Too Hot Investment Thread

Picked up some Fubotv at 40, sold options for 41 for 6 dollars each. Will see where that goes.

 

Lucid merger possibly tomorrow announcement. Also, roblox goes public march 10

 

How exactly do options work differently from stocks?

 

There are different ways of trading options. The option trading we do entails selling a contract that gives the buyer of the contract the right to buy the stock at a price named in the contract. The contracts have expiration dates and if the buyer of the contract does not exercise his right to buy the stock at the strike price named in the contract the stock remains in the hands of the person who hsold the option.

Last month, before the GameStop insanity and the surrounding publicity, Trucker purchased 400 shares of that stock on a hunch. He bought the shares at 40 and immediately sold options to two different buyers for $41 at 6 dollars per share. He still owned the stock but was contracted to release it to the buyers of the options for $41 dollars if the options were exercised before the option contract expired.

When Game Stop began to make its insane climb we fully expected to lose all of it to the buyers of the contracts, and in fact one of the buyers did exercise his option and likely made a big profit. Strangely, the other buyer never did exercise his option and lost the opportunity to make a huge profit. Not knowing what was going on with the buyer of the unexercised 200 shares we had to honor the contract and had to watch the stock fall back near the strike price before we could sell it without fear the contract buyer would claim the contracted shares at $41. He never did so we sold it at $43.

Sold 200 shares for $1 per share more than we paid for them, but also gained $6 per share by selling the options. And another 200 shares bought at 40, options sold for 41 @ $6 a share, retaining it and finally selling it at 43. We made a nice profit, not as big as it could have been if we had never sold options on it and sold it at its peak, but we did not lose any money.

 

Cciv turned into a bid war not a proper valuation price. Im holding out until launch date and maybe a little after if it spikes up

 

And Bitcoin was down 17 percent at one point today, currently down 8 percent in the last 24 hours. It’s volatility is because it has no intrinsic or measurable value, which is why I stay clear.
And yeah, it might go to a million a coin, heck it could make that whole loss back tomorrow. It could almost as easily go down by half in a few weeks. I am just not a blackjack kinda guy.

 

You have a chance with stocks. You will lose your ass on Options ... Instead 00 on the roulette wheel.

 

FML.

Im in at a $30 average, but that still sucks. Was dreaming of pulling initial investment as it rose towards 80. Lol. Guess I'll be letting it all ride for a while.

 

It’s the old adage on Lucid, buy the rumor, sell the news. Long term if it’s well run it will be fine.
I am old fashioned I guess, but I buy things for the long term. Maybe partially so I don’t have to sweat stuff like that.

 

Or pay short term cap gains.

 

Bitcoin was basically the best performing asset the last decade and it only rises substantially against the dollar, even when it crashes, if you hold long term. I don’t hold any Bitcoin but I think a lot of old investing strategy is wasted when discussing its merits.

 

It is now down 18 percent in 2 days. Though that could of course be temporary. And yes it has appreciated massively, but the number of people who got in on the real holy blank money are relatively limited. For comparison, Bitcoin is worth less than half of Apple alone. And that’s just one stock.
And I am fine with saying that it doesn't mirror other investments, but again, how do you price it? What is a fair price for Bitcoin? If you can’t tie it to the dollar, gold, its underlying assets, its PE, its management team, its announced future plans or anything else you can use to judge its fair value, how can you say 58k a few days ago was fair, or today’s 48k is a fair price? Even if the idea is that it will become more widely accepted, great, what does that mean for the value of a virtual coin when there are many other liquid options? It can’t supplant those currencies without a large coin explosion, there isn’t enough coin out there to even remotely do so. US dollars are 37 trillion alone (over a quadrillion if you include investments), and the idea of a currency that fluctuates 20 percent a day being a safe harbor spot seems crazy.
Again, if you make money off of it, congrats, just not for me. And if it goes to a million or more and I miss out, so be it. But the day someone can tell me what a fair price is, and how they got to that price logically, maybe I will jump in. Until then, I will watch from afar.

 

Just my .02 cents, but the existence of this thread indicates that the cliff is near.

By any measure stock valuations are broadly over extended and are pricing in a future that conflicts with the economic reality of the day (debt, growth, margins, etc). The number of companies priced with any margin of safety is extremely limited, while the number of companies that would face existential crisis if the economy turns (interest rates rise, money supply decreases, international conflict) is significant.

Again, just to my two cents but I find the best time to buy is when everyone is selling - I look forward to, someday, again struggling to choose between buying all the great companies at good prices. Good luck to all.

 

Q: how can I make a million dollars with crypto-currency?

A: start with two million and get out fast.