Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
No. of Recommendations: 5
A few years ago I made the case for long brk short spy, that trade worked well.
Now, the smart trade is long brk short spy and other indexes that are, obligated, to add the hot IPOS to their indexes, regardless of price, 3-6 months after they start to trade. These offerings have very small floats. For YEARS I've discussed the difference between issued and outstanding and FLOAT, with several old timers here. Today, I would rather try to convince certain friends and family members that Trump has not pitched a perfect game and he's making way too many unforced errors than debate several of these financial issues.
I'm looking forward to Jan 1 2027 and 4/1, 2027. I want to see the top 10 - 15 holdings of SPY and QQQ. What percent of those indexes will have top 15 holdings with no with profits and no dividends? What percent have been public less than 2 years? Google the top 10 holdings of SPY in 2012. Any names you recognize? Any dividend payers with a track record of decades of audited financials?
THIS is NOT the SPY Buffett vigorously suggested years ago. I would love for Buffett to call Becky and share his current thoughts on SPY with respect to current valuation, current concentration, new inclusion rules etc, Perhaps he will shock us one last time and make that call ASAP.
Greg, aka, brk has no, obligation, to buy anything. In fact, IF, IF, Greg has any interest no doubt he can buy 500 million or so of any of the offerings he chooses at the IPO price or even invest pre-IPO. Which position do you prefer, the indexes that are REQUIRED to buy hot IPOS in the aftermarket regardless of price, that have VERY small floats, or Gregs seat at the table?
Good luck to all, I've made my call and the case in real time, I'll revisit this post in 6 months, a year, and down the road.
No. of Recommendations: 2
welcome to modern day wall street. Hopefully Buffett's heart is healthy enough to handle what's going on.
" For the past 25 years, day traders of stocks and options in the U.S. needed to have $25,000 sitting in their accounts. If they didn't, they could only execute three day trades over a five-day period, while making a fourth trade would flag them as a pattern day trader and lock them out of their account. No longer. The PDT (Pattern Day Trading) rule is disappearing today—or at least most of it.
Backdrop: The pattern day trading rule was implemented by FINRA in 2001 in response to the dot-com bubble. Active traders got hit hard during the downturn given the use of borrowed money, or trading on margin. New requirements were then put in place to fund their accounts in the hope of curbing excessive risk and speculative activity, as well as protecting brokerages from significant losses. However, critics have taken issue with the rule, saying that it was seemingly based on wealth rather than safety, and it was developed before the advent of zero-commission trading and real-time market access.
Under the new system, the $25,000 minimum balance is going away, as well as the old rule that counted trades and the label of a "Pattern Day Trader." Instead, brokers will utilize monitoring infrastructure to look at the actual risk of open trades, and could block overleveraged ones or issue a margin call by the end of a trading day. It's also a massive win for fast-moving derivatives, as retail accounts can now rapidly buy and sell zero-days-to-expiration (0DTE) options. Existing margin requirements are sticking around, however, including the $2,000 margin base minimum, the 25% margin maintenance rule, and the restrictions associated with repeatedly failing to pay off margin deficits on time.
Outlook: While FINRA is scrapping the PDT rule today, it is giving companies time to implement the changes across their systems. Brokerages like Robinhood (HOOD) and Webull (BULL) are jumping on the bandwagon immediately, though Charles Schwab (SCHW) is waiting until June 8, and Interactive Brokers (IBKR) and E*TRADE (MS) are set to make the changes soon, but haven't stated an exact timeline. Unlocking unrestricted day trading is set to be a tailwind for the companies' bottom lines, fueling fresh transaction volume that will translate directly into higher payment for order flow, margin fees, or premium subscriptions."
WHO NEEDS VEGAS, roll those dice retail!! ucmtsu,no way. ::))
No. of Recommendations: 2
“ To get into the S&P 500, a company is supposed to make some money. The sum of its four quarters of earnings has to be positive—at least GAAP wise—and so does its most recent quarter. That’s a pretty basic rule, decades old and it’s the reason Tesla sat outside of the index until the end of 2020, years after it had become one of the most valuable companies on earth.
Soon, that rule will be broken, likely three times. On purpose.
SpaceX, OpenAI and Anthropic are all independently preparing to go public, at different speeds; SpaceX has released its S-1, Anthropic filed for IPO on Monday and OpenAI is rumored to next quarter. None of those companies yet make money; in fact, SpaceX lost billions last year, and OpenAI and Anthropic are also not profitable. Yet, when they go public, they will be ranked among the largest companies in America; and quickly begin dominating 401Ks and index funds. “ I wonder what Buffett thinks about this?
No. of Recommendations: 2
No. of Recommendations: 4
“” SpaceX will not be allowed early entry into the S&P 500, as S&P Dow Jones Indices decided against changing its inclusion rules for mega-cap IPOs. This means the company will not be fast-tracked into funds like the SPDR S&P 500 ETF (SPY) or the iShares Core S&P 500 ETF (IVV).Under current S&P 500 index requirements, companies must fulfill specific criteria before becoming eligible:Waiting Period: At least one year of public trading.Profitability: Four consecutive quarters of positive GAAP earnings.Market Capitalization & Float: Minimum market caps and public share float availability.Because SpaceX will not receive an exemption from these baseline requirements, the absolute earliest it can be considered for inclusion in the S&P 500 is June 2027.“”
No. of Recommendations: 1
Just a reminder for the market timers out there who don't approve of Greg. You can sell brk, go all in MMFs, and buyback brk below 400, no?
No. of Recommendations: 2
"" It turns out that that is not going to happen 6 months after the IPO. In fact, the earliest it may happen is 12 months after Friday's break for trading... and realistically well after that.
That's because after the close today, S&P Dow Jones Indices said it would keep its existing eligibility requirements for main benchmarks like the S&P 500 Index, rejecting proposals that would have made it faster for mega-cap companies such as SpaceX to gain rapid entry into the benchmark after going public.
The index provider in a press release Thursday said it will not shorten the 12-month seasoning period for newly public companies it currently has or waive existing profitability and public-float requirements based on a company’s size, diverging from a broader industry shift embraced by rivals Nasdaq Inc. and FTSE Russell.
This is what S&P Dow Jones said in the press release:
"S&P DJI determined that exceptions to the financial viability, seasoning, and IWF requirements should not be granted solely based on market capitalization. The decision not to adopt the proposed exceptions preserves core index principles by maintaining consistent application of these key requirements. Although there may be trade-offs between strict adherence to these eligibility requirements and broad representativeness, the current methodology provides substantial market coverage and sector balance. As a result, the indices can continue to meet their stated objectives while preserving their role as representative and investable benchmarks for the U.S. equity market.
No changes will be made to the eligibility criteria including financial viability screens, seasoning period, or minimum IWF, for the S&P 500, S&P MidCap 400, or S&P SmallCap 600 as a result of the S&P Dow Jones Indices consultation on the treatment of MegaCap companies. Accordingly, there will be no changes to existing methodology for this index family."
A more detailed breakdown of today's announcement: ""
https://www.zerohedge.com/markets/sp-denies-spacex...
No. of Recommendations: 1
"" The requirements that will now remain in place are:
No changes to S&P 500 eligibility rules for mega-cap companies.
Mega-cap companies will still need to wait 12 months after their IPO before being considered for S&P 500 inclusion.
S&P will not waive profitability requirements for mega-cap companies. The company must have positive GAAP net income in the most recent quarter, and the sum of the most recent four consecutive quarters.
S&P will not waive minimum public float requirements for mega-cap companies. At least 10% of a company's shares must be publicly tradable ("free float").
The S&P rejected proposals that would have:
Reduced the IPO seasoning period from 12 months to 6 months
Waived profitability requirements
Waived minimum public float requirements
This means that the earliest SpaceX (as well as Anthropic and OpenAI after it) could be eligible to be added to the S&P 500 would now be June 2027.
The decision arrived as Wall Street has been grappling with a new reality: some companies are reaching unprecedented sizes before they ever enter public markets. The consultation, launched earlier this year, effectively asked whether index rules written for a different era should bend to accommodate companies that now arrive at a scale once reserved for mature blue chips in what has become known as the “fast entry” in industry parlance.
However, the push for quicker inclusion raised concerns among some investors who said rules around profitability, float and trading history exist precisely to prevent benchmarks from chasing hype. Furthermore, adding IPOs too quickly, they say, could expose passive funds to greater volatility and force them to buy shares before reliable market pricing is fully established.
Meanwhile, supporters say indexes should include massive companies as quickly as possible to reflect the market investors actually own, adding that these trillion-dollar firms can be economically significant long before they satisfy traditional index requirements.
“I am genuinely surprised,” said James Seyffart, ETF analyst at Bloomberg Intelligence. “But S&P is the market leader and they can buck the trend.”
No. of Recommendations: 1
Oh my, have I convinced Jim to take the offers below 490, for 20 billion?
I'm off to the park bro, I gotta stay healthy so I can enjoy my first brkb div in 2028!
ucmtsu,no way! Have a grand day all, go spend some IV net worth ::))
No. of Recommendations: 1
Before I forget, obviously SPY changed its thinking. So, the play is, short whatever is obligated to buy hot IPOS in the aftermarket regardless of valuations prior to one year from the close, long brkb, because Gregg doesn't figure to pay 200 xs sales, comprende amigos?
No. of Recommendations: 3
Dear brother Jim, who I love like a brother, tho my older brother is all in maga, hence he's getting very difficult to love.
It's been my pleasure to share with you the brilliance of my investing thoughts the past 25 years. I didn't mean to excite you this much, give some thought to using limit orders today.
Your pal, HClasvegas. ::))
