3 ms·

i actually lost a small fortune (now its nothing but back then it was a lot) on nvidia options as well as buying large amount of puts on a crypto mining company

by spxneo 3y ago

i actually lost a small fortune (now its nothing but back then it was a lot) on nvidia options as well as buying large amount of puts on a crypto mining company. the reason im telling you is exactly the mentality you described: in Q1 I hit a major home run buying puts on a bunch of banks that went under. I experienced 28,300% ROI. From then on I was like an addict. Constantly loading up on insane amount of FDs until I lost all of what I earned. Quite an experience and I think its best to just focus on building or growing a business. Had I bought stocks and held I think that would've been better. Just realize the winners and pros are writing you the options in the long run. Punters like me, as I experienced, cannot last. Also its a zero sum game. When I experienced financial ruin, I realized when I hit that 283x bagger, the person who wrote me those put options experienced financial ruin. So now I'm jaded about options and financial markets in general. its a double edge sword. its a dangerous societal drug.

tombert 3y ago
I agree with everything you said, except is it actually implied they faced financial ruin with your 283x return? What if they were doing a covered call? Then they lose the stock, that sucks, but they're not going to go into debt. I'm just being pedantic, your broad points are absolutely true. I mostly just through cash into VTI.
- spxneo 3y ago
  because I talked to the guy who wrote those puts on wallstreetbets he was depressed from all the comments making fun of him so i sent him some money from the winnings now that i experienced the exact thing he experienced, im just done with trying to make a buck from the markets because the profits come from others loss. options trading is a zero sum game. maybe you can say same about about stocks or futures who knows. options also offer an important tool for managing risks like insurance. so again here im trying to attach some judgement to numbers which are amoral. I guess I just don't want to be part of something that causes so much emotional and mental violence anymore. I want to build and help create ease for others.
  - tombert 3y ago
    Ah, that's a sad story. I hope the person is ok; gambling debt of any kind can really mess with your head. I don't think stocks are zero-sum. If I buy a share of AAPL and hold onto it for a long time, Apple wants me to make a profit because that means that they're making money too. I have completely aligned my incentives, and Apple can, at least in theory, keep growing and creating value by producing products that people like and are willing to trade their time and labor to get. I guess if you want to be really pedantic, it's zero-sum in that there is technically a finite amount of labor being done per-unit-time on planet earth, so I suppose that's the ceiling, but I think it's not zero-sum until it reaches that ceiling.
    - spxneo 3y ago
      I guess the intent also matters...like moralism is pretty shaky here i see You can buy AAPL puts months before earnings as insurance....if you buy stocks and believe in the business fundamentals to help unlock more potential then that is a legit use. i wish i had more positive experiences with the market. i feel like its a reflection of your inner world.
      - tombert 3y ago
        Yeah, I bought Gitlab when it IPO'd because I agreed with what they were doing. I felt they were making a product that's competitive with Github, and also were allowing me to run it myself if I wanted. I thought that was cool, I was glad to see they got big enough to IPO, so I bought a few shares. I've lost about half my investment there, which if I'm being honest does makes me a little sad, of course I would rather have more money than I put in, but at least I think I doing the intent of the stock market. I think that the initial goal of the market was to enable people to invest into companies that they actually believed in, not to buy and sell shares a million times a second, or to buy and sell speculations at the same rate.
        WalterBright 3y ago
        > not to buy and sell shares a million times a second, or to buy and sell speculations at the same rate What this does is provide liquidity, meaning one can buy and sell at any moment. Contrast this with investing in houses. It's not liquid at all - even in a smooth transaction, it can take a month to close. Houses can sit on the market for months or even years looking for a buyer. The higher the liquidity, also means the more accurate the valuations.
gigaflop 3y ago
I am technically a war profiteer due to stock trading. I bought and then kept trickling some money into an oil index fund when news was everywhere about negative $/barrel, and Russia's invasion of Ukraine made me $500 when I sold out. (I don't actually feel like I did anything wrong, though. Just bought low and sold high, around oil macro events that anyone else could have seen)
- spxneo 3y ago
  A trade is a trade. I've come to accept this after hanging out with a hedge fund manager. I was trading my ego and I was gambling and I placed all these unrealistic expectations from the market. A trade is neither an expression of justice or injustice. It's just fucking numbers that we attach so much emotion and judgement on. Amoral != immoral.
  - gigaflop 3y ago
    I ain't rich enough to take a real moral standing in investing. The only principled buys I make are for ETFs/indices that sound like good ideas, but are nonstandard. Copper, Lithium, Uranium for now. The Earth isn't making any more of the stuff, and they're base resources for other processes.
    - WalterBright 3y ago
      > The Earth isn't making any more of the stuff We're nothing more than pond scum on the surface of the Earth. The Earth is full of stuff.
  - dllthomas 3y ago
    A trade is an action you are taking in the world. Just numbers sometimes mean someone goes hungry or loses their house, other numbers mean someone gets bombed. I don't actually know that it makes sense to judge these particular actions (especially of small players) in the face of the incentives, but I think your dismissal is too cavalier to be effective. The fact that your impact on the world is mediated by numbers doesn't itself absolve you of anything.
WalterBright 3y ago
> its a double edge sword Options may be zero-sum, but investing in general is not zero sum. For example, if you invested in MSFT 10 years ago, it's up maybe 10x since, and that extra value was created, not transferred.
1024core 3y ago
Small-time investors like us often get bit by the sharks. I was working in a niche area, and our company used to keep an eye on the competition. One quarter we realized that the competition was not doing well, so just before their earnings came out, I shorted the stock. Well, lo and behold! The stock tanked and I made a nice bundle by covering after the crash. 2 years later, again I see the same signs of a company that's not going to meet expectations. So I short again. This time, the MFers couched their quarterly report in language that hid the trouble they were in. They painted a rosy picture when we on the inside knew it wasn't going to come true. But the market bought it, and the stock rose sharply! ETrade forced me to cover my positions, and I lost all the money I had made 2 years earlier. Womp womp womp... Of course, a few days or something later, as analysts closely analysed their earnings report, they realized that there was a lot of smoke in there and the stock tanked. But it was too late for me. From that point onwards I have stayed away from such gambling on the market.

by spxneo 3y ago

tombert 3y ago

I agree with everything you said, except is it actually implied they faced financial ruin with your 283x return? What if they were doing a covered call? Then they lose the stock, that sucks, but they're not going to go into debt. I'm just being pedantic, your broad points are absolutely true. I mostly just through cash into VTI.

spxneo 3y ago
because I talked to the guy who wrote those puts on wallstreetbets he was depressed from all the comments making fun of him so i sent him some money from the winnings now that i experienced the exact thing he experienced, im just done with trying to make a buck from the markets because the profits come from others loss. options trading is a zero sum game. maybe you can say same about about stocks or futures who knows. options also offer an important tool for managing risks like insurance. so again here im trying to attach some judgement to numbers which are amoral. I guess I just don't want to be part of something that causes so much emotional and mental violence anymore. I want to build and help create ease for others.
- tombert 3y ago
  Ah, that's a sad story. I hope the person is ok; gambling debt of any kind can really mess with your head. I don't think stocks are zero-sum. If I buy a share of AAPL and hold onto it for a long time, Apple wants me to make a profit because that means that they're making money too. I have completely aligned my incentives, and Apple can, at least in theory, keep growing and creating value by producing products that people like and are willing to trade their time and labor to get. I guess if you want to be really pedantic, it's zero-sum in that there is technically a finite amount of labor being done per-unit-time on planet earth, so I suppose that's the ceiling, but I think it's not zero-sum until it reaches that ceiling.
  - spxneo 3y ago
    I guess the intent also matters...like moralism is pretty shaky here i see You can buy AAPL puts months before earnings as insurance....if you buy stocks and believe in the business fundamentals to help unlock more potential then that is a legit use. i wish i had more positive experiences with the market. i feel like its a reflection of your inner world.
    - tombert 3y ago
      Yeah, I bought Gitlab when it IPO'd because I agreed with what they were doing. I felt they were making a product that's competitive with Github, and also were allowing me to run it myself if I wanted. I thought that was cool, I was glad to see they got big enough to IPO, so I bought a few shares. I've lost about half my investment there, which if I'm being honest does makes me a little sad, of course I would rather have more money than I put in, but at least I think I doing the intent of the stock market. I think that the initial goal of the market was to enable people to invest into companies that they actually believed in, not to buy and sell shares a million times a second, or to buy and sell speculations at the same rate.
      - WalterBright 3y ago
        > not to buy and sell shares a million times a second, or to buy and sell speculations at the same rate What this does is provide liquidity, meaning one can buy and sell at any moment. Contrast this with investing in houses. It's not liquid at all - even in a smooth transaction, it can take a month to close. Houses can sit on the market for months or even years looking for a buyer. The higher the liquidity, also means the more accurate the valuations.

gigaflop 3y ago

I am technically a war profiteer due to stock trading. I bought and then kept trickling some money into an oil index fund when news was everywhere about negative $/barrel, and Russia's invasion of Ukraine made me $500 when I sold out. (I don't actually feel like I did anything wrong, though. Just bought low and sold high, around oil macro events that anyone else could have seen)

spxneo 3y ago
A trade is a trade. I've come to accept this after hanging out with a hedge fund manager. I was trading my ego and I was gambling and I placed all these unrealistic expectations from the market. A trade is neither an expression of justice or injustice. It's just fucking numbers that we attach so much emotion and judgement on. Amoral != immoral.
- gigaflop 3y ago
  I ain't rich enough to take a real moral standing in investing. The only principled buys I make are for ETFs/indices that sound like good ideas, but are nonstandard. Copper, Lithium, Uranium for now. The Earth isn't making any more of the stuff, and they're base resources for other processes.
  - WalterBright 3y ago
    > The Earth isn't making any more of the stuff We're nothing more than pond scum on the surface of the Earth. The Earth is full of stuff.
- dllthomas 3y ago
  A trade is an action you are taking in the world. Just numbers sometimes mean someone goes hungry or loses their house, other numbers mean someone gets bombed. I don't actually know that it makes sense to judge these particular actions (especially of small players) in the face of the incentives, but I think your dismissal is too cavalier to be effective. The fact that your impact on the world is mediated by numbers doesn't itself absolve you of anything.

WalterBright 3y ago

> its a double edge sword Options may be zero-sum, but investing in general is not zero sum. For example, if you invested in MSFT 10 years ago, it's up maybe 10x since, and that extra value was created, not transferred.

1024core 3y ago

Small-time investors like us often get bit by the sharks. I was working in a niche area, and our company used to keep an eye on the competition. One quarter we realized that the competition was not doing well, so just before their earnings came out, I shorted the stock. Well, lo and behold! The stock tanked and I made a nice bundle by covering after the crash. 2 years later, again I see the same signs of a company that's not going to meet expectations. So I short again. This time, the MFers couched their quarterly report in language that hid the trouble they were in. They painted a rosy picture when we on the inside knew it wasn't going to come true. But the market bought it, and the stock rose sharply! ETrade forced me to cover my positions, and I lost all the money I had made 2 years earlier. Womp womp womp... Of course, a few days or something later, as analysts closely analysed their earnings report, they realized that there was a lot of smoke in there and the stock tanked. But it was too late for me. From that point onwards I have stayed away from such gambling on the market.