Im on the other side of this, own over 100 contracts of 300 puts since the ER for next friday on nvda. Was down a lot until today, but decided to hold on and took a big gamble. I have a feeling Trump is going to really ramp things up with China now.

I wouldn't be surprised if we see a big move in REGN in the next month or so. MRNA rallied bigly from dumb money piling in on some highly suspect vaccine data. REGN's antibody treatment will probably actually work, and there should be lots of of bullish announcements in the next month - 6 weeks.

I mistakenly sold it at $600 and bought back in

Thanks for posting about LVGO, I've been keeping an eye on it ever since you posted about it. Are you still holding it, or just biding your time?

No, I'm actually ******ed and didn't realize it dipped into the 600s today

$680~

I bought some DKNG at IPO based on some recommendations here. And obviously it has worked out. Anyone have any ideas whether now would be a good time to take profits and get out vs letting it ride?

You can always roll diagonally for a credit. For example, I wrote 5/29 3010C last week for ~15 pts, and rolled it to 6/5 3040C for a 2pt credit. I allow myself to net 32 extra points if the rally continues into next week in addition to the original credit.

I don't cover the entire position though. Only half to two-thirds.

I assume you are interested in selling because you don’t want to lose a profit on the trade. IMO a lot of these companies that are leaders get pumped up valuations because investors believe they can use their stock to buy up competitors, smaller companies that enhance their business model, etc. This one I would guess is a long term investment that will be volatile in price. I would guess that you will see some great rallies and some gut wrenching sell offs. I’d vote to hang with it over a long holding period.

So I went long HII at 176.37 on 5-12 and today it is 205.92, so value investing still works, r-right guys? Don't follow the crowd, don't pile into DKNG. I got another deep value pick, this one poached from a hedge fund value guy that has half his Q2 portfolio in it, CRTO. It has a ROE/PB of 14.78 (very high that's good) and a market cap/revenue of 0.27 (very low and that's a good thing!)

What is the best value for 300 spy puts? I bought a month out for $8 - june 30

Correct me if I’m wrong: It seems your target in your shorts are day trade/short term support levels.

In this type of market, it doesn’t make any sense to me. You are constantly fighting against the trend, one that is clearly very strong.

If you decided to short based on fundamental levels and hold through all the volatility expecting a large move down, I’d disagree but i could understand it. (A lot of heros have died in this market)

But you aren’t even going to take advantage of a large drop given your targets, so how do you plan on doing anything other than slowly losing money? Were you scalping long on the way up at all?

constant scalping shorts in this market just seems -EV unless you are jim simons.

I think Tom was short ~2950. I can understand that short as it appeared the market was ranging. I can also understand a 3040 short if you believe it's too soon for 3100. Maybe writing a 3050C or 3100C is better?

But yes, it's not a long run strategy. Too many upside surprises (more early stage vaccine news, looming stimulus), and muted downside reaction to China. And with the 10yr yield under 1% (current 0.68%), the market has no choice but to pay up for a higher mult in the medium term, unless you're betting on a 2nd wave. In short, don't be like Tooth (RIP).

I have a stimulus FOMO, so I'm bullish until stimulus or 3075.

Funny thought. Bears have to tried undermine this rally from day 1 with "bear market rally", "pension rebalancing", "Great Depression unemployment", and recently "retail rally", and yet these same bears say stuff like "the market is disconnected from reality". Ok...

I think all they can see is VIRUS SELL! Instead of looking at all of that stimulus/liquidity which is going to be very hard to just take away even when things get better.

So you believe the market is over, fairly or under valued based on fundamentals?

I'm not bothered at all b/c "too many upside suprises" or "market has no choice but to go up." It's fine to be bearish, I just don't understand how his strategy makes sense.

If he has a real bear thesis - he's limited his upside with his price targets.
If he is playing with momentum/TA - he has it backwards. Should be focusing on BTD at support instead of shorting at resistence given the trend.

Sounds like the second one, and he is just going to slowly bleed money and not capitalize on potential large market drops.

Still obsessed even when I take a break. Just amazing. There's a thread for your mental illness now. Please try and keep this thread professional, thanks.

And I've liked long since 2950 (since 2770 really, bar a few percent around 2900). The data shows there's been a huge retail pile in. So if you're saying don't be like me, are you now a bear?

There's always something to the yield arguments (until bonds get out of control at least - see late 2018), but I don't think it's a trump card. It wasn't before corona and it isn't now. It's merely a factor.
To "undermine this rally"? What does that even mean? We're trying to understand the factors that have caused it, given that it's irrational considering where the world economy and hence corporate profits are going.

And yes it's entirely a retail rally. 68% of fund managers believe that this is a bear market rally, and only 10% think this is a new bull market (from the 2200 lows). Those are incredibly low numbers because these people are a lot more knowledgeable about the economy and how it works than retail. It's only the hordes of retails stuck at home and piling in which are bullish. Truly unbelievable numbers of people are buying in here.

Yet people know how economies work are hugely bearish for the longer term. You were bullish before corona, bullish during corona, and bullish after corona. You're a typical retail permabull -shocked when it goes down ("what's going on???") and world-destroyer confident when it goes up. Nothing wrong with that - it's good to see your posts as an indicator of low knowledge casual retail sentiment - but the professionals don't share your views.

I don't buy the narrative that stimulus is enough to keep the market up through the economic destruction. Stimulus news will boost sentiment short term, and it has (Europe yesterday for example), and it's a good reason to stay long until something changes, but the "stimulus trumps all" people had the same argument pre-corona as it stuck at all time highs with an obvious (to me/most of 2p2) pandemic incoming with its economic effects, and they were very wrong.

From the trade side it's pretty easy if you're like 68% of fund managers and looking to get longer term short - just sit and wait for the right time to come. I'm not a fan of getting in short at anywhere other than obvious inflection points.

Recommended reading:
Galbraith, John Kenneth. “The Great Crash of 1929” (published 1955, recommended by Warren Buffett recently)

It is an economic history of the lead-up to the Wall Street Crash of 1929. The book argues that the 1929 stock market crash was precipitated by rampant speculation in the stock market, that the common denominator of all speculative episodes is the belief of participants that they can become rich without work and that the tendency towards recurrent speculative orgy serves no useful purpose, but rather is deeply damaging to an economy.

I look at it this way. Bluto is the Virus and Popeye is the Market. But Popeye has the Fed in his corner who keeps feeding him spinach. In that scenario Popeye never loses. At least not until Bluto is gone and Popeye suffers a spinach overdose and that is real tricky to time correctly.

Yeah, it's definitely worth reading a lot about 1929 if you're a trader. There was a massive +50% 5 month rally off lows in 1929 as the early bubble optimism continued, "buy the dip"/permabull retails piled in with everything they had, before the economic destruction started to propagate and the economic hit came to roost in corporate profits. There was no fed then but we rallied 50% off lows for 5 months as retail was in deep denial. There was similar denial in the last two recessions (2000 and 2008).

The yield chasing/fed funds rate argument that grim is putting forward is ridiculous. This is the last two recessions with 50% peak to trough lows:



The ultra low/zero rates/rate cutting didn't save jack. It's all about the corporate profits.

There are only two outs if you're a mid to long term bull - massive ongoing fiscal stimulus for years (essentially major inflation) and the fed spending trillions to nationalize corporate debt losses and never taking it back off the books (they say they will in September). Who knows what governments will do and what the odds of those are, but they're your only long outs here given the economic reality which is brewing. Systemic shock like this, especially when adrenaline is administered, always goes the same way in all complex ecologies:

Step 1: An unexpected shock. Major structural amage happens while old function appears retained for the moment (the system has some spare capacity and damaged or weak parts have yet to die/become non-functioning)
Step 2: Stimulus to keep things alive/bullishness that "hey, it's not that bad"
Step 3: The reckoning as the damage from (1) leads to mass node deaths and path friction which requires major reorganization and healing.

We're current in Step 2.

Long aaxn.

Well, I am skeptical that professional sports are going to come back as quickly and smoothly as everyone is predicting. My understanding is baseball is having some major issues over salary negotiations, and I could see this being a big issue for all the major sports moving forward. Not to mention what would happen if/when there is another spike in cases or players start testing positive in season.

Seems like any/all of these things could tank the stock temporarily. But I admit I am pretty clueless about these things, as evidenced in all the $$ I lost in April betting against the stock market rallying to almost all time highs.

I actually bought more yesterday. Massive TAM, high growth, founder led (ceo is from CERN but founder is executive chairman and still active in running of the company). It might not work out, but at the same time it could be a 5-10x over the next ~5 years, so I like getting into names like this.

You're making a lot of assumptions.