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  • Stocks, Options, Both ?

     reico updated 1 year, 4 months ago 8 Members · 10 Posts
  • Curunir

    May 12, 2021 at 10:45 am

    Curious who are stock-only, option-only or a mix of both when it comes to their AMC efforts.

    I have a few hundred stock but have also some options in AMC. I had been doing some research & paper trading already for a while since I see it as a strong leverage. About a week or so ago when we were still in the $9 range I started picking up options.

    They are more of a risk because you’re really setting a price target and could loose your investment if it’s missed, but at the same time it’s been letting me do about a 10x leverage. Playing it reasonably safe ( $14 strike price targets for example). If the moon shot happens while they are still active it would be amazing but as long as we pull profit I’ll use it to buy more “real” shares and another round of Options.

    Anyone else?

  • Oath

    May 12, 2021 at 11:05 am

    Speaking as a poor person.

    Options are too risky.

    Stock is the way to go

    I also hear options are not hurting the hedgies.

  • Curunir

    May 12, 2021 at 12:20 pm

    Absolutely right that options are not hurting the hedgies. That’s why most of my $ value is in real stock.

    The risk is that it’s a lot more of a gamble. With stocks you “own something” and no matter how long it takes you can hold until it goes up. You don’t loose anything unless you sell when it’s down.

    With options you could easily loose your investment if it misses your target (strike). But the advantage is the leverage of 100 shares per. With a lot of stocks the premium falls in at like $3 – $5 per share so you may have $300 – $500 on the line. That’s scary for me. But I was getting AMC options for > $1 per.

    So $100 would get me 10 more real shares. Let’s say it hits $25 mid-June so that’s a $150 profit at that level.

    The same $100 bought one option for $14 strike (target) on 6/18. Again, if we hit $25 by that date then it’s a couple thousand in return. A chunk of that can buy into some real shares for the ride and maybe another option. Of course if we end that Friday at $13.99 then I’m out the $100 completely.

    Absolutely do not recommend it as primary investment or even secondary unless it’s literally poker-and-whiskey money that you can absorb loosing.

  • dr.degen

    May 12, 2021 at 4:48 pm

    TLDR: Ape buy stock, hold, buy more, hold, repeat. Evolved ape have options.

    NOT FINANCIAL ADVICE. From what I’ve read, seen and experienced with GME in January was that the Options hitting in the money caused a Gamma Squeeze the Friday before the launch to $500, as Market Makers went to cover their losses in Options on Monday. However, Options are not actual shares unless they are exercised. Every Options contract is a right or obligation to purchase (or sell) 100 shares of the stock. From what I understand, when you buy a call, the Market Maker needs to go out and grab 100 shares of the stock for each contract purchased in the event the contract is exercised and not sold. Once the contract is sold, the Market Maker does whatever with the shares (holds or sells). So, to finally answer the question, we need both, share buyers and options buyers. If there are no shares available, the price goes up due to simple supply and demand. As stated before, Options are risky and (not financial advice) this WOULD NOT be the time to get in and learn. Things can get really f’d in your account if you panic and press the wrong button and don’t have the funds to cover your options contracts. From what I’ve heard, buy shares, hold, buy more shares, hold, repeat.

  • Shawn

    May 12, 2021 at 7:13 pm

    Options are to risky for my blood ill stick with straight stocks

  • robodrill

    May 12, 2021 at 7:51 pm

    I have a fairly solid retirement plan. I won’t be rich, but I can afford to live.

    I added a speculation account to that. I put some money in, grew it, then took the money out. I have recently put about 11,000 back in and will take it out as soon as it makes sense to do so. My total portfolio can cover the amount I put in.

    I only buy stocks.

    My account can go to one dollar, and I will be ahead by one dollar.

    I never risk more than I can afford to lose, and I never borrow money to invest.

    I do not have a margin account, therefore it is impossible for me to lose real money in the real world, where my labor earns it.

    I think it is a very bad idea to risk what one cannot afford to lose.

    If I did place options, I would do so with enough reserve to pay it all if it goes badly.

    Doing otherwise is to fall into the trap, IMHO. It is like a casino. The “house” wants you to bet the family farm because the house wins it all, eventually.

  • Bairoax

    May 12, 2021 at 8:10 pm

    I got both, more stocks than options but I see value in both.

  • Curunir

    May 12, 2021 at 8:52 pm

    I don’t play margin either. Too dangerous. When I buy options it’s with cash value in the account that I’m ok loosing if it goes south. Just sell them off before expiry either in-the-money and make some profit or sell for a loss of money you were willing too loose.

    Most invested $ value I’m playing with here in AMC is in raw stock though.

  • Anonymous

    Deleted User
    May 12, 2021 at 9:55 pm

    Stocks only here. 25k total.

    I was lucky with LONG TESLA stocks that I sold for AMC this year.

  • reico

    May 13, 2021 at 4:53 am

    Good option call for June?

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