BANG! BITCOIN BABY

[Setox]

I'll consider 10% bonds on margin instead.

Where ? take us with you bro, we've got the cash.

 

[Tanjiro B]

if ETH falls will USDT-ERC20 also fall?

 

[splishsplash]

I'll consider 10% bonds on margin instead.

Me too.

But, it's not TEN percent.. That was just his second example..

It's 19-20% - See here lol

You can purchase bonds on margin at most brokers, with very low rates, and at least 4x, which means your net return would be 4 x 5.5% - margin rate which is typically 2-3% - that works out to a net amount of 19-20% annualized return if you buy treasury bonds on margin.

Haha, I missed this. He tells us here like an old pro that "margin rate which is typically 2-3%", then when shown base rates for a couple of brokerage firms showing 11-12%, he finds one showing 6-7% as if this changes anything. What happened to those 2-3% typical margin rates? Did he still think this was 2020-2022 when the Federal Funds Effective Rate was 0.06% to 0.10%?

Of course the coupon on bonds from 2020 was 0.5 to 1.5%..

We just need the margin rates of 2-3% from 2020 with today's bond rates.. And then.. BOOM. We can make those magic 19-20% returns by buying bonds on margin. Maybe he has a time machine? He's going back in time to borrow money at 2-3%, then coming back to the present to buy bonds?

Ah what do I know. I'm a delusional pseudo-economist clown who is out to mislead people! Don't listen to me. Get your bonds on margin and make 20% returns!

Interactive Brokers margin rates around 6.5%, doofus. Once again proving how clueless you are, and how cult-like your belief in the lies of crypto extend. Then, you fail to realize that the coupon rate of the bond is not the same as the effective rate, because bonds can be bought at a discount. And with treasury bonds you can leverage your cash deposit by 4x, which means $100K account can buy up to $400K worth of bonds - you are paying interest on 75% of the purchase amount if you take advantage of the 4x leverage, so 3/4 of 6.5% = 4.875% net margin rate. Whatever you can earn above that is free money.

So, let's say your effective rate for a bond is 10% and you deposit $100K to buy $400K worth of the bonds.

You are earning 10% on $400K
You are paying 4.875% on $400K
Your net profit is 5.125% on $400K

But your deposit is only $100K, so if you did a cash-only purchase of bonds with 10% effective rate, your annual profit is $10,000.
Using margin and purchasing bonds at the right time means you are earning $20,500 annually, or 20.5% on $100K. Get it?

Sorry I forgot. I'm a doofus as well.

But I just have to re-highlight this one..

It's too good.

Let's take this apart bit by bit.

Ok, he states the coupon rate of the bond is not the same as the effective rate. Correct. 100% correct. They are not the same.

Next, he states bonds can be bought at a discount. Absolutely spot on and 100% correct again. However, what he doesn't know as he's lacking knowledge about bonds, is that you can only buy bonds at a discount if interest rates go UP. Ie, that 5% coupon bond that was bought for $1k can now be bought for around $500 depending on age if interest rates go up and current coupon rates are 10%. This is a HUGE point he is missing.

Next, he states "with treasury bonds you can leverage your cash deposit by 4x", as if treasury bonds are special bonds you can leverage.

Then he says "you can leverage your cash deposit by 4x, which means $100k account can buy up to $400k worth of bonds". Ok, fair enough. You can do this.

Then he says "you can pay interest on 75% of the purchase amount if you take advantage of the 4x leverage, so 3/4 of 6.5% is 4.875% net margin rate" - Correct, spot on.

Now he says(and this is where the logic totally fails) - "So, let's say your effective rate for a bond is 10% and you deposit $100K to buy $400K worth of the bonds."

I ask. HOW?

How are you getting an effective rate of 10% for a bond?

He will either not reply, or he will reply with something like

"listen doofus, I'm not here to teach you how bonds work and explain to you how you can make money. If you can't work this out by yourself then you need to go home. clown."

Because of course, anyone who understands bonds knows.. You can't turn a bond with a 5% coupon into a bond with an EAR of 10%.

And he's also misunderstanding terms.

EAR is effective annual return - https://study.com/learn/lesson/effective-annual-rate-formula.html

It's just the yield taking compounding into effect.

The ACTUAL term he's looking for is "effective yield", not "effective earnings rate" which is an entirely different concept.

And the effective yield is exactly what I said in my previous post

Ie, you have bought a bond with a purchase price of $1000 that has a coupon rate of 5%, for $500, because that's all it's worth now. So your effective yield is 10%.

But, the only way bonds are sold for this, is literally if current coupon rates are around 10%.

His strategy just does not work.

What he would need to do is take a loan at 6.5%, then bet that interest rates are going to go WAY UP in the next few days so he can then take the loan at 6.5%, then buy bonds with a 10% return.

It does not work in any way. His entire argument is based on the single line that says

"your effective rate for a bond is 10%"

But he can't explain how to get that.

I can and I could show the mathematical formula for calculating it, but unfortunately no one will give you bonds with the requirements to make 10% on a 5% coupon bond.

 

[Exxtra]

Oh good, the mod butts in to delete my entire post but lets the liar continue to lie. Nice bias there. LOL
Ignoring the delusional crypto-cultist, here is how bonds can work for you:

Bond: $100,000 face value @ 5% coupon rate
Buy for $95,000 cash, because bonds can trade at face value, above it, or below it.
At maturity, you earn: 5% of $100,000, which is $5,000, plus another $5,000 because you are paid the entire face value plus interest, meaning a net of $110,000.
That means your effective rate is 10% and your profit is $10,000.

A treasury bond is considered a safe investment, so you most brokers will allow up to 4x leverage on your deposit. Interactive Brokers charges about half of what most other brokers charge for margin loans, currently around 6.5%. Loan amounts are always based on the amount of your cash deposit. So, a deposit of $100K means your margin for buying treasury bonds is going to be $300K, or a total of $400K potential buying power. Taking the above example and using margin looks like this:

Bond: $400,000 face value @ 5% coupon rate
Buy for $380,000 using margin ($95K in cash; $285K in margin credit @ 6.5%)
Your net cost is 3/4 of 6.5% on $380,000 which is 4.875%
Your net profit at maturity is going to be 5% - 4.875% = 0.125% * $400,000 = $500 (interest) + $20,000 (principle) = $20,500 total
Your effective ROI for a $100K deposit is 20.5% on a 1 year maturity bond.

 

[davids355]

If BTC<=$250,000 then davids355=buyer

 

[splishsplash]

Oh good, the mod butts in to delete my entire post but lets the liar continue to lie. Nice bias there. LOL
Ignoring the delusional crypto-cultist, here is how bonds can work for you:

Lovely. "crypto-cultist". Pure comical. We aren't even discussing crypto at this stage, but how you can get 10-20% yearly returns on bonds with margin.

Anyway, let's go through this. I'm open to being wrong, but you need to show me, because your numbers don't add up.

Bond: $100,000 face value @ 5% coupon rate
Buy for $95,000 cash, because bonds can trade at face value, above it, or below it.

This is wonderful in theory. A beautiful 5% discount.

So, we just immediately go to the secondary bond market and we'll find bonds with effective yields of 10% due to the massive discount at face value.

Let's take a reality check.

Here's a bond on the secondary market :-

https://terrapinfinance.com/US91282CGD74
Price is 98.73.

That means 98.73 cents on the dollar.

Coupon is 4.25%

It has 1.17 years left and it pays out every 6 months. It has 3 more interest payments.

We don't need to calculate here, because they tell you on that site the yield to maturity(effective yield). It's 5.4%

There we go. 5.4%..

<doofus>
Now, I wonder why it's higher? duhhh, uhh..
</doofus>

Because interest rates are higher, so older bonds with smaller coupons have lost against face value.

But not to the tune of 10%. No way. Why? Why would they suddenly be worth 10% yield when current bonds are 5.2-5.5%?


This is the highest yield to maturity I can find

https://terrapinfinance.com/US912810SP49
7.32%

That's a 1.375% coupon rate.. so yeah

Won't work on margin, buddy. Sorry.

You know why it's 7.32%?

Because it's a 30 year bond, issued on the 15th of Aug 2020.

That means you've got 6-7% interest on your margin and you're making 1.375%. You have to fork out about 4.7% to 5.7% per year interest so even if you could maintain that for 30 years(lol) you're going to get margin called and be fucked. So this.. doesn't work. You need bonds with a maturity date 12 months or less.

Let's filter.

Let's be generous and say up to 31st Dec 2024 which is a bit over a year.

Here you go. This is the highest

https://terrapinfinance.com/US91282CEX56
3% coupon and 5.55% yield to maturity.

That's a good one!

And THAT is as good as it gets.

So, I ask you again.

Where's my 10%?

Your whole.. Bond trades for $100k at 5%. Buy for cash at $95k.. Boom. 10% thing is much like me saying.

milk trades for $1 a litre..

Buy for $0.50 and make a tasty $0.50 per litre profit. Boom.

Gold is trading at $1990.50 per ounce.

BOOM, buy for $1800.50 per ounce and make a tasty $190.50.

It's lovely jubly in theory, but you can't just make up a magic price you want to pay and claim you'll make profit because of your magic price.

The market sets the prices, not you.

I await your well thought out and intelligent rebuttal to my analysis.

 

[Exxtra]

Is the crypto-clown still preddit posting his long-winded drivel in here? Does he think that bond rates are set in stone, or that you should buy high and sell low? Maybe he "bought" crypto at its peak and now thinks that the more he cries on a message board the more likely his shitcoin is to break-even for him.

3-month Treasury bonds yield 5.48% right now.
4 x 5.48% = 21.92% (annualized yield) if you roll them over every 3 months at 5.48% or better.
Margin rates are ANNUAL so if you are paying 6.5% on the margin loan, it is roughly 0.55% per month. That is $550 per month for every 100K of margin balance, which is charged daily, so $550 / 30 = $18.33 / day per $100K margin balance.

And, the nice thing is, that as a bondholder you have the highest claims in court as a creditor for non-payment. Unless the united states implodes, which it eventually will but not yet, you will never get burned as a bondholder. As a cryptard pseudo-investor you have no claims of anything, because crypto is a medium of exchange: not an asset, not a commodity, not property.

Why the mod lets that scammer keep spamming is beyond me. Perhaps the mod is endorsing the fraud of crypto "investing", a ponzi scam at best.

 

[SEOling]

Looks even better in Canadian


View attachment 293592

Looks like it is about go down

 

[splishsplash]

Is the crypto-clown still preddit posting his long-winded drivel in here? Does he think that bond rates are set in stone, or that you should buy high and sell low? Maybe he "bought" crypto at its peak and now thinks that the more he cries on a message board the more likely his shitcoin is to break-even for him.

3-month Treasury bonds yield 5.48% right now.
4 x 5.48% = 21.92% (annualized yield) if you roll them over every 3 months at 5.48% or better.
Margin rates are ANNUAL so if you are paying 6.5% on the margin loan, it is roughly 0.55% per month. That is $550 per month for every 100K of margin balance, which is charged daily, so $550 / 30 = $18.33 / day per $100K margin balance.

<doofus>

Ahhhhhh.

I see. I totally misunderstood bonds!

Doh! A 3-month treasury bond pays 5.48% every 3 months, so yeah. that's 4 x 5.48% = 21.92% ANNUALLIIZZZZEED returns baby. WOOHOO I WILL BE RICH!)

</doofus>

A 3-month treasury bond with a 5.48% yield pays 1.37% on maturity after 3 months.

Not 5.48%.

Your actual yearly is.. and drumroll.. It's EAR AGAIN!

Effective Annual Returns.

And what did I say the formula is, 2 times now?

EAR = ( 1 + ( i / n ) )^n - 1

Where i = interest, and n = number of payments per year.

Let's do the sums.

( ( 1 + (0.0548 )/ 4 ))^4 - 1 = 0.05593646063

0.05593646063 * 100 = 5.59%

Yes, it's 5.59%. It's not 21.92%.

You do not understand even the basic compounding interest math.

Taking a 3-month bond yield and multiplying it by 4 is utterly retarded. I seriously wonder if you are trolling now, or do you really think this is how 3-month bonds work?

And, the nice thing is, that as a bondholder you have the highest claims in court as a creditor for non-payment. Unless the united states implodes, which it eventually will but not yet, you will never get burned as a bondholder. As a cryptard pseudo-investor you have no claims of anything, because crypto is a medium of exchange: not an asset, not a commodity, not property.

We're back to the straw-man now?

What's this got to do with making 10% returns buying bonds on margin?

You can't do simple bond calculations, and you're back to telling me the Commodities Futures Trading Commission of the United States Government is wrong about their definition of bitcoin being a commodity?

Why the mod lets that scammer keep spamming is beyond me. Perhaps the mod is endorsing the fraud of crypto "investing", a ponzi scam at best.

I'm a scammer, how?

Who am I scamming and how?

Anyway we've pretty much come to the end here.

You are now ignoring everything I'm saying and just launching insult after insult and making completely baseless, mathematically outrageous claims.

At this stage you may as well say 1 + 1 = 50, so I can turn my 2 $1 bills into a $50 bill.

 

[RocketRDP]

Some action after such a long period of movement sideways

 

[SEOling]

Wrong on multiples levels. The belief its nothing is also entirely false. It is a secure proven technology that is recognized by the SEC as a commodity.

No offence, but when you aren’t even correctly using the term “asset” you are not qualified to be giving such strong advice about anything finance related.

Bitcoin is an asset.

Bonds are assets.

CASH is an asset.

Bitcoin however is considered a commodity.

Do some research and study.

You can also read my detailed post i made here explaining why bitcoin is going to be the reserve asset for corporations: https://www.blackhatworld.com/seo/what-can-you-do-with-200k.1539518/page-3#post-16934299

Inflation is 8% at least on the dollar. US bonds are at 5.5%

Fine for some of your cash, but bitcoin is a far better commodity to buy and hold outside of bull runs.

Gold is at an inflated 30 year all time high. It is NOT going to go higher. Buying gold at this stage is risky and you get no yield. Bitcoin has no yield but anyone that thinks bitcoin is going to drop after really digesting my post either doesnt understand the implications or is a troll

"
Bitcoin is an asset.

Bonds are assets.

CASH is an asset.

Bitcoin however is considered a commodity."

Is Bitcoin an asset or commodity? It appears it is both.

 

[splishsplash]

"
Bitcoin is an asset.

Bonds are assets.

CASH is an asset.

Bitcoin however is considered a commodity."

Is Bitcoin an asset or commodity? It appears it is both.

Exactly. 100% correct.

All commodities are assets. All currencies are assets. All property are assets. All stock are assets.

The asset class is very broad.

The biggest question here is why Exxtra is so furiously aggressive towards bitcoin, calling it a ponzi-scheme and me a scammer because I buy bitcoin.

I would put my money on him getting hammered during the last bull run and he's now ultra anti-crypto.

BOOM

He was paying with crypto in April 2023.

Why would someone who thinks crypto is a ponzi pay in crypto?

Because they owned crypto at that point.

Why did he own crypto? Because he was trying to bank, but got wrecked.

Caught red handed. Here :-

 

[Exxtra]

<doofus>

Ahhhhhh.

I see. I totally misunderstood bonds!

Doh! A 3-month treasury bond pays 5.48% every 3 months, so yeah. that's 4 x 5.48% = 21.92% ANNUALLIIZZZZEED returns baby. WOOHOO I WILL BE RICH!)

</doofus>

A 3-month treasury bond with a 5.48% yield pays 1.37% on maturity after 3 months.

Not 5.48%.

We went over this already, didn't we? Your effective returns will be higher based upon your leverage. Interactive Brokers will offer a margin requirement of 1% of the market value of the bonds for bonds with a maturity less than six months.

If you deposited $10K, you could theoretically buy up to $1,000,000 in bonds. The IB margin rate for amounts between $1M and $50M is 6.11%. If you maxed this out, your margin rate would be 99% of 6.11% because 1% of the amount is in cash, bringing the effective margin rate down to 6.049%, or let's call it 0.5% per month. If you buy the bond low, which is when the yield is high, then you can sell it when the yield drops and the price of the bond appreciates. Bond prices fluctuate over time.

If you sell the bond before maturity your profit is interest earned plus the difference between buy price and sell price. With the above stats, to earn a profit, you need to be above 0.5% within a month. This is entirely doable if you are paying attention to the markets. Right now a 6-month treasury bill is 5.56% so it's a good time to buy relative to historical prices.

So let us say you managed to squeeze out a 0.5% profit within a month, that is 0.5% of $1,000,000 or $5,000 profit on a $10,000 deposit in about a month. I'm not really sure why you are having such a hard time following along here. A $5,000 profit on $10,000 investment is 50%. Even if you only managed 0.1% profit in a month, that's a 10% profit on your deposit.

If we annualize that, what does that work out to? You like to do math so go ahead and tell me what that works out to.

What's this got to do with making 10% returns buying bonds on margin?

It's not a surprise that you would even be asking this, but I'm afraid I cannot explain. You keep on asking chatGPT to answer for you and pretend you're smart. LOL

I'm a scammer, how? Who am I scamming and how?

Crypto is a medium of exchange, not an investment vehicle. You are promoting a ponzi scam if you are inducing people to invest in any crypto as if it were a security. It is fraud on its face.

 

[Exxtra]

He was paying with crypto in April 2023.

Why would someone who thinks crypto is a ponzi pay in crypto?

Because they owned crypto at that point.

Why did he own crypto? Because he was trying to bank, but got wrecked.

Caught red handed. Here :-

Ahh yes, redditard being allowed to troll. Show me where I ever said that crypto was anything other than a MEDIUM OF EXCHANGE? I never suggested it was an investment. Imagine being you and thinking you're "winning" here. LOL You lost the moment you started your cRypTo iS a CoMoDitY stupidity.

 

[timetogrind]

If only I didn't lose all my bitcoin on a scam app

 

[agedaccs]

We went over this already, didn't we? Your effective returns will be higher based upon your leverage. Interactive Brokers will offer a margin requirement of 1% of the market value of the bonds for bonds with a maturity less than six months.

If you deposited $10K, you could theoretically buy up to $1,000,000 in bonds. The IB margin rate for amounts between $1M and $50M is 6.11%. If you maxed this out, your margin rate would be 99% of 6.11% because 1% of the amount is in cash, bringing the effective margin rate down to 6.049%, or let's call it 0.5% per month. If you buy the bond low, which is when the yield is high, then you can sell it when the yield drops and the price of the bond appreciates. Bond prices fluctuate over time.

If you sell the bond before maturity your profit is interest earned plus the difference between buy price and sell price. With the above stats, to earn a profit, you need to be above 0.5% within a month. This is entirely doable if you are paying attention to the markets. Right now a 6-month treasury bill is 5.56% so it's a good time to buy relative to historical prices.

So let us say you managed to squeeze out a 0.5% profit within a month, that is 0.5% of $1,000,000 or $5,000 profit on a $10,000 deposit in about a month. I'm not really sure why you are having such a hard time following along here. A $5,000 profit on $10,000 investment is 50%. Even if you only managed 0.1% profit in a month, that's a 10% profit on your deposit.

If we annualize that, what does that work out to? You like to do math so go ahead and tell me what that works out to.



It's not a surprise that you would even be asking this, but I'm afraid I cannot explain. You keep on asking chatGPT to answer for you and pretend you're smart. LOL



Crypto is a medium of exchange, not an investment vehicle. You are promoting a ponzi scam if you are inducing people to invest in any crypto as if it were a security. It is fraud on its face.

Your 20% theory on bonds is delusional and makes no sense in reality.

If that were possible, everyone, including their mothers, would be doing it and getting a 20% return annually instead of investing in stocks.

Please help me understand what you mean. I'm not interested in the crypto argument that you all are having.

In your example, "a 0.5% profit on the $1,000,000 investment would result in a $5,000 return, which is a 50% return on the initial $10,000 deposit, all within a month. Even a smaller profit of 0.1% on the investment would result in a 10% return on the deposit."

However, this doesn't make sense because your principal was only $10,000. A small 0.01% adverse move in the market could lead to liquidation, considering the high leverage used.

Nobody in this world will lend you money at a rate lower than the risk-free rate.

No financial institution would lend money for investments at a rate lower than what they could safely earn on U.S. Treasury.

Interest on borrowed capital is always higher than the risk-free rate.

If you are talking about using insane leverage and predicting the markets, then you are just gambling. If it were this easy to make a 20% return, all hedge funds should have a minimum 20% return, yet the top hedge funds, with billions in cash, only has 10-15% returns at best, and those returns were made on stocks, not bonds.

You are also only talking about the best-case scenario here. Then, what if the opposite scenario happened and you made the wrong prediction? Then you are liquidated, fucked, and out of all your money.

 

[kalpana007]

View attachment 293589
Irish Spring Green Green across the board!

I know the pump won’t last but incredible movement 12% up in 24 hours!

Shows that there is still lot of potential left. Some people say that bitcoin has reached its peak but they will be proved wrong soon.

 

[splishsplash]

Your 20% theory on bonds is delusional and makes no sense in reality.

If that were possible, everyone, including their mothers, would be doing it and getting a 20% return annually instead of investing in stocks.

Please help me understand what you mean. I'm not interested in the crypto argument that you all are having.

In your example, "a 0.5% profit on the $1,000,000 investment would result in a $5,000 return, which is a 50% return on the initial $10,000 deposit, all within a month. Even a smaller profit of 0.1% on the investment would result in a 10% return on the deposit."

However, this doesn't make sense because your principal was only $10,000. A small 0.01% adverse move in the market could lead to liquidation, considering the high leverage used.

Nobody in this world will lend you money at a rate lower than the risk-free rate.

No financial institution would lend money for investments at a rate lower than what they could safely earn on U.S. Treasury.

Interest on borrowed capital is always higher than the risk-free rate.

If you are talking about using insane leverage and predicting the markets, then you are just gambling. If it were this easy to make a 20% return, all hedge funds should have a minimum 20% return, yet the top hedge funds, with billions in cash, only has 10-15% returns at best, and those returns were made on stocks, not bonds.

You are also only talking about the best-case scenario here. Then, what if the opposite scenario happened and you made the wrong prediction? Then you are liquidated, fucked, and out of all your money.

He doesn't understand anything about financial markets.

If you scroll up you'll see him say that a 3-month bond with a yield of 5.48% gets you an "effective yield" of 4 * 5.48 = 21.92%

He also keeps stating that bonds "go up in value" and in his last post even said they "appreciate". He doesn't understand any of these terms, nor has he ever traded bonds or he would at least know the coupon on a 3 month bond is yearly equivallent as all bonds are so you can compare them.

I showed him real live examples from the secondary bond markets to highlight that the best effective yearly yield you're going to get right now buying bonds on the secondary market is about 5 to 5.5%. There was a couple at 6-7% but they were on 30 year bonds with a 1.3% coupon, so you only get the majority of your return once the bond matures in 2050, so that's not at all suitable for margin. Heck, nothing is. How can you borrow money from anyone at a rate better than the US gov, who are the safest lender in the world is offering. The only way you can get rates lower is if you offer substantial collatateral, but that's just you then accessing liquidity from your long term assets with a loan. It's not margin.

The core problem is he thinks he can somehow put up $10k, get $1mil on margin at 6% and then he's going to go to the secondary bond market and find these magic bonds with a 10-20% effective yield. It's pure fantasy land. He isn't even talking about predicting the markets. He doesn't understand the relationship between bond pricing and base interest rates.

He also keeps throwing in garbage about crypto, when we're trying to talk about bonds. Every post he's shouting and screaming about crypto and calling me a scammer because I'm schooling him about financial markets.

We went over this already, didn't we? Your effective returns will be higher based upon your leverage. Interactive Brokers will offer a margin requirement of 1% of the market value of the bonds for bonds with a maturity less than six months.

If you deposited $10K, you could theoretically buy up to $1,000,000 in bonds. The IB margin rate for amounts between $1M and $50M is 6.11%. If you maxed this out, your margin rate would be 99% of 6.11% because 1% of the amount is in cash, bringing the effective margin rate down to 6.049%, or let's call it 0.5% per month. If you buy the bond low, which is when the yield is high, then you can sell it when the yield drops and the price of the bond appreciates. Bond prices fluctuate over time.

There's just so many flaws in your thinking. It's unbelievable.

You borrow 99% of an investment, so you multiply the interest rate of your loan by 0.99. Why? This is stupid. All you're doing is with this kind of thinking is funding your interest with your own money. It makes no sense to even look at it like this.

A simple example is if you can make 10% returns, and borrrow at 10%.

You invest $50k, and you borrow $50k.

What you're doing here is saying your effective interest is 50% * 10% = 5%

You're now making 5% on $100k, instead of 10% on $50k. It's just a pointless way to look at it.

The correct way to look at it is your interest on the loan is 10%, and your gain on the loan is 10%, so your effective gain is 0%

Do you actually believe the stuff you say? Are we seeing the Dunning-Kruger effect in full effect at the left of the bell curve here?

 

[MoonStarz]

seems this is the year of the bitcoin everyone isbeing waiting for.

 

[Exxtra]

If that were possible, everyone, including their mothers, would be doing it and getting a 20% return annually instead of investing in stocks.

The bond market is the largest financial market there is, so your comment is silly because "just about everyone" is investing in bonds and has been since the market existed. You're acting like this is new. Bonds have been a thing for hundreds of years.

However, this doesn't make sense because your principal was only $10,000. A small 0.01% adverse move in the market could lead to liquidation, considering the high leverage used.

What are you talking about "doesn't make sense"? Is this another cryptard argument trying to present the illusion that if you buy crypto there is no risk, but bonds are somehow dangerous? Your maximum loss for bonds bought on margin is going to be the difference between the yield and margin rate as long as you hold them to maturity. Obviously, maxing out your account is not a good idea - IT WAS PRESENTED AS AN EXAMPLE.

Nobody in this world will lend you money at a rate lower than the risk-free rate. No financial institution would lend money for investments at a rate lower than what they could safely earn on U.S. Treasury. Interest on borrowed capital is always higher than the risk-free rate.

What's with the line spacing? Is this the same troll on another account? Why are you even talking about the "risk free rate" when nobody asked you about that? I clearly stated that you can get a rate of 6-6.5% with IB, contrary to your previous claim that the best possible margin rate would be 12%.

If you are talking about using insane leverage and predicting the markets, then you are just gambling. If it were this easy to make a 20% return, all hedge funds should have a minimum 20% return, yet the top hedge funds, with billions in cash, only has 10-15% returns at best, and those returns were made on stocks, not bonds.

All "investing" is gambling, but coming from a cryptard who gambles in ponzi scams, that is rich. I don't know why you thought adding this in was somehow beneficial to your point. It just reiterates the fact that you don't know what you're talking about.

You are also only talking about the best-case scenario here. Then, what if the opposite scenario happened and you made the wrong prediction? Then you are liquidated, fucked, and out of all your money.

Another pointless comment, as if what you are saying here is only true about bonds and not about any other speculative investment. Tell us bro, be honest, you went all-in on shitcoin at $60K and now that it blips up into the 30s you think you're making profits.