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Old 06-20-2021, 05:05 AM
  #831  
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Originally Posted by jamesbond View Post
ok... I am still working on coffee #1, but here's the thing. You talk about tying up $21,200 buying 100 shares. Unless you are trading options there is nothing that requires you to buy/sell 100 shares. Buy 10 at a time and dollar cost average. Or just buy $6100 worth. Your profit will actually be close to the same anyway when it all washes out and you don't have a time bomb ticking. (expiration) and, if they are underwater in jan 2023, you can still hold on to them until they come back.i guess the good news is if we get a president that wants to go to economic war with china, and baba tanks, you are only out $6100. Regardless of how you try to sell this, you are putting yourself behind at the start by that same $6100. The option has to increase by that amount for you to break even. That's a long way for the dy/dx. It very well might, but then again it might not.

I'm not trying to sell anyone on anything either. But what i will say is that it sounds like to me is that you are in love with this company and that is a dangerous thing. I would urge you to take a breath. Seriously.

I used to like to watch options action on cnbc every friday (not religiously, but occasionally). I was trying to understand all those complex spreads and condors and flying wallenda strategies that they were doing and after awhile i decided it was a lot of yoga for a little bit of money. And most of it was money paid out that was dependent on movement one way or the other. Jim cramer won't talk about options other than in one of his books he says doing what you do is 'ok'. (i disagree, obviously) this stuff is not rocket surgery. Making it more complicated than it is is unnecessary.

I hope it works out for you and that you have found a hundred bagger. If you did, that $6100 worth of stock will have been worth more than the option, but hey ya gotta dance with who brung ya.

Enjoyable discussion rather than the monkey **** throwing contests usually found here.
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Old 06-20-2021, 06:06 AM
  #832  
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I'm gonna throw out another idea. Let's say you bought 30 shares at $210. ($6300). Now you are long that stock. Just decide what you want as a minimum profit and watch the stock until it gets there. Let's say you want to make $30/share. When the stock hits $250, put in a $10 trailing stop limit and let 'er run. It's on autopilot at that point and works like a champ. Now if you are right and it goes to $350/share, you have locked in your profit but it goes right along with the stock. IF there is a flash crash, you sell out and don't miss out on a great runup.

And one more question for you. How do you figure you are applying leverage with purchased ITM calls?
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Old 06-20-2021, 06:18 AM
  #833  
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Originally Posted by mispoken View Post

BTW I was looking at the wrong strikes; selling a Jan 2023 $170 put gets me $17 in premium and reduces buying power by $1700. So if assigned shares my break even is $153. If I buy the $170 call for $60 my BE is now $230.
This right here ^^^^^^^^^^^^^^ is the basics of options trading. The only other component that one needs to know about is that your time is limited and it all dies on a certain date.

I haven't looked it up, but I wonder what the Jan 2023 $170 call would have to be worth in order for to realize a 5%... 10%... 20% ROI for tying up $6100... And then what would the underlying have to be to get to those numbers. I have stated before that for the most part I don't look at percentage gain unless it is in terms of a full year because I just don't think it is all that useful unless it is repeated throughout the year.
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Old 06-20-2021, 06:41 AM
  #834  
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Originally Posted by JamesBond View Post
OK... I am still working on coffee #1, but here's the thing. You talk about tying up $21,200 buying 100 shares. Unless you are trading options there is nothing that requires you to buy/sell 100 shares. Buy 10 at a time and dollar cost average. Or just buy $6100 worth. Your profit will actually be close to the same anyway when it all washes out and you don't have a time bomb ticking. (expiration) And, if they are underwater in Jan 2023, you can still hold on to them until they come back.I guess the good news is if we get a president that wants to go to economic war with China, and BABA tanks, you are only out $6100. Regardless of how you try to sell this, you are putting yourself behind at the start by that same $6100. The option has to increase by that amount for you to break even. That's a long way for the dy/dx. It very well might, but then again it might not.



I'm not trying to sell anyone on anything either. But what I will say is that it sounds like to me is that you are in love with this company and that is a dangerous thing. I would urge you to take a breath. Seriously.



I used to like to watch Options Action on CNBC every Friday (not religiously, but occasionally). I was trying to understand all those complex spreads and condors and flying Wallenda strategies that they were doing and after awhile I decided it was a lot of yoga for a little bit of money. And most of it was money paid out that was dependent on movement one way or the other. Jim Cramer won't talk about options other than in one of his books he says doing what you do is 'OK'. (I disagree, obviously) This stuff is not rocket surgery. Making it more complicated than it is is unnecessary.



I hope it works out for you and that you have found a hundred bagger. If you did, that $6100 worth of stock will have been worth more than the option, but hey ya gotta dance with who brung ya.



Enjoyable discussion rather than the monkey **** throwing contests usually found here.
Good discussion indeed. How do you come up with $6100 of stock would be better? One just has to look at the beautiful job famed Reddit investor DFV did with GME turning $50k into $20+
Million with GME LEAPS calls

If you get the direction and velocity(strike price selection) right you are always better off with LEAPS. A little more optimistic valuation of BABA is $400. If BABA hits $400:

$6100 in shares turns into $11,600 of total value

1 LEAP:

$40,000 of value(100 shares)
-$6100 (Premium)
-$17000($170x100)

$16900 of total value

That's a difference of $5300 or 45%

The key of course is getting the trade right. That why it helps tremendously to find a company that you have conviction is undervalued. If Delta Pilot staffing was a stock price I would have have bought a LEAP Call last October with a strike price of 9,000 pilots. Sheer outrageous value like that is the tenent of my investment process.

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Old 06-20-2021, 06:45 AM
  #835  
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So, you call Tesla a story stock and yet you cite a Reddit thread as a case for buying calls because someone from that thread made tens of millions doing it. I think I’ve just about got you figured out. Best of luck on your $20million call buying conquest. It’ll make a great story, one way or another.
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Old 06-20-2021, 06:57 AM
  #836  
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Originally Posted by mispoken View Post
So, you call Tesla a story stock and yet you cite a Reddit thread as a case for buying calls because someone from that thread made tens of millions doing it. I think I’ve just about got you figured out. Best of luck on your $20million call buying conquest. It’ll make a great story, one way or another.
As usual you mostly about slinging stones and not providing any color about valuation. The gentleman I referenced bought the GME LEAPS when GME was trading in the low digits and would come up on nearly every value screen mainly due to its strong balance sheet. Heck GME was nearly a Net Net at the time. I look forward to unwinding any assumptions you have of me as we update each of our returns over the next 5 years

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Old 06-20-2021, 07:06 AM
  #837  
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If the discussion is about valuation that’s one thing. The example you gave was making $20 million buying calls in GME to support your buying of calls. You use a tweet to support a short thesis. You use a WSJ article to support a short thesis.
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Old 06-20-2021, 07:33 AM
  #838  
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Originally Posted by mispoken View Post
If the discussion is about valuation that’s one thing. The example you gave was making $20 million buying calls in GME to support your buying of calls. You use a tweet to support a short thesis. You use a WSJ article to support a short thesis.
Yet I talk about a stock(BABA) that is Undervalued by about 30%. I didn't proclaim BABA was going to $2000. Put your pitch fork down.


I have provided specific examples of TSLA's eyewatering valuation based on its Enterprise Value. You haven't provided any ideas how TSLA will not only increase earning to justify its current price, but also drive shareholder returns going forward.


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Old 06-20-2021, 07:38 AM
  #839  
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Originally Posted by Gunfighter View Post
That was the genesis of the QDRO, but it can be used in other ways. I'm contemplating pulling money out for real estate investments in 2022 or 2023. Because of the original use in divorce proceedings, I think it takes a husband & wife combo to do it. Still researching...
I'm interested in what you find out...please advise!

Found this too, divorce not required by Federal law, look about 3/4rds the way down the page:
https://www.investopedia.com/persona...dro/#qdro-faqs
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Old 06-20-2021, 08:02 AM
  #840  
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Originally Posted by Trip7 View Post
Yet I talk about a stock(BABA) that is Undervalued by about 30%. I didn't proclaim BABA was going to $2000. Put your pitch fork down.


I have provided specific examples of TSLA's eyewatering valuation based on its Enterprise Value. You haven't provided any ideas how TSLA will not only increase earning to justify its current price, but also drive shareholder returns going forward.


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Time, technology, founder.

Seem over simplistic? That’s because it is. Investing for the long haul super simple.

Since you like complicated and metrics how about this;

On a trailing basis TSLA is 40x EV/EBITDA. Operating earnings are growing faster than sales. This is as of May of this year, last time I looked at any of that. Of course this metric is basically useless now, since the stock price has gone up. Regardless, If this continues, by that metric, Tesla is dirt cheap. They’re not even operating at scale yet. This also doesn’t take into account optionality such as subscription revenue.

That’s the problem with metrics, and why I largely ignore them. You can find one to fit your thesis any day. They sound smart but they’re mostly created to make people feel that way.

Last edited by mispoken; 06-20-2021 at 08:29 AM.
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