I would like to have a Fresh segment on “How did you spend your NIL money”
60 percent equities? 25 percent bonds? 15 cash?
Bla hahahahahha
Have a feeling you’re not gonna like the answers, lol.
“I really like the confetti that Robinhood shows me, so I’m 90% options. But I want to be diversified, so I’m 10% in memecoins”
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All joking aside, I think Robinhood (and its like) have directly impacted option pricing in recent years. I suspect folks have smaller amounts of money there, and stocks are a lot less likely to split after getting to $80-100/share than they used to be, so its hard to buy a round lot of a lot of things. So they buy calls instead. Option pricing has been higher than it “should” be for years now.
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Lot of kids trade options but they dont directly affect options pricing. Small lots on Robinhood etc i mean
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For like SPY or GOOG or something, sure. But for low volume stuff like ETD or ALGT, its been dramatic.
Yea those stocks barely trade and options markets are wide
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For someone that works for an asset manager and has worked in finance for a decade, I’m remarkably unsophisticated when it comes to managing my own assets. Part of it is conservatism and preference for liquidity, some of it is tax sensitivity but I know I’m leaving money on the table. I’m also regulated so I can’t just trade willy nilly.
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Well Fresh Finance is an oxymoron at best
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50% equities (S&P 500 at 6,200 is expensive so lower than normal exposure, 1/2 equities hedged with at-the-money JAN or MAR S&P 500 puts), 10% preferreds/bonds (bad risk-reward with rates too low - staying short on yield curve), 40% cash. Will raise equity percentage after a 5 % pullback in S&P 500 and raise preferreds percentage if 10 year treasury approaches 4.60%.
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Prefferds meaning pay dividends?
I can also tell you. Paying premium for puts on the overall market might work for like 17 seconds. Buy put flies for distribution when vol is high
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Got a kid going to college this year and then another in two. How do I make, like, a million dollars in 3 months?
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Good plan. Just reverse the percentages.
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OnlyFans or transfer to UVa to play basketball.
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Yes, I would buy preferreds issued by financial institutions with distributions treated as qualified dividends, not ordinary income. I feel that you can still get some decent total returns without assuming too much credit risk.
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I would want to hedge some of my equity exposure and was just trying to keep it simple since most readers might not be familiar with various option strategies. I agree with you that with the VIX around 16 there are better ways to hedge than naked puts.
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Serious question. You are a mid-50’s investor, pretty solidly on track for retirement. Inherited a couple hundred grand from a relative that you just want to get a decent return on without a bunch of taxes. And you want safety because your entire retirement portfolio is 70/30. So MMFs or dividend stocks don’t look great. What do you do with it? Munis?
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Buy SPY. Thats it
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What about VOO?