Toggle sidebar

OT: Stock and Investment Thread

R

RUDead

All-Conference
Sep 20, 2017
3,655
3,840
0

Knock On Wood: Blackstone, Balyasny And About Ten Other Managers Bought ARKK Puts In Q1​

If you had a sneaking suspicion that Wall Street was starting to bet against the "untouchable" Cathie Wood, as we did over the last couple months, you were right.

Today it was revealed that "about two dozen investment advisers" that included Balyasny Asset Management and a unit of Blackstone bought put options on ARK's Innovation ETF during the first quarter. Blackstone bought puts on 1.3 million ARKK shares and Balyasny acquired puts on 436,500 shares.

The managers saw Wood's fund as a "alternative to buffer against a slump in stocks that surged during the pandemic," that buying puts on an index, the report said. In other words, the asset managers were so confident in Wood's ability to handpick stocks that would lose value during a pull back, they took the inverse of her "expertise" instead of just getting short a tech or small cap index (or both).

And so far, that strategy likely provided outsized returns as a hedge: ARKK is down about 30% from its highs, while the QQQ ETF is down just about 0.7% from its February peak.

 
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
T2Kplus20 said:
A house divided against itself cannot stand.
Click to expand...
If you think the midwest won't go EV, while there also being a clear and growing market for EV's then why can't F do both in the short and medium term?

I actually think F hedging that bet and only going 40% EV by 2030 was a better call then GM saying they will be full EV by 2035. Why box your self in like that? Keep your options open.
 
R

rurahrah000

All-Conference
Aug 21, 2010
3,247
2,200
88
patk89 said:
I rarely utilize options but have had some shares called away when the price jumped more than I expected. Remember, the premium you get paid to sell an option to someone else is based on the strike price and the length of time that the option is effective. I sold them at price well above the current stock price, good for 6 months, and rec'd the premium. But, shares outperformed my expectations, and I gave away the upside. As always, no free lunch.
Click to expand...
Good point. Writing covered call options can be used as a form of dividend but the risk is losing your stock
 
  • Like
Reactions: patk89
T2Kplus20

T2Kplus20

Heisman
May 1, 2007
31,210
19,222
113
RU-05 said:
If you think the midwest won't go EV, while there also being a clear and growing market for EV's then why can't F do both in the short and medium term?

I actually think F hedging that bet and only going 40% EV by 2030 was a better call then GM saying they will be full EV by 2035. Why box your self in like that? Keep your options open.
Click to expand...
I'm just saying that it will be very difficult for a company to do both well. EV and ICE are vastly different productions and challenges to deal with. Trying to do both will hurt financially.
 
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
RUDead said:

Knock On Wood: Blackstone, Balyasny And About Ten Other Managers Bought ARKK Puts In Q1​



The managers saw Wood's fund as a "alternative to buffer against a slump in stocks that surged during the pandemic," that buying puts on an index, the report said. In other words, the asset managers were so confident in Wood's ability to handpick stocks that would lose value during a pull back, they took the inverse of her "expertise" instead of just getting short a tech or small cap index (or both).



Click to expand...
That's a poor take imo. What they did was put a bet against the type of stocks Wood picks, IE hyper growth tech, not against her expertise.

Perhaps Wood should change philosophies given the type of stocks she picked needed a serious correction, but right or wrong she is sticking to her guns.
 
Last edited:
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
T2Kplus20 said:
I'm just saying that it will be very difficult for a company to do both well. EV and ICE are vastly different productions and challenges to deal with. Trying to do both will hurt financially.
Click to expand...
meh, the auto industry has long built different models in different factories. So that will continue, just certain factories will be EV while others will be ICE. And cars have become more and more electronic over the years, this is a more drastic change for sure, but they are pretty competent in terms of car electronics.

Ford is also benefitting from what looks like finally hiring a competent CEO in Farley.
 
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
rurahrah000 said:
Good point. Writing covered call options can be used as a form of dividend but the risk is losing your stock
Click to expand...
I asked above, but uncovered would be if you don't own the stock, and if the option is picked up, you would have to buy at market in order to cover?

And uncovered is the same as naked?
 
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
I did go to youtube and there were some 3 hr long options tutorials which I wasn't ready to invest time in.

I instead watched a 20 minute version, and didn't come away with much, so still not partaking.
 
Last edited:
P

phs73rc77gsm83

All-Conference
Aug 11, 2011
3,060
3,858
83
mdk01 said:
As I said earlier Schwab wouldn't let me. But again tell me if I'm wrong. Sell the option and get $700. As unlikely as it seems, between now and June 11 GME goes from 240 to 360. The option at 350 gets called. I have to essentially buy 100 shares at 360 to meet the call. I receive 350 in proceeds, $1000 less than I paid for the stock . I received $700 when I sold the option, so I'm down net $300. And if it had gone to to 370 I'd have been down $1,300.

Am I right?
Click to expand...
Yes, but don’t forget you may not be able to buy the shares in the market at 360 (think of RUrara’s example of it going to 1000. Is that likely, probably not; but is it worth the risk, not for me.
 
P

phs73rc77gsm83

All-Conference
Aug 11, 2011
3,060
3,858
83
patk89 said:
I rarely utilize options but have had some shares called away when the price jumped more than I expected. Remember, the premium you get paid to sell an option to someone else is based on the strike price and the length of time that the option is effective. I sold them at price well above the current stock price, good for 6 months, and rec'd the premium. But, shares outperformed my expectations, and I gave away the upside. As always, no free lunch.
Click to expand...
Absolutely. I’ve been DIY for decades but back in the late ‘80s or early ‘90s I had very small positions in Microsoft and Amgen. My broker at the time was trying to convince me to sell covered calls with the thinking that I could make a few bucks and I could just sell my shares to cover if need be. I didn’t, thankfully, because I was very bullish on both and made significant profits over the decades. Could I have sold to cover then take a new position? Sure but if I like the company I don’t want to sell. I am a very infrequent trader, more buy and hold investor unless I see something fundamentally changes. That’s just me, though. To each his own.
 
  • Like
Reactions: patk89, WhichReligionIsRight and RU05
M

mdk02

Heisman
Aug 18, 2011
26,464
18,764
113
phs73rc77gsm83 said:
Yes, but don’t forget you may not be able to buy the shares in the market at 360 (think of RUrara’s example of it going to 1000. Is that likely, probably not; but is it worth the risk, not for me.
Click to expand...

In 15 days? Remember, the exposure ends in 15 days. Probably not? I'd say the chances of 1000 would have been equal to my chances of winning the top prize in MegaMillions. This isn't RUJohnny99s example what I called a pig getting slaughtered.
 
P

phs73rc77gsm83

All-Conference
Aug 11, 2011
3,060
3,858
83
mdk01 said:
In 15 days? Remember, the exposure ends in 15 days. Probably not? I'd say the chances of 1000 would have been equal to my chances of winning the top prize in MegaMillions. This isn't RUJohnny99s example what I called a pig getting slaughtered.
Click to expand...
I’m talking about the concept and structure of naked calls more than about any specific situation. There are many relatively new investors on this thread (and other investment forums for that matter) and my intent in posting was to help convey the risks if someone is unaware. There are many instances of what I would call inappropriate risk taking (at least for some individuals) such as not understanding options, margin requirements, etc. I’m not trying to talk anyone into doing or not doing anything.
 
  • Like
Reactions: RU05
R

RUJohnny99

All-American
Nov 7, 2003
64,666
5,961
113
mdk01 said:
In 15 days? Remember, the exposure ends in 15 days. Probably not? I'd say the chances of 1000 would have been equal to my chances of winning the top prize in MegaMillions. This isn't RUJohnny99s example what I called a pig getting slaughtered.
Click to expand...
You keep bringing up the 15 days as if it makes you immune from loss. The risk of loss is greater than zero, and significantly greater than the risk of getting all numbers in the Megamillions jackpot.

naked options work verrrry well. Until they don't.
 
  • Like
Reactions: phs73rc77gsm83
R

RUDead

All-Conference
Sep 20, 2017
3,655
3,840
0
RU-05 said:
That's a poor take imo. What they did was put a bet against the type of stocks Wood picks, IE hyper growth tech, not against her expertise.

Perhaps Wood should change philosophies given the type of stocks she picked needed a serious correction, but right or wrong she is sticking to her guns.
Click to expand...

They could have just as easily shorted the stocks, so I think they probably just thought the fund would go down more than the stocks themselves because of they way it had been trading.

Zerohedge has some great info, but their analysis can sometimes be lacking or too dramatic imo.
 
R

RU05

All-American
Jun 25, 2015
14,651
9,158
113
Heavy call options on F, which may suggest WSB looking to push F higher?

I'm willing to ride that wave.
 
P

patk89

All-Conference
Jul 25, 2001
6,304
2,428
78
RU-05 said:
And you would need to hold 100 shares for each contract for it to be covered? At least partially?
Click to expand...
I was doing this to generate some yield, in addition to any dividend, while still owning the stock so never went naked, always covered. If the underlying stock went up slow and steady, I keep the upside, get paid a premium to sell the call option, and continued to receive the dividend. Problem was positive news, stock jumped above the strike price, and my shares were called away. The buyer of the call options loss was limited to the price he paid for it. And he gets the upside if things spike within the defined time period. I've hit on a couple of Apple call options over the years and the total return given the relatively small option premium paid was outstanding. But hitting requires a good bit of luck. You can be right that a stock is undervalued, but be wrong about the time frame and end up out of the money.
 
Last edited:
  • Like
Reactions: RU05
J

Jtung230

Heisman
Jun 30, 2005
19,096
12,254
82
BellyFullOfWhiteDogCrap said:
Production should start late this year or early next. Factory still under construction + lots of other variables (new battery cells, supply chain issues, new manufacturing tech). So, we'll see about that timeline.

They just recently crossed over 1 million pre-orders. Apparently, there was a big surge of orders following the Ford Lightning reveal.
Click to expand...
You already conceding that they can’t deliver in 2021? Just another over promise by Musk. GM can have 1mm orders for the hummer if they keep taking reservations. But unlike Tesla, they don’t over promise and just say the reservation is full.
 
W

WhichReligionIsRight

Heisman
Oct 19, 2010
207,472
28,752
0
jtung230 said:
You already conceding that they can’t deliver in 2021? Just another over promise by Musk. GM can have 1mm orders for the hummer if they keep taking reservations. But unlike Tesla, they don’t over promise and just say the reservation is full.
Click to expand...

Telsa has sold 200,000 powerwalls already and has a multiquarter backlog. They also have new car plants opening in Austin and Berlin this year. Tesla will be fine.


 
  • Like
Reactions: T2Kplus20
J

Jtung230

Heisman
Jun 30, 2005
19,096
12,254
82
  • Like
Reactions: RUJohnny99
T2Kplus20

T2Kplus20

Heisman
May 1, 2007
31,210
19,222
113
RU-05 said:
She's saying exactly what Powell has been saying for months.
Click to expand...
Bingo! She is echoing Powell and also saying that deflation is coming due to productivity gains via innovation. Both have been saying the same thing for a long time.
 
B

BellyFullOfWhiteDogCrap

All-American
Dec 4, 2010
5,866
5,256
0
jtung230 said:
You already conceding that they can’t deliver in 2021? Just another over promise by Musk. GM can have 1mm orders for the hummer if they keep taking reservations. But unlike Tesla, they don’t over promise and just say the reservation is full.
Click to expand...
I'm not conceding that at all. Just saying there's a bunch of "never before" stuff going on.
5 years from now, will I care that Cybertruck was delayed a few months?
Your GM hypothesis is cute. GM promised 30 EV models by 2025. How's that for over promising? Maybe they really have 50 models in the pipeline.
 
J

Jtung230

Heisman
Jun 30, 2005
19,096
12,254
82
BellyFullOfWhiteDogCrap said:
What would Elon do if all regulatory credits disappeared tomorrow?
Click to expand...
That’s the $600 billion dollar question. He also committed to not selling anymore BTC. Let’s see if he can pull another rabbit out of the hat.

GM had 10k reservations in 10 min for the EV Hummer. If they just keep taking the reservations, I’m sure they can get to 1mm much faster than Cybertruck.
 
T2Kplus20

T2Kplus20

Heisman
May 1, 2007
31,210
19,222
113
jtung230 said:
That’s the $600 billion dollar question. He also committed to not selling anymore BTC. Let’s see if he can pull another rabbit out of the hat.

GM had 10k reservations in 10 min for the EV Hummer. If they just keep taking the reservations, I’m sure they can get to 1mm much faster than Cybertruck.
Click to expand...
^^^ LOL! Funny stuff.
 
R

rutgersguy1_rivals

Heisman
Dec 17, 2008
45,214
16,774
0
RU-05 said:
F still climbing.

And GE right there with it.

Cramer had a little bit last year when these guys were around $7 or $8, F vs GE with a finish line at $10. And they have traded very closely ever since. F up 6.87% today, GE up 6,53%. Ford currently at $14.85, GE at $14.27.
Click to expand...
News out yesterday on Airbus increasing production, so that probably kind of buoyed both Boeing and GE yesterday. I mentioned awhile back when it was single digits that low double digits was fairly possible with the moves Culp was making but to really break out from that low double digits would take a recovery of aviation. It's been meandering for a bit in that low double digit area but any news like yesterday with regards to a normalcy in air travel will help boost the stock over time to the upper teens and eventually beyond barring any exogenous shock. News like the construction of wind farms off the coast of the UK and the west coast of the US doesn't hurt with regards to the long term health of the company either.
 
  • Like
Reactions: RU05
R

RUAldo

All-Conference
Sep 11, 2008
4,658
3,326
113
T2Kplus20 said:
^^^ LOL! Funny stuff.
Click to expand...
Jtung230: Like I’ve said before "bees don't waste their time explaining to flies that honey is better than ****." You and I are wasting our time. Let T2kplus20 piss away his money. These Tesla homers don’t understand this isn’t a debate about Tesla the company. It’s a debate about Tesla the investment. I’m sure there is an entry point that you would start a position. If the stock came back to reality I’d jump all over it. When the stock was at $900 p/sh the usual suspects were screaming “buy, buy, buy” - we’ll anyone that listened got crushed. The stock may reach $900 again one day but any idiot knows you don’t buy at all time highs. It won’t be long before Musk proves whether he is a genius or a fraud.
 
B

BellyFullOfWhiteDogCrap

All-American
Dec 4, 2010
5,866
5,256
0
jtung230 said:
That’s the $600 billion dollar question. He also committed to not selling anymore BTC. Let’s see if he can pull another rabbit out of the hat.

GM had 10k reservations in 10 min for the EV Hummer. If they just keep taking the reservations, I’m sure they can get to 1mm much faster than Cybertruck.
Click to expand...
Don't dodge the question. There's a fairly obvious answer. Give it a shot.

And your off about the pre-order #s. CT was still way ahead of the Lightning after a 2 day comparison. And as I stated before, there was a surge in CT orders after the Lightning was revealed. I guess there was a bunch of people waiting on the Lightning reveal before making a decision. When you compare specs and value there's an obvious winner. That said, I'm sure Ford will sell every Lightning they make. They're just not going to be able to make that many compared to Tesla's CT.
 
  • Like
Reactions: T2Kplus20
T2Kplus20

T2Kplus20

Heisman
May 1, 2007
31,210
19,222
113
BellyFullOfWhiteDogCrap said:
Don't dodge the question. There's a fairly obvious answer. Give it a shot.

And your off about the pre-order #s. CT was still way ahead of the Lightning after a 2 day comparison. And as I stated before, there was a surge in CT orders after the Lightning was revealed. I guess there was a bunch of people waiting on the Lightning reveal before making a decision. When you compare specs and value there's an obvious winner. That said, I'm sure Ford will sell every Lightning they make. They're just not going to be able to make that many compared to Tesla's CT.
Click to expand...
And Ford will likely lose a ton of money on each Lightning sold.
 
  • Like
Reactions: BellyFullOfWhiteDogCrap
You must log in or register to reply here.
Top Bottom