Investing General Discussion

Tmac said:

You the product designer?

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I make memes using MS Paint and I can’t code, so…

All jokes aside I consulted for them on the product management side in the early days.

Wrote the $28.5 strike covered calls on the INTC shares I just bought. Jan expiry. 24 cent premium. This is pretty much the definition of a "buy/write". Usually you might do the write immediately but I waited a day.

Bought at $25.50
Strike at $28.50
Time to expiry 30 days
Premium at $0.24

So scenario #1 - I get assigned and lose my shares. $2 profit from the share appreciation plus 0.24 premium. I wont get a dividend capture so $2.24 profit in 30 days. 8.8% or 105% annualized.
Scenario two - I dont get assigned and I pocket the 24 cents at roughly 0.94% profit or 11% annualized. If the stock circles back lower then I will most likely be able to close out my calls early for a couple of pennies and start again. If i make it into Feb with these shares I will capture the 37 cent dividend.

According to a 2-year backtest I have a 16.9% chance of being assigned.

Gutterflesh said:

I make memes using MS Paint and I can’t code, so…

All jokes aside I consulted for them on the product management side in the early days.

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Cool! I did the same w RocketMortgage before starting my own business.

Mist said:

The big question for me is whether I should frontload my 401k contributions next year. I have plenty of cash to max out my ROTH and HSA immediately and still put 50%+ of my pay into my 401k for the first few months of the year.

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50% chance it will 100% be the right thing to do.

Why max 401k? Does your business not match? You give up free matching money if you do that at my job, as matching stops once you max.

Roth I’ll max day one like always.

Furry said:

Why max 401k? Does your business not match? You give up free matching money if you do that at my job, as matching stops once you max.

Roth I’ll max day one like always.

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Maxing 401k is always the answer. It doesn't matter that you surpass the company match, you tax shelter that 20k (or more if you are old like me).

Sanrith Descartes said:

Maxing 401k is always the answer. It doesn't matter that you surpass the company match, you tax shelter that 20k (or more if you are old like me).

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I always max it, but over the course of the year. If you max it in three months, you are tossing 9 months of matching funds in the trash, which is next level tarded.

Furry said:

I always max it, but over the course of the year. If you max it in three months, you are tossing 9 months of matching funds in the trash, which is next level tarded.

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I am guessing the idea is to take advantage of the market weakness we now have and not chance a recovery later in the year.

Mist said:

They're supposed to true-up after the end of the year if they under-contributed.

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Yeah they have to match but they can choose when to do it.

Captain Suave said:

One nice thing about being self-employed is I can put away 100% up to the 401k max and then match myself 25% off the top after that up to $66k. Obviously I need the raw income to do that, but if it's a good year I get to stuff a lot away tax-free.

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Using a SEP?