TwoCitiesCapital

Crazy that this transaction has resulted in the massive pop over the last two days. Same BIAL that it's always been, but the accounting change allows them to bump up the book value and start charging fees now that book value is above high water mark. If anything, shareholders are WORSE off after the transaction with regard to fees, but that didn't stop the price from ripping 10%.

You don't HAVE to do anything. But yes - investors sitting on a loss, who want to capture the tax value of that loss, have to sell and remain out of the name for 31 days. Tactical investors can take advantage of this - hence, the December/January effect.

It's hard for me to imagine how negative rates are a plus for anyone outside of the govt sector. Negative rates destroy the financial system. For fractional reserve banking systems that then pull back on lending, I'd have to imagine liquidity and credit dry up which will harm the remainder of the real economy. Haven't parsed through European data to see if that's happening yet, but I can't imagine negative rates are a long term positive...

Pushing on a string.

Fingers crossed.

You can buy leveraged investments within the IRA, just not explicit margin at the account level. As has been mentioned, investing in CEFs and buying options is allowed. I believe some places all for futures contracts as well. I don't know how one would invest in a hedge fund via an IRA, but I imagine it's possible.

FMCCJ @ $16

We are actually at a buying point. Similar to Nov 2017 and 3 more instances. Possibly but likely will take a lot more shareholder turnover before any confidence in a bottom. There are plenty of hedge fund holders who probably aren't interested in waiting on the new timeline and/or courts. On this note, I added today. Not a ton - but increased my position by ~ 5% @ $16 for FMCCJ

Held for years. Diluted to Oblivion. Re-upped their capital commitment. Held for more years. And then they reduce right before the real money seems it's going to be made? Seems odd.

I'm a regular participant and see others who are as well

Yes, certainly disappointing. That being said, when I ask myself if anything else in my portfolio is likely to 150+% over the same time period, I generally have to conclude I should be holding the preferred if not adding at this point. Progress has been super slow, but we've moved miles from where we were when Trump was first elected and the question of a release from conservatorship was still a huge uncertainty with most of us still depending on the courts who had a disappointing track record. Now, it seems like that path through admin action is solidifying and becoming more certain by the day and the court cases have given us a break as well. The only question is a matter of timing and I'm ok with that type of uncertainty. Let's not lose the forest for the trees - progress for the last few years has been in the right direction. Don't sweat the day-to-day details unless if they reflect a reversal of that direction.

Only about 5% in true money market, but I have other positions that I view has having similar optionality as hedges 10% in short-term bonds funds 5% in intermediate treasuries 3% in leveraged mortgages (a la NLY) And 0.5% in index out options Also moved 15% out of equities and into IG corporates. Not a true hedge, but probably less volatile to the downside than equities will be.

10-year Treasuries are at 3-month highs. Fairfax trades where it did 3-months ago. It's not a perfect correlation, but I continue to believe that we need to see sustained higher yields before Fairfax can consistently deliver an attractive ROE.

Sure. I don't think Bitcoin as it stands now makes sense for buying a candy bar. But then again, from a store's perspective, neither do credit cards because most of them are losing money on small purchases with their razor thin margins being lost to the processing fees. Just because it doesn't work in 100% of applications doesn't mean it's not a superior system for some, or most, applications. All we're seeing today is the infancy - not the final product/solution. I'm certainly no expert. It's taken me years of watching and reading to get over my initial skepticism to simply accept it as a payment protocol. But the main problems I see with Bitcoin are the transaction fees, which will need to drop, and validation taking minutes. Those don't seem like insurmountable problems - just ones that will take time, and creative solutions, to work through. It's quite possible that Amex/Visa/MasterCard build services on top of Bitcoin to continue to deliver the credit aspect of their business model, to allow for trust in the transaction even before it officially clears, and to allow for block transactions being loaded to the chain instead of each transaction individually which could increase scalability. Point is, that could still be a more advantageous system with lower fees than the 2.5% that is being collected now and retailers wouldn't have to wait weeks for the card companies to remit cash payment to them. Agreed larger transactions likely benefit first and that we're not in a place to supplant traditional payments yet. But I don't see it stopping there and by the time the system is developed, I'd imagine you won't be able to buy an ownership in the payment network (a la Bitcoin) for $9,000.

Central bank "involvement" means "control". If central bankers can issue digital currency, what is the point? I can already use ApplePay to easily and instantly transfer a central-bank inflated currency to buy stuff. The other people who don't want central bank "involvement" are people who don't like letting politicians and bankers steal a portion of all the wealth in society every year through inflation. The entire point of cryptocurrency is not letting that happen. People who actually want central bank "involvement" are missing the entire point altogether. As someone who leans libertarian, I certainly understand the argument, but still tend to agree with SD. It's why I was skeptical of Bitcoin for years and never purchased - because it kept being sold to me as "digital gold" or a replacement of fiat. Both of which I never really saw how Bitcoin could adequately replace. I still don't. But as a payment network that allows for near instantaneous transfers of cash globally...well there's value to that. Ask Visa/MasterCard/American Express. If viewer solely as a payment transfer protocol, I think Bitcoin has immense value regardless of central bank intervention and will eventually reduce the enormous fees that can be charged by payment processing companies as Bitcoin is a direct displacement of their services. But seeing as scalability is the $1,000,000 question when it comes to Bitcoin's mass adoption, we might still see a necessary place for those companies to operate on top of the Bitcoin network to provide trusted transactions so stores don't have to wait 30 minutes to be confident you've paid and so consumers can still spend more than they have.

I'm dead!

Right?!?!??! Where are all the liberal politician to comment on ill-gotten gains here? If I'm Bernie Sanders or Elizabeth Warren or AOC, this a much easier lay-up to tackle than trying to demonize Bezos for bringing thousands of high paying jobs to NYC just because he accepted tax incentives or doesn't pay all of his workers $15/hr.

If I'm an employee, I'm pissed that he leaves a billionaire while the company is on the brink of bankruptcy and my options are worthless. I'm also pissed I didn't get an opportunity to cash out as well

Have been buying & selling over the last 2-3 weeks. Typically 20-30% of the position. When VIX dropped to 15-17 I was buying and selling those same contracts each time it went to 20+. Entire position has basically been paid for in profits at this point and I purchased more today. Sold ~15% of the core put position today when VIX hit 20. Will probably let a bit more go if me move closer to 25, but still waiting for that elusive 30+ print on the VIX to signal panic to let the bulk of the position go. Repurchased these a few days back. Added more today. Still expecting a 30+ VIX move this year, but will keep trading the position. Once again, we've failed to break 3000 sustainably on the S&P and the China trade 'deal' turned out to not really be a deal. Purchased more puts. Was a little concerned this was going to be proven wrong after Monday, but today shows that 3000 appears to be unstoppable resistance. We bounced off it midday just to fall back through it. Increased puts by another 10% today. Rolled covered calls forward on most of my positions.

SRG shares were called as the result of a covered call. Roughly 2% portfolio position. Think it's a good price so rolled proceeds into FCAU, NLY, ZG, and FFXDF - roughly equal amounts into each.

Have been buying & selling over the last 2-3 weeks. Typically 20-30% of the position. When VIX dropped to 15-17 I was buying and selling those same contracts each time it went to 20+. Entire position has basically been paid for in profits at this point and I purchased more today. Sold ~15% of the core put position today when VIX hit 20. Will probably let a bit more go if me move closer to 25, but still waiting for that elusive 30+ print on the VIX to signal panic to let the bulk of the position go. Repurchased these a few days back. Added more today. Still expecting a 30+ VIX move this year, but will keep trading the position. Once again, we've failed to break 3000 sustainably on the S&P and the China trade 'deal' turned out to not really be a deal. Purchased more puts.

Have been buying & selling over the last 2-3 weeks. Typically 20-30% of the position. When VIX dropped to 15-17 I was buying and selling those same contracts each time it went to 20+. Entire position has basically been paid for in profits at this point and I purchased more today. Sold ~15% of the core put position today when VIX hit 20. Will probably let a bit more go if me move closer to 25, but still waiting for that elusive 30+ print on the VIX to signal panic to let the bulk of the position go. Repurchased these a few days back. Added more today. Still expecting a 30+ VIX move this year, but will keep trading the position.

Buy real estate in a crappy location & become a slum lord or pay your fair share of taxes. Decisions, decisions. Seeing as to qualify for the OZ tax relief, you have to spend a pretty big portion of the basis on improvement costs, you seem to misunderstand what 'slum lord' actually means.

I mean, 250k is kind of chump change for him, but at least it's a positive signal. Hopefully results turn around enough for company to be able to repurchase shares sub-$7 and flip them back to Fairfax at $10 with a conversion of debt.

I agree the conversation is moving past each other - position sizing is part of what is being missed, but it's much more than that. 1) the examples people have brought up encompass out, at, and in the money options. All 3 behave differently with different risk/rewards based on moves in the underlying. Same could be said for varying tenures of the contract 2) Further complicating the conversation is loose interpretations of what is being said - like when I say an option isn't a proxy for the underlying, some people are understanding that to mean options are worse than the underlying or that options are bad 3) People are still making the assumption all options contracts are held to maturity in their arguments when one of my very first posts was you may not have that luxury if the thesis on the underlying changes while you hold the contract Everyone is arguing different things, different contracts, and different tenures - different scenarios but still trying to say it's all the same as owning the underlying stock which is only true in a handful of scenarios AND requires you to hold to maturity which is a big assumption IMO.