Companies will not easily let go of workers unless it is absolutely necessary. Covid taught them a good lessons. It's not easy to rehire.
OT: Stock and Investment Talk
- Thread starter RU-05
- Start date
Just wait for the Apple iCar! :)Interesting chart. Just how much higher can it really go tbh? I along with most people already think the VR thing is way overpriced. I don't even think the market would be that big for them if it was lower.
Also banking services can be big. When you have such a loyal and captive customer base, you can do almost anything.
Question (and also for @RU-05 ). Been reading a little about options in my free time. LOL! If folks are bullish on PSNY and RIVN, would it be a good play to buy calls with a long expiration date (say Jan 2025) at a reasonable strike price/premium and bet that it blows up in that time? Or does this become a time decay issue?
Obviously, I see that you both sell a lot of calls for the premium/income, so I guess that is the flip side of the coin. :)
I'm no expert, but my 2 cents.
Decay is a concern, but looking that far out it's not a concern in the short to intermediate term. If the stock price stays put for a couple months, the options won't decay much.
So looking out I see you can buy the Jan 25th $15 PSNY calls for .30 cents, which for one contract(100 stocks) is $30. You are risking very little.
Now if PSNY goes on a run in the next couple months, from it's current price of $5, up to let's say, for the sake of the example, $20, that call is going to be worth over $5(because you have the right to buy the stocks for $15). This is where my lack of knowledge is evident, because I'm sure there is a formula to get a better estimate, but let's say the calls are, again for the sake of argument, then worth $6 per contract or $600. The stock price went up 4x, but the calls went up 20x.
So absolutely more potential for a homerun in the options, but again, there is the decay factor, and unlike stocks, a very high potential that those options contracts to go eventually to zero. The options will also decline much more rapidly if the stock price declines as well, and I think that is the bigger concern when looking at options.
RIVN's currently trading at a tick under $25, I'm seeing it's $25 Jan 2025 options now selling for about $9.50. If the stock tanks back down to $14 by Aug, that $25 strike could be worth somewhere around $1(the one more time sake of argument example). Stock price cut in half, options contract cut by 90%.
Consider the recent respective moves of each. RIVN has ripped, and because of that the options contracts have REALLY ripped, while PSNY is still near it's all time lows. PSNY is relatively cheap on a price to rev's 3.5x vs 10x, even though expected rev growth looks similar. Could be due for a coat tails catch up trade.
I'm tempted to dabble here on PSNY.
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Just comparing PSNY and RIVN in terms of an investment, from an on the street perspective, I'm seeing more and more RIVN's, where as, with Polestar I saw a few early on(my buddy has one), I'm not seeing seeing them much at all anymore.
I also think the truck factor is important, RIVN is the leading EV truck maker currently. Maybe they get squeezed eventually once Ford and GM get up to snuff, but in the mean time they are carving out a market. And as noted AMZN is a built in customer.
PSNY I believe is a Volvo/chinese collaboration, which I guess is good and bad.
I also think the truck factor is important, RIVN is the leading EV truck maker currently. Maybe they get squeezed eventually once Ford and GM get up to snuff, but in the mean time they are carving out a market. And as noted AMZN is a built in customer.
PSNY I believe is a Volvo/chinese collaboration, which I guess is good and bad.
6 month chart looks like it cleared a double top resistance level at $4. Agree, def looks like this looks ready for a catch up. 30ish% off it's lows, so potential for catching the move early.
As I note above I like the story better for RIVN, but just looking at Polestar's #'s, it's cheaper, growth rate has been, and is expected to be excellent. I have some money after selling some losers, so I think I might give it a go.
The VR thing also suffers from the same issue the occulus does, no one really wants to walk around in public wearing these monster goggles.Interesting chart. Just how much higher can it really go tbh? I along with most people already think the VR thing is way overpriced. I don't even think the market would be that big for them if it was lower.
I think the Occulus is cool as heck to be in, but my GF heckles me to no end if I think about going putting it on.
Yes Apple allows you to look out into the real world while wearing them, but it's still weirdoverse.
I think there are cool potential applications, but I really wonder about every day usage.
PSNY is projected to sell about the same # of EVs as RIVN in 2023, but has a $9b market cap compared to $24b. Polestar is getting into the US, but is definitely more of a EU/Asia play.
Don't get me wrong, I love RIVN's products and I believe it will be a huge winner in the EV market. However, that doesn't mean PSNY can't win as well.
If you are inexperienced with options than I am a newborn baby! LOL! When you say "options will decline" do you mean other similar options on the market? I believe once you buy a specific contract, the terms are set and don't change, right?
Ya, the strike price, and the date are set. How much people are willing to pay for that specific contract will fluctuate. When I say decline above, I mean the price of the options contract going down because the stock price went down, not because of time decay, which will happen even if the stock price stays the same.
For instance, Rivn current stock price of $25. The August 4th option contract with a $30 strike, currently selling for $1.13. Two weeks from now, if RIVN is still at $25, that contract will have declined, not because of the stock price going down, but because of time decay.
This is evident if you look out over time, where the further you go out, Aug vs Sept vs Oct, the higher the premium(contract price) will be for the same strike price.
If you are really interested I say just throw the ole hat in the ring. Start small obviously, learn the ropes, and then go from there.
Interesting stuff. Since I sold half my TQQQ position, I'm sitting on a lot of cash in my fun account. I'm DCA'ing into my 2 custom baskets (EV and FS Insights), but have plenty of resources for additional plays. In the meanwhile, Fidelity's money market fund is paying out 4.75%, but they cash is burning a hole in my pocket! :)
Like I said, you can thrown $30 at those PSNY options. It doesn't require much to dabble.
I often sell weekly's, so those are typically small amounts. 1% of a position is what I often look for in premium, though I'm learning I should shoot for less premium but a higher strike. That way if a stock runs, like PLTR and AI did, I capture more upside. Each were good trades, but could have been better, especially AI which just blew past the strike.
Likely a good idea. PSNY just seems so undervalued. Do you ever buy calls instead of selling? I wouldn't like having a position that is ripping be yanked away!
I have. Not too often though. Made money on RIG. Lost money on CS. Those are the only two i can remeber at the moment.
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MSN
www.msn.com
Saudi's cutting their production is providing a nice oppurtunity for US companies. Produce more oil, while prices remain relatively high thanks to OPEC's cuts.
"OPEC and its allies have announced cuts this year amounting to ~6% of 2022's production, but Rystad Energy estimates output in countries outside OPEC is making up for about two-thirds of the reductions, and crude prices have slid 13% YTD.
Half of the new crude is coming from the U.S., where several companies including ConocoPhillips (COP), Devon Energy (DVN), EOG Resources (NYSE:EOG) and Pioneer Natural Resources (PXD) delivered strong Q1 production."
I do own DVN, with it's 5x P/E and 9.5% div.
Oil companies on FS Insights stock list:
XOM
MPC
PSX
VLO
DVN
OXY
They believe H2 will be good for the energy sector.
Watch RIG (not RIGS, edited the above post), off short oil rigging company, just broke past a potential double top to set a 4+ year high. Higher beta play. A farmer Jim favorite. Still cleaning up it's balance. Currently $7.70, and I'd say $10 looks easily attainable. Probably some stiff resistance there though.
Just looking at DVN, but it's down for the year, and the month, looks like it bounced off a support level.
XOM's chart looks similar, just bouncing off support.
After a great 2022 oil was due for some give back this year, after a down first half, it might be due for a good 2nd half.
I'm not sure if this is the correct thread for this question, but rather than start a new one, I will post here. My friend is interested in doing some investing in the market via an IRA or a product like that. He is retired and in his late 60's. A college buddy of his, who did not go to business school, suggested allocation his investments as follows:
- 30% in the S&P 500 index fund
- 25% in Mid cap
- 15% in Small cap and Small cap Value
- 10% in Healthcare
- 10% in Real Estate
- 10% in Emerging Markets
100% of his stock allocation into the Total stock market index fund
A few things, as per my opinion.....way to much with Mid & Small caps. Too high on EM. Definitely no on Real Estate. My thoughts:
25% S&P 500 Index = VOO
15% Large Cap Growth = VUG
10% Large Cap Value = VTV
10% Mid Cap Index = VO
10% Small Cap Index = VB
10% Expanded Tech = IGM or QQQ
10% International Developed Markets = VEA
5% Emerging Markets = EEM
5% Healthcare = VHT
Something like this would do the trick! Diversified and balanced. :)
Seeing as how this group is a largely anonymous bunch of people on the internet, I too do not understand the financial brainpower of the group. 🙂
I would think there are a bunch more things a financial advisor would want to know before offering your friend any financial advice. For starters:
1. How much money does he want to invest and for how long?
2. His investment goals (e.g. growth to bequeath next generation, additional income now)?
3. Does he want track the investment daily and adjust or just plunk down money and forget about it?
4. Does he have emergency cash fund of roughly 1 year's retirement income (not being invested)?
I often see people give advice based on their own situation rather than the situation of the advisee - which is pretty stupid (on both the giving and receiving ends). Gotta know way more about the advisee.
A balanced portfolio is paramount given the age of this retiree. I'd point him to: https://www.bogleheads.org/forum/viewforum.php?f=1&sid=234bba7366d1d804cd14aebcc9afd47f
Google Option Greeks and you will get a better understanding of the factors that determine price and movements.
100% equities for a retiree is crazy. 50% to 70% equities is an acceptable range. Fixed income is essential. You need to understand the context here: a retiree (hopefully) is in wealth preservation mode, perhaps with a secondary focus on income (the old 4% rule is something to consider) as well as leaving $ for family, charities, etc.
This is very helpful advice, even though people have differing opinions, the comments raise important questions, which I believe will lead to better path forward for his investing. I will Google Option Greeks - never heard of that term.
I also told him to consider the impact of AI over the next two or three years (that's my area of research). For example, could we be facing 20% or more unemployment due to automation? That's not far-fetched to me, as someone who believes that AI will replace more jobs than it adds. That would certainly affect his investment portfolio.
In the interest of sharing back, I attended a Rutgers alumni webinar that has hosted by two former RU profs. They have a nice list of resources on their website if you, or someone you know, is going to be retiring. I shared the link with my friend, and here is the link if anyone is interested (the list is more focused on retirement resources rather than investing).
https://www.makeretirementwork.net/about-1
I'll be facing this situation in a few years, so I'll be coming back to this group if the thread is still going!
I also told him to consider the impact of AI over the next two or three years (that's my area of research). For example, could we be facing 20% or more unemployment due to automation? That's not far-fetched to me, as someone who believes that AI will replace more jobs than it adds. That would certainly affect his investment portfolio.
In the interest of sharing back, I attended a Rutgers alumni webinar that has hosted by two former RU profs. They have a nice list of resources on their website if you, or someone you know, is going to be retiring. I shared the link with my friend, and here is the link if anyone is interested (the list is more focused on retirement resources rather than investing).
https://www.makeretirementwork.net/about-1
I'll be facing this situation in a few years, so I'll be coming back to this group if the thread is still going!
I assumed when he said “investments” he meant that cash and fixed was already covered, especially given his example portfolio.
He should have some exposure to long and short term bond funds, as well as investments in CD’s. You can get CD rates in the 5% range, and treasury bond funds will do well if the economy weakens and rates come down. With that said, there are a lot of factors to consider as everyone’s situation is different. I retired last year and younger than your friend. When I retired last year I was in sound financial footing, and the only thing that could jeopardize my retirement was a large dip (+40% drop in the market); so I positioned my portfolio conservatively as I have no interest in going back to work full time. My heavy bond purchases recently now puts me about 30% stocks, 25% bonds and 45% cash (and the cash is earning in the 4-5% range. I also have decent exposure to residential real estate in a resort area that has faired extremely well. Investments in real estate that includes office space would be risky
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If the person in question doesn't need the money or any additional income, and it kind of sounds like he doesn't, and if he has kids who won't need it for a while, then he could just dump it all into a low-cost S&P 500 index fund and forget about it entirely. Or go even riskier with a tech fund. Because he doesn't need it and the kids can wait out a market downturn if he passes away during a down market. No need to temper risk with bonds (which haven't been so great recently anyway).
If he's willing to pay daily attention, he could let the funds sit in a money market (some pay decently high right now, like a CD or better), and then wait for down weeks on the market and then buy small batches of a low cost S&P500 or tech ETF, instead of a mutual fund, near closing on Fridays. Basically do a bit of attentive DCA to get the funds funded over a period of time (not sure how this tends to work out versus dumping the whole thing in).
If he's willing to pay daily attention, he could let the funds sit in a money market (some pay decently high right now, like a CD or better), and then wait for down weeks on the market and then buy small batches of a low cost S&P500 or tech ETF, instead of a mutual fund, near closing on Fridays. Basically do a bit of attentive DCA to get the funds funded over a period of time (not sure how this tends to work out versus dumping the whole thing in).
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For retirees, Treasuries have been terrific of late. Buy direct at auction via your brokerage account/s. 1-year, 2, 3, 5, 7, 10-year. Anywhere from 5% to 4%. Hold to maturity. No state or local taxes. Adding 5-year and 10-year TIPS to hedge against inflation. Solid for retirees.
https://www.treasurydirect.gov/auctions/
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Given the information provided, I too would be inclined to go with index funds for the equity portion. Total Stock wouldn’t be bad in my view. By the way, he can’t contribute to an “…IRA or similar product” unless he has earned income (not pension, SS, dividends, capital gains, etc.) Also, just for clarification an Individual Retirement Arrangement (I.e., IRA) is not a product, it is an account type. Good luck to him and happy retirement!
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I have I-bonds (which no longer look like a very good investment at current rates). But I haven't the first idea how to buy a treasury at auction. Guess I'll read up on them at the link.
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You just submit your purchase order on TreasuryDirect (there’s a list of auctions by maturity). When the auction happens you know what price and yield you got and they’ll settle the transaction with whatever bank account you provide.
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