The bears den

[sfugel]

Volatility IndeX

Thank you eD1son

 

[revhappy]

Nordea bank is saying markets are underestimating the magnitude of Fed rate cut, meaning, Fed will cut a lot more than the market is pricing in. Interesting:

https://e-markets.nordea.com/#!/article/49247/fx-weekly-cut-cut-cut-cut

 

[revhappy]

historically it has been a bad idea to be long equities in (and in particular after) the first rate cut from the Fed (based on 1989, 1995, 1998, 2001 and 2007 data).

Though the precautionary rate cuts in 1995 and 1998 made equities rally (see table below), but the big difference from 1995 and 1998 to now is that markets didn’t price a big cut-cycle already before the cuts (as is the case now). We think it makes sense to fight the Fed and stay positioned for further downside in equities

https://e-markets.nordea.com/#!/article/49235/week-ahead-where-is-stephen-moore-when-you-need-him

 

[lightchaser]

Yes you may but you have to factor in these differences:
1) property you can borrow 400% of invested capital, stocks you can borrow max 70%.
2) for property, banks will not request top-up when property price drop, while banks quickly reduced you loan amount & demand top-up (i got hit before).
3) property loan interest rate is much lower than equity loan.

property is also perceived to be safer and hence we dare to leverage to the max. Do we dare to do this for stocks ? this is a very huge and crucial diff .

 

[Trader11]

property is also perceived to be safer and hence we dare to leverage to the max. Do we dare to do this for stocks ? this is a very huge and crucial diff .

Heard of black Swan? What if real estate drops alot?

 

[NewInvestor]

Heard of black Swan? What if real estate drops alot?

Nah, that's unlikely to happen in Spore. Tightly regulated. It is in all stakeholders interest to keep up the price. Also the gahmen now has so many tools to push up the market if it wants to.

I would say that the main problem about property investment is that it goes through long periodic bouts of liquidity. In theory, you may have made so much and so much but can you realise your gain if u want to? That's the one problem I have faced in three decades of prop investment.

 

[lightchaser]

Heard of black Swan? What if real estate drops alot?

During black sawn, shares drop much much more horribly than ppty.

 

[SBC]

Many youngsters had not experienced any black swan event.

Good to have 2-3 experiences throughout your working life.

 

[NewInvestor]

Nordea bank is saying markets are underestimating the magnitude of Fed rate cut, meaning, Fed will cut a lot more than the market is pricing in. Interesting:

https://e-markets.nordea.com/#!/article/49247/fx-weekly-cut-cut-cut-cut

My REITs and bonds have greatly benefited from rate cut rumours. So I am cheering for cuts cuts and more cuts.

What is the most efficient way of investing in gold?

 

[Trader11]

Nah, that's unlikely to happen in Spore. Tightly regulated. It is in all stakeholders interest to keep up the price. Also the gahmen now has so many tools to push up the market if it wants to.

I would say that the main problem about property investment is that it goes through long periodic bouts of liquidity. In theory, you may have made so much and so much but can you realise your gain if u want to? That's the one problem I have faced in three decades of prop investment.

What's the assumption? Alot of impossible things can happen no matter how small the probability is. What if people lose their jobs or reduced demand?

 

[revhappy]

My REITs and bonds have greatly benefited from rate cut rumours. So I am cheering for cuts cuts and more cuts.

What is the most efficient way of investing in gold?

You can buy the GLD etf.

 

[SBC]

You can buy the GLD etf.

Any Bull or Bear 3X for Gold ETF?

 

[Mecisteus]

Any Bull or Bear 3X for Gold ETF?

Leveraged Exposure - IB Spot Gold and IB Spot Silver can both be traded on margin.

 

[coolhead]

Any Bull or Bear 3X for Gold ETF?

Can try nugt or jnug but take note they are meant for short term holding only.

Sent from HMD Global TA-1004 using GAGT

 

[BBCWatcher]

Yes you may but you have to factor in these differences:
1) property you can borrow 400% of invested capital, stocks you can borrow max 70%.

No, the options and futures markets let you make all sorts of highly amplified bets if that's what you wish to do. I know people keep claiming that mortgages and real estate are somehow special in terms of leverage, but it's just not true. Mortgages are very crude, weak instruments in comparison to futures, options, and margin trading.

To repeat, I'm not necessarily recommending anything here.

2) for property, banks will not request top-up when property price drop, while banks quickly reduced you loan amount & demand top-up for equity loan (i got hit before).

Are you unfamiliar with the Asian Financial Crisis? That's exactly what happened with some mortgage borrowers. And there's no "margin call" as such on pure options and futures arrangements.

Honestly, I think these arguments betray a lack of understanding of modern -- as in, within the past 20 years or so -- financial markets and what they can do.

3) property loan interest rate is much lower than equity loan.

No, not any more, not in apples to apples comparisons (U.S. dollar to U.S. dollar, as a notable example). And that's just the margin. Options and futures are highly developed instruments in stock markets such as U.S. markets, notably, and they really don't have useful, highly traded parallels in real estate -- not yet anyway.

Again, I don't recommend anything in particular, but the idea that real property is somehow "special" really doesn't hold water. If it's special, it might be specially challenged (taxes and heavy government intervention, notably).

 

[revhappy]

There is no need to argue over property v/s stocks. They are generally well correlated. During Asian financial crisis both SG stocks and property were clobbered.

So I think some people are better in property investing and others are better in stocks investing. Choose whatever vehicle you are good at.

 

[BBCWatcher]

So I think some people are better in property investing and others are better in stocks investing. Choose whatever vehicle you are good at.

I don't agree with this.

Don't choose. Keep your investment portfolio reasonably well diversified, that's all. Sectors, geographies, etc.

The "typical" lack of diversification problem among Singaporean investors is being too heavily concentrated in regional and local real estate. Thus the typical and tired "stocks suck" sort of arguments are frequently window dressing for trying to justify heavily overweighting real estate in an investment portfolio. I don't recommend overweighting anything, at least not much.

 

[Mecisteus]

Back to the topic.

So any bears turning bullish now?

 

[revhappy]

Back to the topic.

So any bears turning bullish now?

No way. I believe in the phrase, the higher they go the harder they fall. While we are in the midst of a bubble, it feels it will go on and on and on. It is only in hindsight, we will realize, it was all clear, yet people were burying their heads in sand like ostriches.

Examples; Nasdaq during the dotcom boom bust, Japanese equities and very recently the bitcoin boom and bust.

 

[SBC]

Following US 2nite rise, DJ is just like 400 points away from its peak just 2 months ago.