Investment Thread

[YmoBeThere]

If you like digging into some of the high stakes games played in our financial markets, may I strong recommend Flash Crash by Liam Vaughan, which chronicles the shenanigans behind the 2010 mini crash in which the Dow dropped 600 points in five minutes...a prime takeaway being that it can take years for regulators to figure out precisely what has happened (not implying it will take that long to decipher this current case)...

If people can make money by gaming or bending the rules, they will. Flash Crash is pretty fascinating...featuring the proverbial guy sitting in his bedroom at home mangling markets.

Great, fast paced read. Certainly raises interesting questions as to why some kinds of market action is deemed manipulation. Main character certainly no fan of hedge funds.

I read Flash Boys by Michael Lewis. Similar?

[budwom]

I read Flash Boys by Michael Lewis. Similar?

yeah, though this particular Flash Crash guy was really one of a kind...some insane market manipulation he (and others) were able to get away with, beyond the comprehension of most regulators...

[YmoBeThere]

Looks like Silver is the Soup du jour...

[Jeffrey]

Looks like Silver is the Soup du jour...

Wonder how many Redditors are aware of Silver Thursday? History repeats and the ignorant usually pay.

[niveklaen]

https://www.reddit.com/r/WhitePeople...a23uv/buy_gme/

Did the federal government intervene to halt the gamestop trading?

[MChambers]

https://www.reddit.com/r/WhitePeople...a23uv/buy_gme/

Did the federal government intervene to halt the gamestop trading?

I very much doubt it. It's not like the SEC folks are worried about the fortunes of some hedge funds.

I really think this is all explainable by the need of the brokers (Robinhood and some others) to meet capital requirements at the clearinghouse. I don't think the SEC could have prevented the clearinghouse and the brokers from limiting trading while additional capital was acquired.

[Mtn.Devil.91.92.01.10.15]

Wonder how many Redditors are aware of Silver Thursday? History repeats and the ignorant usually pay.

The scuttlebutt of Reddit is that the silver rumor is being purported by hedge funds and is a false flag.

Not sure how that all plays out, but wouldn't be surprised to see the big boys try to reverse the script on the Redditors.

[niveklaen]

https://www.reddit.com/r/WhitePeople..._these_shills/

I wonder how much money the hedge funds lost driving the price up that first 5% hoping that WSB would take the bait?

[YmoBeThere]

This is all beginning to feel like stuff that went on in that quadrennial thread that shut down recently.

[cspan37421]

Becoming a CFA Charterholder is incredibly difficult. I know 2 Fuqua MBAs that gave up because it was too hard.

I hope they didn't try to become actuaries. It's no contest ... at least, it wasn't when I did them (90s). Not so sure about now.

[bundabergdevil]

The tug of war continues.

[Jeffrey]

I hope they didn't try to become actuaries. It's no contest ... at least, it wasn't when I did them (90s). Not so sure about now.

You have both? That’s extremely impressive!

[Jeffrey]

The tug of war continues.

This it is and nothing more.

[cspan37421]

You have both? That’s extremely impressive!

Thanks - but I can tell you I don't have a corner office or a job title beginning with a C.

But what I do have are a very particular set of skills, skills I have acquired over an extended adolescence.

Among them ... test-taking skills.
so yes ... FSA, CFA are the big ones.

I was more impressed with the quality of the CFA exam syllabus (sources, organization, process, etc.) But the study hours necessary, the pass rate, and travel time (years to completion) were not in the same league as actuarial exams. The first and third of those were 2-3 times higher on the actuarial side. I recall it got so bad that the SOA worked hard to reduce travel time - after I finished, of course. As I recall, the average time to completion was nearly 11 years at one point (25-30 yrs ago). How much less it is now, I don't know.

But anyway, that and $34 + tax will get you a BAII Plus.

[nmduke2001]

Thanks - but I can tell you I don't have a corner office or a job title beginning with a C.

But what I do have are a very particular set of skills, skills I have acquired over an extended adolescence.

Among them ... test-taking skills.
so yes ... FSA, CFA are the big ones.

I was more impressed with the quality of the CFA exam syllabus (sources, organization, process, etc.) But the study hours necessary, the pass rate, and travel time (years to completion) were not in the same league as actuarial exams. The first and third of those were 2-3 times higher on the actuarial side. I recall it got so bad that the SOA worked hard to reduce travel time - after I finished, of course. As I recall, the average time to completion was nearly 11 years at one point (25-30 yrs ago). How much less it is now, I don't know.

But anyway, that and $34 + tax will get you a BAII Plus.

That's impressive. I didn't realize that the FSA was so difficult. Wow. I know that the CFA usually takes 3 -5 years these days. I was considering getting it but it really doesn't help in my position. Instead, I went with the CFP® and CPWA®. The CPWA was more difficult but worth the effort.

[cspan37421]

The CPWA was more difficult but worth the effort.

You need a nickname for it. For us, SOA stood for "source of agony"

I can think of something for A, and maybe P. Remember the acronym PITA (pain in ...)

[Jeffrey]

Thanks - but I can tell you I don't have a corner office or a job title beginning with a C.

But what I do have are a very particular set of skills, skills I have acquired over an extended adolescence.

Among them ... test-taking skills.
so yes ... FSA, CFA are the big ones.

I was more impressed with the quality of the CFA exam syllabus (sources, organization, process, etc.) But the study hours necessary, the pass rate, and travel time (years to completion) were not in the same league as actuarial exams. The first and third of those were 2-3 times higher on the actuarial side. I recall it got so bad that the SOA worked hard to reduce travel time - after I finished, of course. As I recall, the average time to completion was nearly 11 years at one point (25-30 yrs ago). How much less it is now, I don't know.

But anyway, that and $34 + tax will get you a BAII Plus.

That’s extremely impressive; I suspect less than a thousand people in the world have both!

I certainly believe you should be sitting in a corner. Many financial firms would benefit greatly from your unique and very valuable expertise. IMO, Berkshire would be a great example.

[mpj96]

Caught the end of an NPR discussion this morning about payment for order flow that seemed to illuminate why many platforms will allow you to hold stocks and funds on their platforms at no cost. The platform sells their order flow through to funds that are faster and can jump the line to take positions ahead of your placed order. This seems like a much better exchange for the platform than what one platform told me when I asked how they make money ("we hope you will buy some of our funds"). Is that really how it works? Sell your free order flow to folks who will jump ahead of your orders to nibble at the spread?

If so, what is the solution to avoid being part of that order flow herd. One could use a pay to play platform but are they restricted in any way from doing the same thing?

Caveat: I only heard the last 60 seconds or so of the dialogue and may have missed some key points. Would be grateful for correction / education if I have grossly misunderstood the status quo.

[YmoBeThere]

Caught the end of an NPR discussion this morning about payment for order flow that seemed to illuminate why many platforms will allow you to hold stocks and funds on their platforms at no cost. The platform sells their order flow through to funds that are faster and can jump the line to take positions ahead of your placed order. This seems like a much better exchange for the platform than what one platform told me when I asked how they make money ("we hope you will buy some of our funds"). Is that really how it works? Sell your free order flow to folks who will jump ahead of your orders to nibble at the spread?

If so, what is the solution to avoid being part of that order flow herd. One could use a pay to play platform but are they restricted in any way from doing the same thing?

Caveat: I only heard the last 60 seconds or so of the dialogue and may have missed some key points. Would be grateful for correction / education if I have grossly misunderstood the status quo.

It is really a scale concern I would think. I buy in relatively small amounts and very infrequently that I'm of the belief that this will have a minor impact to my overall performance. The fact that MSFT has risen 53.7% per year in the time I've owned it is far more influential.

[Bluedog]

The no commission brokerages make money from interest. Earning interest on cash (not substantial these days), earning money from lending securities to enable short selling (can be substantial, Vanguard funds sometimes beat the index because they pay these back out), and interest on margin (can be very high fees).

Here's M1 Finance with more details:https://www.m1finance.com/blog/how-m1-makes-money/