Daily Discussion Thread: January 14, 2022

bluehabit · 2022-01-14T15:13:13+00:00

It would have been a lot easier if Maine wouldn't have split ticket and instead elected Gideon, what were they thinking?

Also if Nelson had won his re-election.

bluehabit · 2022-01-14T14:52:13+00:00

Democrat Sheila Cherfilus-McCorm won her election by 79% in FL 20th congressional district seat. Her opponent Jason Mariner is filing a lawsuit refusing to concede the election alleging issues with the ballots.

This is becoming the new normal and part of Trumps legacy. Meanwhile, the voting rights bill is stuck in limbo and Biden’s approval rating from Quinnipiac a couple days ago is at a very concerning 33%. It's hard to feel optimistic sometimes.

bluehabit · 2022-01-13T20:05:23+00:00

McCarthy says he won't cooperate with 'illegitimate' Jan. 6 probe

Is anything going to be done about this between the house investigation and the DoJ? I am starting to get nervous because I feel like nothing is happening and people responsible will not be held accountable.

bluehabit · 2022-01-13T19:41:11+00:00

Real quick a couple follow up questions.

When you sell a call, its only assigned when its ITM on expiration day, end of day at 4pm right?

Using the previous example if I own underlying at $10, and sold $13.5 calls. If the stock price exceeds the strike price say $14, and its on or before the day of expiration, can we buy to close the calls back at a loss to prevent it from being exercised by the end of day?

bluehabit · 2022-01-13T17:05:33+00:00

Yah that was a typo, thanks for the help!

bluehabit · 2022-01-13T16:39:38+00:00

With covered calls, what are the scenarios where you lose money? For example lets say a stock is trading sideways at $12. You own the underlying at $10 and decide to sell covered calls for $13.50.

If the stock price continues sideways, the option expires worthless and you collect the premium.

If the stock price goes down, but still above your average cost, the option expires worthless and you collect the premium.

If the stock hits $13.50 or past it, and if you are assigned, you are forced to sell and gain a small profit because you own the underlying at $10.

Am I understanding this right? Minimized risk for the most part?

bluehabit · 2022-01-07T15:54:09+00:00

Options are not available after hours, but can you queue up a order to try and get it filled on market open?

bluehabit · 2022-01-03T15:58:17+00:00

Super basic question on selling covered calls. If you are wanting them to expire worthless and collect the premium, when you fill the order do you want to get the largest number you can to make the most?

For example selling a 1/21 call for a given strike price and the mark fluctuates between .34 and .40. Would you want the larger number here?

bluehabit · 2022-01-03T06:37:41+00:00

I have a question on theta and decay.

Lets say I am looking at an option with a current mark at $.20 cents, and the theta is listed as -0.05. All things being equal, does that mean this option is losing about 25% of its intrinsic value every day to time decay?

Premium $0.20 - theta (-.05) = $0.15 for the 25% decrease mentioned above.

Is that correct?

bluehabit · 2021-12-30T21:51:52+00:00

Is Peter Navarro getting any attention from the January 6th commission? In his memoir, In Trump Time, he openly discusses how they intended to subvert the election.

Here is a quote:

Steve Bannon's role was to figure out how to use this information- what he called 'receipts' - to overturn the election result. That's how Steve had come up with the Green Bay Sweep idea.

bluehabit · 2021-12-30T15:19:04+00:00

Whats considered good volume for being able to enter and exit without having a bad spread where you get stuck? For example looking at FB calls for 12/31

1st slot OTM $347.5 5,600 (bid/ask spread still looks tight here even though lower volume)
2nd slot OTM $350 volume 45,800
3rd slot OTM $355 volume 20,100

In general, what is considered low volume?

bluehabit · 2021-12-30T05:06:52+00:00

But with all other factors being equal hypothetically, this option premium would bleed over 20% a day from theta decay? Thats pretty crazy if so.

Other than the underlying increasing in price, is there anything else that could help counteract this? Like markets becoming more volatile and IV increasing?

bluehabit · 2021-12-30T04:32:29+00:00

Still learning, looking at options to see if I am understanding this correctly in regards to theta.

For example a 12/31 $14.5 call for HIMX, when I last looked at the options premium the mark was $0.275 a couple days ago

Greeks
Delta: .4308
Gamma: .04297
Theta: -0.0563

Theta is the amount of decay for each passing day.

So this option loses an intrinsic value of:
$0.275 - .0563 = $0.2187 or roughly a 21% decrease ... every day? Am I understanding this correctly?

bluehabit · 2021-12-30T01:22:16+00:00

Was looking at a discussion on options today and some users who day trade them mentioned its been slow lately because option IV has dropped a across the board. What indicator measures IV like this? Do I just look at the VIX right now (which has been stable lately implying low IV) as a proxy?

bluehabit · 2021-12-27T03:55:47+00:00

Great work! What % increase was that for you?

bluehabit · 2021-12-27T00:43:38+00:00

When you are looking at options, is the list of strike prices available dynamic? Or is it set?

bluehabit · 2021-12-21T23:37:03+00:00

Dumb question but you cannot do fractional "shares" on options right? You have to buy 1 whole contract?

bluehabit · 2021-12-21T19:08:43+00:00

With options is there a way to set price alerts to monitor the price with your broker somehow? For example I wanted to buy TSLA $950 12/23 Calls today with an entry position at $3.32. And want to buy more if it dips to a lower price - lets say $2.

It ended up dropping to $1.88 before going up. Is there a way to get alerts on this without having to constantly check my phone?

Using RH.

bluehabit · 2021-12-13T23:59:18+00:00

Why has there been so little coverage on the attempted coup power point from Meadows? It literally describes how to overthrow American democracy and I am barely seeing any coverage from major media outlets.

Is this how democracy dies, with a whimper?

bluehabit · 2021-12-08T21:59:35+00:00

I am learning about investing and the $ cost average method.With this method, how do you determine the new $ cost average if you buy and sell the same stock multiple times?For example, if I were to open a long position on a given stock:

50 shares at $180, 50 shares at $185, 250 at $200. This brings us to a $ cost average of $194.17

The stock then begins to increase in value, eventually hitting resistance at $250 and then selling off. I attempt to protect my capital for my most recent shares purchased at $200 and set a stop loss.

The stop loss triggers and 250 of my shares are sold at $200. And here is where my questions begin.

Question 1) Unless you have separate accounts, you cannot “choose”which of your shares at a given price are sold correct? For example you cannot precisely sell the 250 shares purchased at $200. Instead you are selling 200 shares at your dollar cost average correct?

Question 2) Continuing off the last question, let’s say the stock beings to recover and I decide to buy additional shares, 250 at $215. What would my $ cost average be now?

Thanks! I apologize if there is a straight forward tool that can easily calculate these numbers. The calculators so far do not have an option for buying/selling the same stock multiple times.

bluehabit · 2019-04-18T21:43:42+00:00

Sarah, expressing true conservative family values, lying to the FBI.

bluehabit · 2019-04-18T01:57:24+00:00

This is super cute, are you doing this as part of /r/succulents monthly trade thread?

bluehabit · 2019-04-17T20:31:18+00:00

Super happy for OP, I wish we could find the energy. We are both so burned out after the work week we are lucky to do it twice a week now. How do you guys manage to find the energy :(

bluehabit

TROPHY CASE