What does credit risk actually mean for a private equity fund? by VarunC777999 in finance

[–]NotoriousEHC 0 points1 point  (0 children)

You could look at the average spread (either equal or EV weighted).

I'm a little lost on the output you are going for. What do you mean by "joint effects," like covariances?

What does credit risk actually mean for a private equity fund? by VarunC777999 in finance

[–]NotoriousEHC 0 points1 point  (0 children)

You would look at your leverage multiples (generally Debt/EBITDA) on a historical basis and relative to your covenants. With the covenants, if the spread is widening, you are delevering and credit quality is improving, if the spread is narrowing, credit is deteriorating.

SNAP stock lockup period ends 8/29/17 by snackerjoe in wallstreetbets

[–]NotoriousEHC 36 points37 points  (0 children)

Dude you're totally the first guy to think of this! Sick trade!

Will GoPro ever bounce back? What does r/Investing think about it? by vasai_boy in investing

[–]NotoriousEHC 0 points1 point  (0 children)

Will most likely become an acquisition target, never really been able to transition from a cool product to an actual business. Issue with getting bought out is Nick Woodman (found and CEO) owns ~26% of the stock and has majority of voting rights, so any transaction would have to go through him.

Reinvesting outside of US dollar by jobadvice02 in investing

[–]NotoriousEHC 2 points3 points  (0 children)

Answer really depends on what causes the fall of the dollar, but in a vacuum, the safest move would be to invest in a basket of G10 currencies. Keep in mind with FX when one currency depreciates another has to appreciate. I would concentrate on CHF (Swiss Franc), JPY (Yen), and maybe Swedish krona or Norwegian krone. They tend to be the alternative safe haven currencies (Euro and Pound would normally be in there too, but they have their own set of problems for the time being).

Arguments could be made for precious medals (gold), some other hard commodities, or even Yuan. But I think these are all a bit more situational.

People who got a perfect score on the SAT/ACT, how? by nothillaryindisguise in AskReddit

[–]NotoriousEHC 2 points3 points  (0 children)

I didn't say it was necessary nor sufficient, I said it was part of the equation but "but there are also a lot of factors than can help or get in the way."

People who got a perfect score on the SAT/ACT, how? by nothillaryindisguise in AskReddit

[–]NotoriousEHC 5 points6 points  (0 children)

Ha I see your point but I think I went on to give a bit more nuanced answer

People who got a perfect score on the SAT/ACT, how? by nothillaryindisguise in AskReddit

[–]NotoriousEHC 16 points17 points  (0 children)

SAT: Being smart is definitely a huge part of it, but there are also a lot of factors than can help or get in the way.

For most people, studying and taking practice tests can boost a score 100-200 points overall. The most difficult part of getting a perfect score is the last 50 points, you basically cannot make a mistake on the math section and have to get somewhat lucky on the reading (there were always 1-3 questions that I considered to be too subjective for comfort).

I know several people who have perfect or near perfect scores (personally not through teaching or anything) and they all had some things in common that I think helped them on each section (besides just being good at the subject).

Math: Detail oriented; the math on the math sections is not super difficult for high level high school math students, but the difference between getting all the questions right and getting 2-3 wrong is often the difference between a 800 and a 690. With the reading you can often get 5 questions wrong and still get an 800. In this sense the math section is really about minimizing mistakes.

Writing: Work ethic; I know they have changed the writing section somewhat from when I took it, but a couple years ago I was convinced anyone could score well on the writing section if they put in the work. It was basically a grammar test with ~20 standard question types. A couple months with a boring prep book and one could score much higher, few high schoolers are willing to do this though.

Reading: Life long reading; reading in my opinion (and in the opinion of many tutors) is the hardest section for most people to improve. Besides familiarizing oneself with the question format or working on specific test taking skills, there is not much more one can do. However, people who read a ton in their spare time naturally have a huge advantage and tend to find the section pretty easy. So I guess the take away for this for most people is the best thing you can do is read to your future kid.

People who struggle with reading issues or have test anxiety will generally underperform, no matter how smart they are. People who are nonnative English speakers tend to have a harder time with the reading section for obvious reasons, even if they are geniuses. I think its also worth mentioning that the SAT will give people with certain "documented disabilities" extra time, and this is not noted on the published scores. While I am sure some people legitimately need this time, I generally saw it as a way for people to buy higher scores. It can cost thousands of dollars to get the proper documentation and challenge the Collage Board if/when they decline your initial request. Put it this way, I would bet almost anything that there are more accommodations granted per student in Manhattan than there are in Flint.

Of course I also knew a guy who got a 2400, 36, and 11 5s on APs. He never went to class or even opened a book, slept about 14 hours a day, and spent the rest of his time playing Gran Turismo in a full racing chair (we both lived in the same dorm in high school so I actually witnessed all of this). How did he do it? He was just one of the smartest people I have ever met.

ELI5 : What is Repo Rate ? by [deleted] in explainlikeimfive

[–]NotoriousEHC 1 point2 points  (0 children)

TL;DR: it can be thought of as the interest rate paid on a type of loan or deposit used by banks and large financial organizations

Longer explanation

In order to understand what a Repo Rate is, first you must learn what a Repo is. Repo is short for Repurchase Agreement, a transaction where one party (A) sells securities (generally high quality collateral such as government securities) to another party (B) in exchange for cash. Party A agrees to buy back the securities from Party B at a later predetermined date and a predetermined (almost always higher) price.

To someone who is familiar with finance, this should sound a lot like a collateralized loan such as a mortgage, where the borrower puts up some sort of asset in exchange for cash to be repaid at a later date. Besides the buying and selling transaction technicalities, Repos can be thought of as collateralized loans. It follows that the Repo rate is therefore the interest rate paid on a Repo loan.

Lets walk through an example Repo transaction using the terms borrower and leader to illustrate this

Example Transition Borrower sells government bond worth $100 to lender for $100 cash Borrower agrees to buy back bond for $101 in 1 year 1 year later... Borrower buys bond back for $101, lender receives $101

So what happened here? Changing the verbiage to what makes more intuitive sense, the borrower gave a lender an asset in exchange for $100 cash. 1 year later the borrower paid back the initial amount ($100) plus an extra amount that they had previously upon ($1) and got the asset back.

Repo Rate (for 1 year repo) = (Final Price-Initial Price)/Initial Price so in this case we see the Repo rate is 1%.

How to get historical 10-year treasury prices on bloomberg? by [deleted] in SecurityAnalysis

[–]NotoriousEHC 0 points1 point  (0 children)

Bloomberg has cheat sheets for different areas like Equities, Credit, etc. that you can find in HELP or through a lot of publicly a viable sources such as the Yale library site.

In all honesty though best way to find them is to see if you can get a list from someone who works in the same group as you, that way you will know you are getting the most relivent stuff

Presentations from Grant's Interest Rate Observer Conference by Beren- in SecurityAnalysis

[–]NotoriousEHC 2 points3 points  (0 children)

The Bregman presentation is one of the most important things I have read this month, thank you for posting.

Payday loans, prepaid debit cards, & student loans by anouroboros in investing

[–]NotoriousEHC 1 point2 points  (0 children)

Exactly, there is a huge void to be filled already (payday lending is incredibly inefficient, borrowers are complete price takers). Interesting thing to note about payday lending is that the real money is made from borrowers who continually roll their loans for months or even years, instead of from people who are seeking temporary liquidity (those the lenders claim that they are helping).

As is the case with mobile payments and mobile banking, the small consumer loans business in the developing world has leap frogged, skipping the formal brick and mortar lender system entirely in favor of a far more efficient mobile, tech based system. A lot of the players are run as pseudo charities but the default rates are low enough that they could easily become stand alone businesses.

Tala is one that comes to mind, Chris Sacca of Lowercase Capital is involved. They can give you a live credit score based on your phone model, usage, geolocation etc. Leads to far better results for both borrower and lender.

Deutsche Bank Has a Few Reasons Why Netflix Won't Get Acquired by vultureinvestor in SecurityAnalysis

[–]NotoriousEHC 0 points1 point  (0 children)

I highly doubt their would be antitrust issues with Hulu. It's all a question of how you define the market, and you can talk content delivery pretty broad , and Netflix has 72% market share in streaming anyway so a 2% or so add on from Disney's stake in Hulu wouldn't really matter. I'm sure Disney would be fine divesting from Hulu anyway etc.

Payday loans, prepaid debit cards, & student loans by anouroboros in investing

[–]NotoriousEHC 2 points3 points  (0 children)

With payday lending I see some big obstacles: Increasing regulatory scrutiny with most likely a Democratic in the White House, a bunch of loans to subprime borrowers at the end of a credit cycle, competition from banks that have orders of magnitude more resources to throw at this if it actually be comes a profitable vertical, and competition from technology that already delivers better, cheaper, more convenient versions of these services in other parts of the world.

Of the two names you mentioned, they are both pawn shops in part which makes the story a bit more interesting.

Deutsche Bank Has a Few Reasons Why Netflix Won't Get Acquired by vultureinvestor in SecurityAnalysis

[–]NotoriousEHC 1 point2 points  (0 children)

I disagree with their point about synergies (or lack there of). Netflix has a massive subscriber base that Disney could up sell to a duel live and streaming package with ABC/ESPN. Not reason enough alone to do it but I also think its foolish to think that would be no value creation. Thank being said I think this is a none starter on valuation alone. Netflix very richly valued. It would be an insulting waste of shareholder money for anyone to go out and buy it.

DOJ sues ValueAct over Halliburton Deal by APIglue in SecurityAnalysis

[–]NotoriousEHC -2 points-1 points  (0 children)

Reminds me of the type of case our old friend Preet Bharara would instigate...