Brexit

[vector2]

I make a few grand a month using covered calls on stocks that I own. I've made quite a bit on AAPL and FB. And some on SPY. But I'm long on all these stocks. Most of my positions are in SPY and DIA.


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The options liquidity sucks (relatively) on VOO and VTI, but you should still consider these or the ishares equivalents in lieu of SPY for longterm holds. They're not trusts, lower expense ratio, fund can reinvest divvy, etc

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[vector2]

I've always planned to do that once I own enough shares to make selling calls worthwhile. How much have you lost by missing out on gains? I'd imagine that long term you make more selling calls than you miss out on. What time horizon do you use?

If he's doing it wisely, odds are he's selling shorter dated out of the money calls after the stock has had a big run up and is in overbought territory on a daily or weekly timeframe. Very good risk to reward in these situations.

 

[caligas]

I've always planned to do that once I own enough shares to make selling calls worthwhile. How much have you lost by missing out on gains? I'd imagine that long term you make more selling calls than you miss out on. What time horizon do you use?

First ask yourself how you will feel being FORCED to sell shares of a winning stock at below market (possibly well below market) rates. If you can accept this scenerio, than proceed.

 

[urge]

Can somebody explain to me why the market has been up in the past few days? Hope you guys were not short.

 

[deleted171991]

Can somebody explain to me why the market has been up in the past few days? Hope you guys were not short.

Because people have started buying, after the world didn't end yet again. It's a sale, it's a sale...

 

[urge]

Because people have started buying. It's a sale, it's a sale...

My stocks are better post Brexit doom and gloom than they were before Brexit.

Brexit is great. Which other country wants to leave the EU?

 

[deleted171991]

My stocks are better post Brexit doom and gloom than they were before Brexit.

Brexit is great. Which other country wants to leave the EU?

Whatever goes up will come down.

 

[periopdoc]

For every successful trader like Periop there are at least 100 others who will lose money in the market. This is fact and has been demonstrated in many studies. That said, there are individuals with great talent out there who know how to use Options, Short selling, Stops, Pair-trades, etc to make serious money.

If you want to "dabble" in the market limit the amount of money to no more than 5% of your portfolio. For many that 5% will be lost in less than a year or less especially if they have no experience with trading, options, etc.

You are absolutely right. Do not dabble in trading except with your fun money. The market is a voracious shark with no remorse. Since I trade almost exclusively in options, every dollar I make is a dollar lost by some poor sucker. I don't care.

Still, there is something so beautiful about a well executed plan.

I took a flyer short SPX bet on Brexit with profits that I made long in the days prior to the vote. My stops activated well below 2000. Still holding longs from that point.

My stocks are better post Brexit doom and gloom than they were before Brexit.

Brexit is great. Which other country wants to leave the EU?

Why Is the market up? Very simple actually. Central banks worldwide are propping up this market like a rotten wooden peg leg on a morbidly obese sailor. Even before the vote, Yellen mentioned Brexit as an excuse to not raise rates. That reinforced the loud and clear message that the fed has been sending at every meeting. They will do whatever it takes to keep the market propped. The ECB made statements to the effect that they would support the system through the turmoil.

If the two biggest banking and governmental systems in the world have your back, why wouldn't you run the market up? A better question is why, given central bank support, did it fall so far in the first place? A brief acknowledgement of the real economic situation of the world?

Quant traders rode the wave down and back up, but the drop was due to scared longs selling off, not quant traders pushing it down.

Another Brexit would be awesome. I love it when the market gets killed off. $$$$$

 

[periopdoc]

Of course, when you look at the asset classes that led the rebound, you get a clearer picture of investor sentiment, and you wonder if faith in central banks is waning.

Risk off assets are leading the way. Utilities, consumer staples, and financials were the big winners yesterday as the big funds closed out their quarters. Bond yields just keep falling.

As the quarter drew to a close yesterday, funds were looking for safe, defensive plays rather than growth stocks. A rising tide lifted the whole market, but growth, discretionary, and real estate lagged.

 

[sevoflurane]

Of course, when you look at the asset classes that led the rebound, you get a clearer picture of investor sentiment, and you wonder if faith in central banks is waning.

Risk off assets are leading the way. Utilities, consumer staples, and financials were the big winners yesterday as the big funds closed out their quarters. Bond yields just keep falling.

As the quarter drew to a close yesterday, funds were looking for safe, defensive plays rather than growth stocks. A rising tide lifted the whole market, but growth, discretionary, and real estate lagged.

Nice work. I kept it simple.
Dropped in a good chunk of side funds into VTSAX when the DJI was at 17300 ish.
Surprised by the quick rebound.

 

[G-Man82]

I chose the Brexit period as my chance to buy into and start my small value allocation. It was great.

I index, like a lot of others who read WCI and fashion themselves to be Bogleheads. So I don't really understand options and stop orders etc. If you own the market, there's no need to. I won't sell out of VTSAX (Vanguard Total Stock Admiral Class index fund) today or in the next bear market.


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[periopdoc]

Ahahahahahahaha. Brexit plan take 2. Short ES, long Gold at market close. Now we have an epic dip to buy. I only wish I had a forex account so I could have shorted the peso

 

[periopdoc]

It may be a little trickier than last time as Yellen may not backstop Trump.

 

[Chip N Sawbones]

Ahahahahahahaha. Brexit plan take 2. Short ES, long Gold at market close. Now we have an epic dip to buy. I only wish I had a forex account so I could have shorted the peso

What happened to the epic dip you and I were expecting? I sold most of my stocks at the opening bell, expecting the markets were about to take a dive. Bought everything back a little later for a small gain when it was clear there wasn't going to be a disaster. I thought for sure it was going to be worse.

 

[periopdoc]

??? Futures fell over 120 points. How much more of an epic dip can you ask for?

By the time I posted here, I had already stopped out of gold and had initiated my long futures positions. I added long SPY and my favorite Pharma positions and short SWHC and RGR at open. Still have the long positions. I bought my shorts back at market close yesterday.

Another Brexit style, wild ride.

 

[Chip N Sawbones]

I don't deal in futures yet (I'm on a med student budget) so I was mostly concerned with the actual markets, which didn't dip at all. Good move shorting SWHC and RGR, though.

 

[periopdoc]

Republican took the presidency and retained both houses of congress. Just about the most bullish scenario that could come from the election. Looks like I exited SWHC RGR a little early.

 

[Chip N Sawbones]

Republican took the presidency and retained both houses of congress. Just about the most bullish scenario that could come from the election. Looks like I exited SWHC RGR a little early.

SWHC and RGR might be worth going long on as longer-term holds once the dust settles. There won't be any panic buying from people afraid Hillary is going to take their guns, but on the other hand they've got a guaranteed four years of no gun control at the federal level. Also, I'll bet a lot of Hispanics and Muslims will be buying guns in the next month or two. It looks like CXW and GEO were the real buying opportunities over the last two days, though.