So I have recently been doing a lot of research on recessions, and it’s hard to deny that it looks like we might be sitting on the brink of one. I recently watched a video by Jake Tran regarding the striking similarities between the Great Depression and today. Rock bottom interest rates on the rise, the average debt of individual Americans, the number of retail investors involved in the market (which also correlates with Germany’s hyper inflation in the WW1-2 era as suggested by Michael Burry), and the fact that wealth inequality is at an all time high since the days right before the Great Depression. It seems to me at least that we are looming over some treacherous waters.
How does that correlate with GME?
Well, as we have seen, anytime there is an increase in GME there is a corresponding decrease in the rest of the market. Whether that be from hedge funds liquidating other stock to fight the GME war or the general fear of investors of the implications that come with GME. It has now happened both with the January and February rises and is not a coincidence. The markets fell by as much as 3% in a single day when GME was on the rise.
Now, there has been some talk of a gamma squeeze still in the making. I’m not sure about it, but some Redditors are putting the date as March 19th, or at least in the weeks surrounding March 19th. How accurate is that? IDK you apes can go find the DD yourself, but it certainly seems a distinct possibility. If it does occur though, and it squeezes into the thousands or even tens of thousands, the resulting impact on the market will be tremendous. And given the delicate situation the market is in, could very well trigger a recession.
Now what I find interesting is what happens in a recession, theoretically pinpointed on March 19th. Whenever a countries economy gets slapped around it affects the global economy, and a crash on this scale would certainly cause global issues. Historically, whenever there has been recessions, war always breaks out. Almost every time. Not necessarily in the US, but across the other nations as well. Considering our recent forays into the Middle East again, I don’t see us not getting dragged in. I also believe the tense situations over in that China, India, Pakistan area is a powder keg ready to let loose as well (remember all those Tik Toks with the Pakistani kids vowing to destroy India? They hate each other).
So at this point, given where we stand, I almost think it’s more risky to not have a... keep reading on reddit ➡
First, you may have seen my prior post on CCIV or comments in the mega thread. Schadenfreude absolutely got the best of me. I wanted to take a more composed look at what has happened, and include my own experience with a large loss. Frankly I don't root for people to lose money, but at the end of the day if stocks didn't have any risk, there would be minimal rewards. If they only went up, they would become overvalued until someone inevitably sells, thus leading to a decline. Over the last month or two, a number of "investors" felt invincible in either GameStop, Lucid, random high flying growth stocks, crypto, etc. The point of investing is to make money. To make money, you have to realize profits. To realize profits, you have to sell. That's how this works. When and where you sell is up to you, but at some point you do have to sell.
When the market started tanking around a year ago, I was just getting started dabbling with options. I had seen the ridiculous Tesla plays and wanted in on the gains, so when Covid hit, I YOLO'd all my money ($10k at the time) into SPY puts on Robinhood. Promptly turned that into $33k around mid March. So what did I do that that point? Well people are dying, the world is shut down, everyone is losing their job, and liquidity is drying up. I bought $33k in SPY puts.
You can imagine what happened next. Fastest rally ever, and I went back to $10k real fast. 67% losses after a homerun hurts, bad. I know how that feels. Losses hurt way more than their equivalent wins, and it sucks that that's how it is. I thought the market was wrong, the virus kept getting worse yet stocks kept going up. Fortunately, I cashed out and ended up finding SPACs, but that's not the point. I know how easy it is to get caught up in the hype and trade emotionally.
Psychology is the most important field to study if you want an edge in investing, because it can help you control yourself and understand others. Humans have a few key tendencies that really appear during volatile markets: Pain-avoiding psychological denial, Deprival superreaction tendency, and excessive self-regard tendency (coins termed by Charlie Munger) all rear their ugly heads from time to time.
I'm not going to do a deep dive, but in summary we tend to deny outcomes that are especially hard to bear, become irrationally upset when something is taken from us, and think overtly highly of ourselves. When these biases are aligned with our investments, watch out.
SPY puts were my price of... keep reading on reddit ➡
Lots of things have been said over the years (sigh) about how Linear Fusions could be buffed, but I think they often get too in the weeds. LFRs need to be usable, but they also need a use.
Giving LFRs inverse range would mean that the further you are from an enemy, the more damage you deal.
This would make LFRs stronger in their intended usage, and would cement their dominance in that use. You want to put distance between yourself and your target, because that’s how you deal the most damage.
And that’s interesting. No other weapon archetype plays like that.
We don’t need LFRs to be special ammo so that they fail to compete with snipers even more directly. A damage buff could make them usable, but they’d still just be a wind-up sniper.
We need LFRs to carve their own niche. Right through hive skulls. A mile away from us.
As the stock market has been going down a little recently, I've been looking into ways to reduce the losses of my portfolio. I don't have enough capital to sell calls on most of my stocks which would've been my preferred method and I'm not using put options because buying a contract far enough out to cover when this correction could happen was more than I wanted to be hedged. The strategy I decided on was using inverse ETFs.
Inverse ETFs are designed to perform as the inverse of an index or benchmark it tracks. You can also find leveraged inverse ETFs that are 2x or 3x so if SPY goes down 1% they will go up 2% or 3%. I decided I wasn't willing to bet too big on a market correction so I stuck with just 1x inverse ETFs.
I chose SH the inverse of SPY and PSQ the inverse of QQQ to put money into. I plan on holding these just over the short term so maybe a few weeks to a month or so. Inverse ETFs are not something you just buy and hold as they will go down over time and since it will be a short-term trade, I've done this in a retirement account.
One thing I've realized that happens from owning inverse ETF shares is that I actually look forward to red days as I'm making a little extra money plus I get to buy the dip. If the market never really dips down, I don't have enough in them that the loss would have much impact on the overall portfolio. I would definitely recommend looking into inverse ETFs if you are looking for a way to hedge some money however it still is a risk you could lose a lot or all the money you put in them so they will need to be actively managed.
Interested to hear what are other people's experiences with inverse ETFs are.
Puts on top 10 most talked about stocks on wallstreetbets
Now here me out. We all know hedge funds have gotten wise to WSB pumps and it looks like they’re bidding them up big and then dumping en masse once all the tards jump in with their allowances.
What if we just piggyback on the hedge fund WSB pump and dump? Just wait till everyone is holding their hyperinflated bags, then use put debit spreads to make some of that hedge fund tendie deluxe?
Why put spreads? Because by the time the apes jump in, IV will be through the roof and the only way to mitigate some of that jacked up premium is to use some kind of spread.
Who’s down to get a little gay and make some 🌈 🐻 tendies?
When most investors picture bear markets, they envisage a situation characterized by a huge sell-off and multiple losses across the board. Yet again, most investors are of the opinion that the only way one can make money in bear markets is by short selling. However there are several financial instruments that enable investors to profit from declining market prices. One of such is inverse ETFs.
What is an Inverse ETF?
Inverse ETFs are designed to make money when the stocks or underlying indexes they target go down in price. These funds make use of financial derivatives, such as index swaps, in order to profit from the decline in stock prices. Unlike shorting a stock, though, investors in inverse ETFs can make money when markets fall without having to sell anything short.
Advantages of Inverse ETFs
Inverse ETFs provide investors with an alternative way of placing bearish bets. They are also less risky than other forms of bearish bets. When an investor shorts an asset, there is theoretically unlimited risk, and the investor could end up losing much more than they had anticipated. With inverse ETFs, an investor can only lose as much as they paid for the ETF. In an absolute worst-case scenario, the inverse ETF becomes worthless—but at least you won't owe anyone money, as you might when shorting an asset in a traditional sense.
Disadvantages to Inverse ETFs
One of the main risks of inverse ETFs is their lack of popularity. While you can buy many types of ETFs, you won't find a huge selection of inverse ETFs. With fewer options and less demand, inverse ETFs have less liquidity than other ETFs.
For example, the ProShares inverse ETF tracking the S&P 500 (SH) has an average daily trading volume of a little more than 6 million as of November 5, 2020.4 That's significantly less than the SPDR S&P 500 ETF (SPY), which has an average daily volume of more than 90 million during the same time period.5
Another risk is that, on a long enough timescale, major stock indexes have historically risen. That means that it's risky to use inverse ETFs as part of a buy-and-hold strategy—history suggests that the index will eventually bounce back from any losses in recent years. Inverse ETF investors need to pay close attention to the markets and attempt to exit their position before the corresponding index rallies.
Inverse ETFs to Consider
If you want... keep reading on reddit ➡
During the last squeeze, BAC moved inversely to GME. It's too much work for me to attach the charts, but the opposite movement is clearly there.
I do not think it was a coincidence that BAC put a price target of $10 on GME on January 27th. https://www.fool.com/investing/2021/01/27/bank-of-america-analyst-sees-gamestop-stock-plungi/
I believe BAC's drop was due to two reasons. 1) People thought BAC was somehow holding the bag on GME shorts. 2) People were concerned about GME bringing on the apocalypse.
If GME shoots up again tomorrow, look to see if BAC goes down. If so, it's time for puts as long as GME is rocketing.
TLDR: If GME is bigly up, buy BAC puts
This is a wild theory and not advice.
I realize the title isn't very clear, so here is the mechanism
For a race with N candidates, my ranked ballot gives N - 1 points to my 1st choice, N - 2 to my second choice, N - 3 to my third, and so on for as many candidates as I choose.
When tabulating results, we simply choose the candidate who gets the most points.
So for example, if we assume a 6-person race, and I choose A>B>C>D, then A gets 5 points (=6-1), B gets 4 points, and so on. It's sorta like range voting, but where no candidate can share the same score as another on the ballot.
So anyway, is there a name for this system, and if so, what are it's downsides?
FWIW I still prefer a score voting method like STAR, but it's possible this my suggestion has more simplicity and less strategy.
I had dinner with my parents today, and my dad said to my mom, “You know those French sisters from the gym?”
My mom looked at me like how silly is your father? and said, “They’re a couple.”
My dad looked at me like your mother must be smoking crack and replied, “They’re twins.”
Mom said, “You know when people have been together a long time and they start to look alike…?”
Dad said, “They’re identical twins.”
Look, I know someone’s gotta be wrong here, but I’m not entirely sure who, and I have so many concerns either way.
Final battle. Third avatar shows up. Psion hits the Avatar's pod with a Rift. Avatar teleports, directly into Outrider's unobstructed line of fire. Awesome. Outrider reloads, then hits Banish.
First shot, "Executed!"