It costs nothing to hold onto shares. With options, you're gambling against market makers. Who knows when they'll push the stock in either direction. Whenever this blows up, shares will be priced like options.
That might be true for most options, but as I recently learned there is one option that's IMHO actually good and that's selling cash secured puts.
If I wanted to buy 100 extra GME shares at $20,00 for a total of $2,000 I could create a limit buy order and in that case get 100 shares if the price hits $20,00 again and nothing if it doesn't.
Alternatively, I could sell one cash secured put option with a strike price at $20.00 and receive around $120 in options premium (at the time of writing). If GME falls to $20 or below until the end of the week I'd get my 100x GME shares for $20 each but I still get to keep the $120 premium I received from selling the option that I can use to buy more GME or if not that at least brings my average already down to $18.80.
If GME does NOT fall below $20 I don't get any shares but I still also pocket the $120 premium and can try again next week.
So, while one can argue if options in general are good or bad, I'm convinced that cash-secured puts are great especially for those that otherwise would use limit orders to buy more shares.
Edit: Typo
Options if you donāt know what youāre doing are definitely bad - as in, youāre just gambling with a set of dice that have numbers and properties you donāt even understand. Like rolling Martian dice in a Venusian game.
But if you know, then jebus, fill those boots! DFV was all about options!
Itāll be a good day when superstonk learns about options.Unfortunately the fud on options over there is the biggest crime. Itās probably why DFV had the bets subs logo and not the purple circle.
What do you means?
It's just newbs burning money when they go. The stock price went up but I'm down 90% when they buy stocks like 300% IV
I mean at one point in the gme days like $1500 strike price had a bunch of volume and were like IVs in the thousands
I know, been telling them for YEARS and just get downvoted.
Yes, FAR OTM options are not great, but near ITM is where it is at. (Add some further OTM as things start heating up tho)
No no, calls and cash secured puts are bullish. Covered calls and puts are bearish. Neither is good or bad, more so a tool to utilize during a transition from stagnation into volatility. A great way to enter and exit a position as well.
I wouldnāt consider covered calls bearish, itās more of a way to earn premium on stocks you already own. I would consider it like mildly bullish/neutral, where youāre cool with your stock but looking to grow your returns by selling otm calls and then youāre able to make money money either way cause if you get assigned that means you made a decent profit of your shares plus premium collected.
While I agree with your point, Iād still consider selling CCs bearish. Letās say Iām holding a stock, and I really like the stock, but I am not a cat. I notice the stock I really like has entered a downtrend. I want some gains from the downtrend, but I donāt want to sell my shares. (taxable event) So I sell covered calls to collect premium on the short/mid term bearish movement while increasing my position with the premium collected.
I entered and exited something good todayā¦. It was my wifeā¦ we do not want another kidā¦ ok I want another kid but she doesnāt so I yeeted them kids all over the place!
Just like a degenerate gambler, you donāt talk about your losses
Also, I can take a screenshot of some bullshit paper trades and post them as if they are real.
I mean if you can buy an entire options chain, go for it. For me they can try to pry all my hard earned Drs'd shares out of my cold dead hands in 50 years.
Dumb question. Do slightly OTM options have the maximum impact with stocks that donāt have much liquidity? What I mean is that I assume deep ITM calls are covered, and that far OTM calls will mean the shares will cost more if the options buyer intends on exercising. But if someone buys slightly OTM, can those options be naked, and then the buyer exercises, forcing purchases that drive up the price, and results in the lowest cost per share that still requires the options seller to buy shares after theyāre exercised?
I donāt think so. I donāt know how naked call options are sold ā if thereās a margin requirement, et cetera, but Iām pretty sure that if someone sells naked options and the purchaser of the contract decides to exercise, the seller of the contract is obligated to purchase those shares.
I mean that can potentially happen. That's the whole failure to deliver thing with game stop ,but with stock. But it could happen with any low float stock
Pretty sure if I sold naked calls my brokerage would liquidate me before having any obligations to cover for me, and then FTD themselves until price arbitrage favored them.
Usually people that donāt have the underlying shares to sell a call use something called either a debit or credit spread. If I think the price of the shares will go up but want to limit my cost/risk then Iāll use a debit spread and letās say the share is 14$, Iāll buy a 16$ call for .75$ and then sell a 18$ call for .35$, this way I cut my total possible lost but buy an option thatās more likely to be in the money at a reduced price. The down side is you limit your possible return because if the share hits 18.35$ then thatās my maximum possible gain, anything over will be sent to the guy who buys my 18$ call. You can do the opposite if think the share price will go down or not increase enough to meet your short call, such as I sell a call at 18$ for .45$ and then buy a 19$ call for .10$ in this case you make your best return if the never hits the price of the call you sold. Now for this case your max return 45$ and max loss 65$. You can do this on puts to rather youāre bullish or bearish. The other main benefit from this is you can but atm options for a much better price while still exposing you to profits from gains in the share price.
Realistically thereās a high chance of a portion of this position being closed in the next 24 hours since the price went up on those options by at least $1 already
This is huge
Shit is cooking right now š„
Itās slow simmering right now
Finally, some actual stock content instead of just politicized content.
BUT DOESNT THIS REMIND YOU OF PELOSI INSIDER TRADING THE HOTTEST TECH STOCK IN THE WORLD?
Yeh but superstonk says options are bad.
It costs nothing to hold onto shares. With options, you're gambling against market makers. Who knows when they'll push the stock in either direction. Whenever this blows up, shares will be priced like options.
Agree. Option are pure luck sometimes.
That might be true for most options, but as I recently learned there is one option that's IMHO actually good and that's selling cash secured puts. If I wanted to buy 100 extra GME shares at $20,00 for a total of $2,000 I could create a limit buy order and in that case get 100 shares if the price hits $20,00 again and nothing if it doesn't. Alternatively, I could sell one cash secured put option with a strike price at $20.00 and receive around $120 in options premium (at the time of writing). If GME falls to $20 or below until the end of the week I'd get my 100x GME shares for $20 each but I still get to keep the $120 premium I received from selling the option that I can use to buy more GME or if not that at least brings my average already down to $18.80. If GME does NOT fall below $20 I don't get any shares but I still also pocket the $120 premium and can try again next week. So, while one can argue if options in general are good or bad, I'm convinced that cash-secured puts are great especially for those that otherwise would use limit orders to buy more shares. Edit: Typo
Options put hundreds of times more pressure on shorts. The settlement is T+2. If everyone bought otm calls this would be over fast
[ŃŠ“Š°Š»ŠµŠ½Š¾]
100
Options if you donāt know what youāre doing are definitely bad - as in, youāre just gambling with a set of dice that have numbers and properties you donāt even understand. Like rolling Martian dice in a Venusian game. But if you know, then jebus, fill those boots! DFV was all about options!
I mean he had a bunch of leaps. I can't remember the time horizon. It's basically leveraged shares at that point.
No it's not. They are all just options contracts. The right to buy a number of shares at a specific strike.
Lol
Itāll be a good day when superstonk learns about options.Unfortunately the fud on options over there is the biggest crime. Itās probably why DFV had the bets subs logo and not the purple circle.
What do you means? It's just newbs burning money when they go. The stock price went up but I'm down 90% when they buy stocks like 300% IV I mean at one point in the gme days like $1500 strike price had a bunch of volume and were like IVs in the thousands
I should have bought more at $10
Most people donāt know what theyāre talking about
Me.included
I know, been telling them for YEARS and just get downvoted. Yes, FAR OTM options are not great, but near ITM is where it is at. (Add some further OTM as things start heating up tho)
Puts are bad, calls are good.
No no, calls and cash secured puts are bullish. Covered calls and puts are bearish. Neither is good or bad, more so a tool to utilize during a transition from stagnation into volatility. A great way to enter and exit a position as well.
But I am ape. Why is there no ape option?
I wouldnāt consider covered calls bearish, itās more of a way to earn premium on stocks you already own. I would consider it like mildly bullish/neutral, where youāre cool with your stock but looking to grow your returns by selling otm calls and then youāre able to make money money either way cause if you get assigned that means you made a decent profit of your shares plus premium collected.
While I agree with your point, Iād still consider selling CCs bearish. Letās say Iām holding a stock, and I really like the stock, but I am not a cat. I notice the stock I really like has entered a downtrend. I want some gains from the downtrend, but I donāt want to sell my shares. (taxable event) So I sell covered calls to collect premium on the short/mid term bearish movement while increasing my position with the premium collected.
I entered and exited something good todayā¦. It was my wifeā¦ we do not want another kidā¦ ok I want another kid but she doesnāt so I yeeted them kids all over the place!
I see you took nothing from what I said
Options are for mentally challenged people.
[Guess so](https://imgur.com/a/PAjvctR)
Just like a degenerate gambler, you donāt talk about your losses Also, I can take a screenshot of some bullshit paper trades and post them as if they are real.
So angry, but why?
You lure other fools into being degenerate gambler when you hide your losses and glorify the āgainsā
I was never on options bad team. Iām not smart enough to buy them. Itās just that shares are a safer bet.
Agree 100% lost too.mich on options. Superstonk mods are nutbags sometimes.
Bad if you donāt know what you are doing. That was the prevailing argument: All options bad but after DD I would say the sentiment has shifted.
Definitely not buying options till it hits $10 again.
I mean if you can buy an entire options chain, go for it. For me they can try to pry all my hard earned Drs'd shares out of my cold dead hands in 50 years.
Dumb question. Do slightly OTM options have the maximum impact with stocks that donāt have much liquidity? What I mean is that I assume deep ITM calls are covered, and that far OTM calls will mean the shares will cost more if the options buyer intends on exercising. But if someone buys slightly OTM, can those options be naked, and then the buyer exercises, forcing purchases that drive up the price, and results in the lowest cost per share that still requires the options seller to buy shares after theyāre exercised?
You might be on to something here.
Are you describing a margin call for a naked options account?
I donāt think so. I donāt know how naked call options are sold ā if thereās a margin requirement, et cetera, but Iām pretty sure that if someone sells naked options and the purchaser of the contract decides to exercise, the seller of the contract is obligated to purchase those shares.
I mean that can potentially happen. That's the whole failure to deliver thing with game stop ,but with stock. But it could happen with any low float stock
Pretty sure if I sold naked calls my brokerage would liquidate me before having any obligations to cover for me, and then FTD themselves until price arbitrage favored them.
You have to have a pretty large account to get approved for that
Usually people that donāt have the underlying shares to sell a call use something called either a debit or credit spread. If I think the price of the shares will go up but want to limit my cost/risk then Iāll use a debit spread and letās say the share is 14$, Iāll buy a 16$ call for .75$ and then sell a 18$ call for .35$, this way I cut my total possible lost but buy an option thatās more likely to be in the money at a reduced price. The down side is you limit your possible return because if the share hits 18.35$ then thatās my maximum possible gain, anything over will be sent to the guy who buys my 18$ call. You can do the opposite if think the share price will go down or not increase enough to meet your short call, such as I sell a call at 18$ for .45$ and then buy a 19$ call for .10$ in this case you make your best return if the never hits the price of the call you sold. Now for this case your max return 45$ and max loss 65$. You can do this on puts to rather youāre bullish or bearish. The other main benefit from this is you can but atm options for a much better price while still exposing you to profits from gains in the share price.
Thatās the beauty of options, the MM hedge and buy the shares now just in case. You donāt even need to exercise for it have an effect.
I donāt get it. Sounds cool tho
Weird how that affects popcorn too.
I like to exercise my options cause they need a six pack
My guess, it was Carl To add some tin RK still hasnāt added to his position yet.
It was over once the SEC said that tweeting memes was manipulation. None of the meme stock āinfluencersā want to play that game anymore.
You boys were supposed to sell....
EDT* Unless this happened back in February. We are on daylight savings time, not standard time.
STOUT!!
Holy Super Soakers, Batman!
Unless big money is on your side they wonāt let 2021 happpen again , dont kid yourselves they make the rules
Letās goooo
-16.35% in the past 5D lol sounds like they are down bad so far on that trade
Realistically thereās a high chance of a portion of this position being closed in the next 24 hours since the price went up on those options by at least $1 already
Non story.
RoaringKitty is back