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> USA Stock Discussion v8, Brexit: What happens now?

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ChAOoz
post Apr 7 2022, 09:02 AM

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QUOTE(Davidtcf @ Apr 7 2022, 08:55 AM)
Fed need to keep remind people and confirm that there will be 6 times interest rate hikes left.

That will keep the market in reality check rather than keep up down = false optimism.
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Not just rate hikes to neutral but also QT and plus slowing corporate earnings due to reduce consumption and higher production prices.

Everyone is seeing whether the fed can tame inflation without pushing the economy into a recession. Not an easy task
Lon3Rang3r00
post Apr 7 2022, 09:05 AM

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QUOTE(kmmsa @ Apr 7 2022, 08:01 AM)
cibai fed open mouth so soon  ranting.gif  havent May yet
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Sigh, entered at the wrong time for me as well. Now can't even DCA as cash not ready. let's hope it continue to down more then until May. Give us more opportunity to buy the dip.
Ramjade
post Apr 7 2022, 09:37 AM

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QUOTE(Lon3Rang3r00 @ Apr 7 2022, 09:05 AM)
Sigh, entered at the wrong time for me as well. Now can't even DCA as cash not ready. let's hope it continue to down more then until May. Give us more opportunity to buy the dip.
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I need it to continue until end of this month. That's when additional cash will come.
Davidtcf
post Apr 7 2022, 09:49 AM

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QUOTE(ChAOoz @ Apr 7 2022, 09:02 AM)
Not just rate hikes to neutral but also QT and plus slowing corporate earnings due to reduce consumption and higher production prices.

Everyone is seeing whether the fed can tame inflation without pushing the economy into a recession. Not an easy task
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likely recession already soon with such high interest rates.. 6 times interest rate hike is no joke. Will result in companies will try cut cost since bank loan expensive.

This also means more people losing jobs or getting pay cut. That will end up in less money to spend by the people + less growth = recession.

This post has been edited by Davidtcf: Apr 7 2022, 09:50 AM
Ramjade
post Apr 7 2022, 10:02 AM

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QUOTE(Davidtcf @ Apr 7 2022, 09:49 AM)
likely recession already soon with such high interest rates.. 6 times interest rate hike is no joke. Will result in companies will try cut cost since bank loan expensive.

This also means more people losing jobs or getting pay cut. That will end up in less money to spend by the people + less growth  = recession.
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That's what happen if you print money so much.
Toku
post Apr 7 2022, 10:06 AM

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QUOTE(Lon3Rang3r00 @ Apr 7 2022, 09:05 AM)
Sigh, entered at the wrong time for me as well. Now can't even DCA as cash not ready. let's hope it continue to down more then until May. Give us more opportunity to buy the dip.
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Why the hurry? Are you not afraid of getting in at the peak? From a longer horizon, the market is barely off its peak now.
RiriRuruRara
post Apr 7 2022, 01:56 PM

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Hi sifu's, wta do your think twitter be one of those stocks that shoot up a ridiculous amount in a short time like, AMC and GME?
Hoping not to miss another one of these movements things....
Davidtcf
post Apr 7 2022, 02:24 PM

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QUOTE(RiriRuruRara @ Apr 7 2022, 01:56 PM)
Hi sifu's, wta do your think twitter be one of those stocks that shoot up a ridiculous amount in a short time like, AMC and GME?
Hoping not to miss another one of these movements things....
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not sure if can sustain high price.. if you bought it before Elon Musk announcement then would have earned a lot.. right now if buy hard to say. Depends what the future of Twitter looks like.
danmooncake
post Apr 8 2022, 01:45 AM

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QUOTE(Davidtcf @ Apr 7 2022, 09:49 AM)
likely recession already soon with such high interest rates.. 6 times interest rate hike is no joke. Will result in companies will try cut cost since bank loan expensive.

This also means more people losing jobs or getting pay cut. That will end up in less money to spend by the people + less growth  = recession.
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I don't think the multiple rate increases will trigger the recession at this time. Historically, the rate still very low. The demand for goods and services are very high in US and the employment rate is pretty good. Best is if US Fed can get it back to 3~4% to balance it out to taper down the high inflation and the expensive stocks PEs - this will be better.

Most of the big companies already locked in their low rates to operate for the next 24-36 months. They may just fund their operations from their cash vault. Over the years, most of them got huge cash reserves from their huge profits.

Appetite for growth stocks may slow down, value stocks may start to be looking attractive again.


jon0000 P
post Apr 8 2022, 08:47 AM

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QUOTE(Davidtcf @ Apr 6 2022, 11:29 AM)
Irish domiciled ETFs per trade will cost around USD1+ too. But long term will earn on dividends since it is 15% witholding tax rather than 30% for US etfs.
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Can buy ire domiciled etf on ibkr?
dwRK
post Apr 8 2022, 09:49 AM

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QUOTE(danmooncake @ Apr 8 2022, 01:45 AM)
I don't think the multiple rate increases will trigger the recession at this time. Historically, the rate still very low.  The demand for goods and services are very high in US and the employment rate is pretty good. Best is if US Fed can get it back to 3~4% to balance it out to taper down the high inflation and the expensive stocks PEs - this will be better.

Most of the big companies already locked in their low rates to operate for the next 24-36 months.  They may just fund their operations from their cash vault. Over the years, most of them got huge cash reserves from their huge profits.

Appetite for growth stocks may slow down, value stocks may start to be looking attractive again.
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Yeah... needs a big enough trigger meltdown...

covid n ukraine couldn't do it... dunno what next...

This post has been edited by dwRK: Apr 8 2022, 09:50 AM
Ramjade
post Apr 8 2022, 09:50 AM

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QUOTE(jon0000 @ Apr 8 2022, 08:47 AM)
Can buy ire domiciled etf on ibkr?
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Of course. Just activate trading permission for LSE.

QUOTE(dwRK @ Apr 8 2022, 09:49 AM)
Yeah... needs a big enough trigger for panic selling and capitulation...

covid n ukraine couldn't do it... dunno what next...
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Let's wait and see if interest rate at 6% will do the trick. Covid did the trick but stupid fed went and pump so much money into the system it halted the crash. It was spectacular as basically everyday open, kena circuit breaker.

This post has been edited by Ramjade: Apr 8 2022, 09:52 AM
dwRK
post Apr 8 2022, 09:50 AM

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QUOTE(jon0000 @ Apr 8 2022, 08:47 AM)
Can buy ire domiciled etf on ibkr?
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yes
dwRK
post Apr 8 2022, 09:55 AM

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QUOTE(Ramjade @ Apr 8 2022, 09:50 AM)
Let's wait and see if interest rate at 6% will do the trick.
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i expect market to push ath one more time... but anyways let's take it one week at a time...
Ramjade
post Apr 8 2022, 09:57 AM

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QUOTE(dwRK @ Apr 8 2022, 09:55 AM)
i expect market to push ath one more time... but anyways let's take it one week at a time...
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Now it's Tina. But if interest rate at 6%, I dont think Tina is anymore into effect.
Lon3Rang3r00
post Apr 8 2022, 11:34 AM

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This post has been edited by Lon3Rang3r00: Apr 8 2022, 11:35 AM
SUSxander83
post Apr 8 2022, 04:32 PM

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QUOTE(danmooncake @ Apr 8 2022, 01:45 AM)
I don't think the multiple rate increases will trigger the recession at this time. Historically, the rate still very low.  The demand for goods and services are very high in US and the employment rate is pretty good. Best is if US Fed can get it back to 3~4% to balance it out to taper down the high inflation and the expensive stocks PEs - this will be better.

Most of the big companies already locked in their low rates to operate for the next 24-36 months.  They may just fund their operations from their cash vault. Over the years, most of them got huge cash reserves from their huge profits.

Appetite for growth stocks may slow down, value stocks may start to be looking attractive again.
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In fact those cash hoarders will start deploying it to use now rclxms.gif

Recession unlikely but stagflation for at least a year or more is the most likely scenario


RiriRuruRara
post Apr 8 2022, 06:12 PM

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Starbucks can buy now or can get cheaper?😃
Moneylust
post Apr 8 2022, 06:16 PM

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Bro,

How much capital did you deploy to make that making usd400-450/week just by selling options?

And the options of which companies did you sell, other than Starbucks?


QUOTE(Ramjade @ Apr 5 2022, 04:25 PM)
Actually no. Maximum you lose is the amount you paid for 1 contract. That's it. Nothing more or nothing less.

Buying 1 contract = 100 shares but = lesser value than buying 100 shares outirght. Don't believe me go and do a simple Google of buying saying say 100 Tesla shares Vs buying 1 deep in the money call options for Tesla. See the difference?

If the options is deep in the money, you can exercise the options you bought or 100 shares. Those 100 shares is worth something provided the company is still around. biggrin.gif
As long as any options is deep in the money it will auto exercise upon expiry date.

You will lose money only if the company goes to zero. Buying 1 contract will make you lose less money Vs buying 100 shares outright if the company goes to zero.

But if your are selling naked calls the risk can be a lot if you domt have the collateral to back it up.

I am talking about buying deep in the money calls here.

Another strategy you can follow is chicken genius strategy. Sell at the money put 1 month out. On expiry date, just buy back the put to close it. But he only does it on Tesla.

If you know what you are doing with options, it's next best thing since sliced bread. I have been making usd400-450/week just by selling options. Not much but better than nothing. The USD400-450/week really help to refill my money chest faster than my salary or dividends. That's why I don't do dividend investing anymore. In fact this week those USD400-450/week paid for my 10 shares of Starbucks aka I am getting 10 free shares of Starbucks biggrin.gif
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This post has been edited by Moneylust: Apr 8 2022, 06:17 PM
Ramjade
post Apr 8 2022, 08:04 PM

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QUOTE(Moneylust @ Apr 8 2022, 06:16 PM)
Bro,

How much capital did you deploy to make that making usd400-450/week just by selling options?

And the options of which companies did you sell, other than Starbucks?
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Depends on your stock. You can do it alone with one stock like Tesla or you can use multiple combo.

I used multiple combos like upstart, crwd , home depot, Nvidia, amd, tsmc, Airbnb. Capital needed around usd100k which if conservative gives you around 20%p.a. Good enough for me.

First rule of selling puts is you need to be comfortable buying 100 shares at the strike price you choose.Like I am comfortable picking up Airbnb in 135-140 range so if it's near that price, I just sell covered put on it easily netting me usd40-80/contract.

Another one is amd, I am ok with picking up another 100 shares at Usd98, hence that's my strike price.

For covered calls is a different story. You want to try to hold on to your stock. For stuff like crwd I set my premium to usd30x4x/week.For tsmc, I set t to usd2x/week. Every stock is different. If you have been selling covered call for a while you will know where is the safe and sweet spot where you can sell and the options expired worthless. The further you go out, the less liquid it gets and premium may become not worth it.

If you don't have capital for it, focus on one company say amd, or palantir. Dont tell me you can afford 100 shares of palantir? 100 shares of palantir, can easily give you usd10/week.

If you don't have the capital or refuse to use margin, another way you can do is do a poor man covered call. Buy a deep in the money call options expiring say 2 years old. Then start selling calls on it. The capital for deep in the money call is lesser than capital required to buy 100 shares.

Another reason is I use interactive broker and uses margin. As long as your stock does not hit the strike price for puts, and your cash balance remains positive, no interest will be charged

Even if it hits, as mentioned I am happy buying at those price and if my cash do turn negative, interactive broker have very low margin rate like 1.5%p.a so my interest is like USD400-1000/year which is easily cancel off by consistently selling calls (1 week of selling options easily wipe out one year worth of interest) Hence subsequent premium from selling options goes to paying down the principal). Of course the more negative your portfolio, the longer you have to sell options just to wipe out the interest. Above is just an example.

Of course with interest rate going up, I will reduced the amount of covered put I opened going forward.

This post has been edited by Ramjade: Apr 8 2022, 09:30 PM

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