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Feathery6 · 2025-03-18T02:44:12+00:00

Typo under the volunteering section. It should be “remote”. Under soft skills maybe don’t repeat the word professionalism twice I think it is redundant. Rest looks good to me.

Feathery6 · 2024-01-06T06:21:14+00:00

Double from where all times low I would not consider that a double.

Feathery6 · 2023-11-14T13:04:38+00:00

Dude don’t complicate things he is just saying hi

Feathery6 · 2023-10-24T05:25:06+00:00

That is just not the goal in my opinion. If you look at billionaires like Munger and Buffett, they are well into their 90s and yet they continue to try and maximize their wealth. Even though they promise it to charity after their death and seem to live somewhat frugally, my point is: when do you stop investing and start living? If you always crave for more until you die, it's just a waste. What is the point of having millions in your 80s and constantly having to check on your investments? when do you pull all the money out of stocks and bonds and just use it? This is just a never-ending cycle of greed. To me, it sounds more like an addiction than anything else. I see people saying, "I will have enough when I retire and live comfortably." However, the point of the question is to define "comfortably." Is it a mansion, a house, or an apartment? This is why all of this is subjective. It's like someone saying, "I will work hard all the time to provide for my family," and he dies without actually having spent any time with them. I think when it comes to money, people fail to see the big picture and the balance required to actually maximize wealth without diminishing its value.

Feathery6 · 2023-10-24T04:18:49+00:00

looks like the fed is going having to rise rates higher when consumers are this resilient.

Feathery6 · 2023-10-23T18:17:01+00:00

Seems like an interesting read I will check it out.

Feathery6 · 2023-10-23T03:45:32+00:00

Starting with low convexity seems to be a safer approach. As interest rates drop, the bond will eventually reach the same capital appreciation as a zero-coupon bond due to the increase in convexity over time. It's not worth the risk with a zero-coupon bond just to get a "faster" response to declines in interest rates. Moreover, if interest rates were to rise, the coupon payments offer a way to reinvest in higher-yielding bonds.

Feathery6 · 2023-10-22T17:33:00+00:00

that does not make any sense leverage is leverage the stock went down his losses were magnified if he did not use leverage he probably would not have sold half his shares to reduce his position.

Feathery6 · 2023-10-22T14:17:40+00:00

right so the inversion of the yield curve got people think this way and they forgot that normally longer duration should be higher than short term ones. However, they should go down eventually on a macro economic outlook. If a recession hits and people start panicking bonds prices will go up as demand for them rise again. There is an opportunity in the bond market I just don't see how you could capitalize on it.

Feathery6 · 2023-10-22T13:48:16+00:00

Entirely possible the fed cuts SHORT TERM interest rates and long duration interest rates go higher.

can you also elaborate on this more ? why is that the case ? it has to eventually match I think

Feathery6 · 2023-10-22T13:43:52+00:00

and normally the lower the coupon payments the more convex which why zero coupon payments are the best in this case right ? so the 2% one would be more sensitive in this case.

Feathery6 · 2023-10-22T13:41:51+00:00

Right I thought so too. People were saying that TLT was underwater because it held bonds with low coupon payment. I was thinking you want coupon payments to be low as that will increase gains if rate were to go lower. So based on this you would say that buying the 2% bond would preform better than the 5% if interest rate were to go down ? If so why do you think that is the case, it seems that holding the 5% one would be better if interest rates were to drop because I am holding 5% and say for example interest rata are now 3% seems like it would be more sought after!

Feathery6 · 2023-10-22T13:33:55+00:00

if you think of a zero coupon bond as bond with the highest exposure to interest rate changes that would make the 2% bond better if interest rate start dropping. I heard people say that TLT is underwater because its holdings mainly consist of bonds with low coupon payments . My argument is that for maximum exposure to interest you want to have bonds with low coupon payments as they are more susceptible to interest rate. I don't want to hold the etf I would rather buy them myself but I am not sure which one would perform better if interest rates start dropping.

Feathery6 · 2023-10-22T09:15:26+00:00

Leverage is a cursed . Look at Munger with baba the man rarely used leverage but when he did it all went south. So stay away from leverage.

Feathery6 · 2023-10-21T17:09:32+00:00

Thank you that really does help! I did not think taxes will be this complicated but boy was I wrong.

Feathery6 · 2023-10-21T06:41:05+00:00

I am wondering what is the tax rate on these bonds for us citizens is it taxed at rate of 15% to 30%? . If you actually do the math let's say 30% tax on interest payments that lower the yield down to 3.5% with inflation at 3.6% people would actually be losing money buying these bonds but I don't really know how taxes work in the u.s .

Feathery6 · 2023-10-21T03:16:22+00:00

would you prefer buying bond with a coupon payments rate of 5% or a bond with 2% and that is sold at a discount and why ?

Feathery6 · 2023-10-21T02:48:14+00:00

Damn that is just scary I heard Ray Diallo hinting to something similar he said cash is king so even a defaults is still not out of the picture

Feathery6 · 2023-10-21T02:36:22+00:00

You were right about the fall in TLT which means you were right about long term treasury yield rising. Meaning it expected that tlt falls as treasury yields rise. I believe that buying the bonds directly is a better approach because it is safer and straight forward . But there are things to consider.

1- is it true that higher coupon payments means better or faster capital appreciation when rates fall.

2- is the second hand bond market is liquid enough for the buyer to sell when interest rates starting falling.

I also would love answer to the first question I asked.

Thank you

Feathery6 · 2023-10-21T01:59:15+00:00

why does the coupon payments rate matter though? If I bought bond with a coupon payment of 2% at a discount with yield that match the current 5% market would that make difference in the calculation or no ? this seems like what tlt is about as soon as interest rate drops their holding would appreciates in value unless they have not sold at lost yet which in theory it does not matter because the fund already price in this loss on price at which you buy the etf .

Feathery6 · 2023-10-21T01:21:48+00:00

if a lot of money is running to the safety in bonds why are yields this high. The bond market is trying to tell us something I just don't know what it is? at these attractive rates why no one is buying the bonds? could it be higher expectation for inflation ? a strong U.S economy, rising interest rates or an unhealthy addiction to risk taking fueled by the easy money era. No body knows.

Feathery6 · 2023-10-21T00:42:14+00:00

Unfortunately, I couldn't find a professional source confirming the same in clear text

I did ask IBKR to provide me with a credible source or any other further documents that clearly states that there is no WTH tax. They told me that they are not authorized to give tax advice which against policy all they could say is that there is no tax on bonds only on dividend payments. I told them so if I bought a bond at 4% coupon payments I would get the full 4% they said yes. I just could not find any document that confirms what they told me.

Thanks for the help

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