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Current gambles, all of which turned out fairly decent so far:

BTC -> Bought in 2019/2020, in at $432, now at $1,360.
ETH -> Bought in 2019/2020, in at $348, now at $1,366.
JETS -> Bought in March 2020 (obviously Airlines can't go under, right?), in at $318, now at $474.

Fingers crossed the good luck carries forward.
 

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Discussion Starter #42
Dalio doesn't debate the morality. He says, when money exists, it goes into certain places for storage.

The traditional places are real estate, business equity / stocks, bonds, commodities.

It's very possible that crypto coins will become a place that wealth is stored, but it's a wee bit premature to make that assumption after they've only existed for about 5 years. The above list of traditional "wealth storage" places have existed for several hundred years, and in case of commodities, several thousand years.

We live in a society that fetishizes high tech, so that's why people are very quick to assume that crypto coins will stick around as a legit thing. It's just way too early to tell. I'm someone who works in cryptography and there are a lot of potential difficulties with these things. Tech fetishism makes society look with twinkling eyes at anything that's complex and whiz-bang, and it clouds judgement.
 

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Dalio doesn't debate the morality. He says, when money exists, it goes into certain places for storage.
So if I want to store my money in real estate, I can buy a house from you. That money is transferred from me to you. How is that money stored in real estate?

The hedge funds and derivatives markets have manipulated finances and money so much that it also seems to go whiz bang and make eyes twinkle and glaze over

Besides a controlled circulation - DeFi removes the complex whiz-bang financial intermediary hedge waving manipulation that clouds judgement. Code is law.
 

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The money is stored in the house as future value because someone will alwasy buy the house for a place to live or you can rent it out for income.
 

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Discussion Starter #45
@m3s I'm pretty sure that it's been a human custom for at least several thousand years to "preserve wealth" in the form of property or real estate. I'm not really sure what to tell you if you disagree that real estate is a way to store wealth.

Maybe we are talking about different things, but I am referring to this idea: I do some work or provide something of value to someone. They pay me somehow, perhaps in seashells, or goats. I now have more goats than I used to, so I am undeniably wealthier than before.

How do I hold onto that wealth? I might find someone who has a house or farm for sale, and I buy that real estate using my excess goats. I am now goat-poor, but house-rich.

The money has been stored in the house. Later I have children. I pass the house down to my children when I die. The house might stay in the family for a long time.

The house / real estate preserves the wealth of the family. And human history has shown that it DOES survive inflation, currency devaluation, changes of government, revolutions, money-printing, etc.
 

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James I think you are confusing wealth with cash. At least, I think that's the point m3s is trying to make.
Yes, you can store wealth in a house/real estate. But the cash is just a means of purchasing the house. You earn the cash, you give it to the house seller. Now he has the cash. Where does the seller store the cash?
 

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I was questioning the comment of how money goes into places of storage.

A lot of financial experts seems to have these overly complicated explanations for inflation. In my mind when you increase the circulating supply of money it dilutes its value. I don't see how money can be stored in assets because somebody just receives the cash for those assets to buy something else

Printing USD is great for the US because they get to spend it first. 80% of the world uses USD as a reserve currency and they are the suckers
 

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The irony is that people who complain that paper money is not really worth anything, back bitcoin, which is also worth nothing real.
i understand the sentiment. it's a little strong for me. bitcoin is a proof of work system with a ledger that (in its present state) cannot be re-written (e.g., to double spend) without enormous expenditure of electricity (and capital investment in mining equipment). in that sense, like gold, it is a measure of stored energy that cannot be easily counterfeited. of course bitcoin doesn't survive without a healthy ecosystem of miners and validating nodes, whereas gold, once extracted and refined, is low entropy and duration risk free with no "energy carry" (other than the need for physical storage and security). a house suffers from illiquidity and costs of carry in the form of property taxes, maintenance, etc., and is to some extent tied to the economic fortunes of its location. other stores of value have their own risks and benefits. ultimately there are no refunds on time spent, so it makes sense to me that humans would look for (and try to invent) ways to store human energy spent over time into the future.

Dalio (unequivocally dismissive of bitcoin in the past) coming out with a detailed, considered paper on the idea of bitcoin as a long duration option on an uncertain future is very interesting to me. options often expire worthless -- nothing wrong with that. one can manage these sorts of risks by position sizing or using barbell strategies.
 

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I started my stock portfolio in April 2020, so it's still very, very young and I'm currently just playing around and trying things because it's only a 5-figure portfolio.

I like to have different ways to view my portfolio, so I did different categorisations.

One of those categorisations is related to my confidence, expected growth and risk level.

I used 4 labels :
  1. Growth. Stocks I'm pretty confident they will provide some stable growth. I plan to hold these on the long term.
  2. Contrarian. Stocks I bought when beaten down and I was confident they would provide nice growth from their recovery. I plan to hold these until I'm happy with their recovery.
  3. Bet. Stocks that I expect to make a move, but that still haven't proven themselves yet. I'm watching these pretty closely because I may sell them if things turn south.
  4. Momentum. Stocks which were caught in a momentum move. These could be "promoted" to growth at some point or "demoted" to bet if they stop moving for a while.
I have :
  • 53% categorised "growth"
  • 18% categorised "contrarian"
  • 16% categorised "bet"
  • 13% categorised "momentum"
 

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Discussion Starter #50
Dalio (unequivocally dismissive of bitcoin in the past) coming out with a detailed, considered paper on the idea of bitcoin as a long duration option on an uncertain future is very interesting to me. options often expire worthless -- nothing wrong with that. one can manage these sorts of risks by position sizing or using barbell strategies.
Yup, and thanks for posting Dalio's letter. I agree with Dalio. The coins might turn into a legit asset class. It's just way too early to tell how it will play out. They could turn out to be a flash in the pan, or something that sticks around.

Even if they stick around, how their price moves over time remains to be seen. Just because something is rare and has limited supply, does not mean its price is guaranteed to go up strongly over the long term. Nor is money-printing guaranteed to help it.

Here's the 30 year chart of platinum. This is the kind of thing that could happen to bitcoin... it may still be a thing 30 years from now, but that doesn't necessarily make it a great investment. Platinum is useful, it's rare, and it's very cool but over 30 years, the performance is worse than stocks and bonds.

21220
 

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Discussion Starter #51
Serious question for everyone. Why shouldn't every portfolio contain some platinum?

I don't know why we'd jump to adding Bitcoin to the portfolio, when platinum is so much better established. As you can see from the chart, it responds powerfully during high inflation and money-printing. It's extremely rare and has very limited supply.
 

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I don't know why we'd jump to adding Bitcoin to the portfolio, when platinum is so much better established. As you can see from the chart, it responds powerfully during high inflation and money-printing. It's extremely rare and has very limited supply.
Personally I'm not interested in precious metals or bitcoin. I like the idea of hedging inflation but there is little utility and I don't like mining something just to bury it somewhere

Something like ethereum or cardano could be a store of value (inflation hedge) commodity (decentralized processing) medium of exchange (fast, cheap, secure). Then DeFi can bank more efficiently without intermediaries and do far more than legacy finance. This will be the major disruption of the coming decade imo and is far more disruptive than recent social media/sharing economy. Of course there will be growing pains and downsides like all tech but I don't miss lining up for the tellers.

Eventually the derivatives market will also move to a blockchain. The derivatives market is quadrillions. Precious metals and bitcoin combined are insignificant by comparison.
 

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The Loewen Group - Everybody has to die sometimes and the funeral business is recession proof. Its stock chart was practically a straight line going up for ten years. And they were acquiring other funeral homes, so they are growing and getting dominant. Wrong. They over-extended themselves and went bankrupt.
Oh ya Loewen Group! . Just checked my records. Bought 200 @ 11.00 in 1989, shares split 2:1 and I sold in 1996 400 shs @ $40.00 If memory serves it was as high as 65. (A business model similar to BYD - auto group) What killed Loewen was it got sued for 12M down in Memphis and the jury awarded 500M to punish them. Their business was to buy up Ma and Pop funeral businesses and standardize them leaving the Ma and Pop in place to run them. But the Ma & Pop in Memphis figured they got screwed by Loewen and started the suit for as I say about 12M and the jury came back and awarded 500M. (Remember this was in the mid 90's $$$ wise.)

I did have a stinker during that time - Noma lighting (Think xmas lights)! But still hold RY and TD from those days !
 

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Serious question for everyone. Why shouldn't every portfolio contain some platinum?

I don't know why we'd jump to adding Bitcoin to the portfolio, when platinum is so much better established. As you can see from the chart, it responds powerfully during high inflation and money-printing. It's extremely rare and has very limited supply.
my man, this is the gambling portfolios thread, not the bedrock elements of every portfolio thread. but, to answer your question seriously -- i think the case against platinum would go something like (1) it does not have the network effect of say gold, (2) it is much harder to work (bad for coinage, hard to develop a network effect as a monetary metal), (3) it has many industrial uses (less value derived from monetary premium) and (4) proof is in the pudding - we can see from its price history that it's probably a trade rather than a long term hold.

my case for bitcoin as an asymmetric 'gamble' is partly based on the fact that we only have 12 years of history for it (only 11 of which have price history), so we don't know whether its network effect will become like gold's (or, if we really want to stretch our imaginations, US treasuries) or if it will expire worthless.

what's interesting about the Dalio piece for me is it shows this thing has probably gone beyond beanie babies and tulip bulbs -- a common comparison (and in my opinion lazy but we don't have to debate that) from its last big speculative bubble in 2017-2018. that was i think the third time it crashed 80% and now it has done another round trip and is close to doubling the 2017 high. you don't really hear the tulip chatter much anymore. maybe it'll come back. people don't like the volatility, but do we really think stocks and bonds would be steady-as-she-goes without all the volatility dampening manipulations applied to those markets like circuit breakers and central bank supplied liquidity? anyway that's a sidebar. my point is bitcoin has a wide distribution of possible outcomes but going to zero seems increasingly like it wont be one of them. it's an interesting signpost to me even if it it might seem inconsequential with say 80% loss still on the table.
 

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Discussion Starter #55
Gambling update

AAL , $560 [little change]
Bitcoin, $660 [little change]
BBD.B , $820 [little change]
AMC puts, $230

Going short AMC ... I bought some put options on AMC. Currently the stock trades at $8.67 and I bought a March expiration put contract at $0.90. This is insanely risky, and I figure that if AMC stays above $7 that I will lose all this money. However if AMC falls significantly, more than 20% in the coming days, I think this contract should increase significantly.
 

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Discussion Starter #56
Going short AMC ... I bought some put options on AMC. Currently the stock trades at $8.67 and I bought a March expiration put contract at $0.90. This is insanely risky, and I figure that if AMC stays above $7 that I will lose all this money. However if AMC falls significantly, more than 20% in the coming days, I think this contract should increase significantly.
And now I'm being reminded about how tricky these options are. AMC is now down 12% from where I opened this position (which is good for me). You'd think my put options would have gained value, but in fact my puts are only up 2%. This is because I paid a huge volatility premium for the options.
 

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I invest mostly into ETFs with low MER. I have allocated around 10% of my portfolio to what I would call "Experimental Stocks". These are stocks that I have done a bit of research but not too much. It would be my gambling stocks i would say. Some of these are:

-15 shares of bb.to bought at $6.30/share (I kinda wished i sold them at the recent peak)
-5 shares of QBTC.to
-15 shares of QETH.U
-15 stocks of well.to
-15 stocks of cineplex at around $12/share
-10 shares of NKLA at $18/share

I feel like these satisfy my gambling sweet tooth. I am looking for a good penny stock as well but I will see if I can find something.
 

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I guess I'm still gambling because I bought more CGL.C today on a dip. Gold can go both ways.
1) If investors get nervous about all that new deficit in Biden's relief package, the USD will plummet and gold will go up;
or
2) Investors may see Biden's relief package as a calming effect to stabilize the economy and the markets so gold will continue downward.
 

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Discussion Starter #59
I decided to hold onto my AMC puts. The stock has been steadily dropping from where I entered, and my puts are steadily gaining value as well. I like the way the trade is playing out so far. I have a price target in mind so I'm hoping to see the stock drop that low.

I guess I'm still gambling because I bought more CGL.C today on a dip. Gold can go both ways.
It's not gambling if it's part of your long term asset allocation plan. I bought more precious metals today, part of my 20% allocation target.
 

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My gambling is for all to see Whoops! PRKR but i bought a bunch at .22 cents and currently up 1022% on one account and down 63% on the other.Overall i have $13000 in it and up $4000 but holy **** a long 8 year ride lol
 
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