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Nzoner's Game Room>Investing megathread extravaganza
DaFace 11:23 AM 06-27-2016
A place to talk about investing stuff.
[Reply]
Rain Man 01:50 PM 01-13-2017
Here's a strange question. I have an older relative who doesn't trust banks or any financial institution. She got some stock 30 years ago from her employer, and it's actual stock certificates, not electronic at all. The company still exists, so I presume it's worth something. I've got the job of talking her into putting it into a brokerage instead of keeping it in a drawer. Anyone ever convert actual certificates? I presume maybe I take it to a brokerage in person?
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Amnorix 02:04 PM 01-13-2017
Originally Posted by Rain Man:
Here's a strange question. I have an older relative who doesn't trust banks or any financial institution. She got some stock 30 years ago from her employer, and it's actual stock certificates, not electronic at all. The company still exists, so I presume it's worth something. I've got the job of talking her into putting it into a brokerage instead of keeping it in a drawer. Anyone ever convert actual certificates? I presume maybe I take it to a brokerage in person?

Is this a public company or a private company?
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Rain Man 02:07 PM 01-13-2017
Originally Posted by Amnorix:
Is this a public company or a private company?
Public.
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Amnorix 02:12 PM 01-13-2017
Originally Posted by Rain Man:
Public.

Then yes, just bring it to a broker. I imagine they take physical possession of the stock and then put it into your relative's name. Convert from physical, direct ownership to street name ownership.

That's my best guess, but they can do whatever needs doing. Or you could try to call the company's transfer agent. Computershare or whoever. Those services track who owns stock for each public company, and they may be able to help. I'd just call your broker, though, as a first step.

Given stock splits, etc. over the years she may own more or fewer shares than indicated on the stock certificate(s) itself, however. Will be interesting for you to find out.

Has she been getting proxies etc. in the mail all these years?
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scho63 02:15 PM 01-13-2017
Originally Posted by RubberSponge:
Get out. Take a gain when you see it. Don't try to be too greedy.
Of course I didn't and instead of making $2,090 on a $1,403 investment for a 148.96% DAILY gain, I hung on as sellers came in and LOST $1,187.

I do this all the time! :-)

oh well, it's only money :-)
[Reply]
Rain Man 02:15 PM 01-13-2017
Originally Posted by Amnorix:
Then yes, just bring it to a broker. I imagine they take physical possession of the stock and then put it into your relative's name. Convert from physical, direct ownership to street name ownership.

That's my best guess, but they can do whatever needs doing. Or you could try to call the company's transfer agent. Computershare or whoever. Those services track who owns stock for each public company, and they may be able to help. I'd just call your broker, though, as a first step.

Given stock splits, etc. over the years she may own more or fewer shares than indicated on the stock certificate(s) itself, however. Will be interesting for you to find out.

Has she been getting proxies etc. in the mail all these years?
I have no idea if she's been getting proxies or anything. She just showed me the certificates last year (and was having trouble finding some of them), which made cringe.

Thanks for the help! I don't know if I'll talk her into entering the late 20th century or not, but figure I should try. However, my nightmare is that I'll take it to some broker who's never even seen these things, and they'll get lost in the system.
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Amnorix 02:34 PM 01-13-2017
Originally Posted by Rain Man:
I have no idea if she's been getting proxies or anything. She just showed me the certificates last year (and was having trouble finding some of them), which made cringe.

Thanks for the help! I don't know if I'll talk her into entering the late 20th century or not, but figure I should try. However, my nightmare is that I'll take it to some broker who's never even seen these things, and they'll get lost in the system.

So presumably she held the certificates directly in her own name, not in street name through a broker or otherwise, which should mean that she is listed by the company as a direct stockholder. That would mean she would be getting proxies, etc., assuming she kept the company up to date as to any change of address etc.

You can email whoever, attaching photos of them, to see if they can handle them. You should definitely get a receipt from whoever you give them to, and also make sure you understand how they intend to handle them (convert the ownership into street name or what).

Presumably she could also just cash them out if that is her preference.
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Amnorix 02:35 PM 01-13-2017
Actually, do you mind saying which company it is?
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Discuss Thrower 03:17 PM 01-13-2017
Call investor relations of said company.
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lewdog 05:03 PM 01-13-2017
Ok Scho and RubberSpong, I'll admit it, I am lost on what you're doing. I do not know relatively anything about stock trading like you're doing. I think I don't understand all the terms and am confused by some of the numbers being thrown out. If one of you was willing, I'd take a detailed explanation and scenario, with numbers included, so I can see how this works. Would be nice to understand this whole concept even if it's an option that I will not use.

Some of my dumb questions are things such as, why did Scho put out multiple calls all at .60? What the fuck does .60 even mean? Can he have set this to sell once his money doubled or does he have to check the price of the stock all day and sell once it's where he wants? What's your best chance at making even just some money instead of being greedy and risking it all?

I love all your smart bastards. Thanks for the lesson in this. Hopefully it helps other idiots like myself out.
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Rain Man 05:08 PM 01-13-2017
Originally Posted by Amnorix:
Actually, do you mind saying which company it is?
Actually, I don't recall. It's a regional bank that she worked at, and it got bought and sold several times when she worked there. I saw the certificates briefly, but it's one of those generic bank names that no one remembers. But she said that she monitors the stock price, so presumably she's got certificates for the version of the company that's currently listed.
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Halfcan 08:02 PM 01-13-2017
Originally Posted by Halfcan:
Has anyone on here used the Nova X Report?

It is being pushed hard on financials websites.

Also-who is into the Medical Pot stocks. I have 4500 shares of one "company" that did not do squat. Some other stocks soared 125,000%. Curious where you think the next play is with so many states changing pot laws.
:-)
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lewdog 08:45 AM 01-21-2017
I still love all of you.

I'll never stop.


xoxo
lewdog
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scho63 01:18 PM 01-21-2017
Originally Posted by lewdog:
Ok Scho and RubberSpong, I'll admit it, I am lost on what you're doing. I do not know relatively anything about stock trading like you're doing.

Some of my dumb questions are things such as, why did Scho put out multiple calls all at .60? What the **** does .60 even mean? Can he have set this to sell once his money doubled or does he have to check the price of the stock all day and sell once it's where he wants? What's your best chance at making even just some money instead of being greedy and risking it all?
I'll try to cover the very basics of OPTIONS trading.

http://www.investopedia.com/university/options/

An option is a CONTRACT that gives you the right to BUY (a CALL Option) or SELL (a PUT option) 100 shares of stock for a specific target price by a specific target date.
1 contract = 100 shares

The CBOE, known as the Chicago Board of Options, creates contracts for stocks that trade on both the NYSE and NASDAQ. They create MORE options and more strike prices and dates for highly traded stocks with lots of liquidity and much less for lightly traded and low cap stocks. There are no options for pink sheet or illiquid stocks.

Apple (APPL) has a TON of options and strikes and dates whereas a company like Nuance Communications (NUAN) has just a few options and dates.

So let's make a scenario:

You like Google stock but it is too expensive to buy 500 shares. So you believe that Google is going a lot higher in the next 6 months. So you decide you want to buy some options on Google to control shares.

You would then pick a price (known as the STRIKE price) and time frame (known as the EXPIRATION DATE) to decide which option to buy.

In this case you would want a CALL because you think it is going higher. If you felt Google was going to go down a lot, you would buy a PUT instead.

As of today, Google closed at $805.02
You may look at a near term option or a longer term option. The shorter the expiration, the higher the risk and lower the premium. The further out you go the greater the premium. Also, the higher the price the higher the option premium because the stock makes greater daily price moves.

Here is a list of Google options
https://finance.yahoo.com/quote/GOOG/options?p=GOOG
On the left of the page under the word CALLS, you will see a box with dates. Those are the EXPIRATION dates for options and you can change the dates to look further out. The prices all in the FIRST column are the STRIKE price. Starting at the lowest and moving up. You then have a BID and ASK just like stock.

The difference is that when we speak of .70 per contract, it means $70 to control 100 shares. If the price was $3.25, it would be $325 to control 100 shares.

Getting back to Google, if you wanted to buy a $900 STRIKE contract that expires on June 16, 2017 you would pay a price of $8.20 a contract, which equals $820. You would be nearly $100 OUT of the money because Google would need to go over $900 by expiration PLUS the $8.20 of premium you paid for a total of $108.20 move higher for Google.

So (5) contracts to control 500 shares would cost ($820 x 5) + commissions or around $4,150.

Lower price stocks and shorter expirations have much, much less premium EXCEPT when earnings are going to be released and then both the CALLS and PUTS get extra premium built in by the market.

Try reading the first link about option investing to see if you grasp the concept. There are another 50 things to learn about options including NAKED calls or PUTS, COVERED CALL writing against stock you own, and then all kinds of crazy spreads and hedges.

It is all about leverage and risk. You can't lose more than you invest just buying options BUT you can lose a fortune if you write naked options. You would not be allowed to do that at the brokerage firm with your skill level.

Hope that gives you a little start to understand. :-)
[Reply]
scho63 02:35 PM 01-21-2017
One little addendum to my long post: you can SELL your option at any time before the expiration date. You do not have to hold it. If it goes up a lot in just a short time, you can get out.
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