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Investing/Strategies / Retirement Investing
|Subject: Re: Leveraged investing||Date: 2/28/2011 1:59 PM|
|Author: StockNewb||Number: 68568 of 82344|
Ok Guys, I really did get your points. The general consensus here is Margin is a really sharp knife that if you dont know what your doing you WILL get cut and even if you do you may get cut anyways.
Now yes, I want to play around with Margin and see if it fits me.
But what I see you guys missing is;
Im using funds not stocks. Funds are less volatile then stocks.
I have decided to leverage only about 15-20% of my portfolio. Two reasons the remaining portfolio should act as a gaurantee against margin calls and leveraging 100% is really risky.
I'll be holding a couple funds in the leveraged position instead of just one as I had planned. Due to volatility factors and it is harder to make two funds tank then it is to make one tank.
Right now I want to pick a couple funds that are consistent in there returns i.e large cap funds or very respectable manager's i.e Ned Goodman or both. I dont need to hit a home run, I just want small consistent gains. If I start going for the home run hits thats were I get greedy and potentially lose it all. Right now you guys THINK I'm being stubborn, which I may be, it is a failing of mine. But I am trying to learn and adapt and Margin just seems like an extremely usefull tool.
as per using option's, I like how you can hedge risk with them and it is sorta like leveraging but not quite. I think I may start using them in some positions too. and what I mean by check myself is do my due diligence and have controls in place to where I Can not go against my trading method.
I have no doubts I will get cut by margin either now or later, but I also have no doubts ill get cut by investing period. Everything has a place and time, I figure i'm 25 I dont mind the risk, if i was 40-50 years old it might be another story. I'd rather experiment now and find were my true risk tolerances are then experimenting when im 40 or 50.
anywho I just wanted to make sure my position was clearly defined. I have gotten the general feeling that this board hates margin, thats fine. I intend on using some of it, so now I am on to the advice stage. if you have used margin in the past, tell me what led to your downfall or your stopping of its use. If you do use it tell me how you use it. Vanishing point reference's are great, I loved the movie, I get the point, but I got the point a while back. Now it is time as an investment community to ante up and help the Newb who is I.
I really do appreciate the strong opinion's on Leveraging, but now I feel I should move forward from that. Mayhap in the detailed planning on how I will trade I may decide I don't like it after all. Or maybe I might just use option's instead of leveraging or what not. But I cant know that until I have a plan and looked at the feasibility of it. If I cant make a feasible plan, then it kinda shoots my theories in the foot.
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