Just reading some post, and it seems like a good time to break the ice for investors. I move a lot of options, they are nothing to fear, in fact when used properly they can reduce risk, preserve capital, leverage exposure, hedge bets...
Here are two simple rules anyone entering the options arena needs to know, just remember this, and you will be ahead of the majority of other investors who didn't learn these two principles yet:
- Stock replacement
- In the money
If you're buying calls (the right to purchase the stock at the strike price) because you're bullish, you'll want to buy only the number of contracts that is equal to the number of shares you would buy, so 1 options contract = 100 shares (excluding minis, new this year)
Pitfall number 2 is buying ats, and outs (at the money / out of the money) You'll want to buy in the money calls if you're bullish. How far in the money? That depends, but for LGF I wouldn't spend more than a couple of dollars over intrinsic value. As of this moment March 25.00 calls cost 4.90, or $490 / contract. They have 3.76 of intrinsic value, and as long as the stock can move up to 29.90 by March expiration you'll break even. If the bottom falls out, and the stock goes to 17.07 (61.8% ret) you'll be automatically stopped out at a -4.90 loss while shareholder losses will be -11.69. If the stock does well, and returns to $35 call buyers will gain $510 vs. $624 for shareholders, but you only risked $490 to net $510, shareholders had to invest $2,876 to net $624.
There are other nuances I'm ignoring, such as even if things go south you can unload your calls to some gambler that will buy your out of the money calls, so you can be stopped out at a better price than you might think at first glance. For example the current at the money options 28/29 are carrying .65 extra premium. Good luck, and have fun...
Parabolic move breaks down in this neighborhood. Took profits a little too soon at 52, got back on the bus from 53-54. Looking for that correction, bullish long term, but we need a reset short term.
No need to stare the SDR gift horse in the mouth any longer. Time for me to shift my stance to long. 40% upside potential with a nice divvy bonus of nearly 25%. Close enough to my technical goals, trying to squeezing any more downside from this just borders on ridiculous.
Hey tenbagger, er I mean, jr5423, is this the kind of "claim of success" you were refereeing to? Twtr up 30% in a week from my recommendation, currently short at 52, before I going long again, it's documented in real time over there. I do stuff like this daily try to keep up, if you can. Oh, and I'm back to long on NFLX as of this morning. None of it matters except for the fact that I'm bullish BIOL as a long term investment, and if say it is so, then it must be true as evidence of a very long, very accurate, verifiable track record ;)
P.S. Don't worry about my finances, I'm sitting on a cash surplus, some of which is earmarked for BIOL pending a reverse split.
Blah Blah Blah, same rhetoric just a different day. You just can't stand the fact that the ship simply will not go down while Freddie is at the helm. Have a nice day, and watch my investment grow for me ;)
What right moves? "New Team Members, And Piper Jaffray To Advise..." duh.
Maybe you should stick to bashing NFLX, it's done really well under your watch. $50 to $370 with you crying foul play the whole way lol
How long will your new ID last before you get banned permanently?
Doing the all the right things. The only question I have is when will they untie my hands with a 1:10 reverse split? You know it's on the table. Bashers and shorts are getting nervous, as they should be. They gambled on a worst case scenario, and it's just not going their way. OWN IT!
LGF to 25-ish. A 38.2%, and 50% retracement of two ranges line up in the mid to upper 24's, which is pretty close to the "round" number of 25, 400 dma should offer strong support around 23, MACD still looking bearish, Relative strength holding in the 30's, no signs of being over sold yet. Mid 20's offers numerous points of resistance in close proximity to each other. Reaffirming my bearish sentiment from a technical standpoint; put buyers can wait a little longer to cash in.
I have done well recently in many stocks trading both directions, and I don't mind taking a risk and be more aggressive here. By that, I mean if you want to buy and hold, you have my blessing, in fact it's a smart, and safe bet, but I think a slight correction (maybe only lasting 24 hrs) is near.
If I'm wrong, then so be it, I'll take my lumps without complaining, but if I am correct then I can take profits at 52, bet against the stock to profit from negative movement, and either retake my original position with less of an investment, or employ gains to hold a larger piece of the pie, or simply walk away with remaining gains since I'm technically playing with the houses money.
The last two days are steep, the market is pretty euphoric, I see a down day in our near future, it doesn't mean I've abandoned my long view of the 12 mo range, just that this is how stocks move, and if you can tune in to that frequency you can supplement your gains by taking a few calculated risks along the way.
Looking to test the round figure of 50, then 38.2% @ 47, and maybe 50% @ 45.5 which I'm going to nudge up and call 46. Further more a bull market performs better with shorter bursts of 2-3 days broken by intervals retracement, as opposed to long stretches of consecutive bullish days. So if you're bullish, you should want Wednesday, or Thursday to pull back, before resuming the climb.
I'm not recommending anyone else try to time what I see coming, or even count on it happening, it's just a gamble that I feel comfortable throwing some money at that I didn't work too hard to collect the first time around.
The news was AAPL bought Topsy, that was the catalyst that brought buyer like me to the table. Data licensing is going to move to a much more prominent position in TWTR's revenue stream. Now you know, so go get caught up on the reading assignment.
I think we'll see 12-13 as others have said. This is were a method is as important as setting targets. It's good to have a thesis to invest in, but also a way to hedge against what you didn't see coming. I may think we are near the bottom, and be wrong. By the way I never set out to identify a top or bottom, sometimes I do, but only as a byproduct of searching for good entry / exit points. With that said, I like these levels for an entry point, and I like using a spread to hedge against further erosion.
There is a cost associated with setting it up, but I feel the reduced gains resulting from the cost of the insurance are justified. I don't recall the exact number, but I posted on this board what my actual locked in standing looked like as price tanked, and I think it was just shy of $13 / shr while still holding shares, barely felt the effects. I ended up allowing my covered calls to exercise, it was a judgment call to capitalize on bearish conditions, turned out to be the right choice, but I could have bought the calls back and kept shares to the present moment.
There is still plenty of flexibility to slant your sentiment in any direction, and trade accordingly, but it also works as a long term strategy to reduce risk as well, just know you will have to replace any shares that might get called away. In my case, I gave up the .53 divvy, and they got called away at a time when the stock was over $11.25, so I'll gladly replace the position with a $9 share instead, now I have the choice of replacing 1:1 or 5:4, so when the next divvy rolls around I'll be holding 25% more shares, and it didn't cost me a dime, in fact I made money betting against the stock in the interim.
Is it starting to sink in yet? Not a replay of FB's IPO. Data, your data, data about your likes and dislikes is money in the bank. This time around it's less of an unknown quantity thanks in part to FB. AAPL has BILLIONS in cash to buy things like Topsy, and take aim at TWTR's data stream as one of only a handful of companies with access to it. Next up...TWTR videos to compete with Youtube. What? With AAPL aligning itself with TWTR, or at least shared interests, that makes AAPL and GOOG even more competitive with each other. Steve Jobs exacting thermonuclear war with GOOG from the other side?
Rather be lucky than good? :) Lucky would be if LGF waited for my target before announcing a dividend, or buyback. One or the other is going to be announced, and end the correction.
8.75 meets earlier assessments, and Wednesday ends wash sale considerations for investors called away. Couple that with an oversold and undervalued condition, and the time is right to start maneuvering for a long position. How each of us goes about that is personal preference, I personally would give up a few dollars in gains to be able to use someone else's money. So I will likely pick up shares and immediately enter a spread against them, possibly with a little leveraging at the same time since I'll be pretty bullish following the completion of this correction.
Team Cowbell + 10 pts, Team bashers - 10 pts
That Cowbell sure screwed up last week going from bull to bear on NFLX, and long TWTR lol
Remember my AAPL plug at $500 couple months ago when you scoffed? Yeah, it will be $600 soon. There's tons of recent trades with pinpoint accuracy, that I simply don't make public, bashers are so far out of their depth it's ridiculous. Investors need to OWN BIOL!
Went long two years ago around $14, took profits 33-36, currently bearish with puts until 27-ish, will stick a toe back in the water there.