Speculation is fun!
More finance musings. Last Wednesday after the stock market sunk for the second time this week I was thinking that we had reached something like the bottom, I could only see the market going up. I am not a financial wizard, that was just my gut-level take on everything going on. I was so convinced that I dabbled in some theorycrafting for my portfolio. I am not currently investing in the stock market (thank God) because L and I still have to shore up the foundation of our little home, but I've been playing a paper portfolio for a while. So Tuesday morning I 'bought' a round lot of SPY 120 call options for $11.40 with a date of Dec09 when the S&P was at 1150. In English, I bet that the market would go up.
The market didn't just go up after that, though, it jumped, it leaped, it soared. The S&P approaching 1300 and I bought the option only a few days ago. If I sold the investment now at 17.10 that would be a profit of 570 dollars for two days investment. That's 2.5 X 10^35 % rate of return. Again, translating to English, if you invested a dollar at that rate of return on January first you would be richer than Bill Gates on April 21.
Of course most of the time with options you don't get anything back and no-one can predict the last two days movements with any consistency so I am not saying that I am an investing genius, I just got lucky.
But I thought it appropriate to talk about booty on today of all days... mateys..
Yarrrr....
The market didn't just go up after that, though, it jumped, it leaped, it soared. The S&P approaching 1300 and I bought the option only a few days ago. If I sold the investment now at 17.10 that would be a profit of 570 dollars for two days investment. That's 2.5 X 10^35 % rate of return. Again, translating to English, if you invested a dollar at that rate of return on January first you would be richer than Bill Gates on April 21.
Of course most of the time with options you don't get anything back and no-one can predict the last two days movements with any consistency so I am not saying that I am an investing genius, I just got lucky.
But I thought it appropriate to talk about booty on today of all days... mateys..
Yarrrr....