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Pioneer Energy Services Corp. Message Board

  • arrs20 arrs20 Oct 11, 2013 12:32 PM Flag

    Some one just bought huge amount of calls

     

    Look at today s volume on the Dec and March $5 and $7.5 strikes. 3000s each. Some one has info.

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    • I tried a short explanation. I could not say all. Some may bash me, if I missed some thing. I could answer most questions about this strategy and the ups and downs to it.
      Once I had calls on Chrysler. I was able to control more shares at a fraction of the price.
      If Chrysler would have gone down or stayed under the strike price I would loose all my investment when they expire.
      That has happened to me too.
      In this case Chrysler got bought out by Mercedes many years back and I made out great with control of Thousands of shares. Had I bought the stock instead of the calls. I would have had much less shares.
      I was a happy guy when I heard the news. The guy who sold the calls missed out that time and I got all the gains.
      My money was at risk more than his though. Calls and puts go to zero it the time goes bye and the stock does not go your way.
      I been learning this since 1973 with my first 200s of Champion home builders. lol I doubled my money and been in ever since at a young age.
      Do I know what I am doing. No! I do not. I got slaughtered in 2000,20007, etc.
      I did great on Black Monday Oct 1987. Look it up. 25% drop in one day. I sold all the day prior by luck and bought all back that MONDAY sold it all again the next Friday for huge gains.
      Later in those other years I gave it all back. lol
      Still here trying,but no greed and play it safer. THAT TRUELY WORKS BETTER.
      Pigs get slaughtered. GLTU
      I WILL TRY TO ANSWER ANY

    • arrs help me out-I don't understand puts and calls v well. What dose this mean to me as someone who is long? Thanks!

      Sentiment: Strong Buy

      • 2 Replies to zcon56
      • I tried a short explanation. I could not say all. Some may bash me, if I missed some thing. I could answer most questions about this strategy and the ups and downs to it.
        Once I had calls on Chrysler. I was able to control more shares at a fraction of the price.
        If Chrysler would have gone down or stayed under the strike price I would loose all my investment when they expire.
        That has happened to me too.
        In this case Chrysler got bought out by Mercedes many years back and I made out great with control of Thousands of shares. Had I bought the stock instead of the calls. I would have had much less shares.
        I was a happy guy when I heard the news. The guy who sold the calls missed out that time and I got all the gains.
        My money was at risk more than his though. Calls and puts go to zero it the time goes bye and the stock does not go your way.
        I been learning this since 1973 with my first 200s of Champion home builders. lol I doubled my money and been in ever since at a young age.
        Do I know what I am doing. No! I do not. I got slaughtered in 2000,20007, etc.
        I did great on Black Monday Oct 1987. Look it up. 25% drop in one day. I sold all the day prior by luck and bought all back that MONDAY sold it all again the next Friday for huge gains.
        Later in those other years I gave it all back. lol
        Still here trying,but no greed and play it safer. THAT TRUELY WORKS BETTER.
        Pigs get slaughtered. GLTU
        I WILL TRY TO ANSWER ANY

      • I could call you if it was possible.
        Calls are the option to buy a stock at a given price in the future. Time is valuable.
        Some one paid up to $145 Friday to buy 120 calls, equal 12,000 shares of stock in DEC, and March for $7.50 per share. So in effect they are paying $7.50 plus the premium of up to $1.45 = $8.95 in the future. Rather than buy the stock they can control more shares for a fraction of the money. There are upsides and downsides to this.
        They are putting their money up front thinking the stock will be higher than that at the time.
        As time goes bye the calls value eventually goes to zero unless the stock is higher than the strike price of $7.50
        So the person who sold the calls already has that in their bank, and they could sell calls again etc. If the stock is higher the person who bought the calls gets the stock for the price of $7.50 and could sell it or keep it.
        I could say so much more.

        I sold calls three times on 4000s of PES I am holding for about $0.80 each time. This time I will loose the stock. Oh well. I made rent on the stock while I held it and a small gain too. I will not look back. Made a decent return while the market was shaky . I will probably watch them take my shares in March for $7.50 even if they are much higher.
        That is the down side. I still made a gain of $0.80 three times.
        You do the math.
        I did cover the calls twice when the stock came down over the last two months for $0.40 each time. This last time the stock is up and will probably not cover the calls unless time goes by and the stock just stays around here.
        I made $0.40 twice and $0.80 once plus the gain from buying the shares at $6.85 to probably loosing the shares at $7.50. I can't complain.
        It ties your hands though so It is a strategy ,but like others ups and downs.
        I would love to explain better talking some how.
        Its like owning properties and getting rent while you hold. GLTU BE CAREFUL
        Some people like this some do not.

 
PES
13.88+0.09(+0.65%)Apr 17 4:01 PMEDT

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