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

What was your goal here? Were you buying the options in hopes of executing and buying the shares? Or buying the options in hopes that the premium would go up so that you could sell the option and make money on the difference?

 

Answered your Q as you were asking it haha

The thing is, someone could simply be trading contracts. How many people are actually executing contracts? Not sure. Obviously someone who has the ability to purchase 100 shares of something. I don't have quite that much liquidity to do that, so I prefer to trade contracts.

But dammit, now I'm looking at buying a put on Lyft at $59ish strike price. I would need $5,900 to actually be able to execute that. Pretty much as far as I can tell, only high rollers are executing contracts. Plebs like me only trade contracts. Which is pretty much gambling because you have more at stake, kinda (the time left to expire, and what the share price is doing)

 

I wouldn't want to trade them, just do the covered calls thing. I don't own 100 shares of many stocks either lol. I think I have at least that much in T, so that is the one I was wondering about. Even if it reached the strike price and got sold, I am sure I wouldn't miss out on too much upside and could just buy it back.

 

If you are going to sell call contracts, you have to have enough money to cover it at the strike, in case it reaches the strike and the contract buyer wants to exercise it. That's the only stipulation for contract sellers. I'm not 100% sure you need to actually own the shares.

 

Wait, I thought if I sold a "covered" call, then I would just need to own 100 shares of that stock. If it gets executed, I am forced to sell the shares. If not it expires worthless and I already received the premium when I sold it.

I am not trying to lose my shirt, that's why I want to get this right before even thinking about doing it.

I am even more confused now than before haha

 

Phun up 60% today
I was going to throw down some gamble money on NIO or PHUN yesterday but went into work early
oh well...

say no to pagerduty

 

yes, if you sell a contract, you need to have the shares (or money?) to back up that strike price in case the buyer wants to exercise it

https://www.investopedia.com/terms/c/coveredcall.asp

Here you go. I guess a covered call is when you sell a call below the strike? I only know about calls and puts.. I don't know about all the different types. Just know how they work in general. I would assume you would always want to sell covered calls and sell covered puts. That's just me though.

Naked calls/puts are when you don't own the stock. So it's riskier. I don't know why anyone would do this unless they were super confident an option would expire worthless. I don't know how many brokerages actually allow this unless you have some sort of liquidity in your account to back it up.

 

NIO first green candlestick in a week and a half. Really holding that $5 line.

 

i bought some near EOD

 

Judging by the lower volume, I may jump back in soon as well

 

Giddyup let's go, NIO!!

 

that $59 put option I was talking about earlier for LYFT looking mighty fine right now. Too bad I was just talking about it and didn't actually do it.

 

Holy cow, I wonder where the slide stops. Maybe in the $30 range?

 

Not sure, but now I'm eyeing a $55 put for next week. haha

 

I should have bought. Was $4.90 when I first looked, now $5.10 a week later. Not a bad run for a week. Hit $5.18 today at one point.

 

I am getting killed by my Chevron holding today. I don't know how an acquisition can be such a bad thing, considering Chevron wasn't the only one wanting to buy this company. It'll probably go right back up in the next few weeks.

 

Some big moves
DIS up putting NFLX down

Chevron down 5% but the company they are buying up 33% !

Broadcom getting ATH
SBUX getting ATH (like 5 out of the last 6 days breaking ATH)

Roku back into the 50s

 

I hold Broadcom and Chevron, they are cancelling each other out today!

Wish I had Disney, I have been watching it a while but it's too late now.

 

I finally maxed my ROTH IRA contribution for 2018... down to the wire!

 

Buying some NFlix on this dip. Will probably buy some DIS next week because I think it’ll take a small dip after the hype dies down.