Nicely done. 600k outside of the 401k is an impressive amount for your age. What's your overall strategy for stock selection? Looks to be High Growth strategy

Anyone go into fast-food franchises?

These days I use the drive-thru.

You?

Gunfighter, what does “net leased” mean?

Tenant pays taxes, insurance and maintenance on net leased property. Google NNN lease for a more complete explaination. In a single occupancy building the math is simple. In a multiple tenant property the expenses are split, generally based on percentage of the property occupied by each tenant.

His wife passed away several years ago, didn’t she? Or am I thinking about someone else?

Did. He remarried in 2006 to Astrid Menks

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I thought maybe he remarried and that’s what you were talking about. I saw a documentary about him and remember his wife passing away but couldn’t remember if he remarried. A guy with his change could have scored a Victoria Secret model. 😀

For starters—I have been incredibly lucky. First major investment was circa 2009 with SBUX when it was hovering around $10 and nobody would ever buy a $5 latte again. I put pretty much 80% of every penny I had to my name into that stock. That gave me a six figure starting point two years later.

Once I sold SBUX I decided that was a combination of luck and skill. I decided at that point to buy a little company that was mailing discs out called Netflix, which also doubles as my biggest regret. To the guy in this thread who said “I love stories like these, when the taxi driver starts talking about how much money he makes....” screw that.

NFLX Paid $16.02 a share and sold for $42. Had 1,200 shares. Still a nice profit. Today had I held that, those 1,200 shares alone would be worth $605,000. I fell victim to reading internet message boards on finance, listening to people say “bears make money, bulls make money, pigs get slaughtered.” Lesson learned.

Since then I have had some luck with some biotechs. Other than that I look for emerging markets/sectors/companies. WKHS, RMG, PLUG, BLINK, FCEL being just that in the EV sector. These are going to be huge going forward. I also own RIDE which I bought in the SPAC phase when it was DPHC (actually a reverse merger concept with WKHS).

Opportunities are there if you read, know what you own and go from there. I’ve made some mistakes (NFLX, FB—again sold way too soon, etc.) but that is tuition. Outside of that I have had some pretty good success and once the ball gets rolling, it becomes easier and easier. So for someone with $10,000–once you hit $25,000 that’s a big deal. Then $100k happens and from there as long as you’re disciplined and willing to stick to a plan good things happen.

Have my parents to thank honestly for seed money. They had set money aside for college for me and ended up giving me a portion of it once I got a scholarship. Best of luck Deltoids, just like our day jobs there are a million ways to do it—just be smart about it.

I've run into a tremendous number of "lucky" millionaires. Most of them were prepared for opportunity and knew what it was when they saw it. I've caught some great opportunities, but also missed some great ones because I didn't see them. There are numerous people, who were presented with the same opportunity (SBUX, AMZN, NFLX, 2007-2012 real estate), with access to similar financial resources, but didn't know what they were looking at.

I actually lost a friendship after handing over one such opportunity. I didn't have the financial resources and bandwidth to take on two storage facilities simultaneously, so I took the largest one I could while handing over the second. The friend passed on the deal over a 5-10% price difference, then became increasingly bitter as it became apparent he had walked away from a 7 figure payday.

Luck is often found at the intersection of Opportunity and Preparation. If you stay on Preparation Road long enough, you will reach the Opportunity intersection. It's only a matter of time.

My worst miss was Bitcoin. A friend pointed me toward it in 2011 or 2012. He wanted me to buy a thousand but I didn't really understand it and was running a business so I didn't take the time to investigate. It was trading at three bucks. That's twenty million plus today. He sold his too early but did make seven figures on the deal. I had the three thousand and could have afforded the loss.

Easy come, easy go.

the resounding theme here is that the hardest part of investing is sitting on your hands and letting the companies and markets do the heavy lifting. I too have “taken profits” on positions that would be worth a life changing amount had I held them until today. But, that’s part of the journey with long term, buy and hold investing. You won’t understand it until you go through the course at HKU.

I like Tegridy’s dabbling in these EV stocks; I’ve done well trading contracts on them, but like he said the sector is HOT right now. Many have virtually zero fundamentals behind them and are nothing more than the figment of someone’s imagination (NKLA for example). These are fun to trade but 1% will live on to be the next TSLA. I wouldn’t start with them if I were building out a portfolio at this moment.

As always; NTFAFAP (Never take financial advice from a pilot)

You've identified one of the best things about real estate. The illiquidity acts as forced hand sitting.

It is really more like trading around a position using options, but I read about the idea in a book on hedge funds.

imho, people way overthink options trading. All these complex options are a waste of time and limit your income. The best phrase I ever read regarding options, and it is absolutely 100% true is that 'you never make money buying anything'. Sell puts.... sell calls.... make money. dyodd, ymmv, etc etc etc

Lol 100% agree with the last part. As far as the EV sector and particularly NKLA... that company makes zero rational sense. WKHS is one of three finalists for a $6B+ USPS market.

I’ve toured their facility. It is impressive. I’ve listed all of the hot EV sector plays I have. I funded my WKHS play with TSLA profits. Didn’t sell all my TSLA, but initially the investment began with TSLA profits. Once up ~40%... I averaged up with my own money.

USUALLY, with a spec play I will not initiate a position with more than $10,000. If my $10,000 turns to $17,000, I have no problem averaging up. Protecting the seed money is key IMO.

This is probably the best conversation I have ever read on APC. Some intelligent points in this thread.

That’s exactly right.

Owning the underlying stock and writing covered calls and put contracts. Especially on the weekly level or a few days out from monthly OPEX.

Another thing—back in March opportunities presented themselves that we haven’t seen in a while. There was a market wide fire sale in March.

For reference (these were purchases I made on 3/18/20).

BA 3/18/20- $100.79 Close today 12/16/20- $227.03. I sold at $177.50.

LYV 3/18/20- $25.54 (reference CEO and Mark Cuban, I am not that smart. I just followed the money). Close today 12/16/20- $73.68. (Still holding).

PTON 3/30/20- $30.00. Today’s close $133.92. (This is a grand slam—still holding).

V 3/18/20- $146.61 will hold forever. Just added at this price.

SBUX 3/18/20- $52.36. Close today $103.27. Still holding.

These types of opportunities when presented allow options traders to buy calls far out that are almost guaranteed and make thousands and thousands of dollars.

If you have the money—you buy the shares, and write contracts for some passive income as we go along. I’ve been writing puts on the above basically since acquiring/adding in March. Just a bit behind how I think and trade. Love love love talking about this ****.

good point; I never thought about it like that, actually.

yep; selling premium is the way to go. But adding a long put or call to cover the short contract to limit your downside and preserve buying power is easy to do. Managing buying power is the other half of the options battle.

One of my favorite ways to trade is around earnings due to increase volatility. Writing an iron condor or iron butterfly and targeting a 20-30% profit the day after earnings are released is pretty easy money. But, its complexity over say, a naked put, makes managing it if the stock blows out one of the short contracts a bit of a PITA.

I declare a complete deviation from the “side hustle” topic.

Naked puts can kill an account, especially if you are on portfolio margin. Always use a spread on the down side.

sure; if you’re writing naked puts on Amazon. But if you’re writing one on DAL with moderation, and you want assignment of shares, that’s a different story. So I wouldn’t go as far as saying all naked puts can kill your account. I often write naked puts for a better entry price to shares I want to own.

On individual shares if you're willing to own the stock, sure, no problem. I trade cash settled options on SPY so always using protection to limit the risk. I should have been more specific.

I think it was John Gruden who said “ When opportunity knocks, it’s too late to prepare.” Anyone who had cash on hand after the 2008 crisis, had their pick of cheap high quality stocks or real estate investments. This pandemic, not so much. Yes, there was a substantial drop for a month or two in the markets, but real estate never got cheap, in fact, just the opposite happened.

What cash I had on hand during the drop in March/April, I wanted to keep liquid because of uncertainty, and I expected the pullback to last a lot longer, which it didn’t. But I have done well trading this year and have done well in my 401K.

Word! Its absolutely crazy to me to see the real estate market the way it is right now. I have been expecting a correction, but it just keep going up and up. Stuff is going above ask with competing offers, the day it hits the market. Selfishly, I'm hoping for a correction in the real estate market since I'm hunting for my "forever home."

2.25% 30 yr notes will do that. Uncle Sam can’t stop the presses on the “quantitative easing” binge we’ve been on or things will get ugly. Prepare for the ugly. It’s an opportunity.


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Can only speak to my locality (Norfolk/Va Beach) but there is stupid low inventory right now here.

Some of it is fear of "people with covid being in my house looking at it" which had about 30% of my wife's listings drop or become unshowable. But we are in an area that people still move in and out of (heavy military presence, 3-4 years average time on station) and a few corporate HQs with people always moving in and out.

Anything on the market, that is priced around market will sell within a week. My rental sold in 3 hours, with a bidding war.

Selling the rental was easy. I too was expecting a major correction and wanted out before that hit. Got F'ed with that in Jacksonville in the 06-08 crash. Problem is, if I sell my main house to cut expenses, not much to buy. And certainly none of it would be a cost savings.

We have enough people coming in with steady gov't or high enough up in the corporate structure they don't get laid off, checks. We do have the second highest percentage of people in the US for a metro that have their checks come from FedGov, just behind DC, so it is semi insulated here, because so many of the people are in jobs that won't go away short of the USA ceasing to exist as a political entity.

My basic plan if the market tanks here hard, and I still have a job, is to just ride it out. I'm a block from the bay, I have a dock, my area will be one of the first for housing prices to recover unlike cookie cutter subdivision #844 that only justifies the price because local HS and ES are A rated.


If the economy tanks hard, I'm going to learn from my parents, and if there is no prayer of getting out of the house clean, and I have no income beyond unemployment and VA disability coming in and no prospects of that changing, say we hit a 1930s level depression, or worse, I will just sit on what liquid assets I have and let the bank take it..

In the 08 crash, my dad became very ill, lost his medical, (no major airline style decent disability) and their farm that was worth $800k that was mortgaged for $600k, became worth $400k overnight. They blew through all their savings, both normal and retirement, only to delay the inevitable foreclosure by 18 months, and were instead **** broke living with me at the end of it.. Only so Bank Of America would lose less money (and get a govt bailout anyway)

I am looking for the same. I also feel like the only person who doesn't like housing prices that are always climbing.
What good does that do for the average person? The example I use: If you buy a house for 200K and it goes up 10%, you gain 20K. If your next house was worth 400K and went up 10%, it increased by 40K. Now that 20K you thought you had gained in value is actually a 20K hit. It helps the lenders as you will need to borrow even more for the next house. It helps the lenders when you take out a HELOC because it increased in value to make improvements to your house. Climbing home prices is definitely good for the lenders. I look forward to not having a house payment someday.

I can’t believe housing prices now compared to 20 years ago. I got into mine in 2000. Then did what you are not supposed to do.... Tore down the old house and built new becoming the most expensive house..... Well, in the last 5/10 years, there have been a lot of tear downs and rebuilds/remodels that are waaaaay more expensive than mine was in 2000 (obviously I’m no longer most expensive house) and housing prices have gone stupid/crazy here and just keep going up and up. If I ever sell it, it will be the first time I make money on a house.....but it will way more than make up any previous losses which weren’t much.

Denny

The people that moved in next to me paid $75k over what comps showed. Well into the $600s.

Maybe I’m just old fashioned, but that’s a ton of debt to be carrying. Normally, I’d write it off to a wealthy Aunt, hit the lotto, frugal savers, married rich or what have you, but it’s been happening all over our area. People just walking in and financing a $600-700k house. A new development nearby with that price range was completely sold out in about six months.

A handful of people I could see, but it’s like everyone can swing a 600k note these days.

P&I on 600K is $2,293 for a 30 year loan at 2.25%. Just a few years ago at the historically low rate of 4%, the payment was $2291.59 on a 480K loan. At 5.5% (2009-2009 rates) that payment would equate to a 400K mortgage. People buy houses on monthly payment more than purchase price. Buyers are skipping the middle home and going from the starter home straight to the forever home.

Inflation will wipe out much of the debt, might as well go big.

You have people with middle class dual incomes taking out 30 year notes at 50. With no means to make that payment at age 80. So the “forever” home is not forever as they realize they have to downsize. Average retirement savings in the US can’t cover a $2300 payment with taxes and no job.

Folks are refinancing from "historic low" interest rates a few years ago, to this new historic low. Friend of mine at a major Bank says their underwriting department is backlogged at least 2 months i.e. your closing date is 2 or 3 months from when your loan application is completed. Cray-cray.

A5S

The effective burden of a payment will definitely go down amidst the inflation we have coming. Although property taxes on a 600k house have a pretty good chance of being significant and inflation-adjusting.

My friend in the industry who is going gangbusters believes they're doing some of their last refinance business for a decade. Lucky for her she's about to retire.

I got margin called bigly back in early COVID times. It took me six months to dig out of the hole, but I have dug out and a lot more. I hear what you are saying, and trading on margin isnt for the faint of heart, but I stick to my statement that all that exotic spreading/ straddles etc etc etc is a waste of time and limits your profits. dyodd, ymmv, etc etc

America's financial literacy rate is well below where it should be. Today that dual income, middle class couple live in a house only rich people could afford a few years ago. The 30 year mortgage is "tomorrow guy's" problem. Inflation may help them make an exit 15 years from now. The problem they could face is downsizing from a 2.25% mortgage to a 5% mortgage, when they realize retirees cant afford $2,300 + Tax, Ins & HOA.

amen to that one! Financial illiteracy is insanely prevalent in American society. People are more fluent at fantasy fooseball than they are budgeting. It’s most likely all by design. Keep society illiterate so the institutions can exploit it. I graduated with a guy that makes tens of millions selling annuities and underperforming mutual funds. He’s licensed to sell insurance but somehow he has become a local financial expert, Calls himself a financial expert and advisor, goes on local tv and radio, has a podcast etc etc. All that matters is that he calls himself an expert so that people can feel like they’re making the right decision. He’s a prime example of someone who has mastered the art of exploiting the financial illiteracy in our country.

This is the perfect person to ask to produce documented performance on an annualized basis versus the S&P. Watch his eyes glaze over when you do.

I guess the main take away in this entire discussion is, nobody cares about your financial future and well being more than you. I’d say everyone that’s participating in this thread is well ahead of the curve. Cheers!

This is what happens when the government runs the schools.

You can trade cash secured puts in the 401(k)/brokerage link. I forget what the selection was on the paperwork, but you can get it approved.

For those of you that bought mid March/April shares, what was the outcome?...sold, hold, buying more etc?.........save, luv, etc......