A simple thread to help all understand ‘Futures and Options’ in an easy way. Though I would personally not recommend new investors to trade in F & O, but it is always good to know things. 👇🧵

#Investing #Investors #Options #Futures

1. What is a ‘Derivative’?
‘Derivative’ simply means a product which is derived or dependent on some asset. This asset is called as ‘underlying asset’.
Let me simplify this by putting this example.

Both ‘Coffee’ and ‘Tea’ require ‘Milk’ for their making (assuming that you drink it that way, of course) . Hence, if the price of ‘Milk’ increases, the prices of ‘Tea’ and ‘Coffee’ will also increase.

To sum up:
1.‘Milk’ is the independent product. So, it will be considered as ‘Underlying Asset’.
2.‘Tea’ and ‘Coffee’ derive their prices from the price of ‘Milk’. Therefore, these are ‘Derivatives’ of Milk.

Hence, the derivative of a company will derive its price from the price of the shares of a company. Thus, share of a company is the ‘underlying asset’.

**Thread**

The Chop.

The chop is brutal and I want to discuss more about what goes on inside a Traders mind when we form a choppy range and when we're inside a choppy range.

I hope you can take some lessons from this to adapt to these situations in the future.

RTs appreciated

The chop usually forms after strong moves in one direction or another, for this we'll keep the focus on BTC and use "up" as our direction for discussion.

So, $BTC rips higher, we're approaching ATH, you can't go wrong being long, then something changes.

As we move higher, as we approach key levels, your mindset changes. Sometimes you can feel invincible, you've simply had to push the green button for 2 weeks and you've been in profit.

Anticipation grows and dreams of smashing through ATH into new territory continue to build.

This is where the first issue comes in to play.

1. Overconfidence and the assumption that you have to be correct.

Your mindset begins to look like this. Everything is now skewed towards your confidence in breaking through $20,000. Everything sets up as an ATH break.

2. Absorption of Information.

At the same time as your own mind racing to higher targets. Twitter begins pouring fuel on the fire.

"Retail isn't even here yet!"
"Impulse from $20k could lead to $30k!"
"Can you imagine the liquidations above $20k?"

You're fed more information.

1) This year has been difficult for many investors, whether you are a novice or an experienced risk taker.

It would be useful to revisit today's money masters and see how they dealt with gut-wrenching loss.

It always helps renew my ambition. THREAD 👇

2) Paul Tudor Jones lost $10,000 when he was 22, and when he was 25 he lost about $50,000, which was all he had to his name.

3) In 1979, PTJ's fourth year in the business, he lost over 60% of the equity in his clients’ accounts on a single cotton trade that went horribly wrong.

“I am not cut out for this business," he said. "I don’t think I can hack it much longer.”

4) Relating the episode to Jack Schwager in Market Wizards, he revealed:

"It was a cathartic experience for me, in the sense that I went to the edge, questioned my very ability as a trader, and decided that I was not going to quit. I was determined to come back and fight."

5) That was when he first decided that he had to learn discipline and money management.

As Richard Dennis used to say to new traders, “When you start, you ought to be as bad a trader as you are ever going to be.”

1/18

Long thread ahead of $TSLA's first S&P week with some advice.

First off, to people only holding stock, my general advice is sit back, relax, and watch the show. Even before factoring in Tesla Energy and Autobidder, EVTOL jets, cooperation with The Boring Company, HVACs,

2/18

manufacturing as a service, electric boats, and various other potential lines of business, Tesla's long-term potential is enormous.

Tesla is basically untouchable in automotive, autonomy, and autonomous mobility as a service. Tesla will be a monster of a company 10-15 ...

3/18

years from now, selling and managing massive fleets of AEVs. If you're worried $TSLA might be becoming overvalued, perhaps so looking backwards, but it's still a hell of an investment looking far into the future.

I explained all this in this

4/18

For people who have no choice but to time the market during the next couple of weeks, either because they hold options, or because of a need to sell some shares (living expenses, big purchase, etc.), I have three pieces of advice.

5/18

My first piece of advice is to be aware of what outcomes are unacceptable to you, and to eliminate the possibility of them occurring entirely.

A nobody cares thread.

Nobody cares about the things that matter - getting investors in, helping new distributors advisors, making things (Slightly) easier for investors, honest mis-selling etc.

Nobody cares about direct plans of mutual funds

Nobody cares about about mutual funds either

Very few care about mutual funds. Just 2.1 crore unique investors. If you probably take out HNIs/institutions in this, that's maybe 20-30%, what's left are the common gareeb folks.

Nobody cares about direct equity investing either.

Next time when someone says, people are moving away from mutual funds to direct equities, show them this and punch them in the throat.

Only 1.5 cr active demat accounts. If you remove duplicates, maybe 60% of this?

Nobody cares because very few people have money to care either?

Analyzed last 12 years of historical data to check if there are any patterns we can observe to find the best time to invest in stocks for long term. #Nifty50 #investing #stocks 1/10

This is how Nifty moved in last 15 years with three major corrections, in the year 2008,then around 2016 and then year 2020 due to Coronavirus. Only when we look back with hindsight bias we could say those were the best time to invest. But is there really any quantitative method?

200 day moving average is something that is widely used by many investors to check for long term trend. Where investors consider if stocks trades above 200 DMA, its in bullish phase and if it trades below 200 DMA its in bearish phase.

We shall run an analysis to find out of Nifty 50 stocks, how many number of stocks trades above 200 day moving average, higher the number, stronger the market. we need correct data, we cannot test it with current Nifty 50 stocks,

we need list of Nifty 50 stocks that are part of index historically, so when we run for Jan 2008, stocks like RPL, RNRL, UNITECH were part of Nifty 50, so it is essential to test it with correct datasets.

Letter from the stock markets to the sceptics: "I may be high, but I'm not crazy." Caution, this thread may not age well, but I didn't really write it :).

~Thread from a twitter economist.

They world is in one of the biggest crisis since the 2nd world war, but the stock markets seem to be on a relentless upward move. They appear completely divorced from reality. Really? Probably not. Here are reasons why the markets may be euphoric, but aren't crazy or stupid.

a) Lot of liquidity provided by central banks to rescue failing businesses - globally. Central banks and governments buying all kinds of securities including junk bonds directly!

b) Much of the western world is in the arena of 0 or negative interest rates, and anything which moves (above 0 returns) looks tasty enough to be eaten (bought)

c) The Sensex is just around 10% up from its January levels - so not really frothy territory (if you were to ignore the epidemic)

Have you ever wondered why price of large cap cos like Reliance ind. Ltd. or Apple inc. fluctuates less in magnitude but share price of a small cap co witnesses huge volatility?
A simple thread to explain the economics behind stock fluctuations!👇🧵
#investing #financialliteracy

1. Penny stocks show huge volatility but on the other hand stock of large cap companies show little fluctuations.
Did you ever observe how ‘Foreign Exchange’ rates show little fluctuation and are range bound?
Let us understand the economics behind it.

2. In this thread we will learn two things,
👉Why large companies show quick change in their prices though the magnitude of change is less?
👉What causes huge jump in prices of penny stocks? Or why on a bad day they can easily fall with huge magnitude?

3. First things first. Let us understand who decides the price of goods? Is it the ‘Buyer(s)’ or the ‘Seller(s)’?
The answer to this basic question is that price is decided by both of them.

This is because,
👉 A ‘Buyer’ would always be willing to buy any commodity at lesser price.
👉 A ‘Seller’, on the other hand would try to sell his product at a greater price.

Australian iron ore producer Fortescue (FMG AU) is a great example of how value investing often works in practice. In 2018 the stock was trading for A$4. It was cheap at spot iron ore - a mid single digit FCF multiple, even w historically high discounts on low-grade 58pc Fe (1/n)

The reason it was cheap was investors believed the increased 58pc discount was structural not cyclical, and benchmark iron ore prices of US$60-70/MT were not sustainable - Chinese demand would surely falter, and send prices down to US$40-50/MT (2/n).

I basically agreed with the market. That was also my expectation. But I decided to buy some anyway because I recognized I could be wrong, and if either iron ore prices stayed at US$60/MT or rose; OR 58pc discounts narrowed to historical levels, the stock would prove very cheap.

Meanwhile, the stock was fairly priced on the base case market expectation (mirroring my own), at perhaps a HSD FCF yield. Not many investors make an investment on the basis that they might be wrong, but I did due to (1) the asymmetry; and (2) the future being hard to predict.

So what happened? Unexpectedly, there was a Vale dam failure in Brazil, taking out several 10ms MT of supply. Chinese demand remained strong. 58pc discounts narrowed, and covid further interrupted Brazilian supply, while Chinese have stimulated infra to offset covid headwinds.

1/x ‘Twas the night before Christmas & all through the market not an order was stirring not even for $TGT.
The bonuses were entered into payroll with care,
In hopes that next year would bring a similar fare;
The Bulls were nestled all snug in their beds;

2/x While visions of $TSLA danced in their heads;
& Biden in his Covid mask, & Powell with his still flowing money tap,
Had just settled their brains for a long winter's nap,
When out on the screen there arose such a clatter,
All sprang from their beds to see what was the matter.

3/x Away to their monitors they flew like a flash,
Tore open their Bloombergs & threw up the dash(board).
The S. Claus rally in markets, that all of us know,
Paired w/vaccine reopening, Gave a bid to the market, leaving old prices below,
When what to their wondering👀 did appear?

4/x But a Georgia runoff rushing up to them with complacency, not fear...
With once reliable Vanna flows no longer lively & quick,
They knew in a moment the markets might get quite sick...
Unexpected, 2 Georgia Dem peaches into Congress they came,

5/x Whistling & shouting they called for more fiscal, ‘CARES Too’ its new name:
"Now, Healthcare! Now, Infrastructure! Now Green Energy & Protectionism!
On, Labor rights! on, Minimum Wage! on, Basic Income & Populism!
To middle class households, To the poorest of them all!

So I thought the whole "paid newsletter" thing was dumb.

So naturally, I tried it out as an experiment.. The results were kinda nutty. The newsletter started bringing home $49k per month (!) -- Here's the backstory

"what was the newsletter about?"

Well - for the past year, I've been doing a podcast called My First Million. Gimmicky name, but whatever.

It's a pod where me and @theSamParr (and friends like @awilkinson @_jacksmith etc.) brainstorm business ideas based on trends we see

Anyways - the podcast has gotten pretty big. We do over 350k downloads/month.

People like listening to us shoot the shit, brainstorming ideas.

But as the nearest schmuck will tell you - ideas aren't shit without execution!

The problem is - execution is less sexy.

Usually when people talk about execution, it's in the past tense. We did X, and voila, we won.

They edit & cut out all the dead ends they hit, the stuff they tried that failed.

This gives people a f*cked up idea of what execution really is.

Still - there's demand for learning how to execute better.

The number one question I get in my DMs everyday is: "I love that idea from the pod, how would you approach it?"

There's no simple answer. So for months I just ignored them.

The battle all $XRP holders were waiting for. I’m sure lots of holders will be debating whether to sell off this news... a few

and @bgarlinghouse will have anticipated this decision by @SEC_News for years, in which time they’ve built out an extremely experienced exec team who are poised and ready for this legal battle to commence.

has led a great PR narrative over the last year, pressing hard for reg clarity in the US via media and threatening to up sticks and move @Ripple overseas. Have the SEC played into his plan to force regulatory clarity that may not have otherwise came quick enough?

has shareholders who will expect certain growth in certain timeframes. Has Brad dangled the right carrot to get their attention by talking about leaving the US? Will this suit get legal clarity for $XRP quicker than waiting for industry wide clarity?

If I can work that out, I’m sure he can.

This isn’t just a small startup, it’s a global company with extremely reputable board members, partners and investors, who will also add pressure to the SEC’s case. Take @yoshitaka_kitao in Japan for example.

Excellent compilation of Forbes articles on Warren Buffet from 1969 to 2000s. h/t @valuewalk 👏

@dmuthuk @Gautam__Baid

https://t.co/V7uTYjwSrn

Reading articles from the actual period (instead of books written after he was already widely famous) provides more interesting details on how his investing process evolved over the decades..

->Pure Balancesheet & Valuation based investing(50s/60s)

-> Purchases based on Intangibles/Brands & Moats (70s)

-> Convertible Stocks (80s)

-> Acquiring overall Companies (90s onwards)....

Few interesting quotes from the document.

“Investment is most intelligent when it is most business-like”—in other words, not swayed by emotions, hopes, fads.

“I think of it in terms of buying a whole company just as if I were buying the store down the street. If I were buying the store, I’d want to know all about it."

🚨 GLOBAL GEMS (+100 Stocks) 🚨

🇸🇪 SWEDEN
$MIPS
$EVO
$PLEJD
$EMBRAC
$KAMBI
$FNOX
$SPOT
$247
$SINCH
$CLINKB
$GETIB
$PDX
$MTGB
$LIME

🇳🇴 NORWAY
$HBC
$MEDI
$PSKY
$KAHOOT
$CARA
$AZT
$ZAPME
$SSO

🇫🇮 FINLAND
$KNEBV
$REMEDY
$REG1V

CONTINUED 👇

🇩🇰 DENMARK
$COLOB
$NZYMB
$CHEMM
$NETC.CO
$FOM
$VWS
$SIM

🇵🇱 POLAND
$ALE
$CDR

🇩🇪 GERMANY
$DHER
$ZAL
$M0Y
$YSN
$ST5
$ELG
$TMV

🇮🇹 ITALY
$NEXI
$RACE

🇪🇸 SPAIN
$CLNX

🇦🇹 AUSTRIA
$FAA

🇬🇧 UNITED KINGDOM
$DEO
$TM17
$GMR
$OCDO

CONTINUED 👇

🇧🇪 BELGIUM
$MTLS

🇫🇷 FRANCE
$UBI
$RMS
$MC

🇳🇱 NETHERLANDS
$PRX.AS
$ASML
$ADYEN

🇦🇺 AUSTRALIA
$APT
$EOS
$XRO

🇨🇦 CANADA
$WELL.TO
$DCBO
$LSPD
$REAL.TO
$CNI
$NVEI
$AT.TO

🇷🇺 RUSSIA
$YNDX
$OZON

CONTINUED 👇

🇰🇷 SOUTH KOREA
$GRVY

🇯🇵 JAPAN
$NTDOY
$FRCOY
$LSRCF
$4477.T
$NJDCY

🇨🇳 CHINA
$PDD
$JD
$XPEV
$BYD
$BABA
$FUTU

🌏 SOUTH EAST ASIA
$SHNUF
$SE

🌎 LATAM
$MELI
$PAGS
$STNE
$DESP

🌍 AFRICA
$JMIA

🌐 ROW
$KASPI.KZ

CONTINUED 👇

🇭🇰 HONG KONG

$1810 Xiaomi
$1585 Yadea
$0853 Microport
$6160 Beigene
$6969 Smoore
$6098 Country Garden Svc
$6862 HaiDiLao
$2013 Weimob
$9923 YeahKa
$0268 Kingdee
$0241 Ali Health
$2331 Li Ning
$1347 Hua Hong Semi
$2382 Sunny Optical
$1337 Razer

Thread:

"When is Alt Season?" is a question we all ask a lot so let's take a look at a possible scenario that could answer that question.

The last real alt season occurred directly following the Dec. 17, 2017 $BTC ATH.

IMO we need Bitcoin to make a real run before it brings back the dumb money.

The previous Bitcoin run up began approx Dec. 16, 2016 when it broke its previous high and began a journey into price discovery. Let's compare that to now. We just poked through to a new ATH the other day, but the journey is just beginning. In 2016 alts didnt immediately go nuts

when btc entered price discovery. There are windows of alt movements during a larger bitcoin move where you get mini alt seasons such as June-July 2017 and most recently, May-Aug 2020. These are just periods where Bitcoin ranges and lets alts move.

So, what started the '17-'18 season then? Well, that's easy. FOMO

That FOMO didn't begin until roughly November of 2017, 11 months AFTER Bitcoin entered price discovery.

And the mania didn't begin until early December 2017 almost 1 year after Bitcoin entered price discovery.

In this #IPO frenzy market, lets talk (Thread) about some basics around
-Angle/VC/PE
-Allotment process
-IPO Funding
-Grey Market

Hit the ‘re-tweet’ & help us educated more investors (1/n)

Why do companies come out with an IPO?

(a) Funding needs
- Business expansion plans
- Debt payoff

(b) Non-Funding requirement
- Enhancing corporate stature
- Exit options to large investors like the VCs & PEs (2/n)

While most of us believe IPOs are for funding requirements, you deep dive and understand it’s more of an exit channel for large investors (VC/PE). Let me explain the same concept from a start-up's perspective (3/n)

If u r starting off ur entrepreneurial journey & need capital, how do u raise funds?
-Self Funding
-Friends & Relatives (F&R)
-Bank Loan
-Angel Investor
Angel investors r the 1s who invest @ the idea stage & PE/VC who invest in the growth phase of the company.(4/n)

- Self funding can be the best option but everyone’s not prepared
- F&R I wish helped
- Bank loans need collateral and
- Angel investors invest only when they see scalability in the business and hence a belief that they will get their investments back. (5/n)

BREAKING: The EU and UK have agreed a trusted trader scheme that would mean exemptions from tariffs for up to 98pc of goods flowing between Great Britain and Northern Ireland from January 1, @rtenews has learned.
The other 2% wd potentially avail of rebates from any tariffs.

2/ Tariffs would mostly only apply if no free trade agreement is concluded between the EU and UK.

Both sides have also agreed that agrifood products coming from GB to Northern Ireland will be exempt from requiring export health certificates for a period of at least three months

3/ These have proved the biggest concern for UK supermarket chains in NI, who rely on large and mixed consignments of food coming from GB depots.
Export health certificates can cost up to £200 per product and need to be signed off by a designated veterinary inspector.

4/ It’s understood the issue of how supermkts will comply with EU food safety rules could be dealt with through a UK commitment - possibly a declaration - that it does not intend to change its food safety rules from Jan 1. At that point the rules will be the same as the EU's.

5/ The trusted trade scheme would be subject to a review, or sunset clause, three and a half years after the Protocol comes into effect, according to an internal EU briefing