Investing megathread extravaganza

[DaFace]

A place to talk about investing stuff.

[lewdog]

Originally Posted by Nightfyre

While I appreciate the sentiment, people being risk averse is why I am able to reap strong returns, and I find confidence in the ability to roll and the underlying prices I am selling versus the value of the company from a financial perspective.

My biggest risk is margin call, so I leave a healthy buying power buffer to absorb positions turning against me. I also ensure that I can take on any one position I enter with straight cash and vary expirations (to mitigate assignment risk). However, I will end up leveraged up to 4-5x underlying value by running multiple positions.

I accept that a catastrophic event like a -20-30% market-wide week might break me; however, if volatility is up, you can roll a lot further down to reduce margin requirements - plus my hope is that in that situation I can liquidate my vixy position to buy me enough breathing room to avoid forced liquidation and ruin.

The biggest trouble I have gotten into is when not sufficiently diversifying the sectors I am selling in. Admittedly, I haven't really experienced full leverage and full blown crisis yet, and this market has proven resilient, so rolling down and out has been effective in preventing losses. I have taken shares a handful of times - and generally sell calls at or above my price taken until they go away. I haven't lost money yet in any given position - but have incurred opportunity cost losses, if you will, from extending positions by rolling down and out.

Sounds like a high leverage, high risk wheel strategy to a point. The goal is obviously to keep selling puts and avoid getting assigned. correct?

One question I get from people on varying trading strategies is if you are doing it full-time or working? Many of my strategies are designed to be useful from a time management perspective while also valuing risk management since I cannot watch the market all day in real-time. Many new traders are learning/reading about strategies that maybe can't be accomplished by someone with a full-time job.

Thank you for sharing.

[TambaBerry]

Doubled my position in AMC today

[crispystl]

Originally Posted by lewdog

Jesus. How to you find underwear strong enough to hold your brass balls?!

Seriously. I don't know JACK SHIT about trading naked OTM put options (on margin too?) , but I know enough to know I would never have the balls for that!

[crispystl]

Originally Posted by Nightfyre

While I appreciate the sentiment, people being risk averse is why I am able to reap strong returns, and I find confidence in the ability to roll and the underlying prices I am selling versus the value of the company from a financial perspective.

My biggest risk is margin call, so I leave a healthy buying power buffer to absorb positions turning against me. I also ensure that I can take on any one position I enter with straight cash and vary expirations (to mitigate assignment risk). However, I will end up leveraged up to 4-5x underlying value by running multiple positions.

I accept that a catastrophic event like a -20-30% market-wide week might break me; however, if volatility is up, you can roll a lot further down to reduce margin requirements - plus my hope is that in that situation I can liquidate my vixy position to buy me enough breathing room to avoid forced liquidation and ruin.

The biggest trouble I have gotten into is when not sufficiently diversifying the sectors I am selling in. Admittedly, I haven't really experienced full leverage and full blown crisis yet, and this market has proven resilient, so rolling down and out has been effective in preventing losses. I have taken shares a handful of times - and generally sell calls at or above my price taken until they go away. I haven't lost money yet in any given position - but have incurred opportunity cost losses, if you will, from extending positions by rolling down and out.

Also, I wasn't making fun of you or anything like that. Indeed sir, I also commend your brass bullocks! I sincerely hope everyone on here makes a fortune.

[Captain Obvious]

Any smart people want to educate me/us on reverse splits?

I bought 166 shares of STAF @ 0.57 on a whim yesterday. When I checked today, I had a message saying they performed a 1 for 6 reverse split. Now I had 27 shares at 3.44.

I just looked and it's up 52% after hours and is sitting at $5.64. What a windfall, eh?

Is this typical of reverse splits? Seems odd to me, but I'll admit to being a major noob.

[Hog's Gone Fishin]

Originally Posted by Captain Obvious

Any smart people want to educate me/us on reverse splits?

I bought 166 shares of STAF @ 0.57 on a whim yesterday. When I checked today, I had a message saying they performed a 1 for 6 reverse split. Now I had 27 shares at 3.44.

I just looked and it's up 52% after hours and is sitting at $5.64. What a windfall, eh?

Is this typical of reverse splits? Seems odd to me, but I'll admit to being a major noob.

Not familiar with the stock but nearly every reverse split I've witnessed did not turn out well. I'd get a stop loss on that sucker.

BTW congrats on making $50

[Rain Man]

Originally Posted by Captain Obvious

Any smart people want to educate me/us on reverse splits?

I bought 166 shares of STAF @ 0.57 on a whim yesterday. When I checked today, I had a message saying they performed a 1 for 6 reverse split. Now I had 27 shares at 3.44.

I just looked and it's up 52% after hours and is sitting at $5.64. What a windfall, eh?

Is this typical of reverse splits? Seems odd to me, but I'll admit to being a major noob.

So you had 166 shares at .57. A 1 for 6 reverse split means that you now have 1/6 the number of shares at 6 times the price, so the value is the same. It's usually done because the stock is about to be de-listed because the price is too low. I generally pay no attention to splits or reverse splits.

Nice after-hours boost, though.

[lewdog]

Originally Posted by Captain Obvious

Any smart people want to educate me/us on reverse splits?

I bought 166 shares of STAF @ 0.57 on a whim yesterday. When I checked today, I had a message saying they performed a 1 for 6 reverse split. Now I had 27 shares at 3.44.

I just looked and it's up 52% after hours and is sitting at $5.64. What a windfall, eh?

Is this typical of reverse splits? Seems odd to me, but I'll admit to being a major noob.

Generally done for companies in trouble. Not sure on the after hours bounce but this generally isn't a financially solid company/move. But it can be done in an attempt to get listed on an exchange as well (possibly a positive outcome).

[scho63]

Originally Posted by Captain Obvious

Any smart people want to educate me/us on reverse splits?

I bought 166 shares of STAF @ 0.57 on a whim yesterday. When I checked today, I had a message saying they performed a 1 for 6 reverse split. Now I had 27 shares at 3.44.

I just looked and it's up 52% after hours and is sitting at $5.64. What a windfall, eh?

Is this typical of reverse splits? Seems odd to me, but I'll admit to being a major noob.

Reverse splits FAIL 95% of the time. They are NEGATIVE not positive.

Normal splits of 3:1 or 5:4 or 2:1 indicate a growing strong company.

Reverse splits are the OPPOSITE of forward splits and also the opposite in terms of success.

[scho63]

Originally Posted by TambaBerry

Doubled my position in AMC today

Up to 2 shares! I'm impressed

[TambaBerry]

Originally Posted by scho63

Up to 2 shares! I'm impressed

How'd you know? Should have waited a day though

[Rain Man]

Dang. It's a good stock market today and I happen to own several stocks that got hammered for various random reasons.

[lewdog]

Originally Posted by Rain Man

Dang. It's a good stock market today and I happen to own several stocks that got hammered for various random reasons.

Biotech getting crushed.

[Rain Man]

Originally Posted by lewdog

Biotech getting crushed.

I was coming in for my morning checkup thinking I was going to be happy, and then I saw the list of biggest declines. Cruise ship companies, Schwab, IBM, etc. Yeesh.

I'm still up a bit overall, but not nearly where the market is.

[lewdog]

Originally Posted by Rain Man

I was coming in for my morning checkup thinking I was going to be happy, and then I saw the list of biggest declines. Cruise ship companies, Schwab, IBM, etc. Yeesh.

I'm still up a bit overall, but not nearly where the market is.

Yeah weird day. I got stopped out for losses on quite a few trades today even though all indexes are green. That’s pretty rare for me.