3 ms·
Three thousand dollars will get you options until 2020 that you can cash in for $50k worth. You don't need a ton of cash if you think they're going to zero.
by scarejunba 8y ago
Three thousand dollars will get you options until 2020 that you can cash in for $50k worth. You don't need a ton of cash if you think they're going to zero.
- whytaka 8y agoHow exactly do I do this?
- fwn 8y agoRemember that even Myspace is still around. Betting zero is a radical act.
- westpfelia 8y agoMyspace was never itself a publically traded company. They had the backings of News Corp to not die.
- kypro 8y agoI think he's talking about buying puts far in the future.
- glalonde 8y agohold up, how does that figure? I thought you could only get up to the amount invested back, which is why it is a really not great idea. Investing $3k now might net you up to $3k if the stock hits 0, but it could triple in which case you lose $6k. Bounded upside, infinite downside. I'm sure it's more complicated but what am I missing?
- tomp 8y agoOptions aren't "an investment", think of them more like "gambling". So the 3k is the "fee" (non-refundable), and the "winnings" depend on the price of the stock at a predefined date. In this case, the parent would buy a put option, which would pay out only if, and proportionally to the amount that, the stock is lower than some predefined price (usually the present price with a small delta).