Investing General Discussion

TJT

TJT

Mr. Poopybutthole
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LachiusTZ said:
Handling the costs isn't bad if you aren't leveraged to fuck and back.

My father in law ate shit due to being over leveraged back in 2012? so that lesson is clear in my mind.

Buying a few houses after a market crash is still a plan I have.

Might regret it when BTC hits infinity but whatever
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I would argue that even if most could handle the cost of not having a tenant for a time. None full-time landlord can handle a year or more of no income.
 
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Rangoth

Rangoth

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Fogel said:
Also, you mention people executing options early. While possible, almost nobody does it. At least it hasn't happened to any of us lately.
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Can only the buyer chose to execute early? Otherwise I think I am missing something....

For instance, I saw a stock currently trading at 19.93$ with a sell put months out for 17.50$ w/premium of 4.10$. This means someone will pay me 4.10$x100 for me to be required to purchase the stock at 17.50$ at that date which is months out. What would be to stop me from taking the free 4.10$ and then immediately executing the option also buying the shares at what is essentially 2.50$ below current market rate?

So I'm guessing only buyers can choose to execute early?
 
Fogel

Fogel

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Rangoth said:
Can only the buyer chose to execute early? Otherwise I think I am missing something....

For instance, I saw a stock currently trading at 19.93$ with a sell put months out for 17.50$ w/premium of 4.10$. This means someone will pay me 4.10$x100 for me to be required to purchase the stock at 17.50$ at that date which is months out. What would be to stop me from taking the free 4.10$ and then immediately executing the option also buying the shares at what is essentially 2.50$ below current market rate?

So I'm guessing only buyers can choose to execute early?
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Correct, option sellers cannot exercise early, only buyers. But like I said, it almost never happens. Most options are bought and sold before they're assigned or expire.
 
Sanrith Descartes

Sanrith Descartes

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Rangoth said:
Can only the buyer chose to execute early? Otherwise I think I am missing something....

For instance, I saw a stock currently trading at 19.93$ with a sell put months out for 17.50$ w/premium of 4.10$. This means someone will pay me 4.10$x100 for me to be required to purchase the stock at 17.50$ at that date which is months out. What would be to stop me from taking the free 4.10$ and then immediately executing the option also buying the shares at what is essentially 2.50$ below current market rate?

So I'm guessing only buyers can choose to execute early?
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Read about American versus European style options. Most stocks actually trade European style. As Fogel said, most people dont actually want the stock they want to trade the premium.
 
Araysar

Loser Araysar

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Sanrith Descartes said:
I prefer a balanced portfolio. $6.87 EPS and a dividend yield of 3.45% in the consumer staples sector. I will leave the penny stocks to you.
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i, too, like balancing well performing stocks with bad ones.

its really why i buy the penny stock once in a while
 
Aychamo BanBan

Aychamo BanBan

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Gravel said:
Yeah, I strongly considered it as the returns on it seemed to be really strong over the last decade. I was always a bit hesitant though as I heard horror stories about bad tenants (and the answer was always to vet them strongly!).

I don't have to fuck around with that with equities. My laziness in not wanting to manage that really saved me a ton. Real estate is a train wreck waiting to happen.
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I whole heartedly agree on residential real estate as investment. Once a year I'll get interested in rental properties, and go start reading on bigger pockets, and these people are putting down tens of thousands of dollars, and they will cash flow like $150-200/month, and then have some large capital expense that wipes out a year or two of profits on the house. And then the stories about evictions, wow, just sounds absolutely terrible. Professional tenants that know how to stay in your house for almost a year for free. That shit blows my mind: that's my fucking house, you aren't paying rent, how the fuck can't I just go kick you out?
 
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Kiroy

Kiroy

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Falxy-US said:
I whole heartedly agree on residential real estate as investment. Once a year I'll get interested in rental properties, and go start reading on bigger pockets, and these people are putting down tens of thousands of dollars, and they will cash flow like $150-200/month, and then have some large capital expense that wipes out a year or two of profits on the house. And then the stories about evictions, wow, just sounds absolutely terrible. Professional tenants that know how to stay in your house for almost a year for free. That shit blows my mind: that's my fucking house, you aren't paying rent, how the fuck can't I just go kick you out?
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Renting is a fools game unless you do it full time with a portfolio of at least 5 rentals or more (the more the safer). You need to be a dedicated GC/manager/accountant, or have enough income to have one on payroll. All your places should be local to you unless you own large number of properties. Obviously the numbers change if you have any rentals that you've completely paid off.

We had two rentals out of state (homes we just kept after various moves) and it was always stressful. In the end they both ended up being net losses even with making a few hundred a month on each. Every time I'm reminded that we finally sold them off I get a warm feeling inside. Never again.
 
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Sanrith Descartes

Sanrith Descartes

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Fogel Fogel I rolled out of the $20 strike for $1.50 and into the $17.50 for 90 cents. Cut my max profit (but I wasnt planning to hold it to expiry) and lowered my strike. my cost basis now would be around $14.50 if assigned.

Might be the best play for you as well. Right now you can buy to close to $20 for 1.60 and write the $17.50 for .90
 
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