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  • 2Slik

    I’d be shocked if a lot of DFS pros aren’t dipping their toes into the stock market right now. A lot of contrarian plays out there.

  • thedude404

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    @Zieg30 said...

    JNJ seems like a relatively safe company right now given how diversified their business is. I am not too bullish on the vaccine, as there are so many companies racing for one, but they certainly could be the first!

    I was not being critical about buying puts for specific companies. Trading on specific companies is just gambling on both sides of the coin. Some folks think a company is overvalued, some under, etc., and someone has to be wrong. What rubbed me the wrong way was/is shorting the market, generally (by, for example, buying SPY puts). When you short the market, you are basically hoping that there are widespread systemic problems that lead to a large downturn. And that leads to a lot of people losing money, losing their livelihoods, losing their jobs, etc. Here, shorting the market basically means you will be hoping that there’s news of tons of deaths and economic destruction that scares people and the market crashes again. There are many other more ethical/responsible ways to make money when the market is going down.

    When you buy puts on a company, what is the result of the company doing poorly? LOL at your attempt to take any moral high ground over me.

  • Zieg30

    @thedude404 said...

    When you buy puts on a company, what is the result of the company doing poorly? LOL at your attempt to take any moral high ground over me.

    I don’t own any puts right now, and haven’t purchased one since maybe 2012 when I first messed around with options trading. I was merely explaining a distinction I see between buying puts in an individual company and shorting the entire market.

  • thedude404

    • 2015 FanDuel NBA Playboy Mansion Finalist

    @Zieg30 said...

    Thankfully it isn’t mutually exclusive to both judge those actually causing deaths and those hoping for more financial harm to others so that they can make money themselves. I have enough room to do both!

    Once you “predict” that the market will go down, and take a short position, you are no longer “not wanting bad things to happen” because you want your money to increase. At that point, you are, in fact, rooting for bad things to happen.

    You can spin it otherwise however you want.

    I used to work for Merril lynch who was bought out by bac. You think its morally righteous back in 2008 while this country was suffering the clown ceo redid his office including buying a 90k toilet. The next guy was no better taking tens of millions in severance. So if you want to get down to it you are possibly more morally reprehensible by supporting these morally bankrupt clowns than i am shorting the market.

  • Awon1

    @Zieg30 said...

    I don’t own any puts right now, and haven’t purchased one since maybe 2012 when I first messed around with options trading. I was merely explaining a distinction I see between buying puts in an individual company and shorting the entire market.

    Well for me I can’t even buy calls or puts on individual companies so without dfs the only “gambling” I can do is options. I can’t even go to Vegas right now since it’s shut down.

    For options I pretty much have to buy puts or calls so by definition sometimes I’ll have to root against the economy and sometimes for. I’m not one sided though. If we drop like in the next few weeks, I’ll flip to calls. For me I’m merely trading a price, not like taking the human element into account. I’m essentially betting over or under and by how much using options.

  • Zieg30

    @thedude404 said...

    I used to work for Merril lynch who was bought out by bac. You think its morally righteous back in 2008 while this country was suffering the clown ceo redid his office including buying a 90k toilet. The next guy was no better taking tens of millions in severance. So if you want to get down to it you are possibly more morally reprehensible by supporting these morally bankrupt clowns than i am shorting the market.

    No.

  • thedude404

    • 2015 FanDuel NBA Playboy Mansion Finalist

    @Zieg30 said...

    No.

    LOL! Tell that to the thousands who got laid-off including myself due to their greed, ineptness, and borderline criminal behavior.

  • Awon1

    Hey Zieg I have a question. I actually don’t know this answer but may you or theDude404 or superstars92 knows but when you sell something like SPY, isn’t there always a buyer?

    It’s a zero sum game right? So even if I shorted SPY, someone else bought it? So in other words, I’m like not adding a new short to the market, so the market as a whole hasn’t changed in its overall long/short exposure. So in a way even if I short, that just means someone else is long and all I’m doing is facilitating a neutral overall position.

    Is that true? How does that work actually I’m legit curious. How do new shares of SPY get created?

  • thedude404

    • 2015 FanDuel NBA Playboy Mansion Finalist

    @Awon1 said...

    Hey Zieg I have a question. I actually don’t know this answer but may you or theDude404 or superstars92 knows but when you sell something like SPY, isn’t there always a buyer?

    It’s a zero sum game right? So even if I shorted SPY, someone else bought it? So in other words, I’m like not adding a new short to the market, so the market as a whole hasn’t changed in its overall long/short exposure. So in a way even if I short, that just means someone else is long and all I’m doing is facilitating a neutral overall position.

    Is that true? How does that work actually I’m legit curious. How do new shares of SPY get created?

    When you sell something short you are borrowing the shares to sell from someone else. Thats why if when u short a security it has to be done in a margin account. So nobody is buying your short bc you cant sell simething out of thin air. Because if it goes against you enough youre gonna get a margin call. As far as how shorting an etf goes like SPY, im assuming it works the same way. You can actually reach a point where your brokerage doesnt have any more shares available to short. The dude superstars that actually works in the industry now can explain it better than me. As far as creating shares that would be up to the dude running the etf but that would dilute current owners shares and i dont know if that is ever done in an etf besides a reverse split which is somewhat common when an etf reaches a low price but that isnt dilluding the equity bc you get more shares in a reverse split. Again i defer to superstars as he would be more knowledgeable.

    EDIT: so short answer no it isnt a zero sum game. If enough people short a stock on agiven day, that will drive the stock price down. The opposite can be true when the stock goes up…..people who shorted might get a margin call and have to buy the shares back, driving the price up further.

  • superstars92

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    TheDude explains it pretty well the process you go through when you want to short something.

    https://money.stackexchange.com/questions/98418/does-short-selling-create-additional-share-in-the-market

    New long and short positions are created, but no new shares are actually created from the process theDude describes.

    Also if you are referring to options, so in options, they are actually created out of thin air. Check out the open interest column when you trade options. For example, if I wanted to buy the SPY 250 strike put, I will buy it from a market maker (MM) who will then create this new option position in which they’ll be short this option. So the net position is still 0 between us, but I’ll be long 1 of these options and the MM will be short 1.

  • superstars92

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    I think something being overlooked in this coronavirus sell off is the Credit Market.

    Take a look at the 1 year chart or even 5 year chart of HYG. HYG is notoriously almost 0 vol, but it crashed in this selloff. If the credit market goes haywire, that’s a major issue. They’ll also have to sell equities to hedge which makes it even worse.

    Fed seems to have stabilized the Treasury market by all accounts. However the dollar is moving a ton, meaning they are really intervening big time last few weeks.

  • superstars92

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    I have always wondered how market makers price options on leveraged ETFs like SQQQ. It seems very difficult with the decay and rebalance.

  • Awon1

    ok I see yes my broker won’t allow me to borrow shares to short.

  • Awon1

    Futures down big tonight!

  • BIF

    @Zieg30 said...

    Hoping we go down is a bad look.

    I get shorting specific companies that one thinks are overvalued, but I don’t think it’s right to short the overall market. You are then rooting for lots of people to lose money across the country.

    Obviously people make money doing scummier things, but I certainly judge anyone making money solely due to others’ misfortunes.

    I disagree with this statement, the market goes up and it goes down – I’m just trying to find a way to protect myself and make money when things turn – by buying inverse ETFs or other market instruments that make money in a downturn is simply being on the right side of the trade/market.

    If I felt the market was going to go up, I’d be long and cheering for you and everyone else long but we are in a 3-6 month shutdown of almost the entire world economy on the heels of the best bull market in history – if anyone is still long this market, they are foolish and just wiped away 12 years of gains.

  • Awon1

    Ok so I’ll be up on those SPY puts I got. Maybe I’ll be close to breaking even overall too. We’ll see when it opens. I think I’ll still be down a few hundred but better than a few thousand.

    My question is for long term stocks do I buy tomrorow or today?

    I got Microsoft, Johnson and Johnson, and Chewy cleared and I also asked for Costco, Nike, and Google tomrorow. I won’t buy all, but I’ll have that list to choose from. What are the good ones?

    I was thinking Johnson and Johnson and Costco since both seem to benefit from the virus? I don’t have much money so all I can do is like 8 shares of Johnson and 4 of Costco if I get that cleared for tomrorow.

    Should I wait until tomrorow for Johnson and Johnson or just do it today? Costco I have no choice but to wait.

    It’s hard finding the right entry points for long term stocks. Options is hard to make money but at least I won’t hesitate when to buy or sell.

  • Awon1

    @BIF said...

    I disagree with this statement, the market goes up and it goes down – I’m just trying to find a way to protect myself and make money when things turn – by buying inverse ETFs or other market instruments that make money in a downturn is simply being on the right side of the trade/market.

    If I felt the market was going to go up, I’d be long and cheering for you and everyone else long but we are in a 3-6 month shutdown of almost the entire world economy on the heels of the best bull market in history – if anyone is still long this market, they are foolish and just wiped away 12 years of gains.

    I remember you saying you bought Microsoft, Ibm, and Google like a few weeks ago when they were a bit lower.

    Why did you choose them over like a company like Costco or Johnson and Johnson? Is it just because they are technology?

  • Awon1

    Also I plan on selling the either 225 or 230 put now the market is lower to turn my 245 into a put spread. I’ll get a good deal too since the market is much lower now I collect way more on the 225/230 put.

    I’m looking for the market to go to 225 or 230 by middle April for max gain.

  • BIF

    @Awon1 said...

    I remember you saying you bought Microsoft, Ibm, and Google like a few weeks ago when they were a bit lower.

    Why did you choose them over like a company like Costco or Johnson and Johnson? Is it just because they are technology?

    I sold out of them a couple days earlier as I bought on weakness – made a couple bucks overall but nothing special and will look to re-buy again over next few weeks. Don’t think I said MSFT but probably had AAPL in there.

    Why those ? I believe tech makes a quicker and sharper recovery than companies in consumer or retail sectors as they haven’t been hurt as bad. JNJ and COST are great companies but I was referring to trades I think that will outperform market and also first to recover.

  • Awon1

    @BIF said...

    I sold out of them a couple days earlier as I bought on weakness – made a couple bucks overall but nothing special and will look to re-buy again over next few weeks. Don’t think I said MSFT but probably had AAPL in there.

    Why those ? I believe tech makes a quicker and sharper recovery than companies in consumer or retail sectors as they haven’t been hurt as bad. JNJ and COST are great companies but I was referring to trades I think that will outperform market and also first to recover.

    Ok thanks – yes I probably misremembered with all the posts about Apple vs Microsoft.

    I see, I didn’t know you were trading short term. I’m trying to find some more longer term trades but I guess longer term, technology is the same idea in terms of making a quicker recovery.

    I might just buy QQQ or something similar then in that case since I know that’s a lot of technology stocks. I already have the Vanguard Total Return in my 401k, so I might elect to switch that to the Technology sector instead of a general market fund.

    Hmm ok I guess I will wait tomrorow and then pick which one to buy. I think I’ll just stick with Costco and Johnson and Johnson tomrorow, provided they are ok with Costco, and then switch my election to more technology stocks in my 401k for the next rebalancing.

    I hope it goes down more today so I can get a better price! It’ll also help my puts.

  • Awon1

    @superstars92 said...

    I have always wondered how market makers price options on leveraged ETFs like SQQQ. It seems very difficult with the decay and rebalance.

    Hey I have a question. I know you mentioned SQQQ in one of your first posts about shorting the market. I also saw that theDude404 mentioned he had calls on it later and now also Bif said he had SDOW short term in the NBA thread which is the same idea but with DOW instead of QQQ.

    So what you are saying is if I wanted to just short the market but my broker doesn’t allow me to actually short shares, I literally can just buy like SQQQ or SDOW? I know those are leveraged so it’s like a 3x short.

    However is there something else I’m missing that I need to know? You mentioned decay. What does that mean? Does that mean if the market were to be flat, these will lose value because of decay, instead of just remaining flat?

    I’m trying to figure out exactly what these are since I might resort to buying like SQQQ or more likely SDOW, since QQQ has more technology, in the future. My broker doesn’t allow me to just short things.

    These are all ETFs so I should be cleared already.

  • BIF

    @Awon1 said...

    Ok thanks – yes I probably misremembered with all the posts about Apple vs Microsoft.

    I see, I didn’t know you were trading short term. I’m trying to find some more longer term trades but I guess longer term, technology is the same idea in terms of making a quicker recovery.

    I might just buy QQQ or something similar then in that case since I know that’s a lot of technology stocks. I already have the Vanguard Total Return in my 401k, so I might elect to switch that to the Technology sector instead of a general market fund.

    Hmm ok I guess I will wait tomrorow and then pick which one to buy. I think I’ll just stick with Costco and Johnson and Johnson tomrorow, provided they are ok with Costco, and then switch my election to more technology stocks in my 401k for the next rebalancing.

    I hope it goes down more today so I can get a better price! It’ll also help my puts.

    I’m normally more of a buy/hold guy but when volatility goes up I feel you need to be more active.

    I bought AAPL about 8-10 years at $420 a share (before they split 7-1) so I effectively paid $60 a share. I held it the entire time until about 3 weeks ago and got out for $285 and change. I’ll definitely be a buyer again and likely hold but would like a little better price than it is now.

  • Awon1

    @BIF said...

    I’m normally more of a buy/hold guy but when volatility goes up I feel you need to be more active.

    I bought AAPL about 8-10 years at $420 a share (before they split 7-1) so I effectively paid $60 a share. I held it the entire time until about 3 weeks ago and got out for $285 and change. I’ll definitely be a buyer again and likely hold but would like a little better price than it is now.

    Wow nice that’s a big return on Apple.

    I’m hoping some of the stocks during this crisis which are now cheap can pull off a similar return. Heck I would take 50% of that Apple return even.

  • BIF

    @Awon1 said...

    Wow nice that’s a big return on Apple.

    I’m hoping some of the stocks during this crisis which are now cheap can pull off a similar return. Heck I would take 50% of that Apple return even.

    That has been my shining star but really anything you bought in 2009ish and sold Before the last month was likely a huge 100+% gain

  • Awon1

    Dang market going up.

    Some of these stocks I have like AMD are currently green. Say what?

    Microsoft too is almost green on the day. I’m actually not happy about this. Long term these stocks were bound to go up anyways so I actually need some of these stocks like AMD, Microsoft, and Amazon to go down today. I’ll take the hit on my stocks to win on my puts since my stocks will come back anyways and my pits have a much shorter expiration. I also want a good price to enter tomrorow but Costco is wanting to go green too please stay down!

  • Awon1

    How in the world is Jay Powell able to pump this much money?

    Half of my watch list of stocks I want to track are green.

    Disney, Microsoft, AMD, Costco, Wal Mart, what is going on….

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