Investing General Discussion

Awanka said:

It absolutely pisses me off what the FED is doing. The way they're manipulating the markets is so disgustingly unethical, with no oversight to speak of. What can you do but buy stonks though? Invest in clownshoes.

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Agree completely. We're entering some sort of economical fairy-tail land that I think has no equivalence in history. Since this is all a new world, I really think nobody has a firm idea on where all this free cash will truly end up. And as for who will pay for it... I mean the treasury could in theory just issue all of its bonds to the fed and the gov can run for free.

This really is a new form of socialism, but maybe it will work this time.

Reports of an existing steroid having positive Coronachan impact during human trials in UK. 2000 given drug, 4000 not. Those who were on ventilators were about 25% less likely to die. Those not on ventilators were 20% better off than those who didn't get drug. The steroid is widely available and cheap. Markets go wild. Also Trump discussing a 2 Trillion dollar infrastructure package.

Hateyou said:

Number of employees...5. Wtf, how do I become number 6?

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Its why I like this model. They are basically a private equity company that only funds late stage drug trials for royalties. Its really a financial company. Doesnt need a lot of employees or overhead. This "could" be a long term cash cow. And this type of animal has a place in my portfolio at the right price. Pricing could get weird. It may be better to sit out IPO week. People will pump this like all IPOs but it doesn't have that growth component so I can see its price settling back down once people realize its more of a steady cash company and not a Zoom or Roku. The good thing is based on its model its financials should be very transparent.

Small caps tend to do best once a economic crisis is well in the rear view mirror, a year or so down the line. They can be a fine investment long term, but generally the S&P is the safest and all around best preforming index, and really should be at the core of a retirement portfolio. It often is not the best investment in any given year, but it almost always is a better than average investment, which really adds up over time.

Sanrith Descartes said:

New IPO out tomorrow. Different sort of company. RPRX. Royalty Pharma.
They invest in late stage clinical trials in exchange for a share of the drug royalties if the drug hits. They have a 45 different drugs they are gaining royalties from including big drug names from JNJ, ABBV, VRTX and BIIB.
They have been around since 1996 and make a profit and have positive free cash flow. They plan to open with a 2.3% dividend yield. IPO is priced in the 25-28 range.

Do your own due diligence.

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Well my limit orders got shot past so waiting a while to see if things calm down. Thanks for the heads up though company looks solid.

Bobalicios said:

Well my limit orders got shot past so waiting a while to see if things calm down. Thanks for the heads up though company looks solid.

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I like the company and the financials. I dont like it at the price today. I like it under $30. I think there is going to be a time down the road when this settles in after the IPO flippers bail on the quick profits. I'll wait for it.

I know some of you are trading in the airlines/cruise lines so I am passing along a strategy you might want to consider. Using covered calls to make some additional money. If you understand this strat then just ignore this post.
NOTE: this requires level 1 options action on your account. If you dont have it just request it. I "believe" level 1 is available to anyone and this requires only level 1 options.

So here is a hypothetical example. You bought CCL at $18.00 a share. You hold 100 shares. Note this requires a minimum of 100 shares and works in blocks of 100.
Assume you would be comfortable selling at 27$ a share (50% profit). You can sell a covered call using your 100 shares as 1 contract when the price spikes up. Today its up around 21$. So you sell a covered call for 27.50 strike price with an expiry of 7/2 (16 days). It sells for about 60 cents. So you make $60 instantly selling the call option. Now a couple of things can happen. 1. The price drops 10 -25% due to <insert random market events>. As the price drops further away from the strike of your option it goes down in value. If it gets down to say 30 cents you can buy one at 30 cents to covered your net short position and close out your option making 30$ profit. As soon as the stop price does its magic spike back up into the $20's you just rinse and repeat.

Another thing that can happen is the stock meanders sideways for 16 days and never goes below 20 and above 27.50. The option expires worthless and you keep the $60. Rinse and repeat.

Finally the stock can skyrocket and when it hits 27.50 it gets exercise and you sell it automatically for $27.50, plus you already made the 60 cents for the option so you actually make $10.10 a share profit from your $18 a share purchase. Since you were happy selling it at 27, you are even happier to sell it at $28.10.

The high implied volatility of these stocks means the options pricing is exceedingly high so this strat is quite profitable. Multiply the examples above by each block of 100 shares you own.

Now go forth and make $$$ for nothing more than owning a stock you already own.

Ps.. dont so this on stocks you dont want to actually sell or at a price you really don't want to sell at. As long as you are net short on the covered call, you cant sell those 100 shares of stock.

Yes, there is an inherent risk the further out you sell the option in time that it shoots to $100 and you still have to sell it at $27.50. If there was no downside it wouldn't really pay anything.

Yea made a bunch of premium on Aal in April when things were all over the place doing that. If you were worried about it going to 100 could always buy a call with some of that premium at higher strike and stay profitable right?

Bobalicios said:

Yea made a bunch of premium on Aal in April when things were all over the place doing that. If you were worried about it going to 100 could always buy a call with some of that premium at higher strike and stay profitable right?

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Yeah you can always roll out and/or up if needed.

NCL announces no cruises until at least October. All the cruise lines getting crushed after hours. Down 10-15% so far.

This is why I suggested that covered call strat with the travel companies. Play the volatility to your advantage.

Jysin said:

GOT DAAAAAAAAM

NCLH - Norwegian Cruise Ord Stock Price - Barchart.com

Norwegian Cruise Ord stocks price quote with latest real-time prices, charts, financials, latest news, technical analysis and opinions.

www.barchart.com

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"rating: Moderate Buy".
Bwahahahaha.

Screw Coronachan. You want a black swan event that could seriously tank the market? Here it is. I would keep a sharp eye on this. I would also take a long hard look at your risk levels right now in your holdings. This is two nuclear powers having a border skirmish. Odds are nothing serious comes of it. But Mr. Market absolutely hates uncertainty. Stop loss orders are your friend.