You accurately detected this scam, so happy this is going in your direction today.
Remember, options are for suckers, and this is not going to go straight down. Maybe pay attention to the support levels and unload your short-term puts if you can. (50 DMA is around $55 ?)
If you insist on holding this thing, the only gap we see is the huge gap between your ears. :)
But good luck, nonetheless.
Why cover at $58? This will be $20 again within the next few years.
I understand you are going to realize huge losses if you are not smart enough to sell today.
Needless to say, the comparison between ADBE and NFLX is just stupid on multiple levels. For one thing, NFLX is not trying to extort subscription fees from it's customers by threating to keep their own files. Secondly, the NFLX market is not a specialized niche group of customers like ADBE's, and these customers are going to be lost forever if they become alienated.
Good question, puts on this stock are really expensive. I think you definitely want to wait until after the split so that the options are rescaled correctly.
Of course, if you intend to hold the stock through the split, it would not be crazy to sell calls now.
Good point, most of the tech bubble included many companies that were pure speculative disasters waiting to happen, and have since long disappeared.
MA is certainly not that type of stock, but right now US company profit margins are artifically high, and it's hard to see why MA should be selling with a PE of 35X, 11X sales and 17X it's book value.
In essence, it is priced for perfection + 50%. If perfection happens, it's worth $40 after the split, but $80 is plain ridiculous unless company margins stay perpetually high (they never have according to history).
Also remember that between December 1999 and January 2000 was just about at the peak of the greatest stock market bubble in possible receorded history, and of all the tech stocks that created the bubble, QCOM was the most celebrated and bloated supernova of them all.
We are now in possibly the 2nd largest stock market bubble in receorded history, so who knows where MA will end up $800-$900-$1000, doesn;t really matter.
What is almost assured is that after the split, MA will be $20 or lower at some point if this market crashes back down to practical valuations.
Ummm, that really is not a big short position. Insiders can dump that amount of shares in about 10 minutes.