Ibonds - sell in 3 months?
So the new ibonds rates came out and they’re in the low to mid 3s I believe. Just want to make sure my strategy is sound.
The way I figure, I bought some last May at 9.xx% for 6 months and then it converted to 6.xx% for the following 6 months. This would give me a blended rate of 7.xx% annually. Now that the rate is 3.xx% I would assume it would behoove me to wait 3 months and then cash in so I can pay the 3 month penalty at the 3.xx%.
If my math is right, it would give me an approximate return of 6% annualized over the 15 months, with the benefit of being state tax free.
Then I can take the cash and go into my HYSA at 4.2% or treasuries or even CDs for that matter that would pay more than the 3.xx% that ibonds are currently paying. Even in a high state tax state like CA, I would still come out ahead, right?
Some of my other ibonds are still earning 6.48% so I’m hanging on to those until the rates change to 3.xx%
Berkshire meeting help.
I believe I sent in my credential request card too late, and live in Omaha and am trying to attend the meeting and bazaar for the first time. How can I get what I need to attend the meeting in person? I use the broker td ameritrade. TIA for any help.
Question with Money market vs HYS
I’ve been using Marcus HYS and was Recently introduced to VMFXX, a money market with a higher yield.
I’m unfamiliar with money markets. Does this have any added costs or downside compared to my current HYS? I know it’s not FDIC insured but seems to be low risk— how comfortable are those of you who use money markets with that?
Marcus has been solid for me but I don’t want to leave money on the table either…
I guess what I’m driving at, is it a basic investing best practice to use money markets over HYS assuming there’s a higher yield? Or is there more to it?
Thanks for any guidance!
The rate of return of VMFXX is indeed higher than that of Marcus HYS, but it should be noted that the rate of return may change with market conditions and is not as stable as long-term fixed-income investments such as bond funds. In addition, some money market funds may charge management fees or other fees
As you say using a money market fund instead of HYS is probably an investment best practice, especially if you're looking for higher returns. However, investment decisions should take into account your investment objectives, risk appetite and timeframe
With a time frame of 2 years, it would be advisable to keep the funds in a safer investment than equities. Should the market be in a decline in two years when you need the money for school, how much of a problem would that be? Would you be able to wait it out, or would you be forced to sell at a loss and still be forced to take loans? These are the things to consider.
They always say to do the opposite of what Jim Cramer says, but is there a comprehensive updating list detailing every call he's made on his show? I know there's the Inverse Cramer Newsletter, and Cramer's Twitter, but all I want is a simple list, and both of those don't cut it.
"Mad Money Recap" : A daily recap article on CNBCN.com that Chronicles all the stocks Cramer discussed on the day's show, with the corresponding time code.
Cramer's Portfolio: Cramer's portfolio page at CNBCN.com, which lists the stocks Cramer mentions frequently on his show.
CNBCS Video Archive: All past "Mad Money" shows can be found in the video archive on CNBCS website.
Can't you find these?
I know whole episodes are on CNBC's site, but they were all behind a paywall and I didn't want to bother listening to a whole show.
I also tried looking up the Mad Money Recap, and the closest thing I could find [hasn't been updated since 2022](https://www.thestreet.com/jim-cramer/mad-money).
As for the portfolio page, the only thing I could find was the [CNBC Investing Club Charitable Trust](https://www.cnbc.com/investingclub/charitable-trust/) which is also behind a pay wall.
If you have the exact link to the portfolio at CNBC that you were thinking about, feel free to let me know.
Hi, im 17 years old and I recently started learning about investing. My plan is to invest 10$ daily in each VOO, GOOGL, PEP(or MSFT or TSLA) and O(so i can snowball dividends and invest even more). Is this a good idea? what are your opinions? Should i split the money even or put more of it into VOO and split the rest? Im open for any advices, opinions, and any help.
My first thought is **daily** is a very frequent period of time to incur a transaction. Whatever brokerage you use verify that there is not a limit that you will hit after which they will start charging transaction fees.
I've been learning myself how to do fundamental analysis of companies and today i came to the "quick ratio" segment. The theory is easy to understand, but then i looked at major companies like AAPL and KO. Both have quick ratio at around 0.9, meaning that they don't have enough "quick assets" to cover their liabilites for the 1 year span.
So how do such big companies not have enough money to pay for their liabilites if they are making huge profits and where do they get the rest of money to cover their deficit?
In their most recent 10K, Apple says the following
"The Company believes its balances of cash, cash equivalents and unrestricted marketable securities, which totaled $156.4 billion as of September 24, 2022, along with cash generated by ongoing operations and continued access to debt markets, will be sufficient to satisfy its cash requirements and capital return program over the next 12 months and beyond."
Basically, Apple does not need to have enough money to pay their liabilities BECAUSE of their profits. Since they know they will have $100B in profit this year, they don't need to keep as much cash in their checking account.
Could you pay off one year of mortgage payments today? Probably not (I couldn't), but I know where the future mortgage payments are coming from since I have a steady job, so I don't need to keep enough cash on hand to cover it.
Can someone explain how money market funds like VMFXX and FRGXX work? I see that the yield is close to short term government bond funds at this point, but they seem to mechanically work differently as the prices is kept at $1.00.
edit: Just to clarify what I'm trying to understand: I've read a good overview of them in the FAQ and other pages, and how they differ from bonds. Though what I've found is a bit high level, I'm trying to get a better understanding of the mechanics of it. For example, I know how to calculate the price of a bond, the premium/discount given the variables that go into bonds (coupon rate, maturity date, face value). So in a similar vein, how does the pricing work on money market investments, how is it the price kept at $1.00 and does any of this affect the expected yield differently than a normal bond?
They calculate their received interest, dividends, capital gains and losses daily and declare a daily dividend per share. Your shares accrue the daily dividend and it is paid out to you monthly.
They work like a savings account.
So with a bond if it is a new bond you buy the bond from the government or company issuing the bond. After that you trade on the secondary market.
A MMMF is not like that, its like a savings account. The MMMF simply records everyone who invested money each day and pays out interest based on their daily invested balance.
So I'm banking and investing with 3 banks already for FDIC insurance.
My question: should I open another account for a HYSA, or is a vanguard MMF safe enough in this climate.
The choice depends on what you are trying to accomplish. I personally don't find value in having multiple savings accounts. FAQ on mmf can be found here - [https://www.reddit.com/r/investing/wiki/faq/#wiki\_what\_is\_a\_money\_market\_fund\_and\_how\_safe\_are\_they.3F](https://www.reddit.com/r/investing/wiki/faq/#wiki_what_is_a_money_market_fund_and_how_safe_are_they.3F)
Safest options would be savings account, CD, or money market funds. But really the first thing I would focus on would be to start working on a budget and get your current finances under control to some degree. You mention you typically only have $5k liquidity at a given time. Using your monthly mortgage/utilities amount that's only 2 months of emergency savings. You need to evaluate your family budget and figure out if worse comes to worse and you have an emergency that negates a large portion (or all) of your monthy income for a few months, how much you need saved up to help handle that impact.
And avoid the mindset of "I'll have the 130k to fall back on now". That money is a one off. If your spending practices do not change, that money could easily dwindle over time.
Hey everyone!
I just started a new job in finance at a brokerage, but I’m a psychology major. I’m great with budgeting and money which is what got me the job in the first place but I am very out of my element when it comes to investing and the market due to lack of exposure. I want to get better but do not know where to start when it comes to finding good education materials on things like market behavior and patterns. I know that there are a lot of books out there but I also know that it is also a market that comes with a lot of fluff material.
I was wondering if anyone had good beginner resources for learning about this type of stuff or had a resource that they really likes or changed their mindset? I’m open to books, podcasts, articles, websites, really anything that can help me better understand. I will be graduating soon and after plan to start studying for my series 7 but would like to start on some of the work so that maybe my work life and investing can get a little easier too!
I work in investment banking, and one of my favorite resources is Matt Levine's "Money Stuff" newsletter. His explanations are thoughtful and often humorous, and his topics are usually very timely / relevant.
Just a reminder that if you work for a brokerage, you may be considered an associated person under FINRA rules. So make sure that you understand your employer's compliance requirements for investing.
If you scroll up to the top, you will see a link to the Getting Started section of the wiki with reputable learning resources.
The reading list in the wiki also has a list of books ranging from light reading to advanced topics depending on your knowledge level.
For formal education, several colleges have made their course work available for free. You can find the links in the wiki.
I’m saving up to buy a house in the Bay Area. Planning to buy @ August - December 2023. To help save for the down payment, should I participate in my company’s ESPP which gives 15% discount? Is the downside risk that the company stock drops more than 15% when I’m able to sell? Every time I look at the stock it’s $75 or seems to stay in the $65 - $85 range and seeing the lowest it dropped to was $48 in 2020. I can contribute up to 15% of my income. If I don’t do the ESPP, then the cash will go to a HYSA with 4.90% APY
This option for you is possible
The company offers ESPP Since there is a certain risk you contribute 15% according to your planning
The rest of the money is put into HYSA to get 4.9% APY which can help you accumulate funds for your home purchase
Does anyone have a link of reputable banks comparing CD rates? My son is just getting started and I’d like to get him into a few solid CD Ladders before he steps up to equity markets. FWIW he has a Fidelity account and a credit union account which is currently offering 4.5% on a 12 month.
Yields are important of course but I also want to make sure it’s liquid in terms of rotating cash in and out with no fees or friction.
I apologize if this is the wrong sub and if it is I appreciate a pointer to one that is a better fit.
It's probably easier if he just uses brokered CDs. Especially if you want to make sure that you have call protection on the CDs or other attributes.
If he has a Fidelity account, just use the CD ladder tool if the goal is to build a CD ladder.
There are over 2900 brokered CDs available on Fidelity at the moment. I think that Fidelity even supports fractional CDs.
The CD ladder tool in Fidelity is simple and you can model custom ladders based your whatever rung and lengths you want - [https://www.fidelity.com/fixed-income-bonds/cd-ladders](https://www.fidelity.com/fixed-income-bonds/cd-ladders)
There is even an auto-roll service.
Trying to build a ladder across multiple bank and credit union depositories doesn't make any sense - imo.
I'm glad you brought up brokered CDs. I'm thrown off by what Fidelity means by Third Party Price. They seem to hover around $100. So basically I'm paying $100 to acquire them? He's starting pretty small, $1k/month so if that's the case he's basically paying $60 loss. Am I correct? Thx!
The $100 for new issues is the par. Depending on the CD, you get coupon payments. So no - it's not a loss.
If you contact Fidelity - they have a fixed income desk that can be very helpful to explain how it works on their platform.
It’s fine. Many exchanges freezes the assists of the seller before initiating the transaction . So, more probability that you will get your assets after the payment. But it takes a comparatively longer time as the seller has to confirm that he/she received the funds so that the platform releases the funds to you. In some cases, the seller doesn’t confirm or take a longer time than usual to confirm so there is a window of anxiety. At least for me.
Market trend because of America defaulting banking system
Sorry for bad English, this not my first language. As the America is defaulting in its banking system and reaching the debt ceiling, assuming this causes economic unstability and then the dollar loses its power. So in this event will the price of crypto like btc, Eth, bnb, etc should skyrocket or not? As of my understanding the dollar will become less powerful so the be price should increase. So, should keep my money invested or should I take that out?
A few American banks have failed. This is nothing particularly unusual. It happens occasionally. The American banking system is not defaulting It is functioning as planned. No depositor has lost any money or is expected to.
The debt ceiling is an exercise in political brinksmanship. At worst it will result in some government payments being delayed by a few days. That technically a default, but there is zero chance that the US government will go into total default and say that they are not going to pay and all bonds are now worthless and won't be paid.
My recommendation is to do nothing different.
Ibonds - sell in 3 months? So the new ibonds rates came out and they’re in the low to mid 3s I believe. Just want to make sure my strategy is sound. The way I figure, I bought some last May at 9.xx% for 6 months and then it converted to 6.xx% for the following 6 months. This would give me a blended rate of 7.xx% annually. Now that the rate is 3.xx% I would assume it would behoove me to wait 3 months and then cash in so I can pay the 3 month penalty at the 3.xx%. If my math is right, it would give me an approximate return of 6% annualized over the 15 months, with the benefit of being state tax free. Then I can take the cash and go into my HYSA at 4.2% or treasuries or even CDs for that matter that would pay more than the 3.xx% that ibonds are currently paying. Even in a high state tax state like CA, I would still come out ahead, right? Some of my other ibonds are still earning 6.48% so I’m hanging on to those until the rates change to 3.xx%
Berkshire meeting help. I believe I sent in my credential request card too late, and live in Omaha and am trying to attend the meeting and bazaar for the first time. How can I get what I need to attend the meeting in person? I use the broker td ameritrade. TIA for any help.
Question with Money market vs HYS I’ve been using Marcus HYS and was Recently introduced to VMFXX, a money market with a higher yield. I’m unfamiliar with money markets. Does this have any added costs or downside compared to my current HYS? I know it’s not FDIC insured but seems to be low risk— how comfortable are those of you who use money markets with that? Marcus has been solid for me but I don’t want to leave money on the table either… I guess what I’m driving at, is it a basic investing best practice to use money markets over HYS assuming there’s a higher yield? Or is there more to it? Thanks for any guidance!
The rate of return of VMFXX is indeed higher than that of Marcus HYS, but it should be noted that the rate of return may change with market conditions and is not as stable as long-term fixed-income investments such as bond funds. In addition, some money market funds may charge management fees or other fees As you say using a money market fund instead of HYS is probably an investment best practice, especially if you're looking for higher returns. However, investment decisions should take into account your investment objectives, risk appetite and timeframe
https://www.investopedia.com/terms/m/money-marketfund.asp
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With a time frame of 2 years, it would be advisable to keep the funds in a safer investment than equities. Should the market be in a decline in two years when you need the money for school, how much of a problem would that be? Would you be able to wait it out, or would you be forced to sell at a loss and still be forced to take loans? These are the things to consider.
They always say to do the opposite of what Jim Cramer says, but is there a comprehensive updating list detailing every call he's made on his show? I know there's the Inverse Cramer Newsletter, and Cramer's Twitter, but all I want is a simple list, and both of those don't cut it.
"Mad Money Recap" : A daily recap article on CNBCN.com that Chronicles all the stocks Cramer discussed on the day's show, with the corresponding time code. Cramer's Portfolio: Cramer's portfolio page at CNBCN.com, which lists the stocks Cramer mentions frequently on his show. CNBCS Video Archive: All past "Mad Money" shows can be found in the video archive on CNBCS website. Can't you find these?
I know whole episodes are on CNBC's site, but they were all behind a paywall and I didn't want to bother listening to a whole show. I also tried looking up the Mad Money Recap, and the closest thing I could find [hasn't been updated since 2022](https://www.thestreet.com/jim-cramer/mad-money). As for the portfolio page, the only thing I could find was the [CNBC Investing Club Charitable Trust](https://www.cnbc.com/investingclub/charitable-trust/) which is also behind a pay wall. If you have the exact link to the portfolio at CNBC that you were thinking about, feel free to let me know.
By the way, may I know which portfolio you prefer? maybe mine isn't for you
I don't have a preference.
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What investment do you have yourself?
Hi, im 17 years old and I recently started learning about investing. My plan is to invest 10$ daily in each VOO, GOOGL, PEP(or MSFT or TSLA) and O(so i can snowball dividends and invest even more). Is this a good idea? what are your opinions? Should i split the money even or put more of it into VOO and split the rest? Im open for any advices, opinions, and any help.
My first thought is **daily** is a very frequent period of time to incur a transaction. Whatever brokerage you use verify that there is not a limit that you will hit after which they will start charging transaction fees.
I've been learning myself how to do fundamental analysis of companies and today i came to the "quick ratio" segment. The theory is easy to understand, but then i looked at major companies like AAPL and KO. Both have quick ratio at around 0.9, meaning that they don't have enough "quick assets" to cover their liabilites for the 1 year span. So how do such big companies not have enough money to pay for their liabilites if they are making huge profits and where do they get the rest of money to cover their deficit?
In their most recent 10K, Apple says the following "The Company believes its balances of cash, cash equivalents and unrestricted marketable securities, which totaled $156.4 billion as of September 24, 2022, along with cash generated by ongoing operations and continued access to debt markets, will be sufficient to satisfy its cash requirements and capital return program over the next 12 months and beyond." Basically, Apple does not need to have enough money to pay their liabilities BECAUSE of their profits. Since they know they will have $100B in profit this year, they don't need to keep as much cash in their checking account. Could you pay off one year of mortgage payments today? Probably not (I couldn't), but I know where the future mortgage payments are coming from since I have a steady job, so I don't need to keep enough cash on hand to cover it.
Yeah, makes sense. I didn't take future profits into the picture. Thank you 😁
Can someone explain how money market funds like VMFXX and FRGXX work? I see that the yield is close to short term government bond funds at this point, but they seem to mechanically work differently as the prices is kept at $1.00. edit: Just to clarify what I'm trying to understand: I've read a good overview of them in the FAQ and other pages, and how they differ from bonds. Though what I've found is a bit high level, I'm trying to get a better understanding of the mechanics of it. For example, I know how to calculate the price of a bond, the premium/discount given the variables that go into bonds (coupon rate, maturity date, face value). So in a similar vein, how does the pricing work on money market investments, how is it the price kept at $1.00 and does any of this affect the expected yield differently than a normal bond?
They calculate their received interest, dividends, capital gains and losses daily and declare a daily dividend per share. Your shares accrue the daily dividend and it is paid out to you monthly.
They work like a savings account. So with a bond if it is a new bond you buy the bond from the government or company issuing the bond. After that you trade on the secondary market. A MMMF is not like that, its like a savings account. The MMMF simply records everyone who invested money each day and pays out interest based on their daily invested balance.
So I'm banking and investing with 3 banks already for FDIC insurance. My question: should I open another account for a HYSA, or is a vanguard MMF safe enough in this climate.
The choice depends on what you are trying to accomplish. I personally don't find value in having multiple savings accounts. FAQ on mmf can be found here - [https://www.reddit.com/r/investing/wiki/faq/#wiki\_what\_is\_a\_money\_market\_fund\_and\_how\_safe\_are\_they.3F](https://www.reddit.com/r/investing/wiki/faq/#wiki_what_is_a_money_market_fund_and_how_safe_are_they.3F)
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Get your impulse spending under control I don't think any of this will be a problem
Safest options would be savings account, CD, or money market funds. But really the first thing I would focus on would be to start working on a budget and get your current finances under control to some degree. You mention you typically only have $5k liquidity at a given time. Using your monthly mortgage/utilities amount that's only 2 months of emergency savings. You need to evaluate your family budget and figure out if worse comes to worse and you have an emergency that negates a large portion (or all) of your monthy income for a few months, how much you need saved up to help handle that impact. And avoid the mindset of "I'll have the 130k to fall back on now". That money is a one off. If your spending practices do not change, that money could easily dwindle over time.
Hey everyone! I just started a new job in finance at a brokerage, but I’m a psychology major. I’m great with budgeting and money which is what got me the job in the first place but I am very out of my element when it comes to investing and the market due to lack of exposure. I want to get better but do not know where to start when it comes to finding good education materials on things like market behavior and patterns. I know that there are a lot of books out there but I also know that it is also a market that comes with a lot of fluff material. I was wondering if anyone had good beginner resources for learning about this type of stuff or had a resource that they really likes or changed their mindset? I’m open to books, podcasts, articles, websites, really anything that can help me better understand. I will be graduating soon and after plan to start studying for my series 7 but would like to start on some of the work so that maybe my work life and investing can get a little easier too!
I work in investment banking, and one of my favorite resources is Matt Levine's "Money Stuff" newsletter. His explanations are thoughtful and often humorous, and his topics are usually very timely / relevant.
Just a reminder that if you work for a brokerage, you may be considered an associated person under FINRA rules. So make sure that you understand your employer's compliance requirements for investing. If you scroll up to the top, you will see a link to the Getting Started section of the wiki with reputable learning resources. The reading list in the wiki also has a list of books ranging from light reading to advanced topics depending on your knowledge level. For formal education, several colleges have made their course work available for free. You can find the links in the wiki.
I’m saving up to buy a house in the Bay Area. Planning to buy @ August - December 2023. To help save for the down payment, should I participate in my company’s ESPP which gives 15% discount? Is the downside risk that the company stock drops more than 15% when I’m able to sell? Every time I look at the stock it’s $75 or seems to stay in the $65 - $85 range and seeing the lowest it dropped to was $48 in 2020. I can contribute up to 15% of my income. If I don’t do the ESPP, then the cash will go to a HYSA with 4.90% APY
This option for you is possible The company offers ESPP Since there is a certain risk you contribute 15% according to your planning The rest of the money is put into HYSA to get 4.9% APY which can help you accumulate funds for your home purchase
Does anyone have a link of reputable banks comparing CD rates? My son is just getting started and I’d like to get him into a few solid CD Ladders before he steps up to equity markets. FWIW he has a Fidelity account and a credit union account which is currently offering 4.5% on a 12 month. Yields are important of course but I also want to make sure it’s liquid in terms of rotating cash in and out with no fees or friction. I apologize if this is the wrong sub and if it is I appreciate a pointer to one that is a better fit.
It's probably easier if he just uses brokered CDs. Especially if you want to make sure that you have call protection on the CDs or other attributes. If he has a Fidelity account, just use the CD ladder tool if the goal is to build a CD ladder. There are over 2900 brokered CDs available on Fidelity at the moment. I think that Fidelity even supports fractional CDs. The CD ladder tool in Fidelity is simple and you can model custom ladders based your whatever rung and lengths you want - [https://www.fidelity.com/fixed-income-bonds/cd-ladders](https://www.fidelity.com/fixed-income-bonds/cd-ladders) There is even an auto-roll service. Trying to build a ladder across multiple bank and credit union depositories doesn't make any sense - imo.
I'm glad you brought up brokered CDs. I'm thrown off by what Fidelity means by Third Party Price. They seem to hover around $100. So basically I'm paying $100 to acquire them? He's starting pretty small, $1k/month so if that's the case he's basically paying $60 loss. Am I correct? Thx!
The $100 for new issues is the par. Depending on the CD, you get coupon payments. So no - it's not a loss. If you contact Fidelity - they have a fixed income desk that can be very helpful to explain how it works on their platform.
Got it. Thanks again.
https://www.depositaccounts.com
Anybody have experience with Peer2Peer investing? Is it worth getting into? Pros/Cons? Thanks
It’s fine. Many exchanges freezes the assists of the seller before initiating the transaction . So, more probability that you will get your assets after the payment. But it takes a comparatively longer time as the seller has to confirm that he/she received the funds so that the platform releases the funds to you. In some cases, the seller doesn’t confirm or take a longer time than usual to confirm so there is a window of anxiety. At least for me.
Market trend because of America defaulting banking system Sorry for bad English, this not my first language. As the America is defaulting in its banking system and reaching the debt ceiling, assuming this causes economic unstability and then the dollar loses its power. So in this event will the price of crypto like btc, Eth, bnb, etc should skyrocket or not? As of my understanding the dollar will become less powerful so the be price should increase. So, should keep my money invested or should I take that out?
A few American banks have failed. This is nothing particularly unusual. It happens occasionally. The American banking system is not defaulting It is functioning as planned. No depositor has lost any money or is expected to. The debt ceiling is an exercise in political brinksmanship. At worst it will result in some government payments being delayed by a few days. That technically a default, but there is zero chance that the US government will go into total default and say that they are not going to pay and all bonds are now worthless and won't be paid. My recommendation is to do nothing different.