More rent control BS

[Jil]

@BAGB

That’s before manch’s 20% down stock investment. My greed is asking me to take a look at Manch strategy. My brain asks me to ignore it.

I’ll watch manch until the beginning of the next cycle. Will put 10% to try out Manch strategy when the market reaches bottom.

LOL again : Do you assume his loss will directly come to you as gain ?

[Jil]

@hanera

@Jil

LOL: Make no mistake to understand the meaning! This means it likely harm everyone, but given low age, they can recover through other savings/investment !

I tried. Lost a bundle! Easily recover if you are young.

This is universal experience, not an anomaly !

Real estate with mortgage is wise, Stocks without margin is wise !

[BAGB]

But there’s a real sample here who doubled his money last year and up 40% in the past 6 months.

It can be done, just make sure that you are good at it.

[Roy321]

@Jil

This is universal experience, not an anomaly !
Real estate with mortgage is wise, Stocks without margin is wise !

why?

[BAGB]

What’s your margin ratio, young man?

[hanera]

@BAGB

But there’s a real sample here who doubled his money last year and up 40% in the past 6 months.

It can be done, just make sure that you are good at it.

You still didn’t get the message. Since you insist, I made about 10x over a few years using options and then got chop to 6x in just a few weeks when the market turns… yes, the damn financial crisis. Lost 4x in just a few weeks. I went straight to cash after that (just like what Jil did recently). My message is if you think a strategy is correct then you’re wrong. Any strategy that is “in the market” make money. Let me repeat, in means make money in a bull market. The strategy means nothing. You must not think you have found THE strategy. Everybody think they are good (in fact a genius) in a bull market.

[Roy321]

@BAGB

What’s your margin ratio, young man?

very less… less than 10% at 0% interest rate (It’s technically not margin but 0% credit cards )

That’s why there is no during volatility from me.

[manch]

@BAGB

But there’s a real sample here who doubled his money last year and up 40% in the past 6 months.

No. I tripled last year and up more than 70% YTD. It’s more luck than skill. Don’t try this at home.

[Roy321]

@manch

No. I tripled last year and up more than 70% YTD. It’s more luck than skill. Don’t try this at home.

dang!!!

[hanera]

@manch

It’s more luck than skill. Don’t try this at home.

Actually you spend huge effort and much time researching, and your biz keeps you in touch with reality. BAGB is trying to copy the scaling up strategy without research, the hard work and your pulse on the economy.

[BAGB]

That doesn’t matter. As long as you can get 5x return in 18 months, forget about all those stuff

[BAGB]

40 * 1.7 = 68.
68/50 = 1.36

So your stock net up 70% and RE net up 36% YTD.

[manch]

Wrong math. Denominator for RE should be 60.

[BAGB]

Oh yeah, your RE net up 13% YTD vs 70% for stocks.

But is your stock leverage much bigger than RE?

[hanera]

Time to reevaluate manch’s NW. In Apr, we said manch: 5.1M… can’t remember the RE vs Stock allocation. Did he said 60:40? Now is 50:50.
60:40 => 3:2, since 2 up 70% i.e. 3.4, so his new NW is $6.8 Up $1.7M since Apr! He needs to throw a party. How about we book Alexander’s Steak House in Mainstreet this weekend to celebrate? manch can well afford to give us a treat.

[manch]

Last year I wrote a post on “dynamic leveraging”, a key ingredient of my algorithm. Nobody replied. Maybe time to dust it off again.

How Leveraged Should Your Stock Market Investments Have Been?

From Brad Delong, economics professor at UC Berkeley: His framework is similar to mine. Let’s say you decided you only want 2X leverage. So whenever your portfolio rises beyond 2X you buy more to take on more debt, and when it falls you sell to lessen the debt. At all times you try to maintain a constant leverage ratio. Then the question arises: what is the optimal leverage ratio? Answer: 2.42. Being all in bonds at β = 0 turns $1 of real value into $35 over the past century and a half. Moving from bonds to stocks—from β = 0 to β = 1—multiplies your portfolio value today by an additional 450-fold. Borrowing your wealth and adding leverage—β = 2—gets you from $16,000 to $380,000: an additional nearly 25-fold wealth amplification. And then going from β = 2 to β = 2.42 gets you an additional 40% to $528,000.

[hanera]

Magic number is 2.42 which is more than allowable under margin. Have to use portfolio margin.

[Roy321]

@Jil

This is universal experience, not an anomaly !

Real estate with mortgage is wise, Stocks without margin is wise !

@Roy321

why?

Here’s the answer - answered earlier by @hanera

More rent control BS

It doesn’t matter how to get the leverage. Many implementations and conceptualization. Leverage cuts both ways. Bull market makes TONS. In a bull market, so long you’re in, any approach make money. I mention my awareness of those who did the leverage as I felt obliged to inform The key is when to get out or deleverage completely… The problem with human is it is so hard to disengage once addicted.

[Jil]

@Roy321

@Roy321

This is universal experience, not an anomaly !
Real estate with mortgage is wise, Stocks without margin is wise !

@Roy321

why?

Here’s the answer - answered earlier by @hanera
More rent control BS - #344 by hanera

It doesn’t matter how to get the leverage. Many implementations and conceptualization. Leverage cuts both ways. Bull market makes TONS. In a bull market, so long you’re in, any approach make money. I mention my awareness of those who did the leverage as I felt obliged to inform slight_smile The key is when to get out or deleverage completely… The problem with human is it is so hard to disengage once addicted.

Excellent Answer ! I missed reading the question.
Even if I did, I would not have written such a nice explanation !

[sfdragonboy]

http://www.sfexaminer.com/debate-rent-control-measure-highlights-concern-single-family-home-owners/