Overlords Investment Conclave [OIC] Recruitment Thread

[Isgrimnur]

I'm considering putting a stop-loss on my SPY shares at 180.

[LordMortis]

I'm considering putting a stop-loss on my SPY shares at 180.

I hope you are joking. I have the curse! It all started with that damned house in 2003.

[noxiousdog]

Not sure I buy that as a valid metric considering why oil is down. And it's not like XOM has outpaced oil, oil has fallen out under XOM.

I think oil stocks will continue to take a beating so it's not time yet but when oil reverses they will be great buys.

I don't think it matters why. Profits are directly related the price of oil. If the company isn't as profitable, it's not worth as much.

[noxiousdog]

I'm considering putting a stop-loss on my SPY shares at 180.

Stop losses scare the crap out of me.

If I were you, I'd randomly pick dates and use a date window (you can manipulate the chart to show you, say, 1/16/12 - 6/16/12 to predict where you'd set the stop loss. Then move the window 6 months - 3 years (depending on your patience) to see whether it would have been a good idea or a bad one.

My experience would be that a stop loss gets triggered, and then you don't feel good enough about the market until the price has risen well above what you put the stop loss at in the first place.

Also, you probably know this, but either a stop loss will trigger a market order in which case it will always be sold at market price (stock closes monday at 100, market stop loss at 95, opens at 80 on tuesday, stock is sold at 80) or a limit order is which case it's skipped in a dramatic free fall (stock closes monday at 100, limit stop loss at 95, opens at 80 on tuesday, stock isn't sold because there's no buyers at 95).

[Isgrimnur]

I'm considering putting a stop-loss on my SPY shares at 180.

I hope you are joking. I have the curse! It all started with that damned house in 2003.

It hasn't been below 180 since early February. My overall cost basis on my 11 shares (retirement, here I come!) is $138.58. I don't expect it to be needed in the next six months that it's in effect, but better safe than sorry.

I put in the order as an insurance policy. If it hits, it will cost me $8.

[noxiousdog]

I'm considering putting a stop-loss on my SPY shares at 180.

I hope you are joking. I have the curse! It all started with that damned house in 2003.

It hasn't been below 180 since early February. My overall cost basis on my 11 shares (retirement, here I come!) is $138.58. I don't expect it to be needed in the next six months that it's in effect, but better safe than sorry.

I put in the order as an insurance policy. If it hits, it will cost me $8.

That's not the right cost. It will cost you $16 + the difference in price when you decide to buy back in. If you can (and do) buy back in under [the actual execution price], you're great. If you buy back in over $180 you have to add it to the cost.

If you never plan on buying back in, then it's not a bad idea, but you seem awfully young for that decision.

[Isgrimnur]

My thoughts are that, if something drops the market 10%, it's not going to stop at 10%. If the bottom hits at 179.99, I'll hit it at 185 on the way back up and count it as a lesson learned. If it keeps going down, then I'll be able to buy even more when the drop stops.

[Carpet_pissr]

when oil reverses they will be great buys.

IMO, they are great buys now. When oil reverses, they will no longer be (as) great buys. But you know this.

I will say though, that I am starting to see more and more mention (and investing pundits are NEVER wrong!!) of longer term thinking about the effect of electric/hybrid/LNG vehicles on the profitability of the oil companies, and could that possibly be a complementary factor.

The absolute obvious factor here is OPEC trying to squeeze the US shale companies out of business. We'll see how long they can do that.

[noxiousdog]

My thoughts are that, if something drops the market 10%, it's not going to stop at 10%. If the bottom hits at 179.99, I'll hit it at 185 on the way back up and count it as a lesson learned. If it keeps going down, then I'll be able to buy even more when the drop stops.

Why wouldn't it stop at 10%? It has happened many times.

Regardless, that's why I said go check. You might very well be right. Your risk/reward profile may make it work. But I'd go backtest it.

[LordMortis]

when oil reverses they will be great buys.

IMO, they are great buys now. When oil reverses, they will no longer be (as) great buys. But you know this.

I will say though, that I am starting to see more and more mention (and investing pundits are NEVER wrong!!) of longer term thinking about the effect of electric/hybrid/LNG vehicles on the profitability of the oil companies, and could that possibly be a complementary factor.

The absolute obvious factor here is OPEC trying to squeeze the US shale companies out of business. We'll see how long they can do that.

If I had money, I would think about buying now, weathering the further dip but happily collecting the high percentage dividends. MVO is currently projected to pay 27% (Annually) at its current price on January 23rd. I'd take that gamble if I could afford to.

[LawBeefaroni]

Not sure I buy that as a valid metric considering why oil is down. And it's not like XOM has outpaced oil, oil has fallen out under XOM.

I think oil stocks will continue to take a beating so it's not time yet but when oil reverses they will be great buys.

I don't think it matters why. Profits are directly related the price of oil. If the company isn't as profitable, it's not worth as much.

It matters why because oil is down so that producers can regain control over the [higher] price of oil.

If their gamble is wrong, yes, oil will stay down and XOM's profits will be reduced. But if it's right, production decreases and prices shoot up. At these oil prices, perhaps XOM is overvalued. I'm not counting on these oil prices to stay.

There are countless other factors, of course, but the main reason oil stocks are getting hammered is the price of oil.



It's kind of like hammering a company when their cash flow is down because they paid off debt.

[LawBeefaroni]

when oil reverses they will be great buys.

IMO, they are great buys now. When oil reverses, they will no longer be (as) great buys. But you know this.

I will say though, that I am starting to see more and more mention (and investing pundits are NEVER wrong!!) of longer term thinking about the effect of electric/hybrid/LNG vehicles on the profitability of the oil companies, and could that possibly be a complementary factor.

The absolute obvious factor here is OPEC trying to squeeze the US shale companies out of business. We'll see how long they can do that.

If I had money, I would think about buying now, weathering the further dip but happily collecting the high percentage dividends. MVO is currently projected to pay 27% (Annually) at its current price on January 23rd. I'd take that gamble if I could afford to.

Beware the yield trap. Back of the napkin, it looks like they've historically been around 10-12%. They'll probably cut to get back in that range if there is a sustained weakness in oil. If they cut, it will hurt share price quite a bit since they're a divy stock. Feedback loop.



However, I do like the idea. Too bad timing is paramount.

[LawBeefaroni]

I'm considering putting a stop-loss on my SPY shares at 180.

I hope you are joking. I have the curse! It all started with that damned house in 2003.

You haven't by chance been buying bitcoins, have you?

[LordMortis]

Beware the yield trap. Back of the napkin, it looks like they've historically been around 10-12%. They'll probably cut to get back in that range if there is a sustained weakness in oil. If they cut, it will hurt share price quite a bit since they're a divy stock. Feedback loop.



However, I do like the idea. Too bad timing is paramount.

It really matters not to me, as I have no money to put down. All of my IRA money for 21015 went into the tumbling Index funds as set it and forget it. This is just me studying what it is going on until I have enough money put away in savings to cover about two years worth of tight living expenses and then after that have enough to put in that $7 per trade isn't going to pretty much negate any effort to make money.

I'm not sure when that will be or if I will get antsy and cut my savings before it reaches my 2 years cheap living plus say 10,000. That level of savings could be another year even with a tight belt and no unforeseen expenses.

I'm considering putting a stop-loss on my SPY shares at 180.

I hope you are joking. I have the curse! It all started with that damned house in 2003.

You haven't by chance been buying bitcoins, have you?

While I'd like to reach the level where I could gamble with money, I think I'd much quicker put $1000 on the craps table than play at that type of gaming.

[noxiousdog]

It matters why because oil is down so that producers can regain control over the [higher] price of oil.

Saudi Arabia is the only one that wants production where it's at. I get the impression that they just want to export 9.5 bbl/day and don't particularly care what the price is. Market share is more important than pricing and profits.

If their gamble is wrong, yes, oil will stay down and XOM's profits will be reduced. But if it's right, production decreases and prices shoot up. At these oil prices, perhaps XOM is overvalued. I'm not counting on these oil prices to stay.

There are countless other factors, of course, but the main reason oil stocks are getting hammered is the price of oil.

That's fair. My guess is we aren't seeing $85/barrel for a long while though and once earnings start coming in you're going to see a sell off.

It's kind of like hammering a company when their cash flow is down because they paid off debt.

It's not like that at all. When AAPLs margins were off a tick they sold off like crazy. I think it's very likely the same happens to oil companies.

[LordMortis]

Not understanding ups and downs, I've watched my baby IRA hemorrhage for the last month and a half. I felt things were overpriced but I put in money anyway.

Now after a 3 or 4% drop since then, I'm feeling there are opportunities and I'm tempted to pull in savings I shouldn't for personal investing. I won't do it because my savings is meant to bail myself out of problems but I'm going to hate myself later when things turn around in a few months and I could be all like "I just made 5% on my money between January and April. That's like 15% a year in low risk investements. I am a genius. I am going to be the richest man in the world."

I hate feelings.

I am so not made for this.

[noxiousdog]

Not understanding ups and downs, I've watched my baby IRA hemorrhage for the last month and a half. I felt things were overpriced but I put in money anyway.

Now after a 3 or 4% drop since then, I'm feeling there are opportunities and I'm tempted to pull in savings I shouldn't for personal investing. I won't do it because my savings is meant to bail myself out of problems but I'm going to hate myself later when things turn around in a few months and I could be all like "I just made 5% on my money between January and April. That's like 15% a year in low risk investements. I am a genius. I am going to be the richest man in the world."

I hate feelings.

I am so not made for this.

Just say no.

[noxiousdog]

Re: oil. In the fool thread that followed one point that was brought up in favor of the oil companies was that there should be an ever increasing set of revenue from natural gas. As exporting becomes legal and processing capacity grows, that will be a huge boon for the industry. Both are major obstacles and will be measured in decades, not years, but that's part of investing.

[LawBeefaroni]

NEW YORK (MarketWatch) -- U.S. stocks were wading through losses on Thursday as investors grappled with disappointing earnings from large banks, mixed economic data and a surprise move by the Swiss National Bank that rocked currency markets.

The unexpected move to ditch its currency ceiling and implement a rate cut by SNB shook up currency, commodity and equity markets around the world, as the move created uncertainty among investors, who have grown accustomed to rely on central banks to prop up markets.

Traders observed that 'once-in-a-career' turbulence left many market participants in grips of panic for the first two hours after the announcement. Trading on Wall Street was choppy, with indexes dipping in and out of negative territory, though losses were fairly modest.

"Once-in-a-career". Well if they're right, the good news for LM is that you'll never see that again.

Too bad I'm long short EUR/USD in the paper account only.

[Carpet_pissr]

However, I do like the idea. Too bad timing is paramount.

Indeed.

MVO represents about 4% of my port. currently. It's also currently 48% down from when I bought it.

[LordMortis]

MVO represents about 4% of my port. currently. It's also currently 48% down from when I bought it.

That's part of what makes it look so good to me. It's seems to be have been riding around $15 since December. I can live that. If I had the money, I would have bit at $14.50. No appreciation or even slight depreciation at 27% dividends would work for me just fine. Though it will be interesting to see what happens as 23rd approaches and passes.

Someone remind me not to kick myself looking back at this from April.

[LawBeefaroni]

MVO represents about 4% of my port. currently. It's also currently 48% down from when I bought it.

That's part of what makes it look so good to me. It's seems to be have been riding around $15 since December. I can live that. If I had the money, I would have bit at $14.50. No appreciation or even slight depreciation at 27% dividends would work for me just fine. Though it will be interesting to see what happens as 23rd approaches and passes.

Someone remind me not to kick myself looking back at this from April.

The dividend isn't sustainable if oil says near these lows. You won't continue to get 27% if the stock doesn't appreciate. They'll drop the divy to stay near historical levels. If it appreciates substantially, the divy won't be 27% of the stock price (but it will be 27% or so of your purchase price, of course) so they may keep it close but decision time on that is coming up soon.

Here's the risk factor section from their most recent annual report (Filed march 2014). The whole risk section is required reading but here are highlights:

Prices of oil, natural gas and natural gas liquids fluctuate and lower prices could reduce proceeds to the trust and cash distributions to unitholders.

...

Although MV Partners was permitted to, and did enter into, hedge contracts relating to a portion of the oil volumes expected to be produced from the underlying properties, those hedge contracts expired in 2010, and MV Partners has not entered into any hedge contracts relating to oil volumes, and the terms of the conveyance of the net profits interest prohibit MV Partners from entering into hedging arrangements for the benefit of the trust. As a result, the amounts of cash distributions by the trust may fluctuate significantly as a result of changes in commodity prices because there will be no hedge contracts in place to reduce the effects of any changes in commodity prices.

And their most recent quarterly (a very quick read, worth the looksee).

[Carpet_pissr]

Someone remind me not to kick myself looking back at this from April.

At the risk of sounding like I am giving investing advice, just keep well in mind that the stock market does not perpetually go up.

Reading that sounds silly, and your first reaction is probably "well I KNOW that!", but for some reason, our weird little human brains have a lot of trouble with this concept when the shit hits the fan.

The market goes through peaks and valleys. The recommendation you hear most often is that that is precisely why a DIVERSIFIED portfolio works best...to weather the downs, but to be able to soar a little too. You go one extreme or the other, and you have much more risk that you have guessed....incorrectly (or timed a buy or sell incorrectly).

Just remember, when your investment portfolio ends down one day, two days, or two months, to fight the urge to sell, which is what my previous boss did. Worst. Investor. Ever. He would buy some HUGE amount of shares one day, tell me about it, then a few weeks later, I would ask him how ticker X was doing, and he would inevitably say "oh, I sold that - it started to tank and I panicked and sold!" I guess the upside there is that at least he recognized that he panicked (but he did it OVER and over again).

Also fortunately for him, he was extremely wealthy, and losing $75K at a time due to his horrible pattern of buy high/sell low, probably had zero affect on him financially.

[pr0ner]

So, my dad mentioned 3 ETFs to me the other day.

UUP and UDN track the strength of the US dollar. UUP goes up when the dollar goes up, UDN goes up when the dollar goes down.

UCO tracks oil prices. Obviously, it's down with the crash in oil.

I'm not overly comfortable playing with speculation ETFs without more info. Any of the more informed of you have any opinions here? My dad's confident that the dollar's gonna head back down soon and that oil is going to go back up, so he thinks I should invest in UDN and UCO. UCO fascinates me more; it's down to $6.87 a share right now (it was just under $25 3 months ago), and oil has to be near the bottom by now.

[GreenGoo]

I'm just throwing my completely uneducated opinion out here. Don't listen to me.

Tracking the dollar, and more importantly trying to predict the dollar's movement is not something I'd like to do. So many factors go into it, and you're in a somewhat unstable time right now anyway, that it would be too risky for my blood. Betting on the economy as a whole is not something I like to do.

That said, the UCO, assuming there aren't all sorts of caveats and quirks associated with it, would seem to be a no brainer, at least in the long medium term. If you're trying to get in and out, then again, I don't follow the industry enough to have an opinion on the short term, but medium term (assuming long term it will be replaced by other fuel sources) it should be all but guaranteed to return to previous value, and much higher.

This is purely uneducated opinion. Do not base decisions on anything I say.

[PLW]

I'm just throwing my completely uneducated opinion out here. Don't listen to me.

Tracking the dollar, and more importantly trying to predict the dollar's movement is not something I'd like to do. So many factors go into it, and you're in a somewhat unstable time right now anyway, that it would be too risky for my blood. Betting on the economy as a whole is not something I like to do.

I think the best use of those is as a hedge, not as a speculation. Say you think some firm/sector should be well positioned to do well, relative to the market as a whole, but you think it is really subject to exchange rate risk (will get killed with a strong dollar). Then you buy that stock but also buy the inverse of the ETF that tracks with the strength of the dollar. If you get those proportions right, you've offloaded the exchange rate risk and can keep the pure potential of the firm/sector.

[LawBeefaroni]

So, my dad mentioned 3 ETFs to me the other day.

UUP and UDN track the strength of the US dollar. UUP goes up when the dollar goes up, UDN goes up when the dollar goes down.

UCO tracks oil prices. Obviously, it's down with the crash in oil.

I'm not overly comfortable playing with speculation ETFs without more info. Any of the more informed of you have any opinions here? My dad's confident that the dollar's gonna head back down soon and that oil is going to go back up, so he thinks I should invest in UDN and UCO. UCO fascinates me more; it's down to $6.87 a share right now (it was just under $25 3 months ago), and oil has to be near the bottom by now.

Make sure you know what you're getting with fund that tracks the USDX. I'm not sure of the futures weight but I think it's Euro heavy. If your dad thinks the dollar is going to head back down, against what? I wouldn't be surprised to see near parity in the Euro.


Oil? Yeah, I think oil is bottoming but I've thought that for a month or so and it hasn't worked yet.

[LawBeefaroni]

I'm just throwing my completely uneducated opinion out here. Don't listen to me.

Tracking the dollar, and more importantly trying to predict the dollar's movement is not something I'd like to do. So many factors go into it, and you're in a somewhat unstable time right now anyway, that it would be too risky for my blood. Betting on the economy as a whole is not something I like to do.

I think the best use of those is as a hedge, not as a speculation. Say you think some firm/sector should be well positioned to do well, relative to the market as a whole, but you think it is really subject to exchange rate risk (will get killed with a strong dollar). Then you buy that stock but also buy the inverse of the ETF that tracks with the strength of the dollar. If you get those proportions right, you've offloaded the exchange rate risk and can keep the pure potential of the firm/sector.

Wouldn't you want something a bit more pure or something leveraged for a hedge though?

[pr0ner]

So, my dad mentioned 3 ETFs to me the other day.

UUP and UDN track the strength of the US dollar. UUP goes up when the dollar goes up, UDN goes up when the dollar goes down.

UCO tracks oil prices. Obviously, it's down with the crash in oil.

I'm not overly comfortable playing with speculation ETFs without more info. Any of the more informed of you have any opinions here? My dad's confident that the dollar's gonna head back down soon and that oil is going to go back up, so he thinks I should invest in UDN and UCO. UCO fascinates me more; it's down to $6.87 a share right now (it was just under $25 3 months ago), and oil has to be near the bottom by now.

Make sure you know what you're getting with fund that tracks the USDX. I'm not sure of the futures weight but I think it's Euro heavy. If your dad thinks the dollar is going to head back down, against what? I wouldn't be surprised to see near parity in the Euro.


Oil? Yeah, I think oil is bottoming but I've thought that for a month or so and it hasn't worked yet.

That's why tracking the dollar bugs me. I'd need to do more research into those funds.

Aren't oil prices cited worldwide in US dollars? Would a strengthening dollar have anything to do with the crash in the price of oil?

[LawBeefaroni]

DIS absolutely killing it. I have shares but didn't do the earnings option play this time around. Early bid for 2015 favorite with Star Wars coming.

PBR CEO steps down. Huge news although it was pretty much known about yesteday. 2016 calls.

And F back to the $15.80s. Shares.

Have some Apr AMD calls as well.


Not making me happy: INO.

[LordMortis]

And F back to the $15.80s. Shares.

Now if SPY would just get back up to around $207 (even minus the $1 they paid this last week) I would be about even from my initial dip in November.

I refuse to look at the Oil prices I didn't buy in Mid January. (I notice that gas has gone up about $.30 a gallon locally since then)

[Carpet_pissr]

DIS absolutely killing it. I have shares but didn't do the earnings option play this time around. Early bid for 2015 favorite with Star Wars coming.

PBR CEO steps down. Huge news although it was pretty much known about yesteday. 2016 calls.

And F back to the $15.80s. Shares.

Have some Apr AMD calls as well.


Not making me happy: INO.

Have not touched my Ford shares. Planning to hold them for a quite a while.

[LawBeefaroni]

AMD is really rumbling. Those Apr calls are up around 70% today.

[LordMortis]

Though this had an interesting diagram:

http://www.businessinsider.com/citi-bre ... es-2014-11

[LawBeefaroni]

Though this had an interesting diagram:

http://www.businessinsider.com/citi-bre ... es-2014-11

Since that was posted in November, we've come down over $25 a barrel and below the cost of at least half the companies on the chart.

[Zaxxon]

Makes the folks that caused the surge in SUV sales over the past few months look a little short-sighted.

[LawBeefaroni]

Makes the folks that caused the surge in SUV sales over the past few months look a little short-sighted.

When oil was touching $140, you couldn't give an SUV away. The perfect time to buy one. Now that trucks and SUVs are back, it's time to buy a high-mileage compact/EV.

You can't predict oil but if you need a car and can get one at a massive discount, take it.

[Zaxxon]

Yeah. That's a different situation, though. Here we have SUVs at no special discount, but gasoline at unsustainably low levels. So of course people see cheap gas and make a many-year purchase based on what's likely to be 6-18 months of cheapitude.

[LawBeefaroni]

Yeah. That's a different situation, though. Here we have SUVs at no special discount, but gasoline at unsustainably low levels. So of course people see cheap gas and make a many-year purchase based on what's likely to be 6-18 months of cheapitude.

That's my point. People buy based on the price of gas now, not the price of the vehicle or even price of gas in the future. Automakers take advantage of this and price to demand.

When people are buying up SUVs at premium prices because gas is cheap, that's the time to buy efficient cars at a discount. When people are buying up EVs/hybrids because gas is expensive and everyone is unloading SUVs for a loss, take advantage.

[Zaxxon]

That's my point. People buy based on the price of gas now, not the price of the vehicle or even price of gas in the future.

Yeah. People are dumb. Not that this is a surprise when it comes to vehicle acquisition. This is just a particularly egregious example.