Investment BS Thread - Stocks/Futures/Mutual Funds/Bonds/Commodities/Options/ETFs/401ks/Etc

Looks like a good day today. Making a lot of money back quickly with these options

 

"You can look forward to a great bear market with excellent returns, followed by a long, short, bull market where prices will fluctuate wildly while staying relatively stable. This really is the time to buy bonds, and stocks, but not bonds, because the turmoil is here to stay, for a very short time." -Analyst

 

is it better to buy in the money contracts and hope it gets "further" in the money or buy out of the money and hope it gets in the money? I realize one is likely more risky, but how much more risky is it?

 

@707tothe907

 

The REIT that was discussed a few pages back, CIM, I was wondering what you guys think would happen to the dividend and share price in a recession? I am tempted to throw a small percentage of my portfolio into it to get that 11% dividend, but I would hate to see a drastic share price drop when the next bad market hits. How bad can it get for these REITs in a recession?

Apparently they did well during the last recession: https://www.google.com/amp/s/seekingalpha.com/amp/article/4181540-reits-surviving-recession

 

Might be good to go with. I may do the same. I've been diversifying a lot more with my play portfolio and I've just been buying a few shares of each company. Which REITs are you looking at?

 

I have found a few, but CIM has a good dividend, and has actually performed pretty well as far as share price. My only concern (and I think it’s possible) would be for the share price to drop drastically during a recession. I could live with a dividend cut during bad times, but I don’t want to lose a large amount of principal.

 

Well that's a risk you take with any stock! Just don't put all your eggs in one basket

 

Amazon has been killing it. I normally stick to index funds but a few months (less than a year) I went in for a few shares of AMZN. Up 40% so far!

 

Yes, I'm not exercising. Just buying with the hopes to flip the contract. Usually getting contracts no more than a month ahead. Usually a week or two.

 

Check out NRZ. 11% Dividends as well

And they are up 30% in the last year

 

Good uptrend in share price too, I’ll have to read about this one, thanks.

 

@ThunderOne

I’ll day trade options with 2 weeks or less expiriations and long term hold options with 3-6 month expirations.

Yes they’re expensive, but find a stock your super bullish on and buy 1 call on it, around 6 months out and watch how it performs. It’s always a fun ride.

 

I always worry about the decay. To me it seems like there is less decay when the option is in the money, and you bet that it goes "more" in the money. I would assume this is less risky, correct?

 

Sorry, I’m scatter brained and realized I didn’t answer your original question.

If I’m buying a contract in anticipation of day trading it I’ll buy slightly OTM.

If I’m buying a long term contract I’ll normally buy something with high liquidity and likely ITM.

 

Check out FB, it has dropped over 20% since 4:00 as I write this!