|
slidebite posted:What's the skinny on indexed GICs? A goddamn waste of time. If you really want an investment with these characteristics, you can build it yourself: a strip bond for the principal amount, and a broad market ETF, or hell, market option contract with the remainder.
|
#
?
Jan 22, 2014 02:26
|
|
|
|
| # ? May 16, 2024 06:55 |
|
|
Thanks for confirming my thoughts.
|
|
#
?
Jan 22, 2014 15:16
|
|
|
CAD/USD getting just hammered today after the Bank of Canada announcement. 0.9056, and dropping. At the moment of announcement:  edit: I don't know about anyone else, but to me, it sure feels like winter is coming. (Not that this would be a reason to make rash portfolio decisions of course). Lexicon fucked around with this message at 16:31 on Jan 22, 2014 |
|
#
?
Jan 22, 2014 16:26
|
|
|
Yeah, I think this was pretty expected for the past couple weeks. Still, as someone that goes across a lot and buys a fair amount online I still grimace at the though of 10% being gone in a relatively short while. What can you do? Hedge it's going lower and buy more US$$ based funds now? The consensus seems to be it'll probably bottom around 88-ish in the coming months, although the last 2 weeks has been an express ride hasn't it. I think the biggest concern (and one I'm definitely addressing) is the exposure to Canadian markets and its upcoming performance. I am heavily weighted on the Canadian side and as I move investment firms I'm taking the opportunity to spread that out. I'll probably be leaning on you folks here for critique and recommendations in the coming while  Speaking of, I know it was mentioned earlier that RBC Direct has the flat $9.95 trade now, but they are also offering 20 free trades on new accounts. http://www.rbcdirectinvesting.com/services/offer/index.html?Offercode=20W17&ProspectID=51CA845E0A634A15AABD9E6F236EAEAB I also discovered when chatting with an RBC branch manager yesterday, you can set up a Direct Investing account at your local RBC branch and they'll handle all the paperwork if you want.
|
|
#
?
Jan 22, 2014 17:47
|
|
|
slidebite posted:I think the biggest concern (and one I'm definitely addressing) is the exposure to Canadian markets and its upcoming performance. I am heavily weighted on the Canadian side and as I move investment firms I'm taking the opportunity to spread that out. I'll probably be leaning on you folks here for critique and recommendations in the coming while The time to buy America was about 18 months ago. There is nothing wrong with diversifying your allocations regionally at any time, though. There are still a few bright spots in the Canadian story, I think - Energy is one of them - this segment is going to benefit from the softer dollar substantially as they tend to incur OPEX in CAD and Revenue in USD, in addition to being strangely undervalued to begin with in comparison to US peers. Something like XEG is what I am looking at personally. The banks will likely also continue to do well. Just an opinion. Do your own due diligence, of course.
|
|
#
?
Jan 23, 2014 01:33
|
|
|
Hindsight is always fantastic in the world of investing. I do agree though that Canada isn't all doom and gloom. I agree that financial sectors should still be strong (my heaviest allocation) but resources will probably start seeing some benefits of the low dollar in the coming months too. That said, I do think I need some more diversification, and not just to the US.
|
|
#
?
Jan 23, 2014 06:19
|
|
|
Saltin posted:The time to buy America was about 18 months ago. America is nearly half of the world if you go by market cap, so if you believe in indexing and diversifying there's never really a bad time to 'buy America'.
|
|
#
?
Jan 23, 2014 06:30
|
|
|
blah_blah posted:America is nearly half of the world if you go by market cap, so if you believe in indexing and diversifying there's never really a bad time to 'buy America'. Ok but I really don't want Florida or Idaho. Is there any way to just buy Massachusetts and Colorado?
|
|
#
?
Jan 23, 2014 06:35
|
|
|
blah_blah posted:America is nearly half of the world if you go by market cap, so if you believe in indexing and diversifying there's never really a bad time to 'buy America'. Yeah I said that. As you likely know what I meant was America had a fantastic year in 2013.
|
|
#
?
Jan 23, 2014 13:18
|
|
|
Saltin posted:Yeah, look, I wasn't writing specifically about the manulife one account, but I agree with you there. What I'm saying is that the premise of the "house as investment" is fundamentally flawed, in my estimation. We don't have to agree about that. Also, while I agree that US and Canada are different with regard to mortgage recourse, they are not different in regard to being affected by economic forces. This is not the place to discuss Canadian real-estate and whether a correction is imminent , but that's why I said what I said. I just want to quote necro this guy because up to this point in the thread there had been some comments re: RRSP and TFSA accounts that I disagree with pretty strongly. There's literally no reason to ever get an RRSP or TFSA account with a retail bank branch when the SDRSP options are available at the (bank-owned or even independent) brokers. The actively managed funds that the retail branches try to funnel you into are there because they're PROFITABLE, not because they're GOOD. Broker accounts have access to all of the mutual funds of a given bank, often the funds of other banks, as well as ETFs / direct stocks / bonds / whatever. As Saltin noted, the iShares series is objectively better than pretty much any sort of mutual fund out there. I have something like 70% of my retirement savings in the XIU. You can even set up the same sort of automated transfers. There's also some math on the RRSP / TFSA trade-off (rather than just broad "if you have a high marginal rate" comments) which you can use to make a decision about what to put where. I haven't seen anyone reference it so far but I'll finish the thread before I post it. I'll see if I can find an online source, otherwise I'll whip up a googledocs spreadsheet.
|
|
#
?
Jan 23, 2014 18:18
|
|
|
^ I'm not seeing anything in your post that's at odds with any general argument that's been advanced in the thread, so I'm not sure what it is that you 'strongly disagree' about.Kalenn Istarion posted:There's literally no reason to ever get an RRSP or TFSA account with a retail bank branch when the SDRSP options are available at the (bank-owned or even independent) brokers. The actively managed funds that the retail branches try to funnel you into are there because they're PROFITABLE, not because they're GOOD. This in particular is completely uncontroversial, except I would allow for e-series as a 'training wheels' option for new, nervous investors or those with very small amounts to invest.
|
|
#
?
Jan 23, 2014 18:25
|
|
|
Eh, earlier in the thread I got the feel that people were suggesting retail branch RRSP accounts (the kind that can take MF only), which are just really bad. (e: or worse, the kind that are tied to a cash savings account with a lovely interest rate). It seems in the later pages the thread has turned a bit. That shows me for posting before finishing the whole thing. The e-series funds are fine, but I guess I don't know why you wouldn't go direct to ETFs like iShares. Let's say you only have enough to save $2000 per year. This is enough (approx) to allow you to buy a board lot (100 units) of the XIU, at a cost of  plus the 0.18% MER. Over a 10-year horizon, the transaction fee is vanishingly small, only 0.05%, for a total of 0.23 in annual cost%. This is compared to the best mutual funds which are significantly more than that. Since you're never ever going to trade these things (buy it, forget about it), it doesn't matter that you'd get dinged for doing so.On the RRSP vs. TFSA question, if you can only pick one, then pick one, is the simple answer, and save on fees paying for both. They're actually essentially indifferent in a flat marginal rate environment for a given level of return. In spite of views regarding funding of the CPP, you can't really assume that the marginal rate will change due to exogenous factors when making an investing decision. If anything, I'd be biased to it decreasing as has been happening to corporate rates. There's good research that this actually increases tax receipts for a government over time. Disregarding this, you can make the reasonable assumption that your personal marginal rates will be lower, unless you are way into the top bracket. It's a very small subset of people that save sufficiently to actually have similar income in retirement. This makes the RRSP objectively better for the vast majority of tax payers, i think. Your situation of being self-employed and having a lot of savings kept elsewhere is a relatively uncommon one, I think. The calculations I was going to show refer more to an allocation across the RRSP and TFSA where you have enough funds to use, but not max out, both. The surprising result is that even if you are careful (lucky) enough to get all your higher-returning investments into your TFSA, you will still likely be better off having them in the RRSP rather than the TFSA due to the marginal rate savings, unless there's a fairly significant difference over a long horizon. Final point on choosing between the two - the RRSP has the benefit of stealth savings. Personally, when I put money into my RRSP, I treat it no differently than any other after-tax use of funds, but instead of taking a trip with my tax return, I force myself to invest that also, which means I end up not only making at least as good returns on the initial investment, but having more funds invested overall. Hopefully no-one is budgeting on using a tax return to make day to day payments, so this should be relatively easy to do for most people. Said a different way, I save during the year assuming I won't get a refund. If I do get one, I invest it, as I already budgeted for not having it. The RRSP facilitates this because any non-payroll contributions will result in a refund, while the TFSA does not. Kalenn Istarion fucked around with this message at 19:36 on Jan 23, 2014 |
|
#
?
Jan 23, 2014 19:28
|
|
|
Kalenn Istarion posted:The e-series funds are fine, but I guess I don't know why you wouldn't go direct to ETFs like iShares. Let's say you only have enough to save $2000 per year. This is enough (approx) to allow you to buy a board lot (100 units) of the XIU, at a cost of The Canadian index e-series, comparable to XIU, has a MER of 0.33%. I realize that 0.33% > 0.18%. But it's pretty drat close. And it carries with it the following advantages:
I'm not arguing that the Canadian e-series is an optimal choice (it isn't). But it goes a long way towards taming that oft-destructive, oft-ignored aspect of investing: human emotional frailty. I've gotten lots of people into indexing investing this way - it would've been a far harder sell getting them to buy XIU and VTI.
|
|
#
?
Jan 23, 2014 20:32
|
|
|
Lexicon posted:The Canadian index e-series, comparable to XIU, has a MER of 0.33%. I realize that 0.33% > 0.18%. But it's pretty drat close. And it carries with it the following advantages: Close, it's almost twice as expensive! Hyperbole aside, yours is a reasonable position if your intention is to use it as a gateway to get people to move up to the big-boy tools. On the cost-averaging point, it's a question of scale. If you're investing $2000 a year, but doing so over a 30-year career, investing once a year at the start of the year is going to average you in just fine. On the trading platform discussion, I've used both BMO and TD's discount trading platforms and I'm hard pressed to see a material difference between the two. They're pretty equivalent functionally and have similar pricing. I believe BMO has moved to a flat-rate pricing structure for all levels of investment dollars though (similar to RBCDI). Have heard the RBCDI platform has gotten better in recent years but is still not comparable to TD and BMO. CIBC and Scotia are generally thought to be worse in all respects but I haven't seen or used them myself. There was also a question from a few people earlier in the thread about moving money around. I personally use email money transfers. Most accounts will now include at least a few free ones a month and many institutions recently increased the per-transfer cap. I know I just sent $3,000 the other day with no issues. If you need to move money quickly, the only way to do it faster is to physically walk between two branches as the email transfers now arrive in less than an hour and you can deposit it immediately in the transferee account.
|
|
#
?
Jan 23, 2014 20:53
|
|
|
Kalenn Istarion posted:Close, it's almost twice as expensive! Hyperbole aside, yours is a reasonable position if your intention is to use it as a gateway to get people to move up to the big-boy tools. This feels a bit like you are passionately advocating the merits of kale over broccoli, when the real goal is simply to convince someone to stop eating nothing but cheeseburgers. Broccoli, as with e-series, will probably be an easier sell to start with And in fact - there's room for both. I have the bulk of my portfolio in ETFs in Investorline, but I still contribute weekly to TD e-series on an automatic basis.
|
|
#
?
Jan 23, 2014 21:04
|
|
|
Kale is clearly the best. Ultimately it comes down to what works for you - I prefer to be a bit more active, and so opt to make relatively chunky, manual investments. This may have something to do with the way I'm compensated by my employer, which is chunkier than most. If the auto-transfer works better with your income flow then at the margin it's better to get the money in than not, so I agree on that point. We're both clearly advocating that the paleo diet is bad and will give you a heart attack.
|
|
#
?
Jan 23, 2014 21:17
|
|
|
It sounds to me like you are agreeing with one another. I am certain Lexicon understands that 0.18 and 0.33 are fundamentally different numbers applied to large sums of money across a long period of time. He is the one that raised the quarter century measure for MER, so I expect he gets your point Kalenn. Compared to 2.00+ they are both infinitely better. Lexicon the one thing you missed with regard to ETF is, at the end of the day, a primary advantage for those of us who get involved a little more actively, and that is liquidity. XIU, as an example, I can literally sell and turn into cash in one second. You can't do that with any Mutual Fund I know of. I will also agree that there are plenty of ETF's which see lower volumes and are not much more liquid than a MF, but I tend to avoid them as a rule, because liquidity matters a whole lot to me.
|
|
#
?
Jan 23, 2014 21:37
|
|
|
Saltin posted:It sounds to me like you are agreeing with one another. I am certain Lexicon understands that 0.18 and 0.33 are fundamentally different numbers applied to large sums of money across a long period of time. He is the one that raised the quarter century measure for MER, so I expect he gets your point Kalenn. Compared to 2.00+ they are both infinitely better. You are right, something like the Canadian e-series fund is technically less liquid that XIU. It took me a couple of days to get my e-series money out last time. Obviously no ability to set limit prices or anything of that nature. But I don't think that difference between these two investments should be of much practical concern to the small-time, mostly-hands-off investor - especially new ones. Same for the MER difference. Anyone with half-decent amounts of money to invest, no question, should go straight for the ETFs. They are more efficient as I already stated, and expose more sophisticated asset classes, strategies, etc. I'm merely tacking on a small exception to the claim that 'Everyone should buy ETFs like XIU'. Saltin posted:0.18 and 0.33 are fundamentally different numbers applied to large sums of money across a long period of time. This is, of course, a very good point. When large sums of money and long period of time are both true, low costs are incredibly important. Lexicon fucked around with this message at 21:51 on Jan 23, 2014 |
|
#
?
Jan 23, 2014 21:47
|
|
|
This is most likely a series obvious question but I'd like to confirm with you experts. If I wanted to take a short position on a particular stock, say, hcg.ca, which is traded on the TSE all I would need to do is open a questrade account, put some money in it from my online banking, and click some buttons on their web ui right? Then, if the shares go from $80 to $160 I would lose my entire investment or have to add more money to cover the loss. However if it went from $80 to $0 my initial investment would increase 8-fold. Yeah? Econ101 panning out for me?
|
|
#
?
Jan 24, 2014 04:38
|
|
|
I could save about $1400 in taxes by shoving $4000 in an RRSP. My marginal rate is 38.37% ( ) and my total tax comes out to about 23%. What do you guys think? Am I better off paying the tax man and sticking to TFSA, or using the RRSP to lower the tax bill?It's going to be my first year without a refund 
|
|
#
?
Jan 24, 2014 05:07
|
|
|
Corrupt Cypher posted:This is most likely a series obvious question but I'd like to confirm with you experts. Oh geez. You might want to learn about shorting, interest on borrowed shares, and margin before you actually try doing something like this. Just the fact you are thinking you would lose your entire investment without realizing your potential loss is actually infinite, says you shouldn't be doing this yet.
|
|
#
?
Jan 24, 2014 05:08
|
|
|
Kal Torak posted:Oh geez. You might want to learn about shorting, interest on borrowed shares, and margin before you actually try doing something like this. Just the fact you are thinking you would lose your entire investment without realizing your potential loss is actually infinite, says you shouldn't be doing this yet. This. A thousand times.
|
|
#
?
Jan 24, 2014 06:33
|
|
|
If you have to ask about shorting stocks on somethingawful.com you should not be shorting. So don't do it.
|
|
#
?
Jan 24, 2014 13:31
|
|
|
I appreciate the forewarning guys, truly I think you guys are pros and I love these threads. I've read this thread in its entirety, the housing bubble thread in its entirety, and whatever analysis I can get my hands on regarding Canada's economic situation. The truth is I am 100% positive doomsday is coming and I'm willing to take the risk for the opportunity of reward. I intend on placing a small bet on the situation with the understanding it is a high risk investment, and really more analogous to gambling than anything else. I did some more reading after that post and now understand I will be paying interest to the broker covering my short sale, and that there are other options including put options and LEAPS. Am I correct in saying you guys are being hyperbolic when suggesting my potential loss is infinite. Yes, of course, if HGC.ca went to $1000/share I'd owe 12.5 times my initial investment, but the reality is that a broker would force the sale long before that happened (or you could build that into the order with whatever broker you use). My big question was how one practically completes trades in Canada. Are all of these things possible via Questrade?
|
|
#
?
Jan 24, 2014 15:31
|
|
|
Corrupt Cypher posted:I appreciate the forewarning guys, truly I think you guys are pros and I love these threads. I've read this thread in its entirety, the housing bubble thread in its entirety, and whatever analysis I can get my hands on regarding Canada's economic situation. The truth is I am 100% positive doomsday is coming and I'm willing to take the risk for the opportunity of reward. I intend on placing a small bet on the situation with the understanding it is a high risk investment, and really more analogous to gambling than anything else. Yes, of course. Questrade is a broker. You can do any of that using a margin account at Questrade. A lot of US investors shorted the hell out of HCG thinking they same thing you are now. They got their hat handed to them. Good luck.
|
|
#
?
Jan 24, 2014 15:45
|
|
|
Corrupt Cypher posted:I appreciate the forewarning guys, truly I think you guys are pros and I love these threads. I've read this thread in its entirety, the housing bubble thread in its entirety, and whatever analysis I can get my hands on regarding Canada's economic situation. The truth is I am 100% positive doomsday is coming and I'm willing to take the risk for the opportunity of reward. I intend on placing a small bet on the situation with the understanding it is a high risk investment, and really more analogous to gambling than anything else. If you bet $5 on roulette, the most you can lose is $5. If you bet $5 on shorting stocks, the most you can lose is infinity + $5. If you want to gamble, go play roulette. As for your doomsday prediction, people have been predicting doomsday since 3000 BCE... I'm still waiting.
|
|
#
?
Jan 24, 2014 15:49
|
|
|
I've never understood the doomsday people. If you honestly thought a collapse of that scale was imminent, wouldn't you get busy accumulating weapons, ammo, water, diesel and tinned food? I wouldn't trade you a can of beans for $1000 if there was a complete economic collapse. Doomsday is coming! I will give my cash to the institution!
|
|
#
?
Jan 24, 2014 15:58
|
|
|
FrozenVent posted:If you bet $5 on roulette, the most you can lose is $5. Well this is actually pretty interesting and I'd like to pose some followup questions. I think it's safe to say you can set up a short sale so that the maximum you would lose is your initial investment. You make sure your broker sells before you start owing them money past your initial investment. I don't intend on utilizing margin investing in this case, because that would certainly scare the hell out of me and your warning would be quite astute. As far as I'm concerned placing an investment of any kind is gambling. If you buy a house in Canada right now, you are making a bet that the value of the house will appreciate, and certainly the majority of Canadians presently are operating on this principle. When I look at the present housing market conditions, and Canada's economic situation as a whole, the thought of purchasing a house is what would frighten the hell out of me. I actually feel much more secure with my HCG roulette table! I should clarify, I don't think the world is going to come to an end, but I do think the current state of Canada's economy is ridiculous and there is pain coming. I would like to profit from to offset all the extra taxes we'll be paying to cover the coming defaults! I do of course realize that a more risk averse position for someone with my opinion regarding the Canadian economy would be to purchase more foreign investments rather than short selling, which is inherently risky.
|
|
#
?
Jan 24, 2014 16:04
|
|
|
Saltin posted:I've never understood the doomsday people. If you honestly thought a collapse of that scale was imminent, wouldn't you get busy accumulating weapons, ammo, water, diesel and tinned food? I wouldn't trade you a can of beans for $1000 if there was a complete economic collapse. I think he means a collapse in the housing marker, not a collapse in social relations. I'm long term pessimistic on the real estate here, too. The problem is you can't really hold a short position. You can see a bubble and still not know when it pops. Question: Is there a list of hidden fees associated with Questrade? They seem like the clear best option for ETFs but they have to be getting their money from somewhere.
|
|
#
?
Jan 24, 2014 16:06
|
|
|
Why do you think the economy is going down the shitter? As to your comparison to the housing market, you do realize that even if the market collapses, you still have a house, which is perfectly good for its intended purpose - to live in. If you're using it as a saving or investment vehicle, you're a fool or playing a bubble. If you gently caress up a short, all you're left with is a debt. You don't even have a security to sell.
|
|
#
?
Jan 24, 2014 16:08
|
|
|
Saltin posted:I've never understood the doomsday people. If you honestly thought a collapse of that scale was imminent, wouldn't you get busy accumulating weapons, ammo, water, diesel and tinned food? I wouldn't trade you a can of beans for $1000 if there was a complete economic collapse. I don't think he means doomsday in the literal sense - more like a Sept-2008 type event, but within the Canadian economy. Corrupt Cypher: I'm not going to try and talk you out of doing your short sell - by all means go for it if you understand the [considerable] risk. One point of advice though: don't confuse these three things:
The first one is actually pretty easy, in general. Take mobile computing - it was obvious long, long ago that it would eventually supplant the old-school model of beige PCs sitting on desks. Hell - Microsoft knew it too - they poured hundreds of millions of dollars into various [failed] mobile initiatives through the early 2000s. That doesn't mean it was easy to predict the when (arguably the iPhone launch) or the downstream consequences (rise of Android, commodity tablet manufacturers in China, etc, etc). Both of those things were unknowable through most of the 2000s, despite the easy initial prediction. So I understand the logic that looks at the various madness that exists in Canada today, and concludes that a day of reckoning is coming. It clearly is - I don't think many thinking people could definitively and convincingly argue otherwise, at this point. However, it simply does not follow that there's an easy buck to be made in shorting XIC or HCG or other schemes you might care to dream up based on the initial prediction. You don't know the timeline, and you don't know what will happen. You can't know these things. That said, let us know how it goes.
|
|
#
?
Jan 24, 2014 16:13
|
|
|
TheOtherContraGuy posted:I think he means a collapse in the housing marker, not a collapse in social relations. I'm long term pessimistic on the real estate here, too. The problem is you can't really hold a short position. You can see a bubble and still not know when it pops. The fee schedule is here: http://www.questrade.com/pricing/admin_fees There's no hidden fees. There is a $20 fee per quarter if you have less than 5K in assets.
|
|
#
?
Jan 24, 2014 16:14
|
|
|
Kal Torak posted:The fee schedule is here: http://www.questrade.com/pricing/admin_fees That fee is per account too, I believe (or at least it was - my girlfriend got stung on that). So $4k in a non-reg and $4k in a TFSA will each incur it per quarter.
|
|
#
?
Jan 24, 2014 16:16
|
|
|
Lexicon posted:That fee is per account too, I believe (or at least it was - my girlfriend got stung on that). So $4k in a non-reg and $4k in a TFSA will each incur it per quarter. I don't think that is accurate. Here is the fine print. quote:1. As of October 1st, 2012, an inactivity fee of $19.95 per quarter is charged to clients with under CAD $5,000 in combined total equity for any quarter in which the client does not complete one commissionable trade. Commissionable trades include free trades or trades made using commission rebates. Combined equity includes all accounts owned by a client, including joint accounts. Clients are exempt if they are 25 years of age or under, or are subscribed to a level 1 (or greater) data package. Charitable organizations are also exempt. If the client trades in the quarter after incurring an inactivity fee, the trades will be commission-free up to $19.95. For example, if a client incurs an inactivity fee on July 1st, any trades made in July, August or September will be commission-free up to $19.95.
|
|
#
?
Jan 24, 2014 16:18
|
|
|
Ah. They must've changed that then. She definitely got charged twice.
|
|
#
?
Jan 24, 2014 16:18
|
|
|
Lexicon posted:Ah. They must've changed that then. She definitely got charged twice. Maybe it's too late now but I've found that complaining to their customer support team usually works in getting fees reversed and such. The knock on them has always been bad customer service so I find they are pretty willing to do something if you complain enough.
|
|
#
?
Jan 24, 2014 16:22
|
|
|
FrozenVent posted:Why do you think the economy is going down the shitter? The basic Cole's notes of why I think the economy is going down the shitter is that real estate speculation in this country has been the reason we have weathered the last 5 years like superstars. Instead of feeling the same pain as the United States in 2008 we actually propped up our economy with cheap lending not for productive purposes, like building businesses that produce exports or investing in municipal infrastructure, but to build a shitload of condos in Toronto, Vancouver, and Calgary, and megahouses in the suburbs that surround them. If you look at the real estate situation in Toronto right now it makes absolutely no sense. There is a tonne of money floating around because developers are cashing in on consumers who are using mortgages (backed by the CMHC aka every Canadian taxpayer) that they are taking out with little financial consideration(It Will Go Up!). The jobs in Toronto are primarily in the financial sector, which guess what, is largely centered around our awesome and very profitable real estate market. It's a system that doesn't actually produce anything useful and is based on a closed loop of lax lending criteria and the assumption that prices of houses never fall. I don't understand why people treat houses and stocks inherently differently. Yes you can live in a house and you can't live in a stock. But the true cost of a house isn't that it has four walls and a roof, it's that the real estate is near somewhere you can generate income. If the income you're receiving is generated from housing speculation, is any wealth actually being created? I don't think so. I understand now that most people complete short sales without collateral and use margins instead. That is not and will never be my intention. That poo poo is scary as hell.
|
|
#
?
Jan 24, 2014 16:26
|
|
|
You're looking at a single segment of the economy in a vacuum, though. Be careful. What do you mean by "Shorting with collaterals"?
|
|
#
?
Jan 24, 2014 16:36
|
|
|
Lexicon posted:I don't think he means doomsday in the literal sense - more like a Sept-2008 type event, but within the Canadian economy. That is excellent advice not going on deaf ears. Your mobile computing example is excellent. The hindsight for that one I suppose would have been that the second you saw Google produce Android you should have known that Google usually has success with the things it pours money into and Android was a good product. On the same hand if I had made the same estimation for RIM and Microsoft's mobile devices one would be losing money out my rear end. It's gambling. It certainly is! I was debating this question last night. I know very little about HCG's actual holdings. In terms of where they own property, how they're leveraged, the terms of their debts that they hold, etc. The thing that gave me the most comfort was reading their Q3 forecasts: quote:Outlook I don't agree with any of that and think it's horse poo poo. I am making a gamble that we've pulled on the yarn to its limit and 2014 will be the year that the consumer is finally tapped out and the collapse will come. There are a bunch of ways I could be wrong about this of course. Maybe the devaluing of the CAD drives exports up, a war in Saudi Arabia opens up, and the Canadian economy remains strong making the home equity bubble not such a big deal via the Canadian consumer having lots of purchasing power via those profits. I'm betting that those things don't happen!
|
|
#
?
Jan 24, 2014 16:40
|
|
|
|
| # ? May 16, 2024 06:55 |
|
|
FrozenVent posted:You're looking at a single segment of the economy in a vacuum, though. Be careful. How I see the exchange taking place is: Say I short $1000 worth of $77 HCG. I would have $1000 in my brokerage account to cover that investment. If the prices goes past $154/share (probably a lower # due to the interest I must pay the broker) I have run out of my $1000 and would force the call on the short sale to ensure I don't exceed my initial collateral. I suppose what I'm gleaning from this is my $1000 is never actually held by the broker, it's still with me, or why would I be paying them interest? So in reality what I would do is have to say to put the order in that if it ever exceeds $154/share, call the short and I will cover the $1000 that I agreed with myself about back at $77/share. I can see how this would get out of hand in a hurry if you didn't have the constitution to stop the loss at your completely personally agreed upon acceptable loss.
|
|
#
?
Jan 24, 2014 16:52
|
|