All things STOCKS

[Firebirdparts]

Is there a way to do puts/calls on the Dow/S&P without putting up $30,000 on the trade?

I don't know. I'm sure SPY is the most heavily traded ETF on earth and also has the largest option volume, I'd guess, so it has very nice bid/ask spreads as well as the whole 3-times-a-week closings. If you start googling ETFs that support options and track an index fund, you might have a quite a few to look through to see who's got a low share price. I'm sure there must be 100 of them.

 

[Go aeiou]

I am just so theta gang. I can't shake it. And I know why. I never did have the crystal ball delusion, and I can't make myself have it. I am very sure that I have no clue. I've demonstrated it many times.

You are ahead of most people.

 

[Thunder Good-Oil]

I don't know. I'm sure SPY is the most heavily traded ETF on earth and also has the largest option volume, I'd guess, so it has very nice bid/ask spreads as well as the whole 3-times-a-week closings. If you start googling ETFs that support options and track an index fund, you might have a quite a few to look through to see who's got a low share price. I'm sure there must be 100 of them.

SPY is $375/share. So in order to sell a cash secured PUT there needs to be $37,500 of unencumbered cash in the account for each contract sold. That 3x expiration period week is unique.

DOG is $35/share, so only $3,500 per put contract sold needs to be available in the account. But DOG is a bear themed ETF. Would need to buy puts to take the bullish position. Also there aren’t even weekly expirations / only monthly.

 

[Firebirdparts]

Yes I understand.

 

[VolAllen]

Draft Kings getting worked today

 

[Go aeiou]

Draft Kings getting worked today

Two stocks that seemed unlikely to suceed from the beginning:
Draft Kings: Nothing special about them.
Palantier: Saw the two main guys on CNBC about 2 years ago, and they seemed confused about their business, but excited about getting wealthy. I guess it worked.
Do they have a desirable product? Maybe it's just over my head.

 

[Jax_Vol]

Is anyone green in like the last year or so? Cause I’ve gotten smoked lol

smoked here

 

[Velo Vol]

I am just so theta gang. I can't shake it.

??

 

[Velo Vol]

SPY is $375/share. So in order to sell a cash secured PUT there needs to be $37,500 of unencumbered cash in the account for each contract sold.

Yes, this is the problem. That's too big of chunk of my portfolio to be putting on a single trade, even though buying the S&P at this level wouldn't be the end of the world, long term.

 

[BigOrangeMojo]

Two stocks that seemed unlikely to suceed from the beginning:
Draft Kings: Nothing special about them.
Palantier: Saw the two main guys on CNBC about 2 years ago, and they seemed confused about their business, but excited about getting wealthy. I guess it worked.
Do they have a desirable product? Maybe it's just over my head.

The worst was the sham of a company, Idex. I loved busting people on that a couple of yrs ago...

 

[Thunder Good-Oil]

Yes, this is the problem. That's too big of chunk of my portfolio to be putting on a single trade, even though buying the S&P at this level wouldn't be the end of the world, long term.

It is odd that I was able to find DOG in the under $100/share security but strike out finding an opposite (Bull) version. With single stock ETFs it would seem that there’s be a market for 1/10th versions that were option-able. Try writing a put contract on Chipotle. With CMG at $1,397 you must have an extra $139,700 in the account (or margin buying power) in order to sell 1x cash secured put contract. Doing the same with BlackRock requires $65,615/contract. CostCo: $48,631.

 

[Thunder Good-Oil]

Draft Kings getting worked today

I was worried that I owned some DKNG. Just checked and I don’t. It’s only on my under $20/share watchlist.

DKNG put options are good to write if you only have about $1,100 available cash or buying power in an account. But lately I’ve been using LABU when an option-able account only has a small cash balance. Or CHPT. Or: F, ACCO, ARKF, ARKX, CLF, GBTC, GT, JBLU, M, PARA, PLTR, RKT, SIRI, SNAP, SSP, SWBI, T, UAA, URA, WBD, WEN.

 

[Velo Vol]

 

[Thunder Good-Oil]

SCHB, ITOT, and SPTM are a few broad funds with smaller share prices. However, they are monthly in their available options.

 

[Thunder Good-Oil]

SDS: under $50, weekly options, big volume

BUT ultra shorts the S&P 500

 

[Velo Vol]

Oof.



Googling suggests that despite the above message, you can apply again, and tweaking a few answers might get you passed the algo.

 

[Firebirdparts]

I read something years ago (maybe on wallstreetbets) about applying for options, and having to answer questions like "How much experience do you have trading options" and "how much money do you have" and I discovered the correct answer to both questions is "S**tloads"

 

[Thunder Good-Oil]

When the only “option” to sell cash secured puts on some contracts is to have tens of thousands of dollars of cash on deposit or enough buying power AND the brokers deny applications to trade options by educated potential traders - perhaps they don’t want retail investors peeling off some easy trading profits from the institutions and big firms.

 

[Thunder Good-Oil]

Also, the $0.65 fee (Schwab) PER CONTRACT is regressive as ****. Trade a couple of low priced contracts and the $1.30 round trip can add up to a large percentage when the numbers are small. Since the fee is “per contract” rather than a percentage (which I would be against as yet another tax), a round trip could easily run $5 whether the total trade is $500 or $50,000. But on the other hand maybe it is reasonable if it reflects the actual cost of processing a “contract”. I don’t know if the government or the broker keeps the contract fees. Schwab claims to be commission free on listed securities.

 

[Firebirdparts]

The government?

 

[Thunder Good-Oil]

The government?

SEC. I haven’t paid attention to the purpose of the fee. I just watch it subtracted from my profit.

 

[Velo Vol]

I read something years ago (maybe on wallstreetbets) about applying for options, and having to answer questions like "How much experience do you have trading options" and "how much money do you have" and I discovered the correct answer to both questions is "S**tloads"

I don't know if someone actually checks your account balance/history, or if it's mostly a machine doing it based on the answers in the application. I'm now thinking it may be the latter, so I'll apply again.

In the video below one thing he said they do verify, indirectly, is how long you've been trading. If you're 24, and you put you've been trading for 10 years, they'll reject because you're not supposed to trade until you're 18.

I previously got approved for Tier 1 (calls and puts). I'm not sure that spreads are inherently that much more risky than those. One can lose a lot of money doing either one.

 

[Velo Vol]

Yikes

 

[Thunder Good-Oil]

Carvana has a market cap of $50 billion. They “service” 284 cities. That does NOT mean that they have a facility in 284 cities. That means that they will deliver a car to 284 cities on the back of a truck. Do the math.

The founder is a shady character. He’s a convicted felon.

I wish I had bought long term puts on them.

 

[Velo Vol]

Should anyone be surprised?