Selling something at a loss in a non-registered account to offset a gain you already took is one of the few tax moves a regular investor can make on their own, and almost everyone who does it knows to wait 30 days before buying back in. Far fewer people know that the 30 days covers their spouse's account too. The superficial loss rule denies your loss if you, or a person affiliated with you, buys the same or identical property at any point from 30 days before the sale to 30 days after it, and still holds it on day 30. CRA lists your spouse or common-law partner as an affiliated person. So you can sell VFV, an S&P 500 index fund, in your taxable account, wait out the full month without touching it, and still lose the deduction because your spouse's automatic contribution bought VFV in their account two weeks later. Neither of you did anything wrong. When the affiliated person is the one who bought it, the denied loss gets added to their adjusted cost base instead of yours, so it comes back later as a smaller capital gain in their hands. That is fine if you treat the two accounts as one household plan. It is a problem if you were counting on that loss to cancel out a gain you already triggered this year. Buying the identical fund back inside your own RRSP or TFSA within the window does more damage, because a registered plan has no adjusted cost base for the denied loss to attach to. It is gone for good, not just deferred. Personally I don't build my year around tax-loss selling and I don't think most people should. It is an occasional bonus when you happen to be sitting on a loss in a non-registered account, not a strategy worth chasing. But if you are going to do it, the 30 days has to cover every account in the household, including the automatic contributions you set up two years ago and stopped thinking about. Has anyone here had a loss denied, or do you check your spouse's account before you sell?read more
While it stings to see a couple holdings drop their distributions, it is far less painful than imagining an equivalent in a growth etf price drop ... which can snowball out of control with sequence of return retirement problems for the rest of a retirees life. Next year at this exact same time I will retire in September and if something similar were to happen then ... I would have all the hard options available to me as I would if I was a grow and sell investor ... Plus ... I will also the option of just spend what I need from the 30% yield distribution and reinvest the rest as my investment balance grows without missing a lifestyle beat. https://evolveetfs.com/2026/08/an-update-to-bigys-distribution/
I don’t trust any investing strategy I haven’t tested against my own panic. 😅 Turns out there’s science behind that instinct. Kahneman and Tversky found that losses hit us roughly twice as hard as equivalent gains feel good. So when the market drops and you feel like it’s the end of the world? That’s not drama, that’s your nervous system doing exactly what it’s wired to do. Here’s the part nobody tells you: the “perfect” portfolio on paper is worthless if you can’t actually hold it. I’ve watched people build beautifully optimized portfolios, then sell everything the second things got scary, locking in losses right before the recovery. The math was right. The human wasn’t ready. So now I ask a different question before investing in anything: not “what’s the highest return?” but “can I actually sleep at night holding this?” Your body answers that faster than any risk questionnaire. Tight chest, checking your phone every 20 minutes, that’s not weakness, that’s information. 🫀
Cathie Wood's ARK disclosed a $765 million position in SpaceX, bringing the private space company to nearly 5% of the portfolio. This comes as Wood cuts Teradyne by 48%, banking a 347% gain on the semiconductor testing stock. Visit Wood's profile to see her full portfolio and recent trades this last quarter from her 13F filing.
$MRNA just became one of the first companies ever to deliver a positive Phase 3 result for a personalized cancer vaccine. +64% pre-market 🤯🤯 On the other hand, $NBIS just announced plans to raise $4.5 Billion by selling convertible senior notes. $WYFI yesterday, $NBIS today. -8% pre-market.
Pre-market update: 20th Aug 2026 Yesterday had a state rescue in the bond market, a cancer breakthrough that doubled a stock by lunch, a five billion dollar loan at half a percent to the sector everyone spent two days calling a credit crisis, and a presidential declaration of economic war. Let's take them in order. First, the rescue, because Tuesday's carnage got an answer and it came from the government. The Treasury is doubling its long-end buybacks from $2 billion to at least $4 billion per operation starting September 9. The 30 year fell from Tuesday's 5.34% panic high to 5.19%, the 10 year eased to 4.65%, and stocks stabilized with the S&P up 0.24%. When the sovereign starts supporting its own long-dated debt the day after a 19 year yield high, you have learned who blinked first. Note also what the Fed minutes said underneath the relief that several officials were open to a July hike and many see more tightening if inflation sticks above 2%. The bond fire got a hose. The matches are still on the table. Now the story that made the whole day worth watching. Moderna ($MRNA) and Merck ($MRK) announced that their personalized mRNA cancer vaccine, paired with Keytruda, succeeded in a Phase 3 melanoma trial of 1,137 patients, the first late-stage validation of an individualized cancer vaccine in history. The stock roughly doubled, touching a 160% intraday gain and adding about $30 billion of market cap at the peak. Here is why this matters beyond the trade. The vaccine works by sequencing each patient's tumor and having software design a bespoke mRNA instruction set, up to 34 targets per person, manufactured per patient. For three years the AI trade has been racks, leverage and token prices. Yesterday it was a machine reading a tumor and teaching an immune system to kill it. The best advertisement the compute buildout ever got was not a chip. It was a cure. And it came from the most left for dead large cap in the market, which is its own lesson about writing off platforms early. Then the item that speaks directly to this week's argument. Two days after credit default swaps knocked 10% off the neoclouds, Nebius ($NBIS) priced an upsized $5 billion convertible, with conversion prices of $313 and $325, well above the stock. Read it both ways, honestly. The bulls' version is that the credit window Burry says is closing just handed a neocloud five billion dollars at half a percent, demand oversubscribed enough to upsize, and the Vineland capex question is now fully funded. The bears' version is that the companies borrow like this precisely at tops, and a 0.50% coupon means lenders are really buying the equity option, not the credit. Both are true. What is not debatable is that the financing window is open today, and companies that fill their tanks while it is open survive the days when it is not. The war drums got louder too. Trump announced what he called the most crushing economic operation ever taken against any country, an "Economic D-Day" of secondary sanctions on any bank, airport, registry or front company that touches Iran. Oil closed at its highest since July, WTI $85.83 and Brent $91.62. Remember that the entire August rally began on August 3 with Iran de-escalation and Brent at $83. That trade has now fully round tripped, and the energy names printing 52 week highs this week suddenly look less like a rotation curiosity and more like the tape pricing what the diplomats could not deliver. The $4 billion that fled energy funds this summer left right before the story turned. Crowds usually do. Under it all, the split market rolled on. Semis bled again, with Broadcom ($AVGO) down almost 5% on news that Google added Marvell ($MRVL) as a custom chip vendor, though Broadcom did not lose the Google order, a second source was added, and the market shot first anyway. Tesla, Amazon, Lilly and Merck rallied on the same screen. And the Cass Freight Index posted its 42nd straight monthly decline, matching pandemic lows, the longest such streak ever recorded, a reminder that the physical economy has been quietly shrinking through the entire "greatest decade since the nineties" run the S&P is having. This morning futures have slipped red and the VIX sits near 18, a long way from Monday's 14. The sleep is over. Jobless claims and Walmart today, and Nvidia in six days, with the Treasury now visibly in the game. read more
When the world's second-largest economy stops lending, the demand shock travels fast. Chinese bank lending recorded its largest monthly decline in at least six years. Credit is the transmission mechanism of Chinese growth, when it contracts this sharply, consumption, construction and commodity demand all follow within quarters. The exposure is broad: $RIO and $BHP on the mining side, European luxury on the consumption side. $MC is the cleanest read on Chinese consumer health. Roughly a third of luxury demand comes from Chinese buyers, domestically and through travel retail. If credit contraction hits household wealth, the €5,000 handbag is the first purchase deferred. The chart is already there: $MC at €450, sitting on the €440–460 purple support zone, the last structural level before the 2020 lows. Down -50% from the €900 ATH in three years. RSI at 35–39 and no MACD cross yet, oversold without a turn signal. €440 is the line. Lose it and there's very little structure below. Hold it and this becomes a contrarian entry on the most powerful brand portfolio in luxury, if you believe Chinese credit stabilizes. Falling knife or generational entry in European luxury? 👇read more
The other day @paulsantori commented on a post of mine talking about taxes and it got me thinking....How many times do we actually get taxed on the same money? I earn income → pay income tax. I buy a house → pay property tax every year. I buy something → pay sales tax. I take my family out for a meal -> more taxes I invest → potentially pay tax on dividends, interest or capital gains. I drive → pay taxes built into fuel. Buy a new car = taxed, buy a luxury car = taxed even more. It feels like the same dollar gets taxed over and over as it moves through the economy. Obviously, taxes pay for the services and infrastructure we all use. I’m not arguing that taxes shouldn’t exist. But it’s still pretty crazy when you stop and think about just how much of your income never actually makes it into your pocket or stays there.... Earn it. Taxed. Own it. Taxed. Spend it. Taxed. And then we wonder why building wealth takes so long. Rip to all those Etfs that I could've bought instead lol read more
I don't know how people are still pronouncing $NVDA as "NUHvidia". It makes me visibly cringe every time I hear it. It's the same with people pronouncing $CBRS as "Sarah Brass", like come on, if the CEO and founders of the companies are pronouncing it a certain way, that's how it's pronounced. There are some things that might be tomAYto/tomAHto, but not this. If it's someone on the street who has only ever read it, fine, but someone who is a covering the company or going on the Schwab Network to talk about it, you think they would know by now or would have done an ample amount of research to get it right. It's not "NUHvidia", it's INvidia, even ENvidia is acceptable, because that's one of the origins of the name. Nvidia is from the latin "invidia", meaning "envy", also a double entendre for NV "New Version" when saving files. It's not CERAbrass it's CeREbras. If I am watching a video and someone says "Nuhvidia" or "Sarah Brass", I stop listening to what they're saying or find another video. Ok, rant over.
$GOOGL isn't just buying chips from Marvell. It's buying part of Marvell. Alphabet acquired a $12 billion stake in $MRVL as part of an agreement to manufacture custom silicon. Same structural move Nvidia made with SpaceX, turn a supplier relationship into equity alignment. Google gets guaranteed custom chip capacity. Marvell gets a strategic anchor customer with an unlimited balance sheet. The strategic read: Google is building a chip supply chain that runs entirely outside Nvidia. TPUs designed in-house, custom silicon through Marvell, now sold externally to neoclouds. $NVDA's moat is being attacked from a direction it can't defend, not by a rival selling GPUs, but by a customer that stopped needing them. The chart confirms: $MRVL +9.85% to $237, breaking the descending trendline from the $330 ATH and clearing the $220–230 purple zone. MACD crossing green for the first time in months, RSI at 58 with room to run, on 44M shares, institutional conviction, not retail chasing. $220 is now the floor. Hold it and $300 is the next real resistance. Lose it and the breakout was just a headline pop. Google is building a chip stack without Nvidia, is $MRVL the biggest beneficiary of the year? 👇read more
One of the best parts about the Blossom community is how open everyone is sharing knowledge and experiences. To make things easier for anyone just starting their investing journey, here’s a simple glossary to help understand and simplify various terms. Common Terms: Dividend: A share of a company’s profits paid to shareholders, usually quarterly. Ex-Dividend Date: The cutoff date by which you must own a stock to receive its next dividend. ETF (Exchange-Traded Fund): A fund that holds multiple stocks or bonds, traded like a single stock. Covered Call ETF: An ETF that owns stocks and sells call options to generate extra income (higher yield, limited / capped upside). Earnings Report: A company’s quarterly financial performance summary. EPS (Earnings Per Share): A company’s profit divided by its number of shares. Market Cap: A company’s total value (share price × number of shares). ACB: The total amount you’ve paid for an investment, including the purchase price plus any fees or commissions. Book Value: The value of a company according to its financial statements (assets minus liabilities). Yield: Annual dividend as a percentage of the stock/ETF price. Liquidity: How easily an asset can be bought or sold without impacting its price. Volatility: The degree of price fluctuations in a stock or market. Index: A benchmark of stocks (e.g., S&P 500, Nasdaq, TSX). Bull Market: A period of rising stock prices and optimism. Bear Market: A period of declining stock prices and pessimism. False Breakout: When a stock’s price moves above (or below) a key level, making it look like a new trend is starting, but then quickly reverses back. P/E Ratio: Price-to-earnings ratio (stock price ÷ EPS), used to assess valuation. Blue Chip: Well-established, financially strong companies with a track record of stability. Diversification: Spreading investments across assets to reduce risk. Broker: A platform or firm that facilitates buying and selling investments. Limit Order: An order to buy/sell a stock at a specific price or better. Market Order: An order to buy/sell a stock immediately at the current market price. Bid/Ask Spread: The difference between the highest price buyers offer and the lowest price sellers accept. Dollar-Cost Averaging (DCA): Investing a fixed amount regularly to reduce the impact of market swings. Capital Gain/Loss: Profit or loss from selling an investment for more/less than its purchase price. IPO: When a company first sells shares to the public. Index Fund: A fund designed to mirror the performance of a market index. Short Selling: Selling borrowed shares, hoping to buy them back cheaper. Margin: Borrowing money from a broker to buy investments, which amplifies gains and losses. Margin Requirement: The minimum amount of your own money (equity) you must maintain in a margin account to open or keep a leveraged investment position. Margin Call: A demand from your broker to deposit more funds or sell assets because your account equity has fallen below the required margin level. Time Horizon: The length of time you plan to hold an investment before needing the money. Short horizons = more risk-sensitive, long horizons = more room to ride out volatility. Stock Split / Reverse Split: A split increases the number of shares (e.g., 2-for-1) while lowering the price per share. A reverse split reduces the number of shares (e.g., 1-for-10) while raising the price per share. Your overall value doesn’t change just the math. Long (Being Long): Buying a stock or asset because you expect the price to go up. Short (Being Short): Selling a stock you don’t own because you expect the price to go down, so you can buy it back cheaper later. TER: The total yearly cost of owning a fund, including the management fee plus other costs like administration, audits, and legal fees. MER: The annual cost that a fund charges for management (includes any leverage costs if used). Management Fee: A portion of the MER that goes directly to the fund managers for running the fund. Withholding Tax: A tax deducted on dividends/distributions from foreign investments (e.g., U.S. dividends to Canadian investors face a 15% withholding in TFSA/Non-Registered accounts). Total Returns: The full picture of an investment’s performance, including both price gains and dividends/distributions. CAGR: The average yearly growth of an investment over time. NAV: The price of one share of a fund (stock or etf) NAV Depreciation: When the fund’s share price goes down over time. Mutual Fund: A pool of money from many investors used to buy a mix of stocks, bonds, or other assets. Bond: A loan you give to a company or government, and they pay you back with interest. Asset: Anything valuable you own that can generate money. Portfolio: Your collection of investments. Option: A contract that gives you the right (but not the obligation) to buy or sell a stock at a set price. Future: A contract to buy or sell something at a set price on a future date. REIT: A company that owns real estate and pays investors income from rent. Alpha: A measure of how much better (or worse) an investment did compared to the market. Beta: A measure of how much an investment moves compared to the market. Sharpe Ratio: A way to see if returns are worth the risk taken. Hedging: Protecting your investments from risk. Rebalancing: Adjusting your portfolio back to your target mix of assets. FCF: Free Cash Flow Understanding these terms makes investing far less intimidating. If anyone feels other terms should be included, please share in the comments. I’ll update this post so we can build a complete beginner-friendly resource together! *Sorry tagged a few etfs for reach 🫣read more
Want to respond to @ronan's feedback yesterday (and the feedback in the comments) with my own post so my response doesn't get lost in the thread Will start my saying I hear the concerns and am taking them very seriously and this is something I take personal responsibility to fix. I really appreciate everyone taking the time to write out their thoughts and see a ton of passion from everyone in solving these issues. As @ronan mentioned, Blossom has always had a spark and uniqueness and it's our job to make sure that spark doesn't go away as we grow. Here's my summary of the top problems I'm hearing and my plans to fix them: 🤖 1. The rise in AI slop posts crowding quality content - This was the #1 problem raised across the comments and is one we're actively working on. We're following @jacobb's suggestion of an 'AI detection' feature with the ability to see less posts like this. This is set to go live in 3-4 weeks, will see if we can accelerate this 😢 2. Us vs them mentality, hostility especially to new creators - This one is a bit tricky as we don't want to overly police what people say. But there's one example someone gave of a new user being called a loser that are blatantly against our community guidelines of respecting one another. I think the same way we've built in spam/scam detection, we need to do the same for these kinds of comments so we can uphold these guidelines better 🏆 3. Too many milestone posts crowding out quality content - I think there is an important place on Blossom for this kind of content as the milestones are encouraging to other investors in their journey (including myself). I think the issue more so is the volume of them. Curious for folks feeling this issue whether they've tried clicking 'see less posts like this' as that should fix this issue. If not I'll investigate and perhaps not a lot of people know about this feature. I think #1 and #3 stem both stem from the feeling that quality content isn't being rewarded... let me think deeper about how to solve this problem more broadly as I definitely see this too and I don't think fixing AI slop will fully solve this. One commitment I have is to spend much more time connecting with and chatting with Blossom's creators, I want to solve this problem as much as you guys do. One good news is we recently hired our first product manager (who is a Blossom shareholder and creator) who will be fully dedicated to helping me solve this and together we'll have much more time to chat with your all and think about how to solve these problems. 🙏 Let's get Blossom back to the glory days of this community!read more
I dare say this will be my best deep dive EVER! A couple of days ago I wrote about a very special research project I’m running to dig through the 13F filings of some of the world’s best small-cap growth focused hedge funds to create a map of where the smartest capital is flowing right now. I wanted to get you guys excited with a quick update on the progress before the full article drop on Friday. So far I’ve managed to: - log all activity from 11 specialist funds, - Track positions in a total of 754 securities - Reviewed all Q1 vs Q2 2026 share counts Leading me to discover: - 227 brand new positions initiated - 214 positions completely exited - 90 companies held by 3+ specialist managers simultaneously - 27 companies where 2+ managers independently opened new positions the same quarter This will be an absolute gold mine for all of you to dig through and review. I found 5-way ownership clusters. Triple new-entry signals where three managers all discovered the same company in the same quarter. One biotech position where the world’s most respected biotech fund has $2.1 billion invested and is STILL buying more. I’m now in the final stages of my research applying fundamentals and technical analysis to the shortlist of companies where clusters of smart money is deployed. After which I’ll be creating my own list of positions to invest in. This full research will be dropping on Friday, I invite you to follow my account so you don’t miss it. And for the time being I’ll leave you with 2 small teasers of companies on the list, that few of us might have heard of.. just look at the YTD charts and you’ll understand who has their pulse on the markets and why we are interested to follow in their footsteps. Check out $ARXS$RVMD I also left a summary table of all the hedge funds I’m tracking in this research to show you the scale of work. Hoping you’ll all find value in the work. read more
5K seemed to be so far away at the start of the year. Logged on casually to see this notification! Just a reminder do what you can but keep it consistent.
There's still TIME! 😂 You just have to know how to read and listen to it. 🤓🧠 If you are still looking for a place to lay your head, you may want to try here. Link in Bio. Natural selection is alive and well. 😐 This is the Way! 🏄♀️🌊
Jeff Bezos's Amazon made a massive new $1.2 billion bet on XE, an outsized move that instantly became more than a quarter of the entire portfolio. Visit Bezos's profile to see his full portfolio and recent trades this last quarter from his 13F filing.
Just repeating something I said on my most recent podcast with Moe. I think it’s oversimplified to rationalize differences in investing styles with the assumption that people simply have different goals. Two people can have the same goal, like buying a house, and even have similar time horizons, yet arrive at very different investment decisions. Sometimes the difference is simply how they evaluate the risk and expected return of various investment vehicles. One person might think the additional expected return from equities is worth the downside risk. Another might think the possibility of a large drawdown makes that trade-off unattractive. Their goals don’t have to be different. Their assessment of the investment, the risks involved, or how consequential those risks would be can be different. For more, check out our latest episode: https://www.youtube.com/watch?v=YpaMX7abT50&t=2sread more
How to convert the $VIX into an expected daily move in 5 seconds 1️⃣ Check current VIX 2️⃣ Divide by 16 3️⃣ Get your 1-day implied range (1-standard deviation / ~68% probability) Quick cheat sheet • VIX 12 ➡️ ±0.75% • VIX 16 ➡️ ±1.00% • VIX 20 ➡️ ±1.25% • VIX 24 ➡️ ±1.50% Save this post for your daily watchlist routine. Do you use the $VIX ? 👇read more
I see many beginners posting that they’re new to investing and don’t know where to start. 🤔 As someone who was in a similar situation just a few months ago and learned, here are the 4 ETF types (& ETFs) that are popular among long term investors 😃 : 1) S&P 500: US: $VOO / $SPY / $SPLG Canadian: $VFV / $ZSP / $TPU 2) GROWTH / TECH: US: $QQQ / $VUG / $VGT / $SCHG Canadian: $QQC / $HXQ / $TEC / $ZUQ 3) DIVIDENDS: US: $SCHD / $VYM / $DGRO Canadian: $VDY / $XEI 4) ALL IN ONE / BASKET / Global Exposure: US: $VT / $AVGE Canadian: $ZEQT / $XEQT / $TGRO / $VEQT / $ZGQ I noticed many people following this type of a basic / uncomplicated portfolio and are doing really well for themselves 🔥 For % allocation, you can divide evenly among the ETF categories or allocate a higher % based on your preferences. Just DCA regularly and you should be good. 😎 Some people even just put it all into an all in one etf like $XEQT. This is also a good approach - it is much simpler and it works. Ultimately, it comes to whatever you prefer 🙂 Oh and yea, there are overlaps, but I don’t think there is anything wrong in that though - it would just count as doubling down on good things. 💯 I’m sharing with you all what helped me, but don’t forget to do your own research too! 🙏🏼 read more
I’ve been running a very boring and conservative Balanced portfolio with a variety of ETFs (Index, Factor & a bit of CC) for the last few years. 😴 Since markets have been strong the past few years it’s given me more than enough to cover our expenses. 🙌 But with the popularity of CC/High Yield ETFs and so many finfluencer videos to learn from I thought I’d check a few out and see if it makes sense to jump on the ‘yield train’ to take advantage of these big monthly pay days! Before pulling the trigger though I thought I’d run the theory through a few scenarios using @karyungtom Retirement Spending Calcultor to gauge the probability of my money lasting 30yrs. https://karyungtom.com/retirement-spending-calculator/ We can’t know future return paths but we can run various assumptions based on past market performance and other tools like a Monte Carlo simulator. So let’s see what happens… CURRENT PORTFOLIO/APPROACH Plugging in my hypothetical $2M and setting my spending strategy to ‘Fixed Inflation Adjusted’ with the Withdrawal Rate = 4% starts me off with $80k for spending. Not bad! 👍 Let’s say my time horizon is 30yrs and Inflation = 2.5%. Using the ‘Historic Backtesting’ option (which pulls full history of SP500 data) I can see this Model was a near 100% SUCCESS RATE through all time periods (5-30yrs). [pic#1]✅✅ But… Unfortunately I’m not comfortable running a 100% equity portfolio. Since im running a 60/40 portfolio I need to see what that looks like. THE BALANCED MODEL ⚖️😴 The only way to see the 60/40 Model using the tool is to change my simulation model to the Monte Carlo option. From there - I can keep the 100% equity option or change to a Global, 60/40, Conservative or even a Custom option by entering my own Return/Volatility assumptions. Before moving to my current 60/40 model I hit ‘Run Simulation’ on the SP500 (all equity) just to get a BASELINE result to compare other Models against. This showed a probability of 90-100% for the shorter timeframes but 88%-84% for the 25/30yr periods [pic#2]. Still - odds would be in my favour that our money would last! ✅ Moving to my Balanced (60/40) option I expected a lower success rate due to being more conservative but surprisingly the 25/30yr success rate jumped to 95-90% [pic#3]. A bit surprising - but I’ll take it!!👍👍 That said - I WANT A CASHFLOW MACHINE! 🏧 Even though above result showed that bonds improve my probability of success one PI Finfluencer suggested ‘bonds are useless’ and from all the CC ETF portfolios I see on Blossom I have to assume that 100% equity is much better for the CC ETF approach. Another Finfluencer suggest I need to ‘create a yield at least 3x bigger than my spending needs’. This would let me receive big monthly paydays to cover my expenses and the excess could simply be reinvested! I would ‘never have to sell a share’. Sounds great! Luckily - @karyungtom calculator lets me model all of this out and link to Return/Volatility assumptions based on the preferred asset allocation. So let’s take a look at… THE CASHFLOW MODEL 💰💰 Following the guidance of the Finfluencers I switched the model back to 100% Equity/SP500. This showed Expected Return = 10.5% and Volatility = 19.7% (both seem reasonable and inline). I guess I’ll just have to accept more volatility if I want to benefit from the high yields. 🤔 I referred back to the ‘Rules/Guidance’ I saw online for CC ETFs and saw I should have a mix of 15%+ and 30%+ yielding products. Based on that I set my models Distribution Yield = 25%. YES!!! On the Model’s $2M value a 25% distribution would mean a $500k per year PAYDAY! Now we’re talking! 🤑🤑 Let’s run it! …… WTF! The SUCCESS RATE stayed the SAME. 🤷♂️🤷♂️ The 25yr = 88% and 30yr = 84% is same as baseline [pic#2&4]. So no advantage. The portfolio generated way more cashflow but since I only need 4% to cover my spending I now have to reinvest the excess to make sure I get the same result. Hmm. I guess Distribution Yields don’t influence actual longevity. ‼️ What’s nice is the calculator actually shows this in the ‘Portfolio Path Table’. It even shows a hypothetical share count if you’re interested. Under this approach I guess I at least don’t have to ‘sell my shares’ right away since I’m receiving such big distribution. I guess that’s a bit of a convenience - but kind of offset by fact I have to figure out my reinvestments. 🙃 And wait - CC ETFs have much HIGHER FEES than the Tradtional Index/Factor ETFs I was using for my Balanced Model. 🤔 My model has a total cost of 0.5%. When I calculated the MER/TER of a CC ETF Model it was closer to 1.7%. I wonder if I should lower my Return to reflect the higher cost? I wonder if that makes a difference over 30 years? After all - 0.5% on $2M is $10k per year in fees and 1.7% is $34k per year in fees. Whatever 🤷♂️ - so I’m paying a bit higher in fees ($24k/yr). I can go check out @smallbird.financial website later for his Fee Calculator to see total impact. Let’s ignore fees for now and get back to my options for boosting my MONTHLY CASHFLOW… So far I have the same expected success rate and I’m just receiving cash instead of having to sell my shares but I’m paying a $24k/yr more fees and have to make sure I reinvest all the excess cash that’s coming in. That hardly seems like much of a benefit but since I’ve seen these CC/High Yield investors pay for vacations, kitchen renos and new hot tubs with distributions I can probably afford to take a bit more out for spending right? So let’s see what happens… HIGH SPEND MODEL 🏧🏦 With $500k per year or over $40k per month coming in and a $2M portfolio I can probably just reinvest 50% and take 50% or $250k for extra spending. An extra $250k of spending buys a lot of living!! Let’s go!!! Since my Yield = 25% I can set my Withdrawal Spend Rate = 12.5%. After all - I got some ‘juicers’ now! I’m not sure what a ‘juicer’ is (seems like a made up term for higher risk products) - but I’ll buy them anyway if it means I get an extra $250k! Let’s run it ….. AGAIN - WTF??? My first 5-10yrs looks fine - but by year 15 (when I’m only 65) it shows I’d have a 70%+ chance of hitting $0!! Year 25 = 88% and Year 30 = 90% chance of running out of money [pic#5]. ‼️🤬 So based on this success/longevity is NOT ‘impossible’ it just seems to be a lot ‘less probable’. Especially since this result is the exact OPPOSITE of my Balanced Model and 4% withdrawal that had a 90% SUCCESS RATE. So if I change - I get big paydays each month and don’t have to sell units but I have to take on more risk, pay higher fees, reinvest all the excess cashflow and accept that there’s only a 10% chance that my portfolio may still have some money by the time I’m 80?? Geesh - this is getting to be a lot to swallow. ⚠️😬 Maybe I missed something. Maybe this is better for SMALLER ACCOUNTS. I can change the portfolio value from $2M to $500k and maybe we can use it for our smaller accounts? Let’s run that… FML!! Changing the portfolio value did nothing. That’s also just a 10% chance of our money lasting 30yrs and a 90% chance that it runs out [pic#5]. ⚠️⚠️ Honestly - What’s going on? Ohhhh! You know what - this tool and calculator is probably wrong and just more ‘FUD’ because @karyungtom is one of those ‘growth’ investors. Maybe I should do what the other PI guys do and just block these growth guys. 😂 Then again - I guess the Finfluencers that I watched - despite their videos, spreadsheets, followers & sponsorships - may also just be learning and trying to figure this stuff out. So maybe I should take what they’re telling me with a grain of salt? 🤔 Either way - I get that these tools and calculators are all based on historic data (since future returns are unkown) - and they rely on a variety of assumptions and inputs - but just to be on the safe side and in case this analysis/approach is NOT totally wrong - I better take some more time to think and learn about portfolio construction, distributions and withdrawal strategies before I make a change to my actual portfolio. 🎯CONCLUSION As tempting as $40k / mth looks - given the trade offs seem to lead to a less certain/positive outcome I’m going to stick to my boring Balanced Model with 4% withdrawals because this data shows it has a higher probability of creating more sustainable longterm wealth. ✅✅✅ From these results - distribution yields DONT impact longevity. Only returns and withdrawal rates do. Letting high distributions lure you into bigger spending that is unsustainable is a real risk. 💡💡💡 MY TAKEAWAY ‼️ Despite everything I’ve seen online about the high yield strategies I’ve always seen distributions as a ‘feature’ of a portfolio - not an actual strategy on their own or a reflection of quality or indicator of future returns. This exercise more or less would support that view. 🤷♂️ I can see the use case for some CC ETFs in certain situations but it’s important to consider all aspects. Currently I’m happy with the small % that I own (more as a way to capture volatility vs for the yield) so maybe I don’t need to ‘go all in’ on them and take more risk or pay the high fees across my entire portfolio? 🤔 Since we can’t control markets or returns - withdrawing too much too fast seems like one of the surest way to damage a portfolio’s longevity and we’re probably better to control what we can - asset allocation, strategy selection, fees and withdrawals/spending. ✅ Still happy to have gone through the exercise. Hope this helps and you consider doing the same type of analysis for your portfolio. 🤓 Perspective ≠ Prediction Stay open to learning and do what’s best for you! 😉👍 ————- PS. Whether you agree with my take away and analysis or not - it’s worth exploring @karyungtom tool and entering your own models/assumptions. It’s a good one! 🤓 . read more
Distribution yield tells you how much cash the fund is paying you. It does not tell you how much money the fund actually earned. Income investing is not a new way of investing, and while today's covered-call ETFs are relatively new products, the financial engineering behind many of them is not. Leverage, derivatives, managed distributions and return of capital have been used by investment funds to enhance or maintain distributions for decades. Going back to the late 1990s, when I first entered the investment space, there were already funds paying double-digit distribution yields. And the same argument people have today about high yield distribution they were having then. Though they were far less vocal as it wasn’t as easy to converse with as many people all at once. The fascinating part is that most people understand this concept perfectly when you remove the investment fund from the equation. If you ask someone whether they can spend more money than they earn without eventually depleting their savings or taking on debt they understand that. Like if your household earns $80,000 a year but spends $120,000 every year, that extra $40,000 has to come from somewhere. You can sell stuff, withdraw savings or borrow money, but none of those things magically turn an $80,000 income into $120,000 of sustainable income. Yet put that exact same concept inside an investment fund and suddenly people seem to struggle with it. A fund can absolutely pay out more cash than it earns. What it cannot do is create economic return out of thin air. @karyungtom had a well written article on this point I encourage people read it. https://www.blossomsocial.com/posts/High-Yield__POST-1787186691972-RSs7aPx2_t00uBlccemcq8jzT?commentId=COMMENT-1787188693133-kl9V1UcW-45z9lALx4jh3jnD8_POST-1787186691972-RSs7aPx2_t00uBlccemcq8jzT&parentId=POST-1787186691972-RSs7aPx2_t00uBlccemcq8jzT&parentType=POST read more
