News for hackers. Stuff that matters.
Re:When a Crystal Ball Isn't Enough to Make You Rich – Elm P... by wat10000 on Sunday December 15, 2024 @11:13AM (#42424189)
The S&P 500 is down less than 1% below its all-time high. It’s mathematically impossible to lose 52% following that advice.

I think “with 10% leverage” deserves a lot more than a parenthetical here.

Re:When a Crystal Ball Isn't Enough to Make You Rich – Elm P... by EVa5I7bHFq9mnYK on Sunday December 15, 2024 @11:23AM (#42424268)
Try it yourself, the game is not randomized. You should receive exactly the same result.
Re:When a Crystal Ball Isn't Enough to Make You Rich – Elm P... by TeaBrain on Sunday December 15, 2024 @03:25PM (#42425726)
If fully invested in just the S&P 500 with 10x leverage, it seems less mathematically possible to have lost just 52% unless it was an very short time horizon. If fully invested, 5% decrease in the value of the S&P 500, with 10x leverage, would lead to a 50% fund draw down, given no margin call during the 5% S&P draw down. In most years, the S&P experiences at least one short-term draw down off the years peak of at least 10%, which would lead to a complete loss of capital, given that they hadn't already experienced a margin call on the previously 10x levered assets, which would now be levered higher given a loss in the capital base.