cisgenderedAggie said:

---

You're getting all my stars now, sweetheart.

---

He's trying to sneak into the blue star top 10, currently sitting at #12

FbgTxAg said:

---

Prognightmare said:

---

I didn't even know about that. I also doubt stars on the B&I board will get me enough stars to even matter. IDGAF about stars.

---

Exactly what someone who craved stars would say

---

If I didn't know that you regularly hang out with incredibly smoking hot women, then I'd parlay, but I will choose to remain in your good graces.

Anyone know when Russell posts their inclusion list pre or post market? Curious if CLOV fixed their issue that got them removed.

cisgenderedAggie said:

---

$30,000 Millionaire said:

---

Double_Bagger said:

---

cisgenderedAggie said:

---

Question on risks.

Earlier today, based on the alerts for RIG I sold 1 Nov $5p and for each of 2x Nov $7 calls purchased, yielding a a net credit of of $0.94. This seemed like a reasonable strategy if we expect it to run. As I'm reading, this is apparently called a synthetic long position, though one might usually use the same strike for both options. What I'm reading states that this offers unlimited profit potential but also unlimited risk. I'm not following the second part.

The questions:

- if the strike is $5, and there was a credit of $0.94 per put, the maximum loss should be $3.06. That would be the case if the stock goes to zero. Am I missing something?

- this seems like a pretty reasonable and some what risk-mitigated strategy for a low strike option (ie, I don't think I'd do this with SPY). This seems especially true if I like the stock, right?

- assuming I'm not wrong on the second question, shouldn't we be doing this regularly for the MA stocks like WWR?

---

If the strike is $5, and there was a credit of $0.94 per put, the maximum loss should be $3.06. That would be the case if the stock goes to zero. Am I missing something?
Max loss would be $4.06 per contract if the stock goes to $0. Risk is limited because the stock can't go below $0.

This is an okay strategy IMO, but I'd look for input from OA, 30k, or FJ

---

I think this is a solid strategy if you want to give yourself the potential for a home run. Your risk is that RIG goes under $3.70, but even if it did, you could probably sell calls against it. This strategy is referred to as "bullish risk reversal".

Saying differently, you're going to be really annoyed substantially under $3.70 or at like $6.5. If Rig explodes, though, this could be a killer trade.

---

Thanks. I can see getting annoyed in the long term, but mostly just always looking for a reasonable strategy that I can employ regularly and also understand. It's good to know that I'm reading it right.

I also starred Progs post because it's clear that stars matter a lot to him.

---

So help me understand something here: Is the reason to sell the Puts basically to help finance buying the Calls? If we think RIG is going to go up, there's little chance of having to buy the shares and a good chance the Calls will increase in value?

If only I knew of a tailgate..


Oh wait

Welcome to the family

If you started in February and made it out even to date you did pretty damn good just beginning. Most growth stocks took massive dumps the past 3-4 months.

Also note that you'll have to have sufficient margin balance or cash to cover the sold puts. So it's not exactly free money to fund purchase of the calls. However if you are bullish on a stock but you are wrong on the timing when you buy calls, at least selling the puts can offset the loss of money from calls if the stock stays at current price or only slightly moves up. On the other side you don't have the unlimited upside like you do in calls. Just puts you on the other side of selling theta premium versus buying it.

If you have the bank and believe that SAVA's update will come through, look at the 8/20 90c and the premiums are huge. Sell the put.

frankm01 said:

---

cisgenderedAggie said:

---

$30,000 Millionaire said:

---

Double_Bagger said:

---

cisgenderedAggie said:

---

Question on risks.

Earlier today, based on the alerts for RIG I sold 1 Nov $5p and for each of 2x Nov $7 calls purchased, yielding a a net credit of of $0.94. This seemed like a reasonable strategy if we expect it to run. As I'm reading, this is apparently called a synthetic long position, though one might usually use the same strike for both options. What I'm reading states that this offers unlimited profit potential but also unlimited risk. I'm not following the second part.

The questions:

- if the strike is $5, and there was a credit of $0.94 per put, the maximum loss should be $3.06. That would be the case if the stock goes to zero. Am I missing something?

- this seems like a pretty reasonable and some what risk-mitigated strategy for a low strike option (ie, I don't think I'd do this with SPY). This seems especially true if I like the stock, right?

- assuming I'm not wrong on the second question, shouldn't we be doing this regularly for the MA stocks like WWR?

---

If the strike is $5, and there was a credit of $0.94 per put, the maximum loss should be $3.06. That would be the case if the stock goes to zero. Am I missing something?
Max loss would be $4.06 per contract if the stock goes to $0. Risk is limited because the stock can't go below $0.

This is an okay strategy IMO, but I'd look for input from OA, 30k, or FJ

---

I think this is a solid strategy if you want to give yourself the potential for a home run. Your risk is that RIG goes under $3.70, but even if it did, you could probably sell calls against it. This strategy is referred to as "bullish risk reversal".

Saying differently, you're going to be really annoyed substantially under $3.70 or at like $6.5. If Rig explodes, though, this could be a killer trade.

---

Thanks. I can see getting annoyed in the long term, but mostly just always looking for a reasonable strategy that I can employ regularly and also understand. It's good to know that I'm reading it right.

I also starred Progs post because it's clear that stars matter a lot to him.

---

So help me understand something here: Is the reason to sell the Puts basically to help finance buying the Calls? If we think RIG is going to go up, there's little chance of having to buy the shares and a good chance the Calls will increase in value?

---

Pretty much. As it stands, I have no money in this deal and my downside is buying a stock that i probably don't mind holding anyway. As long as the price stays above $4.06 by the time I either exit or get assigned in November, I have made profit, and I can sell anywhere above $3.7 to get money back out. The biggest downside is locking up cash reserve to cover the put, but if I look at the premium as de facto interest on the cash, it's a much stronger return than I could get on almost anything over a 5 month period.

What I found after hours is that this is called a synthetic long position. It is supposed to allow you to recreate the same behavior as a stock purchase, but it costs much less. In this case, I have a $2 spread under which my potential upside is muted ($5 put to $7 call). If the strikes were the same, I probably would have paid a small amount net. As it stands this way, the spread resulted in a credit, so I'm already at about $94 profit per put, so no money at committed risk but I can profit potentially as much as having actually owned the shares if it runs. If it really explodes, I'll probably just put a GTC limit buy on the puts for a penny and keep the calls until the trend reverses or 30 days to expiry.

Thanks for your explanations. Makes sense.

My luck started with my first trade with AMC at 8 and I sold later the same morning at 16 which offset most of the losses I saw from stupid buys in other trades (I bought CLOV at 16 and averaged down to 14). I'm still holding CLOV since 90% of my shares were covered during the recent run to 28... There were also other stupid buys like ZOM at 2.60 and SNDL at 1.93, but I'm still meet free on SNDL.

I've learned to be much more diligent in my buys since those days...

Thanks.....good info. Gonna look into this some more. Appreciate it.

Austin Ag06 said:

---

My luck started with my first trade with AMC at 8 and I sold later the same morning at 16 which offset most of the losses I saw from stupid buys in other trades (I bought CLOV at 16 and averaged down to 14). I'm still holding CLOV since 90% of my shares were covered during the recent run to 28... There were also other stops buys like ZOM at 2.60 and SNDL at 1.93, but I'm still meet few on SNDL.

I've learned to be much more diligent in my buys since those days...

---

Whereas last nov-feb any idiot like myself could have made money, from Feb through now as a newbie it would have been really really easy to blow up an account so good on you for surviving with some luck lol.