tag:blogger.com,1999:blog-602664611343971452.post4345686014558261782..comments2024-01-06T08:57:16.475-05:00Comments on Trust Your Instincts: Subprime security prices gain 30% as traders bet that a bigger fool will buy their positionsAnonymoushttp://www.blogger.com/profile/11316888485290662469noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-602664611343971452.post-82282367416277456802012-10-06T12:10:38.830-04:002012-10-06T12:10:38.830-04:00Actually, I appreciate that there are many investo...Actually, I appreciate that there are many investors who buy and hold till maturity. The overwhelming majority of hedge funds and traders who appear in this post do not fit into this category.<br /><br />As for your investment in these securities, I hope you end up with what you think is an appropriate level of return on your blind bet.<br /><br />I make the point that it is a blind bet as these securities do not provide sufficient disclosure so that anyone could actually know what they own.Anonymoushttps://www.blogger.com/profile/11316888485290662469noreply@blogger.comtag:blogger.com,1999:blog-602664611343971452.post-74486419799809920692012-10-05T23:44:21.995-04:002012-10-05T23:44:21.995-04:00The greater fool theory applies to many securities...The greater fool theory applies to many securities markets, and for some participants it may apply to subprime. However, there are more players in this market that hold to maturity than you think (and note that in equities markets there is no such thing as maturity). For instance, 90% of the subprime mortgage securities I own I will never sell. I'll hold them until they "pay down" a.k.a. "pay off" and I receive my final penny of principal back. Those were not purchased looking for a greater fool, rather because their cash flows represented good value.Anonymoushttps://www.blogger.com/profile/04875227481018974935noreply@blogger.com