Re:Save like a pessimist, invest like an optimist
by paulpauper on Saturday November 14, 2020 @05:00PM
(#25096034)
path dependency is the main problem with margin trading. S^P 500 fell 60% in 2007-2008. So that should give you an idea of how much of a cushion you need to give yourself for the worse case scenario.
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Re:Save like a pessimist, invest like an optimist
by xchaotic on Saturday November 14, 2020 @05:52PM
(#25096419)
If this is just retirement money, so what? It rebounded pretty well since.
Re:Save like a pessimist, invest like an optimist
by paulpauper on Saturday November 14, 2020 @06:37PM
(#25096691)
if you have have 100% margin and the market falls 50%, the broker will close out all your positions at a large loss to protect its own assets (often well before the 50% target), at which point it will not matter how much the market rebounds after that