SharperDingaan

The hard reality is that fundamental analysis as it is usually practised, is not especially productive. Similarly, technical analysis is not especially productive when the intent is swing trades over extended periods. You do well because you are reasonably good at forecasting whether the tide is coming in or out, and act appropriately; there is no place for buy and hold 'forever', whether that be in o/g, or any other commodity. We would all be a lot better off were the Israelis to actually incapacitate some Iranian/Iraqi supply, and the Iranians were to actually incapacitate some Saudi supply. The market 'surplus' would come down significantly, the OPEC+ portion would decline as well, and Russian supply would remain constricted. Brent/WTI would rise by quite a bit, US shale/Cdn heavy would be back in business, lots of jobs, etc. Consumers pay more, and global alternative energy/EV continues to receive a market incentive. Everybody wins; those who swing-trade the opportunity winning even more. Of course, it's not for everybody ...... but recognise that, and you could do very well SD

The reality is that there will be a lot more 'potted' narratives until the US election day; for those so inclined, most would place their 'bets' according to their volume and timing. All that we really know is that the US election is in 5 weeks, it could go either way, and the approach to crypto will probably be quite different depending upon which side prevails. Chinese stimulus effects aren't going to show up for a while, the escalating ME is a significant interim wild-card, and miner holdings/bankruptcy settlement liquidations are continuing. BTC would seem to be a range bound between USD 58-65K until then; not necessarily a bad thing. Lots of ways to play, depending on whether income or appreciation is the aim. Place your bets, step away from the table, and come back after the election; hopefully it pays for a great New Years vacation SD

The BTC-ETF just gets sold off, and the proceeds put into the BTC-ETF options; temporarily pressures BTC down as the BTC-ETF sells off some of its now too large a holding of BTC. Most people are not going to be using these for risk management purposes; longer term they will be used to increase holdings in BTC-ETF, which will push up the demand for BTC. SD

BTC diversification is attractive because of BTCs low correlation to traditional assets. Whereas the problem is two fold; (1) BTC cannot be objectively valued based on cash flow, and (2) the correlations are wildly unstable, hence it's hard to optimise a portfolio when BTC is one of the assets. However, while a BTC valuation based on 'feel' is a hard sell, that BTC volatility can eliminate a lot of cash drag. Employment risk for the outlier. The reality is that BTC's investment use is an evolving process, and will remain so for quite some time. Most would expect that as usage becomes more mainstream, the outlier risk will decline, resulting in a greater BTC capital allocation; raising the value of BTC. Of course in the meantime, if you can act like a PM, and don't have these constraints; good for you SD

You might keep in mind that just because something hasn't happened yet, does not mean that it will not. All that we know is that the science cannot explain the 'missing' hurricanes this season, it is very unusual, and that the science expects fewer/bigger weather events down the pike; weather events also don't have to originate in the Atlantic. There is a reason why most people don't go hiking around mountain tops during stormy weather; they don't want to accidentally get struck by lightning! SD

I hear you! we think of this as analogous to going for a cruise into an expected force 10+ hurricane. Little to do with the boat (FFH as ark), and everything to do with the expected washing machine experience. Q4 is the year's catch-up quarter; hence more volatility than other quarters. If the abnormal hurricane season ends Nov-30, 2 of the 3 months in the quarter are exposed to adverse cat loss. Any kind of significant hurricane in December, flooding in the major East Coast cities, or concern around industry ability to pay is a bonus. Calgary's hail storm losses kicking off the bookings. Lower troughs. 50-75 bp of expected interest rate cuts by year end lifting the market, plus at least one significant election during Q4. Media streams start to post good news real estate experiences. Higher peaks. Last time we swing traded FFH was around the Annual General Meeting, at a price around CAD 1,550; at today's CAD 1,700 we're up CAD 150. Peak to trough difference here could well match/exceed that; if the washing machine produces a CAD 150 delta - it's a 9.5%+ return (150/(1700-150)). Bonus. There's also the benefit that were 50% of an existing FFH position sold at CAD 1,700; the remaining position would be hedged at CAD 1,700. Not a bad thing. SD

Just dropping in ... What are the thoughts around the coming weather related cat losses as we go into hurricane season? The ask is because interest rates are dropping (inflation at 2%) raising the tide for all, and FFH traditionally has Q4 seasonal exposure to weather related cat losses. Seems to be a pending opportune swing trade; particularly if enough of the insured US East Coast floods out to stress the industry ability to pay out. Hopefully we're not trying to buy back, at the same time that FFH is trying to buy in more of their now cheap stock SD

SBF was just another savant, with zero/no ability to empathise with others; same as many a sociopath. https://ca.search.yahoo.com/search?fr=mcafee&type=E210CA1494G0&p=savant+definition SD

The Politico article focused on German energy policy ... expressing woe is me for the next 2-3 quarters; really? It's Germany folks ... lost 2 WW's, and after each truly devastating loss, came back a whole lot stronger than it was before. Yes it wasn't fun, but there are few other places in the world as good at recovery as Germany; and Germany does it very, very well. Drop another 1/3 to 1/2 in price, and both BASF and Thyssenkrupp are solid long-term holds; probability of getting there before everything is done? fairly high. Not that long ago, CS blew up, and got forced into UBS; driving UBS to modern time lows. Today UBS is near twice the price it was, and materially stronger than in was pre CS merger. While disruption will not be great for BASF/Thyssenkrupp employees, and the thousands reliant upon those ongoing pay-cheques; similar post-disruption gains .... are not unreasonable. Diversification is also the difference between living in a place (US), and just investing in it (Europe/Asia). Long way from being 'uninvestable'. SD

Amusing thread! One invests in Europe for the portfolio diversification; the more different Europe is vs the US or Asia, the better. If it's not your thing, simply walk away. Diversify by either residing in Europe and investing primarily in the US or Asia; or residing in the US or Asia and doing some investment in Europe. Choose between stocks and bonds, or direct ownership of real estate; each has its own set of risks. Europe is multiple countries, all with different political/economic priorities and economic realities; accept the sandbox for what it is, or go elsewhere. For the most part there are solid pockets of opportunity within each country; it's just a different shade of green. The reality is that Europe is fighting a war on its patch (Ukraine), is caught in a tariff war (US/China), is ramping up defence spending to 2%+ of GNP, and experiencing rising extremism; it isn't looking good. There aren't going to be any 'break-ups', but there is going to be significant economic disruption; see it as either an opportunity or threat, and act accordingly. While the value of USD/EURO/YUAN will change according to the political manipulation of the day, nothing prevents you from storing your accumulating value in Gold/BTC etc. Fiat currencies progressively devalue, whereas Gold/BTC doesn't; BTC also has the advantage of better portability. SD

It's very much a generational thing, and which immigrant generation you are; once it becomes your generations 'norm', nobody really questions the why any more. However, as the various generations move through life; norms and approaches change. For many newer retirees, it's a lot logistically/financially smarter to simply AirBnB vs own a cottage/home in a 2nd country. It's also a lot smarter to spend time with cousins/family who remained in the home country, refreshing family links that grand-kids might use later. As you also aren't tied to any one spot ... you can also travel around a bit. The approach radically changes things. Fly vs drive to the destination and the game changers are flight times/lay-over location, not the cost (assumes extended time in XYZ at living costs that are a lot lower than in Florida). Sure, not everyone can still fly ... but if that's you; you also aren't stuck with the operating costs of that 2nd cottage/home in Florida that you aren't using. Live in Toronto ? fly/cruise to Argentina/Chile/South Africa/Australia/NZ in November, stay there for 5 months and come home; enjoy endless summer while keeping your Canadian health care. Similarly fly/cruise to an India/Asia for 5 months and enjoy time with the extended family of your generation. Live in Vancouver? use Lima (Peru) as your gateway to S America, and LA as your gateway to Sydney. Different strokes. Nothing wrong with Florida, but in today's world there are many other options, and many that are better. Florida tourism isn't likely to suffer for a while, but all good things eventually come to an end. SD

Retired Ontario/Quebec/Atlantic snowbirds winter in Florida for the climate, and have done so for decades. Back in the day it was cheap, a built-in road trip getting to/from, and your CAD went further than it does today. In 2020, it is much more common to winter in the southern hemisphere (where its summer) vs Florida, and depending where you go - your CAD will go many times further. For those who can afford it, it is now also much more common to winter in an Asia while having a hip/joint replaced. In 2013 an estimated 20M US people lived in mobile homes, and quite a few of those people weren't poor. Some of these mobile homes can go up to 2600 square feet and cost as much as a small house. It is no longer the 'stigma' that it once was, we have a quite a few friends in both California and Texas who have done this, and all have cited it as the down-sizing solution. You would freeze your ass off up here, but if you live in the right climate ... power to you. https://www.bbc.com/news/magazine-24135022 https://www.mhvillage.com/floorplans Small cars do very well in Europe because they fit the streets, are very nimble, easy to park, cheaper to operate, and are reliable high-tech. Most driving is city runabout picking up groceries, dropping the kids off, etc. The US drives big cars because that's the marketing; sell enough of them and a big car costs less than a small one to produce. I hear you on the tech divide, but this is 2024 and technology is part of our modern life. Your smart phone is your access to services ... and if you refuse to/can't use it, that's on you. If you a have a stroke tomorrow, and are incapacitated, that smart phone could automatically make the right calls; and save both your life, and your mobility. SD

The expectation is that you live (in Canada) where your money comes from (Canada). However, nothing prevents you from receiving Canadian income while living like a king elsewhere (South Africa, Caribbean, South America, etc.) for part of the year. Thousands of snowbirds live in Florida every winter, at CAD 1.35/USD 1.00. However, live in South Africa every winter; and it's ZAR 13/CAD 1.00, plus your same spend goes 2-3x further ... even at tourist prices. At 70+ the kids have grown up and either fled the house (nobody wants to live with gran/grandpa) or been forcibly fledged (lower food/utility bills). You are also running down the property, as you intend to sell it vs keep it (minimal upkeep). A common US practice is to sell the home and live in a very high end trailer, in a trailer park; abandoning the trailer when its time for a home. That banger in the driveway is smaller (mini, fiat, smart-car, etc.), paid off (no lease, monthly debt payment), but older and perfectly good ... if you can still drive/park it. For most city dwellers at 70+ the 'road-trip' is now the Sunday afternoon drive and dinner 'out' (lower transport and entertainment costs). How many 'old people' do you see gaming? making good use of a smart phone?, or making use of computer/device streaming subscriptions ? Not very many, and most have to have someone set it up for them (lower telecom). How often do you see 'old people' travelling, and when? it mostly depends on where (Europe) and how (Ship/Train/Coach). There's a lot of joint travel in the go-go years... then a temporary bump when grandma goes cruising/coaching with 'the girls' after grandpa croaks out. Lower travel costs the older you get. Canadian healthcare will keep you alive and housed until death; but sure - you may not like the wait times, the choice of drugs, or the accommodation in your final 'home'. While wealth has privilege, and can allow you to skip lines, access better drugs/treatment, live in a better place, and possible even live a year or two longer (Toronto vs Newfoundland); does it really matter at the end - if you are not in pain, but have advanced dementia &/or advanced MS, are permanently housebound, and essentially a cabbage? MAID exists for a reason. Point here is that gifting to the kids isn't part of it. The kids benefit after you croak, not before; and nothing prevents you from owning part of their houses until then. You want grand-kids? lower the cost of raising them (by reducing your kids monthly mortgage payment). You want to set up those grand-kids for life? will your equity stake in the parental house to them. While in the meantime .... retaining full control of the money should there be a divorce. Not what many want to hear. SD

If you live mortgage free, have no debt (car, carried visa balance, etc.), have a spouse, and are healthy; WTF do you need a 74K/yr+ annual income for? You AND your spouse COMBINED will be hauling in 100K/yr+ ... and this isn't enough? Millions of working couples every year earn a lot less than that, and endure daily expenses that are a lot higher. If you continued to work until age 70, you may have an OAS of around 900/mo ( $10,800/yr). On the next 72K (10,800/.15) of income above 74K you will pay an additional 15% in addition to your 32% marginal tax rate (Ontario) - or 47%+. Nobody who is retired wants to be paying 47%+, hence the obsession. Different POV. SD

Canadian reality checks .... 4% withdrawal rate. The latest that an RRSP holder can start withdrawing is on his/her 72nd birthday, and the minimum withdrawal is 5.40%. Goes up every year after that to 20%/yr when you're 95 or older, and it doesn't matter whether your portfolio is 100% equities, or 100% bonds. https://www.woodgundy.cibc.com/en/reference/retirement-planning/rrif-minimum-withdrawal.html Upon retirement most people will receive a retirement income consisting of some combination of private pension, CPP, OAS, GIS, interest/dividends, and a minimum RRSP withdrawal. Above $17,076 of total income/yr, GIS is clawed back at 50c in the incremental dollar. Above $74,000 of total income/yr, OAS is clawed back at 15c in the incremental dollar. If you delay retirement until age 71, you might have $2,800/mo (33.6K/yr) in CPP and OAS. Assume $0 in taxable interest/dividends; if your RRSP is > $735K, your OAS is getting clawed back .... and if you suddenly need more money, the OAS claws back even faster. But .... if you had also had 10K in taxable interest/dividends, your OAS would get clawed back were the RRSP only > $553K. But this is the COBF board! ...... what if you had been diligent, had invested 'wisely' over the years, and at age 71 your RRSP portfolio was $2M? You would pretty much be f***** ! as your minimum RRSP withdrawal would be 108K/yr and rising every year - ensuring that your entire OAS was clawed back every year. Oops! The takeaway here ? ..... throughout your investing life, systematically, and periodically, take $ off the table. SD

There is a very simple test for this ...... cdn example TFSA: The 2024 LTD maximum contribution is 95K, inclusive of a 7K 2024 contribution. TFSA contributions/withdrawals are tax-free, and there is no tax on gains/dividends earned while the money is in the TFSA (ie: zero tax impact). If your total TFSA investment earns 7K/yr in dividends; would you also make the 7K 2024 TFSA contribution ? Would your answer change if you had invested 'wisely' , the TFSA had 250K in it, and now earned 18.75K/yr in dividends (7.5% cash yield) before trading gains/losses. https://www.wealthsimple.com/en-ca/learn/tfsa-limit If the answer is that you would stop contributing to the TFSA ... continue working; as the TFSA is now self-financing ... enjoy yourself and spend that foregone TFSA contribution on additional/better vacation. Those near retirement might do the same analysis on their RRSP, and spend the foregone RRSP contribution on house renovation/upgrades prior to retiring. When the numbers are small .... quitting your job to go full-time into investing is a pretty dumb idea SD

Ever the heretic .... most people would be a lot better off if they weren't full time investors! For the same level of risk; subtract today's yield, from the yield you expect to average (rolling 5-7 yr), multiply by your capital, and divide by the additional hours that you expect to put into this. Most people would do better had they simply worked those additional hours for minimum wage at McDonald's - and would have incurred no additional risk. Sure, it might work if you have a few million to play with .... but that isn't most people! Most people in 'real life' do lots of different things, and are far better off because they do so. Investment is simply glorified money management; your money works for you - not the other way around! Most people also invest to improve their future standard of living (get an education, live mortgage free, etc.); and hence systematically take gains off the table to make it happen. Life is much better with a more modest investment account, less stress, and a large number of good friends/family; than with a huge account, plus the associated stress, and few if any friends/family to enjoy it with. Not what the investment industry preaches, or what many would prefer to hear! SD

I hear you ... but that nation wide general strike (and likely repeats) says otherwise. Hundreds of thousands of the civilian workforce, many of which with various connections to the IDF; all saying take the cease-fire and release the hostages; even the IDF leadership saying take the cease-fire. And now there are trails evidencing that the political stalling is getting those hostages killed. The warlords may feel threatened, but change is coming; whether they want it or not. SD

The coalition falls tomorrow, there are elections, new leadership, and an end to the war; oil prices drop like a brick. To your point ... keep doing the same things over and over, and there very likely will be more wars. So one has to try something different; best case it results in something better, worst case it defaults back to today's outcomes. But there is no possibility of a better outcome unless one attempts it. Every time there is another war, it is a roll of the dice. Even if you consistently have the mightiest armies, best intelligence services, tightest grip on your people, etc ... keep rolling the dice ... and eventually the dice will roll against you. Nobody is omnipotent forever. Israel is a small country, fighting a war, and burning resources at an incredible rate; rolling general strikes will quickly bring Israel to its knees, forcing change. That change can either come the revolutionary way, or the civilised way - but it will come. SD

What is the view now that there are nation wide general strikes in Israel? Sure it's no big deal to legally ban today's strike; but nothing prevents a new strike tomorrow, and the more days of strike, and the more times strikes are banned ... the more unstable the coalition wobbles. The Ukraine had the Orange Revolution ... and it ultimately changed the world; have to think that something similar is at risk here. https://www.aljazeera.com/gallery/2024/9/2/israelis-strike-for-gaza-deal-after-more-captives-found-dead https://www.yahoo.com/news/israeli-labor-court-orders-strike-163640648.html?fr=sycsrp_catchall https://en.wikipedia.org/wiki/Orange_Revolution It would seem that the issues are being forced to a head, one way or another; and by the US election date. No dog in this (other than the direction of oil prices), but one has to think that it's past time to give peace a chance. SD

Interesting reading .... but a couple of caveats. This is just the <5% of successes in both business, and succession; most of that other 95% will have had very different experiences. It is also a very different thing when you're a private vs a public company; as nobody regrets getting out of public reporting and its short-term mindset. Then keep in mind the colourful 5-10% that are very good at what they do; but habitually just happen to be on the wrong side of the law ... lot of generational businesses in there! Personalities also have a lot to do with it. SD

The takeaway from all this .... is evolution. Getting comfortable with being both 'buy and hold' (long core position) and short (flex, swing-trade, etc.) - on the same stock, and at the same time; and often on many of the same companies! (we prefer to do FFH around dividend time). It's not giving up on a thesis, it's merely using your accumulated knowledge/experience (alpha). Recognising that you can't swing for the fences until you have both ongoing liquidity (T-Bills &/or marginable stock > USD 10) and reliable diminished cash outflows. Then recognising that when you do swing at a junior, you need to have at least a 100,000+ shares at < 1.00 if the risk is to produce a meaningful result. Most have this backwards. Recognising that AUM is purely a wealth managers compensation metric. Most people just want to be able to eventually reliably retire comfortably; AUM primarily exist to be used, not to contribute to someone else's compensation. Realising that the tax tail shouldn't wag the dog. Take the gain today, pay the tax, pay down some mortgage .... versus risk losing it altogether and/or suffering a benefits claw-back later (for the rest of your life) 'cause your taxable income is now too high. Takes a while to learn! SD

Yes it's the GSIB bank. Not a popular choice, but with the forced merger of CS, and the Basel related guarantees of ALL Central Banks, it's pretty hard to see it as anything else. At the current price it's still less than double what it was in March 2023 (CS merge), the Swiss Central Bank isn't going to be accepting of anything less than a 'Swiss Finish', and we would have no difficulty exiting at market price. SD

We periodically pull capital out of the equity portfolio to keep it within our tolerance (forced sale), and park the funds in T-Bills/Canada's/BTC/UBS for a time before ultimately repatriating some of the capital. Creates an always-on-call marginable liquidity cushion should we need it. We can also 'sidecar' the equity portfolio as we need to, via 're-assignment'. We treat BTC/UBS as cash equivalents which a lot of others wouldn't do .... a privilege that comes with managing your own funds vs OPM. SD

No worries! it's just a different approach. We systematically take $ off the table, because we invest in oil/gas (high volatility) ... and forever have the well-known bumper sticker branded on our ass ... “Please God, give me one more oil boom. I promise not to piss it all away next time.” Obsidian being a very good example! Truly despised back in the day (and still is), OBE was < CAD 30c (post 7:1 consolidation) at one point, run by idiots ... and you couldn't spit/sh1t it far enough! But .... good bones can carry a lot of sh1te; and despite managements (& the markets) best efforts, OBE refused to die. We had progressively swing traded down, eventually ending up with a huge position (and a lot of capital 'at risk') that would buy us a house (mortgage free) if it worked out, and were ridiculed! Fast forward; it has worked out very well, we have a nice house mortgage free, and 40% of the original position left - now entirely funded with house money. Were OBE to go to zero tomorrow we've still won. However, we continue to hold 'cause we're pretty sure that isn't going to happen. Future promise is always alluring, but how much is it actually worth today? We use a 35% discount rate, and on concentrated positions ... prefer to reduce our 'at risk' capital to manageable levels as soon as practical. Sure we give up opportunity ... but when you will still be up millions, it really doesn't matter; and is a small price to pay for a sound sleep every night. Wouldn't do this with a BRK; but I'd be an idiot not to .... were I investing in a highly volatile BTC-ETF. Different strokes. SD