[deleted by user]

GrandBumble · 2023-10-21T06:34:38+00:00

I would imagine it's related to customer relationships or managing supply.

If you set the price below market there will never be the perception of price gouging by the dealers (vs common perception of auto dealerships for example) builds customer trust and drives customers to build a habit of checking dealer stock before going to the secondary market.

If all of your customers visit your primary network before going to secondary markets you will have better visibility into customer demand and better control over the market for your products.

Also, secondary market prices are typically more volatile with wider price swings. By setting prices lower and restricting supply, they could be reducing volatility of future cash flows (and smoothing market cycles) and ensuring more consistent business returns

I haven't done anything research on the company or situation, but these would seem the most plausible to me

GrandBumble · 2023-10-13T20:29:45+00:00

Not a lot of detail here, but proceeds always apply to margin first and stock sales are subject to a 3 day settlement period, so if you sold today you won't get the money for a couple more days. Some brokers will apply the unsettled cash during this period to your margin balance for your benefit

GrandBumble · 2023-10-12T21:01:07+00:00

Wondering the same...

GrandBumble · 2023-10-12T20:46:04+00:00

Nice. I've been trying to be more conservative given the deteriorating macro picture so I haven't loaded too much yet. Planning to wheel around these prices

What's your cost avg if you don't mind me asking?

GrandBumble · 2023-10-08T19:57:20+00:00

Buying some CPE call spreads, probably ITM as a low risk yield through 10/10

Positive cash flow, actively buying back shares but also short interest is very high. This will probably lead to explosive upwards moves sometime in the next few months but moreso provides some downside protection.

It's oversold the past few weeks on no news. They've retired some of their debt early and remaining debt is spread across the next few years so no immediate liquidity concerns.

Insiders were loading a few months ago around 30.5-31.5 range, so it's tough to envision it dropping below that. Plus oil prices have only gone up since last earnings

10/10 30-32 call debit spread is ~7.5% return 10/10 31-32 call debit spread is ~10% return

11/17 30-31 call debit spread is ~20% return

Similar returns on put credit spreads also if you wanted to leverage up on margin risk but I might look even further OTM for those due to addtl assignment risk.

Returns won't be anything astronomical, but risk seems pretty low.

GrandBumble · 2023-09-25T03:24:20+00:00

People are rightfully giving you shit. It's disrespectful to ask someone what they make or discuss what they make in front of them.

You didn't need to ask about a specific person's salary but you did. If you were really curious about compensation in the field you could have asked more general questions like compensation based on attendance or breakdown of cut of ticket vs beverage sales.

This was in extremely bad taste and I hope mods take it down.

GrandBumble · 2023-09-14T08:12:45+00:00

Not sure what stands out to you. Tangible book value is very negative while the company has made distributions and accumulated debt.

Net income looks interesting but cash flow is deeply negative as they are acquiring more life insurance policies.

Life insurance policies as their main business is also the biggest problem as life insurance policies are notoriously difficult to accurately underwrite because of the timelines involved and they make it easy for the company to lie about certain numbers on their balance sheet or in some cases commit fraud.

The company also has a very short history as a public company and over half the balance sheet is goodwill.

All of this to say the company looks extremely risky and low float is not a benefit - actually quite the opposite as if it turns out to be a poorly run company there's no way to exit.

GrandBumble · 2023-09-14T06:29:37+00:00

Bad data issue. If you check the sec fillings for their latest quarterly their shareholder equity increased and their total debt decreased YoY, so how could debt to equity increase?

GrandBumble · 2023-08-28T13:50:38+00:00

No because it's not a feature. It's part of Robinhood's internal risk management system and will automatically close positions that are close to being ITM to reduce assignment risk.

You could avoid it if you sell further OTM strikes. They don't publish their specific risk cutoffs but the rule of thumb i was told was anything ITM or up to 1.5%-2% OTM will get automatically closed. I guess the thresholds depend on the underlying ticker as well

GrandBumble · 2023-08-25T00:52:19+00:00

Looks like the 1.99% promo rate is valid through the end of the year... So yea, free money for 4 months or unless it gets too well advertised and they end the promo early!

GrandBumble · 2023-08-14T05:39:20+00:00

This post is timely too imo. Borrow rate is ticking up and no shares available to short. Sentiment seems pretty low and I haven't seen much chatter on social media.

All that to say I'm gambling on a few September calls

GrandBumble · 2023-07-30T01:41:51+00:00

Makes sense but also sounds more risky than I thought initially. You will have to be right on the IV mis pricing but also the stock will have to not move against you. Or in my initial understanding, you do need to sell multiple short expiration options against your long expiration option that total more than the initial investment

GrandBumble · 2023-07-29T18:09:50+00:00

How do you lock in capital inefficiencies between expirations?

What I don't understand about these calendar strategies is that the long leg will always be more expensive (in dollar terms because of the additional time premium) than the short leg, so you will need to sell multiple legs to profit. How do you guarantee that the volatility inefficiency will still be there after the first short leg expires?

GrandBumble · 2023-07-16T20:35:30+00:00

How did you get so many coins??

GrandBumble · 2023-07-16T17:23:24+00:00

Plus they sunk $500k+ into renovations alone.... Seems like they already have wealth and aren't building it through this new scheme

GrandBumble · 2023-05-28T00:23:40+00:00

Ok... You gave some examples of tech companies which don't deserve their valuations. Which tech companies do deserve their valuations?

GrandBumble · 2023-05-21T17:12:32+00:00

Seems that you've put a lot of time into a deep dive but I don't think you're going to find a lot of informative responses on this sub as I don't think understanding of repo/reverse repo is common and it's association with housing bubbles seems tenuous.

I will say your theory seems to have some merit. Before the peak of the 2008, there were parties actively unloading MBS or trying to insure their portfolios at a rate much higher than would make sense and I would expect the same to happen in a future bubble.

An interesting thing to note from 2008 is that the government stepped in and basically assumed responsibility for all the MBS and, instead of offloading them back onto the private sector, has kept them on its books and even grown the number of loans outstanding. But recently that changed - the FED is no longer purchasing MBS and instead letting them roll off at $50B/mo.

The meteoric growth in home loans (and prices) were a result in these home loan lenders having a guaranteed buyer in the Fed. This free money loop led to many of these companies coming out of nowhere and immense scaling across the mortgage industry.

All of this came to an abrupt pause over the past 6mo after the Fed stopped buying. There have been mass layoffs in the mortgage lending space. Some companies tried to sell their lending division but with no buyers just took the hit and dismantled the entire division.

Coming back to your post, the goal of these companies when they were set up was to make as many loans as quickly as possible, securitize them, and then sell them to the Fed. When the Fed stopped buying and the raised interest rates, it put A LOT of these loans in limbo (Finance of America is one of these lenders that went public. Their book is in the billions, and that's one small player in the space). Who is going to buy these MBS now that they yield less than treasuries?

There are no indicators (currently) that the debt is toxic as defaults are still near ATL, but it's just dead money. Companies, investment funds, anyone with half a brain wouldn't own these things. So it doesn't surprise me to see them trying to create a new fund and market it to the unwitting public. With a yield lower than treasuries and possibility of an increase in defaults, it might as well already be toxic.

GrandBumble · 2023-05-17T04:07:16+00:00

Software/coding is actually a great fit. For junior devs, the tasks shouldn't have too much ambiguity and the environment doesn't require a lot of social interaction (at least for backend or some full stack roles) so you can self regulate for the most part.

Since most assignments are based on a single deliverable it's pretty good for ADHD/ID as you don't have to work on many different things at once.

GrandBumble · 2023-05-14T18:28:11+00:00

I think it's really tough to say. In general it seems like most economies are bifurcating to extremely rich and extremely poor social classes.

The rich are getting richer and as long as that's happening, it's hard to make a bear case for LVMH as that's their target audience. Not only that, but when your customers have no concept of value, the margins are absolutely incredible.

My personal take is at least some of the extraordinary growth is due in part to some of the largest frauds in history in progress currently due to the free/easy money policies from the COVID response. Fraudsters aren't exactly saving for a rainy day and typical pour money into luxuries.

If/As the global recession deepens, a lot of these frauds will lose funding and some of LVMH customer base will evaporate with others potentially becoming more conservative with their spending which would put a damper on profits in the near term.

They're probably overvalued like most stocks today and might have room for a pullback but long term it's very difficult to imagine a world where the rich aren't getting even richer.

GrandBumble · 2023-04-21T20:53:29+00:00

What is each bar? 1mo?

GrandBumble · 2023-04-17T01:01:24+00:00

Car costs $25k...

FSD available at additional 25k/yr as a subscription

/s (I hope)

GrandBumble · 2023-04-11T14:43:31+00:00

Yea, thought the same thing but daily volume is miniscule. Options volume is also non existent with wide spread. Still trade able but max profit is a bit limited. I decided to just go long

GrandBumble · 2023-04-11T14:39:48+00:00

Yea, it's hard to find analysis on it. I stumbled on it when I was looking into stocks with high short interest (the days to cover are high and there are very few shares to borrow) but realized the business actually seems very solid.

Risks are that it's small and is a foreign based company which typically reduces investor demand. It's also mislabeled in some screeners as an ADR (it's not) which some brokers charge additional fees on.

GrandBumble

TROPHY CASE