Leverage Loan for Investing

[fyretrading]

Everyone can 'borrow' at libor by buying futures contracts without having to put any money down, only collateral, which can be other securities

Where can I do this ? do you need a prime brokerage?

 

[Daal]

Where can I do this ? do you need a prime brokerage?

If you need to ask, you probably shouldn't know the answer

 

[fyretrading]

If you need to ask, you probably shouldn't know the answer

I tried to do what your saying with eurodollar futures and it doesn't work as you say.

 

[ross1985]

i think ur adviser did a half his job, borrowing at low rates can be attractive to fund investments if u know the odds are high and personally if u knew ur self what ur doing where the loss is minimized, lastly how much of ur income does the 3500 a year represent, cuz sometimes the best investments are not available immediately, so borrowing at a low rate might be good if u know to invest it at a higher rate and u might have to absorb the interest for few years if that opportunity is not,

the big question is whats ur investments experience now? is it still limited or is it much better?????

if limited i would close out the investment right away, cuz what would happen if its at 80k instead of a 100?? can u afford the 20k loss???? how did u feel when it was down to 88k???? did it shake u or is ur networth/income larger where it wasnt the issue, u must take these factors into account,,,

borrowing at 3.5% is awesome which not everyone has the access to it,,, but only if there is a good use to it with great confidence and limits to losing (as in whats worse case scenario),,,,

i used to do something similar to this back in the days borrow at lower rate to invest at higher but my experience was limited back then and i got hammered, the only thing that kept me afloat is the fact my income from my current job can dwarf the amounts i took and i recovered,,, but in terms of borrow low invest high i miserably failed, at least back then

there is been times i also borrowed to invest but when i didnt find anything good use for it and i paid back the money and ended up losing on the interest for the 7 months i had the money,,, point is dont force the trade(investment)

I actually closed out the investment this week. It sucks that I have to walk away with a $4000 loss, but it's been a good learning experience. At the time when I started the leverage fund, I knew absolutely nothing about investing. I think the strategy definitely could have worked if the segregated funds weren't so terrible. During the two years, my own investment picks greatly outperformed the fund that was suggested, which was annoying. When the fund was down to 88k it was stressful, but I felt it would be unwise to exit prematurely. A part of me wanted to keep the fund longer to see if I could make some profit, but given the performance of these segregated funds I just felt like it was better to quit now.

 

[systematictrader]

I actually closed out the investment this week. It sucks that I have to walk away with a $4000 loss, but it's been a good learning experience. At the time when I started the leverage fund, I knew absolutely nothing about investing. I think the strategy definitely could have worked if the segregated funds weren't so terrible. During the two years, my own investment picks greatly outperformed the fund that was suggested, which was annoying. When the fund was down to 88k it was stressful, but I felt it would be unwise to exit prematurely. A part of me wanted to keep the fund longer to see if I could make some profit, but given the performance of these segregated funds I just felt like it was better to quit now.

u closed out the investment but what about the loan? whats ur plans for it? pay it back or continue to invests

with all due respect u picking the investments and saying they outperformed doesnt necessarily mean u wouldve done so cuz when real money is on the line many things change, the most important thing that changes is the question of when do u exit?

iam not saying u couldnt have done it but these things take a long time to get a grip of

i always hear many people (not you) say oh oh oh if i bought google or apple or mcdonalds back then for 5k i would be a millionaire today,,,, the answer for 99% is no no no no

why cuz they jumped from point A to point Z without looking at the interim, the average person if they buy 5k worth of a stock and they are lucky enough to see it go to 50k which is only 5% of one million would take their money out without a second thought,, the bigger the amount the faster they cash out,, they will say oh i need to buy this or that,,, and even if they take out only half there they just cut the future million to half a million,,, i know I myself whos been trading long time i cant handle that magnitude above let aside getting someone who is lucky enough to pick the right stock the right time, the point is picking the investment from A to Z is one thing, sticking with it in the interim is another, specially when we all know the rise upward from 5k to 1M is NOT a smooth ride

 

[algofy]

If your advisor put you into 100% equities in total without regard to a bond/fixed income component on your personal balance sheet. Then, he obviously wasn't advising according to your best interests. Not foul play, but it's gross negligence.

You need to cut risk and put funds in a short-term cash alternative until you figure out what is right for you. This is not trading money...yet.

No reason to be in bonds if young and have a long investing horizon.

 

[systematictrader]

Everyone can 'borrow' at libor by buying futures contracts without having to put any money down, only collateral, which can be other securities

yes u can buy this method but ur forced to play in that field only, its different when u can borrow at 3.5% and do whatever u want with the money such as buy div stocks or accounts that pay 5% or more,, etc

 

[algofy]

u closed out the investment but what about the loan? whats ur plans for it? pay it back or continue to invests

with all due respect u picking the investments and saying they outperformed doesnt necessarily mean u wouldve done so cuz when real money is on the line many things change, the most important thing that changes is the question of when do u exit?

iam not saying u couldnt have done it but these things take a long time to get a grip of

i always hear many people (not you) say oh oh oh if i bought google or apple or mcdonalds back then for 5k i would be a millionaire today,,,, the answer for 99% is no no no no

why cuz they jumped from point A to point Z without looking at the interim, the average person if they buy 5k worth of a stock and they are lucky enough to see it go to 50k which is only 5% of one million would take their money out without a second thought,, the bigger the amount the faster they cash out,, they will say oh i need to buy this or that,,, and even if they take out only half there they just cut the future million to half a million,,, i know I myself whos been trading long time i cant handle that magnitude above let aside getting someone who is lucky enough to pick the right stock the right time, the point is picking the investment from A to Z is one thing, sticking with it in the interim is another, specially when we all know the rise upward from 5k to 1M is NOT a smooth ride

Damn your posts are long, can't read that much at one time, have you been consulting with @wrbtrader ?

 

[systematictrader]

Damn your posts are long, can't read that much at one time, have you been consulting with @wrbtrader ?

dont read them then, there is no extra credit for reading it all !!!!

 

[algofy]

dont read them then, there is no extra credit for reading it all !!!!

I generally don't read them.