Investing General Discussion
- Thread starter Furious
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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!
I don't disagree but my uncertainty and waffling on pulling the trigger has saved me a lot thus far...
Blazin
Creative Title
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Since rates have done nothing but move up how underwater are you on the bonds?
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Mist
REEEEeyore
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like 2-3k. it's no different from adding to any other position when it's down, except this one is still guaranteed to pay out something in the worst case
edit: feel free to punch holes in that logic
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Mist
REEEEeyore
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what're you talking about? bond yields will eventually come back down from where they are now. you can then sell the bonds then at a massive profit. but if you don't, you still collect the coupon payments."Why make thousands when I could make.... hundreds?"
-Dr. REEEeyore
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Mist
REEEEeyore
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Sanrith Descartes
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I took a look at the secondary market for longer dated maturity treasuries and about the best yield with a coupon available is about 4.63 with a good coupon payment (4.65). Matures in 2044.
Sanrith Descartes
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Blazin
Creative Title
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Mist
REEEEeyore
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actual bonds, with the intent to sell when rates plummet, but totally okay with holding longer durations at these rates if they don't.
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Mist
REEEEeyore
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Yeah, I got some at 4.71 this morning and I am very psyched about it tbh.
Blazin
Creative Title
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What duration? The risk with bonds is that we often don't imagine a future that is different than now, so when we are happy to get 4%, we aren't imagining a world of 8% You're happy with the rate NOW the risk is being very unhappy with it in the future OR needing the money and being forced to realize a capital loss.
My point being is to avoid the thinking "there is no downside, I'm happy to hold them" because we should never take risk blindly believing things that simply aren't true (Not saying you are)
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Sanrith Descartes
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Silicon Valley Bank doesn't understand this line of reasoning.
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Blazin
Creative Title
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Blazin's Covered Call Newsletter
10.29.24
At the October expiration LOW's $270 calls where $12 in the money, OOF what a disaster. So what did we do? We rolled them out a month and sold the $270 strike 11/15 call for $14.81 and paid off the Oct call for $12.06 a net credit of $2.75. Roll forward a week and a half and those calls are now at $3.35 and are looking strong to expire worthless.
Same story for AMZN a month or two prior when it zoomed past a strike. This process of managing your way out of calls that expire in the money is crucial to the strategy working, especially when in a taxable account as these are. It's hard to predict surges, but surges don't last and when selling options time is on your side. time=premium.
So don't just let those shares go.
Call WATCH!
GOOGL $185 strike
AMZN $210 Strike
AAPL $245 Strike
TSLA $285 Strike
All 11/15 exp
10.29.24
At the October expiration LOW's $270 calls where $12 in the money, OOF what a disaster. So what did we do? We rolled them out a month and sold the $270 strike 11/15 call for $14.81 and paid off the Oct call for $12.06 a net credit of $2.75. Roll forward a week and a half and those calls are now at $3.35 and are looking strong to expire worthless.
Same story for AMZN a month or two prior when it zoomed past a strike. This process of managing your way out of calls that expire in the money is crucial to the strategy working, especially when in a taxable account as these are. It's hard to predict surges, but surges don't last and when selling options time is on your side. time=premium.
So don't just let those shares go.
Call WATCH!
GOOGL $185 strike
AMZN $210 Strike
AAPL $245 Strike
TSLA $285 Strike
All 11/15 exp
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Sanrith Descartes
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Jysin
Ahn'Qiraj Raider
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Tapped $47 premarket. This thing has an IV rank of 100 yesterday on calls. The downside risk on those calls is absolutely massive.
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