OT: Stock and Investment Talk
- Thread starter RU-05
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Been climbing a 13-week Treasury ladder, with one maturing every four weeks. Now nearing the point where longer durations are getting attractive. 6-month, 1-year, 2-year.
If you were my age, I would call this wussy. But since you are retired, I guess this is okay. :)
Started a new CURE play today and added to LABU. Health care is ready to rip soon.
Health care will do well once the rates have stabilized and in an environment where rates continue to stay high.
I wouldn’t be surprised to see 6% 6 months later this year. Just brought some 5.2% 1 year CD.
Don't hold your breath for that pivot. “Peak Fed” is now at a 5-handle. While TIPS break-evens have moved up, the gap between the terminal rate and inflation expectations continues to grow. Real rates are going up again.
Just a big disconnect in the market. RFR and credit spread doesn’t equal to reality. Too many people are looking for a “safer” return. Saw a BB pfd at low 6% yield sold out in 5 secs.
Hypothetical:
If you had $50k that you didn't need for a few years... would you put it in treasuries getting 5% (no state income tax), S&P 500 fund, or Money Market getting 3.5%?
the correct answer is probably a blend of the 3, but just curious
If you had $50k that you didn't need for a few years... would you put it in treasuries getting 5% (no state income tax), S&P 500 fund, or Money Market getting 3.5%?
the correct answer is probably a blend of the 3, but just curious
They got this wrong! SI's exposure to FTX wasn't the issue, it was the run on the bank that did them in (i.e., the panic because of FTX).Did you write this? They mention emotional selling in their report :)
It's all about context: your age, income, liabilities, assets, capital purchase plans and timelines, portfolio and asset allocation, and more.
Check out this site to explore things. They also have pre-packaged content per their guidelines for many scenarios. https://www.bogleheads.org/forum/viewforum.php?f=1&sid=c65765d3afc5732deac04b3f2a07dc76
Age is irrelevant once he said he doesn't need the money for a few years. Time horizon rules the day.
Silicon Valley Bank (SVB) down huge today. -35%. Investment bank has a ton of exposure to Tech. Been the biggest in that space for a while.
I know that site well, spend a bunch of time over there... i know the answer i'd get from them! which is why i asked it here.
Tech or crypto-like tech? BTC and ETH are holding up pretty well as of now. SI going under was talked about for a few months. I guess JP Morgan wasn't part of those Reddit threads! LOL.
Venture/tech. I'm sure they have some crypto exposure but its nothing like Silvergate.
They did a lot of tech venture lending and tech ipo's. Recently they've been holding a lot of securities. They dumped a huge piece of the portfolio for a $2b loss and also raised $2B. Market didn't like it.
Their clients are mostly tech start ups so their deposits are getting hit hard too.
Def not money market. If you can get to 5.5% on a 2 yr treasury I’d do 30% treasury and 70% stocks. I say 5.5% because it think that’s the terminal rate for 2 yr and I think the market will bottom at that point so it would be a good point to go mainly all in with an allocation like that.
I’m reminded of this quote:Did you write this? They mention emotional selling in their report :)
There are two kinds of investors, be they large or small: those who don't know where the market is headed and those who don't know what they don't know. Then again, there is a third type of investor: the investment professional, who indeed knows he doesn't know, but whose livelihood depends upon appearing to know.
William J. Bernstein
Brillant! :)
Beware of those who call themselves "experts".
I have money in my money market at 4.2% waiting for a drop in the S&P to 3,600 and other treasuries maturing shortly waiting for 5.2-5.5% non callable 5 year treasuries. Presently hold Fangs stocks, dividend stocks at 52 week low and health care stocks at 52 week low . Many expect a quick pivot in interest rates but I don’t see it unless there’s a recession. If there’s a big drop in the market then 70-75% in the market otherwise 40% in market and rest in treasuries.
"The company said late Wednesday that it plans to sell $1.25 billion worth of common stock, which represents 7.9% of the company's market capitalization of $15.8 billion as of Wednesday's close, and $500 million worth of mandatory convertible preferred stock. SVB said it has entered into an agreement with equity investor General Atlantic to buy $500 million of common stock in a separate private transaction. Separately, SVB said it completed the sale of substantially all of its securities portfolio available for sale, with the $21 billion of securities sold resulting in a loss of approximately $1.8 billion in the first quarter of 2023."
They also lowered their outlook.
Down 70% from it's lat 2021 highs. Covid lows around $127, currently at $160.
Just curious = why do 5.5% on 2-year if you can get 4.5% MM? Perhaps I’m overvaluing liquidity or just viewing the MM as a short term place to hideout.
1% advantage plus no state tax due on the Treasury note. And that MM rate will most likely fall next year vs the Treasury which is a lock.
A lot of people questioning why they didn't write down their bond portfolio as well.
That's a good question for a lot of banks.
I’ve never owned a treasury. Do most folks hold until maturity? Do you take a hit (other than missing out on interest) if you sell before maturity?
Buy at auction. Hold to maturity. You can sell (or buy) on secondary market, if needed
The stock and investment thread has turned into the treasury purchase thread.
