Sanrith Descartes
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I know I am going to jinx myself but SPIR has made 3 straight green closes. It has only done that one other time since Sept.
Investing General Discussion
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Guest, it's time once again for the massively important and exciting FoH Asshat Tournament!
Go here and give us your nominations!Who's been the biggest Asshat in the last year? Give us your worst ones!
Sanrith Descartes
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I don't know how much cash you are working with but you could write puts on the $80 strike Fed expiry. This takes it beyond earnings so its got some risk involved but those puts are selling for 70 cents for three weeks of hold. If you did end up assigned you would get the stock at $79.30 which is a solid entry. You could cut some risk and sell the $75 strike for about 50 cent premium and a cost basis of $74.50 if assigned.
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Ya I have no idea how all of that works, so I'm not doing options. It's one of the things I need to sit down and study more and then do some investopedia trading on, but just haven't done it yet. I'm probably leaving a lot on the table, but also not making huge mistakes with it either.
Sanrith Descartes
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I agree with your thinking. However I wouldn't point you on the path of "large mistakes".
Short version: selling puts on stocks you want to own allows you to either a> get paid for selling the put and nothing else happens (thus you pocket the money) or b> you end up buying the shares at a price no higher than what you choose AND you still get to pocket the premium. The biggest risk is the stock you write ends up crashing and you get it at a lower value than you pay for it. But this is exactly the same as if you had bought the stock at a certain price and it kept falling.
One big difference is that with buying the stock at x price you own it. If you wrote a put on a stock and it sinks beyond a price you expected or if some material change happens you can just buy your way out of the option without taking the shares or roll out the option into the future and buy some time to see if the stock recovers. I am currently doing this with my MTTR puts.
Also no margin is required to write puts. Just cash collateral.
Sanrith Descartes
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I know we make fun of ARKK of late (and rightly so), but reading this and seeing the actual numbers is fucking scary.
Sanrith Descartes
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The $75 puts 3 weeks out look pretty good. The scary thing is earnings coming up. It's still like a 25% drawdown from today's close though. And ask yourself, would you buy AMD at $75 if it crated after earnings? If so, then the put play is good.
LachiusTZ
Rogue Deathwalker Box
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God damn am I constantly reminded I got off that train at just the right time.
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LachiusTZ
Rogue Deathwalker Box
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Last time I bought AMD, was at like 6$, and I sold it at like 9. So . . . prolly not. Lol
Yeah . . . I know.
Big Phoenix
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I didn't mean I thought you might be steering me wrong, quite the opposite. I just don't fully understand the mechanics involved with it, so I'm not risking my money with it until I do. I get what calls and puts do backwards all the time for instance, the numbers involved are typically a lot more than I'm playing with unless I'm completely mistaken. The time component makes no sense to me right now, and knowing when to sell or buy would be akin to your blind Tyson dart board gif from earlier.
I appreciate you trying to explain it, but I won't get it until I really sit down and study it for a while. Numbers don't come that easily to me in general, so it takes me a while to wrap my head around unfamiliar concepts.
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Kiroy
Marine Biologist
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I'd love this as i'd like to max my retirement/ira's towards the end of feb
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Borzak
Bronze Baron of the Realm
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I've seen her brought up a number of times with ARKK and such. How did she get into the position that she is in that she has a big enough name that everyone talks about her and from what people talk like she impacts them as well?
Sanrith Descartes
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I wasn't really knowledgeable about her early on. She is a woman in a male dominant industry and she day traded some stocks in the right industry at the right time. Everyone in the media pumped her as the next coming because she is a woman. Maybe she is brilliant, idk. Reversion to the mean hits everyone though. Just ask Buffett.
Sanrith Descartes
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Gravel
Mr. Poopybutthole
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Reversion to the mean (edit: Shit,
Sanrith Descartes
beat me to that in a reply).It's been said many, many times, but pretty much no fund manager can beat the market return long term. Sure, you get some that can beat it one year. There are a couple rockstars who beat it for maybe 3 or 4 years in a row. But they all seem to end up underperforming the market; meaning they have to have some really bad years to counteract those ones where they beat it.
I feel like there's maybe one or two people who consistently beat the market, and someone like
Blazin
will let me know who they are, but investing with them is an exclusive club.Oh, and there's Nancy Pelosi, the great Wall Street Oracle of the 21st century.
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Sanrith Descartes
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One thing to consider on returns for individuals is that it (I believe) calculates it based on total dollars gained va starting dollars (correctly so). So if you hold any statistically significant amount in your cash position for any length of time your total return is much lower than your cash invested return. It's one reason I track my portfolio in Excel and update it daily.Reversion to the mean (edit: Shit,
It's been said many, many times, but pretty much no fund manager can beat the market return long term. Sure, you get some that can beat it one year. There are a couple rockstars who beat it for maybe 3 or 4 years in a row. But they all seem to end up underperforming the market; meaning they have to have some really bad years to counteract those ones where they beat it.
I feel like there's maybe one or two people who consistently beat the market, and someone like
Oh, and there's Nancy Pelosi, the great Wall Street Oracle of the 21st century.
But yeah, over time the indexes > people well over 90% of the time.
Kahneman's work on the subject is a great read.
Daniel Kahneman: The Illusion Of Skill In Investing
In Daniel Kahneman’s book – Thinking Fast and Slow, he provides some research that exposes the illusion of skill in investing. Here’s an excerpt from the book: Some years ago I ha…
acquirersmultiple.com
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I sure do believe in reversion to the mean. Its a shame I was not a more experienced investor when I started actively investing RIGHT at the same time Covid hit. Everything just went up and up, made wild gains in two day trades, etc.
Then last year hit, I stayed at the table too long and lost all my wild gains plus a good 15 percent into the negative overall. Much happier now that I've trimmed most of my meme stocks and went deeper into the big boys. I'm still not where I need to be, and probably more pain to come for me as I unwind more shitstocks, but i've stopped doubling down hoping for "one last win".
I should have stuck to my original plan of restricting active trading to my Roth and self directed 401k and kept my main account as a index. All those taxes I could have saved too (but then again I ate huge losses in December to tax harvest against my wins so taxes won't be a huge issue now).
Then last year hit, I stayed at the table too long and lost all my wild gains plus a good 15 percent into the negative overall. Much happier now that I've trimmed most of my meme stocks and went deeper into the big boys. I'm still not where I need to be, and probably more pain to come for me as I unwind more shitstocks, but i've stopped doubling down hoping for "one last win".
I should have stuck to my original plan of restricting active trading to my Roth and self directed 401k and kept my main account as a index. All those taxes I could have saved too (but then again I ate huge losses in December to tax harvest against my wins so taxes won't be a huge issue now).