Questions tagged [investment-strategies]
Discussions about different investment strategies, and their different outcomes.
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Do High Interest Savings Account (HISA) have an associated risk?
I have been chatting with a friend who asserts that all investments have an associated risk. In reference to this I suggested a High Interest Savings Account, claiming it has no risk. My friend ...
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Why are index funds not always the optimal strategy for investing?
I heard a claim that it is always the best strategy to invest money to the index fund. Why is the mistake in that sentence? Because I don't understand why there are investment advisers if we already ...
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Enter and Exit strategies to grow profit [duplicate]
The scenario is that a trader wants to trade just one stock through swing trading and take the profit. For example, the trader bought 50 shares of XYZ for the price $5. The stock went up to $7. He ...
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I cannot calculate this because I don't have the discount rate
What is the NPV of the following investment? Upfront, it requires an investment of 1598. Then, it generates a cash flow of 774 after one year, 659 after two years, and 623 after three years. After ...
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How to use short selling to safeguard or protect an investment?
I came across the following question:
Kumar has 100 shares of ABC Co. which he bought at $ 50. The current market price is
$ 140. Illustrate how Kumar using short selling can safeguard or protect his ...
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Financial pros and cons of having a rainy day fund in a savings account versus invested?
I used to have about 4 months of expenses in a savings account as a "rainy day fund" in case of emergencies.
The last year or so, though, I've switched to having a minimum of expenses (about ...
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Is the return rate equal to the discount rate if I buy a stock at its intrinsic value?
I know many value investors emphasized that we need to buy a stock with margin of safety since our estimation for intrinsic value is not precise. By this way, we can lose less when our estimation is ...
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Can a delta neutral synthetic position on bitcoin contracts make money?
This may be a basic question, but I am not sure if its already been answered, If I have a delta neutral(long 10x leverage, short on 10x leverage at same entry point) consisting of bitcoin contracts (...
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How can I invest or save savings bonds as they mature over 17 years?
I have a relatively large number of Series EE and Series I savings bonds that were given to me as gifts as a child to help pay for college. Fortunately, I did not need to use them and so now they are ...
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How to prepare for a war [closed]
I understand that the value of investments in debt, equity, paper currency, bonds, and in physical properties all go down if the country gets into a major war.
What is the best strategy to be prepared ...
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How to manage money with no expenses [closed]
Suppose a person has $165K in his checking account and has no expenses (e.g living with parents, home cooked meals, etc.).
What would be the best way to distribute/use this money? Should some of it be ...
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Is it a good idea to make one additional monthly payment to a mortgage?
This is an oversimplified scenario (the numbers, dates and interest rate may not be accurate as I am only asking about the strategy):
I have a mortgage with a monthly payment of $1,000 and it is due ...
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Why doesn't common investment advice include the idea of pulling out of the market during downturns?
The most common advice goes somewhat as follows:
Every month, save as much money as possible after paying down your high interest bills
Put that money into an index fund
Reinvest dividends
Enjoy your ...
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Better to withdraw from 401k or take out home equity loan for investment opportunity?
There is a fast-approaching investment opportunity (January) that I very strongly believe will have significant short-term (2x - 5x within a matter of months) and long term returns. I need ...
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Difference in de facto currency exposure
Suppose my main currency is SEK and that I want exposure to EM MSCI. Then I could
A) buy a Swedish passive fund in SEK that is exposed to EM MSCI
or
B) Exchange my SEK for EUR or Dollars and then buy ...
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How to Calculate Return of Multi Positional Trading Strategy
i have a trading strategy that buy multiple stocks in same time and sell another time. I want to calculate return of this strategy. Below table shows my positions that opened and closed.
From above to ...
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Should I switch my investment from one mutual fund to other? What should be the mathematics behind it?
Take an example of two mutual funds: A and B.
For simplicity, following are assumptions:
Both funds always perform exactly same (same fall or same growth depending the direction of market).
Let us ...
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Can buying mutual funds that performed best in the past 10 years work?
It seems one method to invest, without using much brain power, is to say, at the beginning of each month, if we have $500 to invest, then just look at the list of the best performing mutual funds over ...
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What do VCs or angel investors really do for their invested businesses? [closed]
I have seen angel investors / venture capitalists on shows like 'Shark Tank' who make claims about how they will benefit the businesses the invest in, more than just that investment.
They make claims ...
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Is it possible to protect against investors stealing business ideas?
Think person A has a great software business idea. He also knows software programming and converts his idea to a mobile application. Then he needs to raise some money to launch the application, do ...
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Is it possible for a non-citizen nor GC holder do crowdfunding inside the US?
I am an international student in the US. I have an idea and like to launch a company on that. I know I don't have a work permission but also know I can register a company and invest in it.
So can I ...
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How trustworthy are the strategies in “What works on Wall Street”?
I’m studying up on the book What Works on Wall Street for equity investments strategies.
While the book is very insightful, essentially it seems to be a system of filtering (say by market cap or price ...
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If I buy a property that has a home on it and subdivide the land and sell off the home for less than I bought it for, is that a capital loss?
I want to buy a home that sits on 1 acre for $1m (in the USA). I want to subdivide the land into two pieces and keep the new 0.5 acre parcel to build a home on for me. I have no interest in keeping ...
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Is it better to put money in stocks, bonds, and CDs than to buy a house? [closed]
Do all of these things either alone or together outpace the increase in value of a house?
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SMA2 High Low Strategy
I wonder if there is any strategy to buy and sell stocks based on the SMA (Low) and SMA (High) of two days. I have noticed that the greater range price remains between the low of the previous day and ...
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Which one is better for credit score: use and charge the card a lot or keep money on them and don't spend much?
If we have a credit card with 1000, 2000, 5000 of dollars, is it a good idea to use it daily like spend 30%-50% of the money per day and recharging the card at the same day just to increase the credit ...
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How many accounts do I need to trade Stocks. Future contracts, Cryptocurrencies, Forex, Etc.?
I am a new comer in the US and I want to start my investment here. But the first question is how many brokerage accounts do I need if I want to do and manage the investment on all of the markets? In ...
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I want to learn all about money, business models so that I can reshape my future startup into global tech giant? [closed]
I'm currently 17 years old. I have a very brilliant idea of doing some startup in the future and I do believe I can really take it to a global level. But most often than not what I see in the world is ...
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Derive Initial investment based on Compounded returns
I know the investment instruments, their average yearly returns, the duration of investment and the target corpus. Based on the target corpus and the average returns, I want to reverse engineer and ...
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Backtesting: how to separate the predictive power of a trading strategy from the market trend
I noticed that some traders use backtesting to evaluate their trading strategies. What I don't understand is: how do they separate the predictive power of their trading strategy from the general ...
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Is there a threshold (in effort, or capital) beyond which it makes sense to be an active investor?
According to Benjamin Graham's The Intelligent Investor one could define an aggressive investor in accordance with the following line (not a verbatim extract from the book):
The difference between a ...
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Comparison of expected returns from index funds and single shares
I shall start by saying I know little about markets, investing or gambling, but I do know a little bit about probability. This question is prompted by comments to this question, such as "As a ...
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Is backtesting only for disproving trading strategies rather than "proving" them?
I sometimes read articles where author X presents a new trading strategy, and then shows backtest results to "prove" that the trading strategy was more profitable than some chosen benchmark. ...
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Trading strategy with high probability of small profits and low probability of complete loss
What are some trading strategies that have high probability of small profits and low probability of catastrophic loss? I believe there is an academic term to describe a trading system that shows small ...
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What are the disadvantages of copying the consensus stock picks of hedge funds?
Suppose I have made a list of hedge funds that are known to successfully follow a particular style of longer-term investing (e.g. long-term momentum, or value, or ...). I notice that this group of ...
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Can rent from a UK property be moved into an investment account if the owner lives abroad?
TL;DR: I want to rent my house out while I live in another country for some years. I'd like the rent to go into a stocks and shares investment, to grow. Is this allowed, in the UK?
I've been in my ...
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Strategies For Generating 25-Year Revenue Stream (Instead of Mortgage Down payment)
I'm about to buy a house. Interest rates are low and I think it might make sense to invest the money I have, instead of buying cash/making a large down payment.
I expect to live in this house for 25 ...
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Why is it common to selloff SPAC shares just before merger?
There is a company I am familiar with that is the target of an SPAC. I'm unfamiliar with investing in SPACs, but what I have learned is that more often than not, the price of the ticker drops after ...
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Can my sibling double his portion of our inherited property by buying us out and then selling?
I have 2 siblings for a total of 3 of us. My father lived in a home worth $300,000. However, we inherited 2 million split 3 ways. My brother wants the property, and buy us out. When thinking it ...
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Formula like Kelly criterion for choosing how much of an investment to liquidate?
I made a few investments, and surprise, surprise, a few of them shot up in value. Now I'm faced with the dilemma of the greedy: do I sell now and capitalize on existing profits, or do I wait, risking ...
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Use-cases for stop-limit order where stop price is lower than limit price on Sell Order
I understand the typical use-cases mentioned on investopedia etc. for sell orders using stop-limit orders where the limit price is lower than the stop price e.g.,
Type: Sell
Current Price: 50$
Stop ...
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Can I reverse flip a bad low win rate trading strategy?
Let's say I have designed a terrible trading strategy with a poor win rate of 20% or less. We are not risking more than 1% in a single trade and an excellent risk management and position sizing are in ...
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(stock exit strategy) place two different exit strategies simultaneously?
Say I bought a stock @ $100. According to my exit profit strategy, I'd want to sell it @ $150 so I could make a stop order @ $150 (correct me if that's wrong). But if I also want an exit loss strategy ...
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Life insurance and its risks on the insurer and the insured
Consider a life insurance contract designed for independent workers who have little salary and are afraid to lose their retirement opportunity: for example, they will always be obliged to work even ...
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What's stopping me "day-trade" mutual funds?
I invest monthly into several funds, such as this one. Last week, I noticed a new fund I'd just invested a small amount into ($100) had grown by 12% in one week (now worth $112).
I investigated the ...
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Diversifying inter sector or intra sectors. What should be considered?
I have been investing (softly) in stocks for the last 2 years or so. I am not an experienced stock investor but it seems to me that there is a consensus that some degree of diversification is a safer ...
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Average stock value calculation
Let's say I buy 1000 shares of ABC for 10$ each.
Avg. Cost : 10$
Six months later I sell 500 shares for 12$ each.
Total earnings: 1000$
Question: should I include the earnings in the formula of the ...
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If I own a lot of one company's stock via vested RSUs should I diversify?
I worked for Amazon for several years and accumulated a decent amount of RSUs that have vested, the value of the stocks is quite significant (for me). Is it a good idea for me to continue to hold all ...
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How much and when to sell when I use dollar cost average?
I want to start investing in Bitcoins (but the question applies to other assets as well) using a simple dollar cost average strategy. What I do not understand about this strategy is how and when I ...
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Investing in index fund vs. investing to large-cap companies directly [duplicate]
I'm trying to understand the upsides/downsides of investing to an index fund vs. investing directly to stocks of some best-known and well-established large-cap companies. Every single article on ...
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