A Townhouse in the Heart of the Action: 552 W. Armitage in Lincoln Park
This 2-bedroom townhouse at 552 W. Armitage in Lincoln Park is situated right in the heart of the Armitage social scene and is close enough to Old Town to take advantage of that neighborhood as well.
Originally listed nearly a year ago, it’s been reduced by $25,000.
It was built in 1973 but, according to the listing, the kitchen was renovated 3 years ago.
It also has central air, one parking space and a fantastic outdoor patio.
Matt Garrison at Coldwell Banker has the listing. See more pictures here.
552 W. Armitage #1: 2 bedrooms, 2 baths, no square footage listed, duplex
- Sold in September 2004 for $370,000
- Originally listed in June 2008 for $424,000
- Reduced a few times
- Currently listed at $399,900 (parking space included)
- Assessments of $140 a month
- Taxes of $3945
- Central Air
- Living room: 21×11
- Kitchen: 10×8
- Bedroom #1: 11×10
- Bedroom #2: 13×11
Too bad this place is so small, because it’s located in the Lincoln school district. Maybe a family with 1 child and no plans for more will be interested.
seems ok to me, it’s smallish, but you are a stone’s throw from the zoo, lakefront, etc.
http://imgprd.nrtwebservices.com/Chicago1/Properties/JPG_Main/850/807850_7.Jpg
Poor guy, I can hear his wife now. “We cant have a kid in the city, that is child abuse!”. He resists for awhile, but eventually her constant nagging and bitching wears him down slowly.
Until eventually one night, after a glass of scotch, he sighs and gives up the last sign that he still has a pair and gives in.
Yes, he has agreed to move….TO THE SUBURBS.
I want this place, I want this place, I WANT THIS PLACE. I looked at it last year and knew it had all we need. Heck we don’t even need the parking. I don’t have and won’t get a car. It’s just me and my little daughter and I want this place. However, I cannot afford this place.
Small but very nice, though for security I hate the 1st floor patio doors.
The price is reasonable, though many here will screem that that its not. Similar 2 bedroom condos sell for more and there is a definite premium for a townhouse.
Not everything needs to be brand new to be a good place to live
“I want this place, I want this place, I WANT THIS PLACE.”
Suzanne researched this. You can do this.
The interior is run-of-the-mill but I just love the CHA inspired exterior. Very brave.
Yeah, I am amazed how many townhomes in the city look like public housing. Where do they find architects that create that kind of stuff?
Price seems decent enough, and it does have outdoor space and parking…Smallish bedrooms though.
Hey you can use that first time homebuyers tax credit now as a down payment. Great idea realtards/govt!
http://blogs.wsj.com/developments/2009/05/13/fha-plans-to-offer-8000-upfront-to-first-time-buyers/
Is it just me or do nurseries in 2nd bed rooms scream “I’m willing to negotiate”?
It’s neat to see a place on here that I’ve actually been in! My boyfriend & I looked at this place a month or so ago, when it was still at the $419K price. Way overpriced at that amount, in our opinion, but it was kind of a bummer because it seems like a nice place. Part of our problem was the lack of storage – there’s not a lot in the kitchen, and besides that the only extra storage is the (deep) coat closet right by the front door. It has a nice large porch, but that just couldn’t compensate for the lack of storage. Also, in the master, there’s a weird… ledge, for lack of a better word, which takes up several feet of space that has little function (or at least, I can’t think of any way to use it).
Nice place. If I had $125,000 more to spend when I bought my place in Feb I would have been pissed I missed this.
I think this place looks pretty nice for the money. I love the location on this one. The kitchen seems a little small, but they did tasteful upgrades.
Sonies,
Our government has no idea WTF they are doing and they are increasingly throwing taxpayer monies at things they don’t seem to understand. The Fannie/Freddie bailout alone was estimated at “only” $25 billion last year and is up to $171.8 billion already.
Why is our government actively participating in the housing market? It seems nonsensical that given the losses already incurred they still allow these back doors to home loanership with no or low downpayments via the FHA.
So my taxpayer dollars are essentially helping some idiot buy a highly leveraged depreciating asset and who will likely be underwater within a few months.
I don’t understand why so many people, even people who don’t have a vested interest in pushing the home ownership drug like JoeZ, don’t understand that the entire problem is no or low downpayment loans.
Its simple: low downpayment loans are the problem that got us here. The only way we can sustainably get out of this mess is to require at least 10-20% down, no exceptions. If you can’t save up 10-20% you need to be renting. Its that simple.
“However, I cannot afford this place.”
Sure you can. Leverage baby! Put 3% down, get an 8,000 tax credit, and if things don’t work out, no big deal. You have a free put option, courtesy of me and all of the other taxpayers out there.
MJ,
The guvmint acted like they were getting serious with the FHA and raised the limit to a shockingly prudent 3.5%../sarcasm
But yeah with the 8k credit counting towards downpayment looks like the floodgates are open to dumb money again. At least until December 1. I’m gonna wait until the raise the credit to a bigger one. You know its coming from the brain trust in DC.
“I’m gonna wait until the raise the credit to a bigger one. You know its coming from the brain trust in DC.”
Agreed. A higher tax credit is probably coming, but unfortunately, the DC clowns will never increase the income limit. So, the upper-middle class will continue to get the shaft.
Given that some folks are wondering WHY the government can’t stay out of housing, let me share this article that someone recently shared with me;
“Obsessive Housing Disorder
Nearly a century of Washington’s efforts to promote homeownership has produced one calamity after another. Time to stop.”
It’s one perspective on the problem. Many believe that homeownership should be the goal for everyone, when frankly, owning a home is NOT for everyone, and there should be no shame in renting, or not owning if you’re unwilling, unprepared or unequipped to do so.
I think that a 2 bed/2 bath with parking for under 400K is a pretty good deal for this area of LP. However, this particular unit is right across from the fire station which could have a negative impact on the sale.
anyone know where it was listed at last year?
“I think that a 2 bed/2 bath with parking for under 400K is a pretty good deal for this area of LP. However, this particular unit is right across from the fire station which could have a negative impact on the sale.”
i dont think this is really a big deal. if anything, it makes the area safer. i lived across from a firestation in college and they dont put the sirens on as they are pulling out of the station, esp if its in a residential area.
I live 2 blocks from the RN fire station, an I can attest that they definitely use their sirens ALL the time. at least once a night. and usually once or twice during the day.
Bob if you want a good laugh read some of the comments after the article I linked. YOu’ll see such gems as
“The benefits being that it will help reduce the high inventory of homes we still have on the market. Will there be higher defualt rates on FHA loans if this provision passes? Most likely.”
and
“Absolutely. I pay as much in rent on the house I am renting as I would for a mortgage on a home of the same size or smaller but my problem is I don’t have enough money for the 3.5% downpayment on a FHA loan. If i was able to get a short-term loan against the $8000 dollar tax credit, it would definitely make it possible for me to buy a home, b/c I would be able to pay the downpayment. I desperately want to buy my first home and begin building equity, but it is extremely difficult to come up with $4000- $5000, but I would not have a problem paying my monthly mortgage…..it’s the downpayment that is holding me back.”
and
“I’m buying a home now, and it would help me if I were able to use the tax credit at closing.”… “I happen to be a teacher, and after paying rent and other financial obligations I find myself living paycheck to paycheck.”
and
“This is good news for those who cant save for a downpayment.”
and
“if I put 3.5% down on a $100,000 home and have low closing costs (total of $6,000 tops)there should be money left over!”
Here’s an idea for govt… stop giving money to IDIOTS!
while I don’t buy that the downpayment is the sole cause of all of our problems, god DAMN are those quotes revealing of some serious mental deficiency.
How is someone who can’t put up $5K for even a pitifully low 3.5% down payment going to handle the first even somewhat-major repair? It’s that inability to handle maintenance/depreciation repairs that bothers me, that’s not good.
And these are people that read the wall street journal… imagine the clowns that read USA today or something… dear god help us all!
“Until eventually one night, after a glass of scotch, he sighs and gives up the last sign that he still has a pair and gives in.
Yes, he has agreed to move….TO THE SUBURBS.”
Living in the city is a big enough pain in the ass as a single person or couple. I can imagine it would be a much huger pain having to drag a kid around.
Sonies, the WSJ has had credibility issues since Rupert Murdoch got involved…
Here’s a nice piece:
http://executivesuite.blogs.nytimes.com/2008/08/29/the-wall-street-journal-rip/
Also revealing:
http://en.wikipedia.org/wiki/Wall_Street_Journal
Its views are somewhat similar to those of the British magazine The Economist with its emphasis on free markets. However, the Journal does have important differences with respect to European business newspapers, most particularly with regard to the relative significance of, and causes of, the American budget deficit. (The Journal generally blames the lack of foreign growth and other related things, while most business journals in Europe and Asia blame the very low savings rate and concordant high borrowing rate in the United States).
So lets do some math…
first time home buyer buys a $200K condo.
For an FHA loan they need 3.5% of $200K, or $7000. No savings, no problem. Housing credit takes care of that. But what about closing costs? No problem either, sellers is happy to give a 3% closing cost credit, maybe even prepay some assessments for a full price offer.
What does this add up to? A whole new group of financially inresponsible people who couldn’t save a dime now can buy homes with absolutely no skin in the game. This sounds familiar…..
Seems we traded one idiotic principle: no need to worry home values will increase becasuse they’ve been increasing and will increase forever; for: no need to worry home values will increase beacuse they been decreasing for a long time
something seems not to make sence here..
I was one of the stupid suckers who was responsible and saved up enough for a 20% down payment. Until a few months ago, I intended to put 20% down on my home purchase, but I have officailly decided that a 96.5% LTV FHA loan is the way to go. I decided it is about time I take advantage of some of these ridiculous handouts, rather than keep paying for them.
If inflation gets out of control, I will be sitting pretty. If the housing market continues to decline as I predict, no problem…I only have $12,000 on the line (too bad I don’t qualify for the tax credit because then I’d only have 4K on the line). It’s really a win win…courtesy of the idiots in Washington.
I thought the $8,000 tax credit was for those with incomes LESS than 75K a year? How could someone making less than 75K afford this condo? I make about double this amount and since I moved to Chicago have been a VERY happy renter.
MJ,
Its not really a handout if you don’t plan on defaulting. Since you were able to save up 20% it sounds like you have a nice cash cushion to prevent running into financial distress/default and can budget well.
Of course it sounds like you’re smart with your money and wouldn’t mind defaulting if it saved you tens of thousands of dollars or more. Just get ready for the howlers on here who might disagree with your shrewd assessment. 8)
I know I am opening myself to many a comment, but here goes. I am one of the ones, who bought a fairly inexpensive condo (240K) in a good section of Lakeview, and used a no money down VA loan. I will be able to claim the tax credit, while I am just below the cutoff, and I do not feel guilty. I personally had enough money for over a 20% downpayment, however I chose to keep my savings for other reasons. I have worked very hard being in the military, so why not take advantage. Now, I have a cute home, still a very large savings account, and a very solid job. Yes, some people are financially irresponsible, but not everyone who chooses a low money down option fall into that category.
This is a tiny two bedrm unit probably suited only for “dinks” (dual income no kids) with a zen-like austere lifestyle with few possessions. It’s nicely updated and the photos show tidy housekeeping, but a six-footer would be banging against the walls and be claustrophic in no time. Unit is suitable only for someone who has recently relocated from Hong Kong, where this unit would be considered high-end luxury housing. Sorry.
as a six footer, i am miffed you consider us less able to avoid walls than shorter folk.
I forgot the link!
“Obsessive Housing Disorder
Nearly a century of Washington’s efforts to promote homeownership has produced one calamity after another. Time to stop.”
good read.
http://www.city-journal.org/2009/19_2_homeownership.html
Question for all renters…
If homeownership is not a good idea and renting is better, then why would there be landlords at all? What is the benefit to own? If it is such a bad decision to own properties (HD, G , Sabrina), who is going to own the places you rent in and why would they want to take on such a losing invenstment?
Love to hear your answer.
Steven,
While I agree with many of your comment you really over simply renting vs buying. What makes sense for one person may not be right for another. My assumption is that most on this blog are younger, not married and just starting out in the career. And if this is true, renting is probably the better choice, many will move, get married, there lives will change in the next 5 years. Why do think it is such a great idea to buy if they may sell in the next 3 to 5 years. And if these posters are looking for the highest and best investment of capital over the next five years in my opinion it will not be real estate. So I think we should stop telling HD how stupid he is……. that being said I dont’ think real estate will fall to the levels that he (HD) hopes they will.
sorry lots of spelling errors….. need my morning coffee
“If homeownership is not a good idea and renting is better, then why would there be landlords at all? What is the benefit to own? If it is such a bad decision to own properties (HD, G , Sabrina), who is going to own the places you rent in and why would they want to take on such a losing invenstment?”
Homeownership is not a bad thing. I never said it was. Are you going to live in the property a minimum of 10 years? If you can afford the monthly payment and aren’t going to move- go for it.
It’s more likely the 1 and 2-bedroom condos (or, probably, condos in general) that are more of the problematic properties.
The renters buying the 1-bedroom condo aren’t going to live in it 10 years. And if they want to move, given the still elevated prices, they won’t be able to rent it out and cover their costs.
Why buy a losing asset?
Prices continue to decline and when they hit bottom (whenever that will be) they’re going to stay depressed for decades. You home will not be an “investment” (that will be stocks, bonds and other assets). It will simply be a place to live.
So if you’re looking for a place to live, raise your family etc. then by all means go for it.
The city of Chicago is still massively overpriced compared to what you’re getting in the suburbs now- and that includes the north shore and the ritzy western suburbs like Hinsdale, Naperville etc. Some single family homes are quite the bargain in the nicer suburbs. If you’re going to be there for 10 years- it’s definitely worth the look.
I think the soundest advice comes from those saying that if you plan on buying a place only to sell it in 3 to 5 years then I wouldn’t expect to make any money on the deal.
I don’t think anyone’s decrying home ownership outright – just suggesting that in today’s market, it’s not a short term investment at all.
“Prices continue to decline and when they hit bottom (whenever that will be) they’re going to stay depressed for decades. You home will not be an “investment” (that will be stocks, bonds and other assets). It will simply be a place to live.”
What a moron! Ask a simple question and get this crap as an answer. So let’s all move to the suburbs and plan on declining assets values for the next 20 – 30 years (Decadess?). I guess inflation does not worry you at all…
There is a reason prices are higher in the best city neighborhoods and that is because it is a better place to live. People with money set price levels and they choose to live downtown. Your suburb theory is just simply wrong.
If you like cheap prices in nice suburbs why don’t you just keep heading West to Joliet? Real cheap out there Sabrina…sounds like it is right up your alley. Great rentals too! 🙂
Such vitriol. I can only guess, you being such an eternal optimist regarding real estate, that you managed to get yourself highly leveraged in the bubble and are either wiped out or on the verge of it. Tough to be the without a chair when the music stops.
Heitman: “What a moron! Ask a simple question and get this crap as an answer. So let’s all move to the suburbs and plan on declining assets values for the next 20 – 30 years (Decadess?). I guess inflation does not worry you at all…”
Have you no manners steve? You should know better than to insult your host.
“#Steve Heitman on May 17th, 2009 at 12:33 pm
What a moron! Ask a simple question and get this crap as an answer. So let’s all move to the suburbs and plan on declining assets values for the next 20 – 30 years (Decadess?). I guess inflation does not worry you at all…
There is a reason prices are higher in the best city neighborhoods and that is because it is a better place to live. People with money set price levels and they choose to live downtown. Your suburb theory is just simply wrong.
If you like cheap prices in nice suburbs why don’t you just keep heading West to Joliet? Real cheap out there Sabrina…sounds like it is right up your alley. Great rentals too! :)”
Host? Housing quack in my book!
Even aside from the “best city neighborhoods” I see other city neighborhoods not frequently called in the “best” category and the housing there is still price significantly over its suburban counterparts (20%+ moreso).
Its these areas in the city I bet will get hit the hardest.
Comparing home prices in Lincoln Park to Naperville is so naive as to destroy any credibility the poster may have had.
I didn’t say Naperville and I didn’t say Lincoln Park.
Let’s expand our horizons, shall we?
Let’s compare, say, Austin or even a neighborhood like Edgebrook with, say, Evanston or Oak Park.
It’s not even close. (Evanston, by the way, is getting creamed- at least on the condo side of the equation.) There are far better deals in many of the close in lovely suburbs accessible to great public transportation with old housing stock and nice downtowns (with restaurants, bookstores, coffee shops and movie theaters.)
Would you pay $500,000 for a ranch house in Edgebrook versus, say, a nice bungalow in Highland Park, or, dare I say it, Wilmette?
That’s your choice, as a buyer, of course. But it indicates to me that the city has far, far farther to fall. Housing prices are still way out of whack with incomes in the city.
For the buyers who want a single family home, there are great deals in the wonderful, elite suburbs right now (within walking distance to the Metra and some lovely suburban downtown areas)- many of which will take you to the loop far faster than living in, say, Lincoln Square or Edgewater. And instead of a 2 bedroom condo you can get a cute bungalow in a lot of suburbs now.
This is a blog about the Chicago market only- but many buyers looking for deals should consider the closer in suburbs. Many are on “sale” right now.
juliana,
Just ignore ol’ StevO. I suspect he is the poster child for equating debt with wealth. And while that strategy worked wonders to allow a new group of people to live a lifestyle far beyond their means for a good while, at the end of the day the banks decided that ability to repay is important again and to rein in the loans.
Much like StevO much of the rest of America is going to learn that debt does not equal to wealth the hard way too. It is funny he thinks his vitriol on here can somehow affect the real estate market. Just like our banter I doubt it has any effect whatsoever.
Sabrina, this is your house. You shouldn’t take some anonymous nobodies coming into your house and calling you a ‘quack’ or ‘naive’.
Reminds me of Dan Quayle defending Sarah Palin: “You were selected by John McCain because of who you are and what you have done, and don’t let them take anything away from you. Just go out and be yourself” 😉
“Would you pay $500,000 for a ranch house in Edgebrook versus, say, a nice bungalow in Highland Park, or, dare I say it, Wilmette?”
That’s one of the stupidest comparisons I’ve ever heard in my life. Does Hinsdale real estate have to come down because Joliet is cheaper? Maybe Winnetka prices need to drop because it’s more expensive than Detroit too. How can you run a real estate blog and post such moronic crap?
hd,
I don’t want StevO to be banned. I want him to stick around through the years. I am very curious how his situation turns out through a downturn and if he were banned I’d always be left wondering. At least if he stays I’ll be able to glean enough hints from his posts to have an idea.
I’ll say it again. If you really want to get some good prices- go to the suburbs. It’s much more affordable than anything “comparable” in the city (in comparable demographic neighborhoods.)
You’ll get much more for your money in terms of size, amenities, quality of schools, and even commute time (but that all depends on where you work, of course.)
But ultimately, short sales and foreclosures are ravaging the outer Chicago neighborhoods now and will work their way inward.
“Sabrina, this is your house. You shouldn’t take some anonymous nobodies coming into your house and calling you a ‘quack’ or ‘naive’.”
Thanks HD- but I don’t care what they call me. The housing market speaks for itself. They’re entitled to their opinions.
I agree with Sabrina here. The “elite” suburbs, such as those on the north shore, have dropped far more substantially than the better downtown areas.
“than the better downtown areas”
Ohhh touche. Sorry but when I see ppsf numbers in Albany Park and Bridgeport higher than Schaumburg I LOL loudly.
Your blue collar bungalow ain’t worth 400-450k. The only reason these idiots think it is because 1) some dumbarse bank gave one of their low/no down neighbors a loan to pay a ridiculous price at a low interest rate to set comps and 2) the county tax assessor will happily report your assessed value is a higher value to tax you more. Makes idiots feel better getting government validation of their supposed value, the sad fact is lost on them that they are the greater fool as they pay more tax. No way could they sell their place for the underlying value their property is assessed at is my guess (as of this year, assessments are being reset however).
IMO city neighborhoods should trade at a discount to the suburbs because who can afford private school for the rugrats when mammy and pappy both work a job and have a half million mortgage? They’re freakin’ toast just like that Uvillage peeps and I have the popcorn ready.
Guess what dreamers? The price you pay for a property is ultimately the most important factor on your financial future. Interest rates are bounded at zero. And if they go up or you can’t make payments your toast. Oh and if your neighbors can’t keep up with their ridiculous price your valuation is toast as well.
Hard to feel bad for people who took the green pill in 2006-2007. Heck the Economist magazine had a headline in 2005 about “After the Fall” showing a house falling on somebody. Haha!
I love reading these posts, altho I have little in common with anyone here. Live in small town Indiana, own a condo in Chgo where my large brood live during college. Being over 55, I must be the only one who remembers when a house was not considered an investment, but a home to live in & enjoy & raise a family. The fact that it appreciated was a plus but it was not counted on. I have watched as the markets boom & crash many times over my lifetime, but it seems to me that the young ones should concentrate more on finding a place to enjoy living in & getting involved in the community, rather than constantly chasing after profit. Just my opinion, not meaning to offend anyone.
Since Bob is a deadbeat anyway with a wrecked credit score, and trashes places he gets evicted from, I would take his opinion with a grain of salt. Its not like he’s active in the market of actually buying a place because no bank would touch someone with a 500 FICO… unless he saves up a few hundred thousand, which we all know that most single guys that live with their cat in studios in lakeview all have lying around.
What cat Sonies? You’re relying on some dated info, my friend.
And I don’t think you know how big of an actual deadbeat you need to be to get your FICO down that low. You need to be a serial deadbeat.
I think you have little comprehension of the credit risk of many people who were awarded mortgages at the height of the bubble. It defies comprehension.
And why would I want to be in the market for a place now? The Chicagoland Case Shiller index fell 3.5% last month, thats the FHA downpayment amount. Taking scuba lessons Sonies? 8)
“The Chicagoland Case Shiller index fell 3.5% last month, thats the FHA downpayment amount. Taking scuba lessons Sonies? ”
LOL you got me, and I really don’t care because I don’t plan on moving for at least 5-10 years! (No kids planned anytime soon, thank god because I HATE yardwork! And kids need an acre of grass, or else its child abuse!)
Also, thankfully I paid a reasonably cheap price. $285 a sqft in RN isn’t too bad for a building that was built a few years ago with a great view and everything I need! 8)
Although it is funny that my neighbor is trying to sell his studio with a view of a brick wall and no balcony for about 150k, and I recently met my other neighbor and the first thing she asked me was how much I paid for the place… She said she paid about 70k more than I did, so I lied and said I didn’t buy a parking space to make her not feel as bad because I think she’s going to try to sell soon. Awkward!
Bjean, a lifelong North Sider am I, and I could not agree more.
Bob, all it takes is a 60 or 90+ late to reduce your score into the 600’s and a recent charge off or two will easily put you in the 500’s. It’s difficult to build up your credit and easy to destroy it.
Hd,
I’ve had a charge-off of a medical bill and an Illinois fine within the past five years and they were never reported to the credit bureaus. Last I checked my score was in the low 700s, not that I take means to preserve it if I see people chasing me for a charge I don’t agree with.
I’m honestly not that worried about it as my horizon to own is ~4-5 years and chargeoffs that old don’t typically wind up affecting the score.
“Although it is funny that my neighbor is trying to sell his studio with a view of a brick wall and no balcony for about 150k”
Buy it and punch thru the wall, man. After foreclosure, of course.
I have a son in college at DePaul. I thought about buying a condo for him to live in but decided it was too risky an investment with the housing bubble still inflated. I’m not even considering it now.
If I could go back in time I would have sold my vacant land in Colorado last year. It got reassessed in 2008 and I have to pay more tax for the next two years because of bubble assessments. I’d be lucky to find a buyer right now. We originally planned on moving there and building, but have changed plans and now are just holding it as an investment property. IMO, housing is not a good investment vehicle, but we’re kind of stuck with it for now. At least we have no debt.
But for investment, I’m looking at FAZ and DOG today. Pretty cheap. And liquid, so I can use stops.
BJean:”I love reading these posts, altho I have little in common with anyone here. Live in small town Indiana, own a condo in Chgo where my large brood live during college. Being over 55, I must be the only one who remembers when a house was not considered an investment, but a home to live in & enjoy & raise a family. The fact that it appreciated was a plus but it was not counted on. I have watched as the markets boom & crash many times over my lifetime, but it seems to me that the young ones should concentrate more on finding a place to enjoy living in & getting involved in the community, rather than constantly chasing after profit. Just my opinion, not meaning to offend anyone.”
That FAZ is pretty dangerous. Its total return is so path dependent that its now at or near its 52 week low despite all that happened to the financial sector. Gambling money maybe but better to keep your eye on that racetrack.
DOG seems a lot safer as its sans leverage and so not as path dependent.
I’m surprised FAZ is legal given it basically allows excess leverage beyond the initial margin requirements (3x is greater than 2x). Guess our regulators are asleep at the wheel yet again.
FAZ is pretty cheap at a little over $5, near its 52-week. The risk is less than options. It can’t go to zero. And I make small bets on this sort of thing.
Bob: “I’m surprised FAZ is legal given it basically allows excess leverage beyond the initial margin requirements (3x is greater than 2x). Guess our regulators are asleep at the wheel yet again.”
What is a FAZ? A DOG?
exchange traded funds (bearish)
http://www.google.com/finance?client=ob&q=NYSE:FAZ
http://www.google.com/finance?q=dog
Steve A:”What is a FAZ? A DOG?”
“FAZ is pretty cheap at a little over $5, near its 52-week.”
Aka its all time low. All 28 weeks of its history.
Yeah, I know, not that sort of vehicle, but still.
I don’t see how it can’t goto zero. A 33.4% increase in the underlying financial index and the thing is zero. Might not even live to be a year old.
Its no inherent claim on underlying assets so yes it theoretically and practically can goto zero.
Theoretically, you’re right. In any case, cheap as it is, even if it goes to zero I won’t be out much, since I don’t make big bets. Better odds than a lottery ticket or real estate that I won’t lose all my money, I guess.
Bob:”I don’t see how it can’t goto zero. A 33.4% increase in the underlying financial index and the thing is zero. Might not even live to be a year old.”
Why not just buy a leap SPY or IXG straddle instead of crappy FAZ.
For the love of humanity, please don’t buy a condo for your college-aged kids to live in while they attend school. Some clueless parents bought the unit next to mine and for years their disgusting brats have been ruining the place with their loud music, screaming, crying and parties at all hours of the night and day. Put them up in a dorm or cheap apartment building where they belong.
Sorry meant XLF not IXG
Sounds okay in theory but I don’t see options listed for IXG. Also transaction costs and rebalancing every day would make it untenable for small investors to play that way. Yeah you could do strangles on the SPY but not as good as these leveraged funds for that same reason.
No way to keep vega constant with options whereas with these funds you get that as well (until they hit 0 haha).
IXG. DOG. SPY. FAZ. You’re making these all up? Right?
I
Knock $50K off the price and I like it.