GameStop & A Bunch Of Other Stuff
The saga with Game Stop (GME) and the others has been amazing to watch play out. Who knows how far it will go or how long it will last but it is a good bet it ends badly for the last people in or the people who stay around too long. I don't claim to have any unusual insight but I can envision there being a lot more going on here than meets the eye. For example, it looks like Citadel looks to have generated a ton of revenue in the last week making a market in GME. Where part of the sentiment behind r/wallstreetbeets is sticking it to the suits, sticking it to Wall Street types, it doesn't get more Wall Street types than Citadel.
It now appears the Reddit crew believes going after silver can hurt the banks and so silver might skyrocket at least temporarily. Trying to game these market distortions isn't my trade but it should be clear that even though some of the details are different the behaviors driving these moves are not new. I would also add that if you do some reading on the GME story you will see that the starting point for this involved some very good analysis and sleuthing. The name was not chosen at random. Will this change how we do everything? That seems unlikely but don't sleep on this even if you don't plan to trade along with it. I do not plan to trade along with it. If you happen to have a name that the r/wallstreetbeets ends up going after, have the good sense to realize you were lucky and sell at least some of that holding.
I am test driving a new fund that could make it into client portfolios at some point in the future called RG Aurum+ which has symbol GLDPX. The fund just started in December but some data services show it going back much further like maybe some other fund used to use this symbol but either way it is brand new. It first made my radar because it was described as a Bitcoin fund. When I looked at it though it looks almost nothing like Bitcoin. What it actually does is target 85% gold and 15% not Bitcoin but Grayscale Bitcoin Trust (GBTC) which I own. It could be thought of as a gold fund with a Bitcoin overlay. The GBTC exposure could help it outperform gold, at least that has been the case so far but with only 15% Bitcoin, it is not a Bitcoin proxy.
It owns GBTC instead of actual Bitcoin because of current limits on funds' ability to access to crypto directly. GBTC is a woefully flawed vehicle because it is expensive and can trade at an enormous premium to the value of the Bitcoin it holds. If GBTC is expensive then it must mean that GLDPX is expensive and it is at over 2%. A cheaper competitor to GBTC is due to start trading in February, the Osprey Bitcoin Trust will have symbol OBTC and charge 0.49%. It has the same structure as GBTC so it too could trade at a huge premium.
Last year I chronicled test driving Standpoint Multi Asset Fund (BLNDX) personally and then adding it for clients after a few months. That fund was more clear to me that GLDPX is currently. My thinking may evolve of course it is still very early but if nothing else it is an interesting idea and my realistic risk with the few dollars I put in are not that it goes to zero but that gold struggles and Bitcoin has another 80% correction.
Next up, an update on my health insurance. I've been transparent about what we've done about health insurance over the years. Being self employed and not eligible for a subsidy makes health insurance through ACA insanely expensive. In the last few years we've gone with temporary insurance, which is lousy insurance, because it is very cheap. We've been able to go that route for being in good health.
I had a little health event, not even a scare, that turned out to be nothing. It was nothing, I am fine but the timing was such that if it had been something and I was on temporary insurance into the new year it would have been a pre-existing condition and not covered. It started with my annual physical in November, I should have gotten it in October but lesson learned.
So our solution is that for 2021 I am on ACA and my wife has temporary insurance. The combined premiums are about $900/mo which is a bummer but I was able to contribute $4600 into my HSA for 2021; $3600 as the regular contribution plus $1000 catchup contribution because I will be 55 this spring.
The picture is from a crazy storm we had last week. The truck is a 1941 Dodge Power Wagon that is parked on our property. We had 18 inches just on Monday the 25th and about 30 inches total. It was too much for my ATV/plow setup to keep up with so I've had to do a lot of shoveling and get help from neighbors with bigger equipment. We may have to get a plow for the front of my Tundra to be more self-sufficient in the face of larger snow storms.