Thanks for the thought provoking suggestion, but after several minutes of research and careful reflection, I've decided to pass on the Humboldt Fog, and will, instead, stick with the Vermont White.
OMG, hjc, you really are fixated on that CEO. Does a day every go by that you don't ponder the mysteries of Ginni? What is it about her that fascinates you so much? Her blue eyes? Her blond hair? Her smile? The fact that your idol is mesmerized by her?
Now for the cloud. I've given up trying to understand the cloud, along with Wi-Fi, bluetooth, and stop start technology (I hope I never have to buy another new car, the auxiliary battery in my son's new car died about 18 months after purchase.). Those newfangled geegaws are strictly for young whippersnappers.
And BTW, it's Ginni, not Ginny: Virginia Marie "Ginni" Rometty.
In the particular case cited in the article below, the accusation proved FALSE. But I do find it hard believe that this anything other than a short term trade. Do you believe that the buyer of the put intends to force the seller to pay him $120 per share for stock he already owns on or before expiry? Do you see that as a credible bet for the buyer?
Search: « Put Paid - Snopes »
(Options are wagers that the price of a 100-share block of a particular stock will rise or fall by a certain date. "Puts" are "shorts" — bets the stock price will fall. "Calls" are bets the price will rise. Thus, one who has reason to believe a particular company is about to suffer a terrible reversal of fortune would purchase "puts" against that entity's stock.)
Sell the 150 call, buy the 130 put, sell the 120 put - OMG what a convoluted trade!
Thanks for the exposition, but I'll pass.
You've indicated in the past that you have some academic interest in things financial. As a peace offering, here are two free papers (PDFs) that I've been reading and rereading.
Published this week on GMO's website:
« The Stock Market as Monetary Policy Junkie - GMO »
My take is that GMO believes that the greatest pumptard of the last 30 years has been the Fed.
--- and ---
« Credit Suisse The Base Rate Book – Sales Growth »
Again, my take is that, generally speaking, very large companies (like IBM) have little to no real sales growth. Over the last 20 years, the median (half the companies were better, half were worse) real growth rate (absolute sales, not per share) for companies with sales of $50B or more has been 0.6%. Hence the need for buybacks to goose the PER SHARE sales/earnings/dividends/price.
If nothing else read that paper's introduction. There's a good laugh in there at Elon's expensive.
Yeah, I know, It's hard running a good con with a smart heckler in the crowd. I learned that during my high school days. I worked (in entertainment) the Ohio State Fair three consecutive summers. I was never a heckler, but with too much time, and too little money, I did spend a lot of time on the Midway observing the nonsense. You know, this place isn't all that different. Every once in a while I still hear that voice: "It walks ..., it talks ..., it's almost human ...,". To this day, I still don't know what "IT" was. I never did pony up the change to find out.
« Last year at 150ish I posted that brkb had reached full and fair value, at 1.5 xs BV, it was a good sale or call sale. buffett has an obligation to make an effort to get brkb back toward. »
At 1.5X BV, BRK-B was trading at a 25% PREMIUM to what WEB has REPEATEDLY said he would pay, 1.2X BV.
WEB is under NO obligation to bail ANYONE out of their mistakes.
Live & Learn.
So, hjc, what's your spin on that (from the buyer's point of view).
Is the buyer a bear, betting the price of the stock will fall to 120% BV?
I'm guesstimating that if the price of the stock dropped that low, the price of the put would rise to almost $8.
Nomura's Bob Janjuah:
"In January I said that the S&P500 would fall from 2000/2050 to the 1500s as my target over 2016. I reaffirm this view."
So, in spite of the advice (buys modestly above 120% will do well, buys approaching 200% will not) Buffett gave on page 34 of the 2014 Annual Report,you're still going to advocate a price to book value ratio of 188%. Just another Pumptard with a learning disability (either you can't read, or you're incapable of comprehending what you do read).
« Warren Buffett CNBC Transcript, Feb 29, 2016 »
OK, hjc, you're right, go to page: 20, at time: 06:37:09:00.
The quote I'm referring to appears on page: 21, at time: 06:38:04:00.
If you want to follow one of Jim's option plays, read msg # 219190 on the other board.
Briefly, on the 18Sep2015 he bought an $80 20Jan2017 BRK-B Call, he paid $52.10. The closing price for the stock on that day was $129.10. That's 490 days to expiry. What do you think, will he make any money on that trade?
Beach, I'm pretty much neutral as far a IBM goes, neither a fan nor a detractor. I will jump in and offer some support when hjc gets excessively hostile towards it, but that's pretty much the limit of my interest. I don't like share repurchases, but I have slowly come to realize that it has now become a way of life for some companies.
« I read it so what's your point ? »
Asking Bill what he thinks of one of HIS competitors is a lot like as "The Donald" what he thinks of HIS competitors (Ted and Marco).
Note that in the quote that you provided, he prefaced his remarks with: "I’m biased."
Seriously, hjc, what did you expect him to say?
So it looks like you made about 3.4% on that trade, assuming you closed the contract today by buying an offsetting put at $4.75.
Check my arithmetic (on a per share basis, ignoring transaction costs).
Sell a Put, give up $120.00 in collateral to receive a Put premium of $8.60 = -$120.00 + $8.60 = -$111.40.
Buy an offsetting Put, pay $4.75 to release the collateral from the first trade = - $4.75 + $120.00 = +$115.25
$115.25 / $111.40 - 1 = 0.034 = 3.4%
Is that how you see it?
Sorry, I can't confirm what he said or didn't say this morning. I didn't listen to the CNBC broadcast for a number of reasons: I'm deaf without my electronics powered up (cochlear implant), I don't enjoy listening to anything even when the transmitter is turned on, and from what I could see, at least early in the broadcast, it wasn't closed captioned (no text).
From what I've read on the IBM board (under the topic: Dividend increase), IBM did another "Investor Briefing" last week. Their slide show is on the sec web site site, look for the Form 8-K dated February 25, 2016.
Folks on that message board who did listen in are looking for (wishful thinking?) a dividend increase of 10% (actual announcement should be at the end of April) with a commitment to buy back at least 2% of the shares per year.
All three posts contained an equation with numerical inputs.
The fist post contained a tilde symbol, which I use to signify "about" or "approximate". That's been a problem in the past. I also implied that the scenario I was suggesting would most likely require a change in control, which, of course, eluded to something natural, but unpleasant.
I removed the tilde and reposted. The repost was deleted.
Several days later I removed the offensive change in control language and tried again. The post was again deleted.
I gave up.
For me, the joy was in finally coming up with a solution that works for me to a puzzle that I've worked on since 2003. I don't care if anyone else appreciates it or not.
By the way, my first BRK-B purchase was a dud. Bought on 9/28/1998 at $1,978 per share, sold on 4/8/2003 at $2,305 per share, a 4.5 year IRR of 3.4%. My curiosity was piqued. What did I do wrong? And the journey began.
Thank you for the suggestions, but I'll pass.
By the way, I do appreciate your "heads up" on articles of interest, do read them, and always "thank you" with a thumbs up.