Author Topic: Dow?  (Read 549934 times)

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Offline CalBears96

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Re: Dow?
« Reply #1665 on: December 30, 2021, 10:15:02 PM »
Any thoughts on Metaverse stocks...seems to be the rage going into 2022?
I’m not sure as I haven’t done research about the metaverse. But my god can you believe that the s&p 500 is up 27%?!?! There’s still two trading days left. But goes to show that staying the course ends up working out. The last three year returns on the s&p500 have been absolutely insane.

Ya I feel like everyone’s rich but me.  I mean I’m doing ok but not like FIRE yet. 

For Metaverse stocks just Google it, there’s tons of options out there.  I feel old when I say this thing will fizzle and nobody wants to live on their VR headset for all their waking hours outside of work.  Do they?!

Well hey maybe less traffic and shorter wait times at Din Tai Fung?  Trying to think of some positives here.

There was a question "How do you becomes so rich", then he replied, "I always get out of the market a bit early"  :) You are richer than you think.
I would argue staying in the market would make you more $ than jumping in and out of it. No one can ever time the market correctly. Also, paying taxes on gains isn't a good idea.

I completely agree. Had I stayed in NVDA, AMD, and AAPL, I would have made a lot more and pay 15% tax instead of 35-37% tax.

Offline CalBears96

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Re: Dow?
« Reply #1666 on: December 30, 2021, 10:36:31 PM »
And most of the time it was because I wrote some untimely calls that forced me to sell the shares. I'm just really bad at timing the market.  :-[

Offline sleepy5136

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Re: Dow?
« Reply #1667 on: December 30, 2021, 10:47:51 PM »
Any thoughts on Metaverse stocks...seems to be the rage going into 2022?
I’m not sure as I haven’t done research about the metaverse. But my god can you believe that the s&p 500 is up 27%?!?! There’s still two trading days left. But goes to show that staying the course ends up working out. The last three year returns on the s&p500 have been absolutely insane.

Ya I feel like everyone’s rich but me.  I mean I’m doing ok but not like FIRE yet. 

For Metaverse stocks just Google it, there’s tons of options out there.  I feel old when I say this thing will fizzle and nobody wants to live on their VR headset for all their waking hours outside of work.  Do they?!

Well hey maybe less traffic and shorter wait times at Din Tai Fung?  Trying to think of some positives here.

There was a question "How do you becomes so rich", then he replied, "I always get out of the market a bit early"  :) You are richer than you think.
I would argue staying in the market would make you more $ than jumping in and out of it. No one can ever time the market correctly. Also, paying taxes on gains isn't a good idea.

I completely agree. Had I stayed in NVDA, AMD, and AAPL, I would have made a lot more and pay 15% tax instead of 35-37% tax.
15% + the state which in california is 9%+ with no difference between long/short term.

and yeah, I personally don't do options, it's way too risky even though my portfolio is risky as is haha.

Offline zubs

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Re: Dow?
« Reply #1668 on: December 31, 2021, 10:52:45 AM »
So here is Nancy Pelosi's moves in DEC 2021 in the stock market.
https://disclosures-clerk.house.gov//public_disc/ptr-pdfs/2021/20020106.pdf

Do you think buying leaps is a good idea?
Should I just follow what she does?
I think a lot of people are doing it now.


I'm thinking of putting $10,000 into it and trying out her husbands option plays for 2022.
1+ year call options called leaps.

Offline USCTrojanCPA

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Re: Dow?
« Reply #1669 on: January 01, 2022, 10:54:02 AM »
So here is Nancy Pelosi's moves in DEC 2021 in the stock market.
https://disclosures-clerk.house.gov//public_disc/ptr-pdfs/2021/20020106.pdf

Do you think buying leaps is a good idea?
Should I just follow what she does?
I think a lot of people are doing it now.


I'm thinking of putting $10,000 into it and trying out her husbands option plays for 2022.
1+ year call options called leaps.

Not a fan of buying leaps.  Why not buy the stock and sell covered leap call options?
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Offline Ready2Downsize

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Re: Dow?
« Reply #1670 on: January 01, 2022, 11:08:16 AM »
So here is Nancy Pelosi's moves in DEC 2021 in the stock market.
https://disclosures-clerk.house.gov//public_disc/ptr-pdfs/2021/20020106.pdf

Do you think buying leaps is a good idea?
Should I just follow what she does?
I think a lot of people are doing it now.


I'm thinking of putting $10,000 into it and trying out her husbands option plays for 2022.
1+ year call options called leaps.

Not a fan of buying leaps.  Why not buy the stock and sell covered leap call options?

Someone did a study years ago (when we had the radio business channel which probably no one on TI even heard about because it was so long ago) that looked at buying deep ITM leaps vs. the stock outright and said they were surprised to see that it outperformed buying the stock (because it's got very little premium to it and allows you to control more shares). If it's up, you can sell some of the leaps and use that to pay for the shares.

Of course stocks had splits then so there wasn't any stocks valued at $1000.

Offline zubs

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Re: Dow?
« Reply #1671 on: January 01, 2022, 12:31:28 PM »
I don't trade options, but I just applied to do so on my trading account.
As a beginner, I will risk a small percentage of wealth to learn.  Paying my tuition if you will.
I thought I would start by copying Pelosi's moves.

Google says covered calls limit upside potential.

I read from the internet this LEAP strategy is better than just buying stock and waiting.

So perhaps we should use the GOOG leap Pelosi is using in her DEC disclosure.

She paid about $990,000 for 10 call options expiring on 09.16.2022 with the ITM (in the money) strike price of $2,000.
1 call option = 100 shares.
GOOG was around $2,900 / share on that date.

2,900 - 2,000 = 900
900 X 1,000 = 900,000

So now GOOG goes up $1.00 Pelosi makes $1,000

If you just straight bought GOOG with $950,000 you would only get 327 shares, so if GOOG goes up $1 you get $327

I don't know how to options trade, but I want to write it out so you can poke holes in my thinking.


So instead of 327 shares, you are buying 1,000 shares using leaps. 

« Last Edit: January 01, 2022, 12:42:59 PM by zubs »

Offline zubs

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Re: Dow?
« Reply #1672 on: January 01, 2022, 12:51:38 PM »
Forget the above.  I'll just copy the WSB post:


https://www.reddit.com/r/wallstreetbets/comments/rspxmv/nancy_pelosi_latest_trades/

Quote
Look at Pelosi's option play. Right now at the time I am typing this, 9/16 2000C on GOOGL cost $97430/contract. GOOGL is trading at 2933. The intrinsic value of the contract is $2933 (current share price) - 2000 (strike price) = $933 x 100 = $93k. Look at the price of the option - it is $97430, meaning time value is only worth about $4k while the intrinsic value dominates the price of the option (it is worth $93k). Pelosi doesn't give a shit about theta, IV, etc. etc., she's playing the intrinsic value of the options contract.

Delta on her 9/16 2000C is about 0.9, meaning for every $1 GOOGL goes up, she makes 0.9 x 100 x 10 (because she bought 10 contracts) = $900. How many shares of GOOGL would I have to go out and buy right now if I wanted to make $900 every time GOOGL went up $1? Obviously I'd have to buy 900 shares of GOOGL, which would cost 900 x 2933 = $2.6M right now. How much did Pelosi pay for her options contracts? $990,000. See the difference? Pelosi gets to basically own the stock of GOOGL for only $990,000 using deep ITM options versus having to buy $2.6M worth of stock to make the same amount of profit per $1 move of GOOGL. It's because options are levered plays. Pelosi only gives a shit about the intrinsic value of the options contracts and isn't a degenerate ape WSB gambler who wants to play the time value premium changes for OTM options. You can use options for a lot more things than just gambling on time value....deep ITM options are like owning the stock for a fraction of the price of actually going out and buying the stock.

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Offline Ready2Downsize

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Re: Dow?
« Reply #1673 on: January 01, 2022, 01:04:04 PM »
I don't trade options, but I just applied to do so on my trading account.
As a beginner, I will risk a small percentage of wealth to learn.  Paying my tuition if you will.
I thought I would start by copying Pelosi's moves.

Google says covered calls limit upside potential.

I read from the internet this LEAP strategy is better than just buying stock and waiting.

So perhaps we should use the GOOG leap Pelosi is using in her DEC disclosure.

She paid about $990,000 for 10 call options expiring on 09.16.2022 with the ITM (in the money) strike price of $2,000.
1 call option = 100 shares.
GOOG was around $2,900 / share on that date.

2,900 - 2,000 = 900
900 X 1,000 = 900,000

So now GOOG goes up $1.00 Pelosi makes $1,000

If you just straight bought GOOG with $950,000 you would only get 327 shares, so if GOOG goes up $1 you get $327

I don't know how to options trade, but I want to write it out so you can poke holes in my thinking.


So instead of 327 shares, you are buying 1,000 shares using leaps.

Most people lose money on options. If you have the stock u have the stock. Options will expire and the commissions are higher (u can buy stock these days for no commish).

I did buy deep itm options when cvs was in the 50's. I also bought some shares but I didn't want to own more outright at the time. I gave up the dividend on the options. Of course this was a stock under $60 so deep itm was not that expensive.

My thesis was that they owned aetna (overpaid for it which left them alot of debt) and that eventually it was going to pay off. I noted that they were paying down debt, continuing to pay a dividend (suspended increasing the dividends which hurt the stock price but they never reduced the dividend), they were putting lots of money into store remodels which I went to see myself (some cosmetic while they were expanding the area the pharmacies were taking up in the stores, adding IHUBs which I actually used once myself and was pretty happy with the care there and noted that they were being utilized well) and if they could pay down debt, remodel and pay the dividend they were doing well.

Then to top it off, insiders were buying at the bottom. I bought the leaps when they were buying. The shares I bought a little before that.

The stock has almost doubled so it worked out great for me.


Offline zubs

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Re: Dow?
« Reply #1674 on: January 01, 2022, 01:09:58 PM »
As I understand it, with your LEAP, you made a lot more money on CVS than straight buying.
There must be a downside to the ITM LEAP beside not being able to collect dividends.


Plus a LEAP that is held for more than 1 year is taxed as long term capital gains.
« Last Edit: January 01, 2022, 01:27:01 PM by zubs »

Offline Ready2Downsize

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Re: Dow?
« Reply #1675 on: January 01, 2022, 01:27:28 PM »
As I understand it, with your LEAP, you made a lot more money on CVS than straight buying.
There must be a downside to the ITM LEAP beside not being able to collect dividends.

It's good if you have a trending stock that moves alot. CVS went up and down a few times and it took a while to break away (helped by closing stores and adding more IHUBs, increasing the dividend and getting a new CEO).

If I didn't own the stock, I would have just bought the stock. This was in my speculative funds. If I was really confident that it would move in the shorter term, I wouldn't have bought leaps.

If I had bought leaps on walgreens instead at that time I'd have a loss.

As far as something like google, it's so expensive, deep ITM is going to be expensive too and you have to look at the spread in bid/ask because if you want to sell it's going to cost u on both ends plus the difference in bid/spread and that might even change if volatility changes.

You can also buy/sell the leaps. So if google moves up or down $300, the deep ITM option will move "about" the same. But remember there is volatility and the bid/ask spread that will affect what you buy/sell for and as time goes on, even deep ITM options will decay the premium.

I would paper trade before committing money.

And also... beware options makers. They will jack up premiums before events like earnings. U can be right with a big move and not make anything because they will pull that premium right back out (deep itm options are less affected but I will bet there is a larger bid/ask difference before earnings).

I myself, consider options as speculative money and don't commit a large amount of money to them. You can make a lot with a little bit but u can also lose the entire thing and most people lose or else the option makers would not be in business.
« Last Edit: January 02, 2022, 02:15:34 PM by Ready2Downsize »

Offline CalBears96

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Re: Dow?
« Reply #1676 on: January 04, 2022, 03:20:40 PM »
Well, I'm trying my luck with AMD and NVDA ITM LEAPs. Bought some AMD Apr 2023 and NVDA Jun 2023 calls this morning. Let's see how that goes.

Offline Ready2Downsize

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Re: Dow?
« Reply #1677 on: Yesterday at 02:07:19 PM »
Looking at some stocks to buy.

Nvda was first on my list. I'm thinking between 195-225 is my target. Could never get there or drop even more but for now that is my target.

Going to see about some other stocks when I get some time.

Offline The California Court Company

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Re: Dow?
« Reply #1678 on: Yesterday at 03:46:50 PM »
buy Netflix after 20% drop? lol
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Offline Ready2Downsize

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Re: Dow?
« Reply #1679 on: Yesterday at 03:53:35 PM »
buy Netflix after 20% drop? lol

Lol! Less than 2% short. I won't be surprised if it's under $300 at "the" bottom. Hope the guy who bought at 641 had stops in.

 

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