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thought i'd share, for those that trade options, I like this one

sell UPST Jul $95 put for about $1.30 (not sure what pricing will be monday, obviously)

if you are happy to own UPST at about 20% discount from now and collect $1.30 per share over next 3 weeks

kind of looks like premiums are falling after recent surge up and down, so maybe this kind of pricing won't last
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re: UPST

Don't own any Options whatsoever. Options is a "ZERO SUM GAME". And as a smart investor/trader don't trade Options.

Upstart Holdings, Inc. UPST, now is in a stagnant mode waiting for a breakout.

Quill -
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Simon sayz buy UPST?

Have to go and take a look and look for what chart master sees 😁

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Grasshopper aka Bella,

Observe the skid marks along the 120.00 line waiting for a breakout even though there was a buy signal on 6/17/21. Waiting for the bottom panel to see getting past the 0.20 line heading north.

Hope your keeping up with your student studies.

Quillnpenn -
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"Options is a ZERO SUM GAME, and smart investor/traders don't trade options."


I edited a bit what you said, because I want to take exception to it, in two parts, with the second part coming first.

#1, you don't like options, because you got your butt kicked when you tried to trade them. So your "advice" has to be dismissed as 'sour grapes'. Do many people make money trading them? Probably the same small number who make money trading currencies, or futures, or the pennies, or whatever requires these four things:

_ #1, a passion for the game for its own sake.
- #2, a willing to do the needed work and not just a desire to "make a quick buck".
- #3, a sound business plan, including how you will manage your risks, not just spend your gains.
- #4, adequate capitalization.

You're a smart, savvy, hard-working trader for whom I have a lot of respect (and affection). I'd suggest there are three reasons you failed. #1, you didn't stick with it long enough to learn the game. #2, you didn't do your own thinking about what the game entails. #3, you had other, easier fish to fry. So, you gave up.

Next, a two-part question: "Are options really a 'zero sum game' any more than any of the other games in the financial casinos? Does it make any difference to being able to pull more money out of the game than you bring to it?"

So, let's begin with a definition. In a 'zero-sum game', bets and payoffs are symmetrical and equally probable. A classic instance we all know from childhood is 'flipping for pennies'. If you have $1 and I have $10, we can flip for heads or tails all day, and likely neither of us will walk away a significant winner or loser. But if you're dumb enough to let the bet size be increased to two-bits, there's a reasonable chance I'll break you in as few as four flips, and nearly always I walk away with all of your money. So, bet-size matters. That's the first thing to understand. Whether the game is zero-sum or has a positive expectancy, the market can remain irrational longer than you can remain solvent, with the blowup of LTCM being a classic instance of this. Six months after Greenie stepped in, nearly all of LTCM's trades were turning a profit, just as their models had predicted they would. But they didn't have the capital to wait it out. That's where they screwed up. They over-leveraged, and when the ruble blew up, they were on the wrong side of the trade in the short term, and their counter-parties wouldn't float them.

(to be con't)
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(continuing from prviously)

Next, let's create a game with less than a positive-expectancy in terms of "right/wrong" ratios. In fact, let's make winning trades to losing trades an adverse 1:2, which is pretty close to the profile of a classic, trend-following system such as used by the Turtles. As you know, they made a ton of money, as did Seyoka and others. Two reasons: payoffs are/were asymmetrical, and they aggressively chopped left-hand tails. Said another way, 'risk-management/trade management' is what matters, not fairy tales about "wide moats", "customer loyalty", etc. When a position is put on, only one thing matters, getting in and out in a timely manner.

With options, two thing have to be gotten right (or else hedged): 'price direction' and 'timing'. But it's possible with options to limit one's downsides. Thus, it isn't hard to have the amounts being won offset the amounts being lost, which is really what matters in every financial game offered in the casinos (--err, on the exchanges). In the case of UPST, using puts is a whole lot easier for most investors than selling short (due to margin requirements, borrow fees, etc.). So, in that sense, what the OP posed to do shouldn't be dismissed --as you did-- out of hand. But its timing could be questioned. As a chart of UPST shows, the rollover was weeks ago. That was the time to be setting up to get short with a simple put. Now, prices are channeling, and things are a whole lot more complicated.
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With UPST trading sideways, this is still a good trade (if you are willing to own UPST): sell Jul or Aug put about 20% to 30% out of the money.

…Options is a "ZERO SUM GAME”…

Options as zero sum would be correct only if buying and selling stocks is zero sum. This is because buying and selling stocks is one way that options market makers hedge their trading books.

As an example, I can buy a call from an option market maker and the following can occur. The market maker buys stock (amount based on delta of the option) to hedge and is thus long stock and short the call sold to me, so the market maker does not have equity risk. The price of the option includes an interest rate that encompasses the market maker’s cost to hold the stock (e.g., cost of funds, securities lending value, liquidity, etc) plus a spread. The market maker makes money on the spread regardless of how the stock price moves (the equity risk is hedged to zero, so there is no gain/loss from stock price movements).

If the stock goes up, then I make money on the long call, so both me and the market maker make money and there is no zero sum. If the stock goes down, then I lose money, and the market maker still makes the spread, which is not related to my equity loss, so there is no zero sum. These outcomes for me are no different than if I buy the stock outright, except when I buy a call option the market maker is financing part of the cost and charging me an interest rate (and the option has a time value component related to the stock’s volatility which I am buying).

The theory of asset pricing explains why the above is possible.

The above scenario is not fundamentally different from me borrowing money and buying assets, stock or otherwise, that provide some return on investment.

…And as a smart investor/trader don't trade Options.
Nonsense, there are many smart people trading many kinds of financial instruments, including options.

In the case of UPST, using puts is a whole lot easier for most investors than selling short…
Thanks for the thoughtful comments! Just to clarify, selling a put is mostly a bullish strategy - it makes money when the stock goes up or doesn’t fall too much. I’m bullish UPST, so I would not be buying puts. In general, buying puts is difficult (at least I think so), so I stay mostly long. Couldn't resist…
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"In general, buying puts is difficult (at least I think so), so I stay mostly long."

Selling puts --on the hopes of collecting the prem-- is beyond my comfort level. But buying puts to make a directional bet makes sense to me. Setting up the trade just depends on seeing in a chart an obvious opportunity, which is why I don't understand Quill's rant. There's nothing wrong with his charting skills, nor his sense of timing as to when to get in or out.
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