Money System - What Are You Investing That's Getting 5% Return?

[Maxjohan]

I admit, I'm probably going to throw in a few $K on that UWTI ETN Cyriex mentioned. Seems to have a very good upside when the market starts going the other direction. And I have been having my eyes on it. I think we will see oil at an all time low, before the market starts moving in the other direction. So I will buy then and ride it for 18 months. Hopefully, I can make some money.

If it doesn't hit all time low. Then I'm not going to go in. Simple as that.

 

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[fhs8]

There are teams of people with decades of experience analyzing everything about companies to try and determine fair market value. Just looking at dividends to determine whether or not you're paying too much isn't too wise. If you don't know what a 10-K or 10-Q is then you should probably just invest in a basket of stocks to avoid single stock risk.

I admit, I'm probably going to throw in a few $K on that UWTI ETN Cyriex mentioned. Seems to have a very good upside when the market starts going the other direction. And I have been having my eyes on it. I think we will see oil on an all time low, before the market starts moving in the other direction. So I will buy then and ride it for 18 months. Hopefully, I can make some money.

If it doesn't hit all time low. Then I'm not going to go in. Simple as that.

OMG seriously? Going in a 3x etf/etn is one of the worst things you can do. Please tell me you know what the futures curve/contango is? Futures are a zero sum game in theory. If oil goes down then contango typically increases thus offsetting the possible gains probability wise due to it going down.

The nail in the coffin is the effect of compounding. I would avoid UWTI for this very reason.
If let's say the index UWTI follow goes down by 10% a day and then goes up 11% the next day. The index is break even. This is because 1 * 0.9 * 1.11 = 1. However UWTI would go down 30% one day and up 33% the next. So UWTI would be 1 * 0.7 * 1.33 = 0.931. UWTI would have lost 6.9% but the index would be flat.

Try looking at VWO. it looks pretty cheap right now and it has a low expense ratio.

 

[Maxjohan]

OMG seriously? Going in a 3x etf/etn is one of the worst things you can do. Please tell me you know what the futures curve/contango is?

No, I'm not going in when the price is going down. I will try to move in when it's on the way up. If I buy $2... it goes down to $1 and I don't sell, I haven't lost any money. Then I could sell when it is at say $8. If it hits those figures. Maybe it takes three months, so what?

I don't care about Contango. As I am going to hold for probably more than a year. And during two days, it usually doesn't fluctuate that much.

Compounding sounds like some b.s., some bullshitter made up to mislead the less knowing. Every time something goes down in price, by a bigger margin. It needs more % increase to go up to same or higher number. This is nothing new at all. Simple math. I learned this in junior high. So just because of this, nobody should be trading stocks, ETF, ETN, Gold, Currency etc... Or?

Compounding affects everything you are trading. Just so you know.

Nah, not that interested in VWO.

 

[MJ DeMarco]

I don't care about Contango.

Then you don't care about your money being systematically pick-pocketed from your hands into some financial conglomerate whose manager lives in a $20M Greenwich Connecticut mansion.

He says thank you.

 

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[Maxjohan]

Then you don't care about your money being systematically pick-pocketed from your hands into some financial conglomerate whose manager lives in a $20M Greenwich Connecticut mansion.

Well, Contango is for two days. In this market. I buy the UWTI. Two days later I get it. So it may fluctuate maybe 0.20-0.30 at most. But the real money is made beyond those two days. Holding out for months.

It's the price you pay. To play. I guess.

 

[fhs8]

Well, Contango is for two days. In this market. I buy the UWTI. Two days later I get it. So it may fluctuate maybe 0.20-0.30 at most. But the real money is made beyond those two days. Holding out for months.

It's the price you pay. To play. I guess.

I don't think you fully grasp what contango is. If the spot crude oil price stays flat and there is contango then the index UWTI follows should decrease. It doesn't matter if it's over two days or over two years. How many cents it fluctuates doesn't matter only percentages do for the NAV of UWTI.

Maybe you should look at a 10 year chart of the index being followed.
http://us.spindices.com/indices/commodities/sp-gsci-crude-oil

Notice how it's pretty much flat from 2009 to 2014 even though spot oil went from $40 to $100? That's contango. It doesn't matter if oil is headed to $500. If there is a large enough contango you can still lose money.

 

[Maxjohan]

Notice how it's pretty much flat from 2009 to 2014 even though spot oil went from $40 to $100? That's contango. It doesn't matter if oil is headed to $500. If there is a large enough contango you can still lose money.

Notice how UWTI isn't going flat right now. That's what I am betting on. That it will go back up. Even though that index you posted as you said is pretty much flat for like four years. So, I'm not playing the index here, does that make sense?

This is WTI during the last 10 years. Doesn't look flat to me. I think there are different types of crude oil indexes to follow. If I've understood it right?
http://www.nasdaq.com/markets/crude-oil.aspx?timeframe=10y

This is brent crude oil, by the way:
http://us.spindices.com/indices/commodities/sp-gsci-brent-crude

 

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[Captain Jack]

Not naive. I've seen it month after month. I actually fudged the numbers. It's been around 25% ROI per month. And he's one of my father's best friends, who we trust whole-heartedly. You can believe what you want. I know it sounds preposterous. I just hope I can hire this guy before he retires (which will be soon).

I realize that I'm necro-ing an old(er) thread here, but this needs to be said.

Have you ever watched the TV show "American Greed"? Has your father tried taking out money from this "financial advisor"? With that kind of return, it's very likely that your father is investing into a ponzi scheme. If I were you, I would not invest money into this unless that guy is willing to provide you with a detailed breakdown of how he makes his money. Either that or invest a small amount of money that you'd be okay with losing. Basically, treat it as speculation money.

Also, just because he's best friends with your father does not mean that he won't rip him off. Many of these fraudsters rip off their own families (spouses, children, parents, etc.). No one is immune.

 

[Draven Grey]

I realize that I'm necro-ing an old(er) thread here, but this needs to be said.

Have you ever watched the TV show "American Greed"? Has your father tried taking out money from this "financial advisor"? With that kind of return, it's very likely that your father is investing into a ponzi scheme. If I were you, I would not invest money into this unless that guy is willing to provide you with a detailed breakdown of how he makes his money. Either that or invest a small amount of money that you'd be okay with losing. Basically, treat it as speculation money.

Also, just because he's best friends with your father does not mean that he won't rip him off. Many of these fraudsters rip off their own families (spouses, children, parents, etc.). No one is immune.

Sorry you feel that way. I appreciate your concern, but I truly believe it's unwarranted in this case. And yes, my parents have lived off their investments for a couple of years.

 

[Phones]

I'm upping my P2P portfolio to cover my monthly expenses (around 500€) in the next couple of months.

30% at Mintos.com
30% at Twino.eu
40% at Estateguru.co

All the above are currently at 11-12% rates, around 10% after tax.

IMO, these 3 markets are the best and safest players ATM on the EU market.

 

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[NYCGoblin]

I'm upping my P2P portfolio to cover my monthly expenses (around 500€) in the next couple of months.

30% at Mintos.com
30% at Twino.eu
40% at Estateguru.co

All the above are currently at 11-12% rates, around 10% after tax.

IMO, these 3 markets are the best and safest players ATM on the EU market.

So going up to 50K in now between those three? How long has your account been active while achieving that return?

 

[Vigilante]

I was talking with the bank the other day, and for kicks I asked her what the current rate was on a 6 month CD for $50,000.

Her answer? The bank was offering .05%.

1/2 of 1/2 of 1%.

 

[Phones]

So going up to 50K in now between those three? How long has your account been active while achieving that return?

Been Active on Mintos I think for 1.5 years now, but had to use the money there to fund inventory.

On Twino I've been also for around 1 year. These returns are real/fixed, because both these platforms offer buyback guarantee. The risk is the platform going bankrupt or, in case of Mintos, the loan originators (they are the ones providing the buyback).

No experience with estateguru, but they are RE backed loans and they have been active for a while too

 

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[GlobalWealth]

I was talking with the bank the other day, and for kicks I asked her what the current rate was on a 6 month CD for $50,000.

Her answer? The bank was offering .05%.

1/2 of 1/2 of 1%.

This is why I have a safe

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[Bobby-H]

I'm upping my P2P portfolio to cover my monthly expenses (around 500€) in the next couple of months.

30% at Mintos.com
30% at Twino.eu
40% at Estateguru.co

All the above are currently at 11-12% rates, around 10% after tax.

IMO, these 3 markets are the best and safest players ATM on the EU market.

Does anyone in the US invest in these? Is an EU account required to invest in those?

 

[GlobalWealth]

Does anyone in the US invest in these? Is an EU account required to invest in those?

I am American but not in the US. I do. And yes you need an EU acct.

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[MakeItHappen]

I am American but not in the US. I do. And yes you need an EU acct.

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How much of your portfolio is in P2P and across how many platforms if I may ask?

 

[GlobalWealth]

How much of your portfolio is in P2P and across how many platforms if I may ask?

As this is a public forum I dont like sharing this openly.

But I can say I have a decent amount and I add to it monthly.

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[Ubermensch]

A hustler invests in hustles that make way more than 5% ROI.

If you're not getting double-digit returns, why bother.

 

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[GlobalWealth]

A hustler invests in hustles that make way more than 5% ROI.

If you're not getting double-digit returns, why bother.

I partly disagree here.

A hustler focuses his energy on what gives a high return.

Excess cash can be reinvested with minimal input for lower yield because of low risk and hands off.

For example. If you earn $30k/m but only spend $10k, do you want to invest the $20k every month in a business that will inevitably divert your focus from the thing that brings in $30k/m?

If you are rational the answer is no. Take that $20k/m and dump it in investments safely paying 5-10% pa and watch your wealth compound without adding more workload.


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[Ubermensch]

...do you want to invest the $20k every month in a business that will inevitably divert your focus from the thing that brings in $30k/m?

If you are rational the answer is no. Take that $20k/m and dump it in investments safely paying 5-10% pa and watch your wealth compound without adding more workload.

You (falsely?) presume that investing in a business will inevitably divert my focus from the primary source of income.

 

[GlobalWealth]

You (falsely?) presume that investing in a business will inevitably divert my focus from the primary source of income.

I don't presume to know you and your mentality.

But I've been involved in lots of businesses and investment deals. And I know reality.

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[Ubermensch]

Some people don't want to hustle. They want to live off the money they've already made and spend all their time doing something they enjoy more than hustling... For many, that's the ultimate goal...

Most people don't have the wealth goals I have either.

You guys are missing my point.

 

[Ubermensch]

Why is your goal 5%?

...that's not even keeping up with inflation.

Lol, word.

 

[axiom]

Some people don't want to hustle. They want to live off the money they've already made and spend all their time doing something they enjoy more than hustling... For many, that's the ultimate goal...

I mean to each their own but I would get horribly bored if I just lived off of a 5% ROI.

Constant forward motion. Constant satisfaction from a day of hard work.

I find it much more fun to consistently take the big risks for a chance at the much larger rewards.

 

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[Ubermensch]

@Cyriex

What you think?

 

[Ubermensch]

I don't presume to know you and your mentality.

But I've been involved in lots of businesses and investment deals. And I know reality.

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I have an exponential mentality, my good man.

 

[GlobalWealth]

I have an exponential mentality, my good man.

Just out of curiosity - how old are you?

I ask because we tend to have different goals at different stages of our lives.

I am 42. I have had lots of business successes. And probably even more business failures.

As @JScott said I also don't consider the accumulation of zeros on my bank statement the goal.

I prefer the quality of life money affords. I am not hugely wealthy but I have enough passive income from enough different sources to not have to bust my a$$ every day of I don't want.

My 20s were different though. It was all about accumulation. Mostly ego driven in my case.

Nowadays its a much different story. I worked about 8 hours last week. But my income did not suffer. Did I make exponential money? No. But I made more than I could spend.

And my 5-10% yields continue to compound.

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[illmasterj]

I look at it as the safety net that allows you to take greater risks. If you sell the fastlane business and invest 100% of that into the next business, there is the chance of losing the lot. Why not invest a portion to cover your living expenses so you literally never have to be concerned about eating ramen while living in your car again?

How many people can't take the jump to fastlane from their slowlane job because they have a mortgage, have kids to feed, etc. A portion of well invested money for income removes a lot of excuses.

 

[Deleted35442]

@Cyriex

What you think?

I think this. I've heard of far too many people make millions but then lose it because they didn't plan accordingly. I have a good friend of mine that was living cozy with eight figures in Los Angeles. He went all in on Lehman Brothers on a rather....Inopportune time you wanted to be going all in on Lehman Brothers (08). He went broke and his business that got him that money went under. He was not prepared and now he's starting over.

Advice I give people is once they have their first million, let it grow in a conservative 5-10% return environment. High net worth guys that invest in hedge funds are actually happy if you tell them they can get these kinds of returns. We have unsustainable pension funds that are bleeding for this kind of alpha.

When these guys have idle money they put it everywhere. Angel investing and venture rounds, ETFs, you name it. One million is my safety net. Despite the draconian levels of inflation we face, if you made 5% per year on a million per year you could live like a King in SE Asia or South Am. Would I be just content with that? F*ck no. But consider this contingency planning. The question is, what is your number? Ten million? Hundred million? Billion? Lots of guys here have simple wealth goals. They don't want to be broke and don't want to work again. You and I @Ubermensch are the ones that want even more.

Question for @GlobalWealth do you ever look into smaller international banks usually only operating in their country of origin? Deposit rates globally are obviously much more attractive than here even after you account for inflation differences and the risk of that financial institution. Stress tests I'd imagine would look much different than US banks. Are only citizens of these countries able to put money there? I heard not all of them allow for American clients. Additionally I've heard you can get some exposure through HSBC's Expat. Global rates: http://www.deposits.org/world-deposit-rates.html

@JScott What did you do for "two of the wealthiest people in the world"? I remain suspicious reading this while seeing you peddle books on house flipping in your signature.