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Many Thanks -- EOM
Hello Dew, Hope you are doing well.
I am wondering if you can clear something up in my old foggy mind with this news?
Does this joint venture allow PCL to "write off" from their current balance sheet, the funds that go into the partnership, thereby allowing only upside to be reported from any gains within the partnership down the road, as it will already basically have been "written off?"
Thanks for any help.
Take Care.
just a heads up that this stock offers options with a 1 dollar strike price that expire in 452 days from today. I bought protection puts to protect the shares I have a while back when the share price fell to .73, and then bought some of the same dated calls on the same day in case there is some upside in the next 1.xx years, to magnify any possible profits.
posted trade on the general stocks ideas board not long after making it.
wfiw
take care.
This unusual options trade signals that Wall Street is bracing for a black swan
====I added the bold and red highlight. scs...I read it yesterday but searched for again as I wanted to post it here. take care.====
http://www.marketwatch.com/story/this-unusual-options-trade-signals-that-wall-street-is-bracing-for-a-black-swan-2015-10-13
Published: Oct 13, 2015 5:45 p.m. ET
CBOE Skew Index hit an all-time high on Monday
By Mark DeCambre
Blame it on a looming interest rate hike, sluggish global growth or conflict in the Middle East, but investors are girding for the worst!
That is apparently what Ryan Detrick, head strategist at Kimble Charting Solutions, thinks. He points out that unusual options buying on Monday signaled that Wall Street investors are fretting about the possibility that the market could be whacked by a stock-market crisis.
Detrick said that the so-called CBOE SKEW Index—a measure of fear in the market hit an all-time high on Monday. The options contracts are used to make a bet on the direction of the S&P 500 SPX, -0.47% Essentially, the SKEW measures what investors are willing to pay for put options compared with call options on the S&P 500.
A put option confers the right to sell an underlying security, in this case the S&P 500, at predetermined strike price at a predetermined time. Think of it as buying insurance, if you own the underlying asset. And a call option grants the right to buy.
Detrick said on Monday the CBOE SKEW saw demand for buyers of protection spike above levels not seen in more than 20 years.
“That action [in the CBOE SKEW] showed that [investors] are on edge and are worried about some unknown event that could push equity prices lower,” he told MarketWatch.
Here’s a look at Detrick’s chart, which appeared on Kimble Charting Solutions Tuesday, illustrating the spike:
The CBOE SKEW usual trades between 100 and 150. Detrick said that the SKEW spiked back in September 2014 amid fears about Ebola, but its rise on Monday eclipsed its highest levels hit in the 1990s, as the chart shows:
It is important to note that the CBOE SKEW differs from the so-called CBOE Volatility Index VIX, +2.04% —another measure of implied volatility, known as the fear gauge. The Vix stands at 17, well off its high of 52, reached during the Wall Street rout back in August spurred by worries about petering economic growth in China, the world’s second-largest economy.
Detrick said it isn’t all gloom and doom because it is hard to truly gauge what a spike in the SKEW means, the Vix is hovering at relatively low levels. He does, however, offer a chart of past periods in which the SKEW has spiked and how the market has performed afterward:
Ultimately, Detrick said the SKEW may offer little insights into the psyche of traders. But it might be worth paying attention to if things go south fast.
‘Super Crash’ theory says you shouldn’t be chasing these gains
MarketWatch By Barbara Kollmeyer 7 hours ago
http://finance.yahoo.com/news/super-crash-theory-says-shouldn-133338821.html
Critical intelligence before the U.S. market opens
Paramount/Courtesy Everett Collection Happy Columbus Day? D MA MB MC MD ME MG ZF ZG ZQ ZR ZS ZT ZU
It’s Columbus Day, which could be one last opportunity to stretch and take a look around before earnings start hitting us in the face, beginning with banks tomorrow. That’s coming off what was the best week for the S&P 500 so far this year, partially fueled by a rebound for commodities prices.
But with the gains comes more angst. What we need to figure out, says IG’s market strategist Evan Lucas, is if markets are at a “fundamental conviction buying point or a short-term cyclical move where what goes down must come up — which leads straight into the next part of the cycle, in what goes up will come down (at some point).”
Our call of the day is pointing down for sure. It comes from a guy who’s got a reputation for predicting market selloffs. To be sure, volatility is likely not off the table as earnings start rolling in. That’s one thing to keep an eye on, but keep another eye on the dollar. Our chart of the day tells why it’s going to be compelling for this market.
Got a third eye? Then fix it on central banks. It was a busy weekend in Lima, Peru, for the IMF. Our crashy call of the day had a contender in China’s finance minister Lou Jiwei who said the U.S. should “bear more global responsibility” and is in no shape for a rate hike. That’s opposed to his central-banker buddies who said the Fed should get on with things.
But really, if that China official is worried about the fallout from a U.S. rate hike, then he should be relieved by what Yi Gang, the People’s Bank of China deputy governor, had to say. Gang’s comment that his country’s stock-market correction is “almost over,” along with more stimulus, helped send China stocks on a tear. So strike China off the list of worries for Wall Street. Right?
Key market gauges
Dow (XCBT:YMZ5) and S&P (GLBX:ESZ5) futures are doing what could be expected on a government holiday (but not markets, sorry), showing little change. Read more about what technical analysts are watching after last week’s big market rally.
The Shanghai Composite (XSHG:SHCOMP) closed up 3.3%, helped by news of a new plan from Beijing to boost bank lending. Markets are closed in Tokyo for a holiday. Europe stocks(XSTX:SXXP) pulled lower, putting the longest winning streak in nearly three months at risk. Crude oil(XNYM:CLZ5) continues to rise after in the wake of last week’s U.S. rig-count declines. Gold (XCEC:GCZ5) is picking up where it left off last week, with prices up again nicely this morning. The dollar(IFUS:DX-Y.NYB) is slightly lower.
The call
Anyone chasing stock prices here is setting up to get burned, says Michael Lewitt, who is editor of The Credit Strategist newsletter and known as of the few strategists to predict the 2008 financial crisis. He believes the mini crash in August was just a foretaste of the beginning of the “Super Crash” that’s still to come.
In a blog post, Lewitt says much of last week’s gains can be chalked up to short covering. On the surface they look great, but “do not be fooled.” He says cap-weighted indexes are showing a pulse, but most of the rest of the market is dead, with losses of 20% or more for anything linked to commodities.
Sure, markets are right in thinking the Fed isn’t going to hike rates by the end of the year, but no one should be under the illusion that this will keep stock prices rising. “There are a lot of fund managers and pundits who have been 100% wrong about the market this year and are desperately praying for a huge fourth-quarter rally to bail out their reputations,” he says. He expects gloomy fourth-quarter growth. More from Lewitt here.
But Hui cautions to keep an eye on the dollar, which he says is breaking down on a technical basis.
If the dollar is going to weaken further, that could boost earnings of U.S. companies with overseas earnings, which is something cyclical stocks have already been anticipating, he says. A dovish Fed will keep that up, but if the Fed starts making hawkish noises then the dollar bulls could find some “wind at their backs,” he warns.
Earnings
J.P. Morgan (JPM) , Goldman (GS) and Citi (XNYS:C) will report this week, giving investors a taste of how bad this earnings season could be. It all kicks off in earnest on Tuesday. Here’s a preview
The buzz
Southwest Airlines (LUV) had a tech glitch this weekend that delayed 450 flights. By Monday, it’s still hasn’t quite been cleared up.
Wow! line for ticketed passengers waiting 2 go thru security at LAX for Southwest Airlines almost at next terminal pic.twitter.com/nJuY2IsLPh
— Jane Yamamoto (@JaneNews) October 12, 2015
China Sausage Maker Says May Miss Bond Payment as Defaults Mount
by Bloomberg News
October 12, 2015 — 7:14 AM EDT
http://www.bloomberg.com/news/articles/2015-10-12/china-sausage-maker-says-may-miss-bond-payment-as-defaults-mount
A Chinese sausage maker said it’s not sure if it can repay a bond after its director was put under house arrest, the latest case in China mixing corporate governance and debt problems.
Based in the eastern province of Jiangsu, Nanjing Yurun Foods Co. is suffering cash shortages and great risks in its finances and operations, it said in a statement posted on the Chinamoney website. The company, which sold 1.3 billion yuan ($206 million) of bonds at a yield of 5.49 percent in 2012, must repay 1.37 billion yuan in principal and interest due Oct. 18, according to the statement. As that’s a Sunday, the effective due date is the following day, it says.
Investors are growing alarmed as slowing economic growth and a fight against corruption compound strains in China’s 42.2 trillion yuan bond market. There have been four defaults this year, including one by China National Erzhong Group Co., according to China International Capital Corp. Kaisa Group Holdings Ltd. became the first Chinese developer to renege on a debt obligation in the offshore bond market in April after founder Kwok Ying Shing resigned amid a corruption probe.
“Corporate governance issues are more easily exposed when the economy is not doing well,” said Ivan Chung, a senior vice president at Moody’s Investors Service in Hong Kong. "Because many of those companies don’t have good succession plans, investigation into a key manager could affect the company as a whole.”
Designated Residence
Hong Kong-listed China Yurun Food Group Ltd., parent of Nanjing Yurun, said earlier this year honorary chairman Zhu Yicai’s family informed it that the People’s Procuratorate was restricting Zhu to a designated residence from March 23, according to a statement. The company said at the time it hadn’t received any legal documents from the procuratorate or any government authorities on the matter. Monday’s statement said Zhu’s situation had "indirectly affected" operations, without elaborating on his current status.
Nanjing Yurun Foods suffered a loss of 400 million yuan for the first half of this year. It is still trying to raise money to repay the debt, today’s statement said.
didn't like that swing today from down 250 to plus 200, finger on button to get more ctix at 1.43, but passed. was going to sell half of the puts on zbh if got to 100% up the other day, went from 22.5 to 72.5% in hours, still 100+ days left, but don't like the action, like they can smell the continuation of free money, at least for the time being. maybe this year, September was October.
ugg.
yea, there were a few trades down at that 88.xx level, but only about 500 or so, then normalized, acting a bit stronger than I would like, but that goes with out saying......
thanks gfp, couple days ago when market was up near 1.47%, zbh was only up .15%, so I took that as a sign that it may not be on the top buy lists it was once on.
take care, getting hammered with rain here, gov declared state of emergency, expecting major flooding, and we are already saturated from last couple weeks.
take care.
===with the IMF designed to become the unchallenged central bank of the world.===
complete with its 7 BILLION tax slaves, ugg.
yikes, now 72.5% gain on those puts as they look like they are trying to defend right around 91. I was convinced that foreign nations were buying it when it was rocketing up to 122 not too long after I bought those puts when it was 111.
hang in there, you can buy those pills to protect your thyroid that the us gov. gives out in nuke leakage scenario’s on that site by the bay for just a few bucks, helps kids more than adults, some kind of salt that floods thyroid so radiation can't do as much damage. never get any if something here melts down or shoots off. I've had some in the freezer for more than a decade.
now 37.5%, change in less then hour, feel like I am in vegas at craps table, ha. fun though.
take care, all this gloating and bragging will bring it to 0 overnight.......ha.
nice call. bombs away this morning on it. getting greedy with the 22.5%% increase in position already, with the internal rallying cry of "remember wnr," ha.
thanks for update.
those zbh 95 puts/leaps starting to pay off on paper with stock at 95.xx and 113 days to go. could all change by days end, but enjoying the show. even the xoma plan with xoma all the way up to .915 and 484 days left is interesting.......no more selling every last share after the wnr experience. ha.
don't know where today will end but the trading account just hit at least two year high, likely wiped out by days end the things have been going. cut oxgi long holding in half yesterday as it was still profitable even after steep drop. buy low........ha.
bw, you can get storage rack, two words, starts with S. ends with Harvest, that can hold a ton of # 10 cans, and the shelves can be adjusted for medium and small cans as well. comes out from wall couple feet, and can put top it for more storage.
we found it really handy and keep it in unused bedroom so only a few house visitors know it's there. We just laugh if off to hurricane preparedness, just like our gov recommends and the strange looks stop, ha.
--- having enough trouble handling the long side of things, lol.
That made me laugh out loud as I feel I have been treading water during a really strong rally the last couple years....
hey gfp, do you know if the "time decay" issue is an issue with the sh fund 1x short you mentioned? I like the low expense ratio, and while 3% isn't 20% like some hedge funds, it's still 3%. I don't paying for performance, but as you know..........ha.
Take Care.
==so there's plenty that could go wrong ==
and has for sure
but that's investing
roll the dice
thanks for heads up, but I am sleeping well and that's my matrix,
no sure thing, down 289 today helped
Thanks for update, I was able to get some under 40, finally, after a year or so or waiting to get more. Then I thought I watched it Tuesday at 37.xx, and then just noticed it back over 40. I had no clue why they had jumped, (for them,) by such a large margin in just a couple days. It is appreciated.
Take Care.
=======the bear ETF has delivered returns of about 2% against 5.8% decline for SPY. ====
minus what your broker will charge your margin account to borrow the units to short......margin rate are what 4-6%, I don't keep up. mine was 8 last time I used it. long time ago.
maybe a nice interest rate rise will trigger a derivitives spin out of control, down we go, something will give eventually, I believe that in all my dna.
====the bear ETF has delivered returns of about 2% against 5.8% decline for SPY. ====
many, many studies done about chasing last years top producers, and then watching them get crushed while everyone piled in, chasing the dragon.
think of all the things folks could have said about how poorly wnr was doing back in the day, given up for dead, or corx, for that matter. wnr was crap by any normal matrix and sent from 4 to 50.
buy low , when no one likes them, sell high, when everyone loves them, do opposite. simple. err, well maybe not.
ha
yea, they play with hdge, like so many others, down big so far today, on 11,000 shares, jeeze, trying to squeeze every scared cat out.
problem with this one is, that then becomes mountain to clime every time they do it, a few sells, then big buys to bring back up to where it was......seen if many times in this one, leaves bad taste in mouth for sure. down much more and i'll be buying again.....
may lighten up some on next downturn in market, but trading account still range bound now for year or two within acceptable sleeping levels, ha
would be nice to have in downturn, and I almost always sell early....and I see way to much debt in the world to be very positive on 1-3 year outlook, and yet they keep printing me wrong, ugg.
====So it's essentially a hedge fund, with all the added risks that entails. ====
and profit possibilities, ha,
never been one for index funds, not much anyway, rather roll the dice,
agreed on the until proven otherwise part 100%
bw, if you are out there and still have any hdge, notice any weird things going into your acct at zero value??????
at least that way I would know where it is coming from, still might be my broker just stuck it in there "by accident" and then reaping fees for removal, times number of "accidents."
like so many movie plots, trust no one, ha
ANI Pharma, Inc.====
did any body else have a weird set of numbers and letters appear in the "current position: portion of their acct's lately?
mine shows 2000 shares of this weird string of letters and numbers with a zero total value attached.
I figured it was some kind of glitch so I didn't worry about it.
after about a week, I called broker, guy said he didn't know what it was and he could transfer me for another long wait, so I passed.
then another couple weeks and I emailed them, their response was that the number was a "placeholder" for this ani pharma inc.
??????? I said I had never heard of them, I didn't buy them, I don't want to be charged to remove it as a dead certificate if I never bought it, so I asked that they tell me if I paid a commission for them, or whatever they could,
called them again, told me the shares went into my account at zero value on 8/21/2015 as the result of a corporate action.
still ????? so I looked up name on yahoo, and it traded 1600 shares yesterday at 54+ per share, so I asked the guy, you mean someone just gave me 108,000 thousand dollars. he just just kept repeating that they were there as the result of a corporate action.
since some of us have some of the same stuff, I was wondering if anyone else is having this experience. I have kind of a huge position in hdge and wondered if it was related to that????
any help appreciated in advance. I've seen plenty of splits, spinoffs, free stock, that kind of thing in my day, but never zero value to a 54 dollar stock that I have no clue where it came from other than some type of corporate action.
running out of days, 122 left, I saw a headline that china's market had its worst two day session in 3 weeks. that would have sunk us just a few weeks ago, now we are Teflon again.....go figure.
looks like someone is trying to time when to get back into zbh for sure as they opened today near 103 in first few minutes, to settle back down to 99.43 even in this up market. seems to being pushed down, the same way it used to be pushed up. wonder if the total of 95 dollar puts that stood at 30 total contracts, where I owned 25 of them, for months, and then mysteriously jumped to over 1500. didn't watch it every day so don't know if they were all purchased at once by one of the biggies now appearing to be holding the price down compared to action just a couple months ago.
maybe I lucked out and got on right ship....that's what investing is like these days. which ever way the most money wants to push it.
zbh is trading at 98.xx, down from high of 121+, 123 left days on 95 dollar put option, closest I've been. ha. might be best 9k mistake I ever made, (from 1k to 10k,) unfortunately I've made plenty in my day, ugg.
please let me know if you go in corx, I think i'll wait for r/s that might be coming....hate to miss out on that money maker, ha.
hope does in fact spring eternal.....unbelievable it's still out there.
take care.
HA, and so it goes.....EOM
thanks for the update on reed, on corx i had about given up after 20 years.
it used to always be that they would come up with another story to get people on board, and it worked for decades.
i don't remember them ever having so many shares authorized in all that time, but they may have and i just didn't notice. i always looked at them as a momentum play. for years it was buy under .50 and sell 1.00 plus. but 1.4 billion shares authorized is not a direction i remember, so i am just a viewer from afar for now.....
i'll post over there if i get in again, i actually had an order in months ago, just as a kick, forget price, maybe .03, but it didn't take whatever it was......just when you thought you were out, they drag you back in, ha.
take care.
I choose third with water tablets just in case.
finally got some reed under 5, just little, waited long time, ha.
looking for a filtration system for salt water pool as we have kinda a big one we refer to as the pool that corx built. ha, the swiss have one but i haven't looked in a while, water has little salt in it compared to ocean.
Junk bond market: Danger ahead
Published: Sept 8, 2015 5:01 a.m. ET
http://www.marketwatch.com/story/junk-bond-market-danger-ahead-2015-09-08
By Brett Arends Columnist
Interest rates are rocketing in the market for higher-risk, higher-yield corporate debt.
Little noticed by the outside world, the effective yield on junk bonds has rocketed by as much as a third over this summer. Investors are panicking and fleeing the loans issued by companies most at risk of bankruptcy.
Such yields can often be a canary in the economic coal mine and warn of trouble ahead. And they are especially intriguing now, as U.S. companies in aggregate have never owed as much as they do currently.
By some math, the scale of this summer’s spike really only make sense if we are heading into a disastrous economic slump comparable to the 2008-9 financial crisis, the early 1990s, or even the Great Depression.
Whether that judgment is correct or not is another matter. But there are plenty of extremely smart people who believe that market prices are highly “informationally efficient,” meaning in layman’s terms that we should pretty much always believe what they say.
“Junk bonds” is the collective term for bonds issued by companies whose credit rating is below investment grade. It covers the gamut from bonds which are unlikely to default all the way to bonds that are basically as speculative as a penny stock. Junk bonds became infamous during the 1980s thanks to the activities of so-called “junk bond king” Michael Milken, who later went to jail for his financial shenanigans.
Thomson Reuters data last week showed that U.S. investors have been withdrawing about half a billion dollars per week from high-yield bond mutual funds recently. It’s no secret why. Global markets have been in a tailspin since China devalued its currency last month, suggesting that the country may be in or near recession.
U.S. corporate debt, from top-rated AAA bonds to those at the bottom of the pile, has never been this high. Despite all the happy talk about solid balance sheets and deleveraging, the Federal Reserve’s most recent data show that U.S. corporations outside the financial sector today owe an aggregate $7.7 trillion. That’s almost 50% more than they owed 10 years ago. Companies borrowed more just in the first quarter of this year than they paid down in all of 2009 and 2010.
Bonds are like seesaws: When the price of a bond falls, the yield rises. Since the start of June the yield on the benchmark junk bond index, the Barclays High-Yield Index, has spiked alarmingly as prices have fallen. In practical terms investors are demanding much higher interest rates to compensate for the risk of lending money to companies with a lot of debt.
Currently the index sports an average yield of 7.2%, according to FactSet. That’s up sharply from 6% at the start of June. Yet over the same period, the bond market has cut its annual inflation expectations for the next seven years by almost half a percentage point.
In other words, at the start of the summer U.S. investors were demanding inflation plus 4.3% a year to lend money to riskier companies. Today they’re demanding inflation plus 5.9% — about a third more.
Research has shown that over the long term, going back at least to the 1960s, high-yield bonds in general have tended to produce annualized returns of about 4% a year above inflation. Investors now are apparently so nervous they are requiring a real interest rate that is about 50% greater than the average.
This can’t be because they are afraid of inflation: As noted, inflation expectations have tumbled, and Treasury bond yields have fallen. So it must be a surging fear that the economy is going to see a wave of defaults.
Right now, a seven-year Treasury bond offers a “risk-free” yield of 1.9%. Today’s junk bond prices only make sense in comparison if investors expect loss rates to average about 5 cents on the dollar for the next seven years –—meaning lenders will end up getting back only 70% of their principal.
To put that in context, according to research by Vanguard and Moody’s the loss rates on junk bonds have spiked above 5% during brief, disastrous periods in the past — such as the depth of the 1930s Great Depression, and the worst years of post-war recessions.
So you can take this current condition as an economic warning by an efficient market, or a buying opportunity in an inefficient one.
In general, junk bonds are not as toxic an asset class as the name implies. There are some powerful arguments that we should all have some of our retirement portfolio in a high-yield bond fund — not least because they frequently zig when everything else zags. There are plenty of high-yield bond mutual funds and exchange-traded funds available to the ordinary investor. Vanguard offers its High-Yield Corporate Fund VWEHX, +0.00% and among ETFs, the SPDR Barclays High Yield Bond ETF JNK, +0.03% recently yielded 6.6% after expenses of 0.4% a year.
Anyone investing in a high-yield corporate bond fund should hold it where possible in a tax-sheltered account such as an IRA because the interest, unlike stock dividends, is taxed fully as ordinary income.
Doom and gloom or buying opportunity? Time will tell.
ZoWie, I used to shoot/have one of those as a kid, haven't seen one for years. as a side now, one of the fox shows, said that 1.6 MILLION fed apps for guns where sent in this past Aug., Setting an all time record since they began in the 80" or 90'S.
Guess folks figuring they might just have to put down the selfie stick and defend their own shores/homes/businesses from china ships in our waters, or Russian war ships just off our coast, means they might want a back up plan, ha.
remember driving down the old A-10 runway on the myrtle beach air force base after it closed and seeing how they could back up those planes on very short paved V's just off the main runways. sure was nice knowing they were here to protect out shore with their urainium depleting rounds that would go through ships, tanks, and the like, cockpit was all encased in a titanium shell for the pilots to give them a chance.
used to run the beach at dawn and have a couple of those things on a mission coming toward me and would about crap my pants as they went 100 feet over head.
===History is not a bedtime story about bunnies and kittens.===
more like mad max lately.
walls everywhere, today police hitting, tear gassing, beating, refugees that had been held up for days in squalor. the level playing field might just end up being the one where no one has anything......
That is certainly one way to do it, but just a heads up that since the brokers are letting you "borrow" the contracts, they may start, at moment one, charging you margin interest costs for the :loan: investment. these can go 6-8% pretty much wherever they want to set the price for margin rates, meaning your timing has to pretty spot on to climb that hill.
Not positive that is how they do it because I don't do it enough, or with enough funds to look it up on my statements to see if it is being charged, but bells are going off in my head that they might. likely just worn out ears, ha.
etf's avoid that, if that is in fact the case.
good luck.
bw, leaps, like options, get a little confusing, and you don't want to mix them up, so i would check against a brokers site before placing trade.
i think of leaps as anything with time decay of a year or longer, but the actual definition might be less then that. I currently hold some 95 dollar leaps on zbh, formally zmh, that were good for around 350 days when i got them. the stock traded up to 120 and i wouldn't sell, as I got them thinking that as the market fell, so would zbh. Actually it has been a decent company, I just thought it was getting over priced. My strike price is 95 dollars and have about 130 days left, with the price ever closer at around 101. my cost was 4 dollars each, so the price has to fall all the way to 91 for me to be "in the" money. but that really only comes into play on the last day as folks will pay up or down for them every day until expiration. I bought puts, like shorting, i was hoping for a big price drop, which the stock has a history of ups and downs and i have been writing about it here for years as it might make a good leap play, so i tried it. The most I can lose is what I paid for them. I was actually up a bit last week for a little while during a big downturn and someone else was willing to pay a bit over 4 each for them. If I had bought calls, I would have wanted to price to rise, like buying shares, only never really owning them, just the right to buy them for the strike price any time during the 350 days or so.
I also own some XOMA calls with a 1 dollar strike price with over 500 days to go, those are true leaps for sure. bought with like 525+ days left to expiration. didn't cost much as xoma was trading at .73 at the time. Each option gives you control of 100 shares, so I control thousands of shares for a long time in a yo yo bio, for not much money.
so buy puts = hope price falls = most you can lose is what you paid.
if you buy call = hope price rises = most you can lose is what you put in if stocks stays even or goes down.
but either one you can lose 100% without much trouble, so heads up.
These two are universally considered the "safe" type options, or leaps, you really can't lose any more than you put in.
When you SELL a put or call, the game changes entirely, and if the market/stock moves against you, you in theroy could lose to infinity and get non stop margin calls.
About the only good time to sell a call is if you actually own the underlying stock. this is generally considered a safe option as the worst that happens to you is the shares all get called away from you and you lose them, but get to keep the buy out money plus the premium you got when you actually sold the calls. Some folks write, or sell, calls on big pharma, slow moving, tight range, think bmy during the 2000 to 2013 years, and will continually write calls with a 3 or maybe 6 month expiration dates, and as the stock did not move enough, the writer got to keep the premium paid by the call buyer. so if bmy was paying you 5% in 2000 and you wrote successful calls using those shares for 3 month periods, for 13 years, and they never got the stock called away, you would have gotten your 5% div plus maybe and extra 1-3% each quarter from the premium paid to you by the person hoping they would move in their direction. which is exactly what a lot of retired, stock sauvy investors did. key is to find one that didn't move much so you keep your shares and collect premium and boost yield while keeping shares.
most advise to NEVER SELL NAKED PUT OR CALL, this is where you do not own the underlying stock and your loses could go to infinity if market/stocks move away from you and you don't cover. (laid up in hospital, ect.) my thinking is if I hear of someone writing thousands of naked puts or calls, they are gs, jpm, bac, fed., or forigien country fed, or one of the big ones and can keep buying/selling the actual shares until the day traders jump in and keep it going and these rarely fail as they have so much money behind them. of course this would be illegal on many levels and could never happen yet seems to over and over again, just ask the nygerian brothers (twins sp?)on cnbc. they just wrote book on it and started and sold for a ton, the site, "options monster."
hope the helps.
I bet you sighed some relief at those pages.
think they are still talking about letting mm's "float, meaning the only place I can figure you will still be able to get back 1 for 1 would be the first 250k at each different bank. one bank only will just add up all your deposits and cover you for 250k max.
used to be that stocks and bonds were valuded at the dod or exactly 6 months after, for estate purposes. I don't know what happens to capital gains if the stocks/bonds are mearly transferred into decendents hands. taxes on gains/losses are always a big deal when selling. worth paying few hundred to lawyer to find out your states laws, then there are fed laws, irs laws, muni laws maybe, ect. at one point they got up to 5 million before the up 55% or so estate taxes kicked in, but I think those were allowed to expire, back to only 1 million, but not sure what it is now, or is going in the future, typically dems want their hands on that money and vote to tax a person after death to the max 55% at as low a number as possible. why leave it to someone ealse who might start a business with it and hire some people, they think they can spend it wiser, waving their magic wand, and include 5 more million voters to their ranks.
socaialism works great until you run out of other peoples money to take,
sorry for rant, hard to get buy and holder to change mind,
bw is much more informed on short etf's than I, for sure
I am, and have been, growing short for last few years, now maybe 80-90% rough guess, including options, minus cash still in trading port. would not be so aggressive were it not that every 15-20 years our funds are replaceable, (timber)
any luck with the full service broker pie chart retirement circles, advising where to put where, based on age? curious what they are saying these days......
take care
and all with the backdrop of china ships in usa waters in alaska, and a cable cutting russian warship 300 miles off the usa ga. coast, just a coincidence that's where our nuke subs on the east coast get their instructions, yikes to holy hell.