Suggestions for a speculative punt?

maxsteam

adindas said:

I think people prefer an account where their gain is protected from the taxman e.g., S&S ISA account, SIIP account for their investment. I wonder which investment platform will allow you to do option/CFD trading but wrapped under ISA/SIIP account.

Different people prefer different things. Following the crowd is generally not a good investment strategy. While I have ISAs and SIPP, I don't mind paying taxes if I make gains and I certainly won't entertain crafty IFA schemes. There are set rules about what is allowed in ISAs. Options, warrants and futures are specifically excluded. I'm not 100% certain about CFDs but I expect, as they avoid stamp duty, they will be excluded too.

adindas said:

If you coukd find better than Trading212, FreeTrade, eToro in term of trading fees, please let me know. Unfortunately eToro does not offer SIIP/ISA, but all of these small guys are covered by FSCS.

DeGiro is not covered by FSCS, but it is stil covered by similar compensation schemes to FSCS from another country.

I think IG is also good, but have not looked into detail.

Trading212, FreeTrade.io and eToro are different from mainstream brokers in that they do not have direct access to any major stock exchange. They can use an intermediary or they can make their own market. If they can convince customers to trade an obscure cryptocurrency or shares in a tiny company, they can widen the spread to levels that experienced investors will find unacceptable. Degiro are mainstream in that they have direct access to all the Euronext Exchanges and other major stock exchanges. I have not heard anyone grumbling about Degiro's fees.

The FSCS only covers cash balances. In my opinion, if you are worried about your broker going bust, you should use a different broker.

I have used IG Index. In my opinion they are more of a gambling site than an investment site. They do offer options but their spreads are often five times what Degiro offer on similar products. I suspect that IG make their own markets in products that differ slightly from the mainstream. They "name" some indices slightly differently to the accepted names and their options expire at different times to the Euronext options. With a mainstream broker the spread is set by the stock exchange and the commission is set by the broker. I cannot see how IG can justify such large spreads on their options unless they are different products to those offered by the stock exchanges.

adindas

https://www.youtube.com/watch?v=4IhSkIUhjF0

Peter Lynch: 'I love volatility'

Lucky you who sold the stock at lost during the market rotation / correction in the last two weeks. You will regret doing that when you see the market signal today. We live and learn.

Lynch firmly believed that individual investors had inherent advantages over large institutions because the large firms either wouldn't or couldn't invest in smaller-cap companies that have yet to receive big attention from analysts or mutual funds.

https://www.investopedia.com/articles/stocks/06/peterlynch.asp

The moral of it, do not be afraid to invest in a small market cap companies as long as you do your own DDs. $500m market cap is normally the threshold where the hedge fund managers start looking the stock seriously. If you only invest in the companies with market cap $500m+ all you get is the one these hedge fund manager do not want. Similarly with the SPACs stock near NAV.

When you start investing before this hedge fund manager did, once the stock market cap reaches $500m due to the stock price increase, let them ride the price up and all you need to do is to start watching the show nicely.

csgohan4

SHOE was mentioned on here, but has had a surge in price over the last month with room to grow. I know BH mentioned not much increase due to the appetite of working at home more. I think some of us are tired of WFH and want to return back to normality. 

Something to watch potentially. Do your own research

Might put in some coin in with the ISA limits refreshing next month

Malthusian

maxsteam said:

adindas said:

I think people prefer an account where their gain is protected from the taxman e.g., S&S ISA account, SIIP account for their investment. I wonder which investment platform will allow you to do option/CFD trading but wrapped under ISA/SIIP account.

Different people prefer different things. Following the crowd is generally not a good investment strategy. While I have ISAs and SIPP, I don't mind paying taxes if I make gains and I certainly won't entertain crafty IFA schemes. There are set rules about what is allowed in ISAs. Options, warrants and futures are specifically excluded. I'm not 100% certain about CFDs but I expect, as they avoid stamp duty, they will be excluded too.

CFDs are indeed excluded from ISAs but not because they are exempt from stamp duty. (Why would the Government care about not getting tax on a tax-free wrapper? Plus CFD punters pay taxes via the corporation tax levied on the bookie's profits.) It's because of the risk involved. ISAs are viewed as a "kitemark" and have generally excluded exotic financial instruments unsuitable for retail investors. That principle has been steadily undermined, e.g. by the IFISA (and the consequent feeding of ISA investors into the jaws of London Capital and Finance and smaller scams) but it still exists.

AIM shares were excluded from ISAs for a long time as well - that has now changed. (Until the change, investors with large ISAs and an eye on inheritance tax planning were caught between a rock and a hard place, where they needed to forfeit all those years of using their ISA allowance in order to invest IHT-efficiently.)

The principle behind the ISA is that it makes sense to the Government to encourage ordinary subjects to save and invest to make them less dependent on state benefits. Any investment that will lose money for most investors is therefore unsuitable for an ISA from the government's perspective, let alone the investor's.

This is not a judgment on anyone's trading ability, just a statistical fact about the most common outcome of retail investors buying CFDs.

adindas

Heat Map S&P 500 one week performance. The stock market has been falling since over two weeks ago.

ARK Invest strategy in dealing with market crash, market correction.

Move the money the the highest conviction stocks when there is signal that the market is bouncing back to buy highest conviction stocks at a lower price.

The lowest conviction stocks to be used as a cash instrument ready to be sold to prepare cash to buy the highest conviction stock.

Please do your own research before appying this strategy and apply with your own risk.

BrockStoker

adindas said:

https://www.youtube.com/watch?v=4IhSkIUhjF0

Peter Lynch: 'I love volatility'

Lucky you who sold the stock at lost during the market rotation / correction in the last two weeks. You will regret doing that when you see the market signal today. We live and learn.

Lynch firmly believed that individual investors had inherent advantages over large institutions because the large firms either wouldn't or couldn't invest in smaller-cap companies that have yet to receive big attention from analysts or mutual funds.

https://www.investopedia.com/articles/stocks/06/peterlynch.asp

The moral of it, do not be afraid to invest in a small market cap companies as long as you do your own DDs. $500m market cap is normally the threshold where the hedge fund managers start looking the stock seriously. If you only invest in the companies with market cap $500m+ all you get is the one these hedge fund manager do not want. Similarly with the SPACs stock near NAV.

When you start investing before this hedge fund manager did, once the stock market cap reaches $500m due to the stock price increase, let them ride the price up and all you need to do is to start watching the show nicely.

"Lynch firmly believed that individual investors had inherent advantages over large institutions because the large firms either wouldn't or couldn't invest in smaller-cap companies that have yet to receive big attention from analysts or mutual funds."
It's a double whammy for the investor who finds a great stock when it's small. If you do find such a stock, and it only registers on the institutional radars after you buy it, you can accumulate large gains fast as the institutions pile in, and then further gains as average Joe piles in on top (if it's that kind of stock - if it's not, look for another stock - a stock that everyone else wants is never a bad thing!). As you say though, if you don't do some due diligence, you're taking a risk you don't need to be taking. Know what you own.

maxsteam

Malthusian said:

CFDs are indeed excluded from ISAs but not because they are exempt from stamp duty. (Why would the Government care about not getting tax on a tax-free wrapper? Plus CFD punters pay taxes via the corporation tax levied on the bookie's profits.) It's because of the risk involved.

But there is stamp duty on purchases of UK shares in an ISA. The nature of CFDs makes them no safer or riskier than the corresponding shares. The risk comes from the way they are marketed to inexperienced investors on a number of platforms. It is possible, for example, for someone with only £5000 spare cash to "buy" £100000 of CFDs. That £100000 of CFDs has no greater or lesser risk than the corresponding shares. The problem for that investor comes when the value drops to £99000 and that person, who only had £5000 to deposit, must now either close their position or find some more money. The problem would not arise for someone with £100000 to invest.

I maintain that CFDs are a good instrument for day trading as stamp duty makes day trading with shares uneconomical. I do not, however, like the way that they are used with high gearing ratios to expose inexperienced investors to losses that they cannot afford.

Voyager2002

What do people think of semi-conductors? A recent BBC programme mentioned two companies that are now struggling to meet demand: Taiwan Semiconductor and the Dutch ASML (who make the capital equipment that is used to manufacture chips). A highly cyclical sector, but one that seems to be on an up-swing right now.

csgohan4

THG is tanking badly, not sure why, but alot of the market is suffering. I'm out at no loss. Looked like a promising company, but 20% gain to 0% is unusual

Also out on INRG, looks like rats leaving a sinking ship imo. Will take my losses as with my gains

What the hell is going on the market today, looks like a massacre

Thrugelmir

csgohan4 said:

What the hell is going on the market today, looks like a massacre

Called a correction. The herd is stampeding for the exits. That's inexperienced investors for you. Panic sets in. When losses become painful.