I just finished preliminary screening of some great covered call opportunities for next weeks earnings. WB - Weibo Corp FL - Foot Locker, Inc. KSS - Kohl's Corporation GPS - Gap Inc VIPS - Vipshop Holdings HRL - Hormel Foods Corp HPE - ewlett Packard Enterprise Co
These companies have earnings reports coming out next week. The premiums on near the money options are at 2% or greater. WB and FL have the highest premiums percentage at 5% and 8%. This is a good opportunity to make a low risk play with decent upside. The strategy I am executing is to purchase shares in lots of 100 and sell covered calls to collect the premiums at the start of the week (or the Friday before the weekend). An example: Buy 200 shares of FL at $23.50 for a total of $4700 Sell weekly calls at $24 for about $1.50 each, net credit of $300. Possible results: Week ends at $26 (+10.6%) = $5100 ($24*200 + $300 from calls) (+8.5%) : Delta: -2.1% Week ends at $25 (+6.4%) = $5100 ($24*200 + $300 from calls) (+8.5%) : Delta: +2.1% Week ends at $24 (+2.1%) = $5100 ($24*200 + $300 from calls) (+8.5%) : Delta: +6.4% Week ends at $23 (-2.1%) = $4900 ($23*200 + $300 from calls) (+4.2%) : Delta: +6.4% Week ends at $22 (-6.4%) = $4700 ($22*200 + $300 from calls) (+0%) : Delta: +6.4% Week ends at $21 (-10.6%) = $4500 ($21*200 + $300 from calls) (-4.3%) : Delta: +6.3%
Note: When the Call is not executed, you may choose to continue to hold the stock and wait for it to rise again.
As you can see, with such a high premium, the upside for covered calls is quite high and the downside is partially mitigated. If you are expecting a drop you can sell deeper in the money calls, and if you think it will pop, you can sell higher out of the money calls. >What about capped upside? Do you expect the stock to move +10% in a week? Even if it does, you are still guaranteed profits. >What about unlimited downside? This is why you buy stable companies, its just as unreasonable to expect the company to move -10%
What do you guys think of MU as a medium term hold? I’ve heard NAND and RAM prices are rising. The new PS5 and Xbox both have SSD’s. Datacenter demand has been increasing with this virus stuff.
Cooper Rogers
ahh fuck i posted in the dead thread. to repeat in the living thread people trivialize a nuclear war. the reality is, there will never be a direct war with the PRC. it'd be suicide for both parties. even if we shoot down 95% of the missiles in the air, its still suicide. (and we're not that good at getting them down.) i think 1st world living has spoiled us so badly that we don't comprehend a nuclear war is unwinnable. we're heading into a new Cold War. the worst case scenario is some proxy war in the Pacific. maybe it'll be over the Philippines. maybe it'll be naval skirmishes in the South "China" Sea. if shit gets truly wild, there will be fighting over Taiwan. but the anons hoping for WWIII will be disappointed.
I made a killing off of puts today but I think tomorrow will be green.
Noah Sanders
Ok. Bulls are getting rekt.
Cold war 5.0
Luke Sanchez
>rollingstone.com/politics/politics-features/taibbi-covid-19-bailout-wall-street-997342/ >The $2.3 trillion CARES Act, the Donald Trump-led rescue package signed into law on March 27th, is a radical rethink of American capitalism. It retains all the cruelties of the free market for those who live and work in the real world, but turns the paper economy into a state protectorate, surrounded by a kind of Trumpian Money Wall that is designed to keep the investor class safe from fear of loss. >What’s happening in the COVID-19 crisis is the next step: a financial bubble where the Fed isn’t the cleanup mechanism, but the source of the mania itself. While the real economy is seeing record disruptions, Wall Street has seen prolonged rallies of “rational exuberance” over the Fed’s decision to usher in “QE infinity” and essentially ban losing in finance capitalism. >Investors have begun following the Fed. Analysts are encouraging clients to “buy what the Fed is buying,” because “the stimulus seems to be endless.” The boom isn’t in any particular kind of company or product, but in the Fed itself. >“The Fed is the market, and all the big players know it, while the real economy will stagger far behind,” is how Nomi Prins, author of Collusion and an expert on central-banking policy, puts it.
Doesn't sound good.
Ian Williams
but there isn't there an unlimited upside risk?
Mason Bell
Looks like "The Killers" to me, desu.
Colton Murphy
I'm very close to breaking even for all time. I was down like -45% at my max I think.
Some bullshit today though and limited my gains. >know that TVIX spikes up and retraces >sold some TVIX this morning on a spike, expecting a retrace >sold too early, it went up >huh, I guess I need to buy back in >can only buy 13 shares instead of 14 because I have a margin account >later today I turn off my margin and realize I had enough all along and that RH Gold gave me a negative margin and didn't let me buy I basically am up today like 12.45% but missed out on a good 7% of gain.
hopefully I can sell sometime tomorrow and buy back in on a retrace and get that chunk back. I turned off RH Gold forever.
Jason Carter
What happened if you end up bagholding them forever? For example, Gap looks FUBAR to me.
Feel free to play your little shitpost games, mumus and bobos. It matters not to the king, el snib snab
James Hughes
The Killers notable songs: -When You Were Young -Girlfriend -Mr. Brightside
Michael Roberts
I didn't. I was telling people to screencap my posts and either make fun of me this Friday or praise me. My game plan was to cut my losses this week if there was no reversal but I strongly anticipated a heavy dump Monday/Tuesday.
Jason Nguyen
>It retains all the cruelties of the free market for those who live and work in the real world, but turns the paper economy into a state protectorate, surrounded by a kind of Trumpian Money Wall that is designed to keep the investor class safe from fear of loss. very bullish. amerilards will never rise up against this so there's nothing to worry about
Ideally you are only holding for that week. You don't have to bag hold. Losses can still happen but as you can see you have a lot of padding. Additionally, you can find a company with less risk or greater upside, I listed 7 you can choose from in this instance.
With this strategy, you cap your gains for virtually guaranteed profit. Whens the last time a company went to infinity value though? This is where probability and standard deviation come in. A decently stable stock is realistically not going to move outside 10% in either direction in a single week.
I am very close. I would have been +7% closer if RH margin bullshit didn't happen. Negative fucking margins. Fuck you RH
I only restarted investing in late March, so hopefully I'll have 3x my money in a couple months of trading before I reevaluate my strategy.
Jackson Davis
there is somehow money to be made from predicting the new cold war. US will try to obtain goods/commodities essential to national security from outside China. so that means pharmaceuticals, rare earth minerals, etc. do I go balls deep on Indian and European pharma? And Australian and American mines? I imagine there are places that could be mined, but aren't, due to shit profit margins. But if the US shifts away from Chinese rem, then they will be mined? Fuck, how i do even start to research this?
Cooper Hernandez
That's stupid, why wouldn't you bet where you think the market is going?
Jack Cruz
Fuck i wish I wasn't a financial brainlet...
Jack Edwards
TVIX is going down tomorrow, I would sell if I could even for a small loss.
Caleb Young
Are you the user from the previous thread asking about REE?
Oliver Nelson
Would you guys say it's a good idea to go for General Electric?
I expect TVIX go up in the morning tomorrow and retrace a bit in the evening. Theoretically we'll encounter a light bounce in the S&P500 from all the high volume dumping due to delusional idiots still thinking in a V-shape recovery.
My plan is to watch the charts and when TVIX hits the upper bollinger and has an RSI spike on the 3min interval, I'll sell and wait a bit to rebuy.
There won't be a HUGE retrace of TVIX until we have a magnum green dildo on the daily.
Jordan Gonzalez
I am not. im a uni student who just got back from office hours with a prof who is an expert on chinese foreign relations. he essentially thinks we're gliding into a new borderline cold war. i want to somehow monetize his predictions
Kayden Johnson
my expectation for tomorrow is that we will get a reversal and $2780 on SPX will be defended
TWM can only make you money if we really go down to test the levels from March
I cant wait for the Futures to say one thing, then a different thing, and then a different thing, then a different thing when everyone's asleep, then a reversal while everyone is still asleep
I wish I had saved up a good chunk before starting out. I am a fucking moron for fucking myself out of money 20 bucks at a time on bad options contracts. I'm like the living embodiment of "what not to do with your life". It sucks being smart enough to realize you're an absolute retard.
>was watching fox business today >watching based Varney >he asks his guest if he thinks Jerome's comments are why the market is falling >the guy bluntly says no and that we've been ascending in a dead cat bounce with weak volume and he fully expects a retest of previous lows if not new lows
based
Joshua Mitchell
Real talk though. How the fuck is oil still crabbing
Christian Reyes
just don't sleep
this but with the girls I should have fucked in high school instead of stocks
Anime is for virgin teenage boys, and incels, change my mind.
Austin Moore
Pasta from the last thread.
The semiconductor and other high-tech industries won't get over their need for REE anytime soon, and China just happens to be sitting on some of the most abundant known deposits. I'm not sure how profitable a direct REE investment would be. You could look at the Li and Co space to get an idea, since they're used in battery technology. They're not REEs, but their operations are probably similar.
There are several refining steps involved, and the ore grade and type determines much of a site's viability and productive capacity. There can also be significant lag times in between identifying new sites, when those sites can be acquired, when excavation and refinement can begin, and when the site starts turning a profit. That means that those miners tend to be running on debt for extended periods of time. Some things to consider when investing in them directly, as opposed to investing in the companies (TSM, INTC) that add the value.
Matthew Hall
Based post for ant investors
Jordan Powell
I was up till 4:30 last night cuz I felt it coming, and just ended up sleeping through the whole trading day.
>Just buy calls and puts bro! >Just sell naked calls and puts bro! >Just bet stocks go up or down 20% a week bro! >Just buy penny stocks and hold forever bro! >Nooooooo! Don't actually buy fundamentally sound stocks!! >Nooooooo! You can't just collect options premiums! >Nooooooo! You can't use strategies that hedge for risk!
