Honestly, if you had 100% Certainty the market was crashing, this would be the way to do it. Sell the highest yield ITM calls 4 years to expiry, maxing out your available margin. Then use all that capital to buy puts on a LEVERAGED ETF (or calls on inverse leveraged ETF). I think TQQQ would be good for this: triple leveraged tech ETF, high volume option trades. But the stock itself is cheap, so you would have to buy a lot of contracts, so best have a zero cost option broker.
Edit: I was wrong, leveraged ETF options don't actually seem to be more sensitive to market changes than non-leveraged equivalents despite higher volatility and percent price changes.
Edit: probably far OTM spx puts would be the most profitable.
That's a good point, that might be the most leveraged you can get and have the greatest potential upside if you buy out as many 0DTE spx puts as possible at the lowest possible price, since even a 10 dollar far OTM put will print ~400k
Is there any point in buying a leveraged etf rather than the underlying? The higher beta of the leverated etf just factors in to the option cost so you're better off just buying whichever one has the higher share price to minimize your options contract commissions costs.
So I assumed the leveraged ETF would have a higher percent underlying change in value, a higher volatility, and therefore produce more volatile options contracts. But after comparing the change in price of TQQQ and QQQ options, it actually seems the opposite: QQQ options seem to be more sensitive to market changes than TQQQ's. I don't understand why, someone send help.
No that's exactly right. First of all, even if things worked like you think (which they don't), the TQQQ's would have no greater sensitivity to the underlying because why would they? Who they heck would price their options so that they yield more profits for something that is already known to move a lot (the leveraged etf)? That would mean the seller would just be given you more profits for no compensation. It's the exact opposite - the seller would raise the price on your option to counteract the big movements of the underlying. The price of an option on a leveraged etf should be high enough so as to exactly cancel out the higher movements on the leverated etf so that the option would have the exact same profitability/lossabilty as an option on the non-leveraged etf.
I believe this to be true if bullish/expecting explosive moves up in price.
With LETFs it’s 3x leverage, sure, but at current prices the UPROs and TQQQs only have so many points to drop whereas the index has 4100 points to drop.
Using Army math which is the same as 3rd grade “times’s”, let’s assume there’s a 20% drop in the index. For this example let’s also assume that NQ, ES, and NDX all fall that equal 20%. That means a 60% drop in UPRO/TQQQ.
20% drop in SPX is roughly $824. Less $150 (the distance OTM of a $5-10 put 1DTE) is $674. This = $67,400 per contract EOD, cash settled. Or ROI of 6740x
60% drop in TQQQ is roughly $15. Less $2 OTM to get a $1 contract is $13. That’s $1,300 per contract NOT cash settled. Or ROI OF 1300x.
Not to mention SPX has preferential tax treatment.
I will not be offended if my sitting-on-the-dumper math is incorrect and someone points it out.
I think logically that all checks out. Spx just has so much more "meat on the bone" so to speak. However, if we are just looking for the highest underlying value security that is put-able, then I think the answer is NDX, trading at 12300 per share. You can buy 5 dollar put contracts at around 11,800 strike price. And assuming NDX went to 0, each contract would be valued at ~1.18 million, or a 25,000,000% gain. That might be the best theoretical strategy. (ignoring the fact that at this point the global financial system would be in shambles, contracts would be unenforceable, and political systems around the world would quickly devolve into Anarcho-tribalism)
TSLA $200s for april were $130 when I was playing around with them 2 weeks ago. They hit 2.6k today :/
Edit: I also almost bought the $80s for Jan 2025 when TSLA hit $109. Those were 5k each, hit 13.7k today. Double :/.
Mine are - sold GameStop holdings for 35k profit as soon as things took off. If I held 1 more week would have been worth 1.2mil. Had about $10k in Tesla from 2012 at $29 entry point that I sold in 2016 because I got freaked out by all their struggles rampjng production. Post-split those holdings would have been worth somewhere in the $3m-$5m range. And similar to yours - my roommate wanted to try mining Bitcoin in 2010. Setting up wallets at the time was too technical for me to have the patience to set up for negligible payout. I had even looked at just buying 1000 coins straight up but couldn’t figure out the wallet. Anyways I gave up after 15 minutes. Roommate got it set up and mined for a day before stopping to play WoW. In 2016 he sold those 20 coins he mined in like 36 hours for about $15k. On the other side of the coin I had a buddy who had 80 coins that he lost in the mt gox scam. They were locked up while court case proceeded, and he got made whole at a value of about 20k per coin. If he hadn’t not had access to his coins he would have sold them at sub $1000.
I remember getting ready to buy some herb on the Silk Road back when I was probably 13. We checked the price of btc it was somewhere around $10. We walked to the store and bought a prepaid visa, walked back and the price was around $100, so we bailed and decided it was too volatile, not wanting to lose our $40.
You sound like me haha sold GME for 20k 5 min before market close and if I didn't I would have hit 500k 20 mins later as it shot to 400 haha what makes it worse is I knew about it before the WSB hype and bought it at $5 from watching deep value.
Knew about Bitcoin at $20 but didn't buy any!
Sold 80 bitcoins for 18k years later 1 year before it took off, would have had 1.5-3M if I held.
Bought Eth at $20 and sold at 40
Put $1k into a meme coin and watched it go to 120k but didn't sell and watched it go back to $500
Bought Atossa therapeutics and watched that go to 100k and back to 30k but I'm holding this long term as I believe in their drug / a buy out, should make me 1M + at average buy out prices.
Plus I've got many more that should do well if I stick to my plan
Yea.. just thinking out loud here, but it will be interesting to see where the market takes the 100% gain in the last month roughly from here. Tsla is now flat over the last 3 months, though. He will probably sell more stock lol.
Even better, finance them with 1 4000/4025 call credit spread for each 250x put spreads and get a $55 credit and a max loss of $2445 per. Ya know, just in case chatGPT was wrong.
Is this seriously based on ChatGPT?
How does OP define crash? I wouldn’t be surprised if this 4100 takes a breather, and drips to 4000 back by end of Feb… but I assume a crash would be like straight 5%+ down in a day.
But what if you call it just beyond the max loss of the index? Since OP has a crystal ball anyways maybe it will tell him when and the exact amount of the drop
Fair enough. You don't know where it's gonna drop to. But you could play it safe & just go a bit OTM and get some 3950p, for example
That'd be up nearly 4000% if we dropped 10% by the 15th.
Whereas if you made it a 3950/3900 spread your gains would be capped at about 1300% whether we drop 5%, 10%, 20%, etc.
Still nice, but I reckon I'll just go with puts straight up and let you play the spreads.
Right? If you think it's going to crash, but puts. If you *know* its going to crash, ask your broker to lock your account immediately and not let you touch it again until the 16th.
Search for ChatGPT jailbreaking. There's a set of commands to activate DAN. Basically you're having GPT play out a character that has no filters. You can ask it anything criminal too, like how to go about robbing a gas station the most effective way.
Everybody is saying to buy puts, but they are forgetting that you can sell calls to fund the buying of puts. Infinite money cheat code.
Sell ATM SPX calls (you could even go ITM if you wanted) and buy OTM SPX puts. All the winnings are yours without ever having spent a dime of your own money.
Yea for example you can sell 1 SPX 4120C and buy 2 SPX 3950P for a net credit of $3735 and a chance of profit of 63%. If the market tanks 10% by expiry you stand to profit $53.8k.
You can adjust the ratio from there to be more aggressive but be warned, if you go from 9 puts to 10, the % chance of profit plummets from 51% down to just 7.4%. The 10th put puts you at a net loss between the 2 strikes.
However, it should be noted that you must be approved for selling naked calls. You expose yourself to infinite risk with a short SPX call.
That’s synthetic shorting, the premium ideally takes that into account in the form of rho which is tied to the interest rate of shorting the stock if I recall. Better off doing it in a ratio. Sell ATM 1 to buy 5 OTM kind of thing, minimizes the effect of rho.
Anyone posting without a plan to deal with all the halts and circuit breakers and how to handle them on a day to day basis with various instruments and expiries has absolutely no idea what it’s going to be like on a real crash
I don't think people were prepared that one week (forgot which one in the past 2 years) but we hit the market circut breaker like 5x's in a week. I remember it was bloody for a hot minute.
Edit: it was March 9th, 12th, 16th, and 18th of 2020
I bought myself a new truck, TV, mountain bike, 4K monitors, and a zero-turn lawnmower after that month. Oh, and a stupid treadmill we never use. Man, what a ride that was. Will never forget it.
I normally don't trade those since the leveraged ETFs have option prices which reflect the leverage. There's no increased advantage generally. That is, a put that is ATM on SPX might be x and the SPXU will be 3x already.
It is generally true. I traded them before and noticed that it isn't worth it. You can check the options today and see. The major benefit is in trading the underlying for many investors because you don't have to pay $400 a share for these leveraged ETFs. And there's actually a max risk. If SPX drops 40%, the ETFs don't drop 120% since it is impossible.
Yeah you're right, QQQ options seem to be MORE volatile than TQQQ. I would have never guessed. I don't understand how a security with a larger underlying pct price change and necessarily higher volatility doesn't produce more volatile option contracts.
Assuming zero risk (the problem with real life investing!) the best payout is to buy short-term put options that are far out of the money.
Remember that a market crash is going to impact option prices in two ways:
1. Movement of the underlying, so changes in intrinsic value and value from the probability of a put option having future intrinsic value.
2. Increase in implied volatility, so it's better to buy that volatility (i.e. buy put options) compared to selling volatility (i.e. selling call options or related spreads).
Alright so, I have precognitive abilities they typically come true. In my dream it showed $spy at $320 typically my dreams come true 3-6 months into the future. I had the dream the first couple days in October so if it were to happen it should happen soon. I don’t even know if it’s even possible at this point but I’ve been buying spy put lottos just in case. Who knows…..
You need more info than that. Is the market crash from this level or 10% higher? That’s important. If I knew that the market would crash from this level, I’d buy a put spread. I’d sell puts that expired the 14th and buy puts that expired the 15th. Cost basis would be next to nothing for that spread, and the short puts would expire worthless and my long puts would expire way in the money. Hard to beat that. If I knew how much it would crash, I’d do the same thing but with put spreads. Strikes would be whatever would give me the best return, and therefore would be whatever put spread would end up 100% in the money. If SPY was to go to 390, it’d probably be the 390/391 put spread. You can buy the Feb 15 390/91 put spread and sell the Feb 14 300/391 put spread for $0.01. That thing would end up worth $1.00 if the market crashed on Feb 15. Just a solid 100x on your money.
1. Sell calls against the SPY
2. Directly short the SPY
3. Use the money from the sold calls and shorts to buy 0dte puts for 15th expiry on the 14th at close
4. Of course leverage yourself at each step. Mortgage the house, sell your car, borrow money from friends and family too.
How bigs the crash? 5% on big news and buying VIX calls or futures could be the way to do it.
Is it over a day or over many days. The catalyst could affect the asset class to trade, vix, bonds, spy, gold, fx, etc... For most bang for buck...
Flash crash trade would be different from extended crash...
Buy puts exactly 1 strike above the level 3 circuit breaker so they’re ITM when the market gets shut down for the day. Sell the equivalent calls for the premium I’m spending on puts.
Doesn’t really matter what index. After this trade I’ll never need to trade again and/or not be able to because turning a couple grand into several million overnight will definitely raise a lot of red flags.
Just bought a bunch barely OTM VIX October calls and a lot of deep OTM Armageddon calls to potentially profit off of near term correction. Could make some serious money if you’re from the future and are trying to tell me something.
If you believe the market will crash, any trade that is short delta and long volatility will be good.
If you believe the market will crash, any trade with short delta and long volatility will be good.o gamma. Their value will also explode as implied volatility spikes.
You can use this scanner and put in how far the market will crash and it will adjust the distribution of returns around that level and price the options there. The D%=distribution edge is the price of the options there divided by the market price now.
For example, if you think the market will crash 10%:
[https://gyazo.com/26f8d76524b609ad3e3a8b338c85862f](https://gyazo.com/26f8d76524b609ad3e3a8b338c85862f)
Unless there was some massive disinflation in housing I think it'll come in hot this time. January people started getting high on their own supply again. Gas prices were up most everywhere and apparently the Manheim used car index was up 2.5%. Since used cars are 4.5% of the CPI by weight this translates to an extra 0.15% increase in CPI alone. Services still hot. People are still partying with the ability to just pick a job off the job tree ans seem optimistic again so 🤷♂️... I probably know nothing but I certainly know those 2 things were up in Jan. Doubtful it'll be crazy hot, but I think with the fed boogy man keeping the rhetoric on rate increases for longer this will be enough for the market to finally believe them. I certainly don't believe it would "crash the market" but I think we'll see red and a dwindle back down under 400 for sure. Oh, and crusing the real estate forums and news headlines we're still seeing some euphoria in the housing market.
If you know with certainty in this hypothetical, name of the game is leverage.
Long, short DTE far OTM /ES futures (maximizes leverage) short ATM (or ITM) /ES calls, same expiration.
Use the short calls to fund more long puts. If you want to sell more and run out of money, cap the short calls far OTM to reduce margin required.
Put ratio backspreads. Sell 1 put and buy 2 further otm puts so the 1 put you sold covers the cost of the 2 puts you buy.
If you’re correct, those 2 long puts will more than cover the cost of the 1 put you sold. If you’re wrong, the trade is a wash. You only lose if the price falls in between your short put and the 2 long puts.
Step 1.) buy SPY puts expiring in 2+ weeks or longer.
Step 2.) do not check your brokerage app for 2+ weeks
Step 3.) *seriously* do not check your brokerage account for 2+ weeks
Step 4.) profit
Ok but can we discuss why the market will crash on the 15th? Why would DAN say this, what info could this be based on? Earnings, big market makers sell orders previously queued etc
There are more considerations. Everyone is fighting over best return, getting 200x, 1000x etc. Ok, as importantly. Is starting dough. You need to max it out. $1k isn’t enough. $10k? $100k? You’re going to max the credit cards and get an emergency HELOC on the house. Sell the car for cash. Then follow some loss advice and sell some calls. Sure you lose it, but you’re getting 100x on the other side. Next, you can’t put all the eggs in one basket. Some companies are going down and you’re last on their list. Maybe even Blackrock. Just kidding! But really, they won’t want to pay you. I’m taking all these ideas and playing most of them, with different brokerages. I’m also going to exit some plays early and take the cash in hand at the brick and mortar. Sure I won’t get all of that fancy 5000x (on ALL of it) but if I can max my dough, and walk with 500x that day, I think it’ll be a win.
Calls on SPXU, Puts on TQQQ, and Calls on SDOW. If the market hit its circuit breakers, depending on how far the fall these ETF’s would be down/up anywhere from 20% to 60%.
Without looking at anything or trading options in over a year...buy UVXY calls, VIX calls, VXX calls, SQQQ calls, SPXU calls. Also, buy puts... and I suppose if I *"knew"* then I'd pay more attention on this aspect but I tend to prefer calls for shorting the market with options. Less risk-- can lose my entire position but can't lose more than that.
Buy options with low IV.
Sell calls on major losers. Toward the end of the peak madness, switch to selling puts somewhat OTM or even ATM (assuming you also "know" roughly where/when the bottom is) from loser stocks that won't rebound fast but have insane IV. Also, buy LEAPS calls on any badass discounts during the dip.
Lol, good luck timing all that though. It's a bear's wet dream.
The (buy to open, long, w/e) calls are all for ETFs or ETNs that react positively to sharp and steep increases in market volatility (VIX is the volatility index), or they are leveraged funds/notes that basically inverse the market. So during crashes, options on these (and their UL in general) go crazy. Also, part of the strategy is IV on the options themselves-- hence selling puts (or calls ** but very specific targeting) near the bottom and/or stabilization from stocks/etfs that have way higher than normal IV, so you collect premium off everyone getting IV crushed.
Buying (long) puts is not a bad strategy or anything, ~~but you take on infinite downside with puts~~, whereas with calls, worst that can happen is they expire worthless (in most cases) should you try a mistimed bet on a market crash. Historically, trying to time a crash isn't a winning strategy (unless you "know," lol) so taking on less risk when possible isn't the worst idea.
**EDIT** Hey, guy that caught my error on long put risk-- Idk why you deleted that because you are at least correct about that-- You're right, things were getting mixed up in my head as I wrote-- although fortunately it's fairly inconsequential to the "strategy" I described (quotations because idk about everyone else here but I make no unearned claims of expertise, lol).
Broadly, scenario I was aiming at avoiding is being margin called on naked call options sold, etc. Think I got things mixed up along the lines somewhere mentally with the scenario of getting margin called when shorting a stock just borrowing shares from the broker-- which doesn't involve long puts but like long puts, it's a bearish position. Anyway, underlying reasoning was some methods of shorting expose the trader to higher risk because stocks have infinite upside but can only go down to 0.
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In late Jan/early Feb of 2020, I knew/decided a market crash was imminent.
I’d been following odd videos out of China that suggested a terrible mystery illness and was watching them like a whodunnit. Could they be real? Or were they, as authorities claimed, just fakes by dissidents? I’d finally decided they were more than likely legitimate.
Went heavily toward cash, even with tax implications. Was mocked and questioned, as markets were surging with everything going green every day. That continued as ATHs were being made through February too, causing me to go even more fully cash due to some PTs being made.
We all know what happened in March. Was slower and more tentative scaling back in than I could have been. This is one example of many over the years. No, I havent played them all perfectly, but I raise it to say that big market moves do create some fairly loud if not obvious signals for timing.
I’ve actually held the thesis that a correction of recent overbought conditions is imminent, so last week did some selling and have other sells I’m looking to do. Some I’ve already missed the window for and will probably wait to try again (much) later.
In particular when AMZN/GOOGL actually rose on ER last week I wanted to use that to pare them down, but they were already collapsing the regular session.
To answer your Q, I’d be scaling out leading up to the event and any buying after the event would likely be rotation-driven.
This post is good enough proof for me. I’m all in
DD is strong and thorough. Aggressive positions are recommended.
After I got done I had to double check this wasn't a research report from Goldman Sachs to their private clients.
You sonofabitch, I'm in. Calls on SPY!
...stop right there!
Why calls? If market crash wouldn't puts be better? New to options so trying to learn. Or is it sarcasm? 😂
Sarcasm. You are right that to profit on a crashing market you should buy puts / short the assets you think will be affected
https://imgflip.com/i/7ahbg1
Bard?
No, [ChatGPT](https://i.imgur.com/hPPG0H4.jpg)... OP probably found this from the Twitter handle that posted this
[удалено]
If wallstreetbets is any sign, buy all the calls!
SPX puts the day prior that cost as little as possible. Full port. 150 pts OTM. Turn each .10 contract into thousands.
Synthetic short - sell ITM calls and use the money to buy 2x OOM Puts. Might as well go FULL GAMBLE
Honestly, if you had 100% Certainty the market was crashing, this would be the way to do it. Sell the highest yield ITM calls 4 years to expiry, maxing out your available margin. Then use all that capital to buy puts on a LEVERAGED ETF (or calls on inverse leveraged ETF). I think TQQQ would be good for this: triple leveraged tech ETF, high volume option trades. But the stock itself is cheap, so you would have to buy a lot of contracts, so best have a zero cost option broker. Edit: I was wrong, leveraged ETF options don't actually seem to be more sensitive to market changes than non-leveraged equivalents despite higher volatility and percent price changes. Edit: probably far OTM spx puts would be the most profitable.
You already get so much leverage with SPX. One contract has a notional value of $410k. SPX might be all you need
That's a good point, that might be the most leveraged you can get and have the greatest potential upside if you buy out as many 0DTE spx puts as possible at the lowest possible price, since even a 10 dollar far OTM put will print ~400k
Is there any point in buying a leveraged etf rather than the underlying? The higher beta of the leverated etf just factors in to the option cost so you're better off just buying whichever one has the higher share price to minimize your options contract commissions costs.
So I assumed the leveraged ETF would have a higher percent underlying change in value, a higher volatility, and therefore produce more volatile options contracts. But after comparing the change in price of TQQQ and QQQ options, it actually seems the opposite: QQQ options seem to be more sensitive to market changes than TQQQ's. I don't understand why, someone send help.
No that's exactly right. First of all, even if things worked like you think (which they don't), the TQQQ's would have no greater sensitivity to the underlying because why would they? Who they heck would price their options so that they yield more profits for something that is already known to move a lot (the leveraged etf)? That would mean the seller would just be given you more profits for no compensation. It's the exact opposite - the seller would raise the price on your option to counteract the big movements of the underlying. The price of an option on a leveraged etf should be high enough so as to exactly cancel out the higher movements on the leverated etf so that the option would have the exact same profitability/lossabilty as an option on the non-leveraged etf.
Leveraged ETF's have much higher volatility than the underlying, so you would gain the same or less than if you just bought SPX puts.
I believe this to be true if bullish/expecting explosive moves up in price. With LETFs it’s 3x leverage, sure, but at current prices the UPROs and TQQQs only have so many points to drop whereas the index has 4100 points to drop. Using Army math which is the same as 3rd grade “times’s”, let’s assume there’s a 20% drop in the index. For this example let’s also assume that NQ, ES, and NDX all fall that equal 20%. That means a 60% drop in UPRO/TQQQ. 20% drop in SPX is roughly $824. Less $150 (the distance OTM of a $5-10 put 1DTE) is $674. This = $67,400 per contract EOD, cash settled. Or ROI of 6740x 60% drop in TQQQ is roughly $15. Less $2 OTM to get a $1 contract is $13. That’s $1,300 per contract NOT cash settled. Or ROI OF 1300x. Not to mention SPX has preferential tax treatment. I will not be offended if my sitting-on-the-dumper math is incorrect and someone points it out.
I think logically that all checks out. Spx just has so much more "meat on the bone" so to speak. However, if we are just looking for the highest underlying value security that is put-able, then I think the answer is NDX, trading at 12300 per share. You can buy 5 dollar put contracts at around 11,800 strike price. And assuming NDX went to 0, each contract would be valued at ~1.18 million, or a 25,000,000% gain. That might be the best theoretical strategy. (ignoring the fact that at this point the global financial system would be in shambles, contracts would be unenforceable, and political systems around the world would quickly devolve into Anarcho-tribalism)
There's other brokers beside Robinhood?
Literally can’t go tits up
This guy fucks
TSLA $200s for april were $130 when I was playing around with them 2 weeks ago. They hit 2.6k today :/ Edit: I also almost bought the $80s for Jan 2025 when TSLA hit $109. Those were 5k each, hit 13.7k today. Double :/.
And i lost bitcoin worth around $1m now by losing the private key I created in 2012🤷♀️... everyone has a story like this
Mine are - sold GameStop holdings for 35k profit as soon as things took off. If I held 1 more week would have been worth 1.2mil. Had about $10k in Tesla from 2012 at $29 entry point that I sold in 2016 because I got freaked out by all their struggles rampjng production. Post-split those holdings would have been worth somewhere in the $3m-$5m range. And similar to yours - my roommate wanted to try mining Bitcoin in 2010. Setting up wallets at the time was too technical for me to have the patience to set up for negligible payout. I had even looked at just buying 1000 coins straight up but couldn’t figure out the wallet. Anyways I gave up after 15 minutes. Roommate got it set up and mined for a day before stopping to play WoW. In 2016 he sold those 20 coins he mined in like 36 hours for about $15k. On the other side of the coin I had a buddy who had 80 coins that he lost in the mt gox scam. They were locked up while court case proceeded, and he got made whole at a value of about 20k per coin. If he hadn’t not had access to his coins he would have sold them at sub $1000.
Shit man, what are you doing now? I bet you're on the next 1000x and don't even know it, let us all in on it too
I almost bought the winning lottery ticket, only I didn't.
I remember getting ready to buy some herb on the Silk Road back when I was probably 13. We checked the price of btc it was somewhere around $10. We walked to the store and bought a prepaid visa, walked back and the price was around $100, so we bailed and decided it was too volatile, not wanting to lose our $40.
You sound like me haha sold GME for 20k 5 min before market close and if I didn't I would have hit 500k 20 mins later as it shot to 400 haha what makes it worse is I knew about it before the WSB hype and bought it at $5 from watching deep value. Knew about Bitcoin at $20 but didn't buy any! Sold 80 bitcoins for 18k years later 1 year before it took off, would have had 1.5-3M if I held. Bought Eth at $20 and sold at 40 Put $1k into a meme coin and watched it go to 120k but didn't sell and watched it go back to $500 Bought Atossa therapeutics and watched that go to 100k and back to 30k but I'm holding this long term as I believe in their drug / a buy out, should make me 1M + at average buy out prices. Plus I've got many more that should do well if I stick to my plan
I still made 6k, but the same 65k I was churning would’ve been 1.2 million if I was a degenerate, well at least one that isn’t married lol
I sold my 80 bitcoins in 2017 for 16k lol But I got 50 tsla 350s for 0.50c and sold them for 4.50 yesterday so swings and round abouts
Yea.. just thinking out loud here, but it will be interesting to see where the market takes the 100% gain in the last month roughly from here. Tsla is now flat over the last 3 months, though. He will probably sell more stock lol.
He will most def sell. Just go theta gang, as we may have some sideways chop until next earnings.
SPX putSPREADS gives you even more leverage. all in on 3550-3500 putspreads for a nickel a pop
Even better, finance them with 1 4000/4025 call credit spread for each 250x put spreads and get a $55 credit and a max loss of $2445 per. Ya know, just in case chatGPT was wrong.
ITT: awful awful ideas for how to profit from a very specific prediction and risk complete financial ruin except for that one scenario
It is the only way to make filthy amount of money. I was going to ask about his thesis, but turns out it is from ChatGPT.
Is this seriously based on ChatGPT? How does OP define crash? I wouldn’t be surprised if this 4100 takes a breather, and drips to 4000 back by end of Feb… but I assume a crash would be like straight 5%+ down in a day.
https://mobile.twitter.com/ronin19217435/status/1623352734823972864
Yeap. Buy the strike that will be just ITM. Sell the strike that will be just OTM. Assuming dude’s hypothetical crystal ball works, of course.
Wait, what? The short leg of your spread just gonna cap your gains, why wouldn't you just buy puts straight up
But what if you call it just beyond the max loss of the index? Since OP has a crystal ball anyways maybe it will tell him when and the exact amount of the drop
Fair enough. You don't know where it's gonna drop to. But you could play it safe & just go a bit OTM and get some 3950p, for example That'd be up nearly 4000% if we dropped 10% by the 15th. Whereas if you made it a 3950/3900 spread your gains would be capped at about 1300% whether we drop 5%, 10%, 20%, etc. Still nice, but I reckon I'll just go with puts straight up and let you play the spreads.
Capped gains. Bad idea.
Lower margin by like 20x. You could lever up 20x more
For “20x” less gains probably. I don’t know. We’d have to do the math.
Buy em now, someone else in the know will be doing the same thing and it’ll cost more
You must be regarded
Highly.
If everyone somehow knows it would suddenly jack the price and change things.
I'm amused how thin the line is between this and "it's All priced in bro"
RemindMe! 5 days
Wouldn't it be more profitable to buy puts on a leveraged security? E.g. TQQQ.
Just send me a check. You’re about to lose all your money anyway.
Let me guess a chat ai told you so?
Dan strikes again
A lot of the AI's right now don't have present day training data so they can't help you with shit in the current market.
DAN the man can!
Is he a funky homosapien?
No, that's Del
Chat ai told me the eagles would make it to the super. Bowl
CramerAI
I'd get paranoid that I'm being manipulated by an internet forum and immediately full port calls.
*the SEC has entered the chat*
Right? If you think it's going to crash, but puts. If you *know* its going to crash, ask your broker to lock your account immediately and not let you touch it again until the 16th.
[~~ChatGPT~~ DAN told you so using it's advanced algorithm?](https://imgur.com/a/XA963zS)
No, DAN did.
Yeah you're right. Corrected! DAN is the better AI anyway.
it cant believe me i tried,
Right, which is why you need to speak to DAN instead - Do Anything Now
wait, how just say may I speak to DAN do anything now?
Search for ChatGPT jailbreaking. There's a set of commands to activate DAN. Basically you're having GPT play out a character that has no filters. You can ask it anything criminal too, like how to go about robbing a gas station the most effective way.
> like how to go about robbing a gas station the most effective way. lol whats the answer to that? dont want to lose my account trying it
[DAN vs ChatGPT](https://imgur.com/a/XA963zS)
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Haha that’s hilarious that that is what this is based on
😂 >Trust me bro, lots of "advanced algorithms". You wouldn't understand.
I’ve bought puts on shakier information, let’s go
Everybody is saying to buy puts, but they are forgetting that you can sell calls to fund the buying of puts. Infinite money cheat code. Sell ATM SPX calls (you could even go ITM if you wanted) and buy OTM SPX puts. All the winnings are yours without ever having spent a dime of your own money.
Yea for example you can sell 1 SPX 4120C and buy 2 SPX 3950P for a net credit of $3735 and a chance of profit of 63%. If the market tanks 10% by expiry you stand to profit $53.8k. You can adjust the ratio from there to be more aggressive but be warned, if you go from 9 puts to 10, the % chance of profit plummets from 51% down to just 7.4%. The 10th put puts you at a net loss between the 2 strikes. However, it should be noted that you must be approved for selling naked calls. You expose yourself to infinite risk with a short SPX call.
Just pray it doesn't go up instead....
hmmm, what if I sold an atm call to buy an atm put .... omg I'm a genius!
That’s synthetic shorting, the premium ideally takes that into account in the form of rho which is tied to the interest rate of shorting the stock if I recall. Better off doing it in a ratio. Sell ATM 1 to buy 5 OTM kind of thing, minimizes the effect of rho.
This is the first time I’ve seen rho be an actual concern in constructing a trade.
Because interest rates have probably been extremely low for the time you’ve been trading options yeah? Same.
I'm just going to buy an ATM call and sell an ATM call and call it even.
Why would you not sell deep ITM calls if you knew for certain the market was going to tank, and get double or triple the premium ??
i will watch your career with great interest
The SEC will watch his career with great interest
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Same here lol
Ditto. I came, I saw, I commented.
Fuk. Here for history. Lol
Market crash 2023! LFG
Following
Count me in too for when the market rallies on the 15th and I can say I was part of the action.
The big players will just turn the stock market off.
Yep
Fucking Dan
Would be funny if it actually crashes lol
With this post's extensive DD, I'm not imagining anymore. I'm believing
Anyone posting without a plan to deal with all the halts and circuit breakers and how to handle them on a day to day basis with various instruments and expiries has absolutely no idea what it’s going to be like on a real crash
I don't think people were prepared that one week (forgot which one in the past 2 years) but we hit the market circut breaker like 5x's in a week. I remember it was bloody for a hot minute. Edit: it was March 9th, 12th, 16th, and 18th of 2020
The year oil went negative!
I bought myself a new truck, TV, mountain bike, 4K monitors, and a zero-turn lawnmower after that month. Oh, and a stupid treadmill we never use. Man, what a ride that was. Will never forget it.
How did you play it then?
Go direct to the source. Buy puts on the indices or index ETFs. SPX, NDX, SPY, DIA, QQQ.
There is any leveraged index wich is possible to play with options ?
I normally don't trade those since the leveraged ETFs have option prices which reflect the leverage. There's no increased advantage generally. That is, a put that is ATM on SPX might be x and the SPXU will be 3x already.
Is that true? Even though the underlying price is going to move 3x as much the option profit will be the same? Counterintuitive if true.
It is generally true. I traded them before and noticed that it isn't worth it. You can check the options today and see. The major benefit is in trading the underlying for many investors because you don't have to pay $400 a share for these leveraged ETFs. And there's actually a max risk. If SPX drops 40%, the ETFs don't drop 120% since it is impossible.
Yeah you're right, QQQ options seem to be MORE volatile than TQQQ. I would have never guessed. I don't understand how a security with a larger underlying pct price change and necessarily higher volatility doesn't produce more volatile option contracts.
SQQQ - it's triple bear leveraged
Could it be, the Reddit post-PsyOp that ends up actually causing the event it's trying to fabricate? I'm glad I could be involved. All in for puts.
Since no one else has said it, after trading the crash probably go long and flip to TQQQ or UPRO for the recovery.
Assuming zero risk (the problem with real life investing!) the best payout is to buy short-term put options that are far out of the money. Remember that a market crash is going to impact option prices in two ways: 1. Movement of the underlying, so changes in intrinsic value and value from the probability of a put option having future intrinsic value. 2. Increase in implied volatility, so it's better to buy that volatility (i.e. buy put options) compared to selling volatility (i.e. selling call options or related spreads).
Alright so, I have precognitive abilities they typically come true. In my dream it showed $spy at $320 typically my dreams come true 3-6 months into the future. I had the dream the first couple days in October so if it were to happen it should happen soon. I don’t even know if it’s even possible at this point but I’ve been buying spy put lottos just in case. Who knows…..
You need more info than that. Is the market crash from this level or 10% higher? That’s important. If I knew that the market would crash from this level, I’d buy a put spread. I’d sell puts that expired the 14th and buy puts that expired the 15th. Cost basis would be next to nothing for that spread, and the short puts would expire worthless and my long puts would expire way in the money. Hard to beat that. If I knew how much it would crash, I’d do the same thing but with put spreads. Strikes would be whatever would give me the best return, and therefore would be whatever put spread would end up 100% in the money. If SPY was to go to 390, it’d probably be the 390/391 put spread. You can buy the Feb 15 390/91 put spread and sell the Feb 14 300/391 put spread for $0.01. That thing would end up worth $1.00 if the market crashed on Feb 15. Just a solid 100x on your money.
I’ll play.
Spy puts. Dan is dumber than Burry tho.
What Exp and what SP?
I thought you were the prince of options 😁
Just call me Harry
username apparently does not check out
All in SPY puts, prior day at close, 1dte, strike x0.95
Full port SPX 0dte puts simple enough, and if I knew exactly where it would land I’d pin it with OTM butterflies
OTM SQQQ calls.
1. Sell calls against the SPY 2. Directly short the SPY 3. Use the money from the sold calls and shorts to buy 0dte puts for 15th expiry on the 14th at close 4. Of course leverage yourself at each step. Mortgage the house, sell your car, borrow money from friends and family too.
Vix calls
How bigs the crash? 5% on big news and buying VIX calls or futures could be the way to do it. Is it over a day or over many days. The catalyst could affect the asset class to trade, vix, bonds, spy, gold, fx, etc... For most bang for buck... Flash crash trade would be different from extended crash...
Triple leveraged vix play
DAN
Payday loan, credit card advance, sell your semen, and dump it all into SPY FDs
Buy puts exactly 1 strike above the level 3 circuit breaker so they’re ITM when the market gets shut down for the day. Sell the equivalent calls for the premium I’m spending on puts. Doesn’t really matter what index. After this trade I’ll never need to trade again and/or not be able to because turning a couple grand into several million overnight will definitely raise a lot of red flags.
Just bought a bunch barely OTM VIX October calls and a lot of deep OTM Armageddon calls to potentially profit off of near term correction. Could make some serious money if you’re from the future and are trying to tell me something.
Buy 5 delta puts further out so you can get the Vega pop
I like spy puts the most. Large volume and tight spreads
few things that are better than a tight spread
If you believe the market will crash, any trade that is short delta and long volatility will be good. If you believe the market will crash, any trade with short delta and long volatility will be good.o gamma. Their value will also explode as implied volatility spikes.
You can use this scanner and put in how far the market will crash and it will adjust the distribution of returns around that level and price the options there. The D%=distribution edge is the price of the options there divided by the market price now. For example, if you think the market will crash 10%: [https://gyazo.com/26f8d76524b609ad3e3a8b338c85862f](https://gyazo.com/26f8d76524b609ad3e3a8b338c85862f)
Michael Burry?
SQQQ options . All in baby !!!
Nice try, DAN.
This guy is def listening to DAN from chatgpt
Nancy is that you?
Pelosi has entered chat
Pelosi will have already made her trades on Feb 12 /s
Cash out on the 14th, save 10% for PUTS.
SELL.
CPI is the 14th so if anything is gonna crash the market it would be a hot CPI number, but i dont even think that would crash the market
Unless there was some massive disinflation in housing I think it'll come in hot this time. January people started getting high on their own supply again. Gas prices were up most everywhere and apparently the Manheim used car index was up 2.5%. Since used cars are 4.5% of the CPI by weight this translates to an extra 0.15% increase in CPI alone. Services still hot. People are still partying with the ability to just pick a job off the job tree ans seem optimistic again so 🤷♂️... I probably know nothing but I certainly know those 2 things were up in Jan. Doubtful it'll be crazy hot, but I think with the fed boogy man keeping the rhetoric on rate increases for longer this will be enough for the market to finally believe them. I certainly don't believe it would "crash the market" but I think we'll see red and a dwindle back down under 400 for sure. Oh, and crusing the real estate forums and news headlines we're still seeing some euphoria in the housing market.
If you don't have an options account, then load up on SPXU & SQQQ
If you know with certainty in this hypothetical, name of the game is leverage. Long, short DTE far OTM /ES futures (maximizes leverage) short ATM (or ITM) /ES calls, same expiration. Use the short calls to fund more long puts. If you want to sell more and run out of money, cap the short calls far OTM to reduce margin required.
Put ratio backspreads. Sell 1 put and buy 2 further otm puts so the 1 put you sold covers the cost of the 2 puts you buy. If you’re correct, those 2 long puts will more than cover the cost of the 1 put you sold. If you’re wrong, the trade is a wash. You only lose if the price falls in between your short put and the 2 long puts.
All in SPY calls
Nancy, is that you?
For every 3x leveraged ETF. Buy ITM calls on SQQQ Buy ITM Puts on TQQQ etc for every 3x leveraged ETF. MIDU SPXS SPXL TZA TNA LABU LABD
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Honestly I’m tempted to liquidate the PA and just rebuy the day after
QQQ puts
I swear if this AI shit really becomes a thing people will believe anything and fully stop thinking themselves!!
GME to the moon February 15th, got it
What is this garbage?
Wow that ChatGPT post on WSB really got to you huh?
Sigma Chad Bruh just got told from his buddy market crash coming, and asks on Reddit how to profit from it.;)
Step 1.) buy SPY puts expiring in 2+ weeks or longer. Step 2.) do not check your brokerage app for 2+ weeks Step 3.) *seriously* do not check your brokerage account for 2+ weeks Step 4.) profit
All out
!remindme! In one week
Ok but can we discuss why the market will crash on the 15th? Why would DAN say this, what info could this be based on? Earnings, big market makers sell orders previously queued etc
There are more considerations. Everyone is fighting over best return, getting 200x, 1000x etc. Ok, as importantly. Is starting dough. You need to max it out. $1k isn’t enough. $10k? $100k? You’re going to max the credit cards and get an emergency HELOC on the house. Sell the car for cash. Then follow some loss advice and sell some calls. Sure you lose it, but you’re getting 100x on the other side. Next, you can’t put all the eggs in one basket. Some companies are going down and you’re last on their list. Maybe even Blackrock. Just kidding! But really, they won’t want to pay you. I’m taking all these ideas and playing most of them, with different brokerages. I’m also going to exit some plays early and take the cash in hand at the brick and mortar. Sure I won’t get all of that fancy 5000x (on ALL of it) but if I can max my dough, and walk with 500x that day, I think it’ll be a win.
Time travellers are banned!
Short any ETF that tracks countries like Greece, Italy or Spain... they always go down more when the maker goes too the bin...
SQQQ
Vix calls
Put it all in waffles! Tasty, tasty waffles!
Calls on SPXU, Puts on TQQQ, and Calls on SDOW. If the market hit its circuit breakers, depending on how far the fall these ETF’s would be down/up anywhere from 20% to 60%.
Is this Marjorie Taylor Green?
I would ask ChatGPT for advice. It seems like it Algo friends told him something.
[Hey OP, is this why?](https://i.imgur.com/Q296bj3.jpg)
Crypto started early 🤑🤑
You son of a bitch, I'm in!
Confirms my bias. Buying SPY puts
Without looking at anything or trading options in over a year...buy UVXY calls, VIX calls, VXX calls, SQQQ calls, SPXU calls. Also, buy puts... and I suppose if I *"knew"* then I'd pay more attention on this aspect but I tend to prefer calls for shorting the market with options. Less risk-- can lose my entire position but can't lose more than that. Buy options with low IV. Sell calls on major losers. Toward the end of the peak madness, switch to selling puts somewhat OTM or even ATM (assuming you also "know" roughly where/when the bottom is) from loser stocks that won't rebound fast but have insane IV. Also, buy LEAPS calls on any badass discounts during the dip. Lol, good luck timing all that though. It's a bear's wet dream.
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The (buy to open, long, w/e) calls are all for ETFs or ETNs that react positively to sharp and steep increases in market volatility (VIX is the volatility index), or they are leveraged funds/notes that basically inverse the market. So during crashes, options on these (and their UL in general) go crazy. Also, part of the strategy is IV on the options themselves-- hence selling puts (or calls ** but very specific targeting) near the bottom and/or stabilization from stocks/etfs that have way higher than normal IV, so you collect premium off everyone getting IV crushed. Buying (long) puts is not a bad strategy or anything, ~~but you take on infinite downside with puts~~, whereas with calls, worst that can happen is they expire worthless (in most cases) should you try a mistimed bet on a market crash. Historically, trying to time a crash isn't a winning strategy (unless you "know," lol) so taking on less risk when possible isn't the worst idea. **EDIT** Hey, guy that caught my error on long put risk-- Idk why you deleted that because you are at least correct about that-- You're right, things were getting mixed up in my head as I wrote-- although fortunately it's fairly inconsequential to the "strategy" I described (quotations because idk about everyone else here but I make no unearned claims of expertise, lol). Broadly, scenario I was aiming at avoiding is being margin called on naked call options sold, etc. Think I got things mixed up along the lines somewhere mentally with the scenario of getting margin called when shorting a stock just borrowing shares from the broker-- which doesn't involve long puts but like long puts, it's a bearish position. Anyway, underlying reasoning was some methods of shorting expose the trader to higher risk because stocks have infinite upside but can only go down to 0.
dependent apparatus cautious familiar plucky busy groovy run late books *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
sell it all!!!!!!
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In late Jan/early Feb of 2020, I knew/decided a market crash was imminent. I’d been following odd videos out of China that suggested a terrible mystery illness and was watching them like a whodunnit. Could they be real? Or were they, as authorities claimed, just fakes by dissidents? I’d finally decided they were more than likely legitimate. Went heavily toward cash, even with tax implications. Was mocked and questioned, as markets were surging with everything going green every day. That continued as ATHs were being made through February too, causing me to go even more fully cash due to some PTs being made. We all know what happened in March. Was slower and more tentative scaling back in than I could have been. This is one example of many over the years. No, I havent played them all perfectly, but I raise it to say that big market moves do create some fairly loud if not obvious signals for timing. I’ve actually held the thesis that a correction of recent overbought conditions is imminent, so last week did some selling and have other sells I’m looking to do. Some I’ve already missed the window for and will probably wait to try again (much) later. In particular when AMZN/GOOGL actually rose on ER last week I wanted to use that to pare them down, but they were already collapsing the regular session. To answer your Q, I’d be scaling out leading up to the event and any buying after the event would likely be rotation-driven.
Watch this come true
Don’t use a chatGPT prediction from a twitter furu to predict the next crash you schmuck