Investment BS Thread - Stocks/Futures/Mutual Funds/Bonds/Commodities/Options/ETFs/401ks/Etc

Still pounding the Facebook table boys. There is so much monetization left in Instagram it is insane. On top of that it isn't some fantasy land tech stock, they print cash.

I can only hope a market crash makes it even cheaper. Bought er all the way down to the low 130's.

 

Y'all seen this??? 3% APY in checking and savings? If they're FDIC backed then I'm going to be moving money from my GS Bank account.



https://blog.robinhood.com/news/2018/12/13/introducing-robinhood-checking-amp-savings

https://www.usatoday.com/story/money/2018/12/13/robinhood-savings-account-interest-rate/2300383002/

https://techcrunch.com/2018/12/13/robinhood-free-checking-and-savings-accounts/

 

Did some more reading, these are not bank accounts, they are cash management accounts (basically investment accounts), they are SIPC insured up to 250k, but are exposed to market volatility risk, since the interest earned is from short-term treasury bills. I don't know whether or not this exposes the cash directly or only affects the interest rates. There isn't much info on how this is taxed, either, except for a little tidbit on a marketwatch article:
https://www.marketwatch.com/story/r...uld-consumers-hand-over-their-cash-2018-12-13

But because they’re investment accounts though, they are taxed differently. For instance, interest earned through U.S. treasuries is tax-exempt at the state and local level, whereas interest accrued on a traditional savings account is taxable.

 

That is not bad. I wonder how often they pay you (weekly, monthly, annually, etc). That would the most important part to me.

 

They do payouts daily. Seems like overkill IMO

 

The more the better! No that is a bit much, makes your job of managing your money a little more challenging than tracking monthly payments.

 

Exactly. Maybe there will be an option to make the payouts weekly/monthly, somehow I doubt it. I think the app Personal Capital will still add it all up for the selected time period, it would just be annoying seeing all those little transactions. The interest compounds daily like most other high yield accounts, so why not just do that and then pay it a little less frequently? I mean you would have to have like $15k in there just to see a measly $1 per day.

Edit: math correction

 

it may continue. Tech stocks are all getting hammered, their debt will reach maturity and then things will really get interesting. Netflix will probably be the most fun to watch.

 

If you hang onto that for a long time I think you’ll be happy with that decision.

 

You do have to be very picky in the tech stocks. FB has 0 debt. I wouldn't touch Netflix, they are about to get beat down in the content battle by Hulu and Disney. Disney owns 2/3 of Hulu now, which is why everything fox/Disney has been migrating from Netflix. Tesla will get crushed as soon as the big boys of the auto world decide to show up and compete on top of their pile of sketchy financing. The list goes on.

With a pile of sketchy out there though, if it goes down, it will bring the good ones down with it and it will make for once in lifetime opportunities out there..

 

It looks like they are catching some crap for this. Tried to pass it off as a savings account, while it’s actually a brokerage account, which are promoted and insured very differently, and they didn’t talk to any of the regulating authorities, etc. I’d still be interested but apparently they have to sort that all out now.

Edit: Just read your link, that’s what I saw on CNBC. Maybe I should read before posting

 

The more info out there the better. I saw the same, but it's good to let others know in other forms.

I find lots of info in forums, then research it elsewhere. I think it leads to less biased data and let's me make up my mind which versions are closer to the truth.

 

when I 1st read about Robinhood, I was thinking "no way"! How is this possible.?

Now that they are under the magnifying glass, I see them having a very hard time getting much interest.(no pun intended)

It seems to me they were taking advantage of the uninformed. There are many that have good chunks of cash, but are not at all financially saavy. I'm thinking this is the group they we're aiming at.

I admit fully that I have limited financial knowledge, but that just seemed way too good to be true.

I contribute my sceptacism to this thread and others that are similar.

I'm glad we have groups like this.

 

I still wonder how they do the no fee trades with no minimum account balance. It seems too good to be true, but it seems to be working.

 

They take fractions of a percent off trades and they also collect interest from cash sitting idle in accounts. I would assume they will also skim the extra money made off short term treasury bills for these banks accounts. If/when the interest rate goes above 3% for their treasury investments, they will take the extra income from that. My understanding is they have no intention of increasing the interest rate of their "bank" accounts beyond 3% so if short term notes are 4% then they will keep the 1% as profit

 

So I’m interested in getting into options, I read a little about it but Is there any sites or videos you guys recommend before I throw money away?

 

https://www.optionseducation.org/co...ts/book/guide_to_investing_options_kindle.pdf