Discussion ***Official*** 2025 Stock Market Thread 💰

[FelixDeCat]

Just looked at the all-time graph. Down -99.37%.

The funny thing with Hoth is that shorts got screwed too. They announced today no plans to dilute share holders by raising capital for now.

 

[FelixDeCat]

Market volatility picking up.

 

[JTsyo]

Market volatility picking up.

I was thinking trading VIX but seems like it's a daily trade kind of thing. My thought was to buy below 20 and then set a limit sell at 30.

 

[dullard]

I was thinking trading VIX but seems like it's a daily trade kind of thing. My thought was to buy below 20 and then set a limit sell at 30.

That wouldn't trigger very often. That combination only occurred once in 2024 and not at all in 2023. Plus, you already missed the boat, VIX is above 20.

 

[repoman0]

I’m a (continued) buyer of medium term treasuries as they get close to 5% again, especially in my tax advantaged accounts.

 

[dullard]

I’m a (continued) buyer of medium term treasuries as they get close to 5% again, especially in my tax advantaged accounts.

Silly question, since I should know the answer. But what do you think is the best way to buy treasuries? I've glanced at TreasuriesDirect.gov before and just get lost in such a vast array of so many very similar looking options and wait periods for auctions. Or there is the hassle of buying them on the secondary market with varying maturities and coupons. So, I give up, get a CD with about the same rate/term and am done. That works well with CDs paying decently (which to me is minimum 5%), but at the moment, you can't find any CD in the 5%+ range.

 

[repoman0]

Silly question, since I should know the answer. But what do you think is the best way to buy treasuries? I've glanced at TreasuriesDirect.gov before and just get lost in such a vast array of so many very similar looking options and wait periods for auctions. Or there is the hassle of buying them on the secondary market with varying maturities and coupons. So, I give up, get a CD with about the same rate/term and am done. That works well with CDs paying decently (which to me is minimum 5%), but at the moment, you can't find any CD in the 5%+ range.

I’ve done the treasurydirect thing and still have some leftover holdings there — it’s less complicated than you think but is still a pretty terrible site to navigate. Now I default to buying chunks of VGIT when yields go up (which sends the price of the ETF down). My understanding is that if you hold the ETF for the average maturity time, it should be pretty much equivalent.

edit: that includes not having to pay state income tax on interest payments — the 1099 that you get will have it broken down correctly

 

[Brainonska511]

Silly question, since I should know the answer. But what do you think is the best way to buy treasuries? I've glanced at TreasuriesDirect.gov before and just get lost in such a vast array of so many very similar looking options and wait periods for auctions. Or there is the hassle of buying them on the secondary market with varying maturities and coupons. So, I give up, get a CD with about the same rate/term and am done. That works well with CDs paying decently (which to me is minimum 5%), but at the moment, you can't find any CD in the 5%+ range.

I had used TreasuryDirect for t-bills in the past, but then I switched to just buying them via auction on Vanguard.

But now for T-bills, I've just given up on purchasing them altogether and just opened up VUSXX mutual funds to handle that. I think if I wanted intermediate or long-term government bonds, I'd look towards a Vanguard bond fund. It may not provide immediate exposure to the latest bonds (as if you bought one specific one at auction), but it would capture the changing nature of those markets.

 

[JTsyo]

That wouldn't trigger very often. That combination only occurred once in 2024 and not at all in 2023. Plus, you already missed the boat, VIX is above 20.

Yea, I've figured VIX trading is too much of a micro-management strategy.

 

[Indus]

Been researching more ETF's and came across this..

Am I the only one who finds this overly complicated?

 

[FelixDeCat]

Been researching more ETF's and came across this..

Am I the only one who finds this overly complicated?

Option income ETFs.

These things are pretty volatile and depend on the stock price either remaining relatively stable within a range or going up gradually. As he mentioned at 14:50 these funds held over a longer period lost money (less than $100,000 invested over time):



In 2023 I owned $15,000 of TSLY, collected 1 month of dividends and the share price then continued its downward spiral. I bought 1000 shares at 15, collected about 50 cents and dumped them about $14.00. I also had to pay income tax on that 50 cents.

Because TSLA contined spiraling downwards at the time, TSLY eventually fell under $5.00 per share. Finally they reverse split, so instead of 1000 shares I would now have 500 shares (had I held). Reverse splits are very bad if you go through one.

TSLY share price never recovered in comparison to TSLA rise because their gains are capped due to covered calls.

For the single stock ETFs, if any go through rapid share price declines like TSLA does often, that really is bad for any of these. A black swan in the market will also be pretty bad since all these are leveraged bets.

I suspect TSLY may reverse split again one day if it goes back under $5.. But I guess if you dont mind these risks and spread some money over many of them, maybe you will do ok, but you there is also tax to consider.

I am not crazy about the idea over all.

 

[Indus]

I know VOO is a favorite of many here..

But I've been looking at cheaper expense ratios..

SPLG 0.02

& BKLC 0.00%

Anyone like BKLC?

Opinions if you just want to invest and hold onto that for 20-30 years?

 

[Brainonska511]

Seems that some things are trending downward over the last month. Some ETFs I set up somewhat low limit orders for are executing. No big deal though, since it's in for the long haul.

 

[dullard]

I know VOO is a favorite of many here..

But I've been looking at cheaper expense ratios..

SPLG 0.02

& BKLC 0.00%

Anyone like BKLC?

Opinions if you just want to invest and hold onto that for 20-30 years?

Vanguard started the low fee trend, but they certainly didn't create the lowest fees possible. So, there is value in at least considering alternatives. I own funds very similar to VOO and SPLG (I do mutual funds instead of exchange traded funds since I don't watch the stock market closely during the day to try and time something exactly). Their VOO and SPLG returns are identical and I have no complaints with either one.

But honestly, in this case there really isn't that much different in going for a lower fee. Suppose you had $100,000 invested, the VOO fee is only $30/year so the slightly lower $20/year fee for SPLG just doesn't move the needle. You have bigger things to worry about than $10 when you are investing $100,000.

I haven't tried BKLC. Looks like they make their money from add-on services and doing things like lending their shares out for shorts. Seems like the return is the same as VOO and SPLG. Just check what their trading fee is. I didn't look closely but it looked like $8.95/trade + $0.01/share. That quickly eats into the $30 you save from VOO fees in the example above if you trade much.

 

[Brainonska511]

I do mutual funds instead of exchange traded funds since I don't watch the stock market closely during the day to try and time something exactly

This has largely been how I've purchased funds. The only ETFs I have are two semi-broad market US and International ESG style funds in Vanguard, because they aren't really offered as a mutual fund. For most of those purchases, I just set a limit order of what I consider a satisfactory price instead of trying to perfectly time a market order.

(Relatedly, I know ESG funds aren't perfect and everyone may have different standards for ESG, but I figured I'd put a little bit of my money where my mouth is and at least have some money invested in funds that also don't hold things like "prison industrial complex" or tobacco company stock. [And the returns closely mirror the non-ESG variants])

 

[Indus]

This has largely been how I've purchased funds. The only ETFs I have are two semi-broad market US and International ESG style funds in Vanguard, because they aren't really offered as a mutual fund. For most of those purchases, I just set a limit order of what I consider a satisfactory price instead of trying to perfectly time a market order.

(Relatedly, I know ESG funds aren't perfect and everyone may have different standards for ESG, but I figured I'd put a little bit of my money where my mouth is and at least have some money invested in funds that also don't hold things like "prison industrial complex" or tobacco company stock. [And the returns closely mirror the non-ESG variants])

Mostly I'm just afraid of a large capital gains bill from a non sale (i.e. them rebalancing something to keep it true to tracking the S&P 500).. that's why I was thinking about going ETF's since stocks are non taxable till sale.

But if the difference is minor even for large amounts.. I might just go with the index fund itself.

Which one do you go with? VTSAX or FXAIX or something else?

I kinda like the Fidelity 0.015% expense ratio.

 

[Brainonska511]

Mostly I'm just afraid of a large capital gains bill from a non sale (i.e. them rebalancing something to keep it true to tracking the S&P 500).. that's why I was thinking about going ETF's since stocks are non taxable till sale.

But if the difference is minor even for large amounts.. I might just go with the index fund itself.

Which one do you go with? VTSAX or FXAIX or something else?

I kinda like the Fidelity 0.015% expense ratio.

There isnt much of a difference between ETF and mutual funds when it comes to capital gains: both have no capital gains until they are sold. A handful of funds sometimes generate capital gains that get distributed to shareholders, but it's not a routine issue.

And you shouldn't have to worry to much about rebalancing if you're invested in a fund. In a taxable account, you can use dividends and general contributions to keep your investments in balance without selling assets.

 

[Red Squirrel]

If you use a TFSA you can also get around capital gains altogether. I'm not sure what happens if your investment happens to skyrocket beyond the contribution limit though, ex: is the contribution limit only for what you initially put in, or for what it grows to. The limit is cumulative over the years though so I'm not too worried. I think I have like over 50 grand of room now. Never going to hit that.

 

[dullard]

If you use a TFSA you can also get around capital gains altogether. I'm not sure what happens if your investment happens to skyrocket beyond the contribution limit though, ex: is the contribution limit only for what you initially put in, or for what it grows to. The limit is cumulative over the years though so I'm not too worried. I think I have like over 50 grand of room now. Never going to hit that.

The TFSA is for Canadians only. After a quick search it looks like the Canadian System is similar to the US system: you have contribution limits, but no earnings limit from your contributions. For example, you can contribute $7,000 in 2025--no one but you cares how much that grows to become. Whether you gain big, lose big, or somewhere in between you can then contribute to the contribution room limit for 2026.

Your point is correct: it is generally* best to put things into tax free or tax deferred investments first. Then capital gains tax isn't something to be concerned with.

* There can be some exceptions if you have other tax savings from other types of retirement plans.

 

[dullard]

There isnt much of a difference between ETF and mutual funds when it comes to capital gains: both have no capital gains until they are sold. A handful of funds sometimes generate capital gains that get distributed to shareholders, but it's not a routine issue.

And you shouldn't have to worry to much about rebalancing if you're invested in a fund. In a taxable account, you can use dividends and general contributions to keep your investments in balance without selling assets.

I generally think that you and I are alike. Here I disagree a bit.

It is routine for mutual funds to make distributions. Heck, it is required by US law that mutual funds distribute all profits from purchases/sales by the fund managers at least once per year. ETFs don't have that law forcing distributions. So, there is a key difference between ETFs and mutual funds. But, for an S&P500 tracking fund, the difference is minimal. The mutual fund managers of S&P500 tracking funds should not be selling very much (it is a passive tracking fund after all). That is because they don't have to sell to match the S&P500. They only have to sell if there is a large outflow from the fund (and that probably doesn't occur when the fund is having a positive year that would generate capital gains that year) or if there are companies removed from the S&P500 list.

That said, the capital gains shouldn't be the primary decision point. Spend time buying the right funds. Don't waste too many brain cells trying to determine the optimum tax efficiency route. Spend those brain cells to get a profit instead. Tax should be only a secondary concern because without a profit, there is basically no tax to pay. Plus, capital gains taxes are pretty low anyways. Stick to tax managed funds or S&P tracking funds if capital gains tax is a big concern for you.

 

[repoman0]

I chose today to dump 2/3 of my remaining VGSH for the longer dated VGIT treasury fund. Also did my $14k worth of backdoor Roth IRAs into VGIT on Friday.

Still haven’t moved the needle at 85% stock allocation even though all my new money has been going into treasury bonds for a while

 

[dasherHampton]

With AI down to a little over 30 I'm starting to consider throwing down some 30 puts.

My chart showed earlier today I can get about $1000 for 5 (2/21). I haven't sold much lately.

Forgot to add - AI reports on 2/26. Wouldn't want to go beyond that.

 

[Indus]

BTW I don't understand two things about TREASURY etf's. So forgive me for asking..

If they're made up of treasury bonds.. why do they fall sharply in price like a stock? Isn't the return constant?? Like look here..



I could have lost 50%if I had invested in that dark blue one in 2020.

And second.. how come some have high expense ratios? Wouldn't it be smarter to just go to treasury direct and get the treasury bonds yourself rather than get a treasury ETF?

 

[repoman0]

If you bought the underlying 30 year treasury bond in 2020 that makes up the assets of that ETF, you lost the same amount of money. Thats because it was paying 2% or whatever at the time, if that, and if you go sell it on the secondary market someone will pay about 65% of face value. Thats because they can go out and buy a fresh 30 year paying 5%. The prices move such that if you hold the ETF for its average maturity, you get your money back plus whatever the annual yield was when you bought it, same as if you bought the underlying paper. The actual bond continues to pay you your 2% but the ETF lowers in price by 40% and now pays you 5% — the same amount of money every month.

IMO the 30 year isn’t worth it over the 7-10 year range. I can handle being locked in to 7-10 years at 5% and possibly watching paper losses in the meantime if yields rise. But being stuck with it for 30 years for an extra 0.2%? No thanks

 

[dullard]

BTW I don't understand two things about TREASURY etf's. So forgive me for asking..

If they're made up of treasury bonds.. why do they fall sharply in price like a stock? Isn't the return constant?? Like look here..

Bond funds (treasuries, or agencies, or similar groups of loans) should not be confused with single bonds (treasuries, agencies, or similar single loans).

With a single bond, there is a known term and a known interest payment. I'll ignore the complication that the bond isn't paid off to make the discussion more simple. Suppose you bought a 10-year bond that pays 2%/year. Then in 10 years you'll have 1.22 X (your investment). It is guaranteed to return more than what you put in if you wait that full 10 years (again ignoring the complication of a default on that bond).

But, as Repoman0 pointed out above, there is an alternative ending to the paragraph above. What if you don't wait the full 10 years? Well then, all bets are off. No one in their right mind right now would want to buy that 10-year bond from you at 2% yield--at least not at full price. Anyone could go right now to buy a treasury that has a 4.2% to 4.8% yield (depending on the term). So why on Earth would they buy your terrible bond just paying 2%? They'd only do it if you give them a discount. You must sell your bond for less than face value (often for less than what you put into it). Selling the bond early to get out of it is what loses money.

Similarly, theoretically new bonds could drop to below your 2% bond (lets say bond yields hit 1%). If that ever happened in the next 10 years, then people will be clamoring for your 2% yield in a safe bond rather than just 1%. They would pay you more than face value for your bond. Selling the bond early is what gains you money in this case.

What is a bond fund? A bunch of bonds that are continually traded. They either go up in value (if interest rates drop) or go down in value (if interest rates go down). Sure, they will pay the interest to whomever has them. But there is the added gain/loss depending on how people think interest rates will move in the future.

I personally don't like bond funds for that reason. Bonds are supposed to be your stable base so that you get a guaranteed return. But, now the bond fund throws in the gambling aspect of the unknown future into that equation. A lot of advisors say to only buy short term bond funds for that reason, they are unlikely to lose much because interest rates rarely change a lot in that short time frame.