**OFFICIAL** Trading and Investing Thread: Part XVI -- BAG HOLDING EDITION

[RobParks2M]

Shorting seems difficult af, would make for an exciting ride and good story but feels like there are much easier and less stressful ways to make money

I would never short. If I want downside exposure just buy puts. Always go short dated puts never really gonna win on long term puts as most things, like the market as a whole, tend to go up long term.

[Destor]

Shorting is one of the dumbest things one can do, history and statistics are not in your favor, when the most famous and profitable short seller in history commits suicide when market moved against him in a big way, you know that it’s probably not the best strategy.

The big short guy was wrong so many times, but one time he was right they made a movie about him,

Also, I don’t know if many people realize he was down over $1 billion for a couple years, how many people have the balls and the resources to keep covering and keep holding?

Bulls always win in the end. Shorts lose even when they are right lol, because they need to also be right at the right time!

It does make for a good story though. Then you follow Michael Burry for a while and he spends like three years making wrong predictions, tweeting them, and deleting / remaking his Twitter account.

Nobody talks about all the losses, but the huge win becomes a movie.

I would never short. If I want downside exposure just buy puts. Always go short dated puts never really gonna win on long term puts as most things, like the market as a whole, tend to go up long term.

Same here. I like to be pessimistic about things just to stay grounded in reality, but pessimism doesn’t mean taking short positions. I would also never short.

[GeneralSerpant]

What Soun beat earnings.

[BuckNakedinBama]

Shorting seems difficult af, would make for an exciting ride and good story but feels like there are much easier and less stressful ways to make money

Risky, interesting move.

What makes you confident a correction is imminent?

Simply: charts. History. Fundamentals. Society. Rates. Jobs.

Long response:

Charts - look at the 5 10 and 20 year nasdaq charts. Looks like a double top to me. P/E for nasdaq is around 22. No way that keeps up even with booming growth expected.

History/rates - look at history of what happens when rate cycle stops tightening, stalls, and starts loosening. Market always goes down right after where we are right now.

Fundamentals - again, nasdaq at 22P/E. All the real growth and stock increases are with the mega-cap stocks. The economy is not good, standard of living is down, and productivity isn't making good progress.

Society - see above. Also election coming up will breed uncertainty and strife.

Jobs - all the jobs are **** low-level service jobs, and even those "gains" are starting to peter out as the service jobs that were created by reopening from covid are now filled. Where is there going to be job growth?

I see us going back to 5% unemployment with 1-2% GDP growth and 3% inflation. That puts the fed in a super tight spot and essentially creates a "new normal" which is stagflation. Once the markets catch on to these macro pictures I think the P/E ratios fall back from the stratosphere.

[HMFIC_BROWSIN]

Pull up a BROS weekly chart right now and look at this week's bull volume.

This is the beginning of a sustained and strong rally. I'm deploying all of my cash into it today.

Very reminiscent of the high volume weekly bullish candle we saw on COIN back in July 2023.

[stockbruh]

You don’t wanna be holding bitcoin ETFs, they are stealing money from you in fees and other tricks, after all these *******s have to get paid, zooming out a bit, you can see from the chart that you would make a lot more money just holding spot bitcoin.

there are really only two, some argue three good bitcoin proxies, first obvious one is microstrategy, which is a basically a call option on bitcoin so it’s double leverage kinda, another one is cleanspark, which is the best miner. Some people would say that riot is another good miner though I don’t have enough technical expertise to agree or disagree with that.

I keep hearing this but I believe the fee is only .095 percent on BITO which I’m guessing means when you cash out they take 1 percent?they’ve paid out an average of 1$ dividend each month this year so far, I’m holding 400 shares, through the dividend and selling ITM covered calls I’ve paid for almost half my shares already, they’ve forecasted for a dividend every single month this year but that depends on how Bitcoin does.if you can find me another stock that’s paying a 20 percent dividend every month and is only down 5$ from all time highs let me know

[NestBrah]

Simply: charts. History. Fundamentals. Society. Rates. Jobs.

Long response:

Charts - look at the 5 10 and 20 year nasdaq charts. Looks like a double top to me. P/E for nasdaq is around 22. No way that keeps up even with booming growth expected.

History/rates - look at history of what happens when rate cycle stops tightening, stalls, and starts loosening. Market always goes down right after where we are right now.

Fundamentals - again, nasdaq at 22P/E. All the real growth and stock increases are with the mega-cap stocks. The economy is not good, standard of living is down, and productivity isn't making good progress.

Society - see above. Also election coming up will breed uncertainty and strife.

Jobs - all the jobs are **** low-level service jobs, and even those "gains" are starting to peter out as the service jobs that were created by reopening from covid are now filled. Where is there going to be job growth?

I see us going back to 5% unemployment with 1-2% GDP growth and 3% inflation. That puts the fed in a super tight spot and essentially creates a "new normal" which is stagflation. Once the markets catch on to these macro pictures I think the P/E ratios fall back from the stratosphere.

I agree with you on everything except:

History/rates - look at history of what happens when rate cycle stops tightening, stalls, and starts loosening. Market always goes down right after where we are right now.


It feels like the clowns at the Fed are eager to lower rates even with a strong economy that seems to be handling them. In the past rates were only lowered once the economy started falling apart.

This is why I'm hesitant to take any confident position.

If they lower when the economy is still doing okay and people are feeling bullish, asset values are going to skyrocket.

[kusok]

I keep hearing this but I believe the fee is only .095 percent on BITO which I’m guessing means when you cash out they take 1 percent?they’ve paid out an average of 1$ dividend each month this year so far, I’m holding 400 shares, through the dividend and selling ITM covered calls I’ve paid for almost half my shares already, they’ve forecasted for a dividend every single month this year but that depends on how Bitcoin does.if you can find me another stock that’s paying a 20 percent dividend every month and is only down 5$ from all time highs let me know

no, that’s totally cool, but if you look at the two stocks I mentioned, they have done 10 X in the last few weeks, and you can still sell covered calls on those, the premiums are much higher than on any ETF, as an example, a few weeks ago Out of money covered call on micro strategy would pay you $20,000 a week, and I believe at that time 100 shares would cost you something like 80 or 90,000 or maybe $100,000, so that’s a pretty crazy premium,

What I also like about those two bitcoin proxies is that micro strategy should be a very easy double from here in the next few weeks, it all depends on the cycle obviously, and clean spark should realistically be hitting 60 or $70, so that’s like a 3x or 4x from here,

Basically, one of the general rules of investing is that growth always beats dividends, every single time, you would only use dividends in very few very specific cases, such as if you are retiring in the next year or two or you desperately need cash flow right now today, stuff like that, generally this is because anyone who pays dividend it just means they have no idea how to grow their business, they don’t know how to reinvest the money to grow,

[kusok]

It does make for a good story though. Then you follow Michael Burry for a while and he spends like three years making wrong predictions, tweeting them, and deleting / remaking his Twitter account.

Nobody talks about all the losses, but the huge win becomes a movie.



Same here. I like to be pessimistic about things just to stay grounded in reality, but pessimism doesn’t mean taking short positions. I would also never short.

If someone has inside information from CEO of NVDA that they’re gonna have a really bad next year, I totally understand shorting, but if you just watch the news or read something on yahoo finance and then decide to sell or short the market, you’re just getting played, Because people who put out these articles and bad news are the same people who can create the sell off in the market and those are the very same people who are going to buy what you’re selling… I think most sellers just don’t realize that, when they sell their stock, somebody’s buying it, And then you can always go back and check who did the buying and it’s always the same people who put out the bad news articles to get you to sell.

[SipNPiz]

Simply: charts. History. Fundamentals. Society. Rates. Jobs.

Long response:

Charts - look at the 5 10 and 20 year nasdaq charts. Looks like a double top to me. P/E for nasdaq is around 22. No way that keeps up even with booming growth expected.

History/rates - look at history of what happens when rate cycle stops tightening, stalls, and starts loosening. Market always goes down right after where we are right now.

Fundamentals - again, nasdaq at 22P/E. All the real growth and stock increases are with the mega-cap stocks. The economy is not good, standard of living is down, and productivity isn't making good progress.

Society - see above. Also election coming up will breed uncertainty and strife.

Jobs - all the jobs are **** low-level service jobs, and even those "gains" are starting to peter out as the service jobs that were created by reopening from covid are now filled. Where is there going to be job growth?

I see us going back to 5% unemployment with 1-2% GDP growth and 3% inflation. That puts the fed in a super tight spot and essentially creates a "new normal" which is stagflation. Once the markets catch on to these macro pictures I think the P/E ratios fall back from the stratosphere.

Pretty much all retailers are saying the same thing, newest was ikea, nobody can afford anything, Starbucks, dollar tree, McDonald’s all too expensive now. Definitely headed to low economic activity with high inflation aka stagflation. That’s why I got back into gold I think the next pop will be to 2550 maybe 2600

[_zman]

If someone has inside information from CEO of NVDA that they’re gonna have a really bad next year, I totally understand shorting, but if you just watch the news or read something on yahoo finance and then decide to sell or short the market, you’re just getting played, Because people who put out these articles and bad news are the same people who can create the sell off in the market and those are the very same people who are going to buy what you’re selling… I think most sellers just don’t realize that, when they sell their stock, somebody’s buying it, And then you can always go back and check who did the buying and it’s always the same people who put out the bad news articles to get you to sell.

It's going to become even easier with AI helping to create the fear mongering articles and disinformation too. Then the algorithms play us all. I'm worried...

[usersignup2]

Just sold my last holdings - MU and MSFT. And loaded up on SQQQ. Time for a correction.

JMHO using macro as an entry for SQQQ, which is a short term vehicle, can get you rekt. good luck.

[Abzu]

Looks like SOFI bout to hit the deck again, will probably bounce around $6.75 but it's going lower, currently targeting $5.xx

Pull up a BROS weekly chart right now and look at this week's bull volume.

This is the beginning of a sustained and strong rally. I'm deploying all of my cash into it today.

Very reminiscent of the high volume weekly bullish candle we saw on COIN back in July 2023.

This is interesting and I wil comment further after I look deeper into it.

[stockbruh]

no, that’s totally cool, but if you look at the two stocks I mentioned, they have done 10 X in the last few weeks, and you can still sell covered calls on those, the premiums are much higher than on any ETF, as an example, a few weeks ago Out of money covered call on micro strategy would pay you $20,000 a week, and I believe at that time 100 shares would cost you something like 80 or 90,000 or maybe $100,000, so that’s a pretty crazy premium,

What I also like about those two bitcoin proxies is that micro strategy should be a very easy double from here in the next few weeks, it all depends on the cycle obviously, and clean spark should realistically be hitting 60 or $70, so that’s like a 3x or 4x from here,

Basically, one of the general rules of investing is that growth always beats dividends, every single time, you would only use dividends in very few very specific cases, such as if you are retiring in the next year or two or you desperately need cash flow right now today, stuff like that, generally this is because anyone who pays dividend it just means they have no idea how to grow their business, they don’t know how to reinvest the money to grow,

BITO does not pay out a typical dividend, it pays out whatever surplus they get from rolling their futures contracts out, from what I understand they have to pay out the dividend or get hit with insane taxes on their profits. I can’t afford micro strategy I’m working with a 50k portfolio with 75 percent of it in PLTR. I’m also not a 100 percent believer in Bitcoin so I’m hesitant to throw my money into an all in stock that’s based on Bitcoin, just wanted a little exposure and so far it’s working out well for me

[Abzu]

no, that’s totally cool, but if you look at the two stocks I mentioned, they have done 10 X in the last few weeks, and you can still sell covered calls on those, the premiums are much higher than on any ETF, as an example, a few weeks ago Out of money covered call on micro strategy would pay you $20,000 a week, and I believe at that time 100 shares would cost you something like 80 or 90,000 or maybe $100,000, so that’s a pretty crazy premium,

What I also like about those two bitcoin proxies is that micro strategy should be a very easy double from here in the next few weeks, it all depends on the cycle obviously, and clean spark should realistically be hitting 60 or $70, so that’s like a 3x or 4x from here,

Basically, one of the general rules of investing is that growth always beats dividends, every single time, you would only use dividends in very few very specific cases, such as if you are retiring in the next year or two or you desperately need cash flow right now today, stuff like that, generally this is because anyone who pays dividend it just means they have no idea how to grow their business, they don’t know how to reinvest the money to grow,

I don't have a regular job so I use dividend payers to fund my lifestyle and ensure that it doesn't change lol I boost my returns by buying long calls in growth stocks.

I like to borrow against my accounts when I want to make big purchases so I need to have the stability to avoid a margin call, I can't borrow against FB and have it go to $80 lol, I might find it difficult to cover.

Instead of buying stock on say google, I buy 2 year calls and collect more money than holding 100 shares, I take the money that I saved buying calls as opposed to stock and put it into a stock that pays a dividend above 5% then I sell calls on it. Google has been running in 2-3 year cycles anyway. Google hit a low at the end 2008 and hit the high by the end of 2009(30% down after high) then didn't go higher until 2012, it hit the next high in early 2014(20% down after that high) and didn't break it until late 2015, it hit the next high in 2018(25% down) didn;t go higher until 2020(35% down).

[Abzu]

If someone has inside information from CEO of NVDA that they’re gonna have a really bad next year, I totally understand shorting, but if you just watch the news or read something on yahoo finance and then decide to sell or short the market, you’re just getting played, Because people who put out these articles and bad news are the same people who can create the sell off in the market and those are the very same people who are going to buy what you’re selling… I think most sellers just don’t realize that, when they sell their stock, somebody’s buying it, And then you can always go back and check who did the buying and it’s always the same people who put out the bad news articles to get you to sell.

Imagine borrowing against a $1,000 stock that could easily go under $500 lol the greatest players generally play the best defensive game.

[SipNPiz]

Bought VCSA surely all the bad news is priced in at this point and they’re trading at a huge discount to book price, tons of layoffs announced today too

[NestBrah]

Imagine borrowing against a $1,000 stock that could easily go under $500 lol the greatest players generally play the best defensive game.

Abzu give us your forecasts for the S&P 500 over the next 6 - 12 months.