High Leverage Investing

[Amadio]

Interesting question.

Turbo warrants on the ASX and ultra short/ultra long ETFs in the USA were my most leveraged investing.

The increased leverage didn't seem to require a higher level of skills however - just adrenaline and trigger fingers.

I came out ahead but look back and think I was nuts. It wasn't investing - it was escapism.

On the other hand it sounds as if property options needs considerable knowledge and understanding to be successful.

 

[evand]

Why do you have this belittling, sarcastic attitude toward a valid question from Mark?

We paid a total of $4 for the options (four dollars)..... and yes we have invited even those little mousy mum, dad investors with no skills (or ability to learn) to property options seminars.... naughty naughty... I'm going straight to time out now.

 

[Ace in the Hole]

Creating wealth is about leveraging your money to buy/control more with less.

We turned 12k into about 2.5 mil in about 5 years, no leverage or borrowings.
Simply reinvested some of the early profits, but then all cashflow after that.
This is in business, not property.

 

[alexlee]

However the higher the leverage, the higher skill set you need.

What's the difference in skill needed to buy a property at 80% LVR, compared to 90% LVR? None, as far as I can see.

 

[coastymike]

Those who listened to Storm Financial advisers were also highly leveraged. Look what happened to them.

 

[willair]

What is the most highest leverage vehicle you have ever used in property, business, shares or other and actually pulled off the ground?

This is the question soap box speakers ask all the hopefulls,just too test their mindset,and everyone has a different idea as to what constitutes a good short-term high risk investment,but you already know that..
And why don't you answer Mark.s Question,,

 

[coastymike]

$4 for 1,000 options. And how much are you on-selling these options to the mums and dads ? Or are you just telling them how they can also purchase property options ?

Most mums and dads investors do not have the business or social skills required to acquire property options. I have a number of property developers as clients who aggressively acquire land through property options. Some of these deals take months and months of negotiating. I would say for every deal that succeeds about 10 do not proceed. For mums and dads with normal jobs they won't have the time or skills required to make it work. Sure you will make it sound great at the seminars and the seminars will probably generate you a decent income but for the average bear it is very difficult.

Not saying it can't be done. But what is often neglected at these seminars is the mindset, skills and time required to make these deals work. Talk to any medium to large property developer and you will find out very quickly that it isn't that easy.

I am also curious if you can purchase 1,000 options for $4 why the need for the seminar ? Is this to entice people to purchase the options from you ? is it really not that successful that you need the seminar dollars ? and please don't tell me it is so you educate the mums and dads into wealth. I find that altruistic wording to be absolute nonsense. If that was truly the case the seminars would be free and there would be nothing to sell either now or in the future. It would just be a kind person offering advice. With the internet and uploading of videos etc that could easily be done on a website.

I love how seminar presenters say but "yes others are doing it all you need to do is change your mindset and you too will be rich". Well I could run a seminar saying "change your mindset. The reason you are not a successful professional poker player is because you haven't got into that mindset. Just change it and you too can win the $1m prize on the World Poker Tour. Want to get rich. No problems. Head back to school and train to be a neurosurgeon. The world will be your oyster. Or maybe the problem is that you aren't a dictator. Get the right mindset. You too can be like Kim Jong-Il and rake in those billions from foreign aid. Become a russian ogliarch and steal oil from the state and onsell on the open market for billions. The only thing stopping you from becoming a billionaire is the greasing of money to the politicians. Afraid. Don't worry in our one day seminar we will teach you everything you need to know about offshore structure for your secret oil trades, greasing the palms of union officials, providing cheap housing and food to keep your cheap labour force and all the tips and tricks used by the KGB to extract information for your oil trades" Ohh how easy it all sounds

 

[Dazz]

Hi Coastymike,


I just read your footer. I'm not quite sure all of that was for information purposes only.

 

[coastymike]

Dazz

Of course it was. Just trying to make you think I'm on your side so you can trust me and then come along to my wonderful seminar. However if you want to discuss the liechenstein structure to hold the shares in the swiss trading company so we can hide those shady deals then that will cost you a pretty penny.

 

[evand]

Nail. Hammer. Head. Great post. Kudos.

$4 for 1,000 options. And how much are you on-selling these options to the mums and dads ? Or are you just telling them how they can also purchase property options ?

Most mums and dads investors do not have the business or social skills required to acquire property options. I have a number of property developers as clients who aggressively acquire land through property options. Some of these deals take months and months of negotiating. I would say for every deal that succeeds about 10 do not proceed. For mums and dads with normal jobs they won't have the time or skills required to make it work. Sure you will make it sound great at the seminars and the seminars will probably generate you a decent income but for the average bear it is very difficult.

Not saying it can't be done. But what is often neglected at these seminars is the mindset, skills and time required to make these deals work. Talk to any medium to large property developer and you will find out very quickly that it isn't that easy.

I am also curious if you can purchase 1,000 options for $4 why the need for the seminar ? Is this to entice people to purchase the options from you ? is it really not that successful that you need the seminar dollars ? and please don't tell me it is so you educate the mums and dads into wealth. I find that altruistic wording to be absolute nonsense. If that was truly the case the seminars would be free and there would be nothing to sell either now or in the future. It would just be a kind person offering advice. With the internet and uploading of videos etc that could easily be done on a website.

I love how seminar presenters say but "yes others are doing it all you need to do is change your mindset and you too will be rich". Well I could run a seminar saying "change your mindset. The reason you are not a successful professional poker player is because you haven't got into that mindset. Just change it and you too can win the $1m prize on the World Poker Tour. Want to get rich. No problems. Head back to school and train to be a neurosurgeon. The world will be your oyster. Or maybe the problem is that you aren't a dictator. Get the right mindset. You too can be like Kim Jong-Il and rake in those billions from foreign aid. Become a russian ogliarch and steal oil from the state and onsell on the open market for billions. The only thing stopping you from becoming a billionaire is the greasing of money to the politicians. Afraid. Don't worry in our one day seminar we will teach you everything you need to know about offshore structure for your secret oil trades, greasing the palms of union officials, providing cheap housing and food to keep your cheap labour force and all the tips and tricks used by the KGB to extract information for your oil trades" Ohh how easy it all sounds

 

[Token Funder]

Xenia,

Given....

I was trading options (mainly option writing) for a few years, I made and lost alot of money but overall ended up with a loss and alot of wasted time!

Options on shares is a billion dollar business, but so is teaching options trading. Gurus tend to preach it as a thing that you do in your spare time to make money. Then put the money into real estate.

After trying it out, I think nothing could be further from the truth.

It is like starting a small business, you need hefty training, you need lots of time and you need a large capital, if you dont have at least $50,000 trading capital that you are prepared to loose DONT BOTHER!!!!

Gurus will tell you that you can do it with less, even $10,000, but the truth is that even a small wiggle in the market can devistate an undercapitalised options trader, even if they are good! The most successfull people I know that do this full time and make money have capitals of $5 million or more!!!

If you are a property millionaire with alot of spare time and disposable income, by all means go and learn the trade! If you dont make it, it wouldnt matter. If you are depending on the income or cant afford to loose money, Keep the hell out of something as volatile as trading Options. You will just be wasting your time and money! Remember most businesses loose money while they are getting established!

One of the best books I can recomend is Trading for a living by Alexander Elder!

...what's with the breathless enthusiasm for options spruiked in your link?

 

[jaycee]

If you are depending on the income or cant afford to loose money, Keep the hell out of something as volatile as trading Options.

and then
Mark, mum, dad shmad fad. How could you possibly know that? Have you ever attended a seminar put on by me? Who are you calling mum, dad investors? your point of view is just as valid as anyone else's but not one that I share.

My view is that everyone has the innate ability to change their life and increase their mind and skill set...... "


We paid a total of $4 for the options (four dollars)..... and yes we have invited even those little mousy mum, dad investors with no skills (or ability to learn) to property options seminars.... naughty naughty... I'm going straight to time out now.


Wow So you DID know that they are not for the mum & dad (see the line about money you can't afford to lose keep out of it and if you're a property millionaire do it if you like ), but you DID flog them to the average mums & dads,

Then you told Mark, no they are not the average mums & dads




Right, straight down the line, nothing sneaky going on here

 

[Corey Batt]

Oh lol....

 

[coastymike]

I think that is appalling to be running seminars on options (or any seminar) when the person running the seminar doesn't believe they work, or work for those with the relevant experience, and in fact has demonstrated through their own experience that it resulted in a loss.

In my view this is not about education on options it is about a high priced course. Sharelord, which seems to be the program being promoted through the seminars, is effectively an affiliate program for options trading. What this means is that someone else creates the course, programs, etc and you then on-sell the product and receive a commission.

I have no issues at all with that but be very frank and honest about it. e.g. "I have never made any money from options and in fact have lost money. However some people have made money and this course may help you. It will cost you XXX dollars and I will merely be a trainer supporting you to use the program and in exchange I will receive a commission on sale. Based on my own experience however I do not believe that options generally provide what you are looking for and therefore this course may be a waste of money"

 

[redwing]

Sharelord (Nik HALIK & Financial Freedom Institute ) is for options on shares?

Though Xenia's group may be an authorised licensee of the program and involved in it's promotion? There seems to be a number of them out there

 

[Intrinsic_Value]

Why do you have this belittling, sarcastic attitude toward a valid question from Mark?

Given Xina's opening thread comment, i would think its probable that the underlying intent was as a marketing strategy for her websites. Especially this one:

http://www.wze.com.au/index.php?/events/what-is-financial-freedom-to-you

When confronted with opinions that she has previously posted, it backfired, so off into the sunset with this thread.

Maybe this thread should be used by students as to how NOT to market over the internet.

By the way i dont think a certain
Mr George Fokas
Global Wealth Mentor

would be too happy either.

 

[coastymike]

If someone is making so much money from sharelord strategies why would you want to be a licensee ? http://www.sharelordlicensee.com/ Ohh that's right to help all those poor mums and dads become as wealthy as you.

 

[Ridin-High]

ohhhh man i love it when a con gets exposed, someone should save this thread on their PC or something before the thread starter gets it deleted.

My biggest leverage tool is property options - we have over 1000 blocks under option very cool to see how the big players do it. It's a real eye opener to see those huge corporations purchase entire neighborhoods under option. .

Replace the bolded part with "Peoples ignorance"

I know their is a few others on here as well, time will get them

 

[sash]

LVR is different from LMI....I do keep my LVR at below 40% without fail.

But when I borrow money...I always try to finance as much of it as poissbe. These days LMI can work out cheap.

If you buy well the LVR drops....say you bought something for 100k and financed 95% of it....that means you have borrowed 95k. The LVR is initially 95k....but it could be possible if you bought well to have the property by worth 135k....in this case your LVR has now dropped to 70%.

Sash, I thought I read in other posts that you were not a fan of high leveraging , that you were surprised by the level of high leveraging of some people, and that you liked to keep your LVR below 35%.

 

[yadreamin]

We turned 12k into about 2.5 mil in about 5 years, no leverage or borrowings.
Simply reinvested some of the early profits, but then all cashflow after that.
This is in business, not property.

Thats not a bad effort Ace in the Hole.
You should be pretty pleased with yourself
well done
cheers