Red Lion

I sold APO $65 1/20/23 puts for $6.50

I've got kids around for halloween today, I'm going to need to make a few pots of coffee and devote some time to poring through this link, because a cursory read is WAY over my head. Very interesting though, and if the author's projections/modeling is correct, it seems like it could be a very good interest rate hedge. Are swaptions even available to retail investors?

I'm trying to wrap my head around this. I'm thinking I would need to open an IB account to put these trades on, but just to make sure I understand what's going on. Do you have a recommendation on where to do research on these trades? I'm looking at this website for quotes on the June 22 futures contracts for 10 year notes. https://www.barchart.com/futures/quotes/ZNM22/overview So essentially I would be looking to purchase a put option on this futures contract. https://www.barchart.com/futures/quotes/ZNM22/options/jun-22 is what I'm looking at for quotes for options on this futures contract, if I'm reading this right then the strike price $129.50 PUT would be at the money, and would cost me $1,516 per $100,000 contract. So for position sizing, you would look to buy 6 put options on 10 year note futures at the money, so approximately $9,000 cost to hedge $600,000 10 year treasury futures at the money until June 2022?

My equity portfolio is 100% invested long, and concentrated. I certainly feel like I could use some asymmetrical put protection, although my history in this regard has been terrible. Most of my net worth is tied up in two closely held businesses where I own 50% stakes, so I've grown to accept more than average volatility in my equities portfolio. I've had several puts expire worthless over the last 3 years. My worst mishap ever though was loading up on a bunch cheap BAM puts at a strike price of $55 (pre split) back at the end of 2019 to expire I believe in June of 2020. I sold them for a loss at the end of January 2020, and then proceeded to see my BAM shares drop ~50%. Since I had more puts than shares of BAM I would have actually profited handsomely from the drop if I had just held on to that one position until expiration. I've searched BAM/KKR/APO puts pretty closely, and they're a lot more expensive than before, so I've remained unhedged as I remain bullish about these positions (and they're also my top three in that order).

Brilliant. I'm going to have to digest this one, but this seems like it could totally fit my needs. I've been sitting here researching options on treasury futures, which seems like it might be a decent pure play way to buy puts on a large notional dollar amount without paying through the nose. It still looks like it would cost $18k or so to hedge against $600k treasury bonds at the money until June 2022, possibly quite a bit cheaper if I lowered my strike prices.

I'm looking to purchase a home probably sometime in the middle of next year, I'm concerned about rising interest rates, and would like to come up with a way to hedge against rates rising in the next 12 months. Has anyone thought about this? PUTS on TLT, or maybe some type of leveraged preferred stock ETF? I'm probably looking to borrow around $600k, so would love to hedge interest rates for around that dollar amount, I've never traded in futures or interest rate swaps or anything like that, not even sure if they are available for what I'm trying to do.

I'm going to look into doing this. I've just finished setting up a 401k for my business and should be making the max employee contribution this week. I've set this account up for limited options privileges at Schwab. This should be great for cash secured puts, although the account will only be starting with $19,500 so even the $350s would be slightly out of range. I have a taxable concentrated portfolio of common stock (mostly alternative asset managers) that are sitting on significant capital gains, and am trying to put as much money as possible into tax deferred accounts so I have more flexibility to pursue some options strategies/trading/higher yield investments. I've really enjoyed reading your posts and the thread on APTS is part of the reason I paid for membership.

That's an excellent recommendation, thank you so much. I will look into this option, although at >$500 the position sizing is a bit high for my portfolio even on one contract.

Opened a new position in SAM yesterday at $520. Would be happy to keep adding to this initial position if the price continues into free fall. This is one of those companies I've watched for years, and never pulled the trigger because the valuation was so high. It's not cheap by any means, but regardless of the short term ups and downs, I think this one is well positioned in the craft brew segment (and seltzer too) with good margins, ROIC, long term tailwinds, and (hopefully) pricing power. I think a rollup type strategy could be very effective here with high multiple, strong balance sheet, and lots of privately held subscale craft brewers as potential targets.

Imitation is the best form of flattery they say. I bought FISV and SFTBY over the past two days.