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

Being a fool can be costly

 

I read this the other day...he's an ass for not at least selling calls and then buying puts to collar his position or buying some ridiculously out of the money puts at like a 30% loss position to protect for nearly no money...

 

BTW 401K gate
My 1 week return is 16% on my 401K gamble

 

Remember those NVDA June 17 $290 calls? I sold 9 of 12. I'll sell two more before expiry. The last one I am going to exercise. I want those 100 shares so I can write way out of the money covered calls on them. You know what premium NVDA demands for its premiums so it's worth it for sure.

 

honestly I don’t feel bad. Diversify diversify diversify. Rising tide raises all boats etc. right now I’m “all in” on my Monopoly money on nrgu but my boring stuff is either with betterment or beginning to diversify in my 401k, as well as considering self running my boring betterment stuff etc. and even then I’m on index funds, so that’s an even further diversification.

all in on one stock for everything is silly. Sure if I went all in on htz I’d have made like 250k this week instead of $100 but the airlines could have not gone up, travel would have remained pessimistic, and htz would have gone from 0.88 where I got in to 0.55 and then gone to 0 when HTZ restructures and goes kaput. So. Diversify. High risk high reward I guess.

 

I should have went all in on NRGU, but kept DKNG.

 

lol if I knew how the market would perform ahead of time I’d make a lot of money. Hindsight is 2020 I’d have made bank on HTZ. But. Not going to risk my life savings in a bankrupt company.

 

I love the quote from the peanut gallery: “You still have over $12k left, come back tomorrow and finish the job,”

 

Thank you for supplying the link to the book. I will have to give it a read. I am fine with the money in the account. Typically with stocks, I find my stock and hold for a year and 1 day and sell. I am going to have to devise a plan for options as well since all mine will be ~1-2 month holds. That is what I a currently thinking anyway right now. (as far as the time line).

 

Don't get caught up in holding options for x amount of time. Unless you go a year out with LEAPS you'll be paying short term gains regardless. Set your target for profit, set your accepted loss, then trade those. If you have 60 days till expiry and it meets your profit target in 10 days, sell. If your still bullish wait for a dip and buy the same contract again. Wash, rinse, repeat.

 

Thanks for the advice. I will have to set my exit strategy and just have to live with it. Meaning probably 10 percent and up for the day. Can't complain with that IMO

 

Exactly. You can set trailing stops on options just like you can on stock. I tend to do that by setting my loss tolerance. If I'm willing to accept a 20% loss I buy the option contract(s) and as soon as they fill set a trailing stop on a dollar amount equal to 20% of the purchase price of the contract. That limits my loss and if gains exceed 20% makes it a break even trade at worse. There's huge volatility in options so setting anything less then 15% isn't a great idea IMO. Once it's made money you can always modify the stop loss to 10% if you want.

 

I am in a bind...I've got a DIS Jan 21 2022 $135 Call that I paid $10.10 for that's now $16.00+...I would like to sell and buy back..But it disney rides to $130 in a month or 2 it's going to just keep climbing...I must wait...

 

Set a trailing stop on the current options. Set a buy limit order on same one at whatever price you want to get in at. Should work if they both trigger. If the sell order triggers and not the buy order you might loose out on some profit. Or hold and keep a close eye on the underlying price.

You still holding those cursed VXX calls?

 

OMG disaster... -77.64% right now...I am just hoping for one BLIP of +...this is just insane..we're headed for what, 1% volatility??? The other amazing thing is YINN...it went from $10.95 to $14.77 post F.U. China speech...WTF is going on...

 

Not sure if I can feel sorry.

How about dumbing this post down a bit for those of us that are interested, but not as deeply involved in this thread?

I really like this thread, but I just don't have time to decipher some of the more cryptic posts. a little more detail will be greatly appreciated.

I'm sure others will agree.

 

market is stable now. Low but climbing very reliably and stable. No volatility.

Vxx is a short term futures etf. Or something like that. It’s how you can “invest” in market volatility (VIX) since VIX is just a measure not an actual security.

Mr Richard made an investment in expecting volatility (market can be volatile up and down too). But the market is going stable upwards and he’s losing money on that bet.

I enjoy seeing cryptic crap like that. Means there’s something for me to learn about.

 

I bought options. An option is a contract with someone else to buy 100 shares of their stock at a certain price on a certain day (the expiration day) options are named by this...so I bought the VXX Jun 19 2020 37.5 Calls for an avg price of $1.88. Since each call (contract) is for 100 shares that means $188 each contract. I have 5 contracts. So that's $940. This contract says that on or before June 19th I can buy 100 shares at $37.50 each. The present value of a share of VXX is $29.17. That means my contracts are WAY out of the money, by over $8. There's basically no chance of VXX hitting $37.50 or more before the contracts expire. You can sell the contracts to someone else to "Close the position" so right now the price (Bid) is $0.40 per contract. That means if I sell my 5 contracts I get 0.40*100*5 or $200 and that represents a loss of $940-200= -$700.
VXX is a "stock" whose price is determined ONLY by volatility of the market. If shares are buying and selling, rising and falling...quickly...the VXX share price rises..If share prices are steadily climbing, steadily falling, or just stable...the VXX loses value...So as the market has climbed over the bast 2 weeks it's done so steadily. There haven't been big rises and sell offs within the day...So VXX has gone down in price.
When I bought the options everything TO ME looked like the market was at a peak stabilization and was headed for a little volatility..when I bought the contracts on 5/29 the VXX was up $1.50 for the day or so and leaning towards increased volatility. Trump had just given a speech about china and hong kong..we're headed for riots....etc...Volatility...
Nope....
So I'm hoping by friday that we get one day of increased volatility so the bid on the 5 contracts can go up a little to maybe $0.65 or something so I don't have to eat as much ass on these damn things

 

Thanks, guys. I do appreciate the responses. And you are correct, it does compel one to search out the info. Often I don't know where to start.

 

I unloaded the ones in my individual account yesterday for a 68% loss. I kept the ones in my IRA. I'll just hope for huge news that craters the markets again. If not I'll let them expire worthless. I've got a lot of time until I need that money from my IRA so it's no biggie. The money in my individual is going into my kitchen remodel so cutting my losses there means my wife can have granite counter tops instead of tile. lol