[Coronita]

Provident is showing this BTW:

https://www.provident.com/

[Coronita]

[quote=AN][quote=flu]I envy you guys. I wish I had a home worth taking a 30year out on right now…[/quote]Cash out refi?[/quote]

You’re killing me and mocking me at the same time, lol…..

I’m an old man now… And old fart… I’m expecting my AARP card in the mail anyday now, and I think I should go shop for an oldsmobile. The thought of having another 30 years to go….Dude….I’m going to be eating out of a straw…

No sir, only going to happen with another home purchase….I can’t find anything good though. Rental or Primary…

[Coronita]

SK. Is the purpose of rolling the option contract because you make more money from the option premimum in the new options that expire much later versus the option premium left on the existing contract that you will close early?

I don’t think I have the skills to really do this myself, but am really curious how people who know what they are doing do this….

Also, just curious… Do you cast a wider net and buy more companies/etfs/etc with fewer contracts each one, or are you concentrating on a few, and loading up on contracts per each one?

Thanks for sharing so far. I appreciate it when smarter people are willing to share things they are doing, even if I probably fvk it up myself if I tried to do the same thing, lol….

[Coronita]

[quote=SK in CV][quote=flu]

Sorry, I’m not following the 10% yield using covered calls. Care to explain? I’m really slow about these things….

When you first mentioned $1/premium a share….I was wondering why are you doing this for a $1/share…But then you put it into a bigger context for me $12/year for a $175/share… I never thought about it this way. Just curious, I think I know, but what are the worst case scenarios wrto downside risk, beyond what you already sort of highlighted with the example with T? ..I appreciate you sharing…I was just reminded there are a lot of smarter people out their in this world than me, lol….[/quote]

I missed an important step. On the DIA trade, which is where the “$12/yr for a $175/share” came in, I didn’t mention that I’m rolling it every month. The sweet spot is getting in at about 45 days from expiration, and I try to roll at about 15 days. Rolling spreads can be difficult sometimes, particularly when trying to adjust the strikes. Often, I end up buying the current month back and selling the next month. I had orders in to roll spreads in 3 different accounts all day Thurs & Friday and couldn’t get a fill. It was slightly early because I was trying to take advantage of the higher following month volatility. I’ll probably buy them all back on Monday and sell Aug spreads at whatever strikes make sense.[/quote]

[Coronita]

[quote=SK in CV][quote=flu]
Dumb question. If one thinks the stock is going to rise, why not just buy the stock? What advantage does this put spread have over just buying? Excuse the dumb question…

The only option trading I’ve ever done was to either write covered calls or buy put options as a hedge against company issued stock options or RSUs that were unvested and/or nearly vesting…and that was back a long time ago, when companies didn’t have so many policies about owning derivatives as an employee…So I’m curious how people are using these other strategies.[/quote]

Not a dumb question at all. In fact, it’s one that I’ve asked 100 times. As it happens, the woman sitting next to me has made a living trading futures and options for the last 5 or 6 years. And I’m following her lead. It has to do with use of capital….even though I’m sitting with a lot of cash, I have these derivative non-cash positions that are hopefully making me money. I’m not convinced it’s the right thing.

Diamonds (Dow ETF) is now paying about 2.754% I think. She convinced me that instead of buying a few hundred shares, I should sell a wide put spread and take in (at current volatility) about $100 a month. That’s $12/yr on a $175 stock that I haven’t actually bought. 6.66% is a pretty decent return. Now if I had actually bought it, or it gets put to me, i’d sell covered calls against it every month. I’d limit my upside but increase yield to upwards towards 10%.

As I said, I follow her. I ask her the same question at least once a month. And she’s way smarter than I am. So I listen. (And she doesn’t read here, so I don’t score any points by saying that.)[/quote]

[Coronita]

SK, if you don’t mind can we continue our discussion here?

http://piggington.com/ot_are_you_doing_anything_hedge_against_possibility_brexit_take

I’m going to rename this thread, the Donald Trump/Illegal Alien Bitch and Moan Thread.

[Coronita]

[quote=SK in CV][quote=flu]
Dumb question. If one thinks the stock is going to rise, why not just buy the stock? What advantage does this put spread have over just buying? Excuse the dumb question…

The only option trading I’ve ever done was to either write covered calls or buy put options as a hedge against company issued stock options or RSUs that were unvested and/or nearly vesting…and that was back a long time ago, when companies didn’t have so many policies about owning derivatives as an employee…So I’m curious how people are using these other strategies.[/quote]

Not a dumb question at all. In fact, it’s one that I’ve asked 100 times. As it happens, the woman sitting next to me has made a living trading futures and options for the last 5 or 6 years. And I’m following her lead. It has to do with use of capital….even though I’m sitting with a lot of cash, I have these derivative non-cash positions that are hopefully making me money. I’m not convinced it’s the right thing.

Diamonds (Dow ETF) is now paying about 2.754% I think. She convinced me that instead of buying a few hundred shares, I should sell a wide put spread and take in (at current volatility) about $100 a month. That’s $12/yr on a $175 stock that I haven’t actually bought. 6.66% is a pretty decent return. Now if I had actually bought it, or it gets put to me, i’d sell covered calls against it every month. I’d limit my upside but increase yield to upwards towards 10%.

As I said, I follow her. I ask her the same question at least once a month. And she’s way smarter than I am. So I listen. (And she doesn’t read here, so I don’t score any points by saying that.)[/quote]

Sorry, I’m not following the 10% yield using covered calls. Care to explain? I’m really slow about these things….

When you first mentioned $1/premium a share….I was wondering why are you doing this for a $1/share…But then you put it into a bigger context for me $12/year for a $175/share… I never thought about it this way.

Just curious, I think I know, but what are the worst case scenarios wrto downside risk, beyond what you already sort of highlighted with the example with T?

I guess, I’m just wondering that if you happen to be in a situation in which the stock prices falls below the put you wrote, but above the put you bought, chances are you have to buy the stock….What is your exit strategy at that point? Your own the stock, your put option you bought is out of money (although unexpired).. Now what?

Also, for a company like ATT that is playing close to a 5% dividend, does the ex-dividend date play any role into when you implement your strategy… Do you try to get the dividend, do you try to avoid the dividend buy doing your transactions after the ex-dividend date, or does it not matter?

I appreciate you sharing…I was just reminded there are a lot of smarter people out their in this world than me, lol….

[Coronita]

[quote=svelte][quote=flu][quote=svelte].[/quote]

ok come on now, what’s wrong with what you posted?[/quote]

Nothing wrong with it. Upon reviewing it today, I realized it was pretty much a threadjack and had the potential to give just enough info to ID me, if read by the right ppl. I like my anonymity and don’t like to drag conversations off track, so I deleted it.

If it intrigued you and you wanted to discuss, we could discuss in pigg message space, but not out here.

Shoot, wouldn’t even mind going out for a drink sometime (if no photos taken) since I feel like I know you from all your posts. I’ve never come to a pigg meetup because folks post pics of them on here afterward, and again I’d lose the anonymity that I want to protect.[/quote]

Just busting your chops…….and understand your interest for anonymity…. I figured that…Peace…

[Coronita]

[quote=SK in CV][quote=flu]SK, forgot to ask earlier also. What kind of put spread are you doing on VZ and T?[/quote]

On T, I think I sold a put at $40 and bought a put at $35, and took in about $1 premium. Options are quoted as a single share but trade on a 100 share contract, so I took in about $100. (Actually 2, since I sold/bought 2 contracts) My max risk is the difference between the two or $500. If the stock falls below $40, it can be put to me, and I just ended up buying T for $39/sh. With its current dividend, I wouldn’t mind owning it at $39. VZ was similar, I think the strikes were $52/47 and I didn’t take in quite a buck. That was right at the open when vol was really high. If the bottom falls out, i’m out $500. If nothing happens, I keep my premium. If it falls a few bucks, i’m in at $51 and change.[/quote]

I get it…So basically, a bull put spread, i think…

*It nets you $1/share (1 contract = 100 shares, knew that…) immediately…

*If stock doesn’t move or rises, both put options expire, and you keep $1/share.

*If the stock tanks, to say $45/sh, you’re limiting your damage, because you have to buy the stock at $52 (the put you sold), but you can sell at $47 (the put you bought)….So you’re limited damage is $400 ($4/share, after the $1/share premium you were already paid)

*If the stock ends up somewhere in the middle, say at $49… The $52 gets exercised and you buy the stock at $52/share, less $1 in option premium you were already paid.

I’ve read about some of these option strategies a long time ago, but didn’t know what they were for….

Dumb question. If one thinks the stock is going to rise, why not just buy the stock? What advantage does this put spread have over just buying? Excuse the dumb question…

The only option trading I’ve ever done was to either write covered calls or buy put options as a hedge against company issued stock options or RSUs that were unvested and/or nearly vesting…and that was back a long time ago, when companies didn’t have so many policies about owning derivatives as an employee…So I’m curious how people are using these other strategies.

[Coronita]

[quote=SK in CV][quote=flu]SK, if you don’t mind me asking. What do you mean by “junk” silver and gold? Are these jewelry/home furnishing items?…If so, have these actually appreciated from the time you bought them? I’m just curious how this works outside of the traditional coin/bullion….I was under the impression that most other forms of precious metals have terrible appreciation, but I don’t know anything about this.[/quote]

Junk silver is silver coins generally pre-1963 before they started adding copper. They’re 90% silver and sell for 90% of spot price less the dealers vig. The price per dollar stays pretty consistent across silver dollars/halves/quarters/dimes. These are all coins with no numismatic value.

Junk gold is jewelry kind of stuff with no actual jewelry value and they sell at spot price, adjusted for purity, less dealer vig.

None of the jewelry was bought for investment. At least by her. My wife’s late father was sort of an eccentric guy and he started buying metal in the early 60’s, maybe earlier. He had swiss bank accounts and safe deposit boxes at least as far back as ’67. He bought and sold businesses around the world and on most every trip he’d bring back gold jewelry for his wife and daughter (my wife). So she has what seems like an unlimited supply of gold chains, rings, pins, etc. So at least some of that was bought when gold was $35/oz.

Both junk silver and junk gold move the same way as spot gold and silver price. As I said a few weeks ago, to unload this stuff you have to have a dealer that doesn’t take too big a cut. The guy my wife (and occasionally I) deals with has a store that says “we buy gold”. It’s just one of those guys she’s built a relationship with. I don’t know exactly how he disposes of it, but I’m sure he’s doing something with gold and silver futures on a daily basis. I know he has at least a ton of silver on display in inventory. I’m guessing he lays off the gold as quickly as possible, though he has an inventory of at least 1000 gold coins. It’s an expensive business to be in.[/quote]

Great, so the lesson to learn here
1) is father leaves daughter a bunch of gold and silver from old days.
2)…and daughter, when married, tells husband to dispose of gold and silver as “junk” to a local shop guy, called “Butch”…

Lovely… I have this to look forward to. Why am I buying gold and silver again, and where is my Porsche ordering guide again?

Just kidding.. I’m just busting your chops. 🙂

$35/ounce for gold… Damn….I was more thinking there might some some treasures in that history of items.

[Coronita]

[quote=zk]Well played, flu. Little flu gets a life lesson and a laugh. Man, sometimes being a Dad is great, isn’t it? Happy Father’s Day![/quote]

I’m not so sure… The lesson is “the customer is always right, no matter how unreasonable?”

It’s actually quite interesting though. My daughter thought the person was being completely unreasonable. But, I never taught her to think that way. It made me wonder where do people learn where to draw the line? I mean, to some people, this was outrageous, to others I’m suspecting otherwise….

[Coronita]

[quote=svelte].[/quote]

ok come on now, what’s wrong with what you posted?

[Coronita]

SK, forgot to ask earlier also. What kind of put spread are you doing on VZ and T?

[Coronita]

[quote=SK in CV][quote=flu]Back on topic…So you folks feel gold, silver, platinum is moving higher or are we about done with the volatility?

I’m looking at platinum prices and things really haven’t taken off on platinum yet. Historically, the spread between gold and silver hasn’t been that much and there hasn’t been too many times in the past where 1 ounce of platinum is less than 1 ounce of gold…

Platinum’s industrial use (aside from jewelry) is in the catalytic converters for gasoline engines…

Palladium on the other hand is used in the emissions system of diesels, and I’m not aware of a jewelry/consumer use.

Platinium sells for about $130-140 above spot prices. But it’s also still one of those coins eligible for ebay 8% bux rebate offers, meaning if you wait, you can get them for about $100 off, or $30-40 above spot….

Gold on the other hand, you can find $20-30 above spot, but dealers have been pulling gold from the ebay bux rebate offers….Plus, I’m not convinced gold can hit $1400/ounce anytime soon.

Thoughts?

Speaking of which…

http://www.ebay.com/itm/SPECIAL-PRICE-2016-1-oz-Gold-Great-Britain-Britannia-Brilliant-Uncirculated/121818247497

Now, if only ebay would run it’s 3x ebux offer, you could get $100 off and get this $67 below spot, which still is expensive imho.

or platinum, which usually doesn’t go on sale, but you could get $100 off from ebay
http://www.ebay.com/itm/111916532267%5B/quote%5D

I just came home from the gym to find a 15-20lb bag of junk silver and a tray full of a couple ounces of junk gold sitting on the counter. That means my wife is thinking about going to see her guy. It’s nowhere near a significant piece of her holdings, (I think there’s about 40 similar bags of silver) but she usually sells a bit when she think its somewhere near a short term high. She’s in looking at her charts now. If she comes out with a conclusion I’ll pass it on.

Edit added: She put it all away. She not sure it’s going higher.[/quote]

SK, if you don’t mind me asking. What do you mean by “junk” silver and gold? Are these jewelry/home furnishing items?…If so, have these actually appreciated from the time you bought them? I’m just curious how this works outside of the traditional coin/bullion….I was under the impression that most other forms of precious metals have terrible appreciation, but I don’t know anything about this.

[Coronita]

Back on topic…So you folks feel gold, silver, platinum is moving higher or are we about done with the volatility?

I’m looking at platinum prices and things really haven’t taken off on platinum yet. Historically, the spread between gold and silver hasn’t been that much and there hasn’t been too many times in the past where 1 ounce of platinum is less than 1 ounce of gold…

Platinum’s industrial use (aside from jewelry) is in the catalytic converters for gasoline engines…

Palladium on the other hand is used in the emissions system of diesels, and I’m not aware of a jewelry/consumer use.

Platinium sells for about $130-140 above spot prices. But it’s also still one of those coins eligible for ebay 8% bux rebate offers, meaning if you wait, you can get them for about $100 off, or $30-40 above spot….

Gold on the other hand, you can find $20-30 above spot, but dealers have been pulling gold from the ebay bux rebate offers….Plus, I’m not convinced gold can hit $1400/ounce anytime soon.

Thoughts?

Speaking of which…

http://www.ebay.com/itm/SPECIAL-PRICE-2016-1-oz-Gold-Great-Britain-Britannia-Brilliant-Uncirculated/121818247497

Now, if only ebay would run it’s 3x ebux offer, you could get $100 off and get this $67 below spot, which still is expensive imho.

or platinum, which usually doesn’t go on sale, but you could get $100 off from ebay
http://www.ebay.com/itm/111916532267

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