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$OXY is the Best Oil stock + Dividend. Warren Buffett Literally YOLO’d Over $1 Billion+ Dollars. Fun Fact: He actually never sells. Literally his shares = Support = No Hedge Funds can Short his Support because he got a Billion Dollar worth of Shares holding forever💎🦍
1. I think KO could be good if you are looking to preserve capital. I do not foresee any meaningful growth in the future and if you are young and fresh on investing there are probably better options out there. 2. Agree. 3. I think tesla will at some point be the next Netflix on EV, it has had a decent lead on the market for the last years, but as soon as competition picks up the race I'm not sure how they will fare against it, and also I'm not sure how well Mr. Elon can run it in the future. I believe he has only been competing with himself in the past, but that may not translate into EPS.
KO has been a BRK stock for years, I am going to say this without knowing anything, except what you said about people drinking coke, i am addicted to drinking it, but the high fructose is not healthy, and although it is a universal flavor, at some point, people may migrate away, but what is the growth?
In 2021 GOOG reported $75B in earnings. It deducted $16B for the cost of stock based comp (employee stock options), but the actual cost of buybacks to cover those options was $52B. So actual earnings were overstated by nearly 100%. And KO doesn't hand out employee stock options like candy.
The question is why to do it? Everyone knows the stock markets will be higher in 5 and 10 years from now. Just hold forever as Warren Buffet and its a guarantee win. Buffet didnt seel "his bags" in KO and other stocks every time price was falling. He kept it for the long run and was rewarded with a status of billionaire.
Explain how a long call in KO in a bear market with unchanged fundamentals, and KO having 50% IVP was a good trade. Your DD that I read was leaps offer leverage even when OTM, and I agree Your choice in product and strategy is what's dogshit, not your understanding of a LEAP and basic option greeks
lol more or less, yes that’s been my experience in driving many different makes and models of EVs so far. Including super car versions. They’re still fun in terms of torque ratio and sticking you to the seat feel. But a lot is lost in intrinsic driving experience found in high horsepower ICEs with their engine vibration and screaming sound. Even my stage 3 meth injected KO4 VW GTI is more fun to drive than the Rimac C Two I got to drive. And my GTI is only ~500hp.
I agree. If you read the comments you will see they are incredibly superficial and full of parroting of talking points and keywords. Basically pumping the thing like a shitcoin. It’s just trendy now to go for value and dividends, so you see the sheep rush into WM, KO, CAT etc at all time highs
If KO happened to go down you wouldn't have even posted. Everything about your strategy had negative edge except your alleged intuition on KO's move and your confidence it would overcome that. And you were correct, of course, because if you had not been there would have been no post.
everything i’ve bought is negative i swear like only thing im positive in is fucking KO like 4 shares at an average price of like $55 making like $22 😂😂 im down 42% overall. I been red since march 2021 i got to eventually see big green in the next 3-5 years. Every day i get a better price i just have to cry and smile at least i was green today up $237. Down $3,524 though i’m an expert at holding, just waiting for the massive gains. One day i’ll wake up and my stock will be in the daily movers *UP 9000% click sell to retire now* Soon™️
i've only gotten into selling CC about 2 months ago and has been doing quite well. i have missed out on some extra money by having some called, but that was always the plan. it is my set strike for amount of profit i am happy to walk away with. Holding stocks would be the same scenario but the CC give me money for holding. I never sell calls below my stock value price. ideally i would reinvest as you said, but I took out a $15k loan, and use my calls to pay the montly payments. Stocks i have used so far are AAPL, AMZN, KO, TMUS
You're missing the point. An OTM LEAP is *extremely* high risk. You are *very* exposed to small changes in volatility as I illustrated, liquidity is often an issue, meaning you may not be able to sell for the price that gives you your 10% return (instead getting a fill at a potential loss), and delta is very low meaning that you need a big move in the underlying and/or an extremely high win rate. Assuming that one can make 10% per week with anything like this "strategy" is pure fantasy. Buying shorter dated options is not necessarily risky as long as you don't buy OTM options. Your thesis should have a projected timeframe. Let's say that's 2-4 weeks on KO for a $5 move (within 1SD, so it's within 68% probability). The tightest you should go with an option under that assumption is an Aug19 contract. You could choose Sep16 or even Nov18 if you want more wiggle room, but it gets more expensive so you find a safe balance. Now let's compare scenarios. We'll assume an exit on 22 July if KO reaches 66.15. Let's assume IV drops by 5% in line with market volatility also falling. 1. **Jan'24 72.5 Call** (deep OTM LEAP), bought today at $2.82/share ($282 total). On 22 July, with IV down 5%, KO at 66.15: Premium is now $3.05. An 8% return, not accounting for difficulty selling. With a high vega, even another 1% decline in IV, which happens all the time, will obliterate this return. 2. **Aug19'22 60 Call** (ITM, 58 days till expiry), bought today at $3.25/share ($325 total). On 22 July, with IV down 5%, KO at 66.15: Premium is now $6.26. **A 93% return**. Vega and Theta are negligible at the target price, representing about $0.80 variance in the premium, meaning that the return is not going to vary by much if IV falls or the trade takes longer. So, you can see that, in fact, shorter dated ITM options are not riskier as long as you have a timeframe in your trade thesis and you give yourself sufficient buffer.
/r/dividends: *Guy with 10 million dollar portfolio*: "Check out my 1K monthly dividends" (conveniently hides portfolio size) *19 year old with 200 dollars invested across 38 individual stocks*: "I made 62 cents this year, what do you think?" *Fellow /r/dividend investors with their encouraging attitude*: "Keep it up! Soon you'll hit 83 cents each month." *confused yield chaser*: "This shipping stock has a 45% yield, this is a screaming buy" *dividence relevance theorists*: "I love earning my free money doing absolutely nothing. Can't believe people go for hype stocks like Goog and not true value like KO and IBM." /r/valueinvesting: - "This tootsie pop company trades at 0.02 price/book value. Yeah they are in a country undergoing civil war and are under constant threat of nationalization but it's priced in. Deep value play." - "What do you mean telegraph companies are boomer stock? Look at that PE ratio!" - "Imagine paying 20 times earnings for a shit company like AMD. I'll give it a look when it trades down to $18 dollars a share, it's historical price." - "Any thoughts on Gazprom? Russian stocks are the best priced they've been in years. What war?"
If KO goes down 5% per week for a few weeks, or terrible earnings or other bad news event causes a large drop over a couple days, you will then be the owner of a way out the money contract. You may not be down 100%, but you can easily be down 90% in a very short amount of time. This is also a dividend paying stock, so you have inherent headwinds from the price adjustments. Also, being the strike would be an all time high, you may find issues with liquidity, especially if the stock moves against you. I have nothing wrong with throwing $200 at a long dated contract, but you can’t guarantee you’ll make 100% profit. You’re acting like you invented options trading, but you clearly have little experience and shouldn’t be lecturing anyone on trading options, even at a basic level. I wish you luck and introspection.
Your talking about Vega on KO options. It is actually pretty stable. OP is right to omit it. Kind of looks like you are just trying to find things wrong with his trading because you are losing money daily in your "diversified" and "balanced" portfolio. The real tavesty here is all these people thinking they should be applying modern portfolio theory to their tiny little investment accounts.
>Basically: Your contract doesnt need to go in the money to be profitable. Thats what I assume his takeaway is. Thats kind of a moot point though, isn't it? I mean, he bought the option OTM for some positive value, so of course he can sell it OTM for some positive value (which may be higher). However, at the end of the day, the price of an option is the discounted (risk-neutral) expected value of the payoff at expiration. So if OP's strawman saying > "your strategy is shit , you won’t make a profit , Coca Cola will never hit 72$ by 2024!" was in fact correct (as in 0 probability KO > 72$ at expiry), then the option would indeed be worthless.
let's get **a few things** clear... 1) there's no $72 KO strike, there is however a 72.5 strike 2) lecturing about greeks and **NOT** mentioning VEGA on a 575 DTE expiry? Really? That's the biggest greek to discuss, NOT theta, if you are long long-dated options you have low theta and high vega, which changes near expiry 3) Options do not have leverage, they have optionality. They are a convex product. If you do not understand this, then please don't lecture and opine from a point of knowledge, it is misleading. 4) "just depends on your prediction and expected moves" no it depends on what actually happens and for an OTM option that has very little intrinsic value it the last thing I would call this trade is smart. There are a lot of factor and greeks are **dynamic** depending on many factors, that are constantly changing, your vega risk, theta risk, deltas all change. You DO NOT control 26 shares in leverage for 40 cents! As u/systemgc pointed out, you risked $200, apparently, and was thrilled with a 25$ profit? Commissions, Slippage, execution risk should be mentioned, do you not see the concavity and risk mgmnt here is **not** favorable? You are free to trade as you want, but be careful about misleading others with your framing
Theta is not really relevant if things quickly move in ones favor . And with a leap they get even more time. Like I said I have a KO leap with 26 delta and 0.40 theta so I’m making 26$ for every 1$ that ko goes up , and I’m losing only 40 cents for holding this option each day. Obviously this can get really nasty if things go down. But with leaps , my point is theta is really irrelevant if the option seller is wrong.
Correct. I’ve followed it fairly close last 6 months to a year. It often takes up to a full month to see maximum returns. KO and oil being prime examples recently. The good news is the ones he gives the kiss of death have never fully recovered so a traditional short would be more profitable than trying to time options. I’m not recommending this though because the one time this could be wrong would be devastating.
Keep holding and DCA. I had luckily sold out of most of my portfolio in early January in hopes of buying a house, however I held off because prices were out of control. Starting to see the beginnings of a housing correction and will reevaluate later this year. In the mean time, I've put about 30k into safe dividend positions and ETFs (TGT, KO, BRK.B, MSFT, VTI, VOO, VYM). In general, investing during bear markets are when you can make the best returns long term, but obviously no one knows where the bottom is. Just keep DCA. In 3 years, I imagine we will be in another bull market. However, general rule of thumb, never invest something you are saving for (like a down payment on a house). Get the down payment saved and invest the excess.
SCV is not a real asset class. How do you define "cheap"? Some ETFs use P/E which is a terrible way to measure cheapness of certain industries. And no I'm not talking just AMZN type stuff but even utility companies rarely screen as "value" on PE measure. Other ETFs use P/B which is a garbage metric for asset light businesses (ie healthcare/software). SCV etfs end up being extremely overweight financials as a result of this. You're basically just tilting to small financials. Forget the Fama french papers or whatever...no practical edge to invest in companies with low PE. Real value investing is hard. You need tp tailorfit the definition of "value" differently depending on industry/comps. Ie "KO might be trading cheaper than Pepsi..why?" I know maybe 2-3 good active funds but they are tax inefficient (only good in a taxable account).
If you want diversification between sectors ABBV is a great one in the pharmaceutical sector. I have been investing bi-weekly in my roth. They've outperformed the whole sector by 20% last time I checked. Other than that KO has always been a solid choice to have in any dividend account. I also have been eyeing WM and MMM as other choices im looking to potentially add to my roth as well. (I made my roth basically only a dividend/etf account, easier for me to pay attention to)
That is correct and incorrect. Within an ETF that is also an Index, like SPY, the weighting will play a huge role in creating offsetting movements within the fund. Just because the S&P is at 3679, does not mean SPY will be at $367.90. I may be two points off in either direction. The SPY is not weighted equal to the S&P, IWN is not weighted the same as the Russel and so on. So you are 100 on the ETF reacting as the stock in the basket moves, the weighting is more a factor in the way it moves. Also BRK is structured nothing like an ETF in regards to the fact that BRK ( A or B) exist solely for the reinvestment of dividends. For example, the dividend from KO produces 300x in dividends than the cost of the original underlying position. The BRK model is not proffit through growth in the overall market or sector , but growth and returns through reinvestment.
A part from the usual callouts (TSLA, SQ, PYPL, SHOP, TTD, so on and so forth) I’mma mix it up a bit and bring to your attention that Coca-Cola (KO) is near its ATH, PE in the high twenties. Waste Management (WM) same. Even PG. They’re all hella expensive. I guess everyone’s valuing *the moat* very much