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I agree with you... There is a (small) risk the stock goes to $1,000 or $5,000. My portfolio won't face any margin calls even with those numbers though... And e
by silexia 6y ago
I agree with you... There is a (small) risk the stock goes to $1,000 or $5,000. My portfolio won't face any margin calls even with those numbers though... And eventually the price will come back down.
I think it was Ben Graham who said the markets can remain irrational longer than you can remain solvent.
- gjm11 6y agoNope. It's usually ascribed to J M Keynes, buy apparently it was actually one A. Gary Shilling: https://quoteinvestigator.com/2011/08/09/remain-solvent/ https://quoteinvestigator.com/2011/08/09/remain-solvent/
- ra7 6y agoEventually it will come down, yes. But you're the option seller, so you can be assigned anytime. I assume this is a naked call you sold (not covered). So you might be forced to buy shares at a really high price and deliver at $320. The big risk with selling options is early assignment.
- Domenic_S 6y agoNo you'll just get assigned and lose $500k.
- fny 6y agoJust buy an lower priced call as a hedge to define your risk. If you get assigned you could land a pile of GME that goes to zero.
- dmurray 6y agoThat would give him a bull position and cost money, which probably is not what he had in mind. Perhaps you mean he could buy a higher priced call.
- base698 6y agoNo one is dumb enough to sell a call. Apparently we found one guy. Opening a spread would make you a ton of money for sure, but seems unlikely one would be sold.