<p>We might get to the place where people buy stocks because they like the companies that they own and how they are growing earnings and paying dividends instead of betting purely on price action.</p>
<p>I wonder if the market would be higher overall if there were more people participating.</p>
<p>^^^^^That is so ‘old school’. ;)</p>
<p>“Smart move doc…but what if you are in it before 911?”</p>
<p>There were a number of things. You could have hedged your portfolio (always) so that volatility is reduced - limiting your upside but also limiting your downside which from my standpoint is more important. You could have just held on knowing that these type of events lead to temporary market drops and recover with time. My view which is counter to gravity, is that the faster the market as a whole goes up or down, the faster it goes down or up. Also I am more in stocks sometimes than other times but I never am fully invested. I like to have some dry powder for exogenous shocks that provide a buying opportunity.</p>
<p>doct, as I told you my mom’s story. The portfolio manager took mom’s money and went to the cleaners. he basically bought10-20-30 shares of staock from across the sectors like an sp500, but when the axes fall, nothing you can do about. You think he will short some thing or sell some options to hedge? fat chance! not enough time for a 100k account.</p>
<p>Almost no movement in the night session.</p>
<p>oh - some managers are unscrupulous for sure.</p>
<p>" I was surprised by how much capital I had to put up…$220000 for something that makes $200. It was for a week…but that is not a huge return…"</p>
<p>Thst doesn’t read well…lol…</p>
<p>So…I think another way to do this is too just do a spread instead of just selling the puts outright…</p>
<p>You can buy baby puts…puts way out of the money…and it will cut the capital required…to short the puts.</p>
<p>So instead of risking 220,000 to make 200 a week…you might be able to to use 75,000 to make 180 a week…</p>
<p>The 180 a week is not guaranteed.</p>
<p>It’s the optimal outcome.:)</p>
<p>Ok…that’s it…</p>
<p>I know a lot of people don’t know what I am talking about…and that is a good thing. :)</p>
<p>Most people shouldn’t really be doing this crap…</p>
<p>I just wanted to make the numbers better. :)</p>
<p>The main risk is having to buy the stock for 220,000. But would you rather buy aapl for example at 480 next week or 560 today? This should only be done with something you really want to own.</p>
<p>Maybe…I don’t want to buy Aapl at all…</p>
<p>And like I said…it is just a return on capital proposition…</p>
<p>You didn’t really want to buy the spys at 137…you did the trade because you didn’t think it was likely the spys were going to go down there…or you thought you could roll to a lower strike price without much of a cost…if any…</p>
<p>“Volume still sliding…”</p>
<p>The pennyization of the equity markets…Really hurt human traders…and helped machine traders…</p>
<p>When bid-ask spreads were cut to a penny (or less), human traders…for the most part could no longer make money trading that spread…but machine trading …because of the volume that can be done…and because hftraders can get paid to trade…could make money trading for a penny.</p>
<p>Decimalization probably is better for investors…
One reason trading volume has shifted to hft firms is because trading is not as profitable for people…</p>
<p>I know trend followers can still make money…and swing trading exists…but human trading has declined…</p>
<p>I am not saying this is good or bad…just saying…</p>
<p>I remember ,not too long ago, paying 79.95 per trade with ML, now i either trade for next to free or 7 bucks…</p>
<p>Which firm do you use?</p>
<p>Primarily Fidelity and TD, but bounce in and out ,when others have better deals…amazing how ‘negotiable’ Fidelity is…</p>
<p>Both firms sell their orders…</p>
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<p>I feel like an investor (four-letter word) compared to you guys.</p>
<p>:)…</p>
<p>Covered some short puts…</p>
<p>I am not liking these short puts…
I am not going to sell too many of these…
A little is ok…otherwise…doesn’t fit my personality…</p>
<p>I am going to let doct do those…</p>
<p>"You didn’t really want to buy the spys at 137…you did the trade because you didn’t think it was likely the spys were going to go down there…or you thought you could roll to a lower strike price without much of a cost…if any… "</p>
<p>I want to own spy but when I saw that it was hitting 137 and likely to go lower this week because of “groundhog day” in Greece, why should I buy it at that price when I can buy it lower later. I sold the 137 weekly put for .21, bought it back for .13 and sold the 5/11 for .30 and a profit. If it goes down past the 133 this week I’ll do the same, I want it at the lowest price possible.</p>
<p>I notice that when I sell puts for peanuts…and the stock drops below my strike price…</p>
<p>I don’t really want the stock as much as I think I did. :)</p>
<p>My partner said…I was going to cover…if the puts went into the money…and I said he was full of s… But… :)</p>
<p>I can understand that but I’d rather make 0.08 than lose 3.00 on the spdr. This week I prefer to make .30 than lose 1.75 as of now. In general I prefer making peanuts than losing a lot in a market that is going down.</p>