No, but I rarely look very closely at small cap biotechs — they just don’t make sense to me, and I know that other people trading them are likely to understand the business and prospects much, much better than I do.
Congrats on your Shopify options! One of the very few success stories that I have heard of (or had) about purchased options. Nice to have a winner – and your dilemma is sweet!
$shop excellent article, as per expectations, travis 🙂 not that it amounts to a hill of beans, but, not including $auph, $shop is my 2nd largest valuation henry
I have heard from the rumour mill that Amazon is thinking about a joint venture which shopify. Market is moving very strange since Trump took office. I am coming to the conclusion he is in over his head and his ego is being over whelmed that being President is not like running a business. Health care didn’t work on repeal and everyone taught it would be and now everyone is having to readjust back and people are making a bunch of money who reverted back to the OBama CARE realignment fast. And General Flynn wanting immunity leads to believe something illegal he knows about President Trump may have given some orders behind the doors but find that a stretch. I would think he would protect Trump. Who knows. I have held my shoify stocks still up by a large %. Also probably will nvest heavily in BRK- B would be a good hedge right now see how things developed over the weekend. Shopify dropped Like a rock. Markets is just crazy to make sense of it of it and just keeping my emotions in check is a struggle.
Amazon has effectively endorsed Shopify, by referring customers to them when Amazon’s similar venture was discontinued, and Shopify has integrated sell-through-Amazon into their offerings. I expect that’s as far as it will go… but you never know.
Sounds like you might need to pause a bit. Take a deep breath. Ignore your portfolio for a week or two. It’ll make you feel better. If you own things that you’re afraid might go to zero in a week, and the positions are big enough to make you that worried, maybe you should sell them. You only get one life, don’t create misery for yourself.
I have high hopes that sanity will eventually prevail in Washington, but sometimes it takes a while. Strong emotional responses don’t usually lead to good portfolio positioning, take care.
Another reasonable option, though the premiums are much higher now than they were the first time I found the options a reasonable speculation. Of course, the stock is also significantly more richly valued as expectations have percolated higher.
Was just looking at ULTI (off a cashflow screen – I’d never heard of it) and SHOP went ding-ding in my head – apples and oranges? And something sent me off to revisit SQ – SQ would make an interesting partner for either (SQ buy out rumors had been around). Then there is MELI – point being, the field is getting crowded and that may eat into SHOP growth numbers down the road. The high stock price might make it an acquirer of something…
For directional options I buy a Delta 70 option. I vaguely recall a TastyTrade market measure or a John Carter video which proved that it provided the best return on capital. If I’m buying a directional option spread I sell the Delta 70 option call and buy the option one or two strikes lower depending on option availability of the lower strike.
$SHOP…you were speculating and have a good profit. But to exercise, you are increasing your capital risk.
Unless you have real conviction about more upside, or believe the stock is a long-term core holding, I would cash out the options and put most of the proceeds into something, like, say, AIG or Berkshire. You could take a portion of your winnings and roll them over into new strikes and expiries on $SHOP if you have a hankering to let it ride.
Speaking of insurers. Do you have an opinion on Fairfax or Axis ?
That’s indeed the question, and after following the stock over the past six months I do have an interest in building a position in SHOP for longer-term speculative reasons — mostly because of the non-financial fundamentals of the company (leadership, culture, and vision) that combine well with the very high top-line growth. I don’t think 6-month options are as compelling now, premiums are far higher than when I bought options. The real risk for me is believing too much in the story before it hits the financials, which is why I would keep it a small position but move from an extremely time-sensitive options position to a equity stake that I can allow to fluctuate much more. That’s my thinking, anyway, we’ll see how it goes.
Axis is an excellent and fairly conventional insurance company, I followed them for a while but never owned the shares. They are pretty consistent and pay a dividend and have a very strong underwriting history.
Fairfax has quietly become a very good insurance company over the past decade or so, though they’ve had troubles with weak performance at some of their acquired insurance operations before. I bought shares for the first time last year and have added on, but it is very much a bet on Prem Watsa’s investment acumen and will be much more volatile than most insurers. I think Fairfax is particularly appealing today because the price is depressed a bit due to bad macro postitioning and a major acquisition.
what is the name of the stock pushed by Motley fool as AI that featured a head with the facial features intact and the rest of the the head and background made of pieces coming together . Other clues were the CEO of ARK said it would create 17 Trillion dollars or be the size of 35 Amazons and Mark Cuban of Shark Tank claiming it will make the worlds first Triilionaire. Thanks
Have you looked at IMMG ?
No, but I rarely look very closely at small cap biotechs — they just don’t make sense to me, and I know that other people trading them are likely to understand the business and prospects much, much better than I do.
Congrats on your Shopify options! One of the very few success stories that I have heard of (or had) about purchased options. Nice to have a winner – and your dilemma is sweet!
They are rare, but having a few 10,000% gains keeps you looking and trying. And sucking up a lot of 100% losses along the way.
$shop
excellent article, as per expectations, travis 🙂
not that it amounts to a hill of beans, but, not including $auph, $shop is my 2nd largest valuation
henry
I have heard from the rumour mill that Amazon is thinking about a joint venture which shopify. Market is moving very strange since Trump took office. I am coming to the conclusion he is in over his head and his ego is being over whelmed that being President is not like running a business. Health care didn’t work on repeal and everyone taught it would be and now everyone is having to readjust back and people are making a bunch of money who reverted back to the OBama CARE realignment fast. And General Flynn wanting immunity leads to believe something illegal he knows about President Trump may have given some orders behind the doors but find that a stretch. I would think he would protect Trump. Who knows. I have held my shoify stocks still up by a large %. Also probably will nvest heavily in BRK- B would be a good hedge right now see how things developed over the weekend. Shopify dropped Like a rock. Markets is just crazy to make sense of it of it and just keeping my emotions in check is a struggle.
Amazon has effectively endorsed Shopify, by referring customers to them when Amazon’s similar venture was discontinued, and Shopify has integrated sell-through-Amazon into their offerings. I expect that’s as far as it will go… but you never know.
Sounds like you might need to pause a bit. Take a deep breath. Ignore your portfolio for a week or two. It’ll make you feel better. If you own things that you’re afraid might go to zero in a week, and the positions are big enough to make you that worried, maybe you should sell them. You only get one life, don’t create misery for yourself.
I have high hopes that sanity will eventually prevail in Washington, but sometimes it takes a while. Strong emotional responses don’t usually lead to good portfolio positioning, take care.
I would dump the SHOP options and re-invest in some new options in Shop.
Another reasonable option, though the premiums are much higher now than they were the first time I found the options a reasonable speculation. Of course, the stock is also significantly more richly valued as expectations have percolated higher.
Was just looking at ULTI (off a cashflow screen – I’d never heard of it) and SHOP went ding-ding in my head – apples and oranges?
And something sent me off to revisit SQ – SQ would make an interesting partner for either (SQ buy out rumors had been around). Then there is MELI – point being, the field is getting crowded and that may eat into SHOP growth numbers down the road. The high stock price might make it an acquirer of something…
I bought Shopify in January and it is up 85% since then. I don’t think it’s done. I would exercise the option.
Excuse me, that was a typo. My SHOP is up 45% since January, not 85%.
You could look at puts to protect your profit if the premiums are reasonable – think of it as buying insurance on your mew BMW…
For directional options I buy a Delta 70 option. I vaguely recall a TastyTrade market measure or a John Carter video which proved that it provided the best return on capital. If I’m buying a directional option spread I sell the Delta 70 option call and buy the option one or two strikes lower depending on option availability of the lower strike.
$SHOP…you were speculating and have a good profit.
But to exercise, you are increasing your capital risk.
Unless you have real conviction about more upside, or believe the stock is a long-term core holding, I would cash out the options and put most of the proceeds into something, like, say, AIG or Berkshire. You could take a portion of your winnings and roll them over into new strikes and expiries on $SHOP if you have a hankering to let it ride.
Speaking of insurers. Do you have an opinion on Fairfax
or Axis ?
That’s indeed the question, and after following the stock over the past six months I do have an interest in building a position in SHOP for longer-term speculative reasons — mostly because of the non-financial fundamentals of the company (leadership, culture, and vision) that combine well with the very high top-line growth. I don’t think 6-month options are as compelling now, premiums are far higher than when I bought options. The real risk for me is believing too much in the story before it hits the financials, which is why I would keep it a small position but move from an extremely time-sensitive options position to a equity stake that I can allow to fluctuate much more. That’s my thinking, anyway, we’ll see how it goes.
Axis is an excellent and fairly conventional insurance company, I followed them for a while but never owned the shares. They are pretty consistent and pay a dividend and have a very strong underwriting history.
Fairfax has quietly become a very good insurance company over the past decade or so, though they’ve had troubles with weak performance at some of their acquired insurance operations before. I bought shares for the first time last year and have added on, but it is very much a bet on Prem Watsa’s investment acumen and will be much more volatile than most insurers. I think Fairfax is particularly appealing today because the price is depressed a bit due to bad macro postitioning and a major acquisition.
Thanks Travis.
Well , if you believe in $SHOP you got a great cushion at the get-go.
Looking to add some insurance…BRK-B, Axis, AIG and Fairfax on my radar.
Would fairfax have any Canadian taxes or fees if purchased in US.
what is the name of the stock pushed by Motley fool as AI that featured a head with the facial features intact and the rest of the the head and background made of pieces coming together . Other clues were the CEO of ARK said it would create 17 Trillion dollars or be the size of 35 Amazons and Mark Cuban of Shark Tank claiming it will make the worlds first Triilionaire. Thanks