Made 750k In The Market - What Now?
Made a few highly speculative investments since the crash, the latest which basically involved me YOLO'ing my life savings from banking into a hyped up SPAC which proceeded to go ballistic. Conservatively I estimate I'll be able to double up the 750k, I'm still invested in the SPAC, and pull out $1.5mm in ~one month if the floor doesn't fall out from beneath the market. If I get lucky I'll pull out $2mm.
My biggest question is what next? Believe it or not I'm not a huge risk taker but I decided to speculate due to educated extrapolation and pretty much my intuition / gut feeling. If I get to around $2mm, should I keep going to see how far I can take it? There are so many generational companies going public in Q3 - Q4 and the market is on literal fire, it's like shooting ducks in a barrel. Insane IPOs coming to market include Robinhood, Doordash, Snowflake, Airbnb, Unity - and these are just a few off the top of my head. I think if I keep opportunistically trading in and out of the market on very strong momentum stocks, I don't see why I can't double up a few more times and potentially see if I can get my net worth into the low 8 figures.
I've been in banking for 4+ years and am basically completely bored / coasting through at this point and probably not masochistic enough to gun for making MD. I'm a highly respected top bucket associate in my group but not sure if people know how bored I am with banking in general. I'd probably quit if I was able to get to get to mid-to-high 7 figures.
What would you do if you were me?
Not sure what the percent gain is on that, but assuming its extremely high given its a "highly speculative investment", I'd definitely just pull out now. Seems like you want to keep going as you mention 1.5m and then 2m, but what are the odds that it completely crashes? If it ran up that high that quick, then I doubt its stable enough right now to not have a decent chance of crashing hard.
“I don't see why I can't double up a few more times and potentially see if I can get my net worth into the low 8 figures.”
this is where you are wrong
Why
You mentioned "double up a few times" like its nothing. Unless you mean over 20-30 years. If you mean in the next few years, then thats not gonna happen unless its all in this speculative investment which will still have high chances of crashing at some point. Don't view this luck as some genius strategy that you developed.
Have you been following the markets at all lately? Hyped up IPOs routinely close up 100% - 200% after the first day of trading. You're telling me when Robinhood IPOs or AirBnB IPOs, they won't trade up 100% after a few days? The market is on easy mode right now...
Yeah man you're right. Keep going, but why stop at double? You should be taking out leverage/trading on margin to really maximize those returns!
Im just saying if you burn once, you can lose a significant amount of your gains if you keep going as aggressively as you are. Even your initial post its obvious you keep reaching more for each step whether its 1.5m, 2.0m, etc. If you keep playing like this it will eventually crash. At the very least, take out some of your gains so you don't lose out on everything. This is pure wallstreetbets energy, please look at some of the climb ups and then crashes that have happened on that site.
Honestly this is reading like something out of a movie. Also seems like the pride before the fall kind of thing. You should sell out and bet the market goes down over the next few months at least til February if any thing. Maybe go long the vix that's what Id do if I didn't wanna just cash out.
I should bet against the market when it’s literally hitting all time highs every single day? Huh? Not sure what you mean by the movie part, I assure you this is real life.
I'm actually curious. How are you able to make these trades while in IB? Do you not have restrictions on single stock / short term trades?
Can trade but have to hold for at least two weeks and report all trades. So it’s not really trading, more like really short term investing.
$750k is peanuts. Not even close to the annual budget I have for client entertainment.
Keep your head down, and work hard.
Well, you'll lose half to capital gains taxes since you're selling short-term.
This
OP, if I were you and had 500k after cap gains tax, I'd put 400k in an index fund somewhere I couldn't touch it. 100k in the yolo fund and continue your fun strategy but never let myself pull from the other account if that gets down to 0. Keep playing around and try to get that up to 500k. If you're as successful and bulletproof as you say you could build a nice fortune this way.
Trying to "double up" is a quick path to eventually losing every last dollar. There's a reason no HF is out there returning 50%, speculation will blow up on you, especially if you think you're smarter than every other trader.
Is it really speculation if the goal is to swing trade the hottest tech IPOs of the decade in Q4? Maybe I’m just delusional, I can’t see Snowflake, Palantir, Unity, Doordash, Robinhood, Airbnb not experience massive pops first few weeks. When else in your life will you get a chance to swing trade that kind of lineup in a quarter?? It will be retail FOMO^2. A lot for people are going to become insanely rich. I’ll try to get Fidelity to give me some allocations and if no supply I’ll just get in when it opens.
This entire post is nonsense. Banks have very strict rules about trading, and investing in a specific issuer is probably against the bank's rules.
Nice troll though.
This is interesting. Nice outcome.
I was curious about if there is any regulatory/compliance risk. Understand logging/recording trades and not buying anything in your industry’s universe.
Here’s a hypothetical -
I’m an Associate in TMT covering several well known co.’s. What if I buy into a SPAC and the target happens to be a TMT name (perhaps a company that I’ve worked on). Any regulatory risk to me there? Thought about emailing compliance at my bank, but didn’t want to go there yet.
Thanks!
I think at minimum you won’t be able to work on projects with those names and compliance potentially may ask you to get rid of the positions. Just my thoughts though
Thanks! Not really worth it IMO
Hey. Thanks for the note. There isn't any regulatory / compliance risk that I'm aware of, outside of diligently logging your trades and the mandatory holding period (varies by firm). Compliance may throw a hissy fit if you enter and exit a position without holding for X days, so probably want to tread lightly and follow the rules. As far as SPACs go, I can buy them if they're not listed on our watchlist. Probably the same for you, but might want to double check. If you're buying a pre LOI SPAC and it happens to announce a target in your coverage universe, you should flag to compliance and they'll tell you what to do.
Curious about what ended up happening
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