Margin Account Vs Cash: Which is Better for You

Margin Account Vs Cash: Which is Better for You
Cash Account vs. Margin Account: What Is the Difference?
What's the difference between margin and cash account?
Cash vs Margin Brokerage Accounts - The Balance
Margin Account vs Cash Account: What's Best for You

Cash/Margin Account vs. RRSP Trading

Hi - I don't want to use my TFSA to make day/swing trading income due to risks/CRA. But is it better to trade inside my RRSP or Cash account? RRSP - my gains will be taxed like income come RRIF which I don't think is fair- CRA should only tax contributions but that's life...I can make $200-$3000 every week in capital gains. Thanks

submitted by donksky to PersonalFinanceCanada [link] [comments]

Cash vs Margin Accounts and Day Trade Limits of Each.

submitted by MoarGPM to Webull [link] [comments]

Margin vs cash trading question

If my account requires margin and I have cash in my account... then am I still paying interest?

submitted by 1111rob to OptionsOnly [link] [comments]

Cash vs Margin account for day trading on IB?

Newbie here, been "day trading" (sort of) on Robinhood for the past few weeks. Ran into the issue of being marked as PDT and blocked from selling certain stocks I had recently purchased.
Considering:
-I am starting with a small account balance of $1.5-2k
-I am trying to save as much in fees as possible to keep my daily percentage gains high (reason why I decided on IB as my new broker)
-I would like to have account deposits/withdrawals go thru as quickly as possible (preferably the same day I deposit)
-(Not as important as the above requirements) Would like to have the option of trading options (pun intended)
It would be better to go with a cash account right? Or are there benefits to day trading with a small balance margin account that I'm not seeing? Thanks in advance for the advice!

submitted by makeshiftbakedkids to Daytrading [link] [comments]

Got flagged as PDT on a cash account, can I still trade?

Hi, I recently made too many day trades on my cash account without letting the cash settle. I was informed that my account has been flagged and I can’t day trade for 3 months or raise my account to 25K.
Does this mean no day trading at all or I can still do so with settled cash?

submitted by k_dot33 to RobinHood [link] [comments]

Margin Isn't Dangerous & Why I'd Still Use It If I Had Less Than $25,000

Cash vs. Margin

TL;DR- Use Margin if you're trading securities and either above or below 25k. If you know how to size positions, it won't matter if you move $4,000 into a trade or $4,000,000. As long as you sized the position correctly. If you're limited to 3 trades, then take 3 PERFECT trades: https://imgur.com/a/SpPOERQ

I see lots of people discussing contrasting ideas although they attempt to justify using both. Here are some things I see said and written frequently from people that doesn't add up for me:

"Use a cash account to avoid PDT" - (Totally fine, in some cases such as certain options traders. Not if you're trading securities.)
"Risk 1% of your account" - (So if your account is at $25,500, I risk ~$255 and if I lose 2R I'm below PDT. Doesn't sound too great to me if I were to lose the first 2 straight trades.)
"Margin is a double-edged sword" - (It's only dangerous if you don't set hard stops or size your positions correctly.)
"Never take on a trade that is worth more than your account" - (I can agree if you were swing trading but in terms of IntraDay trading, this is hindering your ability to grow your account. If you're risking $100 on a trade that costs less than your account value.. then $25 on a trade because of your account value.. then you're adding unneeded variables. Remember: "Consistency.")

The Predictive Model I built lays out all valid trades within the report range as well as \"Perfect Trades\" that I consider \"Textbook\". The report range is between a 30 day range. Between 4-17-20 to 5-17-20. Total \"Perfect Trade\" count is 9 trades. Even if I were limited to 3 trades per week. I'd be able to trade them with less than 25k on margin. The stats reflect $100 risk I've set on a different tab. (The \"W\" is just a graphic I made for \"Winning\")

It doesn’t matter if you move $4,000, $40,000, or $4,000,000 into a position. As long as you’re risking the same. Your Trading Account's performance is based off of risk. Such as:
•Sharpe ratio
•RRR
•Number of R’s in 1 week/month/quarter. (Example: I made 7R this week. If my R is $100. I made $700)

If I were to go back to when I was below $25,000 some years ago. I'd still use a margin account while being limited to 3 trades per week. Here's why:

Formulas you have to know:
Position size formula = Risk ÷ Stop Size
Stop Size Formula = Entry - StopLoss

Example 1a:

Stock ABC,
Entry = $10.00
StopLoss = $9.90
StopSize = 10¢
Risk = $100
In Live Trading: $100 ÷ $0.10 = 1000 Shares
1,000 shares at $10.00 = $10,000 position

Example 1b:

Stock XYZ,
Entry = $385
StopLoss = $383.00
StopSize = $2.00
Risk = $100
In Live Trading: $100 ÷ $2.00 = 50 Shares
50 shares at $385 = $19,250 position.

*$10,000 CASH account: CANNOT trade Stock XYZ and must wait 3 days for his entire account to settle after trading Stock ABC. If it was a margin account, they'd still be able to take 2 more trades this week.
*$10,000 MARGIN account: CAN trade Stock XYZ and can trade both scenarios while still able to trade 1 more time in a 5 day rolling period.

Then the next point made is, "Just won't trade anything above $20".

Ok. great rebuttal, but why?

Let's remember this: StopSizes aren't always directly correlated to the price of a stock. YES you're more likely to have a wider StopSize on a higher priced stock and a tighter StopSize on a lower priced stock. But remember this: 1¢ of slippage on 1,000 shares is 10% of his risk ($10)... It will be even more slippage if his stop loss market order is hit. Even a Sell-StopLimit order will have slippage within the amount you allow for when you enter a position.
Stock XYZ would have to be slipped 20¢ just to equate the amount of slippage on Stock ABC.Highly liquid and available stocks such as AAPL, AMD, NVDA etc don't have 20¢ spreads. Not even 10¢. Rarely 5¢. Most of the time. Just a couple cents. Of course there could be more right out of the open but the spread in my years of experience is tightened within 2 minutes of the open.
Yes, these small amounts in pennies do hold lots of merit if you're looking at having any longevity in this business, it WILL add up over the years.

Both trades have the same risk [in perfect world theory].

If both stop market orders were hit (StopLoss). Both traders would exit with a $100 loss on each. Although 1 trade required $10,000 in capital and the other trade required $19,250 in capital.
Use margin. If I had to go back to when I had less than $25,000 in my account, I'd still do it the same way I did it with margin. I highly suggest using margin even if you’re limited to 3 trades per week. I get asked all the time when I began trading. If you watched my last video, I showed my first ever deposit with Scottrade (Old brokerage that was bought out by TDA a few years ago) in 2015 although I don't consider that's when I started trading because I didn't treat it the way I do today.
I really consider myself starting as a trader in 2017 when I:
•Wrote a business plan
•Understood statistics
•How to research.
All this being said, slowly over time I noticed that I am taking less and less trades and increasing my risk size. Why?
EV: Expected Value.

- Margin has zero negative effect if you're sizing your positions the same every time. Margin allows you to take on more expensive positions that are showing your edge.

Bonus: Being limited to 3 trades a week isn't fun, I remember that feeling from years ago. Just remember to take 3 perfect trades a week. Sometimes "Perfect Trades" don't work out in your favor while some subpar situations hit target. Some weeks you might take your 3 "Perfect Trades" by Tuesday. Some weeks you might take only 1 "perfect trade". If you follow my watchlists on Twitter (Same handle as my Reddit), I keep my Day Trading Buying Power transparent. Not always is it growing perfectly linear. And not always am I posting every single day because sometimes, my edge isn't there. Just because the market is open doesn't mean you HAVE to trade.
My watchlists aren't littered with 15+ tickers. Rarely do they have more than 7. That may work for other traders, but for me, I demand quality. It's either there or it isn't. No reason to force a trade. I'd rather focus heavily on a few tickers rather than spread myself thin across multiple.
Trading isn't supposed to be exhilarating or an adrenaline rush. It can be boring. I said that in the post I wrote back in April.
Also if you make money, even if its just $20 in a month. Take that money out and buy something. Shrine it. Cherish it. You ripped that money out of WallStreet. Be proud of it. It takes a lot of courage to do this business. Realize that the P/L is real money. Sometimes even just buying a tank of gas or a book will help you realize that. Spend it from time to time. Get something out of your trading account. You may or not be trading for long, get something that is tangible to always remember the experience in case you don't last. Make it your trophy.

That's all I've got for right now. Maybe I'll make another post or 2 before the year ends. I hit my 1 year full-time mark in September.
Best wishes!
-CJT2013

submitted by CJT2013 to Daytrading [link] [comments]

$PSTG: PURE STORAGE for them, PURE TENDIES for you

This is actually my first DD I've ever posted so fuck you and forgive me if this doesn't work out for you.I've been looking at $PSTG for a while now and if my buying power didn't get so fucked from my decision to buy 8/7 UBER puts, I would have been already all over this play.
What had got me looking into Pure Storage was an unusual options activity alert. I've looked into this company before but didn't entirely understand what they do. Now after looking at them again, I'm still not exactly sure wtf they do....BUT I've gotten a better clue. Basically what I got from my research is that these guys fuck with "all-FLASH data storage solutions (enabling cloud solutions and other low-latency applications where tape/disk storage does not meet the needs)."......and ultimately what this all means to me is that these are the motherfuckers making those stupid fast laser money printers with the rocket ships attached. And that's something I'm interested in.
Now, here is the D^ailyD^ick you all degenerates have all been fiending for:
Fundamentally: PureStorage remains one of the few hardware companies in tech that is consistently growing double motherfucking digits, yet remains constantly cucked and neglected by investors (trading at 1.9x EV/Sales).
https://preview.redd.it/ek7ugjsewnf51.png?width=1118&format=png&auto=webp&s=f9c7e72c95e450a105e44223937422d896eeeb21
The 36 Months beta value for PSTG stock is at 1.62. 74% Buy Rating on RH. PSTG has a short float of 7.28% and public float of 243.36M with average trading volume of 3.16M shares. This was trading at around $18 on Wednesday 8/5 when I started writing this and as of right now, it's about $17.33 💸
The company has a market capitalization of ~$4.6 billion. In the last quarter, PSTG reported a ballin'-ass profit of $256.82 million. Pure Storage also saw revenues increase to $367.12 million. IMO, they should rename themselves PURE PROFIT. As of 04-2020, they got the cash monies flowing at $11.32 million . The company’s EBITDA came in at -$62.81 million which compares very fucking well among its dinosaur ass peers like HPE, Dell, IBM and NetApp. Pure Storage keeps taking market share from them old farts while growing the chad-like revenue #s of 33% in F2019, 21% in F2020, and 12% in F1Q21.
Chart of their financial growth since IPO in 2015:
https://preview.redd.it/gwlmy82v4nf51.png?width=640&format=png&auto=webp&s=b6508cd5f641da4086b70d8b8007da034e982fd7
At the end of last quarter, Pure Storage had cash, cash equivalents and marketable securities of $1.274B, compared with $1.299B as of Feb 2, 2020. The total Debt to Equity ratio for PSTG is recording at 0.64 and as of 8/6, Long term Debt to Equity ratio is at 0.64.Earning highlights from last quarter:

Revenue $367.1 million, up 12% year-over-year
Subscription Services revenue $120.2 million, up 37% year-over-year
GAAP gross margin 70.0%; non-GAAP gross margin 71.9%
GAAP operating loss $(84.9) million; non-GAAP operating loss $(5.4) million
Operating cash flow was $35.1 million, up $28.5 million year-over-year
Free cash flow was $11.3 million, up $29.0 million year-over-year
Total cash and investments of $1.3 billion

I bolded the Subscription Services Revenue bullet because to me that's a big deal. Pure Storage keeps them coming back with products such as Pure-as-a-service and Cloud Block Store and everybody knows that the recurring revenue model is best model. Big ass enterprises buy storage from vendors such as Pure Storage in the cloud to prevent vendor lock-in by the cloud providers. $$$ >!💰<
What are Pure Storage's other revenue drivers? Well these motherfuckers also have the products to address the growth of Cloud storage as well as the products to drive the growth of on-prem storage. For on-prem data center, Pure sells Flash Array to address block storage workloads (for databases and other mission-critical workloads) and FlashBlade for unstructured or file data workloads. On-prem storage revenue is mainly driven by legacy storage array replacement cycle.
https://preview.redd.it/01su6chrwnf51.png?width=1129&format=png&auto=webp&s=16e6a705f9392291bc0c3932c815802d9101365e
So far, it seems like Pure Storage's obviously passionate and smart as fuck CEO has been spot on with his prediction of the flash storage sector's direction. Also seems like he's not camera shy either. Pure Storage's "Pure-as-a-Service and Cloud Block Store" unified subscription offerings is fo sho gaining momentum it. This shit is catching on with enterprises, both big and small. COVID-19 increased the acceleration of our digital transformation and the subsequent shift to the cloud. This increased demand in data-centers is going to drastically help Pure Storage's future top and bottom line. To top it off, NAND prices are recovering! (inferred from MU earnings). I expect Pure Storage to get some relief on the pricing front because of this which obviously in turn should improve revenues.
PSTG's numbers look pretty good to me so far but are they a good company overall? Even when scalping and trading, I don't like to fuck with overall shitty companies so I always check for basic things like customer satisfaction, analyst ratings/targets, broad-view industry trends, and hedge fund positioning.. that sort of thing.Pure Storage stands out in all of these fields for me.
https://preview.redd.it/4n0e5nve5of51.png?width=373&format=png&auto=webp&s=495416bb6f5a2dab77f3ac483ca4d9510b39037c
Customers like Dominos Pizza and many others all seem to be happy AF with no issues. I can hardly even find a negative review online. Their products seems to be universally applauded. Gartner and other third party independent analysts also consider Pure Storage's product line-up some of the best in the industry.
The industry average for this sector is a piss poor 65.Pure Storage has a 2020 Net Promoter Score of 86
https://preview.redd.it/3w51io8yvmf51.png?width=698&format=png&auto=webp&s=4f7d06825d0ad9d126216e5069af2f9c3636f86a
Enterprises are upgrading their existing storage infrastructure with newer and more modern data arrays, based on NAND flash. They do this because they're forced to keep up with the increasing speed of business inter-connectivity. This shit is the 5g revolution sort to speak of the corporate business world. Storage demands and needs aren't changing because of the pandemic and isn't changing in the future. The newer storage arrays are smaller, consume less power, are less noisy and do not generate excess heat in the data center and hence do not need to be cooled like the fat fucks at IBM need to be. Flash storage arrays in general are cheaper to operate and are extremely fast, speeding up applications. Pure Storage by all accounts makes the best storage arrays in the industry and continues to grow faster than the old school storage vendors like bitchass NetApp, Dell, HPE and IBM.
Pure Storage’s market share was 12.7% in C1Q20 and was up from 10.1% in the prior year - LIKE A PROPER HIGH GROWTH COMPANY.HPE, NetApp and IBM, like the losers they are, lost market share.According to blocksandfiles.com, AFA vendor market share sizes and shifts are paraphrased below:

“Dell EMC – 34.8% (calculated $766m) vs. 33.7% a year ago
NetApp – 19.3% at $425m vs. 26.7% a year ago
Pure Storage – 12.7% at calculated $279.7m vs. 10.1% a year ago
HPE – 8.4% – $185m vs. 10% a year ago"

Pure has been gaining marketshare almost every year since it began selling storage arrays in 2011. Pure Storage is consistently rated the highest for the completeness of vision as this chart shows:
https://preview.redd.it/5agj17gcgnf51.png?width=428&format=png&auto=webp&s=da9c6389baccab85261d6e0f71b3474e84b90d3c
Hedge Funds are on this like flies on shit.
Alliancebernstein L.P. grew its position in Pure Storage by 0.5% in the 4th quarter. Alliancebernstein L.P. now owns 104,390 shares of the technology company’s stock worth $1,786,000 after purchasing an additional 560 shares during the last quarter.
Legal & General Group Plc grew its position in Pure Storage by 0.3% in the 1st quarter. Legal & General Group Plc now owns 258,791 shares of the technology company’s stock worth $3,213,000 after purchasing an additional 753 shares during the last quarter.
Sunbelt Securities Inc. acquired a new stake in Pure Storage in the 4th quarter worth $4,106,000.
CENTRAL TRUST Co grew its position in Pure Storage by 79.8% in the 2nd quarter. CENTRAL TRUST Co now owns 3,226 shares of the technology company’s stock worth $56,000 after purchasing an additional 1,432 shares during the last quarter.
Northwestern Mutual Wealth Management Co. grew its position in Pure Storage by 203.0% in the 1st quarter. Northwestern Mutual Wealth Management Co. now owns 2,312 shares of the technology company’s stock worth $28,000 after purchasing an additional 1,549 shares during the last quarter.
Also, everybody's favorite wall street TSLA bull, Cathie Wood has been busy steadily purchasing big lots of PSTG for her ARK ETF funds for a while now...Even going as far as selling TSLA in order to re-balance!
https://preview.redd.it/zjxuakjosnf51.png?width=1125&format=png&auto=webp&s=f34abdd3b35791eb207d31d72ea0f6fb11beec30
https://preview.redd.it/bkf1uzb2tmf51.png?width=2048&format=png&auto=webp&s=a9870ec41cfb4ce468ba61d83f2f8a4151927a4e
Hedge funds and other institutional investors own 78.93% of the company’s stock and it seems like more are piling in every day.
Tons of active options, too -Pretty good volume lately with the spreads looking decent.
Over 5,000 September $20 Calls added just on 8/3 alone 🤔
Order flow helps my thesis here, showing a recent influx of big dick money moving into PSTG.
https://preview.redd.it/liychuhblnf51.png?width=592&format=png&auto=webp&s=ca6a60d54a9eb8bd9e32e0ef70992b8282c29e70
Google Search Trends showing uptick in interest: ^{SPY420 baby}
https://preview.redd.it/joo0b9wxinf51.png?width=1710&format=png&auto=webp&s=24eb18f18be18b9b771ff1911c09c5479ba2f1a0
Robinhood Trends showing the YOLO is trending up
https://preview.redd.it/4gk5yjdxmnf51.png?width=1538&format=png&auto=webp&s=76c4b114c133c493c84386d1705f85229f5f7d44
Increased job postings on LinkedIn all across the globe, further supporting the idea that Pure Cloud Adoption is looking strong.
https://preview.redd.it/5zenasprznf51.png?width=1092&format=png&auto=webp&s=a492e227e2208fe89925c9b7fe365634f7ffde6a
Technically: This broke out through down-trend line a couple of days ago and as of right now looks to be pretty oversold. Looks like its found support at the 50 DMA and zooming out , the chart just looks like to me that it's coiling up for a big breakout.
https://preview.redd.it/wxtz8minmnf51.png?width=1208&format=png&auto=webp&s=7baabbd3e8f97dfc8bd0d5bfa512613c2eea4921
These fucking shorts are going to get squeezed out hard. Potential short squeeze coming?
https://preview.redd.it/lh8lp08funf51.png?width=1533&format=png&auto=webp&s=921b6684369e25e94f00ed96a404458028e540c8
**So what's the play?**I'd like to see RSI break out of the downtrend and the divergence between price & momentum ends at some point. If/when RSI breaks out, I want to play this thing aggressively with bullish call calendar spreads....THAT IS IF I HAD SOME FUCKING BUYING POWER (FUCK YOU UBER)....Soooo really what I'll be doing is asking my wife's boyfriend sometime this weekend for a loan. That way on Monday I can buy some $PSTG 9/18 $17.5 & $20 calls at open and YOLO my saddness away for a week.God forbid, I might even buy of those things called "shares" I heard about from /investing if at all possible because in all honesty, I really do feel like this is a good company to hold in a long term growth portfolio.Pure Storage is NOT looking like your average KODK prostitute to flip or scalp and actually more like someone you'd bring home to your dads.
EARNING DATE: 8/25
Pure Storage has a history of beating estimates and rocketing up. Over the last 20 quarters, the company beat revenue 17 quarters by an average of $4.9 million or about 3%. Out of the three times that the company missed on revenues, once was due to supply fuck-ups at one of its distributors and the other two times were due to Average Selling Prices declining faster than the company forecasted. Higher-than-expected ASP declines (due to NAND oversupply) is one of the risks of the storage business...but then again NAND prices look to be recovering now if MU's earning isn't fucking with us and telling us fibs. Big money is forecasting revenue to be around $396 million, essentially flat year-over-year, and EPS of a disrespectful ass penny....Fuck that conservative ass guidance! I think PSTG is going to blow that shit out the water. This chart shows Pure Storage’s past performance and we all know for sure that past performance = future results.....right?
https://preview.redd.it/4xflpezdhnf51.png?width=623&format=png&auto=webp&s=c1660a80a1a1821ef8098791a8cee632e25f1445
My Prediction: After ER8/25, Pure Storage will hit new 52 week highs.$20.50 - $23.50 is my guess. Bold prediction, $27.50+ by the EOY and $50 by December 2021.
tldr: PSTG 9/18 $17.5 & $20 calls

edit: for those that bought into this, I'm in this with you!
Let's pray for a rebound next week. also, Fuck Cisco!

submitted by OnYourSide to wallstreetbets [link] [comments]

Baseball Card Flipping Project - Part 16

Hey guys!
It has been FOREVER since my last update and a ton has happened. Sorry for the long post, but hopefully some people appreciate a detailed dive into everything.
A really really really brief recap of the past fifteen parts
I started in December of 2018 with $1,165 with the goal of making $10,000 in one year. In 2019, I had bought and sold over $40k in baseball, football and various sports trading cards. I had a few great successes ($1,165 into $3,085 before fees - $2,771.20 into $6,200.10 before fees - $1,086.68 into $3,190.54 before fees) and a few duds. I generally sell my cards on ebay, but utilize auction houses every now and then. The biggest bottleneck I face is submitting cards to PSA (a third party grading company), a card might have a 2-4 month turnaround time. To successfully "flip" you need to balance some of these purchases with shorter flips. In 2019, I ended with a final profit of $9,262.28 – a tad bit short of my goal. In 2020, my goal is $20,000 (fitting). Using my margins from 2019, I would need to sell around $85k in cards.
You can find the previous installment here
PERSONAL UPDATE
First, I hope everyone is doing well and staying sane. It has been an absolutely wild three months for me, I found out I’m going to be an uncle, I got a cat and I decided I was going to propose to my girlfriend this weekend! I have still been keeping up with this project, the prices for baseball cards have absolutely skyrocketed over the past couple months, so there hasn’t been the same amount of buying as usual. I am going insane with working from home and trying to keep my head above water with everything, but flipping has been (at times) a nice escape. I am fortunate enough to be flipping something that I am passionate about, baseball cards, so I am able to enjoy this and see a lot of neat cards along the way.
In that spirit I have decided to begin keeping some cards for my personal collection as I go along. I read somewhere an interesting method of collecting, reducing your collection to 25 cards. I wanted to give it a shot with a bit of a twist, I want to keep a collection of 25 cards, but still make a profit along the way. So a couple ground rules I set for myself: * The collection is limited to vintage baseball cards (generally 1980’s and older). This was my first collecting passion and I’d like to try to keep to it.

The cards need to come from a set/lot that I turned a profit on. You won’t find me buying a single card for the sake of it and I won’t lose money on a lot because I kept the best card.
I will max out the collection at 25 cards. This doesn’t mean I won’t swap out or sell cards along the way, but I won’t ever eclipse 25 cards.

So, without further ado, here are the first four cards in this project. The 1949 Berra came from the Yogi Berra lot I bought from SCP in January. The grades finally came back last week and I did very well on a few cards, so I felt that I deserved to spoil myself a bit. The 1949 Bowman set holds a special spot in my heart for me, my best flip ever was a group of 1949 Bowman cards I purchased for $300 which included a Jackie Robinson rookie that graded PSA 8! I sold it for over $10k. This Yogi Berra card is well centered, nice registration and a great mid-grade example of a baseball icon. I love it. The Ted Williams card and the Willie Mays both came from the December Heritage lot that I had purchased. PSA took FOREVER on this order. I was a little disappointed in the overall grades, but am confident I will turn a profit. The 1956 Topps Ted Williams is such a cool card and a staple in post-war collecting. The Mays I always liked – it’s a little beat up, but the centering is near perfect and the color looks sharp. Finally, I nabbed the 1969 Yaz. This was mostly done because I love the set. 1969 Topps was the last set to feature Mickey Mantle, something that I think goes underappreciated. The set design has always been pretty crisp, it has a couple great rookies and great all-star rookie cards. I’m a fan. Anyways! None of these cards are permanent, I can sell them at any time, but I’d imagine they will be in the collection a while.
Purchased

First up was something completely new to me, I purchased an entire PSA graded set to sell each card individually! At the end of May I bought this beautiful 1961 Topps Set for $5,791.60 after fees. I took a major risk on this because the auction house only showed 12 of 589 cards in the set, with the remaining essentially sight unseen. Usually, when an auction house sell a complete PSA graded set, they provide an excel sheet or link to the grades of each card. It makes a HUGE difference. For example, this set, with every card graded PSA 6 is worth approximately $8,000 the same set graded entirely PSA 7 is worth $13,000. I was hoping that this set was somewhere in the middle. Luckily it was! I sold each and every card individually (less 7-8 that they originally forgot to send and one I sent to PWCC) for $11,445.51, after fees I am going to make a little over $4k, my largest flip in this project to date. This was a ton of work. There are 589 cards in the set; scanning and listing each individually took close to 20 hours over the course of a week. Packaging the cards took another 4-6 here is a picture of the cards packaged. Luckily, with selling a set, plenty of buyers purchase multiple cards (one guy bought over 80). Overall I would definitely try it again, but probably not any time soon.
In July I bought this Aaron Judge rookie card for $1,940 after taxes and fees. The two most common questions I get are whether I ever buy single cards and whether I buy modern cards. The answer is yes, but when the price is right. This card was a steal! I am expecting to easily double my investment on this one, it has already been sent to PWCC.
Finally, I bought this group of signed cards at Lelands for $1,364.40. Many of these signatures are tough to get since the players died young. Lyman Bostock died at the age of 27 in a shooting, Nellie Fox (a Baseball Hall of Famer) died at the age of 47 from cancer and Steve Macko also at the age of 27. It’s kind of a strange and morbid auction offering. I bought the group and quickly sold the the Macko for $700, the 1965 Stengel for $225 and the 1965 Howie Reed for $195. I think the only card I would be interested in keeping from here would’ve been the Stengel, but I may hold on to one for my collection.

What Sold

I FINALLY decided to list the rest of the wrappers at $.99 auction. They sold, bringing in around $1,500, led by the 1962 Fleer football wrapper. Overall, I was a little disappointed in the auction, but very happy with clearing out the inventory. Between the two wrapper lots, I made close to $2k.
I listed the last of the Huggins multi-sport group that I bought in November. Those cards came back with pretty decent grades, I consigned a few cards to PWCC, led by the Dick Butkus rookie, which sold for $1,125. With that sold, it leaves me left with just the 1951 Topps wax pack which is still with PSA. Hopefully that comes back authentic.
The B14 blankets still aren’t really moving that quickly. I sold four over the past two months. I may try to list these at auction, I’m in no rush.
I sold another one of the 1947 Bond Bread Jackie Robinson cards for $900. I sent the rest to PWCC.
The grades came back surprisingly quick for the 1954 Topps cards I purchased. I sold off the ungraded cards for $182.50 and the 1954 Topps Ted Williams Gray Back for $525. I essentially have broke even and still have the Hank Aaron rookie and Ernie Banks rookie to sell. Both are with PWCC.
PWCC also sold the 1973 Topps cards that I had sent them, bringing in an astonishing $4,340! It was led by the 1973 Joe Morgan, which sold for $1,185. I have cleared $3,483 on this group and still have 83 cards with PSA! This will be a great flip.

PSA Update
Here is a link to the Google Doc with the status of all of my PSA cards. The spreadsheet also includes a summary of where the project is.
PSA is still extremely backlogged. For this project, I have 276 items with them. Luckily I was able to get quite a few cards back from them recently! As I previously mentioned, I received back the Yogi Berra cards I sent them in January and the Heritage cards I sent in December. Overall I am happy enough with the grades. I think they were fair on the Berra cards and they were rough on the Heritage cards (they were separate orders). I already listed or consigned these cards, so I will have updates next month on these.
Below is an updated summary:
For items purchased in 2019 (denoted with a “*”), the “cost” column represents the ending 2019 inventory valuation. For items purchased in 2020, the cost column is the cost. In the Google Sheet I included an in-depth P&L with full results and 2019 details.

Item	Cost*	Sold	Fees	Inventory^	Profit
1936 Goudey Lot (8)	50.00	56.50	(8.48)	-	(1.98)
Hank Aaron "Odd-Ball" Collection	150.00	777.29	(116.59)	-	510.70
(16) Pre-WWII card lot w/ Cobb	1,300.00	1,708.52	(256.28)	-	152.24
(23) Sandy Koufax 1950's and 1960's lot	250.00	299.50	(44.93)	-	4.57
1977-1979 Topps Baseball Rack & Cello Packs (6)	250.00	380.00	(57.00)	-	73.00
1957 Swift Meats Game Complete Set (18)	800.00	680.00	(102.00)		(222.00)
(36) 1950s-2000s Multi-Sports Collection	500.00	1,528.51	(229.28)	-	799.23
1933-1989 Wax Pack Wrapper Hoard (650+)	400.00	1,918.01	(287.70)	-	1,230.31
1941-2004 Multi-Sport Group (33)	800.00	2,859.83	(428.97)	100.00	1,730.86
1912 B18 Blanket Find (100)	1,270.80	1,136.24	(170.44)	500.00	195.00
1962-63 Parkhurst Hockey Lot (45+)	500.00	287.26	(43.09)	400.00	144.17
1953 to 1969 Mickey Mantle Group (16)	1,000.00	2,747.85	(412.18)	150.00	1,485.67
1956-1959 Baseball Star Collection (48)	1,130.00	322.04	(48.31)	900.00	43.73
1961-1969 Baseball Star Collection (61)	804.95	257.78	(38.67)	600.00	14.16
1948-1965 Yogi Berra Collection (26)	1,400.00	399.50	(59.93)	1,050.00	(10.43)
Lot of (4) Signed Perez-Steele Postcards	676.59		-	676.59	-
1950's-1980's Football Wrapper Lot (42)	920.00	1,944.23	(291.63)		732.60
1953 Topps Partial Set (208)	1,472.00	2,855.13	(428.27)	100.00	1,054.86
1953-55 Dormand Postcard Set (47/52)	685.00	804.85	(120.73)	250.00	249.12
1959 & 1960 Venezuela Topps Lot (34)	216.00	58.66	(8.80)	200.00	33.86
1959 Topps Baseball High Grade Set	1,557.30	1,132.80	(169.92)	1,000.00	405.58
1970 Topps Super Proofs Lot (12)	405.41	493.75	(74.06)	200.00	214.28
1887 Allen & Ginter Boxing Lot (14)	403.40			403.40	-
1954 Topps Starter Set (119/250)	662.22	707.50	(106.13)	500.00	439.16
1947 Bond Bread Jackie Robinson Lot (6)	2,220.00	2,125.00	(318.75)	1,480.00	1,066.25
1934 R310 Butterfinger Ruth & Gehrig Lot (2)	720.00			720.00	-
1959 Topps Baseball Near Set (571/572)	3,620.00			3,620.00	-
1973 Topps Complete Set	2,512.40	6,347.41	(952.11)	600.00	3,482.90
1961 Topps PSA Graded Set	5,791.60	11,445.51	(1,716.83)	100.00	4,037.08
2013 Bowman Chrome Judge Black Wave Auto	1,940.00			1,940.00	-
1961-1982 Signed Card Lot (19)	1,364.40	1,120.00	(168.00)	800.00	387.60
	35,772.07	44,393.67	(6,659.05)	16,289.99	18,252.54

*-denotes inventory purchased in 2019 valued at 2019 y/e figures. ^ -inventory on hand is valued at a conservative estimate of fair market value for remaining items. `-grading fees are expensed when the card is sent to PSA, fees are not paid until PSA has completed the order. Fees that are expensed, but not paid are sitting in Accounts Payable below.
2020 Grading Fees`: $2,944.79
Current On Hand
Cash: $5,588.15
Inventory See the Google sheet
ALSO! If anyone is interested in what the financials for this project would look like, see below. With 2019 officially in the book, I moved the final 2019 financial statement over for a year-over-year comparison:

As of 8/25/2020	2020 YTD	2019 Final
Cash	$5,588.15	$1,680.15
Accounts Receivable	$6,743.43	$-
Inventory^	16,289.99	$10,605.75
Accounts Payable`	($2,886.54)	($1,858.62)
Retained Earnings	($9,262.28)	$-
Initial Capital	($1,165.00)	($1,165.00)
Revenue	($44,393.67)	($40,163.15)
Cost of Goods Sold	$19,482.08	$22,582.96
Fees (15% of Rev.)	$6,659.05	$5,956.97
Grading Fees	$2,944.79	$2,360.93

FORECAST
My goal is $20,000 profit for the year. Right now I’m $15,307.75 – PSA has dramatically slowed turnover, but I am definitely on pace to hit my goal, gross margins are up in 2020 compared to 2019 (56.1% vs. 43.8%) and net margins are also up (34.5% vs 23.1%). Sales more than doubled since the last installment and with orders finally coming back from PSA, I should continue to see steady sales.
I look forward to continuing to update everyone on this. Hope you enjoy as much as I do.
Jason

submitted by MachiavellianFuck to Flipping [link] [comments]

Beating the UK brokerage via true arbitrage - £8k -> £98k ($128k) since 21st April

Alright you American autists, here's a gains post from the UK across the pond - listen up because it's pretty incredible, managed to screw over our broker to turn ~£8k into £98k / $128k USD by reading the small print, true u/fuzzyblankeet style.

https://preview.redd.it/9mlup18v0q951.png?width=343&format=png&auto=webp&s=aea1393d304d16063d62d54d30cc5be9b23d937a
Unfortunately, we don't have options trading, commission free robinhood which crashes, or any other US based degeneracy, but instead we British chaps can trade "CFDs" ie. 'contracts-for-difference', which are essentially naked long / short positions with a 10-20% margin (5-10x leveraged), a 'holding cost' and you could theoretically lose more than your initial margin - sounds like true wallstreetbets autism, right? Well grab a lite beer (or whatever you lite alcoholic chaps drink over there) and strap in for this stuff:
So, CMC Markets, a UK based CFD brokerage, wanted to create a West Texas Intermediate Crude Oil 'Spot' product, despite WTI contracts trading in specific monthly expirations which can thus have severe contango effects (as all of you $USO call holders who got screwed know) - this was just a product called "Crude Oil West Texas - Cash", and was pegged to the nearest front-month, but had no expiry date, only a specific holding cost -> already a degenerate idea from their part.
So in early April, just before when the WTI May-20 expiry contract 'rolled' at **negative** $-37, the "WTI Cash" was trading at $15 at the time, but the *next* month June-20 expiry was still $30+ we (I am co-running an account with an ex-Goldman colleague of mine) simultaneously entered into a long position on the "WTI - Cash" product, and went short on the "WTI Jun-20 expiry", a pure convergence play. Sure enough, the June-20 tanked the following week, and we made over £35k, realised profits. But meanwhile the May-20 also tanked, and we were down £28k. But rather than realise this loss, we figured we could just hold it until Oil prices recover, and profit on both legs of the trade.
However, CMC Markets suddenly realised they are going to lose a lot of money with negative oil prices (Interactive Brokers lost $104m, also retards), so they screwed everyone holding the "WTI - Cash" product trading at $8 at the time, and pegged it to the December 2020 expiry trading at $30, with a 'discount factor' to catch up between the two.
https://preview.redd.it/zjjzyahx0q951.png?width=517&format=png&auto=webp&s=9523bab878f06702133631f12c1109081f299f65
Now fellow autists, read the above email and try to figure out what the pure arbitrage is. CMC markets will charge us a 0.61% **per day** holding cost (calculated as the 10x levered value of whatever original margin you put up, so in our case £8k*10x=£80k*0.61% = £500 per day, £1.5k on weekends for extra fun) on our open positions, but also "increase" the position value by 0.61% per day vs. the **previous day's** WTI - Cash value. Got it yet? No? Still retarded? Here's where maths really helps you make tendies:-> If your 'cost' is fixed at 0.61% of your original levered position, but your 'gains' are 0.61% of the previous day's position, then your gains will be ever increasing, whereas your costs are fixed.
So we added some extra £££ (as much as we could justifiably put into a degenerate 10x levered CFD account) and tried to see if it works. Long story short, it does. At this point in July we were making **over £1k per day on a £8k initial position*\* regardless where the WTI Dec-20 fwd moved.
Unfortunately, eventually CMC markets realised what utter retards they were, and closed down the arbitrage loophole, applying the holding costs to the previous day's value. But not before we turned £8k into £98k, less holding costs.
https://preview.redd.it/uh0f8knz0q951.png?width=553&format=png&auto=webp&s=c7e629f72de5aeb4e837ccef44ecae708f058bee
Long story short, puts on $CMCX they're total retards, and given what a startup robinhood / other brokerages are, never assume that only they are the ones taking your tendies away, sometimes you can turn the tables on them!

submitted by mppecapital to wallstreetbets [link] [comments]

AEF - A Misunderstood Superannuation Fund

Although AEF uniquely benefits from the structural tailwinds of both superannuation and ethical investing, we believe it remains misunderstood as an expensive traditional fund manager.

The Opportunity
Australian Ethical Funds (ASX.AEF) is a public market superannuation fund manager. The perception of the company itself vs. the industry is nicely summarised by the two figures below. Herein lies the opportunity.

https://preview.redd.it/jhvvua1t5oj51.png?width=680&format=png&auto=webp&s=e511deb4411e81840ffcf8b635e1d8f7b78eeb6e
AEF is a renowned Australian fund manager that fits within the ESG trend. It represents one of the only pure play superannuation investments in the Australian public market, with 67% of funds under management (FUM) coming from superannuation. The stock bounced exceptionally from a low of $2 in March, reaching a high of $9 in June, and has since retraced towards the low $4s. Previously, the business traded at $6+ following its announcement of end of year FUM and expected earnings figures. On 8th August IOOF Holdings (ASX.IFL) – 19.9% shareholder – announced it was divesting 15% of its stake in AEF. IOOF is a peer and platform provider which offers AEF products to its clients. The investment was sold at $5.24 vs. market price of $5.90. IOOF disclosed it was selling its AEF investment (at a gain) to raise much needed liquidity. The block trade was viewed negatively by the market, with AEF immediately re-rating to below $5.24 and trending downwards (towards low $4s) ever since. The current share price of $4.17 (24 August close) implies the stock is trading at ~51x FY20 earnings guidance, which is slightly above historical levels despite substantially improved performance and outlook. We suspect that the FY20 results will be aligned with guidance (as demonstrated historically) provided in the quarterly FUM update and guided earnings figures. Results have also been positive across its peers throughout mid to late August (see ‘Roadmap’).

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Company History
AEF began as Australian Ethical Investments (AEI) in 1986 and was owned by 600 insider shareholders before listing. It is a superannuation fund – so revenue is derived from fees on managing invested funds. By 2005, the business managed four unit trusts and a superannuation fund:
· Australian Ethical Balanced Trust (est. 1989)
· Australian Ethical Equities Trust (est. 1994)
· Australian Ethical Income Trust (est. 1997)
· Australian Ethical Large Companies Share Trust (est. 1997)
· Parent of Australian Ethical Superannuation (est. 1998)
The investments of the trust and super fund are guided by ‘The Charter’ – a series of positive and negative investment screens that must be taken into account when selecting securities for inclusion.

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In July 2005, the government enacted policy that afforded more choice to individual employees with regards to their superannuation provider (marking the beginning of a positive era for the superannuation industry). In that same year, AEF registered for a superannuation license which it was granted in 2006. Back in 2005/06 the company did not split out superannuation FUM, but FUM increased from $311m in Jun-05 to $380m in September-05 following this policy shift – suggesting there was an existing demand for ethical investment products in superannuation.
From 2005 to 2011, AEF grew total FUM from $311m to $644m, despite muted FUM growth through the GFC-era. In 2012, the business began separating out its superannuation FUM-growth to improve its visibility. This era saw FUM increasing from $617m in 2012 to $4.05bn as at 30 June 2020.
From 2016-19 reduction in FUM-based fees has seen suppressed revenue growth vs. FUM growth. This has resulted in several step changes in FUM-based revenue margins (revenue / FUM) as a result of lower overall fees earned on products. We view this shift as a positive in the long-run since AEF has competitively priced its funds, entrenching their competitive advantages (discussed below) and reducing the temptation that fee-conscious members switch funds. Since AEF has ratcheted the cost of their funds downwards (often ahead of their peers and industry averages), we believe fee compression improves the durability of AEFs revenue compared to peers who are yet to compress their margins.

https://preview.redd.it/fcq5jog26oj51.png?width=453&format=png&auto=webp&s=d194c8778727e9adf1ebc162e6b181d8207cc292
Business Model
AEF has a relatively simple business model – revenue is derived from fees on managing invested funds. The funds it manages includes retail, institutional and wholesale (non-super) funds, as well as superannuation funds. We are most interested in the superannuation business although the direct and indirect benefits associated with the funds management business are a noteworthy component to the brand and investment management infrastructure (i.e. ideation / performance fee generating / high performing ESG). Until 2012, AEF did not explicitly separate its super vs. non-super FUM. We believe this contributed to its (mis)perception as a traditional fund manager rather than a superannuation fund. Thankfully, since 2012 AEF has provided details relating to the composition of its FUM (below), and noticeably the growth in its superannuation FUM has been the driving force of the business.

https://preview.redd.it/6ccbtqm36oj51.png?width=680&format=png&auto=webp&s=6fb4e11064313ca9ab7b57186b2eddc6be62b928
Competitive Advantage
1. Superannuation Exposure: Superannuation FUM is higher growth and lower risk than traditional managed funds. Superannuation funds are regulated to grow at 9.5% due to the Superannuation Guarantee (the Australian Government mandated superannuation contribution). The regulatory framework could see this increase up to 12% in the medium-term and 14% in the long-term. For the purpose of our analysis, we have assumed a constant 9.5% contribution – so any increase would be additional upside. More importantly, excluding fulfilling conditions of release (i.e. death) an individual's superannuation cannot be withdrawn until retirement. Much like the Superannuation Guarantee, withdrawals are also mandated on a schedule that increases as a percentage of FUM with age (beginning at 4% and increasing to 14%). Consequently, the minimum inflows and withdrawals are predictable (and we note the vast majority of individuals do not deviate from these minimum levels due to inertia). Because of this mandated growth, Australia has the fourth largest pension sector in absolute terms and second largest relative to GDP (below). In 2020, the total superannuation pool is ~$2.1trn and growing. It is estimated that by 2040 superannuation assets could be as much as $9trn according to the Australian Treasury.

https://preview.redd.it/wenevil56oj51.png?width=680&format=png&auto=webp&s=c2210a8e26816af1ebf798d82c414c61760c5d5e
Alternatively, traditional managed funds are subject to redemption risk, caused (typically) by performance and myopic investor behaviour associated with general market movements. Therefore, FUM growth for traditional managed funds must be attracted through marketing and distribution channels. This inextricably links fund inflows and outflows to performance and marketing efforts, which in turn causes a clientele that is more expensive to acquire and retain, and a more volatile pool of assets. Alternatively, traditional managed funds may access capital through secondary capital raisings and the reinvestment of distributions; both of which are a country mile from a 9.5% government mandated contribution.
Logically, we wondered which (listed) asset could provide us with exposure to the exceptionally robust superannuation tailwind. We will not spend too much time detailing the industry dynamics and public market players as there is a lot of information to be found in various prospectus’ (see Raiz or OneVue prospectus). The main thing to understand is that superannuation funds can be separated into five buckets:

https://preview.redd.it/jyykix976oj51.png?width=680&format=png&auto=webp&s=07e96ebc246a565546e400ef87018d3d3360cd48
After screening for diversified financials and financials businesses on the ASX there were 53 players with at least some revenue linked to superannuation. The revenue exposure desired is revenue linked to superannuation FUM (explained further in the ‘Valuation’). However, it is important to understand that gaining access to this lucrative industry is difficult for several reasons:
· Private industry funds – the gems of the industry have been private superannuation funds such as CBUS, Hostplus, and ESTA. We cannot access them as public market investors.
· Conglomerate financials – it is possible to gain some retail superannuation exposure within the banking majors such as CBA, WBC, ANZ and NAB. However, they represent insignificant exposure by revenue and profit and the stocks are driven by other risk and growth factors.
· Fund managers – fund managers may directly manage retail superfunds or SMSF funds such as Magellan, Platinum and Perpetual. However, there is limited visibility over superannuation FUM exposure.
· Superannuation adjacency businesses – superannuation exposure can also be housed within wealth / platform advisers such as like HUB24, Netwealth and OneVue. However, to varying degrees, these businesses are not purely exposed to superannuation-FUM linked revenue.
· Pure play sub-scale – the final example can be found in Raiz, which is a sub-scale business that has ~$450m in FUM of which 85% is funds management. It is possible to envisage this business as an AEF in 10-15 years with larger superannuation FUM exposure. Although the superannuation exposure representing $70m in FUM currently (vs. AEF $2.72bn) is vastly inferior to AEF.
For this reason, AEF is the closest to a pure play (at scale) superannuation player.
Putting this together, we believe AEF is likely to continue to grow its FUM at 20% p.a. YoY. This is principally due to AEF's ability to acquire new members and retain existing members. Therefore, to monitor this continued FUM growth going forward we encourage readers to look out of the number of superannuation members added in these upcoming results and beyond. AEF has grown its member base YoY consistently in an industry which has, on average, been relatively flat in terms of member growth. In 2019 AEF was the highest growing superannuation business in Australia across the previous 5-years.

https://preview.redd.it/c4t7jx596oj51.png?width=226&format=png&auto=webp&s=51e47aa607470ce6482ed30352183a6cf6043bff
1. Ethical, Social and Governance (ESG): Beyond the obvious tailwinds in superannuation, AEF is also exposed to another important trend: ESG. Needless to say, ESG investing is becoming not only popular but almost mandatory for corporate money managers. Younger demographic investors are increasingly concerned with the ethical and social impacts of corporate activity. This report by Harvard and another by State Street provide some interesting commentary on the issue. ESG ETFs have been growing at a CAGR of >30%, and State Street forecasts that the global ESG ETF market will increase from US$170bn in 2020 to US$1.3trn in 2030. Momentum for ESG ETFs has been building specifically in Australia, where AUM surged almost 300% — from A$554.1m in 2017 to A$2.2bn in 2019.
Whilst the ESG-shift has been occurring since the 2010s, State Street argue that COVID-19 will only further catalyse this shift by highlighting the inherent inequalities in society and health care systems, in turn, spurring social conscience. We note the following data points as indicators of this more recent catalyst:
· Perpetual’s recent acquisition of Trillium, a US-based ESG fund, shows the desire of traditional asset managers to become exposed to this space.
· BlackRock has started publishing more frequently and consistently on ESG trends and continued rolling out ESG products.
· Forager’s investment blog received frequent commentary from investors talking about negative screening on their gambling holdings which has never been the case in the past.
The key insight is that a growing proportion of the investment community through time is becoming concerned with ESG issues and this will drive fund flow. Industry data is pointing to the fact that this is a prolonged structural shift rather than a short-term trend.
2. Performance: AEF has improved upon their exposure to structural industry trends in superannuation and ESG through excellent fund performance. AEF's performance (below) has been consistently strong across all of their strategies (we highly recommend reading page 4 of Sequoia's June 15, 2020 "Investor Day Transcript" to highlight how governance and performance are complimentary). Such strong performance not only disincentivises members from switching to competitors and assists member acquisition, but also significantly enhances earnings at the group level. For instance, FY20 guidance provided on 7 July 2020 vs. 22 June had a midpoint difference of ~$2m. Given the long track record of the managers it is expected performance will remain strong.

https://preview.redd.it/p6shg5nc6oj51.png?width=680&format=png&auto=webp&s=e65acb553371c6bc7c1f70ddfdf153e9e625117a

https://preview.redd.it/mtn23k7d6oj51.png?width=680&format=png&auto=webp&s=9a7ba471248070f9f05216cdf5bbcab2a1f9102b
Valuation
Key:
· FUM = funds under management
· FUA = funds under administration
· MA = managed accounts
· FU\ = total funds (FUM + FUA + MA)*
Valuing a Superannuation Member: Our valuation technique here will be somewhat unconventional. We will attempt to value the lifetime revenue per member (LRM) for AEF and for a traditional fund and then highlight the incongruity of their relative valuations.
The long-term nature of lifecycle retirement saving (and by virtue the true value of a superannuation fund) demands a long term perspective. Fortunately, the mandated nature of AEFs cash flows facilitates evaluating the lifetime value of a superannuation member. To estimate the LRM we consider the following: (i) life cycle expectations (i.e. retirement age and life expectancy); (ii) salary expectations; (iii) superannuation contribution rate; (iv) investment returns; (v) member "type;" (vi) fee structure; and (vii) a discount rate.
We begin by assuming a member makes $5,000p.a. at age 20, which grows to $130,000p.a. through the middle of their working life (35-50) and then declines to $90,000p.a. at 65 (noting these are gross values not inflation adjusted). Since the average member account balance for AEF is ~$60,000 (FUM of $4.05bn ($2.72bn of which is superannuation) / 43,000 members = $60,000 as at 30 June 2019), we can roughly assume that the average age of their member is between 30-35, which places them at the profitable end of this member acquisition cycle. Further, this member regularly contribute 9.5% of their earnings to their superannuation, which compounds at a rate of 6% p.a. Moreover, the prototypical member starts working / paying superannuation into AEF at age 20, retires at age 65, and redeems according to the minimum withdrawal schedule until age 85. However, how many members live according to this prescribed lifecycle; supported by an uninterrupted working life? What about people that take time off to raise children, either returning to part-time work or full-time work? We can model these archetypes also, which assumes much lower income growth and some years of earning no income. If we assume that society is roughly split into thirds by these archetypes (i.e. 1/3 uninterrupted, 1/3 interrupted and return part time, 1/3 interrupted and return full time), then we can calculate a weighted average LRM for the average member. Compressing fees by more than half to 50bps and assuming a 7% discount rate we arrive a weighted average discounted LRM of ~$18,000.
Whilst comparing this to the average member in another non-super fund is difficult for an array of reasons (i.e. average acquisition age, average income, average balance, average contribution, redemption allowance etc.), we can loosely estimate what this looks. Adopting the same framework as above, to estimate the LRM of an average managed fund member we must first define the managed fund member "archetype." First, we assume the average traditional fund member has a higher income profile (as lower income earners typically do not invest in managed funds). We tweak the income profile to peak at $180,000 between 35-50 and taper down to $120,000 by age 65. Second, we assume the acquisition age is 30 years rather than 20 to reflect that most individuals do not invest in traditional managed funds until later in life. Thirdly, we account for the non-compulsory nature of managed fund contributions. If we start with the marginal savings rate (10-year average of ~7%) as a proxy for available funds for investment and increase this to align with our ‘managed funds’ archetype who has higher income to 15%. We then assume that from this 15%, about 1/3 will be invested into a managed fun (or ~5%). Therefore, for our individual earning $180,000 during peak working years, this is an annual contribution of $7,200. Finally, we increase the discount rate to 9% since because redemptions are more likely in a traditional fund. Using these alternative assumptions, we arrive at a LRM of ~$5,000.
The significant difference in LRM helps explain why a superannuation business can command a much higher multiple of FUM or earnings. Further, we believe our estimate of LRM for a traditional fund manager is quite bullish (i.e. overstated) due to the following: (i) it assumes the individual works full-time for their entire life; and (ii) it assumes the individual stays with the fund from age 30 to 65 and makes uninterrupted and stable contributions. Although dollar cost averaging is touted as an eighth wonder of the world, we are doubtful it is applied as often as it is spoken.
Trading Multiples Valuation: Valuing AEF on a relative basis is difficult given the lack of peers. Against traditional fund managers (i.e. Magellan, Perpetual and Platinum), which trade between 5-20x earnings, and superannuation exposed platforms (i.e. Netwealth and Hub24), which trade between 25-40x earnings, AEF looks relatively expensive. We are acutely aware that AEF is currently (at ~$4.2) trading at 12.6% of FUM and ~51x earnings; and at its peak (~$9) was trading at 25% of FUM and 120x earnings. We believe the valuation difference is driven by the quality of the FUM managed and, therefore, the quality of the earnings growth.
Given their high alignment to superannuation, NWL and HUB are the two most comparable firms to AEF. As the trailing figures show, AEF appears to be trading on par with its peers. However, an important nuance is the trailing figure for AEF is based on 2019 earnings, whilst for NWL and HUB it is based on FY20 earnings given they have already reported. As such, on a like-for-like basis AEF’s ‘trailing’ earnings multiple (based on the mid-point of management’s guidance) is actually ~51x. This means it is trading below NWL and HUB, despite the fact that the majority of those businesses’ FU* is linked to FUA rather than FUM, which has a lower monetisation rate. Not to mention, the split between superannuation and managed funds is not as clearly delineated as is the case with AEF. What is also evident is limited analyst coverage of AEF and lack of forecast guidance assisting the market to predict growth (as is the case with NWL and HUB).
Relative to traditional fund managers (i.e. PPT, PTM and MFG), we note the substantial difference in FUM and business quality. AEF hosts the highest monetization rate (Rev/FUM), even whilst facing fee compression, with the highest FUM growth among its investment management peers. Furthermore, we expect EBIT margins will improve from ~30% toward its larger traditional fund managers peers due to economies of scale over time that we believe will more than offset any fee compression. AEF has also supported a very high ROE due to its sticky clientele and service-based business model. The combination of: (i) best in class monetization; (ii) high LTM and increasing membership base; (iii) improving margins; and (iv) high ROE will make for an incredible growth engine on earnings in the long term. Thus, AEF is a higher quality business with ~4x+ the LCM of a traditional fund trading at only a 2-3x premium using current ratios...

https://preview.redd.it/nffeuvef6oj51.png?width=680&format=png&auto=webp&s=e0aed3fcb4464355aa965ed151d6dc2e484ff4b8
Risks
We note the following investment risks with AEF:

Fee Compression – The funds management industry is subject to fee compression across both funds and superannuation funds. There has already been a lot of restructuring of AEF’s fees since 2016. The investment product(s) they advocate is also one that serves an ethical / moral dimension and can arguably be charged at a premium above market. Notwithstanding fee compression beyond that which we have considered would place downward pressure on margins.
Member Attrition – The stickiness of AEF's membership base is a hallmark of their competitive advantage although this could be reversed over time due to poor performance or corporate mismanagement. We encourage the reader to keep an eye on member growth and net inflows over time.
Product Reproduction – There is no official IP upon ESG investing and new products are increasingly being promoted to capture market share of this growing market. We believe AEF's early mover and strong brand serve to mitigate this risk.
Regulatory Risks – Changes in the superannuation regulatory environment can be material. This has long been debated within the public domain although it has been viewed as politically unfavourable to change the superannuation system without a reasonably long lead time and grandfathering provisions, which we hope would make any changes unlikely and less meaningful.

Investment Roadmap
Peers’ Earnings Updates: In summary, the FY20 results of peers indicate that businesses with revenues dependent on investment funds have performed quite strongly during this period.

https://preview.redd.it/np04rasg6oj51.png?width=680&format=png&auto=webp&s=0de02bee60036e9bd71068815e618c2f3711db24
Earnings Announcement: Earnings release on 26 August 2020 should provide for the first catalyst to remind the market of the AEF's fundamental performance. The key figures here will be superannuation FUM, superannuation members and FY20 earnings. AEF will also provide ongoing quarterly FUM announcements, with the following update due in early October. We may also see a mid-August FUM figure in the most recent announcement. Finally, AEF has historically provided updated FUM in back-dated results announcements. Evidence of this occurring can also be found in HUB's most recent announcement:

https://preview.redd.it/jz8frxfi6oj51.png?width=680&format=png&auto=webp&s=325d7973e1eb6c98e714dea69306b1ebf8ab0cc7
Private Market Activity: Whilst we think that a private equity buyout is unlikely for AEF, further media exposure and transaction data points should help the public value these assets. There have been some recently executed and rumoured deal activity in the space through 2020. Notably, KKR – one of the largest US-based global private equity funds – bought a 55% stake in Colonial First State valued at ~$3bn from CBA. The implied valuation was ~16x EBITDA, despite the quality of business model and LTM of members being substantially weaker than AEF. There is similar PE interest in NAB’s MLC Wealth, with US funds CC Capital and FC Flowers on second round bids for the asset. NAB's MLC Wealth business caught the attention of Carlyle, BlackRock, and KKR earlier in the year although deals were not executed. The interest from KKR in Colonial is particularly notable, given Scott Bookmyer (KKR partner) who refers to Australian superannuation as the ‘the envy of the western world’. We believe AEF may benefit indirectly from private equity interest, which will confirm both the long-term value and viability of their business model.

submitted by Bruticus91 to ASX_Bets [link] [comments]

SWK - Insanely Cheap Mining Adjacency

*** Updated Research

SWK provides an amazing opportunity to take advantage of the bull market in precious metals at an undemanding valuation with excellent operational momentum.
Environment:
Precious metals have had a phenomenal ride lately; both due to fear arising from COVID-19, and coordinated monetary policy stimulating economies at an unprecedented level. The graphic below shows the recent parabolic move in GLD (overshadowed by SLV) and reflecting upon the 08 crisis and the numerous QE policies that followed, this upward trajectory may continue further.

GLD vs DJIA (2006-Present)

With rises in commodity prices, the logical next step is to get some operating leverage and purchase the gold miners. No doubt, this second level thinking has been handsomely rewarded albeit encountering the sovereign and FX risks with many of the global miners domiciled in South Africa and Russia:

DRDGold, Polyus and Polymetal (April 20 - Present)
Since many of these miners are in the process of expanding production, cash flow won't be realised for several years and operating margins may not improve as much as managements' forecast (i.e. ASX: DAC). Further, since the market has drawn the logical connection between commodity prices and miners, these companies have run a very long way in the last few months.

Company Overview:
This is where SWK provides us with a cheaper and lower risk opportunity to gain access to this thematic. SWK provides drilling services to large miners of metals (i.e. nickel, silver, gold etc.) in US, Canada, Europe and Australia. Specifically, they use specialised drills to extract samples, which they analyse to then assess to the viability of a site. Increasing demand for mining exploration will, intuitively, increase drilling utilisation and drilling rates. SWK also entirely owns Orexplore, which provides mobile sample analysis to determine the characteristics of extracted cores. This improves the efficiency of examining the quality of a site by removing cost (transportation and storage), timing (it can be conducted on-site), and operational risk (damage in transit) all of which further benefit the mining co. and embed SWK into the exploration process.

Competitive Advantage:
SWK’s competitive advantage is being able to a world class cost effective and efficient underground drilling. For example, their development of DeepEX allows for longer hole from underground that are cheaper than many shorter surface holes. Their recent contract extension from BHP at Olympic Dam despite competitors (i.e. MSV and BLY) rigs being used onsite is testament to their value proposition.
SWK has also invested heavily (~$25mn) into their Orexplore technology in an attempt to move up the value chain away from high-capital intensive drilling into a higher margin business. This technology removes significant operating expenses (employees and equipment), reduces lead time (can be built and shipped globally within 2 weeks), is very simple to use (technical training is not required), and most importantly, is currently being purchased for free and is the main catalyst in this investment (more on this later).
Furthermore, SWK has made a concerted effort to increasingly diversify their product offering to different miners (with exposure to various commodities), and geographically. Their global and diversified footprint has provided them with a world-wide footprint, with costs to build their global business already incurred (most recently in Pogo – Alaska), further encouraging a buyout (more on this later).
FY19 Financial Report
H1 2020 Financial Report

Catalyst and Valuation:
Exit Options:
The primary catalyst for a revaluation in SWK is a huge macroeconomic tailwind providing momentum that might facilitate a sale of the drilling business to a strategic buyer. Without doing too much crystal ball gazing, I view the exit opportunities as follows:
5% - Amazing sale of drilling business = >100%+ returns;
65% - Solid sale of drilling business = 50-100% returns;
20% - No sale and general re-rate = 25-50% returns;
10% - Languishing business and capital destruction = -25%-0% returns.
Given management’s firm guidance towards the sale (https://www.openbriefing.com/OB/Swick-Mining-Services-Ltd/2020/2/25/Swick-HY20-Results-Conference-Call/3716.aspx at ~08:00) I will focus on our base case that entails: (i) selling or closing surface drilling business as it’s the lowest margin / weakest vertical; (ii) selling underground drilling business; and (iii) refocus towards Orexplore either through taking the business private, IPOing a new entity or rebranding SWK.
Given shareholders have been frustrated with SWKs delay in progressing the business towards a sale and having difficulty commercialising Orexplore it has been important to wait for a noticeable inflexion point in the business to attempt to “time” entry as much as possible. Let’s see how the inflexion point is here beyond the macroeconomic environment above.
Miners around the world are aggressively looking to expand their operations due to increasing commodity prices and SWK's services become front of mind. Recent news is ticking all the boxes and adding huge momentum in the stock to catalyse a re-rating.

Reinstatement of dividend payment and share buyback program showing prudential capital management and a positive outlook relating to future financial position. This is a double-edged sword as management raised capital at 23c and bought back shares from 12.5c through to 17.5. By buying now, we have avoided this dilution although acknowledge this was not the best form of capital management. On the other hand, it does suggest management are flush with cash and happy to redistribute to existing shareholders before a possible sale; that is, we get paid to wait:

ASX Announcement 1
ASX Announcement 1

ASX Announcement 2

Contracts are being extended, new contracts being won, and guidance on FY21 figures. Management are highlighting clear intention to demerge and growth is providing EBITDA growth for a better sale price:

https://preview.redd.it/06fxmos33dh51.png?width=563&format=png&auto=webp&s=70367dc6c623a4bb16c434f7f0f9892cd2a2f20b

Large contracts with key miners and commercialisation of Orexplore. This is increasing utilisation rates and improving margins by expanding work at existing sites:

ASX Announcement 3a

ASX Announcement 3b

Upcoming earnings call to catalyse re-rating:

ASX Announcement 4

The Orexplore website (https://orexplore.com/the-orexplore-review/) has received increased attention with far more activity within their “Review Blog” section leading towards commercialisation. Posts are being made almost weekly increasing its awareness:

https://preview.redd.it/snsbk0vz2dh51.png?width=602&format=png&auto=webp&s=bb5a68c362a20c900c127dd53357ac5bf46dbbd5
https://preview.redd.it/1a80klgz2dh51.png?width=602&format=png&auto=webp&s=ab1f81609e06fc30683de45a4de778bb2838bb80

MSV as the strategic buyer for the drilling business has shown intent to inorganically expand their operations. Deepcore had an EV of ~$44m (excl. additional earnout payments), revenues of ~$50m p.a., and an EBITDA of ~$12m with approximately half the rig number of SWK. This purchase confirms the “fair value” multiple for a drilling business is ~4x EV/EBITDA, even for a significantly weaker private business due to utilisation, profitability, scale and contractual certainty.

https://preview.redd.it/jumpn58y2dh51.png?width=602&format=png&auto=webp&s=ad650e7b63b341e06ddd0a8bff88121249a03925
Valuation:
Ok, so let’s turn our attention to the forward guidance and conservative estimates for SWK. SWK against mostly all metrics is very cheap. Management have forecast EBITDA to be ~$25mn in FY20. Although I think we can conservatively estimate this to grow significantly throughout FY21.
The improvements to EBITDA will come from the following: (i) commercialisation of Orexplore = $0.5-1mn, (ii) ~$3-4mn in reaching steady state (20%) margin from the Pogo contract as costs normalise and backdated earnings flow through; (iii) ~$2mn in operating expense reduction during COVID-19; (iv) the $120m increase in the order book between 30 July and 14 August implies $120/5 = $24m p.a. at a slight discount to target margin of ~15% gives another $3.5mn EBITDA. Putting this all together FY21 EBITDA might be ~$35mn.
In addition to the purchase of Deepcore, we can use the current valuation ratios of MSV and CAPD as a guide. Currently competitors trade between 3.5x (CAPD) and 4.5x (MSV) EV/EBITDA multiples. If we use 4x as a reasonable multiple on current EBITDA, this would imply an enterprise value of ~$100mn (or a 30% upside) whilst paying nothing for Orexplore. Upon conservative forward FY21 EBITDA figures, the enterprise value could easily reach ~$150 (or a 100% upside) again paying almost nothing (only $1mn / $35mn in EBITDA) for Orexplore.
By way of reference, SWK with similar metrics in 2011/12 was trading at a ~100% premium (i.e. ~40c (market cap $90-110mn) whereas now it is ~$20 (market cap $50mn). A decade ago, it also did not have the same existing clientele and large-scale contract wins (see 3a above with a forward order book of $363mn (relative to current revenues of ~$150mn).
The cherry on top of this investment is Orexplore, which we buy for free. None of the revenue and earnings multiples above include any real impact from Orexplore. On 14th August the commercial viability of Orexplore was been partially validated with their first contract win. Although its value is only $700,000 over 6 months this call option like payoff comes entirely for free. Further, the true profit margins of SWK has been hidden due to the losses incurred from Orexplore, which has to date cost $25mn in R&D (or equal to almost 10yrs of earnings), the amortisation of associated software development, and continued global expansion (Portugal and Europe before North America) each requiring initial costs prior to achieving target margins. Even better we get a first glimpse at how attractive Orexplore might be. Combining discussion in the latest conference call (https://www.openbriefing.com/OB/Swick-Mining-Services-Ltd/2020/2/25/Swick-HY20-Results-Conference-Call/3716.aspx 04:30 - 06:30) with the recent contract we can conclude the following: (i) 3 machines at Sandfire will generate ~$3.6mn in revenue covering approx. 50% of cash flow with nearly no operating expenses; (ii) $700,000 for 6months scanning 1500m of core per month implies ~$75/m (against an estimated $100m from guidance). As per guidance, if we assume Orexplore machines can scan ~$4m/hr ($300hr) and total costs may include one unskilled technician and minimal overheads ~$50mn this provides a gross margin of ~75% (or almost 4x undergrounding drilling). Due to the profitability of Orexplore, 15-20 operational machines on yearly contracts would provide greater earnings than SWK’s entire business. Hopefully the publicity of Orexplore at Sandfire can attract some attention, and in turn some additional contracts.

Risks:
No investment is without its risks, and for SWK they fall into: (i) capital mismanagement; and (ii) poor communication / delays. Firstly, the recent capital raise at ~23c followed by aggressive buybacks at ~12.5-14c-17c seems unwise. Although buying now avoids this dilution, it is unclear why excess capital was required if dividends and buybacks were announced shortly thereafter. Secondly, the share price has historically languished due to a lack of publicity and detail on the transformational Orexplore. It is likely that management were unwilling to oversell the Orexplore narrative before genuine contracts were won and the technology was established. Now that these are in place, hopefully the corporate restructure can take place and the upcoming strategic review can provide a clearer picture for the near term.

submitted by Bruticus91 to ASX_Bets [link] [comments]

M1 Plus Review

Intro:
Bought into M1 Plus from a $60/yr Promotion 2 months ago. I had an investment account already, and even one of the first spend accounts. I had declined the offer for M1 Plus at $125/yr.
This is a first review of M1 Plus after two months of use and a bit of a dive into the value of its features from a financial and user experience point of view.
Value:
This is a pretty simple one. Do the math. The interest vs. your other checking account multiplied by the amount of cash you’d be keeping in there for M1 Spend. If you’re borrowing from M1 too, the 1.5% difference (or whatever difference there is between M1 Borrow and your next best offer) multiplied by the amount of money you’d like to borrow. If all these add up to greater than whatever annual fee is offered, go for it.
Otherwise, it’d be a very expensive metal card. But if 4 waived ATM fees go a long way to save you money, that should be worth considering too, however, there are tons of cards and products that’ll waive said fees, some even for unlimited transactions and no upfront cost. Just because M1 is offering this benefit as part of a premium package doesn’t mean it’s impossible to find for free somewhere else.
XP:
It is a great experience. I constantly invest lumps of $500 into my portfolio all the time. It’s quick, easy, and immediately fulfilling. Not that other brokerages don’t do this. But M1 is clearly focused on showing you your long term progress on your investment goals. It uses a money weighted return formula so that you know how much your capital has been making you to easily compare to the return of bank accounts and investments. There’s a reason their product is called “Invest” and not “Trade”, more on that later. But this means it’s primarily suited for this purpose. During the Covid crash, I took to Robinhood to place my Put Options on the S&P because high frequency derivatives trading and M1 basically speak different languages. All this to say, it feels amazing to watch your investments accounts slowly creep up as you continue to dollar cost average into the market, but this has some drawbacks.
Pies. While fun and easy to build, mix and match, they are not a very common mechanic to implement on amateur portfolios. Selling stocks can be quite the process on M1, and the platform will try its darnest to discourage you from making any but the most basic adjustments to your portfolio. Its really only suited for the “set it and forget it” mindset, which is not to say you can’t mess around with your money as you please, but it’s just so perfect for investing and watching your money grow with a long time horizon. The plots will show you your progress and encourage you to keep a regular deposit schedule. But try trading into and out of a stock, or a set amount of shares, or even thinking about playing with derivatives and other financial instruments: slim pickings.
The numbers make a lot of sense, too. I’ve been investing for about 5 years now, and my latest craze has been leverage. I’ve read about how the optimal leverage ratio for the S&P on average was 2.0 or 100% levered up, and looked up the historical comparisons to corroborate. Shopping around for margin accounts and available capital, it’s tough to beat the 2% rates at the moment. I’ve been slowly levering up during the latest market rally to great effect and the low interest really pumps up those numbers. Having this much cheap capital, not just for leverage, but also for life is worth more than just the time value of money. I would make the point that this is made even more valuable by having all your financial services on the same platform, as you really get to do with your money as you please and move it around to withdraw it to your hearts content.
My real issue was with Spend. Not a problem with the product but myself, in trying to justify the annual fee. I weighed how much money it would make sense to keep in Spend as opposed to an online savings account. To keep cash a couple of months ago, it made more sense to opt for ally or marcus as they were offering close to 1.55% on cash. But as their rates have plummeted, getting 1.0% on a CHECKING account has been an absolute godsend in this crazy economy. This account works for just about anything with the notable exception of checks... in a checking account which I suspect is the reason for the “Spend” branding the product was marketed with. When it’s hard to even find 1% on a savings account, a 1% APY on checking is no-worries approach to cash investment.
Ultimately, having all of these balances displayed together on the Transfers tab is huge in terms of consumer experience. This, however, should not be a replacement for true “Dashboard” that could show an overview of all your money moves and account balances.
Ideas:
M1 Trade. Admittedly, I do see how this can be very contrary to the philosophy, product and experience that M1 has worked to create. That being said, thinking that your customer will always prefer to have their money invested into automatically allocated pies is a little short-sighted.
Opening a much more DIY Trading product on M1 would of course have them incur tons of costs in handling and verifying transactions of all the individual financial, but many places already offer such services for free, some are even profitable at it. An M1 Trade product would also need integrating the Invest product because regardless of what you’re doing on the platform, you still consider your money your investments and want to see it all together. Pies and individual Buys would have to play nice together, and that does sound like a difficult endeavor.
I keep a couple of accounts with different mixtures of my pies for all my purposes. I also handle the investments for a few of my family members, which will become relevant shortly. You can obviously set up as many accounts as you wish and move money into them as you desire, but this can get you into some warmer water. If two of your pies hold most the same securities and you just want to have a different pie for a different account, you’ll have to call up to pause trading so that your pies have a chance to get to know each other and not force you to sell and buy right back into the same assets just to incur the taxes. It’s a bit of a hassle, and I would argue, on purpose.
For Pies themselves, I often find myself wanting to make small tweaks to pies but then quickly let it go as removing slices would automatically trigger a massive sell off that incurs taxes. From a conversation with tech support, I gathered that the best way to do this was simply pause trading on your account, and change the pie you want all your money to go into. Editing pies is fine and easy, but completely swapping a pie for another one led me to believe that it would sell put of all my holdings even if the old and new pie had many of those same holdings. If this is me being stupid, good, if it’s a gap in features, I hope M1 lets you simply swap a pie for any other and gives you the option either sell everything, sell only what is 0 in the second pie, or sell nothing and simply continue aiming for the allocation of the new pie without touching your previous investments.
Lastly, an iPad app. I’m a big fan of the iPad and the iPad Pro in particular. I’ve found myself using it far more than my laptop which is now strictly reserved for long work sessions (I write and edit for a YouTube Channel) and watching content in groups of people (15” MBP Speakers are the stuff of legend). But for anything else, I subconsciously grab the iPad. It’s annoying to have the website be the best M1 experience on the iPad. I understand that making a compelling iPad investing app is its own mountain to climb, but a lot of the Mobile app’s functionality can be ported over without too much of a hassle. Charles Schwab has an iPad app based 99% on the iPhone app that still performs all the same functions, just on the bigger screen, which is the whole point of the iPad in the first place. While it’s not a top shelf iPad app (there are only a select few) the Schwab app is lovely and I’m begging M1 for anything that doesn’t force me to use my iPad in portrait mode to use a blown up iPhone app. Again, this app doesn’t have to be a world beater, just a decent looking and bigger version of the iPhone app that would go a long way to boost the M1 customer experience.
Closing Remarks:
Obligatory YMMV disclosure: it’s about the math, I won’t bore you with my own, but I was just over the line when it made sense for me to opt into the $60/yr promo.
That being said, M1’s value has been a lot about the experience. The future of finance is free. No brokerage should be making money on transaction commissions or administrative fees, it’s a relic from the before times when you needed people who knew people on wall street to do your trading. At this point its not even worth any perceived convenience.
The clever ones reading this will point out that, while true, many brokerages already offer a wide variety of free services. Many of them, even, that M1 doesn’t offer.
The true spirit of this review is to express my personal opinion on the value of M1 Plus and how the customer experience is its edge in the ebrokerage market. Rates are competitive, but it is a brand new way to consider finance and its role in your life and society.
TL;DR
Spend is pretty competitive for a checking account, and as long as you’re not using checks too often, its a no brainer for anyone with close to $10,000 in cash just sitting somewhere.
Invest is beautiful, but the free version is exactly as good, more windows means very little with the limited trading you’re allowed to do anyway.
Borrow is brilliant, hella flexible and competitive rates.
8/10 Would recommend to a friend.

submitted by TomasFCampos to M1Finance [link] [comments]

Top options trading mistakes that you should not make

This is my post on wsbelite. Repost here for all.
IMO, trading options have similarities to playing poker and in order to be successful in the long run you need to be disciplined and refrain from making common mistakes. I’m going to list common mistakes and some tips here. Please suggest more. Hope we all lose less tendies!

Refrain to trade low volume options . These contracts will have really wild bid/ask spread, or really low volume, which reduces your chance to make profit significantly. For example how can you win if you trade $ROPE 100c when the bid ask spread is $69/$96 per contract?
Refrain to trade very low price options (e.g 1-10 cents) because your broker commissions will eat up a significant amount of the transactions. Think how much commissions you have to pay to buy 10000 contracts of 0.01 $ROPE 1000c which costs $10000 of premium.
Refrain to buy near-dated far OTM options, because this is almost a sure way to burn your money. Even worse, even if you guess the direction right, you may still have a substantial loss. Think $PEI 500% OTM 2DTE. Btw $PEI is a great stock to own. Example: on 04/13 you bought SPY 496c 04/17 when SPY=280. On 04/14 SPY rises to 285. Guess how much you made on your call options?
Know when to select OTM vs ITM options: in general: OTM is higher risk/higher return. Have some sense of OTM price movement - even when you guess the direction right, far OTM options won’t make you money because of low delta. ITM is more expensive. ATM is typically a safe choice if you just want to make a directional bet.
Know theta-crush. Your options will lose time-value every day, so refrain from buying short-dated options unless you know what you're doing.
Know the effects of IV (VIX for SPY) on options price. Sometimes even when you guess the direction rights, you may lose money because of VIX movements. Know how to hedge for VIX movement.
Refrain from using market orders when possible: limit orders will give you the price you want.
Understand the margin impact of different options strategies.
Understand the impact of your broker commissions.
Bank management: never YOLO your entire portfolio into one position, because if you lose, there’s 0% chance to make it back. Learn http://www.thepokerbank.com/strategy/basic/bankroll-management/. If you want to get in a large (50K+) position, average in/out may be a good idea.
Don't open too many positions unless you're a bot. It's hard to manage manually and easy to make mistakes.
(Mostly) don't follow autist DDs that you can't explain.
Learn the market hours!
Options strategies can be complex to visualized. Use your broker's performance profile tool to understand the performance implications before making a trade.

Some risky options strategies that you should only do when you know what you’re doing

Naked puts, i.e. short puts: very risky especially in a recession: when the underlying crashes you’ll lose lots of money
Synthetic shorts: i.e. long puts + sell calls, also very risky, only know when you’re 90% sure of the direction.
Naked calls, i.e. short calls: also pretty risky if the underlying moons.
…

Less risky options strategies:

Covered calls: very low risk. You hold shares, and sell OTM calls to cover them and collect the premium.
Cash secured puts: sell puts but you have cash to cover it. This is good when you’re willing to buy the shares if it drops, otherwise you collect the premium.
Diagonal: Simultaneously entering into a long and short position in two options of the same type (two call options or two put options) but with different strike prices and different expiration dates. Typically these structures are on a 1 x 1 ratio. This is less risky and can hedge you against IV as well. For example if you bearish on USO, buy a 4p 05/15 and sell a 3.5p 04/24, that way if USO moves upward on the week ending 04/24 you’ll collect the near-dated premium.
Learn how to sell options. Every mistake you made as an option buyer is probably a chance for you to profit as an option-seller.

Practical tips

Use tools to scan top volume options. https://www.barchart.com/options/volume-leaders . This can give you some confirmation.
Use tools to scan unusual activity options. https://www.barchart.com/options/unusual-activity Try to think why people are making that trade. Your broker also has tools to scan these.
Take advantage of L2 flow data if your broker provides.
Sometime when you can't make a long-term directional bet, it may be profitable to day-trade or swing-trade (hold your positions for 1-3 days).
Know common ETFs:

SPY: everyone knows this. The most liquid options to trade.
IWM: tracks Russell 2000. Also pretty liquid. Trade this if you don't want expose to big techs.
Sector specific ETFs: XLE, XLF, XLC, etc. Also highly liquid.
Country specific ETFs: EWU, EWG, EWC, EWA, EWJ ... fairly liquid.
Gold: GLD
Silver: SLV
Oil: USO (make sure you really understand this; it doesn't track oil price)
Options of individual stocks: in general, the more liquid the underlying, the more liquid the options, e.g. AMZN, BA, FB, TSLA, ...

Tips to improve
Learn more about economics and business to improve your common sense.
Advanced topics: understand how MM works, gamma hedging, dark pool indicators, probably understand some TAs such as RSI.
Day trade dynamics: power hours.
Things to debate

Should you use stop-loss orders or not?
When to buy FDs and how much should you spend on FDs?
What is the impact of the underlying delisted on put options? As example OILU closed on 03/29 https://materials.proxyvote.com/Approved/MC3724/20200316/SUP_421079.PDF

On March 15, 2020 ProShares Capital Management LLC announced that it plans to close and liquidate ProShares UltraPro 3x Crude Oil ETF (ticker symbol: OILU) and ProShares UltraPro 3x Short Crude Oil ETF (ticker symbol: OILD). Each fund trades on NYSE Arca. The last day the funds will accept creation orders is March 27, 2020. Trading in each Fund will be suspended prior to market open on March 30, 2020. Proceeds of the liquidation are currently scheduled to be sent to shareholders on or about April 3, 2020 (the “Distribution Date”).
Shareholders may sell their shares of a Fund (subject to any applicable brokerage or transaction costs) until the market close on March 27, 2020. From March 30, 2020 through the Distribution Date, shares of the Funds will not be traded on NYSE Arca and there will not be a secondary market for the shares. During this period, each Fund will be in the process of liquidating its portfolio and will not be managed in accordance with its investment objective.
These strategies are intended to allow an Oil Fund to preserve a minimal portion of its value in the event of significant adverse movements in a Fund’s benchmark. There can be no guarantee that an Oil Fund will be able to implement such strategies or that such strategies will be successful. Each Oil Fund will incur additional, potentially substantial, costs as a result of such strategies which may cause or increase tracking error and would be expected to have a substantial adverse impact on performance. Use of such strategies would cause an Oil Fund to not perform consistent with its investment objective. Furthermore, in the event that an Oil Fund’s value decreases by 70% or more at any point from its prior day’s NAV, as determined by the Sponsor, the Sponsor, in its sole discretion, in order to maintain the integrity of the ongoing operation of the Fund or for other reasons, may cause such Fund to liquidate some or all of its positions and, in lieu of such positions, invest such assets in cash or money market instruments. The above actions may be taken without prior notification to shareholders and would be expected to cause an Oil Fund not to perform consistent with its investment objective. Under these circumstances, consistent with its general authority, the Sponsor may, but is not obligated to, cause an Oil Fund to be terminated and dissolved.

submitted by tinkerprophet to wallstreetbets [link] [comments]

I bought six PRPL mattresses today. You should buy PRPL too (it's undervalued).

tl;dr: Buy PRPL stock, warrants (PRPLW) or calls based upon your preference. They are closing out a killer quarter and are undervalued. PRPL 22.5c 8/21 if you really need a strike.

I decided to appeal to both WSB audiences today with two different types of DD:

A completely irrelevant story with some pictures and a position
Numbers and Other Stuff

I bought six Purple Mattresses today.

Yep. I moved to Utah a few weeks ago (absolutely true) in order to do better DD for you in Purple's hometown (not true at all), so I decided to trek down to the Purple Factory Outlet to scope out the scene.
Purple Factory Outlet in a crappy part of Salt Lake - Sign on the door says \"NO CASH INSIDE\"
Family informed me they were coming to visit in three days (who does that to someone when they just moved!?!). My wife said we needed sleeping arrangements, so I said Purple mattresses.
After speaking with my Mattress Firm friend, he told me that Mattress Firm is entirely out of stock of twin mattresses in the Salt Lake City market (Purple's hometown). Worse, the mattresses aren't coming back as the original (the only mattress to come in twin) is being discontinued.

https://preview.redd.it/qd4u5bo3oy751.png?width=1242&format=png&auto=webp&s=3417ffb0eca481dbd797b67be2cb9c06c7a58a65
This is a screenshot of an internal Mattress Firm memo on the discontinuance of the Original Purple Mattress (the cheapest one by far) What can I say? He isn't a photographer.

The original is going away
Floor models are NOT to be sold as they are traffic drivers

https://preview.redd.it/tsevapzpoy751.jpg?width=3024&format=pjpg&auto=webp&s=04399eff4e38e98ad17fa55d6db0e511f799bc67
I figured the Purple branded store would have stock, if it existed. And because they are being discontinued, I didn't want to be left short-handed in the future. So, I walked out of the store with six Purple mattresses. And some pillows. And sheets. And mattress protectors. Aaaaaand because I took delivery, it counts towards Q2 revenue (the best part).
For all of those who will inevitably accuse me of pumping the stock, I admit that purchasing six mattresses will pump revenue and therefore pump the stock after earnings. Now, where are all of those people who asked me for a free mattress?

This was a sign.
Most importantly, when I pulled out of the parking lot, a purple Dodge Challenger zoomed right by me. I was barely able to get this zoomed in picture of it. This means PRPL stock is going to zoom up.
PRPL 22.5c 8/21. I bought ten of those contracts today too. It was cheaper than the mattresses.

Numbers and Other Stuff

I put forward that because Purple is a high revenue growth company, the best valuation metrics are revenue multiples (as opposed to EBITDA multiples or P/E ratios). You're welcome to debate this, but frankly, the forward looking EBITDA and Earnings look beautiful as well.
Additionally, I put forward that Enterprise Value / Revenue is superior to Market Cap / Revenue, but I'll let you do that research yourself.
From Yahoo Finance:
Enterprice Value / Revenue

Ticker	As of 6/28/20	2020 Q1	2019 Q4	2019 Q3	2019 Q2	2019 Q1
PRPL	2.01	2.52	3.94	3.61	3.73	3.09
TPX	1.71	4.84	7.39	7.34	8.07	6.88
SNBR	0.98	2.36	4.40	3.79	4.97	3.78
CSPR	0.53	0.91

Yes, COVID has happened, but unlike TPX, SNBR or Serta Simmons Bedding (which just completed a pseudo-bankruptcy), Purple has actually benefited from COVID and its prospects have never looked better with a shift to higher revenue- and margin-per-unit DTC as well as insatiable demand from its wholesale partners.
PRPL is currently trading well below its own previous EV / Rev multiple range, despite accelerating revenue growth into Q2 with a healthy long-term outlook of holding an increase.
Additionally, PRPL is trading well below the pre-COVID norm for industry EV / Rev mutliples.
What about CSPR? CSPR is a total dumpster fire that is now drowning in IPO lawsuits. Its revenue growth has materially slowed, was awful in April forward looking (15% YoY growth vs 170% for PRPL), on declining margins. The cash burn rate for CSPR was high before COVID. They likely only have a few quarters left to live. I think they are overpriced as a result. CSPR is a bad comp even though there are similarities to the businesses at the 30,000 ft level.

Revenue Growth & Estimates (Q2 Estimates via Yahoo Finance)

Ticker	My Estimate	Q2 Low-Mid-High Estimates		2020 Q1	2019 Q4	2019 Q3	2019 Q2	2019 Q1
PRPL	201.7-233.3	170-180.1-186.9	Actuals	122.4	124.3	117.4	103.0	83.6
			YoY %	46.3%	58.3%	65.8%	36.0%	37.7%
TPX		613-616.4-626.4	Actuals	822.4	871.3	821.0	722.8	690.9
			YoY %	19.0%	32.9%	12.5%	7.9%	6.6%
SNBR		176.8-216.4-281.4	Actuals	472.6	441.2	474.8	356.0	426.4
			YoY %	10.8%	7.1%	14.5%	12.6%	9.7%
CSPR		95.8-104.8-113.6	Actuals	113.0	126.9			89.4
			YoY %	26.4%	24.3%*	24.3%*	24.3%*

A few items of note here:

CSPR disclosed the Last Twelve Months YoY growth as of 3/31 was 24.3% (which sucks for a revenue growth company that is burning cash)
PRPL accelerated its growth over the past year. It is massively accelerating again in Q2.
PRPL disclosed in an 8k that is has already booked about $145M in revenue for Q2, so the analysts' consensus estimates are WAY under. I gave my math and estimate for Q2 sales here. I still stand by the estimate that PRPL will beat $200M in revenue this quarter, especially since I just bought six mattresses.
Now compare the barely double digit growth numbers of TPX & SNBR over the past year to PRPL. Now compare the EV / R multiples. Something is off.
PRPL may very well beat SNBR in revenue for Q2 (due to SNBR's high reliance on wholesale sales).

Summary: PRPL's EV / R multiple is under where is should be, even in this market, whether you compare it to its own previous multiples or its competitors before they were affected by COVID. If you look at COVID EV / R multiples, it is in-line with companies who are materially struggling with cash flow and growth... this couldn't be further from the truth. PRPL is undervalued.

Analyst Price Targets

I don't usually give these guys much weight, but for those of you who do:

https://preview.redd.it/h13nnc7zxy751.png?width=531&format=png&auto=webp&s=f36406c5e43cd7e07757ba6459dbff5665b7e525
Marketbeat (and a few others) are inaccurately showing a lower consensus price target because they are using some very old price targets.

https://preview.redd.it/qxgstjh4yy751.png?width=1359&format=png&auto=webp&s=af9d185d18ad3db9c3bc8f44c6acecc729cc6d1a
As you look at the 7 price targets MarketBeat is using to build a consensus price target, two of them are from last year, which is ridiculously old (it's about time you update this Bank of America--you got your underwriting--now do your job). Wedbush was after earnings, but before the recent 8-K on Q2 revenue.
I put forward that the only targets that matter are those that adjusted to the 8-K revenue announcement. The consensus there is $19.75. This only matters if you follow these types of things.

Today's Price Action

I admit that this post would have been more relevant early this morning when I started writing it (the numbers part).
The price spiked late afternoon because of the attention drawn to it by a CNBC interview by CEO Joe Megibow.
https://www.cnbc.com/video/2020/06/29/purple-ceo-on-the-popularity-of-mattresses-as-americans-stay-at-home.html
In the interview, he doesn't share anything really new (for those of us who closely follow), but he does emphasize that PRPL doesn't have a return rate problem, unlike others (*cough* CSPR *cough*).

Q2 EPS / EBITDA Estimates

PRPL has generated $70M in cash during April and May, which is insane for a stock that has generated Adjusted EBITDA in the 6.2-15.3M range over the last four quarters. The quarter isn't even done yet.
I'm not putting an EPS estimate on this because the amazing cash generation is going to be partially offset by a fairly large warrant liability expense adjustment. It will likely be one of the final expense adjustments we see as the secondary offering triggered a strike price drop to zero, which is one of key things the liability expense was modelling. Regardless, warrant liability expense doesn't deserve to be an expense as the warrants themselves are already built into fully diluted EPS, which is what everyone reports. The FASB done messed up on this one.

Technical Astrology & PRPL Patterns

IMO, most technical analysis is confirmation bias at best. Here's some confirmation bias.
https://preview.redd.it/5kviazrs0z751.png?width=1166&format=png&auto=webp&s=56c8daaa52c4af31c66c9821e57e40b9362b1bcd
If you are into this type of thing, PRPL has been a series of Bull Flags since the bottom of COVID. We are now ending our fourth bull flag (which likely ended today). At least this is what stocktwits and a few other areas are raving about.
Intraday Patterns
The intraday patterns are more interesting to me. I've been watching this security fairly closely over the last 3 months since the COVID bottom, and on most days, you'll see a spike in the morning that fades away into the afternoon. It is almost like clockwork and seems to be irrespective of volume.
While I don't trade this pattern because I don't want to exit my long-term capital gains positions yet, some of PRPL gang makes money by buying in the morning (or afternoon before), selling/shorting at the peak, and then closing/buying late afternoon. Good on them!
Also, PRPLW warrants tend to lag the stock on the way up if you want to play that too.

What is your next play after PRPL?

I've already mentioned several times that I will fully exit my warrants (and rotate into some PRPL stock / long dated options) when the stock price reaches about $24. My inbox has been bombarded with questions about what my next play is.

https://preview.redd.it/t56ziwe42z751.png?width=1161&format=png&auto=webp&s=4ccef0051c2f1740d1c8059f1cb2a16188f7435c
The above chart is a comparison between CSPR and PRPL. CSPR, even though it is a total dog, has been riding up with PRPL on sympathy plays. CSPR spikes on PRPL news, conference presentations, and any other movement.
PRPL has reasons to be up. CSPR shouldn't be any higher than where it was after its last earnings release. The only new things that have occurred are dozens of IPO lawsuits.
I'll be shorting CSPR for somewhere between $100k-$500k if I end up exiting my PRPL positions before CSPR earnings and if this stupid pattern holds. It's free money.

Positions

I've got tons of warrants (closing in on $2M worth) and now 10x PRPL 22.5c 8/21.

Do your own due diligence. This is not investment advice of any kind.

submitted by lurkingsince2006 to wallstreetbets [link] [comments]

Selling Project - Part 16

Hey guys!
It has been FOREVER since my last update and a ton has happened. Sorry for the long post, but hopefully some people appreciate a detailed dive into everything.
A really really really brief recap of the past fifteen parts
I started in December of 2018 with $1,165 with the goal of making $10,000 in one year. In 2019, I had bought and sold over $40k in baseball, football and various sports trading cards. I had a few great successes ($1,165 into $3,085 before fees - $2,771.20 into $6,200.10 before fees - $1,086.68 into $3,190.54 before fees) and a few duds. I generally sell my cards on ebay, but utilize auction houses every now and then. The biggest bottleneck I face is submitting cards to PSA (a third party grading company), a card might have a 2-4 month turnaround time. To successfully "flip" you need to balance some of these purchases with shorter flips. In 2019, I ended with a final profit of $9,262.28 – a tad bit short of my goal. In 2020, my goal is $20,000 (fitting). Using my margins from 2019, I would need to sell around $85k in cards.
I also keep a few cards for my personal collection (more on that below). Here are the cards I have kept so far.
You can find the previous installment here
PERSONAL UPDATE
First, I hope everyone is doing well and staying sane. It has been an absolutely wild three months for me, I found out I’m going to be an uncle, I got a cat and I decided I was going to propose to my girlfriend this weekend! I have still been keeping up with this project, the prices for baseball cards have absolutely skyrocketed over the past couple months, so there hasn’t been the same amount of buying as usual. I am going insane with working from home and trying to keep my head above water with everything, but flipping has been (at times) a nice escape. I am fortunate enough to be flipping something that I am passionate about, baseball cards, so I am able to enjoy this and see a lot of neat cards along the way.
In that spirit I have decided to begin keeping some cards for my personal collection as I go along. I read somewhere an interesting method of collecting, reducing your collection to 25 cards. I wanted to give it a shot with a bit of a twist, I want to keep a collection of 25 cards, but still make a profit along the way. So a couple ground rules I set for myself: * The collection is limited to vintage baseball cards (generally 1980’s and older). This was my first collecting passion and I’d like to try to keep to it.

The cards need to come from a set/lot that I turned a profit on. You won’t find me buying a single card for the sake of it and I won’t lose money on a lot because I kept the best card.
I will max out the collection at 25 cards. This doesn’t mean I won’t swap out or sell cards along the way, but I won’t ever eclipse 25 cards.

First up was something completely new to me, I purchased an entire PSA graded set to sell each card individually! At the end of May I bought this beautiful 1961 Topps Set for $5,791.60 after fees. I took a major risk on this because the auction house only showed 12 of 589 cards in the set, with the remaining essentially sight unseen. Usually, when an auction house sell a complete PSA graded set, they provide an excel sheet or link to the grades of each card. It makes a HUGE difference. For example, this set, with every card graded PSA 6 is worth approximately $8,000 the same set graded entirely PSA 7 is worth $13,000. I was hoping that this set was somewhere in the middle. Luckily it was! I sold each and every card individually (less 7-8 that they originally forgot to send and one I sent to PWCC) for $11,445.51, after fees I am going to make a little over $4k, my largest flip in this project to date. This was a ton of work. There are 589 cards in the set; scanning and listing each individually took close to 20 hours over the course of a week. Packaging the cards took another 4-6 here is a picture of the cards packaged. Luckily, with selling a set, plenty of buyers purchase multiple cards (one guy bought over 80). Overall I would definitely try it again, but probably not any time soon.
In July I bought this Aaron Judge rookie card for $1,940 after taxes and fees. The two most common questions I get are whether I ever buy single cards and whether I buy modern cards. The answer is yes, but when the price is right. This card was a steal! I am expecting to easily double my investment on this one, it has already been sent to PWCC.
Finally, I bought this group of signed cards at Lelands for $1,364.40. Many of these signatures are tough to get since the players died young. Lyman Bostock died at the age of 27 in a shooting, Nellie Fox (a Baseball Hall of Famer) died at the age of 47 from cancer and Steve Macko also at the age of 27. It’s kind of a strange and morbid auction offering. I bought the group and quickly sold the the Macko for $700, the 1965 Stengel for $225 and the 1965 Howie Reed for $195. I think the only card I would be interested in keeping from here would’ve been the Stengel, but I may hold on to one for my collection.

What Sold

I FINALLY decided to list the rest of the wrappers at $.99 auction. They sold, bringing in around $1,500, led by the 1962 Fleer football wrapper. Overall, I was a little disappointed in the auction, but very happy with clearing out the inventory. Between the two wrapper lots, I made close to $2k.
I listed the last of the Huggins multi-sport group that I bought in November. Those cards came back with pretty decent grades, I consigned a few cards to PWCC, led by the Dick Butkus rookie, which sold for $1,125. With that sold, it leaves me left with just the 1951 Topps wax pack which is still with PSA. Hopefully that comes back authentic.
The B14 blankets still aren’t really moving that quickly. I sold four over the past two months. I may try to list these at auction, I’m in no rush.
I sold another one of the 1947 Bond Bread Jackie Robinson cards for $900. I sent the rest to PWCC.
The grades came back surprisingly quick for the 1954 Topps cards I purchased. I sold off the ungraded cards for $182.50 and the 1954 Topps Ted Williams Gray Back for $525. I essentially have broke even and still have the Hank Aaron rookie and Ernie Banks rookie to sell. Both are with PWCC.
PWCC also sold the 1973 Topps cards that I had sent them, bringing in an astonishing $4,340! It was led by the 1973 Joe Morgan, which sold for $1,185. I have cleared $3,483 on this group and still have 83 cards with PSA! This will be a great flip.

Item	Cost*	Sold	Fees	Inventory^	Profit
1936 Goudey Lot (8)	50.00	56.50	(8.48)	-	(1.98)
Hank Aaron "Odd-Ball" Collection	150.00	777.29	(116.59)	-	510.70
(16) Pre-WWII card lot w/ Cobb	1,300.00	1,708.52	(256.28)	-	152.24
(23) Sandy Koufax 1950's and 1960's lot	250.00	299.50	(44.93)	-	4.57
1977-1979 Topps Baseball Rack & Cello Packs (6)	250.00	380.00	(57.00)	-	73.00
1957 Swift Meats Game Complete Set (18)	800.00	680.00	(102.00)		(222.00)
(36) 1950s-2000s Multi-Sports Collection	500.00	1,528.51	(229.28)	-	799.23
1933-1989 Wax Pack Wrapper Hoard (650+)	400.00	1,918.01	(287.70)	-	1,230.31
1941-2004 Multi-Sport Group (33)	800.00	2,859.83	(428.97)	100.00	1,730.86
1912 B18 Blanket Find (100)	1,270.80	1,136.24	(170.44)	500.00	195.00
1962-63 Parkhurst Hockey Lot (45+)	500.00	287.26	(43.09)	400.00	144.17
1953 to 1969 Mickey Mantle Group (16)	1,000.00	2,747.85	(412.18)	150.00	1,485.67
1956-1959 Baseball Star Collection (48)	1,130.00	322.04	(48.31)	900.00	43.73
1961-1969 Baseball Star Collection (61)	804.95	257.78	(38.67)	600.00	14.16
1948-1965 Yogi Berra Collection (26)	1,400.00	399.50	(59.93)	1,050.00	(10.43)
Lot of (4) Signed Perez-Steele Postcards	676.59		-	676.59	-
1950's-1980's Football Wrapper Lot (42)	920.00	1,944.23	(291.63)		732.60
1953 Topps Partial Set (208)	1,472.00	2,855.13	(428.27)	100.00	1,054.86
1953-55 Dormand Postcard Set (47/52)	685.00	804.85	(120.73)	250.00	249.12
1959 & 1960 Venezuela Topps Lot (34)	216.00	58.66	(8.80)	200.00	33.86
1959 Topps Baseball High Grade Set	1,557.30	1,132.80	(169.92)	1,000.00	405.58
1970 Topps Super Proofs Lot (12)	405.41	493.75	(74.06)	200.00	214.28
1887 Allen & Ginter Boxing Lot (14)	403.40			403.40	-
1954 Topps Starter Set (119/250)	662.22	707.50	(106.13)	500.00	439.16
1947 Bond Bread Jackie Robinson Lot (6)	2,220.00	2,125.00	(318.75)	1,480.00	1,066.25
1934 R310 Butterfinger Ruth & Gehrig Lot (2)	720.00			720.00	-
1959 Topps Baseball Near Set (571/572)	3,620.00			3,620.00	-
1973 Topps Complete Set	2,512.40	6,347.41	(952.11)	600.00	3,482.90
1961 Topps PSA Graded Set	5,791.60	11,445.51	(1,716.83)	100.00	4,037.08
2013 Bowman Chrome Judge Black Wave Auto	1,940.00			1,940.00	-
1961-1982 Signed Card Lot (19)	1,364.40	1,120.00	(168.00)	800.00	387.60
	35,772.07	44,393.67	(6,659.05)	16,289.99	18,252.54

As of 8/25/2020	2020 YTD	2019 Final
Cash	$5,588.15	$1,680.15
Accounts Receivable	$6,743.43	$-
Inventory^	16,289.99	$10,605.75
Accounts Payable`	($2,886.54)	($1,858.62)
Retained Earnings	($9,262.28)	$-
Initial Capital	($1,165.00)	($1,165.00)
Revenue	($44,393.67)	($40,163.15)
Cost of Goods Sold	$19,482.08	$22,582.96
Fees (15% of Rev.)	$6,659.05	$5,956.97
Grading Fees	$2,944.79	$2,360.93

submitted by MachiavellianFuck to baseballcards [link] [comments]

Baseball Card Flipping Project - Part 16

The cards need to come from a set/lot that I turned a profit on. You won’t find me buying a single card for the sake of it and I won’t lose money on a lot because I kept the best card.
I will max out the collection at 25 cards. This doesn’t mean I won’t swap out or sell cards along the way, but I won’t ever eclipse 25 cards.

First up was something completely new to me, I purchased an entire PSA graded set to sell each card individually! At the end of May I bought this beautiful 1961 Topps Set for $5,791.60 after fees. I took a major risk on this because the auction house only showed 12 of 589 cards in the set, with the remaining essentially sight unseen. Usually, when an auction house sell a complete PSA graded set, they provide an excel sheet or link to the grades of each card. It makes a HUGE difference. For example, this set, with every card graded PSA 6 is worth approximately $8,000 the same set graded entirely PSA 7 is worth $13,000. I was hoping that this set was somewhere in the middle. Luckily it was! I sold each and every card individually (less 7-8 that they originally forgot to send and one I sent to PWCC) for $11,445.51, after fees I am going to make a little over $4k, my largest flip in this project to date. This was a ton of work. There are 589 cards in the set; scanning and listing each individually took close to 20 hours over the course of a week. Packaging the cards took another 4-6 here is a picture of the cards packaged. Luckily, with selling a set, plenty of buyers purchase multiple cards (one guy bought over 80). Overall I would definitely try it again, but probably not any time soon.
In July I bought this Aaron Judge rookie card for $1,940 after taxes and fees. The two most common questions I get are whether I ever buy single cards and whether I buy modern cards. The answer is yes, but when the price is right. This card was a steal! I am expecting to easily double my investment on this one, it has already been sent to PWCC.
Finally, I bought this group of signed cards at Lelands for $1,364.40. Many of these signatures are tough to get since the players died young. Lyman Bostock died at the age of 27 in a shooting, Nellie Fox (a Baseball Hall of Famer) died at the age of 47 from cancer and Steve Macko also at the age of 27. It’s kind of a strange and morbid auction offering. I bought the group and quickly sold the the Macko for $700, the 1965 Stengel for $225 and the 1965 Howie Reed for $195. I think the only card I would be interested in keeping from here would’ve been the Stengel, but I may hold on to one for my collection.

What Sold

I FINALLY decided to list the rest of the wrappers at $.99 auction. They sold, bringing in around $1,500, led by the 1962 Fleer football wrapper. Overall, I was a little disappointed in the auction, but very happy with clearing out the inventory. Between the two wrapper lots, I made close to $2k.
I listed the last of the Huggins multi-sport group that I bought in November. Those cards came back with pretty decent grades, I consigned a few cards to PWCC, led by the Dick Butkus rookie, which sold for $1,125. With that sold, it leaves me left with just the 1951 Topps wax pack which is still with PSA. Hopefully that comes back authentic.
The B14 blankets still aren’t really moving that quickly. I sold four over the past two months. I may try to list these at auction, I’m in no rush.
I sold another one of the 1947 Bond Bread Jackie Robinson cards for $900. I sent the rest to PWCC.
The grades came back surprisingly quick for the 1954 Topps cards I purchased. I sold off the ungraded cards for $182.50 and the 1954 Topps Ted Williams Gray Back for $525. I essentially have broke even and still have the Hank Aaron rookie and Ernie Banks rookie to sell. Both are with PWCC.
PWCC also sold the 1973 Topps cards that I had sent them, bringing in an astonishing $4,340! It was led by the 1973 Joe Morgan, which sold for $1,185. I have cleared $3,483 on this group and still have 83 cards with PSA! This will be a great flip.

Item	Cost*	Sold	Fees	Inventory^	Profit
1936 Goudey Lot (8)	50.00	56.50	(8.48)	-	(1.98)
Hank Aaron "Odd-Ball" Collection	150.00	777.29	(116.59)	-	510.70
(16) Pre-WWII card lot w/ Cobb	1,300.00	1,708.52	(256.28)	-	152.24
(23) Sandy Koufax 1950's and 1960's lot	250.00	299.50	(44.93)	-	4.57
1977-1979 Topps Baseball Rack & Cello Packs (6)	250.00	380.00	(57.00)	-	73.00
1957 Swift Meats Game Complete Set (18)	800.00	680.00	(102.00)		(222.00)
(36) 1950s-2000s Multi-Sports Collection	500.00	1,528.51	(229.28)	-	799.23
1933-1989 Wax Pack Wrapper Hoard (650+)	400.00	1,918.01	(287.70)	-	1,230.31
1941-2004 Multi-Sport Group (33)	800.00	2,859.83	(428.97)	100.00	1,730.86
1912 B18 Blanket Find (100)	1,270.80	1,136.24	(170.44)	500.00	195.00
1962-63 Parkhurst Hockey Lot (45+)	500.00	287.26	(43.09)	400.00	144.17
1953 to 1969 Mickey Mantle Group (16)	1,000.00	2,747.85	(412.18)	150.00	1,485.67
1956-1959 Baseball Star Collection (48)	1,130.00	322.04	(48.31)	900.00	43.73
1961-1969 Baseball Star Collection (61)	804.95	257.78	(38.67)	600.00	14.16
1948-1965 Yogi Berra Collection (26)	1,400.00	399.50	(59.93)	1,050.00	(10.43)
Lot of (4) Signed Perez-Steele Postcards	676.59		-	676.59	-
1950's-1980's Football Wrapper Lot (42)	920.00	1,944.23	(291.63)		732.60
1953 Topps Partial Set (208)	1,472.00	2,855.13	(428.27)	100.00	1,054.86
1953-55 Dormand Postcard Set (47/52)	685.00	804.85	(120.73)	250.00	249.12
1959 & 1960 Venezuela Topps Lot (34)	216.00	58.66	(8.80)	200.00	33.86
1959 Topps Baseball High Grade Set	1,557.30	1,132.80	(169.92)	1,000.00	405.58
1970 Topps Super Proofs Lot (12)	405.41	493.75	(74.06)	200.00	214.28
1887 Allen & Ginter Boxing Lot (14)	403.40			403.40	-
1954 Topps Starter Set (119/250)	662.22	707.50	(106.13)	500.00	439.16
1947 Bond Bread Jackie Robinson Lot (6)	2,220.00	2,125.00	(318.75)	1,480.00	1,066.25
1934 R310 Butterfinger Ruth & Gehrig Lot (2)	720.00			720.00	-
1959 Topps Baseball Near Set (571/572)	3,620.00			3,620.00	-
1973 Topps Complete Set	2,512.40	6,347.41	(952.11)	600.00	3,482.90
1961 Topps PSA Graded Set	5,791.60	11,445.51	(1,716.83)	100.00	4,037.08
2013 Bowman Chrome Judge Black Wave Auto	1,940.00			1,940.00	-
1961-1982 Signed Card Lot (19)	1,364.40	1,120.00	(168.00)	800.00	387.60
	35,772.07	44,393.67	(6,659.05)	16,289.99	18,252.54

As of 8/25/2020	2020 YTD	2019 Final
Cash	$5,588.15	$1,680.15
Accounts Receivable	$6,743.43	$-
Inventory^	16,289.99	$10,605.75
Accounts Payable`	($2,886.54)	($1,858.62)
Retained Earnings	($9,262.28)	$-
Initial Capital	($1,165.00)	($1,165.00)
Revenue	($44,393.67)	($40,163.15)
Cost of Goods Sold	$19,482.08	$22,582.96
Fees (15% of Rev.)	$6,659.05	$5,956.97
Grading Fees	$2,944.79	$2,360.93

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Cash OR Margin Trading - कौन ज़ायदा बेहतर - in हिंदी Cash Account vs Margin Account - Ultimate Guide - YouTube Cash and Margin Trading Accounts and Which is Right for You Cash vs Margin Accounts - PDT Rule Trading 101: What is a Margin Account? - YouTube

Cash Account vs. Margin Account: An Overview . Investors looking to purchase securities can do so using a brokerage account.The two main types of brokerage accounts are cash accounts and margin Choosing the account that works best for your trading style and needs is an important decision that could have significant ramifications for you financially. Understanding how a brokerage settles trades can make the difference in your decision to use a margin account or stick with a cash account. Margin Account vs. Cash: Which is Better for You? In this post, we’ll look at the key differences between a margin account and cash account, and help you determine which one might be the better choice for you. For example, let’s say you’ve decided to start trading stocks. You’ve read some tutorials and watched some videos … The loan in the margin trading account is collateralized by the securities you purchase. While you hold securities using margin, if the value of the stock drops significantly, the account holder will be required to deposit more cash, more marginable securities, or sell a portion of the securities to maintain the minimum margin requirements. The settlement for cash accounts is 2 business days. Margin accounts allow you to borrow money against the value of the securities in your account. For example, if you have $2,500 in a margin account, you could use additional margin funds of up to $7,500 supplied by Webull, to purchase $10,000 worth of stock.

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Cash OR Margin Trading - कौन ज़ायदा बेहतर - in हिंदी

The ultimate guide to cash vs margin accounts. If you currently have trouble deciding between these two account types, this video should help you with your d... Understanding the difference between Cash and Margin accounts is vital when it comes to the stock and trading industry. In this video I give you guys an in dept breakdown of both Cash and Margin ... Trading 101: What is a Margin Account? Come join me for a live session where I talk more about trading, the markets and all the money that can be made. Claim... Cash and Margin Trading Accounts and Which is Right for You - Duration: 8:32. 1215 Day Trading 563 views. 8:32. Cash Account vs Margin Account - Ultimate Guide - Duration: 16:05. What is margin trading? What is a margin? What is the difference between a cash account and a margin account? In episode #34 of Real World Finance we dive de...