All things STOCKS

[Velo Vol]

Should one view this as a tech stock directional indicator?

 

[Firebirdparts]

How can you even ask? Do you not realize that tech companies produce items people like?

 

[Velo Vol]

 

[Orange.]

It's a sign of trouble for risk-on stocks. Recently a lot of software fast-growers have been put in that basket because, reinvesting everthing, they show no profits. But I figure you know this. For example today: NET -6.18%, ZS -5.19%. Meanwhile OXY +9.87%. OTOH, BILL +16.65%. Loco.

 

[kiddiedoc]

Thoughts on CNWGY with the Regal bankruptcy? It's fallen to $0.19

 

[Thunder Good-Oil]

Thoughts on CNWGY with the Regal bankruptcy? It's fallen to $0.19

It’s probably worse odds than investing in lottery tickets at this point. Slight chance of making a fortune while statistically highly likely to have a big negative return.

One positive is that it is still early in the process so any good news, real or fake, could generate huge spikes and returns.

Remember, the Regal ASSET that CNWGY owns is facing reorganization in the USA and the owners of that equity are facing losing every penny of their stake to the debt owners. Equity holders almost always surrender everything to those that are long the debt who then might take pennies on the dollar so that the business is able to continue on with a new balance sheet. Then CNWGY is a separate layer and is looking at LIQUIDATION (by the UK’s version of chapter 7). Regal could continue on for a while as a going concern after reorganization. They could even thrive. Regal’s common employees could be far enough up the distribution order to continue being paid through the process. Cineworld Group seems to be drawing its last breaths.

There could be an opportunity to make something if there are secured bonds that are available to be publicly traded. But that is its own universe. I suppose a broker may know if those securities exist for retail investors to buy.

Retail investors buying ADR shares in CNWGY are highly likely to just be handing their money over to the arbitrage professionals.

Just my opinion - certainly not offering any advice on investing in their financial mess.

 

[@1RBFjr]

In the midst of the most recent Greek financial crisis, I took a flyer and bought some shares in the National Bank of Greece. I figured their government probably would not let the bank go under, but I was wrong. I knew there was a chance I could lose everything, so I did not put in more than would cause me to lose a minute of sleep. Caveat emptor.

 

[Velo Vol]

I’ve thought about taking a large position in a single name and systematically selling covered calls. But as FBP points out, I’d be limiting the upside moves. I suppose there’s an appropriate counter though to participate when that happens - perhaps buying well out of the money calls.

I watched a few videos on covered calls and am now an instant expert (in my head). Feels like a good time to try it as a big rally from here seems unlikely, economic fundamentals as they are?

 

[Thunder Good-Oil]

I watched a few videos on covered calls and am now an instant expert (in my head). Feels like a good time to try it as a big rally from here seems unlikely, economic fundamentals as they are?

Selling covered calls and selling cash backed puts is working great for me right now. But it’s just been small positions. I’m still learning. I’ve also only had a few limit orders for the options execute and I’ve closed all but one that has (NVDA 220826C202.5 - too bad I didn’t sell a couple dozen of those contracts, but I’m not going to be dumb and sell naked calls). Once we move into substantial, extended bear or bull market moves it should get much more difficult to short the puts and calls successfully. Maybe I’ll shift to buying them instead.

Yesterday I went through every stock that I own in my IRAs and created a list (of round lots - 100 shares or more) so I can start writing more covered calls. Rule number one is to only use the stocks that I kind of want to sell. It is difficult to keep track of the open options positions - at least when looking at only an iPhone screen. I’m still trading the options at Fidelity while getting the real time options quotes on the Ameritrade app. Fidelity is only giving quotes that are delayed about 15 minutes. I really dislike them for that - but I just realized that they are giving me free streaming of Bloomberg TV. Ameritrade and Schwab have free streaming of CNBC. I haven’t found free streaming of Fox Business. The CNBC stream is delayed about a minute, so it won’t work so great if day trading.

With the put selling you need to keep up with cash (or buying power if not an IRA) in the account in case the puts all strike and the shares are deposited. With the covered call selling I just need to be sure that I have the shares on hand (hence the list that I just created). I didn’t notice the broker’s app incorporating a feature to prevent me from selling too much. Maybe it’s on a funds available to trade calculation. Whenever I’d place an ordinary buy limit order for shares it would adjust the funds available. Maybe it does the same for options and it considers having the shares in the account for covered call selling. But I don’t see those shares flagged and I didn’t select anything when placing the covered call order for me to make that designation.

There’s so much to learn. I’m just scratching the surface. I wish that I had started selling options a couple decades ago. Instead I only bought a few calls. First one deteriorated all the way to zero for 100% loss. After that, I’d make a small return on a couple of long call positions and then sweat it out as the expiration date loomed. I’d typically sell to close WAY too soon. Then I bailed out of options all together for 15-20 years.

One thing that discouraged me from getting back in with options was what I considered to be a ridiculously wide bid/ask spread. But it really isn’t relevant as fast as the prices move. Also it’s kind of deceptive since each contract is so thinly traded. If the limit orders are far apart that specific contract just sits there without trade activity. The real spread at executions are minimal if anything. The commissions at Fidelity are also practically nothing.

 

[mrorange211]

I really don't know. After doing some digging this weekend, it appears over 64% of the big boys are net short. Not what you see before a big correction usually.

 

[Thunder Good-Oil]

I really don't know. After doing some digging this weekend, it appears over 64% of the big boys are net short. Not what you see before a big correction usually.

“Net” short or NOT short?

 

[@1RBFjr]

I watched a few videos on covered calls and am now an instant expert (in my head). Feels like a good time to try it as a big rally from here seems unlikely, economic fundamentals as they are?

Any chance you recall what you watched? As far as investing videos go, so many out there aren’t good or just bad wrong.

 

[Thunder Good-Oil]

Any chance you recall what you watched? As far as investing videos go, so many out there aren’t good or just bad wrong.

Search Investopedia on YouTube. Also broker websites have videos on basic concepts. Motley Fool has pretty reliable information - but they constantly try to sell their subscriptions.

 

[Thunder Good-Oil]

The long straddle for expected volatility. Pretty simple options concept.

 

[Thunder Good-Oil]

Options Basics:


Put options basics:

 

[Thunder Good-Oil]

Covered Calls:

 

[Thunder Good-Oil]

Check the ex-dividend dates if selling covered calls on high yield stocks:

 

[@1RBFjr]

Search Investopedia on YouTube. Also broker websites have videos on basic concepts. Motley Fool has pretty reliable information - but they constantly try to sell their subscriptions.

Thanks for this as well as the links to the videos, @Thunder Good-Oil !

 

[Rasputin]

Check the ex-dividend dates if selling covered calls on high yield stocks:

I don’t believe that is the way options are assigned. I think it is on a random basis.

 

[Thunder Good-Oil]

I don’t believe that is the way options are assigned. I think it is on a random basis.

Still, if you are writing a covered call option on a stock that pays 3%, 4%, 5%, etc you need to pay attention and factor in the ex-dividend date. Especially if selling a near expiration date with the strike close to the market price of the shares.

 

[Rasputin]

Still, if you are writing a covered call option on a stock that pays 3%, 4%, 5%, etc you need to pay attention and factor in the ex-dividend date. Especially if selling a near expiration date with the strike close to the market price of the shares.

You are correct. It is just that it doesn’t matter what you sold the option for. if exercse makes sense to a random owner of the option, you may lose your stock.

 

[Thunder Good-Oil]

You are correct. It is just that it doesn’t matter what you sold the option for. if exercse makes sense to a random owner of the option, you may lose your stock.

The guy in the video is correct though. Sell a covered call and it’s not going to be assigned when the stock trades above the strike. When below the strike it might not be assigned if there is a lot of time to expiration or the stock is only a few cents below the strike.

 

[Thunder Good-Oil]

Maybe the best resource. I haven’t explored it yet, but will plan to take the FREE online courses.

Home

 

[Velo Vol]

I really don't know. After doing some digging this weekend, it appears over 64% of the big boys are net short. Not what you see before a big correction usually.

What do you usually see?

People who follow technical stuff say it's still kind of bullish, but there's been negative sentiment all along . . . so rather confusing.

 

[Velo Vol]

Any chance you recall what you watched? As far as investing videos go, so many out there aren’t good or just bad wrong.

As it turns out I watched parts of three videos by that Brad Finn guy who @Thunder Good-Oil posted above. They seemed reasonably balanced, though I am a bit suspicious about people talking of a "system" that makes money every day.