Trader turns $500 into $300,000 over weekend

[frankmatthews]

It'll move, weekly options are high gamma.

Do we know if he bought weeklies though?

Even at $55, the value of the option wouldn't move because it is so close to expiration.

It will definitely move fam. Even if the underlying moved $1.50 he would still make money

Deep OTMs aren't necessarily gonna move like that. You need volatility and time to see significant moves in OTMs. And as was mentioned, the spread could eat any gains on such a small move as well as time decay with only a week left.

I'd really like to know what the delta, gamma, theta and Vega was on friday.

 

[johnnyredstorm]

Yeah the 12/11/15's for .05. Realistically, a $5 move overnight gets them to probably .05 by .15 at the worst. Mid-market would be a double if he can get filled. Of course splitting the spread would lead to them dropping the ask to .10 and you have to play that stupid game. So yeah, the bigger issue is exiting.

 

[al audi]

http://www.usatoday.com/story/money...ain-jab-holding-company-acquisition/76913020/


sold for 14 billion

guy had an inside tip

 

[Betonblck]

Yeah the 12/11/15's for .05. Realistically, a $5 move overnight gets them to probably .05 by .15 at the worst. Mid-market would be a double if he can get filled. Of course splitting the spread would lead to them dropping the ask to .10 and you have to play that stupid game. So yeah, the bigger issue is exiting.

It could get them to 0.15, or it could get them to 0.10, but the time decay is something serious. Then having to sell and the spread might drop back to the 0.05 he paid. That's why the $60 strike makes me believe he had inside information.

A $55 strike would net him at least 100% gain if the stock went to $55. That's the way smarter and less risky option move.

This is like paying $500 to buy a $500K term life insurance policy and the person dying that year.

 

[al audi]

This sounds like it might be a little personal, bro.

"oh look, someone made a crazy profit on a once in a lifetime options trade. This is a great time to talk about dudes flexing on the gram. Take that, resellers!"

That's a crazy flip. Probably a very uninteresting story at the end of it all.

personal?

im not big into sneakers like that, an i know resellers in high end world

my statement was sarcasm and fact................................and the people i know into luxury reselling do way better than these GR sellers, actual income

my statement still stands

 

[mplsdunk]

You got to start somewhere. It's all the same ****. Just different markets. Houses, shoes, cars, cattle, commodities you can literally flip anything and it's easy as long as you got the funds on deck to do it.

 

[superantigen]

I really need to sit down and study options because my head starts spinning the minute y'all start throwing option terms around...






...

 

[slighted]

 

 

I mean, yeah maybe he knew something, but it doesn't necessarily have to be the case. It's just a $500 bet, if the stock moved it's traditional ATR he would've doubled his money regardless. I'm gonna lean on being naive and saying he just got lucky.

If we had someone around here to give us advice maybe this could have been one of us. But no...............

If only there was a registered financial advisor on here who could help us

I run my own fund. NT fam, hit me up.

Summary

Munch Da Coochie Capital

Long / short equity

AUM: $5000

Minimum investment: NT +rep

SEC Registration: No comment

Auditor: Trust me

Philosophy: Employ turbo leverage for capital explosion

 

[wayniac211]

Where's gold st. capital to make sense of all this

 

[johnnyredstorm]

Yeah the 12/11/15's for .05. Realistically, a $5 move overnight gets them to probably .05 by .15 at the worst. Mid-market would be a double if he can get filled. Of course splitting the spread would lead to them dropping the ask to .10 and you have to play that stupid game. So yeah, the bigger issue is exiting.

It could get them to 0.15, or it could get them to 0.10, but the time decay is something serious. Then having to sell and the spread might drop back to the 0.05 he paid. That's why the $60 strike makes me believe he had inside information.

A $55 strike would net him at least 100% gain if the stock went to $55. That's the way smarter and less risky option move.

This is like paying $500 to buy a $500K term life insurance policy and the person dying that year.

Time decay is really only an issue on Thursday and Friday's. On monday the option will retain its price (if he holds overnight into Tuesday or till expiration that's a different story). It's the spread that's the issue since it'll get wide or just be annoying to get filled unless it goes .10 or .15 bid which is possible and you just hit the bid to get out. If his plan was to take a quick gamble and try a one day trade, a double isn't facetious. Just dumb r/r.

 

[dipsetgeneral]

Congrats to man. Too bad he's going to have to pay some taxes on it

SMH, i know.

 

[slighted]

 

Congrats to man. Too bad he's going to have to pay some taxes on it

SMH, i know.

Assuming the worst case (40-50% tax), $150-180k from $500 is still good.

 

[e3lal]

This is just as interesting - stock flipping senator. From ZH

"Senator Corker recently" amended his filings to reveal a 2009 purchase of between $1 and $5 million of CBL stock, sold just five months later in 2010 at a 42% profit. Similarly, Sen. Corker made purchases worth between $3 and $15 million in 2010 and, just after his last trade, UBS said it was upgrading its outlook. The stock went up 18%. Shortly thereafter, Sen. Corker began selling; a week later, UBS downgraded the stock and the share price soon declined about 10%."

http://www.zerohedge.com/news/2015-...ose-millions-hedge-fund-real-estate-investmen

 

[al audi]

Assuming the worst case (40-50% tax), $150-180k from $500 is still good.

basically but it still sucks lol