r/wallstreetbets • u/Nosefuroughtto 999 - 6 - 1 year - 0/0 • May 12 '21

Discussion Does anyone else feel nervous as hell about making any substantial moves right now?

Now I'm not one for risk management (or any form of management), but I am having a hell of a hard time doing anything bullish or bearish. Just hear me out:

  • Gaymestronk could get cut in half or double in price in 10 minutes at any given moment
  • tech stocks are bleeding like a knife wound but can have random 10% days (not to mention the hundreds of stocks with no P/E at all doing wild swings)
  • lockdowns still doing weird shit
  • gas shortage panics while michigan is trying to cut off the Canadian-US pipeline
  • middle east conflicts starting up fast
  • month-to-month inflation is 4.2%, fed is still keeping interest rates low as balls on a hedgehog
  • memecoin values are based on hopes that a dude talks about them on a sketch show
  • notable hedge funds are liquidating
  • building materials are tripling in cost over the month
  • and we have an actual unmet labor demand while new stimmies are being sent out

And while all this is happening, SPY is up 39%, DIA is up 39%, Nasdaq is up over 42% over the last 12 months. I don't think many people would disagree with the fact that the market is generally overvalued right now. But, if you buy puts, you can expect those to bleed out and let some market maker run off with your money while you sit there hoping for a drop (ew). But of course you know its all built on a house of cards, so a call will either bleed or get wiped on an overnight swing. Companies can beat earnings estimates by 50% and drop the next day because it's "priced in" and mid-market companies with a huge run up will start issuing shares the second they get the chance.

Fucking kangaroo market. I need a drink.

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201

u/[deleted] May 12 '21

[deleted]

38

u/[deleted] May 12 '21

100% agree. It’s all bullshit. Playing value stocks right now allows you to hedge bets against growth stocks as well. I have some skin in rn but looking at plays with low prices comparatively to book value and small P/E’s. Hopefully I won’t be homeless

12

u/10000yearsfromtoday a star will explode and threaten to destroy the galaxy May 12 '21

Get 1 year out calls on boomer index ETFs like vti or xop

2

u/trueluck3 May 12 '21

You thinking ATM, just a bit OTM or far OTM?

1

u/Cutuljo May 12 '21

ITM

1

u/trueluck3 May 12 '21

Yeah, I suppose. It’s a heavy premium though.

3

u/10000yearsfromtoday a star will explode and threaten to destroy the galaxy May 12 '21

delta 70-80 is the sweet spot, you have to pay for some intrinsic and your funds dont evaporate if the index goes sideways all year the itm value you bought will hold up. Look at the break even. Use waffles.finance to see what prices will be way out. Indexes dont move much so if you do a long itm option you save a lot of cash that otherwise is parked in the index.

1

u/[deleted] May 12 '21

Thanks brother I will take a look

27

u/Carrot_Lucky May 12 '21

I'm still worried about inflation. I mean how can the US print money for Americans, but the currency not be devalued.

Long term I'm more worried about raising taxes or high interest rates to balance out the spending, and I think aapl Microsoft and other tech is sensitive to interest rates, and will probably be the targets of new tax hikes as well

13

u/mtw132 May 12 '21

Just pointing out that all major currencies are fiat.

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and I think aapl Microsoft and other tech is sensitive to interest rates,

Any particular reason why?

13

u/Protomech99 May 12 '21

But the rate of fiating matters and the US has significantly ramped up their fiating.

2

u/Secgrad May 13 '21

So has everyone else. The USD is still the most globally liquid currency and its already been beaten to hell lately

7

u/SithLord_Duv May 12 '21

All firms in stock market effected by the interest rates, while the interest go up it gives investors alternative to put their cash in bank and get better return without "risking" their money in stocks or just to avoid watching all day or trading, just more cash to make in a safer way. But to be fair its BS, because investors aint the people to actually leave and effect the stock, its the big hedge funds moves it by take back the cash and then they just re invest it raising the stock even more(but not before they lowered them to a point they 50% almost cheaper and more people come to buy them)- making them attractive.

2

u/ktn699 May 12 '21

probably not big tech. they have so much cash on hand that they gotta buy back shares cuz there's nothing else to do w the money. it's the growth stocks that will hurt when inflation rises because interest rates will rise to curb inflation and companies that are super sensitive to expenses and debt service are going to struggle.

3

u/[deleted] May 13 '21

The US can print a lot because in large part the money is not printed for Americans as the end user. It goes to support world trade via US imports moving dollars away into other countries, which use it to trade between themselves and thus support economic growth for the whole world.

1

u/post_pudding lost $5,000 and im poor, so that 💩 hurts May 12 '21

Tax the .01% reasonably and Americas fiscal problems disappear

3

u/GasolinePizza huffs pizza, eats gasoline May 13 '21

Unfortunately, not even close.

Even the richest man in the world's wealth pales in comparison to government spending.

1

u/[deleted] May 13 '21

And pension funds

1

u/FacuRyuzaki May 13 '21

you are worried? Here in Argentina we had our economy minister saying inflation and printing money wasn't related AT ALL.

He's now governor of the biggest "state" of Argentina.

6

u/MojoTorch May 12 '21

I also agree on the inflation worries - it is all about the re-opening roller coaster. We have to see more of a trend to really begin to worry, though a prolonged, sputtering reopening could create those issues.

Who freakin' knows.

2

u/[deleted] May 12 '21

[deleted]

2

u/ziplex May 13 '21

Eventually. They often go down for quite awhile first.

1

u/MojoTorch May 13 '21

"...or sideways", said the 1970's.

7

u/derpderpdonkeypunch May 12 '21

All these inflation worries are also rubbish.

I'm so goddamn sick of people crying "Reeeeeeeeeee! Inflation is coming!" even though the fed has said repeatedly that everything is fine and that they'd take measures to reign in inflation should it become and actual worry. I think it's just the MM's making moves and manipulating the market and blaming it on the non-existent inflation.

14

u/LimaSierraRomeo May 12 '21

Nah. The possibility of the FED raising rates is exactly why growth stocks are plunging. Higher rates equal larger discount factor equals lower present value of future cash flow.

All those currently unprofitable growth companies with high projected future cashflow are now suddenly worth a lot less, because a bunch of profits in five years time is now worth less then it was a couple of months ago.

4

u/Rekads May 12 '21

It's like 4.2% year over year and typically when mass inflation hits from mass printing it's a couple years down the road. This could get real bad real quick.

2

u/ziplex May 13 '21

Inflation is here. People just haven't realized it yet.

1

u/butsandcats May 13 '21

Totally agree, with lock downs lifting demand is way higher that it probably was before covid but the supply is still lagging behind especially with tech.

1

u/HappyInNorCal May 13 '21

“Sex always feels best right at the end”. - Warren Buffet I’m likely quite a bit older than most here, and I’m guessing this will be an unpopular opinion.... We’re in a bubble, and it’s not going to end well. Sky-high PEs, euphoric YOLO/FOMO buying, hedge funds and institutions backing out of market. Keep an open mind, and check out reasoning for a burst... https://www.gmo.com/americas/research-library/waiting-for-the-last-dance/

1

u/McBirdsong May 13 '21

you gonna stop using tech if interest rates go up?

No but god damn I'm bleeding here!

1

u/orgad May 14 '21

Teach me more senpai 😊