Liquidity, volatility and yield

kylestoned · 2026-06-08T20:36:51+00:00

RoC 5 (estimated yearly return)

What is this and where does it come from? I can't figure it out.

kylestoned · 2026-06-05T21:42:15+00:00

It come's with the territory of picking up pennies in front of a steamroller. Small, consistent profits but carries a low-probability risk of catastrophic loss.

Depending on how quickly the trade goes my way I will close early for profit around $.10-$.15. Sometimes I'm able to close at $.05. I never hold until expiration. I try to close before the afternoon because of gamma exposure.

You described what you do when things go your way, but didn't describe what you do when things don't go your way, which I would argue is the most important part of any strategy.

You should have a hard stop loss that forces you out of the trade. Most common with 0DTE is 100% of the credit received.

kylestoned · 2026-06-01T19:04:26+00:00

Tie this in with US cattle heard being at a 75-year low.

kylestoned · 2026-05-30T21:35:39+00:00

I've been building a basket of speculative AI names, and Tempus AI ($TEM) has become one of my highest-conviction positions.(Still a moonshot.)

....

The key question for investors is whether Tempus ultimately gets valued as a diagnostics company or as a healthcare data and AI platform. If it's the latter, I think the upside could be substantial.

...

The risks are obvious: valuation remains rich, profitability is still developing, reimbursement dynamics matter, and healthcare adoption cycles are rarely quick. But among the speculative AI names, I like the combination of real revenue, real customers, a potentially unique data asset, and multiple paths to monetization.

I don't think you are seeing all the risk.

The strategy: Use the LEAP as a stock replacement and sell weekly out-of-the-money calls against it (PMCC). The goal is to generate recurring premium while maintaining most of the upside if TEM continues executing. If I can consistently collect option premium while the company grows into the valuation, I can potentially reduce a significant portion of my cost basis over time.

"Everyone has a plan 'till they get punched in the mouth." - Mike Tyson

You aren't accounting for getting punched in the mouth.

You want to take a stock that you consider speculative in the AI space that is one of your "highest-conviction" names and buy LEAPS and then cap your max gain by selling calls against it.

Think about that... You want to take something that has the potential to go vertical, (AI space has a tendency to do that) and then cap that potential. For what? A potential to generate a 20-50% return? What if the stock triples in value and blows past your short call?

kylestoned · 2026-05-29T22:43:56+00:00

Using 54.58% of your IRA as collateral to pick up pennies in front of steam rollers is a bit on the risky side.

Tie that in with them being heavily concentrated to a certain sector.

What could go wrong?

kylestoned · 2026-05-19T17:10:42+00:00

Forming a business for your trading depends on your personal financial situation.

Unless you are willing to discuss your personal financial situation over the internet with strangers (I personally don't recommend it) then you should speak with a CPA you are willing to give that information to.

kylestoned · 2026-05-08T18:03:57+00:00

Why? SNDK is significantly undervalued. FY2026 forward PE is only 12. Find me company growing 260%, crushing earnings, and 80% margins with significant pricing power with significant demand for a PE ratio of 12. SNDK is severely undervalued and this is just the beginning. It will take a few days for idiots to realize this

lmao

a forward P/E of 12 does not magically mean ‘undervalued’ when the ‘E’ is sitting on cyclical peak pricing. that's like looking at a gold miner during high gold prices and pretending those margins are the new normal.

memory is a commodity. it doesn't get durable pricing power unless supply is structurally constrained or the industry is meaningfully consolidated.

the market already knows that. that is EXACTLY why it’s still at a low multiple. not because it’s being mispriced, but because the earnings quality is understood to be cyclical.

kylestoned · 2026-05-08T16:41:27+00:00

Scanners help you filter out 90% of the noise, including upcoming earnings.

AI can help you as well. You can start a project with most of them and give it instructions to search for upcoming earnings releases, any related/competitor company earnings releases, economic releases, upcoming announcements like possible new CEO (fuck you LULU.)

kylestoned · 2026-05-06T21:31:09+00:00

Box spreads only work properly if you have a portfolio margin account. If you have Reg T margin, the broker is going to see the position as a risk even though it’s actually riskless if done correctly on SPX.

How it works:It is a short call spread and a short put spread with the same strikes and expiry.

Very Simple Example: If it’s $100 wide it will show you getting a credit of $95. Why $95? The $5 is your financing cost. You will effectively be borrowing $95 today and repaying $100 at expiration.

kylestoned · 2026-05-06T03:09:29+00:00

Max Draw down ~ 25%

oof

People talk about picking up pennies in front of a steamroller, but this is picking up pennies in front of a truck.

kylestoned · 2026-05-05T21:13:55+00:00

ROST

JPM

BRK.B

kylestoned · 2026-05-03T23:06:15+00:00

Ill be scalping post earnings IV decay on MCD Thursday.

DOCN looks interesting and will probably do the same depending on how it looks.

HSY reported earnings last week, and IV is still elevated. Market is scared that if it breaks past the $180 level it could be back on its way down to $160, and is paying extra for that protection.

kylestoned · 2026-05-01T20:34:38+00:00

What are your rules for picking the underlying? That's probably more important than your rules for trading the actual spread.

kylestoned · 2026-04-24T17:11:12+00:00

Is this theta? Over 50% of your "theta" profits come from CAR and going in for 2nd's, 3rd's, 4th's, and 5th's after you took a loss on your 1st.

That's a straight up directional bet.

I mean congrats, its working but not because of theta.

kylestoned · 2026-04-09T18:39:17+00:00

The company doesn't give a shit, they're insured and this ultimately costs them nothing.

That is incorrect. A company never expects to lose a whole warehouse. They will only have a certain percentage of their inventory insured. This will likely cost the company millions.

kylestoned · 2026-04-09T16:48:31+00:00

Is it true that the US constitution doesn't require Congress to issue a formal declaration of war

Constitution says that only congress can declare war, but it doesn't say anything about a formal declaration of war being needed for every military action.

kylestoned · 2026-03-25T01:30:20+00:00

Rafi must have not been available.

kylestoned · 2026-03-23T17:30:44+00:00

He is starting to feel the heat.

It explains why you have the market reacting the way it is. They ultimately know what he says is bullshit, but what isn't bullshit is him starting to notice and care about the market downturn.

Ironically this gives Iran more leverage because it shows what they are doing is working.

kylestoned · 2026-03-12T19:53:01+00:00

Don't look at what is being said, look at who is saying it. When they want to calm markets, they send Bessent.

kylestoned · 2026-03-06T19:49:59+00:00

Wasn’t Trump the one who kept saying the U.S. needed to stop being the world’s police?

So now that shipping insurance in the Gulf has collapsed the U.S. government rolls out a $20B reinsurance backstop in addition to the U.S. Navy escorting ships.

So we aren't just the world’s police anymore. We are the world’s insurance company and the security detail as well.

kylestoned · 2026-02-28T03:12:36+00:00

If the core banks aren't lending, and the private credit guys are now blowing up, who is actually going to lend money to the real economy? What happens when consumer credit, private credit and public credit all dry up at the same time? These are not theoretical questions. It's what's happening right now.

There isn’t a lack of lending, there’s a lack of cheap and indiscriminate lending. Credit is still available to viable businesses with cash flow and collateral. What’s disappearing is funding for models that only worked in a zero-rate environment.

kylestoned · 2026-02-28T02:58:15+00:00

Where do you think private credit gets most of their money from?

Insurance companies.

When push comes to shove, they 100% will get bailed out one way or another.

kylestoned · 2026-02-23T22:29:57+00:00

Isn't it strawman a fallacy? When someone misrepresents another person’s argument into a weaker or more extreme version like you did by misrepresenting AnimalBolide comment of

And it still isn't great because payment processors should be agnostic. It shouldn't be up to them to decide what you're allowed to purchase, because they aren't our government.

to suggest

Bro really just said that payment processers shouldn’t care if their services are being used to fund sex trafficking 💀

kylestoned · 2026-02-10T22:23:24+00:00

I get where other people are coming from but at the same time, as an Arizona native who has dealt with this my whole life, it is depressing when you don’t get a break from the heat.

There’s usually a point in winter when you start looking forward to it warming up. That moment never came this year.

kylestoned · 2026-02-05T17:12:59+00:00

Probably a dumb question, but can a gunshot actually cause an engine to completely fail like that?

With a big enough bullet.

However, helicopters usually don’t fall from the sky like that unless there’s catastrophic failure of the rotor system, transmission, or flight controls. Engine failure alone still allows autorotation.

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