loss valued more than their market cap.
Crazy shit.
Never herd of them but they have to do with finance tech start ups. And with interest rates rising and their bonds losing value, they had to dump a bunch of securities for a major loss valued more than their market cap.
Crazy shit.
Fools idol
Banned
SVB could be a Lehman moment. Very bad situation out there.
Silverbank, credit suisse, deutcshe bank also in trouble. Splash damage all over....
I am stil short ES Futures as a hedge.
Only US longs I have are $NET and $S.
Silverbank, credit suisse, deutcshe bank also in trouble. Splash damage all over....
I am stil short ES Futures as a hedge.
Only US longs I have are $NET and $S.
HoodWinked
Member
blood bath
Joshmyersbv
Member
With SVB going under everyone is expected shit to really hit the fan on Monday. Why is that?
Fools idol
Banned
bank failures cause huge ripples. Laege investors from other banks suddenly start to panic about exposure and all want to get their money out at the same time, causing bank runs. More often than not, banks do not hold sufficient funds to cover huge withdrawals and that is just how the cookie crumbles.
Not only that but it also just causes general panic. They start dumping all liquid assets (stocks etc) without discrimination which in turn causes huge volatility, and stop losses get triggered further causing chaos.
The last time this happened was Lehman Brothers bank in 2008, and we all know what happened next.
also this is hilarious:
I'm starting to think this was no coincidence at all.
also this:
hold on to your butts.
Joshmyersbv
Member
I thought there were rules in place to prevent Executives from selling large amounts of shares at once. I guess not lol.
Fools idol
Banned
ahahahahha, dont make me laugh right
it's one rule for them, one rule for us. SEC is quite a joke these days.
There is so much corruption at the market infrastructure level that a service like Unusual Whales can help you piggyback on insider trading. Says it all, really. I set up an account using their premium alerts and put 10k into it for fun more than anything, and blindly followed the 'unusual' activity trades. The account had win after win consecutively, I was up something like 500% in about 6 weeks at one point.
at one point las weeks, a company called Stratasys, ticker SSYS, a trader out of nowhere purchased 12 million dollars worth of short dated calls.I followed the trade but with a small amount cause I figured, fuck, someone must know something is up. a few days passed, nothing. Then right before the expiry, boom, news that a buyout offer was in for .$18 a share. the stock moved 25% in a single day. I just wish I had put in more. The guy who put in $12m must have made a fortune.
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GHG
Member
If everyone expects something it usually doesn't transpire that way. So Monday is most likely not the day.
That said, this could be be the first domino of many to fall. I will use every green day to increase my short exposure.
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Joshmyersbv
Member
Jesus, I just thought that after what happened in 2008 that they would have safeguards in place to prevent it from happening again. I mean in this kind of economy a top 20 bank shouldn't go under in 48 hours.ahahahahha, dont make me laugh right
it's one rule for them, one rule for us. SEC is quite a joke these days.
There is so much corruption at the market infrastructure level that a service like Unusual Whales can help you piggyback on insider trading. Says it all, really. I set up an account using their premium alerts and put 10k into it for fun more than anything, and blindly followed the 'unusual' activity trades. The account had win after win consecutively, I was up something like 500% in about 6 weeks at one point.
Raven117
Member
SVB isn’t exactly LB. It’s closer to Washington Mutual.
That said, while it’s going to be choppy for a bit, I think this mostly stays contained. SVB was basically a tech bank. As we know, tech has been getting crushed (by design…. That whole industry for a decade has been super frothy). Stands to reason a bank will follow.
This is what the fed wants. And it’s going to be a bloody day when the market realizes that and Powell continues to raise rates. He isn’t kidding about this.
That said, while it’s going to be choppy for a bit, I think this mostly stays contained. SVB was basically a tech bank. As we know, tech has been getting crushed (by design…. That whole industry for a decade has been super frothy). Stands to reason a bank will follow.
This is what the fed wants. And it’s going to be a bloody day when the market realizes that and Powell continues to raise rates. He isn’t kidding about this.
StreetsofBeige
Gold Member
US gov bailing out deposits?
finance.yahoo.com
U.S. government guarantees all Silicon Valley Bank deposits, money available Monday
Silicon Valley Bank depositors will be made whole and have access to their money starting Monday morning, according to a statement from the Treasury, Fed, and FDIC on Sunday.
finance.yahoo.com
Raven117
Member
I mean, not really.
They are just guaranteeing the deposits, but taking control of the assets of the bank to realize them at a later time (and use some of the insurance the bank's pay into for stuff like this).
HoodWinked
Member
Futures were big green but ended slightly less green but still up. All of that gets wiped out and markets opens red... Now back to even. While crypto is up 15%
This is just completely impossible to predict.
This is just completely impossible to predict.
Raven117
Member
Crypto being up boggles my mind.
I know GS came out saying that they don't think the Fed will increase rates, but I think they will. I think inflation reports come in hot this week...and even with SVB failing...I think the Fed stays the course.
Fools idol
Banned
If we assume that the Fed is backstopping a facility which gives banks full collateral credit for unrealized losses due to rate hikes, the Fed is basically saying that this whole QT hiking cycle will reverse and all bonds will eventually trade back to par. I am trying to figure out what Powell's long term plan is here because, I think, It means if the borrowers default they will just hold the collateral to maturity.
I don't think were out of the woods yet. Credit default swaps are getting out of control. I have never in my life seen 15 bank stocks drop 75% in a single day, not even 2008.
Absolutley wild how the index is still green today. Let us not forget the old chestnut that is 'the first market reaction is always the wrong one' lol.
The next few weeks will be critically important for the united states financial system. I don't think people quite realise how perilous the situation is right now.
If Powell doesn't stay the course and goes full on printing clown car the dollar will be worth nothing in a few years time. The US will literally be Venezuela 2.0
I don't think were out of the woods yet. Credit default swaps are getting out of control. I have never in my life seen 15 bank stocks drop 75% in a single day, not even 2008.
Absolutley wild how the index is still green today. Let us not forget the old chestnut that is 'the first market reaction is always the wrong one' lol.
The next few weeks will be critically important for the united states financial system. I don't think people quite realise how perilous the situation is right now.
If Powell doesn't stay the course and goes full on printing clown car the dollar will be worth nothing in a few years time. The US will literally be Venezuela 2.0
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Eddie-Griffin
Banned
Plunger Team.
GHG
Member
Oversold technicals + false hope. What's notable to me is that IWM didn't bounce, it lagged the whole session and finished very much in the red. The common theme since December 2021 has been that IWM has always led the way, both on the way down and on the way up (every time a bear market rally has occurred since then). It lagged the bounces today, something is amiss. I'm seeing some people are saying money flowed into "risk on" assets over the last couple of trading sessions, that's not true. "Risk on" is not defined by crypto and crypto alone. Yes money had flowed into crypto in a big way but something different is at play.
So where do we look? Overall all eyes on DXY from here on out for me personally, it's the only thing that matters, my entire wealth depends on it (which it shouldn't, so I need to change that ASAP). DXY also doesn't lie. The FED really are sleepwalking towards a potential catastrophe here. I hope they have good reason to believe saving a bunch of poorly run regional banks is worth risking the integrity of the dollar over. There's been a clear flight to safety towards gold, silver, and bizarrely, crypto (BTC/ETH) of all things in the last 48 hours.
Let's see what CPI brings in the next 12 hours. One day and one datapoint at a time.
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Fuz
Banned
Honest question, any truth to this?
nypost.com
While Silicon Valley Bank collapsed, top executive pushed ‘woke’ programs
“These banks are badly run because everybody is focused on diversity and all of the woke issues and not concentrating on the one thing they should, which is, shareholder returns,” Marcu…
nypost.com