Jump to content

ERICOPOLY

Member
 View Profile  See their activity

  • Posts

    9,589

  • Joined

  • Last visited

 Content Type 

Posts posted by ERICOPOLY

    2021 Returns Thread

    in General Discussion

    Posted · Edited by ERICOPOLY

    2 hours ago, rayfinkle said:

     

    Hey Eric- hoping to clarify what you mean here. Can you let me know  if this is what you mean?

     

    30% notional exposure in ATM calls....

    - ...gives you the same exposure as if you'd invested in the underlying with 30% of total dollars, but puts less $ at risk

    - ...Therefore ppl may be more likely to actually make a concentrated bet

    - ...the downside is that you are time-bound and will have to roll the calls (increasing your basis) to keep the trade alive past expiry

     

    30% writing puts...

    - ...Funds the premium for the above calls

    - ...Is equivalent to "limit orders" on a diversified basket of names at the strike

    -... to clarify, are you contemplating these as ITM / ATM / OTM? 

     

    When combined...

    - ... buying the calls, funded by puts, means you have 30% of the portfolio "reserved" in case the puts are exercised. In this sense the trade is leveraged to the upside but not to the downside

    - ...you get "free" upside in the sense that if you were going to buy the positions that you wrote puts on anyway, you now get similar exposure to those names PLUS a rider on the call options

    - ...you lose on the puts in two possible ways: 1) is if the underlying puts (assuming they are OTM) are never struck, so you never get the long exposure, and then those stocks go up. you'd therefore lose the upside, 2) if the puts are exercised and the stocks go down. (1) leaves you worse off than just getting a position in the underlying; (2) is equivalent to owning the underlying

    - ...the calls main drawback is the duration. If you have to roll them to keep your exposure you suffer some frictional costs in maintaining the exposure. Over time this could erode returns

     

    Did I get this right?

     

     

    You talked about things like leverage and free upside.  Look, I'm not saying anything like that.

     

    I'm just saying:

    1). you are taking ONLY the downside of the diversified basket of 100 names (none of the upside)

    2). you are taking ONLY the upside of the concentrated name (none of the downside).

     

    Derivatives were created for swapping risk.  I'm not saying anything unusual or surprising.

    Is Munger "On Tilt"?

    in Berkshire Hathaway

    Posted

    On 1/6/2022 at 12:36 PM, brianr27 said:

    In a recent interview, Ray Dalio placed the odds of a civil war in the US at 30% in the next decade. That may sound far fetched but it's not clear to me that the US is going to anymore politically stable than China in the coming decade.

     

    That civil war thing is kinda mainstream thinking:  https://www.npr.org/2022/01/11/1071082955/imagine-another-american-civil-war-but-this-time-in-every-state

    How was your Omicron experience?

    in General Discussion

    Posted

    Because OSHA ETA ran out last month, employees can no longer stay home sick AND PAID if they had previously exhausted sick time.  Unless their employer voluntarily gives them additional paid sick time.

     

    The sunsetting of that policy is a covid spread accelerator.   From what I am seeing, people do not voluntarily stay home sick UNPAID.

     

    2021 Returns Thread

    in General Discussion

    Posted · Edited by ERICOPOLY

    1 hour ago, IceCreamMan said:

     

    You mean on top of 100% long portfolio, right? i.e. 100% long + 30% notional long calls funded by 30% notional short puts = 130% effective exposure?

     

    I didn't say that.

     

    It can be 100% total exposure.  For example, 70% long diversified common stock portfolio in addition to the 30% notional position in the calls, and the 100 name collection of written puts with 0.3% notional exposure each..

     

    Derivatives were made to swap risk.  So you can use them for what they were made for.

    How was your Omicron experience?

    in General Discussion

    Posted

    21 minutes ago, Gregmal said:

    https://nypost.com/2022/01/09/alexandria-ocasio-cortez-tests-positive-for-covid-19/
     

    “If I had a dollar for every lockdown politician who decided to escape to Florida over the last two years, I’d be a pretty doggone wealthy man, let me tell ya,” DeSantis, 43, said

     

     

    Hopefully AOC recovers. Although her symptoms apparently mimicking that of a hangover, so who knows. 

     

    DeSantis is cute, but AOC is vaccinated today and lockdowns predated that.

    Is there a value rotation going on today?

    in General Discussion

    Posted

    4 minutes ago, Blugolds11 said:

    What I do see is that the middle class is getting squeezed and everyone feels it, but they struggle to put their finger on what they are feeling and that frustration ends up getting directed toward "them" on the other side of the aisle. Either side of the aisle. 

     

    There's literally a job for anyone who wants one with signing bonuses for jobs like delivery drivers.  This is the most amazing job market for low-skilled labor I've witnessed.

    2021 Returns Thread

    in General Discussion

    Posted

    On 1/6/2022 at 3:11 PM, Gregmal said:

    Everyone likes to pretend that you wait for the fat pitch and then put 30% in it, but 95% of investors can’t capitalize on those because they get scared by the perceived risk. 

     

    It's why buying ATM calls on 30% notional portfolio value make sense, funded by writing puts on 30% total portfolio notional across 100 other names if your risk tolerance is such that 0.3% position sizing in any one name is as large as you can tolerate.

     

    Sigh...

    What are you listening to ? (Music thread)

    in General Discussion

    Posted · Edited by ERICOPOLY

    1 hour ago, boilermaker75 said:

     

    I found a few photos I took. They have faded, as have I!

     

     

    Scan 2022-1-9 16.25.00.jpg

     

    Thanks for sharing, that is very cool that you kept those photos.  Close To The Edge was/is my favorite (and the next one after it on the album by said name).  My other favorite is Heart Of The Sunrise, the last song on Fragile which immediately preceded the next release which was Close To The Edge.  I can't think of another band where that has happened for me.

    The next 20 years

    in General Discussion

    Posted

    1 hour ago, Gregmal said:

    Eh I read super compelling and thoughtful research 5 years ago that predicted negative returns for the following decade. Then we have a redonkulous 5 year stretch. 
     

    The future can unfold in ways we either underestimate or can’t predict so IMO it’s better to just focus on owning quality stuff and then managing the risk on, risk off aspect.

     

    I remember people kept saying "we're turning Japanese".  I kept saying the PE of Japan's stock market was quite high after they turned Japanese.  Today, looks like we've turned Japanese just like they worried about.

    How was your Omicron experience?

    in General Discussion

    Posted

    7 minutes ago, SharperDingaan said:

    Lot of folks in health care are privately saying Omicron comes down as fast as it went up, and that it is largely done by end of Feb. Omicron is also a major blessing, as it has brought forward the endemic (herd immunity) stage of Covid by months, and way more reliably than could have been done by vaccination. Immediate mass infection/immunization of un-vaccinated protestors, vs slow drip.

     

    Authorities responsible for ongoing operation of the health care system are in a bind. To mitigate collapse they can only publicly advise caution, and try to minimize hospital visits while 20-30% of staff are down with it. Hence, restrictions and curfews until staff are returning faster than than new ICU admissions grow. Cant yet tell Joe Public to get infected, as there just aren't the beds. However its purely a volume - and not a severity thing  driving the bus. Very temporary.

     

    Once the 1st world starts waking up (All at the same time, and in Mar-Apr?), most would expect rapid change.

    Runups in economic activity and supply chain, offset by sooner/higher bumps in interest rates and energy prices. The more the recovery becomes evident, the more rapidly public sentiment changes, and the higher/sooner the euphoria spend (VE day effects). Historic asset bubbles start looking like zits.

     

    All around the 1st world the messaging has been subtly changing.

    It's no longer we're fighting Covid, it's we're living with it. Endemic stage.

     

    Once in a lifetime opportunity coming up 😀

     

    SD

     

     

     

     

     

     

     

     

     

     

    Totally.  I can't fathom the whole "The TOP is coming" sentiment, other than to say yes, IT IS COMING and I'm so excited for it!!!

    What are you listening to ? (Music thread)

    in General Discussion

    Posted

    26 minutes ago, boilermaker75 said:

     

    LOL, it's all relative!

     

    I vividly recall it would alternate from feeling like we were orbiting counterclockwise, then I would catch myself and it would feel like we were losing ground to it and it was overtaking us, kind of like a rapper on a turntable scratching a record in slow motion only we were seated on the vinyl and the stage was in the center.

    What are you listening to ? (Music thread)

    in General Discussion

    Posted · Edited by ERICOPOLY

    27 minutes ago, boilermaker75 said:

     

    I am a big fan of Led Zeppelin.

     

    Page, Jones, and Bonzo were probably as good of musicians as in any band. Maybe even better than The Who with Entwistle, Moon, and Townshend.

     

    Page was a very sought after session musician before the Yardbirds, and Jones was a very sought after session musician before Led Zeppelin. If you listen to sixties music from the UK you are often hearing Page and Jones and don't even know it.

     

    It is said that Page played without mistakes, and time is money in a studio.  He was first to bring a distortion box to a studio and introduced it.  Before that they used kicked in speakers and maxed-out amps and such...

     

     

    What are you listening to ? (Music thread)

    in General Discussion

    Posted · Edited by ERICOPOLY

    Ten Years Gone is one of my top 5, and I don't know how that went for Plant.  I mean, he's married with kids at the time he wrote the lyrics, which are about a girlfriend he had 10 years prior who asked him to choose between her and his music.  He's clearly still in love with her -- did his wife kick his ass or what??? 

    What are you listening to ? (Music thread)

    in General Discussion

    Posted · Edited by ERICOPOLY

    21 minutes ago, finetrader said:

    Get The Led Out: They’re very good!  Musically, it’ sounds the same than the original.

    The thing with Great Zeppelin (Great White) is Jack Russell’s voice. He sounds just like Plant.

     

     

    Apparently, Plant approved himself;

    Robert Plant, « Oh, that Jack Russell guy, he sounds more like me than I do » 


    check this out !

     

     

     

     

    I'm listening to Great Zeppelin on Spotify at this moment.  Yes, it's very good.

     

    I saw Robert Plant at Shoreline Amphitheater in 8th grade (going on 9th) when he toured A Principle of Moments.  Communication Breakdown/Black Country Woman/Sick Again if I recall were the only Zep songs he did, but it was a taste.  I have loved the music going on 36 years now.  

    What are you listening to ? (Music thread)

    in General Discussion

    Posted

    3 hours ago, finetrader said:

    Led Zep !
    Ya !

    do you know Great Zeppelin ?
    Awesome  cover album(s)

     

    These days, i am revisiting Dream Theater - Black Clouds & Silver Linings

     

     

    I will have to check them out.

     

    Get The Led Out is a cover band that I've seen live a couple of times.  They tour the country:

     

     

    Here are a few of their live performance videos:

    https://www.gtlorocks.com/videos

     

    There are six of them in the band, not four.  They explain that the six musicians allow them to replicate the music as you hear it on the albums (overlayed tracks cannot be played by just four guys live).

     

    Very fun shows, they are awesome.

     

×
×
  • Create New...