CDZ The Flight to Safety And From Sanity Have Both Begun

[william the wie]

Both the barely in the money puts I have written and the underlying securities I am trying to get paid a minimum of 10% for acquitting are going up. So, the sane members of the market are headed towards the low Beta stocks I am trying to acquire. The speculators are bidding for the already overpriced puts I have issued. But since my maximum Beta is 0.27 it will take a 37% drop in the indices or more for me to lose money. That is a very low probability outcome.

The people bidding up the puts seem to assume that in a risk off situation it makes sense to sell low risk stocks and buy higher risk stocks. I do not follow this does anyone else?

 

[DarkFury]

Both the barely in the money puts I have written and the underlying securities I am trying to get paid a minimum of 10% for acquitting are going up. So, the sane members of the market are headed towards the low Beta stocks I am trying to acquire. The speculators are bidding for the already overpriced puts I have issued. But since my maximum Beta is 0.27 it will take a 37% drop in the indices or more for me to lose money. That is a very low probability outcome.

The people bidding up the puts seem to assume that in a risk off situation it makes sense to sell low risk stocks and buy higher risk stocks. I do not follow this does anyone else?

The American stock market is WAY out of shape. An honest correction would lower it 3 to 500 points. The future I think here will be coal/steel/brick.

I'm "parked" so to speak in timber. Short term would be the timber and long would be the property for development. Low risk vs high risk? High risk is high returns.

What constant where you live is at its low cycle? Constant being say Lever Bros. a soap/shampoo/laundry/etc. Cattle companies in Cali suck right now because of the drought. But one or two rainy seasons it will sky rocket. In that case sky rocket is simply back to normal.

I think the Euro will take a very dramatic dive very soon but will recover. You might want to invest simply in money. China devalues at the drop of a hat so avoid that.

 

[william the wie]

Me, I'm making money, my losses are capped and I am simply wondering what besides LSD was in the fruit loops eaten by the put buyers?

 

[DarkFury]

Me, I'm making money, my losses are capped and I am simply wondering what besides LSD was in the fruit loops eaten by the put buyers?

I have no idea I just know when I see a highly used commodity like cattle that sooner or later it IS going to rain. And when it does fields will be green and will be full.

I guess I should look at Texas cattle as well. California has to re-stock from somewhere. That could push their prices up there.
The next wildest market should be housing in about 15 years.

The rest of the "baby boomers" will be retired and selling and there will be a HUGE glut of homes. The ONLY real estate I would think about right now is Josephine County Oregon.

The county went broke so NO fire/police services there at all. Just volunteers. Housing prices in out lying areas are down 70%. Buy the property and burn the house. You still wind up with an improved lot {most 1 acre} for about 10k or LESS.

I like to buy cheap, dirt cheap and sell medium and move on to the next deal. Leave some edge for your buyer to do the same and they will but whatever you are selling.

 

[Freemason9]

Both the barely in the money puts I have written and the underlying securities I am trying to get paid a minimum of 10% for acquitting are going up. So, the sane members of the market are headed towards the low Beta stocks I am trying to acquire. The speculators are bidding for the already overpriced puts I have issued. But since my maximum Beta is 0.27 it will take a 37% drop in the indices or more for me to lose money. That is a very low probability outcome.

The people bidding up the puts seem to assume that in a risk off situation it makes sense to sell low risk stocks and buy higher risk stocks. I do not follow this does anyone else?

If you are a day trader, the odds are that you will have a substantial net loss over the next year when you add in fees.

 

[william the wie]

Both the barely in the money puts I have written and the underlying securities I am trying to get paid a minimum of 10% for acquitting are going up. So, the sane members of the market are headed towards the low Beta stocks I am trying to acquire. The speculators are bidding for the already overpriced puts I have issued. But since my maximum Beta is 0.27 it will take a 37% drop in the indices or more for me to lose money. That is a very low probability outcome.

The people bidding up the puts seem to assume that in a risk off situation it makes sense to sell low risk stocks and buy higher risk stocks. I do not follow this does anyone else?

If you are a day trader, the odds are that you will have a substantial net loss over the next year when you add in fees.

That's why I don't day trade but I do hedge.

 

[william the wie]

DF, I do not know and therefore do not go into commodities but it is my, perhaps wrong, understanding that west coast beef is sold mostly to the Far East and the Russian herds are expanding to take away that market from the West Coast. Is that information wrong?

 

[DarkFury]

DF, I do not know and therefore do not go into commodities but it is my, perhaps wrong, understanding that west coast beef is sold mostly to the Far East and the Russian herds are expanding to take away that market from the West Coast. Is that information wrong?

You are correct. But the market needs to rebuild just to meet domestic supply. Or very shortly they will not be able to compete.

 

[william the wie]

Are there LEAP options on live cattle in the futures market that would actually permit you to reduce risk without eliminating return? I operate on the principle that normally no one can call the turns. However increasing volatility can be predicted with useful accuracy. For example:

In 2002 the publication of "When Genius Failed" about the rise and fall of Long Term Capital Management made it crystal clear Bear Stearns and Lehman Brothers were in deep trouble in 1998, that the SEC and Fed lacked the powers to do anything about it at that time and no one knew what to do about it.

Tudor Roberts bought up all copies of the documentary of how he was able to usefully predict the volatility that led to the 1987 US crash and the 1994 crash in Japan so, the precise way he did so is not known but NN Taleb and others have published the methods that they used.

Sy Harding in 1999 in "Riding the Bear" went into the methods of how to operate to usefully take advantage of increased volatility.

Are there similar works in the commodity space?

 

[DarkFury]

Are there LEAP options on live cattle in the futures market that would actually permit you to reduce risk without eliminating return? I operate on the principle that normally no one can call the turns. However increasing volatility can be predicted with useful accuracy. For example:

In 2002 the publication of "When Genius Failed" about the rise and fall of Long Term Capital Management made it crystal clear Bear Stearns and Lehman Brothers were in deep trouble in 1998, that the SEC and Fed lacked the powers to do anything about it at that time and no one knew what to do about it.

Tudor Roberts bought up all copies of the documentary of how he was able to usefully predict the volatility that led to the 1987 US crash and the 1994 crash in Japan so, the precise way he did so is not known but NN Taleb and others have published the methods that they used.

Sy Harding in 1999 in "Riding the Bear" went into the methods of how to operate to usefully take advantage of increased volatility.

Are there similar works in the commodity space?

With the cattle I just know the drought will end. So I know it will go up next year or the tear after. So I'm just betting the odds on a good rainy season there.

With the coal i am split three ways 1, The actual ore. 2, Mining equipment. 3, Transport. Current stock prices on the actual coal via companies is under 2 dollars a share. If they {government} eases just SOME of the restrictions it will go up and I see profit in the coal the mining equipment and transport. I'm no broker by any means just try to see the leans towards things and play the odds because in the end it's all gambling.

Now as far as futures I HAVE found a company I find VERY interesting. Short term looks good and with the right production and sales model its future could be outstanding. The product already have 45k in orders and those are not due till the fall of 16.

And they have a finance plan that enables buyers to get their product fast and easy. So it looks good as BOTH a short term and a long term.

Here, have a look and tell me what you think..
Elio Motors

 

[william the wie]

A great design for Europe for taxes on fuel and possibly India and China for crowded roads. I would first check Yahoo Stock Screener for pipeline companies. Transportation costs are a huge factor on delivery costs.