Market has been selling off slowly from the highs of the day. Sell the news? Of which there was really none....as expected.
OT: Stock and Investment Talk
- Thread starter RU-05
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Powell has done a good job (so far). Sticking to the plan, policy changing but slow and steady. Can't complain!
Freaked out? More like continuing to freak out. My portfolio getting beat up since the start of the speech at 2:30. NASDAQ has dropped 2.3% in 35 minutes
MSFT back below 300. Said there was resistance in that low 300s and I'd sell half there. If it gets back down to the 285 or hopefully lower (which I think is very possible) level where I bought the other half I may buy that back again.
AMZN I said 2900 is where I bought because it's a bottom of a trading range and that has been resistance now. Next order I have is at 2500 and the 2400-2500 area I think has some support. After that 2000 area.
AMZN I said 2900 is where I bought because it's a bottom of a trading range and that has been resistance now. Next order I have is at 2500 and the 2400-2500 area I think has some support. After that 2000 area.
Sell the news?
Or did the market not get what it wanted? IE a March rate hike, but not full blown hawkish.
Seems like they are staying on their track of denying the obvious.
Good point! Some people are still emotional and freaking out for no reason. Slowly raising rates to 1.0 to 1.5%? Oh the humanity. Last I checked, that is still historically low and bullish for equities.
I don't think the he said anything market moving...the sentiment is still seems negative for now IMO and so that now that he's made his comments and answered some questions the market sells. I wouldn't even say there's a real reason per se with any of his comments but just waiting for the event to happen.
The news today is much better than many were expecting and already baked into the market.
AMZN at $2000. LOL! If that happens, I will take out a mortgage on our house to raise more cash to invest.
People talk about pre pandemic levels for some stocks. A prepandemic level for AMZN puts you in that area. Always talk about about a lot of pull forward because of the pandemic for AMZN. It is oversold currently on a medium term basis. A drop to that level would be 46% off the highs. It went parabolic for a period after the pandemic, if you suck that back out that's where you end up. Is that likely to happen. I tend to think no but like I tell you often it doesn't matter to me. If a stock goes up I'm good, if it goes down I'm good as long it's levels I'm comfortable buying or selling it at.
Just some thoughts.
Pull fwd for AMZN would be more for adoption, or yoy growth, unlike say PTON which would be sales.
AMZN's rev's doubled 2019 to 2021, and are expected to grow another 15% into 2022.
I think the concerns for AMZN are much like the concerns for FDX and that is cost of labor, and that was at least partly reflected in the 3q eps miss.
I was just checking my account and noticed this article I thought some would find interesting. Since I feel like I started to TQQQ conversation I felt obligated. Sorry it is long, but it is a good read.
The record volatility of 2020 has been accompanied by a higher than usual number of exchange-traded product (ETP) closures, especially among leveraged and inverse products. According to data from FactSet, 91 ETPs were closed in Q1, including over 30 which promised either leveraged or inverse exposure to an index. At Schwab, we continue to believe that leveraged and inverse ETPs are not suitable for most investors. However, if you were holding one of these products when it closed, or are still holding one that was delisted, you might be wondering if you’ll get your money back. Well, it depends.
ETNs are more complicated to shutter, and the closure process will depend heavily on what was written into the note’s prospectus when it was first issued. One way to close an ETN is to call the note and return its value to investors minus fees. This is known as “accelerated redemption.” Accelerated redemptions can be either elective or mandatory. Elective redemptions occur when the note’s issuer chooses to call the note before its scheduled termination. Mandatory redemptions occur when the note triggers a condition that was predetermined by its prospectus, such as the value of the note declining below a specified threshold.
However, some ETNs have no provisions in their prospectuses to allow for accelerated redemption. In this case, the ETN is simply delisted from its national exchange, and investors are forced to either wait for the note’s scheduled maturity (which could be decades away) or try trading it in the over-the-counter market, generally at a big discount.
If you need to find information about an ETF or ETN that has announced its closure, a good place to begin is the issuer’s website. Most issuers do a good job of describing the closing process and providing key dates on either the product page or in the news/announcements section.
Due to potential confusion about leveraged and inverse exchange-traded funds’ performance objectives, the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) issued a joint warning in 2009 about the risks of these products for buy-and-hold investors—including the possibility of big losses.
Displaying remarkable prescience, the joint alert contained another important warning that might have been overlooked at the time, but seems especially relevant today: “There is always a risk that not every leveraged or inverse ETF will meet its stated objective on any given trading day…”
Since most leveraged and inverse products gain exposure to the underlying index through specialized derivatives contracts that are negotiated with large banks or other financial institutions—known as "total return swaps"—they rely on the existence of a counterparty who will take on the other side of the trade, for a fee. In some market conditions, the cost of obtaining exposure via swaps may increase beyond what the manager is willing or able to pay; the manager will then be forced to either reduce the leverage ratio or close the product.
Research has shown that when the ETP promises a large absolute leverage factor (i.e., -2x or +3x) or tracks a highly volatile index, leveraged and inverse ETPs are at higher risk of not providing their promised level of exposure.
Some observers are worried that leveraged and inverse ETPs may pose risks to the entire financial system—or at least to the markets in which they operate. While it is possible (although rare) for a leveraged or inverse ETP to influence prices in the underlying assets of the index it tracks, we’ve also seen issuers respond to market conditions and higher swap costs by taking the following actions:
As a result, one-directional pressure on the prices of the underlying assets is reduced. Knowing that markets are in control of leveraged and inverse ETPs, rather than the other way around, should provide some comfort to the worried observers.
And, as with all investments, it is important to read the prospectus and fully understand the product’s investment objectives, investment strategies, risks, and costs.
The record volatility of 2020 has been accompanied by a higher than usual number of exchange-traded product (ETP) closures, especially among leveraged and inverse products. According to data from FactSet, 91 ETPs were closed in Q1, including over 30 which promised either leveraged or inverse exposure to an index. At Schwab, we continue to believe that leveraged and inverse ETPs are not suitable for most investors. However, if you were holding one of these products when it closed, or are still holding one that was delisted, you might be wondering if you’ll get your money back. Well, it depends.
Terms & definitions
Let’s first review the terminology. ETP is the blanket term which covers both exchange-traded funds (ETFs) and exchange-traded notes (ETNs). Although these products have similar sounding names, they're actually quite different. An ETF is an entity that owns a basket of securities, such as stocks, bonds, or commodities. ETFs are legally separate from the companies that manage them. They're typically structured as "investment companies," "limited partnerships," or "trusts." ETNs are not independent pools of securities. Instead, an ETN is an unsecured note issued by a financial institution, which promises to pay ETN holders the return on some index (or multiple of that index) over a certain period of time. There are also differences when these two types of products close.Closings
The process for closing an ETF is fairly straightforward. The ETF’s manager will announce a date at which the fund will no longer accept creation orders (in other words, no new shares of the ETF will be issued). Next, the fund will be delisted from its exchange (halting secondary market trading), and the manager will begin the process of liquidating the fund’s assets. Finally, cash is distributed to shareholders, usually within a week of delisting. Of course, investors who find themselves holding an ETF that has announced its forthcoming closure can always sell their shares before the delisting date, instead of waiting for the final distribution.ETNs are more complicated to shutter, and the closure process will depend heavily on what was written into the note’s prospectus when it was first issued. One way to close an ETN is to call the note and return its value to investors minus fees. This is known as “accelerated redemption.” Accelerated redemptions can be either elective or mandatory. Elective redemptions occur when the note’s issuer chooses to call the note before its scheduled termination. Mandatory redemptions occur when the note triggers a condition that was predetermined by its prospectus, such as the value of the note declining below a specified threshold.
However, some ETNs have no provisions in their prospectuses to allow for accelerated redemption. In this case, the ETN is simply delisted from its national exchange, and investors are forced to either wait for the note’s scheduled maturity (which could be decades away) or try trading it in the over-the-counter market, generally at a big discount.
If you need to find information about an ETF or ETN that has announced its closure, a good place to begin is the issuer’s website. Most issuers do a good job of describing the closing process and providing key dates on either the product page or in the news/announcements section.
Fair warning
Nevertheless, investors should keep in mind that it’s not uncommon for leveraged and inverse ETPs to close as a result of losing nearly all of their assets. For example, ProShares UltraPro 3x Crude Oil ETF (OILU) closed on March 27, 2020, with a net asset value of $0.21 after beginning the month of March with a NAV of $9.29. Likewise, UBS ETRACS Mthly Py 2xLvg Mortg REIT ETN (MORL) closed on March 18, 2020, with an indicative value of $0.11. For investors who purchased the note on March 4, 2020, at $13.63—this represented a 99% loss.*Due to potential confusion about leveraged and inverse exchange-traded funds’ performance objectives, the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) issued a joint warning in 2009 about the risks of these products for buy-and-hold investors—including the possibility of big losses.
Displaying remarkable prescience, the joint alert contained another important warning that might have been overlooked at the time, but seems especially relevant today: “There is always a risk that not every leveraged or inverse ETF will meet its stated objective on any given trading day…”
Since most leveraged and inverse products gain exposure to the underlying index through specialized derivatives contracts that are negotiated with large banks or other financial institutions—known as "total return swaps"—they rely on the existence of a counterparty who will take on the other side of the trade, for a fee. In some market conditions, the cost of obtaining exposure via swaps may increase beyond what the manager is willing or able to pay; the manager will then be forced to either reduce the leverage ratio or close the product.
Research has shown that when the ETP promises a large absolute leverage factor (i.e., -2x or +3x) or tracks a highly volatile index, leveraged and inverse ETPs are at higher risk of not providing their promised level of exposure.
Some observers are worried that leveraged and inverse ETPs may pose risks to the entire financial system—or at least to the markets in which they operate. While it is possible (although rare) for a leveraged or inverse ETP to influence prices in the underlying assets of the index it tracks, we’ve also seen issuers respond to market conditions and higher swap costs by taking the following actions:
- Closing the ETP (or temporarily suspending creations)
- Decreasing the leverage factor
- Changing or modifying the index tracked by the ETP
As a result, one-directional pressure on the prices of the underlying assets is reduced. Knowing that markets are in control of leveraged and inverse ETPs, rather than the other way around, should provide some comfort to the worried observers.
Bottom line
Investors in leveraged and inverse ETPs may find that there isn’t much to recover when their leveraged or inverse product closes. However, if there is value remaining in the investment, investors should first confirm whether the product is an ETF or an ETN and then check the issuer’s website for important dates and details. ETN investors should be prepared to act quickly if the note is being delisted without accelerated redemption, since trading the ETN on the national exchange before its delisting date may offer a better experience than trading over-the-counter.And, as with all investments, it is important to read the prospectus and fully understand the product’s investment objectives, investment strategies, risks, and costs.
Idiot CEO started rambling on senselessly about whether they do a split or spin and used a bunch of confusing words like “value leakage”. Instead of applauding what was a solid quarter the moron went off the reservation discussing potential capital structures.
Snap continues to dump. Watching it closely. Monster growth in recent years which is expected to continue. Finally turned profitable this year. Current P/Es look ridiculous but if expectations are hit, it's a 24ishx in 2023.
Total falling knife right now, but tempted to start a position.
Total falling knife right now, but tempted to start a position.
Anyone have thoughts on best way to approach ROTH IRA. I’ve tried some growth plays ala Peter Thiel but hasn’t worked out great LOL. Then, I’ve been thinking about adding some high dividend stocks like BGS and just let them DRIP. Thoughts?
Nice double beat for TSLA!
www.cnbc.com
Tesla beats on earnings and revenue, says supply chain issues were 'main limiting factor'
The automaker said supply issues will likely persist in 2022, even as income jumped more than 700% in the fourth quarter.
Getting big dividends is a good play for Roth IRAs due to the non-taxed feature. It's also a good vehicle for any swing for the fences plays for the same reason. If you hit on a 10x plus play, just think of the tax savings.
Good to note, I certainly did not consider that these things could just "close".
However the closings they note were from 2020. And more specifically the Covid dip. Oil went negative for a bit there. So pretty rare circumstances.
Still, and I was considering this, if I'm looking for beta should I go a leveraged ETF or just a high beta stock? Well that's a mark against the leveraged ETF.
And they've avoided those supply chain constraints, while the likes of F and GM have struggled mightily, thus far.
+1
Record earnings and performance for TSLA, even with those SC issues. Stock should go up, up, up.
Let’s see where it lands tomorrow. Will be interesting to hear how competition impacted the quarter. I’m assuming an analyst will ask.
I am $40,000 in on my way to purchasing $200,000 of index funds on one account and $20,000 on the way to purchasing $100,000 in a 529
So I will be buying weekly for the next few years. Give or take 40 months
So I will be buying weekly for the next few years. Give or take 40 months
I've seen you mention BGS before. I have core positions in consumer staples like the KOs, PEPs, PGs, KMBs, etc...of the world
A lot of them I wouldn't look to now because many are near highs. But KMB just reported this morning and went down and today traded down as low to as 19% off its highs. It's divy yield is about 3.44%. I think they said input costs and supply chain issues affected them. I'd want it lower but it's one I'm keeping an eye on if it does go lower.
CLX also go downgraded to underperform by CS citing pandemic benefits fading. It's 32% off the inflated pandemic highs. I'd expect they may be facing similar issues to KMB. It's divy yield is 2.82% I'd want this lower as well but another one I'm keeping an eye one if it goes lower.
Neither are as high yield as BGS but in the same staples sector and not near the highs like many others.
I bought BGS today around $30 figuring with the 6% divy and support around $28 I felt it could serve me well. I may add more on dips. I also bought Citibank the other day mainly for the dividend and hope it plays catch up to JPM. Anyone have other good dividend ideas?
Due to the recent dip, you may want to speed up or adjust the next purchase or two.
In my opinion you fill Roth IRAs with what you feel will give you the best total return. Tax efficiency isn’t an issue so dividends and high turnover funds are fine. Having said that, I don’t include any dividend funds in my Roth because in general and over the long haul, they typically return less than growth funds. I am not a big fan of large positions in individual stock in Roth because you don’t get that space back (except from conversions and back door). So to me, I keep individual stocks (18% of my portfolio) in a taxable account. Of course, selecting a few individual stocks that you feel have great potential is fine, but to me, it’d be a smaller portion of the Roth. I think a good actively managed fund (e.g., Vanguard Primecap Admiral) is fine, as are equity index funds (e.g., Vanguard S&P Index or Total Stock). I have all of the aforementioned in my Roth.
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Good point on managed funds. You need non-taxed accounts to deal with cap gains and distributions.
SBLK.
Over the last 3 qtr's it has paid out $2 on a $20 stock price.
That dividend has increased from .30 to .70 to 1.25. But do note it did not pay a regular dividend prior to these 3 qtrs.
Stock has been in a range since May. Currently at the lower end of that range.
Dry bulk shipping. Pretty sure this one benefits from the shipping back log, so does that dividend dissappear once they clear out the back log? Probably but still could make some dividend money in the mean time.
A wild car dividend play.
Buy SCHD and forget about it until you need to take withdrawals. 3 percent yield that continues to grow and good price appreciation.
I increased my purchases by 20% going from $5000 to $6000 a month. I am making the investments from current income not from other savings so I really do not want to go much higher.
I am putting cash away to pay for new windows also
Growth stocks and volatility go together. You don't get one without the other. If your horizon is long-term (5+ years), you will hardly remember this dip.
^^^^^ Truth
Tech stocks are more and more integrated into everyday life. The biggest 7 S&P 500 stocks are all tech for a reason.
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