Currency Trading Account India, Meaning, Requirements ...
Initial Margin Requirement - My Trading Skills
The Great Unwinding: Why WSB Will Keep Losing Their Tendies
I. The Death of Modern Portfolio Theory, The Loss of Risk Parity, & The Liquidity Crunch SPY 1 Y1 Day Modern portfolio theory has been based on the foundational idea for the past 3 decades that both equities and bonds are inversely correlated. However, as some people have realized, both stocks and bonds are both increasing in value and decreasing in value at the same time. This approach to investing is used pretty much in everyone's 401K, target date retirement plans, or other forms of passive investing. If both bonds and equities are losing value, what will happen to firms implementing these strategies on a more generalized basis known as risk-parity? Firms such as Bridgewater, Bluecrest, and H2O assets have been blowing up. [2,3] Liquidity has been drying up in the markets for the past two weeks. The liquidity crisis has been in the making since the 2008 financial crisis, after the passage of Dodd-Frank and Basel III. Regulations intended to regulate the financial industry have instead created the one of the largest backstops to Fed intervention as the Fed tried to pump liquidity into the market through repo operations. What is a repo?
A repo is a secured loan contract that is collateralized by a security. A repo transaction facilitates the sale and future repurchase of the security that serves as collateral between the two parties: (1) the borrower who owns a security and seeks cash and (2) the lender who receives the security as collateral when lending the cash. The cash borrower sells securities to the cash lender with the agreement to repurchase them at the maturity date. Over the course of the transaction, the cash borrower retains the ownership of the security. On the maturity date, the borrower returns the cash with interest to the lender and the collateral is returned from the lender to the borrower.
Banks like Bank of New York Mellon and JP Morgan Chase act as a clearing bank to provide this liquidity to other lenders through a triparty agreement. In short, existing regulations make it unfavorable to take on additional repos due to capital reserve requirement ratios, creating a liquidity crunch.[7,8,9] What has the Fed done to address this in light of these facts?
In light of the shift to an ample reserves regime, the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period.
II. Signs of Exhaustion & The Upcoming Bounce is a Trap, We Have Far More to Go A simple indicator to use is the relative strength index (RSI) that a lot of WSB is familiar with. RSI is not the be all and end all. There's tons of indicators that also are indicating we are at a very oversold point. SPY 1 Y1 Day RSI Given selling waves, there are areas of key support and resistance. For reference, I have not changed key lines since my original charts except for the colors. You can check in my previous posts. 247.94 has been critically an area that has been contested many times, as seen in the figure below. For those that bought calls during the witching day, RIP my fellow autists. The rejection of 247.94 and the continued selling below 233.86 signals to me more downside, albeit, it's getting exhausted. Thus, I expect the next area in which we start rallying is 213. SPY 10 Day/30 min Another contrarian indicator for buying calls is that notable people in finance have also closed their shorts. These include Jeffery Gundlach, Kevin Muir, and Raoul Pal.[11,12,13] III. The Dollar, Gold, and Oil As previously stated, cash is being hoarded by not only primary banks, but central banks around the world. This in turn has created a boom in the dollar's strength, despite limitless injections of cash (if you think 1 trillion of Repo is the ceiling, think again) by the Fed. DXY Despite being in a deflationary environment, the DXY has not achieved such levels since 2003. Given the dollar shortage around the world, it is not inconceivable that we reach levels of around 105-107. For disclosure, I have taken a long position in UUP. However, with all parabolic moves, they end in a large drop. To summarize, the Fed needs to take action on its own currency due to the havoc it's causing globally, and will need to crush the value of the dollar, which will likely coincide with the time that we near 180. If we are indeed headed towards 180, then gold will keep selling off. WSB literally screams bloody guhhhhhh when gold sells off. However, gold has been having an amazing run and has broken out of its long term channel. In times of distress and with margin calls, heavy selling of equities selling off of gold in order to raise cash. As previously noted, in this deflationary environment, everything is selling off from stocks, to bonds, to gold. /GC Futures Contracts 5 Y1 Wk What about oil? Given the fall out of the risk parity structure, I'm no longer using TLT inflows/outflows as an indicator. I've realized that energy is the economy. Closely following commodities such as light crude which follow supply and demand more closely have provided a much better leading indicator as to what will happen in equities. Given that, oil will also most likely hit a relief rally. But ultimately, we have seen it reach as low $19/barrel during intraday trading. /CL Futures Contracts 1 Y1 D IV. The Next 5 Years In short, the recovery from this deflationary environment will take years to recover from. The trend down will not be without large bumps. We cannot compare this on the scale of the 2008 financial crisis. This is on the order of 1929. Once we hit near 180, the Fed crushes the dollar, we are in a high likelihood of hitting increased inflation, or stagflation. At this point the Fed will be backed into a corner and forced to raise rates. My targets for gold are around 1250-1300. It may possibly go near to 1000. Oil could conceivably go as low as $15-17/barrel, so don't go all in on the recovery bounce. No matter what, the current rise in gold will be a trap. The continued selling in the S&P is a trap, will bounce, forming another trap, before continuing our painful downtrend. I haven't even mentioned coronavirus and unemployment until now. I've stated previously we are on track to hit around at least 10,000 coronavirus cases by the end of this month. It's looking closer to now 20-30,000. Next month we are looking to at least 100,000 by the end of the April. We might hit 1,000,000 by May or June. Comparison of the 2020 Decline to 1929 ------------------------------------------------------------------------------------------------------------------------------------------------ Chart courtesy of Moon_buzz tl;dr We're going to have a major reflexive rally starting around 213, all the way back to at least to 250, and possibly 270. WSB is going to lose their minds holding their puts, and then load up on calls, declaring we've reached a bottom in the stock market. The next move will be put in place for the next leg down to 182, where certain actors will steal all your tendies on the way down. Also Monday might be another circuit breaker. tl;dr of tl;dr Big bounce incoming. Bear trap starting 213. Then bull trap up around 250-270. We're going down to around 182. tl;dr of tl;dr of tl;dr WSB will be screwed both left and right before they can say guh. Hint: If you want to get a Bloomberg article for free, hit esc repeatedly before the popup appears. If it doesn't work, refresh the article, and keep hitting esc. Remember, do not dance. We are on the cusp of a generational change. Use the money you earn to protect yourselves and others. Financial literacy and knowledge is the key to empowerment and self-change. Some good DD posts: u/bigd0g111 -https://www.reddit.com/wallstreetbets/comments/fmshcv/when_market_bounce_inevitably_comesdont_scream/ u/scarvesandsuspenders - https://www.reddit.com/wallstreetbets/comments/fmzu51/incoming_bounce_vix_puts/ Update 1 3/22/2020 - Limit down 3 minutes of futures. Likely hit -7% circuit breaker on the cash open on Monday at 213 as stated previously. Do not think we will hit the 2nd circuit breaker at 199.06. Thinking we bounce, not too much, but stabilize at least around 202.97. Update 2 3/23/20 9:08 - Watching the vote before making any moves. 9:40 - sold 25% of my SPY puts and 50% of my VXX calls 9:45 - sold another 50% of SPY puts 9:50 - just holding 25% SPY puts now and waiting for the vote/other developments 11:50 - Selling all puts. Starting my long position. 11:55 - Sold USO puts. 12:00 - Purchased VXX puts to vega hedge. 2:45 - Might sell calls EOD. Looks like a lot of positioning for another leg down before going back up. It's pretty common to shake things out in order to make people to sell positions. Just FYI, I do intraday trading. If you can't, just wait for EOD for the next positioning. 3:05 - Seeing a massive short on gold. Large amounts of calls on treasuries. And extremely large positioning for more shorts on SPY/SPX. Will flip into puts. Lot of people keep DM'ing me. I'm only going to do this once. https://preview.redd.it/uvs5tkje1ho41.png?width=2470&format=png&auto=webp&s=c6b632556ca04a26e4e08fb2c9223bfcb84e0901 That said, I'm going back into puts. Just goes to show how tricky the game is. 3:45 - As more shorts cover, going to sell the calls and then flip into puts around the last few min of close. Hope you guys made some money on the cover and got some puts. I'll write a short update later explaining how they set up tomorrow, especially with the VIX dropping so much. 3/24/20 - So the rally begins. Unfortunately misread the options volume. The clearest signal was the VIX dropping the past few days even though we kept swinging lower, which suggested that large gap downs were mostly over and the rally is getting started. Going to hold my puts since they are longer dated. Going to get a few short term calls to ride this wave. 10:20 - VIX still falling, possibility of a major short squeeze coming in if SPY breaks out over 238-239. 10:45 - Opened a small GLD short, late April expiration. 10:50 - Sold calls, just waiting, not sure if we break 238. If we go above 240, going back into calls. See room going to 247 or 269. Otherwise, going to start adding to my puts. https://preview.redd.it/ag5s0hccxmo41.png?width=2032&format=png&auto=webp&s=aad730db4164720483a8b60056243d6e4a8a0cab 11:10 - Averaging a little on my puts here. Again, difficult to time the entries. Do not recommend going all in at a single time. Still watching around 240 closely. 11:50 - Looks like it's closing. Still going to wait a little bit. 12:10 - Averaged down more puts. Have a little powder left, we'll see what happens for the rest of today and tomorrow. 2:40 - Closed positions, sitting on cash. Waiting to see what EOD holds. Really hard trading days. 3:00 - Last update. What I'm trying to do here posting some thoughts is for you guys to take a look at things and make some hypotheses before trading. Getting a lot of comments and replies complaining. If you're tailing, yes there is risk involved. I've mentioned sizing appropriately, and locking in profits. Those will help you get consistent gains. https://preview.redd.it/yktrcoazjpo41.png?width=1210&format=png&auto=webp&s=2d6f0272712a2d17d45e033273a369bc164e2477 Bounced off 10 year trendline at around 246, pretty close to 247. Unless we break through that the rally is over. Given that, could still see us going to 270. 3/25/20 - I wouldn't read too much into the early moves. Be careful of the shakeouts. Still long. Price target, 269. When does the month end? Why is that important? 12:45 - out calls. 12:50 - adding a tranche of SPY puts. Adding GLD puts. 1:00 est - saving rest of my dry powder to average if we still continue to 270. Think we drop off a cliff after the end of the quarter. Just a little humor... hedge funds and other market makers right now. 2:00pm - Keep an eye on TLT and VXX... 3:50pm - Retrace to the 10 yr trend line. Question is if we continue going down or bounce. So I'm going to explain again, haven't changed these lines. Check the charts from earlier. https://preview.redd.it/9qiqyndtivo41.png?width=1210&format=png&auto=webp&s=55cf84f2b9f5a8099adf8368d9f3034b0e3c4ae4 3/26/20 - Another retest of the 10 yr trendline. If it can go over and hold, can see us moving higher. 9:30 - Probably going to buy calls close to the open. Not too sure, seems like another trap setting up. Might instead load up on more puts later today. In terms of unemployment, was expecting close to double. Data doesn't seem to line up. That's why we're bouncing. California reported 1 million yesterday alone, and unemployment estimates were 1.6 million? Sure. Waiting a little to see the price action first. Treasuries increasing and oil going down? 9:47 - Added more to GLD puts. 10:11 - Adding more SPY puts and IWM puts. 10:21 - Adding more puts. 11:37 - Relax guys, this move has been expected. Take care of yourselves. Eat something, take a walk. Play some video games. Don't stare at a chart all day. If you have some family or close friends, advise them not to buy into this rally. I've had my immediate family cash out or switch today into Treasury bonds/TIPS. 2:55pm - https://youtu.be/S74rvpc6W60?t=9 3:12pm - Hedge funds and their algos right now https://www.youtube.com/watch?v=ZF_nUm982vI 4:00pm - Don't doubt your vibe. For those that keep asking about my vibe... yes, we could hit 270. I literally said we could hit 270 when we were at 218. There was a lot of doubt. Just sort by best and look at the comments. Can we go to 180 from 270? Yes. I mentioned that EOM is important. Here's another prediction. VIX will hit ATH again. 2:55pm EST - For DM's chat is not working now. Will try to get back later tonight. Stream today for those who missed it, 2:20-4:25 - https://www.twitch.tv/videos/576598992 Thanks again to WallStreetBooyah and all the others for making this possible. 9:10pm EST Twitter handles (updated) https://www.reddit.com/wallstreetbets/comments/fmhz1p/the_great_unwinding_why_wsb_will_keep_losing/floyrbf/?context=3, thanks blind_guy Not an exhaustive list. Just to get started. Follow the people they follow. Dark pool and gamma exposure - https://squeezemetrics.com/monitodix Wyckoff - https://school.stockcharts.com/doku.php?id=market_analysis:the_wyckoff_method MacroVoices Investopedia for a lot. Also links above in my post. lol... love you guys. Please be super respectful on FinTwit. These guys are incredibly helpful and intelligent, and could easily just stop posting content.
HPE: Transition to As-a-Service and Path to All-Time Highs
COVID-induced demand pressures for enterprise hardware and recent execution issues have HPE shares trading at 4-year lows and down 41% YTD. However, HPE-as-a-Service strategy starting to show real momentum. Combined with advancements in edge-to-cloud infrastructure offerings, HPE among best values in large cap tech for investors looking to gain exposure to edge networking, distributed computing, and remote working trends. Here's why: Background What is HPE exactly? It is a question that HPE itself has found difficult to answer in the five years since splitting off from the original Hewlett Packard (HPQ). At the time of the split, HPE was more or less described as everything but the PCs and printers. It was a lot of hardware, software, services, but without a clear strategy on how to win in the age of the cloud. As other companies from the PC era, like Microsoft, Dell, and Intel, effectively pivoted their businesses to compete in the cloud and data center, HPE experienced a combination of false starts, missteps, and inconsistent execution. Following its most recent quarterly report in May, an earnings miss coupled with a new cost-cutting initiative sent shares down 10%. And the company now trades at levels not seen since early 2016. With HPE trading at less than 7x forward earnings, markets seem to be pricing in a low probability of a turnaround. However, despite difficulties in gaining traction as a standalone company, it may not be time to give up on HPE just yet. Revenue misses in six consecutive quarters and fears over another round of restructuring are distracting from early signs of success in HPE’s transformation to an as-a-service company. With the mega cap and hyper-growth tech trade looking a little overheated on a valuation basis, HPE could present an attractive way to gain exposure to multiple long-term technology trends – namely edge networking, distributed computing, and remote work – while also benefiting from a stabilization and recovery in enterprise hardware IT spend once the COVID-19 induced headwinds subside. Summary
Previous company pivots failed to position the company to succeed in the cloud era
Near-term, HPE remains subject to enterprise hardware demand pressures due to COVID-19
Past execution issues, inconsistent earnings, and multiple restructuring efforts are overshadowing momentum developing under HPE-as-a-Service strategy
Once enterprise hardware spend rebounds, HPE likely to show material improvements in financial performance and execution
HPE 3.0 is poised to expand margins, provide greater revenue stability, and grow earnings power on the back of major trends in networking, computing, and work
Assigning HPE a three-year price target of $35
HPE 1.0 and 2.0: How We Got Here HPE 1.0 When HPE was still part of the combined HPE-HPQ, the company had attempted to carve out share in the public cloud and was unsuccessful. Having shuttered that business in 2015, HPE sought to position itself as a more focused and agile end-to-end infrastructure solutions company. This was the strategic rationale behind the decision to merge its enterprise services division with CSC in 2017. The resulting DXC Technology became a pure-play IT services and consulting company. HPE then sold the majority of its enterprise software, database, and analytics offerings to UK-based Micro Focus. HPE 2.0 Around the time of the spin-merger with Micro Focus, HPE revealed its “HPE Next” strategy to fundamentally redesign the company over a three-year period. Although HPE stated its desire to streamline operations, optimize manufacturing, and improve its go-to-market approach, HPE Next was mostly workforce optimizations, or in other words: layoffs. HPE Next did contribute to improvements in EPS numbers from 1Q18 to 4Q19, but following a modest increase in revenue over the first four quarters under the plan, sales have been stagnant or lower in each of the subsequent reports. 2Q20 Earnings As part of HPE’s 2Q20 earnings release, the company announced yet another restructuring plan aimed at conserving capital, flexibility, and liquidity given the uncertainty surrounding the global pandemic. The cost-cutting calls for at least $1bn in targeted gross savings by 2022. Together with a 15% decline in revenues year-over-year when holding for currency fluctuations, analysts were quick to issue six downgrades. These numbers do not tell the whole story though. In the face of a tough pricing environment for hardware, gross margins were stable at 32% compared to last year. And several critical business segments showed signs of relative strength in light of the broader market context. HPE’s big data solutions grew 61% year-over-year, with storage services from the Nimble business unit jumping 20%. HPE’s edge networking segment that houses HPE Aruba only saw declines of 2%. And HPE’s flagship as-a-service offering, HPE GreenLake, saw its annual revenue run rate increase 17% to $520mn. HPE GreenLake is now the company’s best performing business according to CEO Antonio Neri. When considering HPE exited the quarter with a $1.5bn backlog, or 2x historical levels, it’s very likely that procurements were delayed or rescheduled rather than canceled. Because of this, once IT departments have greater visibility into the crisis, HPE should be poised to see a sharp recovery in its hardware-focused reporting segments. HPE 3.0: HPE-as-a-Service After years of difficulties defining its value proposition in the new computing landscape, HPE appears to have developed a distinct approach to leverage its networking, computing, storage, and software capabilities and bundle them into a fully integrated edge-to-cloud platform. The strategy, HPE-as-a-Service, aims to offer every single HPE product on a pay-per-use subscription basis by 2022. The company’s new IT equipment and services package, HPE GreenLake, takes a range of products selected by the customer and provides a simplified management console and on-demand toolkit for the entire hybrid cloud setup. As HPE further transitions towards the as-a-service model, HPE GreenLake, as well as its advancements in edge networking and performance computing, could lead to greater market share in multiple segments of hybrid IT spend. HPE GreenLake As enterprise IT becomes increasingly hybrid – i.e. a mixture of on-premise and off-premise computing power – organizations have seen management of these systems become more siloed. As a result, companies are seeing greater demands on their IT staff, inconsistent user experiences or application performance, or lower visibility or risk control across networks. HPE GreenLake is a bundled-service offering that enables customers to select only the capabilities that they need and to deploy them faster, with less management, and at a lower CAPEX risk. Through its metering features, GreenLake makes it much easier for companies to scale computing resources up or down, thereby enhancing flexibility while also allowing IT teams to offload management of hybrid cloud resources to HPE’s operations center. Once customers sign up for HPE GreenLake, they select from 15 cloud services like machine learning, virtual machines, big data, networking, storage, or compute. HPE promises to have the chosen services delivered and operational within 14 days. And GreenLake runs on top of existing Amazon AWS or Microsoft Azure cloud computing environments, making the transition seamless. According to HPE, GreenLake reduces time-to-market for IT deployments by 75%, reduces CAPEX by 40% once in-use, and delivers 147% return on investment and total payback within 12 months. Improving deployment efficiencies not only conserves staffing resources and expands business productivity, it reduces the need for companies to invest in IT infrastructure before they are ready. Because HPE GreenLake is pay-per-use, customers can prevent overprovisioning of resources and eliminate expenses associated with technology refreshes, all the while ensuring adequate posture to accommodate usage spikes when on-premise compute is not sufficient. Customer satisfaction for GreenLake is extremely high, with HPE reporting 99% retention rate for contract customers currently subscribed to the platform. The Edge, Distributed Computing, and Remote Work Even though COVID-19 sparked some near-term challenges for enterprise hardware demand, the pandemic has also accelerated much longer-term trends related to computing and working – trends that should benefit HPE. As companies increasingly leverage computing power at the edge, and as work becomes more and more distributed and remote, the comprehensive end-to-end edge networking platform developed by HPE Aruba and recently-acquired Silver Peak could lead to share gains in multiple end markets projected to grow for the rest of the decade. According to Cisco, by 2025, 75 billion devices will be connected to the internet. Between the combination of IoT and the growing number of user devices consuming larger amounts of content digitally, the global datasphere is forecasted to roughly triple by then. And at that time 75% of enterprise-generated data is expected to be processed at the edge. In a widely distributed computing environment with exponentially greater data loads, it will become even more vital for IT purchasers to invest in and maintain the right set of networking tools to compete in the future. HPE Aruba HPE Aruba provides a range of wired and wireless data center and edge networking solutions, including Wi-Fi 5 and Wi-Fi 6 products, access points and gateways, as well as network switches for both data center and edge locations. Although HPE Aruba has pushed into SD-WAN, historically its business has been driven by WAN and WLAN hardware and services. A WAN, or wide-area network (WAN) is a collection of local-area networks (LANs) or other networks that communicate with one another. A WAN is essentially a network of networks (like a much smaller internet). WLAN is simply a wireless LAN that connects computers and network devices wirelessly. While the enterprise WLAN market actually fell 2.2% year over year in Q1 2020 due to COVID-19, WLAN is forecasted to grow at over 20% annually the next five years on the back of technology refreshes associated with the new Wi-Fi 6 standard (enterprise WLAN was a $1.3bn market in Q1) and increased adoption of Internet-of-Things (IoT) devices. And HPE Aruba is currently the #2 leader in market share at 14.4% after Cisco at 45.7%. Perhaps where HPE Aruba is set to deliver the strongest results over the long-term, though, is in its newly announced edge networking architecture called the Edge Services Platform (ESP). Aruba ESP is the industry’s first AI-powered platform designed to unify, automate, and secure edge networking. Aruba ESP leverages artificial intelligence to simplify IT operations management as well as accelerate and automate troubleshooting in distributed IT environments. With built-in Zero Trust Security, ESP secures all access across your network. And the platform also provides unified infrastructure so that WLAN, LAN, and SD-WAN resources can be singularly monitored and optimized across branch, campus, remote, and data center locations. This is important because the promise of the edge is in the ability to more rapidly acquire real-time data so that it can be more quickly analyzed and acted upon. By deploying integrated networking and analytics at the edge, Aruba ESP can enable businesses to optimize process efficiency, boost security, and increase reliability. This capability removes the previous need to send data to a remote data center location or third-party company for analytics. Silver Peak HPE’s acquisition of Silver Peak is a great strategic investment to further build out its integrated edge product portfolio. With the strength of HPE Aruba in WAN/WLAN, HPE will soon be able to offer market-leading SD-WAN solutions alongside its AI-powered intelligent edge platform, making for a very compelling and comprehensive product suite for enterprise customers. SD-WAN, or software-define WAN, uses software to replicate (virtualize) functionalities that traditionally were housed within hardware. What this allows for is functions to then be remotely monitored and controlled. It makes network management simpler, bolsters security, and enables much more efficient network routing. Despite being one of the few remaining independent SD-WAN players, Silver Peak has carved out a spot near the top of the market. The company counts over 1,500 customer deployments for its Unity EdgeConnect™ SD-WAN edge platform, and Silver Peak is consistently among the five largest vendors with over 7% market share in a field that includes heavyweights such as Cisco and VMware. The SD-WAN sector hit $1.9bn in 2019, but industry estimates expect it to reach $8bn by 2025 – delivering compounded annual growth of nearly 35%. Having been named by Gartner as one of two leaders (alongside Cisco) in its SD-WAN magic quadrant for two consecutive years, a combined HPE Aruba-Silver Peak solution is primed to capture even more market share for enterprise customers would like to pursue a multi-vendor strategy or diversify away from over-reliance on Cisco. The Path to Gaining Share in Computing Composable Infrastructure HPE’s software-define infrastructure innovations extend to computing as well, namely with HPE Synergy which started shipping in early 2017. HPE Synergy is a new category of computing infrastructure designed to bridge non-cloud-native and cloud‐native applications. Non-cloud-native applications are applications that exist with persistent storage and usually have a fixed number of network connections. This contrasts with cloud-native applications which are designed for a cloud environment. As much as services are being shifted to the cloud, for some companies, applications have existed in non-native states for so long that it could be risky and costly to move to the cloud or could require significant time and resource planning. This is where composable infrastructure and HPE Synergy steps in. Composable infrastructure treats compute, storage, and network devices as pools of resources that can be tactically provisioned as needed depending on the requirements of distinct workloads. It can be instantly flexed to meet the needs of any application or any workload, and it is ideal for a hybrid cloud environment. DellEMC released its version of a modular composable server halfway through 2018, and a startup named Liqid is also in the space. Past studies have put average server utilization rates between 15-35% because typical server designs have fixed amount of resources provisioned against disparate application needs. In a study commissioned by HPE, enterprise data center respondents reported that only 45% of infrastructure was provisioned most of the time, leaving over half of a company’s valuable computing resources unused. Although converged and hyperconverged infrastructure also combine computing, networking, and storage, only composable infrastructure is not preconfigured for specific workloads. On top of that, composable is more scalable than hyperconverged which can be limited to 20-30 nodes. HPE Synergy thus greatly reduces dedicated IT staff time to deploy servers or install firmware, increases productivity, and lowers procurement and operating costs. HPE Synergy is estimated to deliver three-to-one return-on-investment for IT customers over a five-year period. With composable infrastructure projected to follow hyperconverged systems and hit nearly $5bn in sales by 2023, Synergy could provide HPE yet another competitive product advantage to carve out share in a healthier IT hardware procurement environment. HPE Cray Supercomputers and Big Data In addition to traditional IT infrastructure, product advancements in high performance computing also have HPE positioned to gain new customer wins and develop the reporting segment into a larger contributor to the top line over time. Although the term supercomputing has been around for a few years, for many it continues to be an abstract or futuristic concept without tangible applications for today. But as tens of billions of internet-connected machines come online over the next decade, the amount of structured and unstructured data being generated will become that much harder to translate into valuable or actionable insights. That is why supercomputing can play a major role in solving the most data-intensive challenges facing corporations and governments worldwide. The US and China have been engaged in heavy competition in recent years to create faster and faster supercomputers, and other countries like Japan are also starting to get involved. Currently supercomputers are used in the fields of life sciences, genomics, manufacturing, weather, and nuclear science. However, in the age of IoT and zettabyte-scale datasets, much more powerful computers will be necessary to fully take advantage of big data analytics and artificial intelligent capabilities. The fastest exascale-class supercomputer in the world today is an HPE Cray supercomputer named El Capitan. The system, which will be delivered to the US Department of Energy’s Lawrence Livermore National Laboratory by 2023, is 10x faster than the runner-up. This market is still extremely nascent, and supercomputing is only a portion of the 9% of HPE revenues generated by the High Performance Compute & Mission Critical Systems (HPC MCS) segment’s. But as the market becomes more mature, HPE GreenLake will provide a stronger ability to cross-sell supercomputing products to very large-scale organizations – a major advantage for HPE Cray compared to when it was a standalone company. Conclusion Recent weakness in HPE shares following Q2 earnings have largely priced-in near-term risks associated with COVID-induced demand pressures for enterprise hardware solutions. With shares down 41% YTD, the company is trading at 6.63X forward earnings and 0.44x sales. These multiples are both among the lowest levels relative to other large cap IT hardware peers such as Dell (10.99 forward P/E), Cisco (13.81 forward P/E), or IBM (11.16 forward P/E). Despite difficulty formulating an effective cloud strategy in the years following the split from HP, HPE has multiple growth drivers with exposure to critical long-term computing, networking, and working trends. As HPE further develops its business into a fully service-based, pay-per-use model, revenue and earnings should become increasingly stable and less subject to near-term demand shocks as has been seen so far in 2020. Although management’s cost saving plan announced in May was poorly received by the markets, strong sales visibility by virtue of the $1.5bn quarterly contract backlog means that HPE’s struggles will likely be short-term. Combined with cost reductions, as enterprise hardware spending picks back up, the company should experience gross margin improvements, earnings growth, and multiple expansion. Together with the more targeted approach as an edge-to-cloud infrastructure service provider, HPE currently presents one of the best values in large cap tech for investors looking to gain exposure to edge networking, distributed computing, and remote working trends over the next 5-10 years. You can find me on Twitter@BlackjacketCowhere I write about emerging technologies and long-term market trends. Thanks for reading!
I want to open an account with Oanda with about $500-$1000 they say their leverage is about 50:1, so what does this mean exactly? What lot sizes would I be able to trade with $500-$1000 in my account? I’m assuming it would be mini or micro lots.. but if I’m wrong let me know! Thanks. :)
The fee schedule below provides the applicable rate based on the account's 30-Day Volume and if the order is a maker or taker. Bittrex Global Fee30 Day Volume (USD)MakerTaker$0k - $50k0.2%0.2%$50k - $1M0.12%0.18%$1M - $10M0.05%0.15%$10M - $60M0.02%0.1%$60M+0%0.08%>$100MContact TAM representative Trading expenses are incurred when an order is prepared by means of the Bittrex worldwide matching engine. While an order is being executed, the purchaser and the vendor are charged a rate primarily based on the order’s amount. The fee charged by Bittrex exchange is calculated by the formula amount * buy rate * fee. There aren't any charges for placing an order which is not being executed so far. Any portion of an unfinished order will be refunded completely upon order cancelation. Prices vary depending on the currency pair, monthly trade volume, and whether the order is a maker or taker. Bittrex reserves the right to alternate fee quotes at any time, including offering various discounts and incentive packages.
Your buying and selling volume affects the fee you pay for every order. Our expenses are built to encourage customers who ensure liquidity in the Bittrex crypto exchange markets. Your buying and selling charges are reduced according to your trade volume for the last 30 years in dollars. Bittrex calculates the 30-day value every day, updating every account's volume calculation and buying and selling charge between of 12:30 AM UTC and 01:30 AM UTC every day. You can check your monthly trade volume by logging in and opening Account > My Activity. https://preview.redd.it/n1djh2ob4zh51.jpg?width=974&format=pjpg&auto=webp&s=2eebb9c9ac63de207c4dd2e49bc45aeb53a8dec8
6. Withdrawing Funds
Withdrawing any type of funds is likewise simple. You can profit by buying and selling Bitcoin, Ether, or any other cryptocurrency. You determine the crypto address—to which the amount will be credited—and the transaction amount. The withdrawal fee will be automatically calculated and shown right away. After confirming the transaction, the finances will be sent to the specified addresses and all that you need to do is to wait for the community to confirm the transaction. If the 2FA is enabled, then the user receives a special code (via SMS or application) to confirm the withdrawal.
7. How to Trade on Bittrex Global
Currency selling and buying transactions are performed using the Sell and Buy buttons, accordingly. To begin with, the dealer selects a currency pair and sees a graph of the rate dynamics and different values for the pair. Below the chart, there is a section with orders where the user can buy or sell a virtual asset. To create an order, you just need to specify the order type, price, and quantity. And do not forget about the 0.25% trade fee whatever the quantity. For optimum profit, stay with liquid assets as they can be quickly sold at a near-market rate effective at the time of the transaction. Bittrex offers no referral program; so buying and selling crypto is the easiest way to earn. https://preview.redd.it/hopm6fih4zh51.jpg?width=1302&format=pjpg&auto=webp&s=68c0aaae86f64c3e6b9d351c3df2a9c331f94038
Bittrex helps you alternate Limit and Stop-Limit orders. A limit order or a simple limit order is performed when the asset fee reaches—or even exceeds—the price the trader seeks. To execute such an order, it is required that there's a counter market order on the platform that has the identical fee as the limit order.
Differences between Limit Order and Stop Limit Order
A stop limit order is a mixture of a stop limit order and a limit order. In such an application, charges are indicated—a stop charge and the limit.
Let’s discuss how you could trade conveniently with our service. The key features include a user-friendly interface and precise currency pair statistics (timeframe graphs, network data, trade volumes, and so forth). The platform’s top-notch advantage is handy, easy-to-analyze, customizable charts. There is also a column for quick switching between currency pairs and an order panel beneath the fee chart. Such an all-encompassing visual solution helps compare orders efficiently and in one place. You can use the terminal in a day or night mode; when in the night mode, the icon in the upper-right corner changes and notice the Bittrex trading terminal in night mode is displayed. The main menu consists of 4 sections: Markets, Orders, Wallets, Settings. Markets are the trade section. Bittrex allows handling over 270 currency pairs. Orders. To see all open orders, go to Orders → Open. To see completed orders, go to Orders → Completed. Wallets. The Wallets tab displays many wallets for all cryptocurrencies supported by the exchange and the current balance of each of them. After refilling the balance or creating a buy or sale order, you will see all actions in the section. Bittrex allows creating a separate wallet for every coin. Additionally, you can see how the coin price has changed, in terms of percentage, throughout the day. Here’s what you can also do with your wallets:
Hide zero balances: hide currencies with zero balance
Green and red arrows: replenish balance/withdraw funds
Find: search for a cryptocurrency
The Settings section helps manage your account, verification, 2FA, password modification, API connection, and many more.
How to Sell
The process of selling crypto assets follows the same algorithm. The only difference is that after choosing the exchange direction, you need to initiate a Sell order. All the rest is similar: you select the order type, specify the quantity and price, and click Sell *Currency Name* (Sell Bitcoin in our case). If you scroll the screen, the entire history of trades and orders will be displayed below.
LONG and SHORT
You can make a long deal or a short deal. Your choice depends on whether you expect an asset to fall or rise in price. Long positions are a classic trading method. It concerns purchasing an asset to profit when its value increases. Long positions are carried out through any brokers and do not require a margin account. In this case, the trader’s account must have enough funds to cover the transaction. Losses in a long position are considered to be limited; no matter when the trade starts, the price will not fall below zero with all possible errors. Short positions, in contrast, are used to profit from a falling market. A trader buys a financial instrument from a broker and sells it. After the price reaches the target level, the trader buys back the assets or buys them to pay off the initial debt to the broker. A short position yields profit if the price falls, and it is considered unprofitable the price matches the asset value. Performing a short order requires a margin account as a trader borrows valuable assets from a broker to complete a transaction. Long transactions help gain from market growth; short from a market decline.
Trade via API
Bittrex also supports algorithmic trading through extensive APIs (application programming interface), which allows you to automate the trading process using third-party services. To create an API key, the user must enable the two-factor authentication 2FA, verify their account, and log in to the site within 3 minutes. If all the requirements of the system are fulfilled, you can proceed to generate the API key. Log in to your Bittrex account, click Settings. Find API Keys. Click Add new key (Create a new key). Toggle on / off settings for READ INFO, TRADE, or WITHDRAW, depending on what functionality you want to use for our API key. Click Save and enter the 2FA code from the authenticator → Confirm. The secret key will be displayed only once and will disappear after the page is refreshed. Make sure you saved it! To delete an API key, click X in the right corner for the key that you want to delete, then click Save, enter the 2FA code from the authenticator and click Confirm.
Bittrex Bot, a Trader’s Assistant
Robotized programs that appeared sometimes after the appearance of cryptocurrency exchanges save users from monotonous work and allow automating the trading process. Bots for trading digital money work like all the other bots: they perform mechanical trading according to the preset parameters. Currently, one of Bittrex’s most popular trading bots is Bittrex Flash Crash Buyer Bot that helps traders profit from altcoin volatility without missing the right moment. The program monitors all the market changes in the market every second; also, it even can place an order in advance. The Bittrex bot can handle a stop loss—to sell a certain amount of currency when the rate changes in a favorable direction and reaches a certain level.
8. Secure Platform
Bittrex Global employs the most reliable and effective security technologies available. There are many cases of theft, fraud. It is no coincidence that the currency is compared to the Wild West, especially if we compare the 1800s when cowboys rushed to the West Coast of America to earn and start something new in a place that had no rules. Cryptocurrency is still wild. One can earn and lose money fast. But Bittrex has a substantial security policy thanks to the team’s huge experience in security and development for companies such as Microsoft, Amazon, Qualys, and Blackberry. The system employs an elastic, multi-stage holding strategy to ensure that the majority of funds are kept in cold storage for extra safety. Bittrex Global also enables the two-factor authentication for all users and provides a host of additional security features to provide multiple layers of protection. Bittrex cold wallet: https://bitinfocharts.com/en/bitcoin/address/385cR5DM96n1HvBDMzLHPYcw89fZAXULJP
Bittrex Global is a reliable and advanced platform for trading digital assets with a respected reputation, long history, and active market presence and development nowadays. The exchange is eligible to be used globally, including the US and its territories. The legal component of Bittrex Global is one of the most legitimate among numerous crypto-asset exchanges. The Bittrex team has had great ambitions and managed to deliver promises and more. The exchange staff comprises forward-thinking and exceptional individuals whose success is recognized in the traditional business and blockchain sector. Bittrex's purpose is to be the driving force in the blockchain revolution, expanding the application, importance, and accessibility of this game-changing technology worldwide. The exchange fosters new and innovative blockchain and related projects that could potentially change the way money and assets are managed globally. Alongside innovation, safety will always be the main priority of the company. The platform utilizes the most reliable and effective practices and available technologies to protect user accounts. Bittrex customers have always primarily been those who appreciate the highest degree of security. Because of the way the Bittrex trading platform is designed, it can easily scale to always provide instant order execution for any number of new customers. Bittrex supports algorithmic trading and empowers its customers with extensive APIs for more automated and profitable trading. One of the common features which is not available on the exchange is margin trading. No leverage used however adds up to the exchange's stability and prevents fast money seekers and risky traders from entering the exchange. Bittrex is a force of the blockchain revolution and an important entity of the emerging sector. The full version First part Second part
I beat Bloodstained recently, and because this forum seems to think Hollow Knight is the greatest game ever while Bloodstained sucks I decided to go against the grain a bit and create a different discussion. Granted, overall I think Hollow Knight is better, but that's doesn't mean it's better on every aspect. Now, I found Bloodstained and Hollow Knight essentially took opposite approaches to building large Metroidvanias (in summary, Bloodstained gets it's complexity by filling out large continuums with quantitative variations, while Hollow Knight gets it through combinatorics by giving unique behavior to simple things which then synergize), so I don't think it's necessarily fair to compare them, but I'm going to do it anyway. This post is very long as I've found a lot to talk about, so I don't recommend reading the whole thing. Each paragraph is one aspect, you should be able to get what it is just from reading the first sentence, the rest of the paragraph is just an argument as to why I found that aspect to be better if you care to read it. I'll post the list of all the aspects in the concluding paragraph. With that being said, here it goes. First, I prefer Bloodstain's save/death system over Hollow Knight's. While autosaving is convenient, I honestly prefer manual saving as I like having control over those cases where you don't want to overwrite your savefile. In Hollow Knight's case, it's clear that they implement autosaving specifically to prevent you from doing that, as otherwise their death mechanic wouldn't work, and it makes certain choices permanent. It really says something about how brutal Hollow Knight's death mechanic is that it would be preferable for the game to just end and have to be reloaded from a save point. In addition to being brutal, I find such a mechanic to be a poor fit for Metroidvania's, as forcing the player to go to the same destination to recover discourages exploration or trying different routes when a particular ones proves too hard. The logistics of the whole thing are also pretty iffy, both with the shade mechanic and with autosaving and returning to a save point on quitting, and both can be exploited in ways that feel to defy the logic of the game. The thing I like the most about Bloodstain's save system is that it has lots of slots you can branch out into, which I like using to save before boss fights in case I want to refight them. Hollow Knight's Hall of Gods is much more convenient, but it still fails to capture all such fights that a player might want to reattempt with a different strategy (the big one being the Pale Lurker), and not all the fights it does have are quite the same as the original (Uumuu in particular feels like a completely different fight), so it does not make having such a feature be obsolete. Even when bosses are available unchanged in the house of gods though, the fact that the Hall of Gods can't even be unlocked until midgame needs to be considered, while save branching can be done immediately after the boss is fought. Finally, even though Hollow Knight has autosaving, it still has save points, and Bloodstained does a much a better job at placing save point in desirable locations. In particular, Bloodstained always has a save point before a boss, while there is some frustrating exceptions in Hollow Knight. Next, I prefer Bloodstain's map system. It's simple, but effective, and in terms of functionality has most of the features of Hollow Knight's, with essential features like save points and NPCs being marked in one way or another, and personal markers are given as well. Hollow Knight's maps are certainly prettier, but that doesn't necessarily make them more useful. They have a couple advantages with the colored regions and drawn out landmarks, but are also frustrating in other ways, such as with the limited markers, and the fact you need to buy everything first. The biggest issue though is the fact that maps must be bought before they can be used. This wouldn't be a bad idea by itself, but in practice it isn't used particularly well, as the map is often either is often either hid so near the entrance that they might as well start with it, or being hidden so late that they needs to frustratingly memorize the area before getting to it. The fact they cost geo is little more than a nuisance, as they don't cost enough for the player to ever be worth passing them up for now, but it's still often enough to just waste time grinding until enough geo is gathered to buy them. The problems with the map system are exacerbated by the shade mechanic, as a map is needed to track down the shade. This further discourages exploration, as it encourages someone to either just map a beeline towards the map while ignoring everything else, or just avoid areas entirely that they don't have the map for. Fog Canyon in particular was frustrating, as the map in positioned in such a place to actively discourage exploring the region until the player gets the shade cloak, but the area was designed to be cleared with either the shade cloak or Isma's tear, and the map can actually be picked up pretty easily picked up with the latter if the player wasn't discouraged from exploring by the tease combined with frustrating game mechanics. Bloodstained did a much better job at handling money than Hollow Knight. I never found myself having to grind for money in Bloodstained, but I did in the early game for Hollow Knight. The biggest issue with currency in Hollow Knight though is in the late game, which is that geo becomes absolutely useless once everything is bought. There is one stock that never exhausts, the rancid eggs, but these become all but useless after everything else is bought out as the only use for rancid eggs is recovering the player's shade, where the primary purpose for doing such is just to recover geo. The only other reason would be to fix the soul gage, but in most cases it would probably be faster to just kill yourself than to return to Confessor Jiji in order to fetch the shade. This issue is amplified in Steel Soul mode, where geo will likely accumulate to a greater extent due to not being lost on death, rancid eggs can no longer be bought, and the end game geo sinks are useless as they only prevent an effect that occurs on death. The one other replenishable stock, fixing the fragile charms, can't be restored either as the charms only break on death. This is not an issue as Bloodstained. Not only is it much harder to pay for everything, and consumable items ensure that there will always be practical stock remaining, but there is uses for money other than buying items, namely the gold bullet spell and the gold power ring. While charms can slightly modify the attack in Hollow Knight, the overall form remains the same, with the same nail attacks and the same spells. Meanwhile, by changing up weapons and spell shards, several different modes of combat are possible in Bloodstained. For example, one spell I enjoyed using in Bloodstained is Plume Parma, which launches a flying pig that bounces around the arena, and it's fun challenge to work on the geometry of arenas and boss patterns to figure out where to launch the pig so it hits the boss the maximum number of times before it pops. Hollow Knight has nothing comparable. As far as actual weapons go, boots encourage completely different fighting styles than swords or guns do. The fact there are different attack types as well also mixes stuff up in Bloodstained by more explicitly encouraging different builds. With that said, I did find Hollow Knight to have much better synergy between charms than any items in Bloodstained did, the limitation is just in modes of combat. I found the traversal items to be much more interesting in Bloodstained. Hollow Knight's are pretty generic, with the most interesting one being super-dash, which is kinda annoying. Bloodstained had three more interesting traversal abilities with reflector ray, invert, and dimension shift. I do have to say the Hollow Knight did a much better job at actually putting it's traversal abilities to use, but even then I do think Bloodstained had a much more useful invert mechanic than most games where something similar can be done. Even with some of the more generic abilities Bloodstained had more interesting traversals. The best example of this is with how they handle water, where all Hollow Knight's traversal does is make some more water swimmable on the surface, while Bloodstained has two different traversal abilities for water, each allowing different ways to explore it in 2d space. One thing that always frustrated me in Hollow Knight is how little of a difference upgrades in the game actually made. The clincher is the fact that once you get ALL mask upgrades and vessel fragments, you're still not even twice as powerful as you were at the start of the game. This difference is even more marginal when you consider how easy it is to heal and recover soul in this game, so in practice you have much more soul and life available then the meters indicate. On the other hand, if you do get pushed to the edge (which is the only point where health upgrades make a different anyway) and recover, then the effect is amplified as you could recover more than one mask after you otherwise would have died. For what they are worth, it annoys me that there are much easier method to continue pushing life past the limit, such as by farming lifeblood, making there be little incentive to actually track down any upgrades. This is one area where Hollow Knight's emphasis on the discrete works against it, as complete sets are needed before mask shards or vessel fragments, while any individual health or magic upgrade in Bloodstained makes a difference, even if it's so small that it's only situational. What really makes this bad is exactly how the upgrades are obtained. In short, I've found that for both masks shards and vessels fragments there is one that is extremely hard to get, a few that are fairly challenging, and most are a matter of going to the right place. As a result, there is little incentive to tackle the fairly challenging ones unless one is also confident that they can get the extremely challenging one as otherwise they won't amount to anything once all the easy shards and fragments are picked up, collapsing challenges with rewards of varying levels of difficulty into one. Unlike the masks, the fully upgraded nail is significantly more powerful the original nail. I don't like the way I paced the upgrades though. Each nail upgrade adds a constant amount of damage to the nail which is slightly less damage than the starting nail. This is fine, though the practical effect is somewhat sporadic due to most enemies having so few hit-points that the ratio between the previous number of hits it took to kill an enemy to the new number of hits is often quite different from the ratio between the previous amount of damage the nail did to the new amount of damage. It would be more consistent against bosses, if it wasn't for the fact that many bosses are giving more hits as the nail is upgraded so the effect is nerfed. Even worse, spells don't become more powerful, so a boss can actually become HARDER when thought with more powerful nail. While not a boss, I noticed this effect with the shade, which was quite annoying. With those aside, the issue comes from the fact the requires for upgrading the weapon are not constant, but instead increase linearly. By itself this would be reasonable as it would be expected for their be a greater requirement to get a constant improvement later on to reflect the increasing difficulty of the game, but the issue comes from the fact that the upgrade requirement is from a rare item, of which each is required to get the final upgrade. As result, the difficulty of upgrading the item increases superlinearly, not linearly. To explain why, I'll use this example of completing a set of trading cards by buying random cards. Say there are twelve possible cards that could be randomly gotten, there is six in the set you're trying to complete, and the package contains one card. With the first package, you have a 1/2 chance of getting a card in the set, and thus getting one card closer to complete set. Once you have 5/6 cards in the set though, you only have 1/12 chance of getting one card closer to completing the set as you need the specific one that you are missing, not just any card in the set. You can't apply the same calculations to Hollow Knight as obtaining the ore isn't random, it's gotten by performing certain tasks, but similar reasoning applies. The issue isn't just that it's superlinear though, but the exact values are poorly balanced. To get the first nail upgrade, you need zero pale ore, while the final upgrade needs three pale ore, which is half the total pale ore. As a result, it's strictly harder to get the final nail upgrade than to get ALL the nail upgrades before it, but the proportional effect isn't anywhere close to what you get for ANY of the upgrades before it. This lack of marginal improvement is then exacerbated by the fact that some pale ore is much easier to get than others (easiest is basically just found on the wayside on a route you have to go down anyway, hardest requires completing the second of three gauntlets), so of course the easy to find ones are all going to found before the hard ones. The reward to effort ratio is just completely out of wack for the final nail level, and I find that it just added one more nail level and four more ore it could have been much more reasonable without changing the overall system. Meanwhile, Bloodstained does damage upgrades completely differently. Frankly I don't know how Bloodstained scales damage other than it being much more complicated, but in practice I found it to be much better paced than it was in Hollow Knight. There is an issue where occasionally you randomly got a weapon that's much more powerful than the weapons you should have at that point so until you get to the next stage most weapons you pick up are useful, but overall I found it to be much better. Bloodstained has much more interesting alternative game modes than Hollow Knight does. First off, it has different difficulty settings, which Hollow Knight just lacks. If we consider Hollow Knight's alternative game modes, none of them actually add any functionality. Steel Soul mode technically adds a single new feature in the form of Steel Soul Jinn, but as all she does is convert eggs to geo, which is not particularly useful for the reasons explained in the section on money. The fact the save file deletes on death doesn't actually add functionality as a player could impose this challenge on themselves by choosing to manually delete their save file on death, all it does is automate the process. I guess you could consider the achievements associated with the mode as an added feature, but those are spoiled by the fact you can save you run by just quitting before death, meaning you can play as if you only have one less hit, and can't do any shade-jumping exploits. The other mode is Godseeker mode, which is it's answer to Boss Rush mode. It sounds like a good idea, but it's pretty terrible in practice because you can already do all of Godhome in the main game, and all Godseeker mode is just Godhome and nothing but Godhome. I see two potential uses for this mode, the first is that in Godseeker mode you're fulling upgraded so it can be done to get around having to get all the upgrades yourself, and the second is that Godhome is a pain to get to to and get out of, so just opening a second save file can be done instead for convenience sake. The problem is, it's so hard to unlock Godseeker mode that by the point you've gotten there you've probably already done every else, so you don't need to unlock any upgrades, and you can just set around in Godhome while you try to clear it in the main game as you don't actually need to leave. As it is I still haven't cleared the third pantheon, but the only upgrade I'm missing is the fourth level Grimm charm, which I frankly don't find to be worth beating either Nightmare Grimm or the third Pantheon for. The fact the Hall of Gods is almost filled in Godseeker mode means it could be used to fight the handful of bosses (Pure Vessel, Winged Nosk, and the Sisters of Battle) that still need to be unlocked in Godhome if you're unable to clear the fourth Pantheon, and it can be used to fight Grey Prince Zote if you let the real one die, but that's not much. Bloodstained also has a Boss Rush Mode, but it's much more reasonable to unlock, just requiring the bosses to be rather than tracking down some obscure location and complete the challenges there, and it doesn't waste an entire safe file. It also actually emphasizes the rush part, with a timer for high scores, and performance rewards that can actually be used in the main game instead of just being some weird isolated challenge for getting an alternative ending. With boss revenge mode it has another fun challenge mode that's unlike anything in the game, but it also has a couple full length modes that act like full games. Right now they have Zangetsu mode and randomizer mode, both of which are substantially different from the main game. Bloodstained is still being updated to add new game modes, while Hollow Knight is now capped at it's definitive version. Finally, I found Bloodstained to be much more reasonable with how it distributed its alternative endings. Hollow Knight has five endings, but two of them are just variations, so I'll only consider three of them. Bloodstained also has three endings, so we can compare them. As far as it can be measured, I feel these endings are roughly distributed in the same way: the first ending is a bit over half-way through the game, and final ending requires doing a bit more than the second one. The main difference I feel in between how this three endings are distributed between the games is that in Bloodstained, the first two endings are the result of aborting the main path through the game early. Meanwhile, you get the first ending in Hollow Knight if you go and do exactly what you are supposed to do, and the other two endings are for doing extra. There is one issue though: the first ending in Hollow Knight SUCKS. I swear it's one of the worst endings I've ever seen in modern commercial game, not only is the outcome unsatisfactory for our characters, but it's just short and feels like it doesn't actually resolve anything. It's the second ending that feels canonical, and that you need to actually get to for the game to feel complete. This is where the issue comes in. To get the best ending in Bloodstained, you pretty much just have to finish exploring the castle, and everything else will fall into place as long as you take advantage of what you were told along the way. That's not the case in Hollow Knight, where I feel they were trying to find an excuse to force player to hit all the important lore spots, but it never really came together in a meaningful way. Half of it is reasonable, where you need the shade cloak to explore through Queen's Garden so you can get half of the kingsoul. The Pale King's half though, is kinda ridiculous. The first issue is getting to the White Palace, which requires using an ability that isn't used anywhere else in a specific location. The bigger issue than finding the White Palace though is getting that ability. For reasons I don't understand, they decided to make it the final upgrade that you get from collecting dream essence, when I think it would make more sense to include at least one optional upgrade past it instead of just having the seer disintegrate. The larger issue though is what it takes to get that point. The game points to two sources of dream essence, warrior dreams and whispering roots, and they contain enough essence to get all the upgrades EXCEPT the awakened dream nail. For the final bit of essence, you're expected to beat one of the champions, most of which are harder than the tyrant lord so it brings into question of what's the point of even including the queens path. The Hidden Dreams updated added some somewhat more reasonable alternative champions to get this final bit of essence from, but they have the same issue of the other champions in that not only are they hard to beat, but they are also hard to find. It's not that they are actually hard to find if you know to look for them, but as far as I'm aware the game gives you know hints that these bosses even exist, and they are all located in isolated areas that you already visited and would have no reason to revisit unless you're specifically looking for the champions. The Hidden Dreams ones are even worse in this regard, as you can be locked out of one if you miss something much earlier in the game, while the other requires a trigger completely unrelated to the character to appear, and is located in a secret area which is the one region I know of that requires desolate dive to access without any sort of visual cue. The real problem though comes once you actually get to the White Palace though, which is this seemingly never ending platform section that is FAR harder than anything before it, feeling more like you're playing Super Meat Boy than Hollow Knight. It's one thing if was just an optional challenge like the Path of Pain that it also contains, but I find the fact you need to beat it to get a decent ending to unreasonable, the game doesn't even do anything to prepare you for it. The only reason I got through it was with an optional charm, Hive Blood, whose use involves a lot of just sitting around and waiting and it is so tedious. I wonder if the White Palace feels some out of place specifically because it was a stretch goal that happened to be part of the main quest instead of a side quest like the colosseum is. Maybe it would have been even harder, but I feel like the whole ordeal would have at least made more sense if the abyss was actually completed as originally planned. The final ending doesn't have the same weight the second one does, but it's even more ridiculous. For unknown reasons, they decided to make the sole reward of boss rush side quest to be getting this final ending, and then center the entire ending around this boss rush mode, and it's just weird. What makes it absurd though is what it takes to actually get the ending, which is beating the Pantheon of Hallownest. It's hard enough to unlock as it requires clearing all the other Pantheons, but the real issue with it isn't that it's hard, it's that it's LONG. To get the hard part of the Pantheon, the player needs to spend like 20 minutes fighting all of the bosses that they've already mastered on the previous pantheons, and if they die they need to restart the entire thing. Because the ending is so hard it's like 20 minutes wasted each failed attempt, and that's just not worth it for most people. The worst part is the ending ends in a bit of cliffhanger, letting people to believe it was sequel bait, in turn frustrating countless player's trying to avoid spoilers who fruitlessly beat themselves against this ridiculous challenge. Bloodstained has it's superbosses too, but those are just additional challenges, not being required to get what seems to be an important ending. To get that you just need to be beat the game. In conclusion, I preferred Bloodstain's save and map systems, found it did a better job at handling money, had more combat options and more interesting traversal items, had more useful upgrades to health, magic, and damage, has more useful alternative game modes, and has more reasonable conditions for getting the good endings. While I'm not saying these are the only things Bloodstained did better, I do think Hollow Knight is better in most other aspects, including graphics, story, bosses and enemies, and sound and level design, and these aspects are considered to be more essential. I will not argue why I think Hollow Knight does this better people seem to generally be in agreement to this, and I've already written well more than enough. I'd like to hear any differing opinions, but again, I recommend only reading the sections you're interested in discussing and not the entire essay.
You may have heard about off-shore tax havens of questionable legality where wealthy people invest their money in legal "grey zones" and don't pay any tax, as featured for example, in Netflix's drama, The Laundromat. The reality is that the Government of Canada offers 100% tax-free investing throughout your life, with unlimited withdrawals of your contributions and profits, and no limits on how much you can make tax-free. There is also nothing to report to the Canada Revenue Agency. Although Britain has a comparable program, Canada is the only country in the world that offers tax-free investing with this level of power and flexibility. Thank you fellow Redditors for the wonderful Gold Award and Today I Learned Award! (Unrelated but Important Note: I put a link at the bottom for my margin account explainer. Many people are interested in margin trading but don't understand the math behind margin accounts and cannot find an explanation. If you want to do margin, but don't know how, click on the link.) As a Gen-Xer, I wrote this post with Millennials in mind, many of whom are getting interested in investing in ETFs, individual stocks, and also my personal favourite, options. Your generation is uniquely positioned to take advantage of this extremely powerful program at a relatively young age. But whether you're in your 20's or your 90's, read on! Are TFSAs important? In 2020 Canadians have almost 1 trillion dollars saved up in their TFSAs, so if that doesn't prove that pennies add up to dollars, I don't know what does. The TFSA truly is the Great Canadian Tax Shelter. I will periodically be checking this and adding issues as they arise, to this post. I really appreciate that people are finding this useful. As this post is now fairly complete from a basic mechanics point of view, and some questions are already answered in this post, please be advised that at this stage I cannot respond to questions that are already covered here. If I do not respond to your post, check this post as I may have added the answer to the FAQs at the bottom.
How to Invest in Stocks
A lot of people get really excited - for good reason - when they discover that the TFSA allows you to invest in stocks, tax free. I get questions about which stocks to buy. I have made some comments about that throughout this post, however; I can't comprehensively answer that question. Having said that, though, if you're interested in picking your own stocks and want to learn how, I recommmend starting with the following videos: The first is by Peter Lynch, a famous American investor in the 80's who wrote some well-respected books for the general public, like "One Up on Wall Street." The advice he gives is always valid, always works, and that never changes, even with 2020's technology, companies and AI: https://www.youtube.com/watch?v=cRMpgaBv-U4&t=2256s The second is a recording of a university lecture given by investment legend Warren Buffett, who expounds on the same principles: https://www.youtube.com/watch?v=2MHIcabnjrA Please note that I have no connection to whomever posted the videos.
TFSAs were introduced in 2009 by Stephen Harper's government, to encourage Canadians to save. The effect of the TFSA is that ordinary Canadians don't pay any income or capital gains tax on their securities investments. Initial uptake was slow as the contribution rules take some getting used to, but over time the program became a smash hit with Canadians. There are about 20 million Canadians with TFSAs, so the uptake is about 70%- 80% (as you have to be the age of majority in your province/territory to open a TFSA).
Eligibility to Open a TFSA
You must be a Canadian resident with a valid Social Insurance Number to open a TFSA. You must be at the voting age in the province in which you reside in order to open a TFSA, however contribution room begins to accumulate from the year in which you turned 18. You do not have to file a tax return to open a TFSA. You do not need to be a Canadian citizen to open and contribute to a TFSA. No minimum balance is required to open a TFSA.
Where you Can Open a TFSA
There are hundreds of financial institutions in Canada that offer the TFSA. There is only one kind of TFSA; however, different institutions offer a different range of financial products. Here are some examples:
The Canadian big 5 bank branches and most other financial institutions offer a TFSA that allows you to buy mutual funds, hold cash, GICs, term deposits, and possibly ETFs. This is a good choice if you want guaranteed returns or diversified investing.
There are a number of on-line banks such as Tangerine, Simplii Financial, Oaken Financial, and many more that offer the TFSA.
The discount DIY brokerage arms of the big 5 banks give you more choices, including stocks, warrants, bonds and options. There are also standalone brokers like IBKR Canada, Questrade, Qtrade, and Virtual Brokers, among others, that offer this.
Some brokerages and financial advisors also offer TFSAs that give you these investment choices, in different formats such as:
Traditional brokerage, where a stockbroker invests your money (BMO Nesbitt Burns, RBC Dominion Securities and others)
Financial advisor who will invest your money according to a plan you put together with the advisor (TSI Network and many others)
"Robo" advisors such as Wealthsimple, RBC InvestEase, BMO SmartFolio, or Wealthbar
BMO's AdviceDirect, which is a semi-directed hybrid between standalone DIY investing and fully-advised investing, where you operate on a DIY basis but have access to a registered investment advisor (a live person) who can give you suggetions and advice.
Your TFSA may be covered by either CIFP or CDIC insuranceor both. Ask your bank or broker for details.
What You Can Trade and Invest In
You can trade the following:
GICS, mutual funds, term deposits
individual common and preferred stocks listed on an "approved exchange" which is the TSX, TSX-V, NASDAQ, NYSE, and about 20 other exchanges worldwide, but not the US OTC pink sheets. Many examples, such as Suncor, Linamar, Apple, any of the big banks, and many thousands of others, when you want to buy into an individual company
stock-like securities like REITS, ETFs and ETNs, including 2x and 3x leveraged
gold and silver certificates
cash of many countries (CAD/USD/EUGBP/AUD/NZD/JPY/CHF and many others)
government bills and bonds of most countries, subsovereigns like Canadian provincial bills and bonds, and most corporations
options that trade on the Montreal Exchange or various options exchanges in the USA and the rest of the word (see FAQ for details)
gold, silver bullion certificates
shares in certain private companies -- but consult your tax advisor on this
What You Cannot Trade
You cannot trade:
commodity futures contracts
option spread positions (see FAQ for details)
anything that requires a margin account, meaning, a special kind of account that allows you to borrow money directly from the broker against the assets you have in your account and the assets you intend to buy.
crypto (although there exist crypto ETNs that you can buy)
Again, if it requires a margin account, it's out. You cannot buy on margin in a TFSA. Nothing stopping you from borrowing money from other sources as long as you stay within your contribution limits, but you can't trade on margin in a TFSA. You can of course trade long puts and calls which give you leverage.
Rules for Contribution Room
Starting at 18 you get a certain amount of contribution room. According to the CRA: You will accumulate TFSA contribution room for each year even if you do not file an Income Tax and Benefit Return or open a TFSA. The annual TFSA dollar limit for the years 2009 to2012 was $5,000. The annual TFSA dollar limit for the years 2013 and 2014 was $5,500. The annual TFSA dollar limit for the year 2015 was $10,000. The annual TFSA dollar limit for the years 2016 to 2018 was $5,500. The annual TFSA dollar limit for the year 2019 is $6,000. The TFSA annual room limit will be indexed to inflation and rounded to the nearest $500. Investment income earned by, and changes in the value of TFSA investments will not affect your TFSA contribution room for the current or future years. https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/tax-free-savings-account/contributions.html If you don't use the room, it accumulates indefinitely. Trades you make in a TFSA are truly tax free. But you cannot claim the dividend tax credit and you cannot claim losses in a TFSA against capital gains whether inside or outside of the TFSA. So do make money and don't lose money in a TFSA. You are stuck with the 15% withholding tax on U.S. dividend distributions unlike the RRSP, due to U.S. tax rules, but you do not pay any capital gains on sale of U.S. shares. You can withdraw *both* contributions *and* capital gains, no matter how much, at any time, without penalty. The amount of the withdrawal (contributions+gains) converts into contribution room in the *next* calendar year. So if you put the withdrawn funds back in the same calendar year you take them out, that burns up your total accumulated contribution room to the extent of the amount that you re-contribute in the same calendar year.
E.g. Say you turned 18 in 2016 in Alberta where the age of majority is 18. It is now sometime in 2020. You have never contributed to a TFSA. You now have $5,500+$5,500+$5,500+$6,000+$6,000 = $28,500 of room in 2020. In 2020 you manage to put $20,000 in to your TFSA and you buy Canadian Megacorp common shares. You now have $8,500 of room remaining in 2020. Sometime in 2021 - it doesn't matter when in 2021 - your shares go to $100K due to the success of the Canadian Megacorp. You also have $6,000 worth of room for 2021 as set by the government. You therefore have $8,500 carried over from 2020+$6,000 = $14,500 of room in 2021. In 2021 you sell the shares and pull out the $100K. This amount is tax-free and does not even have to be reported. You can do whatever you want with it. But: if you put it back in 2021 you will over-contribute by $100,000 - $14,500 = $85,500 and incur a penalty. But if you wait until 2022 you will have $14,500 unused contribution room carried forward from 2021, another $6,000 for 2022, and $100,000 carried forward from the withdrawal 2021, so in 2022 you will have $14,500+$6,000+$100,000 = $120,500 of contribution room. This means that if you choose, you can put the $100,000 back in in 2022 tax-free and still have $20,500 left over. If you do not put the money back in 2021, then in 2022 you will have $120,500+$6,000 = $126,500 of contribution room. There is no age limit on how old you can be to contribute, no limit on how much money you can make in the TFSA, and if you do not use the room it keeps carrying forward forever. Just remember the following formula: This year's contribution room = (A) unused contribution room carried forward from last year + (B) contribution room provided by the government for this year + (C) total withdrawals from last year. EXAMPLE 1: Say in 2020 you never contributed to a TFSA but you were 18 in 2009. You have $69,500 of unused room (see above) in 2020 which accumulated from 2009-2020. In 2020 you contribute $50,000, leaving $19,500 contribution room unused for 2020. You buy $50,000 worth of stock. The next day, also in 2020, the stock doubles and it's worth $100,000. Also in 2020 you sell the stock and withdraw $100,000, tax-free. You continue to trade stocks within your TFSA, and hopefully grow your TFSA in 2020, but you make no further contributions or withdrawals in 2020. The question is, How much room will you have in 2021? Answer: In the year 2021, the following applies: (A) Unused contribution room carried forward from last year, 2020: $19,500 (B) Contribution room provided by government for this year, 2021: $6,000 (C) Total withdrawals from last year, 2020: $100,000 Total contribution room for 2021 = $19,500+6,000+100,000 = $125,500. EXAMPLE 2: Say between 2020 and 2021 you decided to buy a tax-free car (well you're still stuck with the GST/PST/HST/QST but you get the picture) so you went to the dealer and spent $25,000 of the $100,000 you withdrew in 2020. You now have a car and $75,000 still burning a hole in your pocket. Say in early 2021 you re-contribute the $75,000 you still have left over, to your TFSA. However, in mid-2021 you suddenly need $75,000 because of an emergency so you pull the $75,000 back out. But then a few weeks later, it turns out that for whatever reason you don't need it after all so you decide to put the $75,000 back into the TFSA, also in 2021. You continue to trade inside your TFSA but make no further withdrawals or contributions. How much room will you have in 2022? Answer: In the year 2022, the following applies: (A) Unused contribution room carried forward from last year, 2021: $125,500 - $75,000 - $75,000 = -$24,500. Already you have a problem. You have over-contributed in 2021. You will be assessed a penalty on the over-contribution! (penalty = 1% a month). But if you waited until 2022 to re-contribute the $75,000 you pulled out for the emergency..... In the year 2022, the following would apply: (A) Unused contribution room carried forward from last year, 2021: $125,500 -$75,000 =$50,500. (B) Contribution room provided by government for this year, 2022: $6,000 (C) Total withdrawals from last year, 2020: $75,000 Total contribution room for 2022 = $50,500 + $6,000 + $75,000 = $131,500. ...And...re-contributing that $75,000 that was left over from your 2021 emergency that didn't materialize, you still have $131,500-$75,000 = $56,500 of contribution room left in 2022. For a more comprehensive discussion, please see the CRA info link below.
FAQs That Have Arisen in the Discussion and Other Potential Questions:
Equity and ETF/ETN Options in a TFSA: can I get leverage? Yes. You can buy puts and calls in your TFSA and you only need to have the cash to pay the premium and broker commissions. Example: if XYZ is trading at $70, and you want to buy the $90 call with 6 months to expiration, and the call is trading at $2.50, you only need to have $250 in your account, per option contract, and if you are dealing with BMO IL for example you need $9.95 + $1.25/contract which is what they charge in commission. Of course, any profits on closing your position are tax-free. You only need the full value of the strike in your account if you want to exercise your option instead of selling it. Please note: this is not meant to be an options tutorial; see the Montreal Exchange's Equity Options Reference Manual if you have questions on how options work.
Equity and ETF/ETN Options in a TFSA: what is ok and not ok? Long puts and calls are allowed. Covered calls are allowed, but cash-secured puts are not allowed. All other option trades are also not allowed. Basically the rule is, if the trade is not a covered call and it either requires being short an option or short the stock, you can't do it in a TFSA.
Live in a province where the voting age is 19 so I can't open a TFSA until I'm 19, when does my contribution room begin? Your contribution room begins to accumulate at 18, so if you live in province where the age of majority is 19, you'll get the room carried forward from the year you turned 18.
If I turn 18 on December 31, do I get the contribution room just for that day or for the whole year? The whole year.
Do commissions paid on share transactions count as withdrawals? Unfortunately, no. If you contribute $2,000 cash and you buy $1,975 worth of stock and pay $25 in commission, the $25 does not count as a withdrawal. It is the same as if you lost money in the TFSA.
How much room do I have? If your broker records are complete, you can do a spreadsheet. The other thing you can do is call the CRA and they will tell you.
TFSATFSA direct transfer from one institution to another: this has no impact on your contributions or withdrawals as it counts as neither.
More than 1 TFSA: you can have as many as you want but your total contribution room does not increase or decrease depending on how many accounts you have.
Withdrawals that convert into contribution room in the next year. Do they carry forward indefinitely if not used in the next year? Answer :yes.
Do I have to declare my profits, withdrawals and contributions? No. Your bank or broker interfaces directly with the CRA on this. There are no declarations to make.
Risky investments - smart? In a TFSA you want always to make money, because you pay no tax, and you want never to lose money, because you cannot claim the loss against your income from your job. If in year X you have $5,000 of contribution room and put it into a TFSA and buy Canadian Speculative Corp. and due to the failure of the Canadian Speculative Corp. it goes to zero, two things happen. One, you burn up that contribution room and you have to wait until next year for the government to give you more room. Two, you can't claim the $5,000 loss against your employment income or investment income or capital gains like you could in a non-registered account. So remember Buffett's rule #1: Do not lose money. Rule #2 being don't forget the first rule. TFSA's are absolutely tailor-made for Graham-Buffett value investing or for diversified ETF or mutual fund investing, but you don't want to buy a lot of small specs because you don't get the tax loss.
Moving to/from Canada/residency. You must be a resident of Canada and 18 years old with a valid SIN to open a TFSA. Consult your tax advisor on whether your circumstances make you a resident for tax purposes. Since 2009, your TFSA contribution room accumulates every year, if at any time in the calendar year you are 18 years of age or older and a resident of Canada. Note: If you move to another country, you can STILL trade your TFSA online from your other country and keep making money within the account tax-free. You can withdraw money and Canada will not tax you. But you have to get tax advice in your country as to what they do. There restrictions on contributions for non-residents. See "non residents of Canada:" https://www.canada.ca/content/dam/cra-arc/formspubs/pub/rc4466/rc4466-19e.pdf
The U.S. withholding tax. Dividends paid by U.S.-domiciled companies are subject to a 15% U.S. withholding tax. Your broker does this automatically at the time of the dividend payment. So if your stock pays a $100 USD dividend, you only get $85 USD in your broker account and in your statement the broker will have a note saying 15% U.S. withholding tax. I do not know under what circumstances if any it is possible to get the withheld amount. Normally it is not, but consult a tax professional.
The U.S. withholding tax does not apply to capital gains. So if you buy $5,000 USD worth of Apple and sell it for $7,000 USD, you get the full $2,000 USD gain automatically.
Tax-Free Leverage. Leverage in the TFSA is effectively equal to your tax rate * the capital gains inclusion rate because you're not paying tax. So if you're paying 25% on average in income tax, and the capital gains contribution rate is 50%, the TFSA is like having 12.5%, no margin call leverage costing you 0% and that also doesn't magnify your losses.
Margin accounts. These accounts allow you to borrow money from your broker to buy stocks. TFSAs are not margin accounts. Nothing stopping you from borrowing from other sources (such as borrowing cash against your stocks in an actual margin account, or borrowing cash against your house in a HELOC or borrowing cash against your promise to pay it back as in a personal LOC) to fund a TFSA if that is your decision, bearing in mind the risks, but a TFSA is not a margin account. Consider options if you want leverage that you can use in a TFSA, without borrowing money.
Dividend Tax Credit on Canadian Companies. Remember, dividends paid into the TFSA are not eligible to be claimed for the credit, on the rationale that you already got a tax break.
FX risk. The CRA allows you to contribute and withdraw foreign currency from the TFSA but the contribution/withdrawal accounting is done in CAD. So if you contribute $10,000 USD into your TFSA and withdraw $15,000 USD, and the CAD is trading at 70 cents USD when you contribute and $80 cents USD when you withdraw, the CRA will treat it as if you contributed $14,285.71 CAD and withdrew $18,75.00 CAD.
OTC (over-the-counter stocks). You can only buy stocks if they are listed on an approved exchange ("approved exchange" = TSX, TSX-V, NYSE, NASDAQ and about 25 or so others). The U.S. pink sheets "over-the-counter" market is an example of a place where you can buy stocks, that is not an approved exchange, therefore you can't buy these penny stocks. I have however read that the CRA make an exception for a stock traded over the counter if it has a dual listing on an approved exchange. You should check that with a tax lawyer or accountant though.
The RRSP. This is another great tax shelter. Tax shelters in Canada are either deferrals or in a few cases - such as the TFSA - outright tax breaks, The RRSP is an example of a deferral. The RRSP allows you to deduct your contributions from your income, which the TFSA does not allow. This deduction is a huge advantage if you earn a lot of money. The RRSP has tax consequences for withdrawing money whereas the TFSA does not. Withdrawals from the RRSP are taxable whereas they are obviously not in a TFSA. You probably want to start out with a TFSA and maintain and grow that all your life. It is a good idea to start contributing to an RRSP when you start working because you get the tax deduction, and then you can use the amount of the deduction to contribute to your TFSA. There are certain rules that claw back your annual contribution room into an RRSP if you contribute to a pension. See your tax advisor.
Pensions. If I contribute to a pension does that claw back my TFSA contribution room or otherwise affect my TFSA in any way? Answer: No.
The $10K contribution limit for 2015. This was PM Harper's pledge. In 2015 the Conservative government changed the rules to make the annual government allowance $10,000 per year forever. Note: withdrawals still converted into contribution room in the following year - that did not change. When the Liberals came into power they switched the program back for 2016 to the original Harper rules and have kept the original Harper rules since then. That is why there is the $10,000 anomaly of 2015. The original Harper rules (which, again, are in effect now) called for $500 increments to the annual government allowance as and when required to keep up with inflation, based on the BofC's Consumer Price Index (CPI). Under the new Harper rules, it would have been $10,000 flat forever. Which you prefer depends on your politics but the TFSA program is massively popular with Canadians. Assuming 1.6% annual CPI inflation then the annual contribution room will hit $10,000 in 2052 under the present rules. Note: the Bank of Canada does an excellent and informative job of explaining inflation and the CPI at their website.
Losses in a TFSA - you cannot claim a loss in a TFSA against income. So in a TFSA you always want to make money and never want to lose money. A few ppl here have asked if you are losing money on your position in a TFSA can you transfer it in-kind to a cash account and claim the loss. I would expect no as I cannot see how in view of the fact that TFSA losses can't be claimed, that the adjusted cost base would somehow be the cost paid in the TFSA. But I'm not a tax lawyeaccountant. You should consult a tax professional.
Transfers in-kind to the TFSA and the the superficial loss rule. You can transfer securities (shares etc.) "in-kind," meaning, directly, from an unregistered account to the TFSA. If you do that, the CRA considers that you "disposed" of, meaning, equivalent to having sold, the shares in the unregistered account and then re-purchased them at the same price in the TFSA. The CRA considers that you did this even though the broker transfers the shares directly in the the TFSA. The superficial loss rule, which means that you cannot claim a loss for a security re-purchased within 30 days of sale, applies. So if you buy something for $20 in your unregistered account, and it's trading for $25 when you transfer it in-kind into the TFSA, then you have a deemed disposition with a capital gain of $5. But it doesn't work the other way around due to the superficial loss rule. If you buy it for $20 in the unregistered account, and it's trading at $15 when you transfer it in-kind into the TFSA, the superficial loss rule prevents you from claiming the loss because it is treated as having been sold in the unregistered account and immediately bought back in the TFSA.
Day trading/swing trading. It is possible for the CRA to try to tax your TFSA on the basis of "advantage." The one reported decision I'm aware of (emphasis on I'm aware of) is from B.C. where a woman was doing "swap transactions" in her TFSA which were not explicitly disallowed but the court rules that they were an "advantage" in certain years and liable to taxation. Swaps were subsequently banned. I'm not sure what a swap is exactly but it's not that someone who is simply making contributions according to the above rules would run afoul of. The CRA from what I understand doesn't care how much money you make in the TFSA, they care how you made it. So if you're logged on to your broker 40 hours a week and trading all day every day they might take the position that you found a way to work a job 40 hours a week and not pay any tax on the money you make, which they would argue is an "advantage," although there are arguments against that. This is not legal advice, just information.
The U.S. Roth IRA. This is a U.S. retirement savings tax shelter that is superficially similar to the TFSA but it has a number of limitations, including lack of cumulative contribution room, no ability for withdrawals to convert into contribution room in the following year, complex rules on who is eligible to contribute, limits on how much you can invest based on your income, income cutoffs on whether you can even use the Roth IRA at all, age limits that govern when and to what extent you can use it, and strict restrictions on reasons to withdraw funds prior to retirement (withdrawals prior to retirement can only be used to pay for private medical insurance, unpaid medical bills, adoption/childbirth expenses, certain educational expenses). The TFSA is totally unlike the Roth IRA in that it has none of these restrictions, therefore, the Roth IRA is not in any reasonable sense a valid comparison. The TFSA was modeled after the U.K. Investment Savings Account, which is the only comparable program to the TFSA.
The UK Investment Savings Account. This is what the TFSA was based off of. Main difference is that the UK uses a 20,000 pound annual contribution allowance, use-it-or-lose-it. There are several different flavours of ISA, and some do have a limited recontribution feature but not to the extent of the TFSA.
Is it smart to overcontribute to buy a really hot stock and just pay the 1% a month overcontribution penalty? If the CRA believes you made the overcontribution deliberately the penalty is 100% of the gains on the overcontribution, meaning, you can keep the overcontribution, or the loss, but the CRA takes the profit.
Speculative stocks-- are they ok? There is no such thing as a "speculative stock." That term is not used by the CRA. Either the stock trades on an approved exchange or it doesn't. So if a really blue chip stock, the most stable company in the world, trades on an exchange that is not approved, you can't buy it in a TFSA. If a really speculative gold mining stock in Busang, Indonesia that has gone through the roof due to reports of enormous amounts of gold, but their geologist somehow just mysteriously fell out of a helicopter into the jungle and maybe there's no gold there at all, but it trades on an approved exchange, it is fine to buy it in a TFSA. Of course the risk of whether it turns out to be a good investment or not, is on you.
Remember, you're working for your money anyway, so if you can get free money from the government -- you should take it! Follow the rules because Canadians have ended up with a tax bill for not understanding the TFSA rules. Appreciate the feedback everyone. Glad this basic post has been useful for many. The CRA does a good job of explaining TFSAs in detail at https://www.canada.ca/content/dam/cra-arc/formspubs/pub/rc4466/rc4466-19e.pdf
Unrelated but of Interest: The Margin Account
Note: if you are interested in how margin accounts work, I refer you to my post on margin accounts, where I use a straightforward explanation of the math behind margin accounts to try and give readers the confidence that they understand this powerful leveraging tool.
Long Thesis - Progyny - 100% upside - High-growth, profitable company is the only differentiated provider in a large, growing, and underserved market. PGNY’s high-touch, seamless offering helps them stand out against large insurance carriers.
Link to my research report on PGNY Summary High-growth, profitable company is the only differentiated provider in a large, growing, and underserved market. PGNY’s high-touch, seamless offering helps them stand out against large insurance carriers. Covid-19 has shown the importance of benefits for employees and will continue to be the key differentiator for those thinking of changing jobs. According to RMANJ (Reproductive Medicine Associates of New Jersey), 68% of people would switch jobs for fertility benefits. For employers, Progyny reduces costs by including the latest cutting-edge technology in one packaged price, thereby lowering the risk of multiples and increasing the likelihood of pregnancy, keeping employees happy with an integrated, data-driven, concierge service partnering with a selective group of fertility doctors. Upside potential is 2x current price in the next 18 months. Overview Progyny Inc. (Nasdaq: PGNY), “PGNY” or the “Company”, based in New York, NY, is the leading independent fertility and family building benefits manager. Progyny serves as a value-add benefits manager sold to employers who want to improve their benefits coverage and retain and attract the best employees. Progyny offers a comprehensive solution and is truly disrupting the fertility industry. There is no standard fertility cycle, but the below is a good approximation of possible workflows: https://preview.redd.it/7aip8pna9zi51.png?width=941&format=png&auto=webp&s=7ef868a67eae10534bac254ab58fb3d4295aef37
Patient is referred to fertility center for evaluation for Assisted Reproductive Technology (“ART”) procedures, including in-vitro fertilization (“IVF “) and intrauterine insemination (“IUI”). Both can be aided by pharmaceuticals that stimulate egg production in the female patient. IVF involves the fertilization of the egg and sperm in the lab, while IUI is direct injection of the sperm sample into the uterus. Often, IUI is done first as it is less expensive. As success rates of IVF have increased, IUI utilization will likely fall.
Sperm washing is the separation of the sperm from the semen sample for embryo creation, and it enhances the freezing capacity of the sperm. Typically, a wash solution is added to the sample and then a centrifuge is used to undergo separation. This is done in both IUI and IVF.
Some OB/GYN platforms are pursuing vertical integration and offering fertility services directly. The OB would need to be credentialed at the lab / procedure center.
Specialty pharmacy arranges delivery of temperature sensitive Rx. Drug regimens include ovarian stimulation to increase the number of eggs or hormone manipulation to better time fertility cycles, among others.
Oocyte retrieval / aspiration is done under deep-sedation anesthesia in a procedure room, typically in the attached IVF lab. Transfer cycle implantation is done using ultrasound guidance without anesthesia. (Anecdotally, we have been told that only REIs can perform an egg retrieval. We have not been able to validate this).
Many clinics house frozen embryos on-site, while some clinics contract with 3rd parties to manage the process. During an IVF cycle, embryos are created from all available eggs. Single-embryo transfer (“SET”) is becoming the norm, which means that multiple embryos are then cryopreserved to use in the future. A fertility preservation cycle ends here with a female storing eggs for long-term usage (e.g. a woman in her young 20s deciding to freeze her eggs for starting a family later).
Common nomenclature refers to an IVF cycle or an IVF cycle with Intracytoplasmic sperm injection (“ICSI”). From a technical perspective, ICSI and IVF are different forms of embryo fertilization within an ART cycle.
ART clinics are frequently offering ancillary services such as embryo / egg adoption or surrogacy services. More frequently, there are independent companies that help with the adoption process and finding surrogates.
ART procedures are broken into two different types of cycles: a banking cycle is the process by which eggs are gathered, embryos are created and then transferred to cryopreservation. A transfer cycle is typically the transfer of a thawed embryo to the female for potential pregnancy. If a pregnancy does not occur, another transfer cycle ensues. Many REIs are moving towards a banking cycle, freezing all embryos, then transfer cycles until embryos are exhausted or a birth occurs. If a birth occurs with the first embryo, patients can keep their embryos for future pregnancy attempts, donate the embryos to a donation center, or request the destruction of the embryos.
The Company started as Auxogen Biosciences, an egg-freezing provider before changing business models to focus on providing a full-range of fertility benefits. In 2016, they launched with their first 5 employer clients and 110,000 members. As of June 30, 2020, the Company provided benefits to 134 employers and ~2.2 million members, year over year growth of 63%. 134 employers is less than 2% of the total addressable market of “approximately 8,000 self-insured employers in the United States (excluding quasi-governmental entities, such as universities and school systems, and labor unions) who have a minimum of 1,000 employees and represent approximately 69 million potential covered lives in total. Our current member base of 2.1 million represents only 3% of our total market opportunity.” The utilization rate for all Progyny members was less than 1% in 2019, offering significant leverageable upside as the topic of fertility becomes less taboo.
Fertility has historically been a process fraught one-sided knowledge, even more so than the typical physician procedure. Despite the increased availability of information on the internet, women who undergo fertility treatments have often described the experience as “byzantine” and “chaotic”. Outdated treatment models without the latest technology (or the latest tech offered as expensive a la carte options) continue to be the norm at traditional insurance providers as well as clinics that do not accept insurance. Progyny’s differentiated approach, including a high-touch concierge level of service for patients and data-driven decision making at the clinical level, has led to an NPS of 72 for fertility benefits and 80 for the integrated, optional pharmacy benefit. Typically, fertility benefits offered by large insurance carriers are add-ons to existing coverage subject to a lifetime maximum while simultaneously requiring physicians to try IUI 3 – 6 times before authorizing IVF. The success rate of IUI, also known as artificial insemination, is typically less than 10%, even when performed with medication. As mentioned in Progyny’s IPO “A patient with mandated fertility step therapy protocol may be required to undergo three to six cycles of IUI, which has an average success rate range of 5% to 15%, takes place over three to six months and can cost up to $4,000 per cycle (or an aggregate of approximately $12,000 to $24,000), according to FertilityIQ. Multiple rounds of mandated IUI is likely to exhaust the patient's lifetime dollar maximum fertility benefits and waste valuable time before more effective IVF treatment can be begun.” Success Rates for IVF IVF success rates vary greatly by age but were 49% on average for women younger than 35. The graph below shows success rates by all clinics by age group for those that did at least 10 cycles in the specific age group. As an example, for those in the ages 35 – 37, out of 456 available clinics, 425 performed at least 10 cycles with a median success rate of 39.7%. https://preview.redd.it/d2l5dtw89zi51.png?width=4990&format=png&auto=webp&s=5ff2ab9948b94419558a27ac861d4e498dce6713 Progyny’s Smart Cycle is the proprietary method the company has chosen as a “currency” for fertility benefits. As opposed to a traditional fee-for-service model with step-up methods, employers may choose to provide between 2 and unlimited Smart Cycles to employees. This enables employees to choose the provider’s best method. Included in the Smart Cycle, and another indicator of the Company’s forward-thinking methodology, are treatment options that deliver better outcomes (PGS, ICSI, multiple embryo freezing with future implantations). https://preview.redd.it/np577a389zi51.png?width=734&format=png&auto=webp&s=c061a2b24c8515890ba204479b4677893dabf755 As detailed in the chart above, a patient could undergo an IVF cycle that freezes all embryos (3/4 of a Smart Cycle), then transfer 5 frozen embryos (1/4 cycle each; each transfer would occur at peak ovulation, which would take at least 5 months) and use only 2 Smart Cycles. Alternatively, if the patient froze all embryos and got pregnant on the first embryo transfer, they would only use one cycle. Before advances in vitrification (freezing), patients could not be sure that an embryo created in the lab and frozen for later use would be viable, so using only one embryo at a time seemed wasteful. Now, as freezing technology has advanced, undergoing one pharmaceutical regime, one oocyte collection procedure, creating as many embryos as possible, and then transferring one embryo back into the uterus while freezing the rest provides the highest ROI. If the first transferred embryo fails to implant or otherwise does not lead to a baby, the patient can simply thaw the next embryo and try implantation again next month. Included in each Smart Cycle is pre-implantation genetic sequencing (“PGS”) on all available embryos and intracytoplasmic sperm injection (“ICSI”). PGS uses next-generation sequencing technology to determine the viability and sex of the embryo while ICSI is a process whereby a sperm is directly inserted into the egg to start fertilization, rather than allowing the sperm to penetrate the egg naturally. ICSI has a slightly higher rate of successful fertilization (as opposed to simply leaving the egg and sperm in the petri dish). Because Progyny’s experience is denominated in cycles of care, not simply dollars, patients and doctors can focus on what procedures offer the best return. 30% of the Company’s existing network of doctors do not accept insurance of any kind, other than Progyny, which speaks to the value that is provided to doctors and employers. For patients not looking to get pregnant, Progyny offers egg freezing as well. Progyny started as an egg-freezing manager, which allows a woman to preserve her fertility and manage her biological clock. As mentioned previously, pregnancy outcomes vary significantly and align closely with the age of the egg. Egg freezing is designed to allow a woman to save her younger eggs until she is ready to start a family. From an employer’s perspective, keeping younger women in the work force for longer is a cost savings. Vitrification technology has improved significantly since “Freeze your eggs, Free Your Career” was the headline on Bloomberg Businesweek in 2014, but we still don’t yet know the pregnancy rates for women who froze their eggs 5 years ago, but early results are promising and on par with IVF rates for women of similar ages now. From a female perspective, the egg freezing process is not an easy one. The patient is still required to inject themselves with stimulation drugs and the egg retrieval process is the same as in the IVF process (under sedation). The same number of days out of work are required. Using the SmartCycle benefit above as an example, the egg freezing process would require ½ of a Smart Cycle. The annual payment required to the clinic is typically included in the benefits package but may require out-of-pocket expenses covered by the employee. Contrary to popular belief, IVF pregnancies do not have a higher rate of multiples (twins, triplets, etc.), rather in order to reduce out of pocket costs, REIs have transferred multiple embryos to the patient, in the hopes of achieving a pregnancy. If you have struggled for years to get pregnant, and the doctor is suggesting that transferring 3 embryos at once is your best chance at success, you are unlikely to complain, nor are you likely to selectively eliminate an implanted embryo because you now have twins. There are several factors that are making it more likely / acceptable to transfer one embryo at a time, enabling Progyny’s success. https://preview.redd.it/48vk9gc69zi51.png?width=953&format=png&auto=webp&s=2c75a2771a1dd9a079074331b317451f076725ca From the Company: “According to a study published in the American Journal of Obstetrics & Gynecology that analyzed the total costs of care over 400,000 deliveries between 2005 and 2010, as adjusted for inflation, the maternity and perinatal healthcare costs attributable to a set of twins are approximately $150,000 on average, more than four times the comparable costs attributable to singleton births of approximately $35,000, and often exceed this average. In the case of triplets, the costs escalate significantly and average $560,000, sometimes extending upwards of $1.0 million.” “Progyny's selective network of high-quality fertility specialists consistently demonstrate a strong adherence to best practices with a substantially higher single embryo transfer rate. As a result, our members experience significantly fewer pregnancies with multiples (e.g., twins or triplets). Multiples are associated with a higher probability of adverse medical conditions for the mother and babies, and as a byproduct, significantly escalate the costs for employers. Our IVF multiples rate is 3.6% compared to the national average of 16.1%. A lower multiples rate is the primary means to achieving lower high-risk maternity and NICU expenses for our clients.” An educated and supported patient leads to better outcomes. Each patient gets a patient care advocate who interacts with a patient, on average, 15x during their usage of fertility benefits - before treatment, during treatment and post-pregnancy. The Company provides phone-based clinical education and support seven days a week and the Company’s proprietary “UnPack It” call allows patients to speak to a licensed pharmacy clinician who describes the medications included in the package (which contains an average of 20 items per cycle), provides instruction on proper medication administration, and ensures that cycles start on time. The Company’s single medication authorization and delivery led to no missed or delayed cycles in 2018. Previous conference calls have made note of the fact that the Company would like to purchase their own specialty pharmacy and own every aspect of that interaction, which should provide a lift to gross margins. This would allow PGNY to manage both the medication and the treatment, leading to decreased cost of fertility drugs. Under larger carrier programs, carriers manage access to treatment, but PBM manages access to medications, which can lead to a delay in cycle commencement. Progyny Rx can only be added to the Progyny fertility benefits solution (not offered without subscription to base fertility benefits) and offers patients a potentially lower cost fertility drug benefit, while streamlining what is often a frustrating part of the consumer experience. The Progyny Rx solution reduces dispensing and delivery times and eliminates the possibility that a cycle does not start on time due to a specialty pharmacy not delivering medication. Progyny bills employers for fertility medication as it is dispensed in accordance with the individual Smart Cycle contract. Progyny Rx was introduced in 2018 and represented only 5% of total revenue in 2018. By June 30, 2020, Progyny Rx represented 28% of total revenue and increased 15% y/y. The growth rate should slow and move more in line with the fertility benefits solution as the existing customer base adds it to their package. Progyny Rx can save employers 5% on spend for typical carrier fertility benefits or 21% of the drug spend. Prior authorization is not required, and the pre-screened network of specialty pharmacies can deliver within 48 hours. Additionally, PGNY has 1-year contracts, as opposed to 3 – 5 years like standard PBMs, but with guaranteed minimums, allowing them to purchase at discounts and pass part of the savings on to employers – another reason the attachment rate is so high. Large, Underpenetrated Addressable Market Total cycle counts are increasing (below, in 000s), including both freezing cycles and intended-pregnancy cycles. Acceleration in cycle volume is likely driven by a declining birth rate as women wait later in life to start a family, resulting in reduced fertility, as well as the number of non-traditional (LGBT and single parents). Conservatively, we believe cycles can double in the next 8 years, a 7% CAGR. https://preview.redd.it/y6y7jb559zi51.png?width=943&format=png&auto=webp&s=6cc5cdde7c6583d8e943d2675ad3b6ae85f818de Progyny believes its addressable market is the $6.7B spent on infertility treatments in 2017, but these numbers could easily understate the available market and potential patients as over 50% of people in the US who are diagnosed as infertile do not seek treatment. Additionally, according to the Company, 35% of its covered universe did not previously have fertility benefits in place previously, meaning there is a growing population of people who are now considering their fertility options. According to Willis Towers, Watson, ~ 55% of employers offered fertility benefits in 2018. A quick review of CDC stats and FertilityIQ shows a significant disparity in outcomes and emotions for those who are seeking treatment. While technology in the embryo lab is improving rapidly and success rates between clinics should be converging, there continue to be significant outliers. Clinics that follow what are now generally accepted procedures (follicle stimulating hormones, a 5-day incubation period and PGS to determine embryo viability) have seen success rates of at least 40%. There continue to be several providers that offer a mini-IVF cycle or natural IVF cycle. Designed to appeal to cost conscious cash payors, the on average $5,000 costs, is simply IVF without prescription drugs or any add-ons such as PGS. However, the success rates are on par with IUI and there is an abundance of patients over 40 using the service, where the success rates are already low. Additionally, success stories at these clinics frequently align with what is perceived as the worst parts of the process: One clinic offering a natural cycle IVF has a rating at FertilityIQ of ~8.0 with 60% of people strongly recommending it. This clinic performed 2,000 cycles in 2018 (the most recently available data from the CDC), making it one of the top 10 most active fertility center in the US. Their success rate for women under 35 was 23%, as opposed to the national average of 50% for all clinics. For women over 43, the average success rate for the most active 40 clinics in this demographic was 5.0% this clinics success rate was 0.4%. The lower success rate is likely due to the lack of pre-cycle drugs and PGS, but the success rate and the average rating is hard to understand. Part of this could be to the customer service provided by the clinic, or the perceived benefit of having to go into the office less often for check-ups when not doing a medication driven cycle. . Reviews from other clinics with high average customer ratings, but low success rates include: - “start of a journey that consisted of multiple IUI’s with numerous medications, but they were not successful.” - After an IVF retrieval, the couple had two viable embryos, both were transferred the next month” - “The couple started with a series of IUI treatments, three in total that were not successful.” - “After a fresh transfer of two embryos, again another unsuccessful cycle”. - “He suggested transferring 2 due to higher implantation rates, but there is increased rate of twins “ Valuation https://preview.redd.it/tqcykjm39zi51.png?width=6358&format=png&auto=webp&s=b63fd53c054ac5cbacaf9ccc734c7e73f0ea3c32 Progyny’s comps have typically been other high-growth companies that went public in the last two years: 1Life Healthcare (ONEM), Accolade (ACCD), Health Catalyst (HCAT), Health Equity (HQY), Livongo (LVGO), Phreesia (PHR), as well as Teladoc (TDOC). Despite revenue growth that outpaces these companies, PGNY’s revenue multiple of 4.4x 2021E revenue is a 40% discount to the peer group median. PNGY’s lower gross margin is likely limiting the multiple. However, Progyny is the one of the few profitable companies in this group and the only one with realistic EBTIDA margins. SG&A leverage is the most likely driver of increased EBITDA and can be achieved by utilizing data to improve clinical outcomes in the future, but primarily by increased productive of the sales reps, including larger employer wins and larger employee utilization. Perhaps the best direct comp is Bright Horizons (BFAM). BFAM offers childcare as a healthcare benefit where employees can use pre-tax dollars to pay for childcare. BFAM offers both onsite childcare centers built to the employer’s specification (owned by the employer and operated by BFAM), as well as shared-site locations that are open to the public and back-up sitter services. Currently, PGNY is trading at 4.4x 2021E Revenue, in-line with BFAM’s 4.3x multiple. I would argue that PGNY should trade significantly higher given the asset-lite business model and higher ROIC. Recent Results Post Covid-19, fertility treatments came back faster than anticipated, combined with disciplined operations, PGNY drove revenue and EBITDA above 2Q2020 consensus estimates. Utilization is still below historical levels, but management’s visibility led to excellent FY21 revenue estimates (consensus is around $555M, a y/y increase of 62%. 2Q2020 revenue increased 15% to $64.6M, and EBITDA increased 18% to $6.5M, primarily driven by SBC as the 15% revenue was not enough to leverage the additional G&A people hired in the last 18 months. The end of the quarter as fertility docs opened their offices back up for remote visits saw better operating margin. Despite the shutdown in fertility clinics during COVID-19, Progyny was able to successfully add several clients. “The significant majority of the clinics in our network chose to adhere to ASRMs guidelines, and our volume of fertility treatments and dispensing of the related medications declined significantly over the latter part of the quarter. . . Through the end of March and into the first half of April, we saw significant reductions in the utilization of the benefit by our members down to as low as 15%, when compared to the early part of Q1 were 15% of what we consider to be normal levels. In April, the New York Department of Health declared that fertility is an essential health service and stated that clinics have the authority to treat their patients and perform procedures during the pandemic. Then on April 24, ASRM updated its guidelines which were reaffirmed on May 11, advising that practices could reopen for all procedures so long as it could be done in a measured way that is safe for patients and staff.” Revenue increased by $33.8 million, 72% in 1Q2020. This increase is primarily due to a $19.0 million, or 47% increase, in revenue from fertility benefits. Additionally, the Company experienced a $14.8 million or 216% increase in revenue from specialty pharmacy. Revenue growth was due to the increase in the number of clients and covered lives. Progyny Rx revenue growth outpaced the fertility benefits revenue since Progyny Rx went live with only a select number of clients on January 1, 2018 and has continued to add both new and existing fertility benefit solution clients since its initial launch. Competition The only true competition is the large insurance companies, but, as mentioned previously, they are not delivering care the same way. WINFertility is the largest manager of fertility insurance benefits on behalf of Anthem, Aetna and Cigna and are not directly involved in the delivery of care. Carrot is a Silicon Valley startup that recently raised $24M in a Series B with several brand name customers (StitchFix, Slack) where they focus on negotiating discounts at fertility clinics for their customers, who then use after-tax dollars from their employers. Risks to Thesis Though there is risk a large carrier may switch to a model similar to Progyny’s, I believe it is unlikely given the established relationships with REIs at the clinic level, the difficulty of managing a more selective network of providers, and the lack of interest shown previously in eliminating the IUI. It is more likely a carrier would acquire Progyny first.
https://preview.redd.it/9evc1yd1kyi51.png?width=1000&format=png&auto=webp&s=60bbf844bcf676e26305e96e8b3f507a04e76673 Social trading is a growing new trend in the cryptocurrency space that has seen it become one of the fastest-growing sub-sectors over the last few years. While forms of social trading such as the commonly known, “copy trading”, have been used predominantly with traditional assets such as stocks and currencies, a new kind of social trading known as “covesting” has been widely adopted by cryptocurrency traders over the past few years and is continuing to grow. We’re breaking down what social trading actually is, how covesting is superior to other forms of social trading that have been around for a number of years, and the integration of covesting into the core of the world's leading multi-asset margin trading platform, PrimeXBT. What is Social Trading? Social trading is the process of multiple traders working together in order to collectively improve their individual profits, with this typically taking a form of resource sharing such as pooling capital, sharing market knowledge, or the trades of experienced traders being copied by less experienced traders. While social trading has been a major part of the traditional asset market for more than a decade, cryptocurrency market has been slow to catch up and for much of the last 10 years of the life of cryptocurrency there were no options available for traders to engage in social trading with cryptocurrencies. In 2020 however, social trading in the crypto market has taken off, and especially over the past few years has grown dramatically in its popularity amongst cryptocurrency traders and investors. How is Covesting Better than Other Forms of Social Trading? Covesting is the newest form of social trading which has been designed to supersede pre-existing methods of social trading that are sub-optimal in comparison. Other forms of social trading, such as copy trading, typically connect traders in a simplified way with inefficiencies being present in the way that resources are shared between copy traders. In comparison, covesting is the most efficient way for traders to be able to work together, by providing a flexible-yet-powerful structure for traders to use in order to interact with each other. Covesting is based around the creation of peer-to-peer investment funds by strategy managers that have a proven track record for being able to generate profits in global markets, while allowing all traders to transparently see the success rates of each fund, their risk profile, and details about the nature of these strategies being used. What is PrimeXBT’s Covesting Module? https://preview.redd.it/166rion3kyi51.png?width=2544&format=png&auto=webp&s=e9cf1adb2e22017fa2d1d5e37ee749c16bb28fd6 Covesting has been used for a number of years in the cryptocurrency market, with it originally being designed by crypto social trading giant, Covesting.io, and through a partnership with advanced multi-asset margin trading platform, PrimeXBT, traders at the latter platform are now also able to use covesting to maximize their profitability. Since April, PrimeXBT’s Covesting module has been running a beta phase with more than $1 million in equity provided by followers during the phase, and ROI’s of up to 360% being generated by the most profitable strategy managers during this period as well. Traders are able to covest on PrimeXBT seamlessly using the module, which has now been fully launched with the successful conclusion of the beta phase, and this allows traders to create strategy-based investment funds, and for followers to access a diverse range of investment opportunities. What is the Roadmap for the Covesting Module? There are a range of proposed features and upgrades that make up the Covesting modules roadmap, with development and release of these features predicted throughout 2020. In order to allow followers to have more granular control over the funds and to be able to better manage their maximum drawdown, individual stop losses for each follower will be available, and are included as one of the main features of the roadmap. Two additional features in the covesting roadmap which will both improve the transparency of the platform and the provision of more detailed data for followers are the creation and integration of additional risk metrics, as well as upgrading the ratings logic of the platform in order to optimize the way the followers are able to assess each fund. How to Get Started with Covesting https://preview.redd.it/umkootz4kyi51.png?width=2218&format=png&auto=webp&s=401c3c815ddf4fe7bc05ac14bc9fd668a1bf8ed2 Any user of PrimeXBT is automatically able to access the full suite of features in the Covesting module, and may do so by clicking on the “Covesting” link in the top tab of the user interface. There are no restrictions or requirements for traders to be able to create their own strategy and begin interacting with potential followers, and to begin building their reputation and ratings as a result of successfully trading in the market. All users PrimeXBT are likewise able to click on the Covesting module’s link in the top bar of the user interface, and then to compare the ratings and performance of a wide range of different strategy managers, being able to seamlessly select a fund to follow with a varying range of investment being possible. In Summary Covesting is a newer and more powerful form of social trading which has grown rapidly in popularity throughout the cryptocurrency market, and is providing traders and investors with unique forms of value and opportunities for generating profit. After a successful beta phase since April, covesting on PrimeXBT is now fully launched and available for all users to create their own strategies and begin seeking investment, or to be able to leverage the knowledge and experience of professional traders in order to reduce risk and increase profit. For more information about PrimeXBT’s Covesting module and how to get started, check out this link.
How to hedge currency fluctuation when investing in foreign assets
I'm new to futures so would appreciate any pointers. If I deposited $10K CAD equivalent then converted it into USD to trade US stocks, and wanted to hedge it against CAD/USD currency fluctuations so it doesn't change value (except for my P&L from trading stocks) when I eventually withdraw it, how would I do this? My thought would be to buy 1 E-Micro CAD/USD future which has a notional value of $10K CAD, then when expiry comes, roll over and add contracts as needed if my portfolio grows until I decide to withdraw the cash at which point I let the contracts settle. Is my thinking correct? And I'm a bit confused about the margin requirements, how much does 1 contract cost to buy? And if I need to sell and roll my contract, would my P&L from the futures contract be all the P&L from the futures contract or proportional to the margin I put down?
Why we need to think more carefully about what money is and how it works
Most of us have overlooked a fundamental problem that is currently causing an insurmountable obstacle to building a fairer and more sustainable world. We are very familiar with the thing in question, but its problematic nature has been hidden from us by a powerful illusion. We think the problem is capitalism, but capitalism is just the logical outcome of aggregate human decisions about how to manage money. The fundamental problem is money itself, or more specifically general purpose money and the international free market which allows you to sell a chunk of rainforest and use the money to buy a soft drink factory. (You can use the same sort of money to sell anything and buy anything, anywhere in the world, and until recently there was no alternative at all. Bitcoin is now an alternative, but is not quite what we are looking for.) The illusion is that because market prices are free, and nobody is forced into a transaction, those prices must be fair – that the exchange is equitable. The truth is that the way the general money globalised free market system works means that even though the prices are freely determined, there is still an unequal flow of natural resources from poor parts of the world to rich parts. This means the poor parts will always remain poor, and resources will continue to accumulate in the large, unsustainable cities in rich countries. In other words, unless we re-invent money, we cannot overturn capitalism, and that means we can't build a sustainable civilisation. Why does this matter? What use is it realising that general purpose money is at the root of our problems when we know that the rich and powerful people who run this world will do everything in their power to prevent the existing world system being reformed? They aren't just going to agree to get rid of general purpose money and economic globalisation. It's like asking them to stop pursuing growth: they can't even imagine how to do it, and don't want to. So how does this offer us a way forwards? Answer: because the two things in question – our monetary system and globalisation – look like being among the first casualties of collapse. Globalisation is already going into reverse (see brexit, Trump's protectionism) and our fiat money system is heading towards a debt/inflation implosion. It looks highly likely that the scenario going forwards will be of increasing monetary and economic chaos. Fiat money systems have collapsed many times before, but never a global system of fiat currencies floating against each other. But regardless of how may fiat currencies collapse, or how high the price of gold goes in dollars, it is not clear what the system would be replaced with. Can we just go back to the gold standard? It is possible, but people will be desperately looking for other solutions, and the people in power might also be getting desperate. So what could replace it? What is needed is a new sort of complementary money system which both (a) addresses the immediate economic problems of people suffering from symptoms of economic and general collapse and (b) provides a long-term framework around which a new sort of economy can emerge – an economy which is adapted to deglobalisation and degrowth. I have been searching for answers to this question for some time, and have now found what I was looking for. It is explained in this recently published academic book, and this paper by the same professor of economic anthropology (Alf Hornborg). The answer is the creation of a new sort of money, but it is critically important exactly how this is done. Local currencies like the Bristol Pound do not challenge globalisation. What we need is a new sort of national currency. This currency would be issued as a UBI, but only usable to buy products and services originating within an adjustable radius. This would enable a new economy to emerge. It actually resists globalisation and promotes the growth of a new sort of economy where sustainability is built on local resources and local economic activity. It would also reverse the trend of population moving from poor rural areas and towns, to cities. It would revitalise the “left behind” parts of the western world, and put the brakes on the relentless flow of natural resources and “embodied cheap labour” from the poor parts of the world to the rich parts. It would set the whole system moving towards a more sustainable and fairer state. This may sound unrealistic, but please give it a chance. I believe it offers a way forwards that can (a) unite disparate factions trying to provoke systemic change, including eco-marxists, greens, posthumanists and anti-globalist supporters of “populist nationalism”. The only people who really stand to lose are the supporters of global big business and the 1%. (b) offers a realistic alternative to a money system heading towards collapse, and to which currently no other realistic alternative is being proposed. In other words, this offers a realistic way forwards not just right now but through much of the early stages of collapse. It is likely to become both politically and economically viable within the forseeable future. It does, though, require some elements of the left to abandon its globalist ideals. It will have to embrace a new sort of nationalism. And it will require various groups who are doing very well out of the current economic system to realise that it is doomed. Here is an FAQ (from the paper).
What is a complementary currency? It is a form of money that can be used alongside regular money. What is the fundamental goal of this proposal? The two most fundamental goals motivating this proposal are to insulate local human subsistence and livelihood from the vicissitudes of national and international economic cycles and financial speculation, and to provide tangible and attractive incentives for people to live and consume more sustainably. It also seeks to provide authorities with a means to employ social security expenditures to channel consumption in sustainable directions and encourage economic diversity and community resilience at the local level. Why should the state administrate the reform? The nation is currently the most encompassing political entity capable of administrating an economic reform of this nature. Ideally it is also subservient to the democratic decisions of its population. The current proposal is envisaged as an option for European nations, but would seem equally advantageous for countries anywhere. If successfully implemented within a particular nation or set of nations, the system can be expected to be emulated by others. Whereas earlier experiments with alternative currencies have generally been local, bottom-up initiatives, a state-supported program offers advantages for long-term success. Rather than an informal, marginal movement connected to particular identities and transient social networks, persisting only as long as the enthusiasm of its founders, the complementary currency advocated here is formalized, efficacious, and lastingly fundamental to everyone's economy. How is local use defined and monitored? The complementary currency (CC) can only be used to purchase goods and services that are produced within a given geographical radius of the point of purchase. This radius can be defined in terms of kilometers of transport, and it can vary between different nations and regions depending on circumstances. A fairly simple way of distinguishing local from non-local commodities would be to label them according to transport distance, much as is currently done regarding, for instance, organic production methods or "fair trade." Such transport certification would of course imply different labelling in different locales. How is the complementary currency distributed? A practical way of organizing distribution would be to provide each citizen with a plastic card which is electronically charged each month with the sum of CC allotted to him or her. Who are included in the category of citizens? A monthly CC is provided to all inhabitants of a nation who have received official residence permits. What does basic income mean? Basic income is distributed without any requirements or duties to be fulfilled by the recipients. The sum of CC paid to an individual each month can be determined in relation to the currency's purchasing power and to the individual's age. The guiding principle should be that the sum provided to each adult should be sufficient to enable basic existence, and that the sum provided for each child should correspond to the additional household expenses it represents. Why would people want to use their CC rather than regular money? As the sum of CC provided each month would correspond to purchases representing a claim on his or her regular budget, the basic income would liberate a part of each person's regular income and thus amount to substantial purchasing power, albeit restricted only to local purchases. The basic income in CC would reduce a person's dependence on wage labor and the risks currently associated with unemployment. It would encourage social cooperation and a vitalization of community. Why would businesses want to accept payment in CC? Business entrepreneurs can be expected to respond rapidly to the radically expanded demand for local products and services, which would provide opportunities for a diverse range of local niche markets. Whether they receive all or only a part of their income in the form of CC, they can choose to use some of it to purchase tax-free local labor or other inputs, and to request to have some of it converted by the authorities to regular currency (see next point). How is conversion of CC into regular currency organized? Entrepreneurs would be granted the right to convert some of their CC into regular currency at exchange rates set by the authorities.The exchange rate between the two currencies can be calibrated so as to compensate the authorities for loss of tax revenue and to balance the in- and outflows of CC to the state. The rate would thus amount to a tool for determining the extent to which the CC is recirculated in the local economy, or returned to the state. This is important in order to avoid inflation in the CC sector. Would there be interest on sums of CC owned or loaned? There would be no interest accruing on a sum of CC, whether a surplus accumulating in an account or a loan extended. How would saving and loaning of CC be organized? The formal granting of credit in CC would be managed by state authorities and follow the principle of full reserve banking, so that quantities of CC loaned would never exceed the quantities saved by the population as a whole. Would the circulation of CC be subjected to taxation? No. Why would authorities want to encourage tax-free local economies? Given the beneficial social and ecological consequences of this reform, it is assumed that nation states will represent the general interests of their electorates and thus promote it. Particularly in a situation with rising fiscal deficits, unemployment, health care, and social security expenditures, the proposed reform would alleviate financial pressure on governments. It would also reduce the rising costs of transport infrastructure, environmental protection, carbon offsetting, and climate change adaptation. In short, the rising costs and diminishing returns on current strategies for economic growth can be expected to encourage politicians to consider proposals such as this, as a means of avoiding escalating debt or even bankruptcy. How would the state's expenditures in CC be financed? As suggested above, much of these expenditures would be balanced by the reduced costs for social security, health care, transport infrastructure, environmental protection, carbon offsetting, and climate change adaptation. As these savings may take time to materialize, however, states can choose to make a proportion of their social security payments (pensions, unemployment insurance, family allowance, etc.) in the form of CC. As between a third and half of some nations' annual budgets are committed to social security, this represents a significant option for financing the reform, requiring no corresponding tax levies. What are the differences between this CC and the many experiments with local currencies? This proposal should not be confused with the notion, or with the practical operation, of local currencies, as it does not imply different currencies in different locales but one national,complementary currency for local use. Nor is it locally initiated and promoted in opposition to theregular currency, but centrally endorsed and administrated as an accepted complement to it. Most importantly, the alternative currency can only be used to purchase products and services originating from within a given geographical range, a restriction which is not implemented in experiments with Local Exchange Trading Systems (LETS). Finally, the CC is provided as a basic income to all residents of a nation, rather than only earned in proportion to the extent to which a person has made him- or herself useful in the local economy. What would the ecological benefits be? The reform would radically reduce the demand for long-distance transport, the production of greenhouse gas emissions, consumption of energy and materials, and losses of foodstuffs through overproduction, storage, and transport. It would increase recycling of nutrients and packaging materials, which means decreasing leakage of nutrients and less garbage. It would reduce agricultural intensification, increase biodiversity, and decrease ecological degradation and vulnerability. What would the societal benefits be? The reform would increase local cooperation, decrease social marginalization and addiction problems, provide more physical exercise, improve psycho-social and physical health, and increase food security and general community resilience. It would decrease the number of traffic accidents, provide fresher and healthier food with less preservatives, and improved contact between producers and consumers. What would the long-term consequences be for the economy? The reform would no doubt generate radical transformations of the economy, as is precisely the intention. There would be a significant shift of dominance from transnational corporations founded on financial speculation and trade in industrially produced foodstuffs, fuels, and other internationally transported goods to locally diverse producers and services geared to sustainable livelihoods. This would be a democratic consequence of consumer power, rather than of legislation. Through a relatively simple transformation of the conditions for market rationality, governments can encourage new and more sustainable patterns of consumer behavior. In contrast to much of the drastic and often traumatic economic change of the past two centuries, these changes would be democratic and sustainable and would improve local and national resilience. Why should society want to encourage people to refrain from formal employment? It is increasingly recognized that full or high employment cannot be a goal in itself, particularly if it implies escalating environmental degradation and energy and material throughput. Well-founded calls are thus currently made for degrowth, i.e. a reduction in the rate of production of goods and services that are conventionally quantified by economists as constitutive of GDP. Whether formal unemployment is the result of financial decline, technological development, or intentional policy for sustainability, no modern nation can be expected to leave its citizens economically unsupported. To subsist on basic income is undoubtedly more edifying than receiving unemployment insurance; the CC system encourages useful community cooperation and creative activities rather than destructive behavior that may damage a person's health. Why should people receive an income without working? As observed above, modern nations will provide for their citizens whether they are formally employed or not. The incentive to find employment should ideally not be propelled only by economic imperatives, but more by the desire to maintain a given identity and to contribute creatively to society. Personal liberty would be enhanced by a reform which makes it possible for people to choose to spend (some of) their time on creative activities that are not remunerated on the formal market, and to accept the tradeoff implied by a somewhat lower economic standard. People can also be expected to devote a greater proportion of their time to community cooperation, earning additional CC, which means that they will contribute more to society – and experience less marginalization – than the currently unemployed. Would savings in CC be inheritable? No. How would transport distances of products and services be controlled? It is reasonable to expect the authorities to establish a special agency for monitoring and controlling transport distances. It seems unlikely that entrepreneurs would attempt to cheat the system by presenting distantly produced goods as locally produced, as we can expect income in regular currency generally to be preferable to income in CC. Such attempts would also entail transport costs which should make the cargo less competitive in relation to genuinely local produce, suggesting that the logic of local market mechanisms would by and large obviate the problem. How would differences in local conditions (such as climate, soils, and urbanism) be dealt with?It is unavoidable that there would be significant variation between different locales in terms of the conditions for producing different kinds of goods. This means that relative local prices in CC for agiven product can be expected to vary from place to place. This may in turn mean that consumption patterns will vary somewhat between locales, which is predictable and not necessarily a problem. Generally speaking, a localization of resource flows can be expected to result in a more diverse pattern of calibration to local resource endowments, as in premodern contexts. The proposed system allows for considerable flexibility in terms of the geographical definition of what is categorized as local, depending on such conditions. In a fertile agricultural region, the radius for local produce may be defined, for instance, as 20 km, whereas in a less fertile or urban area, it may be 50 km. People living in urban centers are faced with a particular challenge. The reform would encourage an increased production of foodstuffs within and in the vicinity of urban areas, which in the long run may also affect urban planning. People might also choose to move to the countryside, where the range of subsistence goods that can be purchased with CC will tend to be greater. In the long run, the reform can be expected to encourage a better fit between the distribution of resources (such as agricultural land) and demography. This is fully in line with the intention of reducing long-distance transports of necessities. What would the consequences be if people converted resources from one currency sphere into products or services sold in another? It seems unfeasible to monitor and regulate the use of distant imports (such as machinery and fuels) in producing produce for local markets, but as production for local markets is remunerated in CC, this should constitute a disincentive to invest regular money in such production processes. Production for local consumption can thus be expected to rely mostly – and increasingly – on local labor and other resource inputs.
To avoid margin closeouts, ensure you have sufficient additional margin in your account at all times to address updated margin requirements. The Commodity Futures Trading Commission (CFTC) limits leverage available to retail forex traders in the United States to 50:1 on major currency pairs and 20:1 for all others. Margin requirements Trading instruments Platforms Deposit and withdrawal Open account Open demo account Trading sessions. MARGIN REQUIREMENTS Trading conditions. PARAMETER ... 77 currency pairs : 79 currency pairs : Commissions : Forex 7.5 USD, Commodity - 10 USD : 10 USD ... Margin Requirement = 692.6 USD. Conclusion Having a good understanding of margin requirements is essential to trading because it directly affects the size and number of trades that you can safely make. The lower your leverage, the higher your margin requirements will be, and you will need to put up more money as collateral to open a position. In the currency world, the margin requirement can commonly be anywhere from 200 (0.02%) to 2,000 (2%) units of the base currency per lot depending on the broker. This represents a leverage of 50 to 1 to 500 to 1 (from 12.5 to 125 times the available leverage in stock trading). The initial margin requirement is the minimum investment you need to make in a foreign currency trading action. Your margin account is very much like your regular bank, where you can deposit and withdraw your capital. All of the margins accounts are closed at the end of the trading day and all gains and losses are assessed into the end balance.
Overcoming New SEBI Margin Rules Margin Requirements Pledging of Shares (Telugu)
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