Author Topic: What are you buying today?  (Read 1737043 times)

BG2008

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Re: What are you buying today?
« Reply #3290 on: October 10, 2018, 08:01:41 AM »
Boiler,

Can you share what happened in 2008/2009?  I guess you got put to on a lot of positions?


BG2008

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Re: What are you buying today?
« Reply #3291 on: October 10, 2018, 08:02:34 AM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

boilermaker75

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Re: What are you buying today?
« Reply #3292 on: October 10, 2018, 08:11:47 AM »
Boiler,

Can you share what happened in 2008/2009?  I guess you got put to on a lot of positions?

I was. I had positions in BRKB, BA, WFC, BAC, ADP, JNJ, SBUX, PG, MMM, ITW, BDK, and NKE that were below the prices at which I was put to. I held till they came back. I never went on margin in the 2008/2009 time frame. It was after the market started coming back that I got aggressive writing puts and I got slightly on margin a couple of times.

The only ones I still own are BRKB, WFC, and BAC, which are my three largest holdings with BRKB being about 40% of my portfolio.

boilermaker75

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Re: What are you buying today?
« Reply #3293 on: October 10, 2018, 08:13:07 AM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

The wait part is the same for writing puts or buying positions outright. It is always better waiting for lower prices!

John Hjorth

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Re: What are you buying today?
« Reply #3294 on: October 10, 2018, 01:08:24 PM »
Valium.

Decided to add a bit to BAM today instead - not sure if doing like npk would have been better.
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BG2008

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Re: What are you buying today?
« Reply #3295 on: October 10, 2018, 01:19:24 PM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

The wait part is the same for writing puts or buying positions outright. It is always better waiting for lower prices!

What about the premiums that you collected while you wait versus the lower prices that you would've got??

boilermaker75

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Re: What are you buying today?
« Reply #3296 on: October 10, 2018, 01:44:06 PM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

The wait part is the same for writing puts or buying positions outright. It is always better waiting for lower prices!

What about the premiums that you collected while you wait versus the lower prices that you would've got??

I would not have gotten lower prices. Once I determine where I want to buy a stock it doesn't matter if I write a put at that strike price or put a limit order to buy the stock at that strike price. I own the stock either way at about the same basis.

Edit: I didn't know the market was going lower. I was getting put to at prices that I thought were good values, which they eventually were. So if I was going to buy the stock through a limit order I would have done it at the same price as I was being put to.
« Last Edit: October 10, 2018, 01:54:35 PM by boilermaker75 »

BG2008

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Re: What are you buying today?
« Reply #3297 on: October 10, 2018, 02:05:47 PM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

The wait part is the same for writing puts or buying positions outright. It is always better waiting for lower prices!

What about the premiums that you collected while you wait versus the lower prices that you would've got??

I would not have gotten lower prices. Once I determine where I want to buy a stock it doesn't matter if I write a put at that strike price or put a limit order to buy the stock at that strike price. I own the stock either way at about the same basis.

Edit: I didn't know the market was going lower. I was getting put to at prices that I thought were good values, which they eventually were. So if I was going to buy the stock through a limit order I would have done it at the same price as I was being put to.

There was a fund that blew up around the 2008/2009 time frame.  I think the key difference between you and that fund is that you viewed your position size as the amount that you would be put to as the total margin was only 25% at its peak.  He had written puts that were 2-3x his fund's exposure.  When he got put to in 2008/2009 and the positions subsequently decline, he was basically carried out on a stretcher.   

boilermaker75

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Re: What are you buying today?
« Reply #3298 on: October 10, 2018, 03:02:49 PM »
Any comments on how things would have worked out differently if you were to hold cash and waited for lower prices than the shares you were put to?

The wait part is the same for writing puts or buying positions outright. It is always better waiting for lower prices!

What about the premiums that you collected while you wait versus the lower prices that you would've got??

I would not have gotten lower prices. Once I determine where I want to buy a stock it doesn't matter if I write a put at that strike price or put a limit order to buy the stock at that strike price. I own the stock either way at about the same basis.

Edit: I didn't know the market was going lower. I was getting put to at prices that I thought were good values, which they eventually were. So if I was going to buy the stock through a limit order I would have done it at the same price as I was being put to.

There was a fund that blew up around the 2008/2009 time frame.  I think the key difference between you and that fund is that you viewed your position size as the amount that you would be put to as the total margin was only 25% at its peak.  He had written puts that were 2-3x his fund's exposure.  When he got put to in 2008/2009 and the positions subsequently decline, he was basically carried out on a stretcher.

Even though my exposure was 25%, I was never more than about 5% on margin and by writing covered calls I was able to get off of margin.

Spekulatius

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Re: What are you buying today?
« Reply #3299 on: October 10, 2018, 03:35:42 PM »
On the topic of this Thread, I bought some FDX and TOL today. I also added a bit of NXPI. TOL trades for 1.05x tangible book, If I see this correctly. I think that actually lower than during the financial crisis when they were making losses.

I am also tempted buying some FCAU or EXOR Holding stock.
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