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The Gonzo Lounge>Investing megathread extravaganza
DaFace 11:23 AM 06-27-2016
A place to talk about investing stuff.
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Nightfyre 11:59 PM 12-18-2017
Maximum loss of writing a put is 100 times the strike price, not unlimited. As it says in your link.
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Discuss Thrower 12:04 AM 12-19-2017
Originally Posted by Nightfyre:
Maximum loss of writing a put is 100 times the strike price, not unlimited. As it says in your link.
I wasn't paying attention and deleted my comment:

Yes, you are right. I flipped the loss potential of puts with calls.
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Hog's Gone Fishin 07:46 AM 12-19-2017
10 Stocks to benefit from Tax Reform from JP Morgan

https://www.investopedia.com/news/jp...m_medium=email
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scho63 07:47 AM 12-19-2017
Originally Posted by lewdog:
Ok bud, I have covered calls down.

Now on to puts.

How did you buy a stock at $19ish and have it currently trading in the $17's but "made" money on it losing value? How do you short a stock you currently own and where does the money you make come from?

What do you mean when you say "I averaged down and the call premiums had no good value?"

Thanks for the help! I owe you a beer!
I began buying the stock at $19.94 and bought more down to $19.01 with a cost basis of $19.54.

I also after the last purchase of the stock bought 10 out of the money puts with a $18.00 strike for June 2018 cost of $1.22 each for a total of $1,246 w commission.

The stock has gone down since I purchased losing money in the short term and the puts have gone up slightly cutting my total loss on GE. I would need to sell the puts to recoup some of the losses in the stock. Right now all profits and losses are on paper.

The puts are independent of the stock.

Next time we meet I'll give you an in depth lesson BEFORE we drink....:-)
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scho63 08:01 AM 12-19-2017
Originally Posted by Nightfyre:
Maximum loss of writing a put is 100 times the strike price, not unlimited. As it says in your link.
That's a confusing way to explain it so I'll expand your answer.

If you "write" a single PUT, it means you are giving someone the right to PUT the stock to you at a specified price before a specific time. These are called NAKED PUTS.

So if someone wrote a single put contract, which equals 100 shares of the underlying stock, for let's say $1.72 for the put contract on US Steel with a strike price of $30 and the expiration of April 20, 2018 you would collect $172 minus a small commission.

So now if the stock plummets and goes down to $25, someone who owns the put option you sold can sell the stock to you at $30 and you must pay $3,000 for a stock now only worth $2,500. You have an immediate loss of $500 - your put money of $172.

The most you could lose would be if US Steel went to $0 and you got forced to pay $3,000 for stock that is now zero and you would be out the $3,000 - $172 premium you collected when you wrote the option.

Remember one thing, the higher the stock price when writing a naked put the greater the dollar loss if it goes against you.

Some hedge funds and traders who want to buy a stock at a cheaper price if it is too high now, write a large amount of naked puts as a way to own a lot of stock on a decline while collecting the premium. If it doesn't go down, they still make money on the premium they collected. They will usually buy the puts underneath the ones they wrote so if the stock drops too much, they have some protection when there is a huge drop. This is called a STRADDLE
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Hog's Gone Fishin 09:11 AM 12-20-2017
US Steel Raised to Buy From Neutral by Longbow Research



I actually bought moar at 32. The tax plan passing should give this a boost

Sitting at 34.46 right now


These Steel/ Metals/Mining stocks are doing well since the middle of November. opportunity here ??

NUE 2.43% Dividend

STLD 1.5% dividend

TX 3.21% Dividend

GGB 0.69% Dividend

SMSMY 2.48% Dividend

AKS 0Dividend
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Hog's Gone Fishin 10:25 AM 12-20-2017
MU Micron Technology has a target price of $57-$85 .Currently at $45.

Good chance of 50% gain over next 12 months.

Good fundamentals with the company but they don't pay a dividend.
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wutamess 02:36 PM 12-20-2017
Originally Posted by Hog's Gone Fishin:
MU Micron Technology has a target price of $57-$85 .Currently at $45.

Good chance of 50% gain over next 12 months.

Good fundamentals with the company but they don't pay a dividend.
You getting in?
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scho63 03:12 PM 12-20-2017
Originally Posted by Hog's Gone Fishin:
MU Micron Technology has a target price of $57-$85 .Currently at $45.

Good chance of 50% gain over next 12 months.

Good fundamentals with the company but they don't pay a dividend.
I still ache for you every time I see the price of Nvidia :-)
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Hog's Gone Fishin 03:19 PM 12-20-2017
Originally Posted by wutamess:
You getting in?
I sent you PM but yeah I think tomorrow I'll see. They interviewed the CEO today on CNBC. I think its a solid company headed in the right direction. Good chart for the last year and they have great Fundamentals. They're on top of AI and IOT which is getting huge.
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Hog's Gone Fishin 03:24 PM 12-20-2017
Originally Posted by scho63:
I still ache for you every time I see the price of Nvidia :-)

Me too. I almost bought NETE yesterday. Glad I didn't because it only went up 272% today. Was up 344% at one point. :-)
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ChiliConCarnage 01:22 PM 12-21-2017
Originally Posted by Hog's Gone Fishin:
Me too. I almost bought NETE yesterday. Glad I didn't because it only went up 272% today. Was up 344% at one point. :-)
I bought into NXTD in the premarket yesterday for 2.8 got out at in two chunks at $7.7 and 6. I don't normally touch pennies but when I saw LFIN hold steady after that CNBC interview w/ the CEO, I figured there was just too much momentum. People are crazy..

That Long Island Iced Tea company that renamed to Long Blockchain and shot up 600% lol!
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MahiMike 01:34 PM 12-21-2017
For some reason I'm thinking we're at the top for stocks. Good time to put in stop losses.
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Rain Man 01:38 PM 12-21-2017
Originally Posted by MahiMike:
For some reason I'm thinking we're at the top for stocks. Good time to put in stop losses.
It seems like the tax plan should push stock prices up, though much of that may have already happened on speculation.

I've been pondering pulling a big chunk out to buy some real estate, and will be looking at a property in the next week or so. I worry that I'm going to miss a tax bill runup if I do, but I also feel like the stock market will at some point cool off. It's been, what, a seven-year run?
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Amnorix 01:44 PM 12-21-2017
Originally Posted by Rain Man:
It seems like the tax plan should push stock prices up, though much of that may have already happened on speculation.

I've been pondering pulling a big chunk out to buy some real estate, and will be looking at a property in the next week or so. I worry that I'm going to miss a tax bill runup if I do, but I also feel like the stock market will at some point cool off. It's been, what, a seven-year run?

Is now the time to mention that the tax plan will negatively affect housing prices, most likely, especially in higher tax states, due to the cap on mortgage deduction and SALT, including real property taxes?

May not affect you depending on your property location and/or what type of property this is. If the property is for renting, then you should be safe. Not like 1031 like-kind exchanges are being negatively affected or anything. But if it was a buy, fix-it-up and flip situation, that market might cool off at the higher end of the price range.
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