All things STOCKS

#1,352
#1,352
SpringBokVol said:
Can someone explain calls and puts to me in a way that makes sense?

I want to play around with some options.
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Investopedia provides a helpful breakdown of options trading: The Essential Options Trading Guide

Standard disclaimer is that options trading is extremely high risk, and most options contracts (70% approximately) expire worthless. Meaning that unlike shares that you can hold onto and cost average indefinitely, options are commodities that can expire where you lose 100% of your investment. There's also an extremely high premium on options at the moment, so in addition to high risk tolerance, you need some liquidity as well.

I am by no means an expert on options trading, but there are strategies that investors and traders can look at. Right now investors may want to look into writing and selling puts against assets they're hold and are long on. That's one way to limit downside risk. Happy to answer any questions the forum may have around options and how to think about trading at the moment.
 
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#1,353
#1,353
SpringBokVol said:
Can someone explain calls and puts to me in a way that makes sense?

I want to play around with some options.
Click to expand...

You either buy or sell options to buy or sell something. There are 4 positions.

Buy Puts (bearish (negative) outlook)
Buy Calls (bullish (positive) outlook)
Sell Calls (bearish outlook)
Sell Puts (bullish outlook)

Pricing is based on many variables, but strike price and expiration dates are the primary elements. Also, high volatility in the price of the underlying security increases the valuation of the associated options.

They trade as units of one hundred options (a contract). A $2 option means it's a $200 price on 100 shares.

Most expire worthless. They are derivatives. Their value is derived from another underlying security.

Value erodes as time passes.

In the money is when the strike price is below the current market price of the underlying security for CALLS. The opposite for PUTS.

Pros cut losses quickly.
 
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#1,354
#1,354
APD (Air Products) and LIN (Linde plc) sell oxygen and have pulled back with all industrials.

Hospitals will be filling up.

Anything with business models based on operating remotely is an opportunity. Netflix. TeleDoc. Intuit. Zoom. Ally Bank. Maybe Paychex and ADP. Probably Amazon, although lots of hands handle those packages. You'd think GOOG and Facebook, but they're dependent on advertising sales from a robust economy. Akami and broadband providers (AT&T) should see heavy demand. Optical components come out of China. Any domestic sources are well positioned. Perhaps Corning (GLW) will sell a lot of cable, but they've been more of a manufacturer of glass in display screens of late rather than fiber.
 
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#1,360
#1,360
BigOrangeMojo said:
The biggest Bull case for Boeing will be that when air travel and the economy get back to normal is the Max issue will be fixed and forgotten by the public...
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Yes. It won't be back for a long while. Stock could potentially go to zero, but it won't ever cease operations as long as there's a United States. It won't be surprising to see cruise lines, airlines, and hotels fail.
 
#1,361
#1,361
Thunder Good-Oil said:
Yes. It won't be back for a long while. Stock could potentially go to zero, but it won't ever cease operations as long as there's a United States. It won't be surprising to see cruise lines, airlines, and hotels fail.
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I think cruise lines will struggle to remain a going concern. I think one of the big 3 will declare BK at some point. I think companies like Marriott and Hilton will be fine from a going concern perspective since they are essentially franchise/branding plays (Full disclosure, I worked for Hilton during 9/11). I think there's more downside for them from a stock price perspective but I don't see BK. There will be plenty of franchised locations that will declare BK. I think there's been so much consolidation in the airline industry and their BS are much stronger than after 9/11 so I think most can weather a bad 2020 and bad first half of 21. If it continues, all bets are off.
 
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#1,364
#1,364
BigOrangeMojo said:
I think cruise lines will struggle to remain a going concern. I think one of the big 3 will declare BK at some point. I think companies like Marriott and Hilton will be fine from a going concern perspective since they are essentially franchise/branding plays (Full disclosure, I worked for Hilton during 9/11). I think there's more downside for them from a stock price perspective but I don't see BK. There will be plenty of franchised locations that will declare BK. I think there's been so much consolidation in the airline industry and their BS are much stronger than after 9/11 so I think most can weather a bad 2020 and bad first half of 21. If it continues, all bets are off.
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Since nobody wants to book a cruise vacation right now, they should look into leasing some ships to the government as temporary hospitals. The regular hospitals will soon be at capacity if the trend doesn't slow down real quick like.
 
#1,365
#1,365
If there's an airline that's a BK candidate, it's American. Tons of debt and not a lot of cash on hand. Deeply exposed to cuts in business and international travel.
 
#1,368
#1,368
BigOrangeMojo said:
Futures are tanking again
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Down 3.3% - futures are getting dumped hard. This is 2008 financial crisis bad, no hyperbole. Futures hit a limit at 5% down, and if we hit that again like Monday morning, that means that we'll more than likely gap down low enough to hit the circuit breaker again with the SPX down 7% due to all the overnight margin calls and selling that takes place.

This is not financial advice, but I'm getting as defensive as possible right now because I'm as bearish as I've ever been before.
 
#1,370
#1,370
GoVolsDR said:
Down 3.3% - futures are getting dumped hard. This is 2008 financial crisis bad, no hyperbole. Futures hit a limit at 5% down, and if we hit that again like Monday morning, that means that we'll more than likely gap down low enough to hit the circuit breaker again with the SPX down 7% due to all the overnight margin calls and selling that takes place.

This is not financial advice, but I'm getting as defensive as possible right now because I'm as bearish as I've ever been before.
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I've got a decent chunk of change that I want to put in market but I havent yet. I even got out of CVX and COP positions 2 days after I got into them. I see no rational basis in market at all now. Recession proof stocks got pounded today.
 
#1,372
#1,372
The only “safe” plays right now are CV stocks. Take a look at TTOO. I strongly ($20k) believe this is the next one to pop. They specialize in sepsis, which is one of the main killers of this Cov19. Awarded a $69mil grant from the Government back in September, never had to reverse split, in the middle of a $65mil ATM and the price is still holding well. 42mil was the volume today and the ATM should be completed by weeks end. Ran from .52 to 3.20 back in September. Hiring for 23 positions right now on LinkedIn.

We’re all gambling with money in the market right now, but the right plays can make you rich.
 
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#1,375
#1,375
Go aeiou said:
I thought it is just Europeans flying to the US.
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You're correct, edited for posterity. I suck at phone posting.

Fun coupon VOL said:
USO is going to be a buy in three weeks.
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Oil is so oversold, and it's certainly due a run up from a technical perspective. But the macro is so bearish I see crude selling off violently along with the rest of the market.

VolAllen said:
The only “safe” plays right now are CV stocks. Take a look at TTOO. I strongly ($20k) believe this is the next one to pop. They specialize in sepsis, which is one of the main killers of this Cov19. Awarded a $69mil grant from the Government back in September, never had to reverse split, in the middle of a $65mil ATM and the price is still holding well. 42mil was the volume today and the ATM should be completed by weeks end. Ran from .52 to 3.20 back in September. Hiring for 23 positions right now on LinkedIn.

We’re all gambling with money in the market right now, but the right plays can make you rich.
Click to expand...

GILD, CODX, INO, MRNA, NVAX, and REGN are all pure corona plays I'm monitoring and waiting entry. I was in and out of REGN in late 2019 after the completion of a bullish Gartley pattern. I think that at this point, you're right, we're all speculating to one degree or another. Ttechnical analysis is basically invalidated. Conventional TA would have told you to buy the intra-day dip yesterday on SPY as you were bouncing off a key Fibonacci node while making a higher low with bullish divergence. But all just to see futures markets dump and gap you down lower, completely invalidating a resounding bull case with lots of coinciding variables, the kind of trade that normally hits. This is not a normal market though. The market is so irrational at the moment, it's super risky whether you want to go long or short as a trader. But the right plays will literally print money. Even SPY puts from yesterday and today are going to be deep in the money. Hopefully I can sell some puts before the circuit breaker hits, buy some dirt cheap calls for the inevitable scrub rally up, to sell off once again
 
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