We need Prog to explain this.

Burn it all down NOW!!!!

So James A Baker, who was a teenager when Joe Biden was born and supported the Trump campaign, is the grand mastermind here?

Ginormus Ag said:

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I know exactly what this means and implicates, but could someone explain it for the idiots and the dumbs reading this thread? Thanks.

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What an odd take

ETA sorry if you meant this as a joke.

Owning a put option


A buyer pays a premium on the option to sell shares at a stated price at a certain date in the future

Often times this option is viewed as insurance if the price of the underlying should decrease

The value of the put option increases as prices fall

C@LAg said:

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Schneider Electric said:

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Ginormus Ag said:

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I know exactly what this means and implicates, but could someone explain it for the idiots and the dumbs reading this thread? Thanks.

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What an odd take

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he was jokingly asking for an explanation.

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Ah. Thx for the clarification

I always thought that shorting stocks was when you would sell stocks that you didn't own with the promise to buy after the fact. Sell high and buy low. Say someone sold a stock at $100 a share then bought the shares when stock dropped to $50, you would make $50 per share. As far as "puts", you are in effect "putting " stocks in the market for transactions - stocks to be sold.

At least that is my very rudimentary understanding of this.

Ginormus Ag said:

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I know exactly what this means and implicates, but could someone explain it for the idiots and the dumbs reading this thread? Thanks.

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No.

Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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The Big Short film had the best explanations for that stuff and was a great movie.

This is a good fifteen second explanation but like you, I can't wrap my head around this stuff.

Looks like they bought the right (or option) to sell up to 12,000,000 shares of the stock for $39/share, thinking it would go down. There is a reason based on recent price action to expect it likely to move lower after the big post-debate bump. It would be interesting to see if they typically look for these kinds of trades, but it's likely just coincidence IMO.

Looks like I type really slow on my phone.

This data is useless without a strike and date. I can't find open interest anywhere near such value on any of the chains.

How an Investor Can Make Money Short Selling Stocks
quote from the article

• Suppose you think that Meta Platforms Inc. (META), formerly Facebook, is overvalued at $200 per share and that its price is due to go down. You "borrow" 10 shares of Meta from a broker and then sell the shares for the market price of $200. Let's say all goes as planned, and later, you buy back the 10 shares at $125 after the stock price has gone down and return the borrowed shares to the broker. You would net $750 ($2,000 - $1,250).

Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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My understanding is Basically you are selling something you don't have planning on buying it cheaper after the price goes down
Why this is allowed or even legal is a different question

Sq 17 said:

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Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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My understanding is Basically you are selling something you don't have planning on buying it cheaper after the price goes down
Why this is allowed or even legal is a different question

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It's a risky proposition on its own because, while there's a floor for how low the price of a stock can go, there's no ceiling. So you can easily lose your a**

Sq 17 said:

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Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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My understanding is Basically you are selling something you don't have planning on buying it cheaper after the price goes down
Why this is allowed or even legal is a different question

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Why shouldn't it be legal? They pay a loan fee to someone to borrow the shares and post collateral. The person who loaned the shares is usually free to call the loan at any time and sell the shares forcing the person short to either buy back the shares they sold to give to the lender or borrow shares from someone else.

Shorts help provide price discovery and liquidity. In a market that is falling rapidly, they can be among the few natural buyers to get stocks out of a free fall as they lock in profits.

That would be selling puts.

When you buy puts, you spend a set amount of money hoping the stock goes down so you can buy it for cheaper and sell at the strike price of the options you purchased. The puts themselves can go to $0 so you are risking 100% of your investment, but the risk is finite since you will simply choose not to exercize your option and let them expire if the underlying stock price goes up.

I'm not a finance major, nor am I a stock pro, but I've dealt with options in the commodity market for the last 15 years, mostly feeder cattle.

I buy puts and sell calls to protect my investment, not to speculate on the market.

By buying a put, you are essentially setting a floor for yourself, if doing it like I do, or you are betting the price is going down. In cattle, 1 contract is 50000# of beef, so if I buy a put @$200/cwt, my market account gets $500 for every dollar below 200. If it goes up, it costs me $500 for every dollar increase.

If you were to have inside info that a certain market is going to crash, you would spend more money on a put closer to the actual spot price and rake in the cash as it dropped. Key is you have yo get out of your position before the market corrects. This is what the guys in the big short did during the housing market crash of '08

A_Gang_Ag_06 said:

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Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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The Big Short film had the best explanations for that stuff and was a great movie.

This is a good fifteen second explanation but like you, I can't wrap my head around this stuff.

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The movie was crap and failed to point the fingers at Democrats in Congress who where warned by Bush as early as 2003 of the problem.

Tramp96 said:

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I watched Billions and I still don't understand shorting stocks.

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Shoulda watched trading places

Kansas Kid said:

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The stock is valued at $7b and had less than $3MM of revenue over the last 12 months. It is estimated to have around 120,000 active daily users.

To put it into perspective, Musk paid $44b for Twitter which had 3.4b of revenue and 220MM daily active users. So in other words, at the price Musk paid, Trump Media is worth about $40MM.

That is why many people are betting against the stock via puts or a short position. Does anyone here want to say they think Trump Media is a good stock to buy and hold at the current valuation?

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Merger just happened at the end of March...

While I agree on pretty much everything in your post, the time frame and expectations are a little exaggerated from an analyitics stand point.

I just don't see another social media platform succeeding unless it finds a niche and/or gets rolled into an existing platform.