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Megathread: President Donald Trump announces he has tested positive for Coronavirus | Part II

President Donald Trump announced he and First Lady Melania Trump had tested positive for the virus and will begin their quarantine and recovery process immediately. The news comes after it was announced that close presidential aide Hope Hicks tested positive Wednesday evening.
Megathread Part I

Submissions that may interest you

SUBMISSION DOMAIN
Trump, first lady to quarantine after top aide tests positive for coronavirus thehill.com
Trump flew to New Jersey for a fundraiser, reportedly after learning Hope Hicks had COVID-19 symptoms theweek.com
Putin says Trump's 'inherent vitality' will see him through COVID-19 reuters.com
Trump in 'quarantine process' after top aide gets COVID-19 sfgate.com
Trump in ‘Quarantine Process' After Top Aide Gets COVID-19 nbcwashington.com
President Donald Trump, first lady to quarantine after top aide tests positive for COVID-19 upi.com
Trump in ‘quarantine process’ after top aide gets COVID-19 bostonherald.com
Trump's positive Covid-19 test throws country into fresh upheaval amp.cnn.com
Putin offers Trump wishes of 'sincere support' after positive coronavirus test thehill.com
Trump tests positive for COVID-19: What happens if the president cannot perform his duties? wftv.com
President Trump and first lady Melania test positive for COVID-19 cbsnews.com
Fears for Joe Biden after Trump tests positive for Covid theguardian.com
Trump's positive Covid test was a surprise that many saw coming theguardian.com
Biden Will Get Urgent COVID-19 Test After Trump’s Diagnosis, Says Report thedailybeast.com
Vice President Mike Pence and second lady test negative for coronavirus following Trump's positive diagnosis cnbc.com
VP Mike Pence tests negative and 'remains in good heath,' after Trump tests positive for COVID-19 timesunion.com
The Finance 202: Stock futures dive on the news that Trump has coronavirus washingtonpost.com
Putin wished Trump a speedy recovery after his COVID-19 diagnosis, and said his 'innate vitality' will see him through businessinsider.com
Mike Pence and wife Karen test negative for coronavirus after Trump diagnosis independent.co.uk
China’s state media outlet mocks Trump for contracting coronavirus nypost.com
Inb4 trump has now "contracted" coronavirus cos his team knew he f****d up the first debate that bad that any further appearance would be detrimental to his campaign. sbs.com.au
Putin says Trump's 'inherent vitality' will see him through COVID-19 reuters.com
Mike Pence and wife Karen test negative for coronavirus after Trump diagnosis independent.co.uk
Trump tests positive for COVID-19: Pence tests negative, Biden reportedly getting test usatoday.com
Timeline: How Trump Has Downplayed The Coronavirus Pandemic npr.org
Trump's coronavirus diagnosis presents America with new clear, present dangers axios.com
Biden to get tested Friday morning following Trump COVID-19 positive test: report thehill.com
The virus spares no one’: World reacts to Trump’s positive coronavirus test washingtonpost.com
Shock, sympathy, mockery: World reacts to Trump infection - CBC News cbc.ca
Trump’s Covid diagnosis renews testing debate on Capitol Hill politico.com
Mike Pence, who will assume the presidency if Trump is incapacitated, has tested negative for COVID-19 businessinsider.com
Biden wishes Trump, first lady 'swift recovery' after positive COVID-19 tests thehill.com
MyPillow Guy Mike Lindell Shouts Out Unproven COVID-19 'Cure' To Trump huffpost.com
Age, obesity put Trump at high risk for severe coronavirus infection axios.com
Chinese state media mocks Trump's positive virus test: 'Paid the price for his gamble to play down' pandemic thehill.com
Older, overweight and male: Trump's COVID risk factors make him vulnerable reuters.com
President Trump’s positive Covid-19 test throws country into fresh upheaval mercurynews.com
Trump’s Covid-19 Diagnosis Reshapes Election a Month From Vote bloomberg.com
MyPillow Guy Mike Lindell Shouts Out Unproven COVID-19 ‘Cure’ To Trump m.huffpost.com
Trump’s positive coronavirus test will keep him out of swing states he hasn't visited yet independent.co.uk
QAnon Believers Think Trump Got COVID On Purpose Because of Course They Do - QAnon followers believe the virus is fake, but also that Trump has it. And they're "dangerously hype" about it. vice.com
Biden says he's 'praying for the health and safety" of Trump after the president's COVID-19 diagnosis businessinsider.com
Keller: Will Voters Punish Trump For Deriding Coronavirus Precautions? boston.cbslocal.com
‘Wear A God Damn Mask,’ Joe Kennedy Tweets While Wishing Trump Fast Covid Recovery boston.cbslocal.com
New York Times slammed for suggesting Trump might not remain on ballot after coronavirus diagnosis foxnews.com
Trump joked while people suffered with Covid. Well, is now the time to stop? theguardian.com
Pence, second lady test negative for coronavirus after Trump's positive result thehill.com
Coronavirus: Pelosi says Trump’s failure to wear masks at rallies was ‘brazen invitation’ independent.co.uk
Fox's Kilmeade: Trump could serve as positive example if he beats COVID while in 'danger age' of 74 thehill.com
White House wanted to keep Hope Hicks's positive COVID-19 test private: report thehill.com
Trump experiencing ‘mild symptoms’ after coronavirus diagnosis cnbc.com
Trump experiencing 'mild symptoms' after coronavirus diagnosis cnbc.com
Trump’s strange pre-spin on his coronavirus diagnosis: It came from military, police who want to ‘hug’ and ‘kiss’ you washingtonpost.com
Minnesota congressmen traveled with Trump before, after Duluth rally and positive COVID-19 test duluthnewstribune.com
White House official: Trump experiencing ‘mild’ symptoms of coronavirus after positive test apnews.com
Putin sends Trump a telegram offering ‘sincere support’ after positive coronavirus test marketwatch.com
RNC chair Ronna McDaniel has tested positive for coronavirus following Trump diagnosis independent.co.uk
Trump’s Behavior Was ‘Brazen Invitation’ for the Coronavirus, Pelosi Says thedailybeast.com
Trump, first lady positive for virus; he has 'mild symptoms' apnews.com
Trump, first lady positive for virus; he has ‘mild symptoms’ apnews.com
Donald Trump has 'mild symptoms' after contracting coronavirus news.sky.com
President Donald Trump's coronavirus infection draws international sympathy and a degree of schadenfreude eu.usatoday.com
Gretchen Whitmer: Donald Trump's COVID-19 diagnosis 'wakeup call to every single American' freep.com
Kushner, Ivanka Trump test negative for COVID-19 thehill.com
Tracking Trump: Where the president was and who he came in contact with before announcing his positive coronavirus test marketwatch.com
Of Course Donald Trump Got Covid newrepublic.com
Trump has ‘mild symptoms’ after testing positive for COVID-19 wkow.com
Trump and Melania test positive for Covid. foxnews.com
Leftists Cheer News Trump, Hope Hicks Infected With COVID-19: ‘I Hope They Both Die’ dailywire.com
White House coronavirus adviser Scott Atlas reacts to Trump's coronavirus diagnosis, says 'zero reason to panic' foxnews.com
Piers Morgan rips mockery of Trump after contracting COVID-19: 'No better than the man they loathe' thehill.com
Trump Has ‘Mild Symptoms’ After He and First Lady Test Positive for COVID-19 nbcnewyork.com
US stocks slump after Trump tests positive for virus bostonglobe.com
Trump’s test shows how Covid-19 might threaten Barrett confirmation rollcall.com
UK bookmakers stop taking bets on US election after Trump gets Covid-19 edition.cnn.com
WATCH: Trump ignored the science and his own experts on coronavirus — now he's tested positive for COVID-19, while more than 200,000 Americans have died businessinsider.com
Pelosi: Trump Flouting COVID-19 Guidelines Was 'A Brazen Invitation For This To Happen' - The president, who said he tested positive early Friday, has downplayed the COVID-19 pandemic, even as more than 200,000 Americans have died. huffpost.com
Trump Supreme Court nominee Amy Coney Barrett tests negative for coronavirus thehill.com
Trump’s pre-spin seems to blame military, police interactions for coronavirus diagnosis washingtonpost.com
How Many People Has Donald Trump Already Infected With COVID-19? vanityfair.com
Concern over Biden's possible exposure to COVID-19 after Trump tests positive abcnews.go.com
RNC chairwoman tests positive for coronavirus after she was with President Trump, who has COVID nydailynews.com
Donald Trump's Positive COVID-19 Announcement Becomes His Most Liked Tweet Ever newsweek.com
Hicks, hubris and not a lot of masks: the week Trump caught Covid theguardian.com
'We continue to pray': Joe Biden offers thoughts, prayers to President Trump for speedy recovery after coronavirus test usatoday.com
Nancy Pelosi says Trump’s behavior was ‘brazen invitation’ after COVID-19 infection nypost.com
Pelosi says Trump's actions were a 'brazen invitation' for a positive COVID-19 test, calls his diagnosis 'very sad' and 'tragic' businessinsider.com
Conspiracy theorists believe Trump is using COVID results to postpone the election — Many online are calling b.s. amid the shocking news. dailydot.com
A Steelworker Who Sat In The Debate Hall On Trump’s Positive Coronavirus Test: “It’s Frustrating” buzzfeednews.com
President Trump showing mild symptoms after testing positive for COVID-19: officials nydailynews.com
Mitch McConnell says the next presidential debate could be held remotely via videoconference after Trump tests positive for COVID-19 businessinsider.com
Trump experiencing mild Covid symptoms: Why the first week matters nbcnews.com
Trump had close contact with "dozens" on trip after White House learned he was exposed to COVID-19. Trump traveled to a fundraiser after Hope Hicks already tested positive and he was "feeling poorly" salon.com
Trump Kept Regular Schedule After Learning Close Aide Had Covid bloomberg.com
Map: President Trump’s travels the week he tested positive for Covid-19 nbcnews.com
QAnon, the far-right, and some left-wingers are all spreading conspiracies about Trump's COVID-19 diagnosis businessinsider.com
GOP donors panic after coming close to Trump at fundraiser hours before his positive Covid-19 test cnbc.com
Trump experiencing "mild symptoms" of the Coronavirus newsday.com
Biden, Harris express wishes for speedy 'recovery' after Trump's positive coronavirus test foxnews.com
Trump and Melania 'paid the price': Chinese propaganda mocks president after COVID-19 diagnosis - The editor-in-chief of one of China's state-run media outlets suggested that President Donald Trump and the US first lady, Melania Trump, "paid the price" by contracting the coronavirus. businessinsider.com
Putin sends Trump a telegram to wish him speedy recovery from COVID-19: agencies cite Kremlin (Reuters) reuters.com
Trump coronavirus: Pence ‘praying for full recovery’ of president and first Lady Melania after positive test independent.co.uk
After Trump's COVID-19 diagnosis, Trump, Biden appearances in Arizona next week unclear azcentral.com
Trump’s coronavirus infection is an indictment of his approach to the pandemic - The diagnosis is another reminder of his administration’s failure on Covid-19. vox.com
“No one knows where this is going to go”: Pandemonium inside the White House as Trump contracts COVID-19 vanityfair.com
Trump experiencing mild symptoms from COVID-19 telegraph.co.uk
Judge Amy Coney Barrett tests negative for COVID-19 after Trump contracts virus nydailynews.com
President Trump apparently has COVID-19 thebulletin.org
Stocks Fall After Trump Tests Positive for Covid-19 nytimes.com
Twitter users predicted Trump's October COVID-19 diagnosis dailydot.com
White House learned of Hicks's positive test before Trump left for fundraiser: Meadows thehill.com
[GOP donors 'freaking out' after coming close to Trump at fundraiser hours before his positive Covid-19 test](https://www.cnbc.com/2020/10/02/gop-donors-panic-after-coming-close-to-trump-at-fundraiser-hours-before-positive-covid-19-test.html?__source=sharebar twitter&par=sharebar)
Chris Wallace Says He's Getting Tested for Coronavirus After Being Exposed to Trump During Debate — "I don't think there's any question it's going to raise questions again about how seriously the president has taken the coronavirus," Wallace said Friday. people.com
Trump's Covid diagnosis upends campaign, presents challenge for Biden — "This election isn't about Trump getting Covid, it's about America getting Covid," one Democratic strategist said. nbcnews.com
Trump tests positive for COVID-19: Trump 'feeling mild symptoms,' but 'energetic'; Bidens praying for Trumps - live updates usatoday.com
At 74 and obese, Covid-19 could be very serious for Donald Trump telegraph.co.uk
John Cleese Revels in Donald Trump's COVID-19 Diagnosis — The 'Monty Python' icon has made it clear in the past he is not a fan of the president's and often criticizes him via social media. hollywoodreporter.com
What Trump’s Positive Coronavirus Test Means for the Presidential Campaign newyorker.com
Pelosi: Trump Flouting COVID-19 Guidelines Was ‘A Brazen Invitation For This To Happen’ m.huffpost.com
The Surprising Leftists Who Actually Wished Trump Well After COVID Diagnosis townhall.com
How Will Trump’s Positive COVID-19 Test Affect The Election? fivethirtyeight.com
Trump campaign did not notify Biden of positive coronavirus test thehill.com
President Trump has ‘mild symptoms’ after testing positive for the coronavirus opb.org
Trump downplayed Hope Hicks' Covid diagnosis on Fox hours before announcing he also tested positive cnn.com
Mary Trump Slams President After Coronavirus Diagnosis: ‘Wear a F*cking Mask’ thedailybeast.com
Trump's age and weight could put him at higher risk for severe coronavirus infection cbsnews.com
Will Trump’s COVID-19 Infection Change the Way He Manages the Pandemic? It Didn’t for the Leaders of Brazil and the U.K. time.com
Trump's busy week before his positive Covid-19 test – in pictures - US news theguardian.com
Timeline of Donald Trump’s activities in week coronavirus hit home mlive.com
Global stocks fall, dollar gains after Trump gets coronavirus uk.reuters.com
The latest coronavirus test results for Trump’s advisers and allies washingtonpost.com
Sen Rob Portman, Rep Jim Jordan, Jon Husted will get COVID tests after being around Donald Trump beaconjournal.com
Trump’s coronavirus infection is the result of his deadly, foolish recklessness latimes.com
Positive! Trump’s Covid Bungling Now Takes a Personal Toll thenation.com
Boris Johnson, who almost died of covid-19, wishes Trump a ‘speedy recovery’ washingtonpost.com
Did President Trump Refer to the Coronavirus as a 'Hoax'? snopes.com
The world was already in chaos before Trump's COVID-19 diagnosis, and now there is more uncertainty than ever businessinsider.com
Joe Biden has tested negative for coronavirus after Trump tests positive vox.com
Trump says he and first lady have tested positive for the coronavirus washingtonpost.com
Trump has coronavirus: Biden tests negative for COVID-19 after sharing debate stage with president - WATCH LIVE abc7ny.com
'Not a Tragic Accident—A Crime Scene': Critics Say Trump Covid Diagnosis a 'Culmination' of His Deadly Pandemic Response commondreams.org
After Trump's Positive Test, Here's The Status Of The Line Of Succession npr.org
Trump suggested US troops or police were to blame for infecting White House staff just before he tested positive for COVID-19 businessinsider.com
Democratic nominee Joe Biden tests negative for coronavirus after potential exposure, Trump's diagnosis cnbc.com
Schumer demands Senate coronavirus testing program after Trump diagnosis thehill.com
Flights for Donald Trump's Wisconsin rallies canceled after president tests positive for COVID-19 madison.com
Joe Biden tests negative for coronavirus after Trump tests positive businessinsider.com
Trump's coronavirus diagnosis guarantees this election will be about everything he has tried to avoid cnn.com
The stock market's fear gauge surges 12% after President Trump tests positive for COVID-19 news.sky.com
Trump Team Knew of Hicks’ Positive Test—but Went Ahead With Golf Club Fundraiser thedailybeast.com
InfoWars’ DeAnna Lorraine Claims ‘the Left’ May Have Given Trump COVID-19 Through His Debate Mic rightwingwatch.org
Getting COVID-19 Is Probably Not a Brilliant Ploy for Sympathy That Will Boost Trump’s Reelection Chances slate.com
House Probe Into Trump's Failed Covid-19 Response Shows "Unprecedented, Coordinated" Political Interference commondreams.org
This Republican senator is the early leader for worst take on Trump's coronavirus diagnosis cnn.com
Chris McDonald ‘Wouldn’t Put it Past’ Democrats to Infect Trump With COVID-19 to Stop the Presidential Debates rightwingwatch.org
Trump supporter potentially exposed to COVID-19 from RNC chair's visit cincinnati.com
GOP senator on Judiciary panel tests positive for Covid-19 days after meeting with Trump's nominee cnn.com
Today’s coronavirus news: Ontario sets new record with 732 reported cases; Trump, first lady test positive for virus; Biden tests negative thestar.com
[Politico] Trump coronavirus diagnosis leaves lawmakers exposed politico.com
RNC chair Ronna McDaniel says she has COVID-19, hours after Trump 6abc.com
Nancy Pelosi Says Donald Trump's Actions Were 'Brazen Invitation' to Catch COVID newsweek.com
Trump Has Repeatedly Downplayed COVID-19. What Will He Do Now That He Has It? buzzfeednews.com
No, Trump Isn’t Faking COVID In A Master Scheme To Vanquish Biden talkingpointsmemo.com
Trump Could Only Ignore the Reality of Coronavirus for So Long jacobinmag.com
Trump’s ‘positive for COVID-19’ tweet is his most ‘liked’ post ever marketwatch.com
Trump’s refusal to wear a face mask is a catastrophe A face mask might have protected Trump — and the people around him — from the coronavirus. vox.com
Schumer says Trump coronavirus diagnosis shows what happens 'when you ignore science' foxnews.com
Sen. Mike Lee, who met with Trump Supreme Court pick Amy Coney Barrett, tests positive for COVID-19 usatoday.com
Nancy Pelosi says continuity of government is ‘always in place’ after Trump tests positive for Covid-19 cnbc.com
Naomi Klein: I Fear Trump Will Exploit His COVID Infection to Further Destabilize the Election democracynow.org
PolitiFact - Trump’s health and COVID-19: Here’s what we know politifact.com
Confusion, concern infiltrate White House after Trump’s positive test politico.com
Putin, Who Has Spent Almost Six Months In Isolation To Avoid The Coronavirus, Sent Trump A Get Well Note buzzfeednews.com
Trumpworld delighted in cruelty. Now that Trump has COVID, it demands empathy. businessinsider.com
Where Trump went (and who he was with) leading up to his coronavirus diagnosis politico.com
Biden tests negative for COVID-19, reminds folks to 'wear a mask' after being mocked by Trump for mask at debate usatoday.com
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How to be Wrong and Still Make Money: A comprehensive guide to selling credit spreads

So I first dipped my toes into options trading a few years ago. I had previously been swing trading stocks so I had a couple years of experience before that, but the leverage and potential returns that options provided really piqued my interest. After it was all said and done, I lost almost $20,000 buying options. After realizing that someone was getting all of this money I was losing, I learned about option selling and haven’t looked back since.
I recently posted my YTD performance here, and received a lot of questions about how I did it. My strategy changed over time, but I first started with credit spreads, which may be applicable to more people since it’s a strategy that works with smaller accounts too. I got a lot of questions about how I played credit spreads and it’s tough to completely explain what I do through a comment here and a comment there so I created this guide explaining my exact approach to trading credit spreads. Here you go:
This is a wall of text, so if you're a more visual learner, here's a link to videos explaining all four parts:
Part One
Part Two
Part Three
Part Four

Part One: The Basics

So what is a spread? A high level conceptual explanation is that you’re essentially betting on a stock to finish above or below a certain price upon expiration. One of the advantages here is that you can set this number out of the money, so if a stock is trading at $100, you can bet that it’ll remain below $110 by a certain date. This is a bearish position, so if you’re correct and it goes down, you’ll make max profit. The catch though is that even if you’re wrong, you basically have a 10% upward cushion before you start to lose any money. So the easiest way to describe it is a strategy that lets you make money if you’re right, but also make money if you’re slightly off.
How does it work? So in the above example, if we were bearish on a stock we would open what’s called a call credit spread. We could set it up where we sell a 110c for a credit of $1.50, and buy a 115c for a debit of $0.50. This means that in this transaction we receive $1.50, and pay $0.50 for a net credit of $1. That credit is your max profit on the play. If you’re familiar with options you’ll know that if the stock finishes at or below $110 upon expiration, both of these calls will be worthless. That’s great news for us because the long leg we bought (115c) for 0.50 will be a loss, but we’ll get to keep the full $1.50 from the short leg (110c) that we sold, resulting in us realizing our max gain on the trade of $1.
Why not just sell the 110c and collect the full $1.50? While it cuts into our profits, the reason we buy the 115c in this example for $0.50 isn’t to cut into our profits when we’re correct, but rather protect us when we’re wrong. If the stock in the example stays below $110, we’re good to go and we’ll hit max profit. But what if it goes to $120, $150, or something crazy happens and it hits $200. If the stock hits $150 upon expiration, that 110c that we sold for $1.50 will be worth $40, meaning that we’ll incur a $3,875 loss in pursuit of a $150 gain. We’ve seen crazy run ups from the likes of TSLA and ZM lately, and people who sold what we call “naked options” got absolutely killed. With our spread, yes our 110c will be worth $40 meaning we’re down $4,000 on that position, but the 115c we bought behind it will be worth $35 meaning we’re up $3,500 there for a net loss of $500. Additionally, we get to keep that $1.00 credit we received up front no matter what, so our loss with this spread is actually $500-$100=$400 as opposed to the $3,875 loss that we would’ve seen had we sold the 110c by itself. THAT is the value in selling a spread as opposed to a naked option.
Why are you multiplying everything by 100? Each options contract is worth 100 shares, so a contract that is trading for $1.50 actually costs $150 to purchase.
Another high level point I like to make is that there are really 5 different things that can happen when you make a play. Let’s say you think a stock will go up. It can (1) go up a ton and you’d be correct, (2) go up a little and you’d be correct, (3) trade flat and you’d be incorrect, (4), go down a little and you’d be incorrect, or (5) go down a lot and you’d be incorrect. With a bullish spread, you’d hit max profit on 4/5 , or 80% of the possible outcomes, whereas if you bought stock or purchased an option you’d only be profitable on (1) or (2). Obviously the actual outcomes are a little more complex, but for a base-level understanding of the advantages a spread provides, I think this is a good way to look at it.
So that’s the value of a spread. A lot of traders are introduced to option selling and are scared of the prospect of incurring a huge loss like we mentioned above, but using credit spreads is a great way of receiving the benefits that selling has to offer while limiting a lot of the risks. So let’s move onto actually opening a spread.

Part Two: Making the Trade

So for actually opening a spread up, we have a four-step approach we take: Pick a Stock Pick a Direction Pick a Strike Price Execute the Trade
1: Picking a Stock:
One of the most important things I tell people is to trade what you know. I have a watchlist of 25-30 stocks that I watch and get familiar with during the day. That way if I recognize a good opportunity, I’ll have a decent base of knowledge to rely on to make what I feel is a smart play. It’s super easy to get caught up in the “stock of the week” and try to jump in on a play because a ticker is in the news. If you’re not familiar with a stock, don’t trade it.
For this example (the one used in the video), Wayfair was trading in a 195-210 range for a little bit and then had a big day where it broke up out of that range and up towards $220. This was an unusual move that I noticed since it was on my watchlist, so I decided to make a play.
STOCK: WAYFAIR
2: Picking a direction:
So if we look at Wayfair’s YTD chart, it has exploded this year. A clear upward trend, but a recent trend that I noticed from following the stock was that every time it broke out like this, there would be a little bit of a pullback afterwards. Additionally, I felt the stock was overvalued on a fundamental basis (had a negative book value at the time of the trade) so I wanted to play this stock back down. This is probably the quickest and easiest step of the four, since you’ll likely already have an opinion on most of the stocks that you follow.
DIRECTION: DOWN
3:Picking a Strike Price:
So we know that we’re going to be playing Wayfair back down, but now the question is what spread are we going to set up to do that. In this example Wayfair was trading at $218.42 at the time that we decided to make this trade. In the video we illustrate a trading channel that Wayfair was at the top of. It was also approaching the ATH of $221.54. A lot of the time that will act as resistance for a stock, meaning it’ll bounce down off of it. So in order to give ourselves a bit of a cushion we decided to set our short leg at 222.50, meaning that we’re playing the stock to stay below $222.50 by the end of that week.
So with this play it means in plain English that if we’re correct and the stock goes down, we hit max profit. But if we’re wrong and it goes up, we still have a $4.08 cushion before we’re not hitting max profit anymore. So we could be a little wrong, have the stock go up a few dollars, and still walk away with max profit.
STRIKE PRICE OF SHORT LEG: $222.50
4: Executing the Trade:
I’ll be the first to tell you that when I started trading spreads I didn’t realize you could open both legs of the spread at once. I was stupid. I would like to think I’m at least a little bit smarter now. If you look at the options screen for most brokers, you’ll just see single legs. Switching over to “vertical” allows you to set up the entire spread in one trade. If you use something like RH, there’s a feature that allows you to select multiple options, so you’ll select the one you wish to sell (short leg) and the one you wish to buy (long leg).
In this example we selected the 222.5/227.5c spread, meaning that we sold the short leg of 222.5 and the long leg of 227.5. The net credit was 1.45, which is our max gain on the trade. A wider spread gives a larger credit but also increases max loss. This is a $5 wide spread but we could have made it a tighter spread with a $2.5 width. Typically the best risk to reward ratio is on the tightest spreads, but a slightly wider spread will raise your breakeven price and studies have shown that it actually results in better expected value long term.
Circling back to the credit we received of $1.45, this means that our max profit was $145 and our max loss was $355 for each spread that we sold. We know that because our broker tells us that, but a quick way to calculate it is the width of the spread minus the credit. A $1.45 credit on $5 wide spread means a $5-$1.45=$3.55 max loss.
When I evaluate trades like this I look for a max profit to max loss ratio of 1:2 to 1:4. Based on different scanners I’ve seen, the best expected values tend to fall on spreads within that risk/reward ratio. The ratio on this trade is 1:2.44.
So we put our order in for a credit of $1.45, it filled, and now we get to sit back and watch. Sometimes your order won’t fill right away. In fact, most of the time it won’t fill right away. It’s important to be patient with your fill price and not chase it downwards. We want the highest credit possible. So if the credit on these spreads dropped to 1.30 when I was trying to place an order, it usually isn’t a great idea to drop my order price down to 1.30 just to get a fill. The only time I would recommend that is if you’re trying to open a spread right before the market closes. Otherwise, hang tight. Patience pays.

Part 3: Managing the Trade

So now that we’ve made the trade, it’s time to manage it. In my opinion one of the best parts about trading spreads is that they don’t require active management. You get to sit back and watch the price. Once the trade has been opened, which is also quick, it takes very little effort.
So with the Wayfair example we used, our analysis turned out perfectly, as Wayfair touched the ATH and dipped back down to end the week safely at $214. We hit max profit on that trade, but what if the trade goes against us? That’s what we’ll take a look at in this section.
One thing we didn’t address in part two is when to open the trade. We like opening spreads on Mondays and Tuesdays, and monitoring them during the week. This is the part of my strategy that is a little bit controversial, as there is a (legitimate) school of thought that selling spreads about 45 DTE is better value. I like that idea and if you would rather do that then absolutely go for it. It’s important to trade what you’re comfortable with. All of the lessons in here still apply to that strategy. With that said though, I stick with the weekly strategy of opening them at the beginning of the week and look to close them throughout the week.
The way I see it, your % of max profit should be the metric you’re looking at when deciding what to do with a spread. Divided up equally, that means if you progressed through the week to max profit in a linear fashion, you would be at 20% of max profit on Monday, 40% on Tuesday, and so forth. A good rule of thumb I use is that if you’re ever on the fence about whether or not to close something out, do so if your return exceeds the linear return for that day of the week. The market can move quickly and I’ve had several times where I have regretted not closing a spread out. It’s important to take profit.
Another thing I’ll add to this is that this weekly strategy gets a little risky on Thursday afternoon headed into Friday. If your spread is remotely close to being in the money on Thursday afternoon, close it out. Now that I type that out I realize that may all sound a little convoluted, but it’s better visualized in the video I’ve linked for this section.
Now let's get into what happens if a trade really starts to move against you. With the strategy we use there are really two options: (1) Close the trade for a loss and move on, or (2) Roll the strikes higher.
The first option is pretty self explanatory, but a quick note I want to add here is that you can have a stock move way against you but still be able to close the trade for less than max loss. The example I use in my video is I played FB earnings, thought it would go down, but it shot way above my spread and well into max loss territory. We opened a 245/247.5c spread for a credit of $0.54. FB was reporting earnings on a Thursday night and we sold this spread that expired the following day, so there wasn’t a ton of time to manage it. Long story short, FB killed earnings and shot up to $256 that morning. Really not a prayer that it would come back down to the spread I opened by the end of the day. But despite the fact that this trade went way against us and we had almost no time to manage it since it was a Friday play, we were still able to close out for a debit of $1.90. Yes that’s a loss of $1.36 per spread, but we SAVED an additional $0.60 cent loss by avoiding a max loss debit of $2.50. That’s another benefit of spreads.
Let’s talk about option two. This is the best option to use if you’re confident that you’re correct about the ultimate price action on a stock, but you need a little extra wiggle room on the trade. For this example we’ll look at a TSLA call spread that I opened. TSLA was trading at $1542 after an incredible run, so I figured I would play it below 1600 with a 1600/1610c spread that offered a credit of $2.52. As is the theme with this section, TSLA exploded the following morning (Tuesday) and went all the way up to $1794 at one point. My spread was literally almost $200 out of the money. One of the biggest possible moves against myself that I had ever seen. Despite this crazy move, it was only Tuesday and we were able to close the first spread for a debit of only $5.25 (as opposed to a $10 max debit). We opened 6 of these off the bat so this was a loss of $1638. From there we “rolled” our strikes higher, opening 10 1750/1760c spreads for a credit of $3.45. So the closing and subsequent opening of a spread like we did here is what we are referring to when we say we “rolled the strikes higher”.
By the end of the week TSLA had finally crashed a bit and it finished at $1506. This meant the second of spreads we opened were easily max profit. And while we lost $1,638 on the first set of spreads we opened here, we profited $3,450 on the second set of spreads so we were able to still finish the week with a $1,812 profit on TSLA. The funny thing with this one is that the original spread would have hit max profit since it dropped all the way back down to 1500, but we would have had the same result had TSLA finished anywhere below 1750.
Rolling the strikes higher gave me extra breathing room and turned a potential disaster into a profitable trade. One thing I’ll add though is that with this method you do run the risk of increasing your potential max loss. Because of that, I’ll only roll my strikes higher ONCE. Anything past that is chasing a losing trade. If I roll my strikes higher and it’s still going against me, I’m at the point where I need to accept the fact that I don’t fundamentally understand a stock as well as I thought I did and move on. There is always another trade out there.
The final point I’ll add to this is ALWAYS CLOSE OUT YOUR SPREADS. The only time I’ll let a spread expire worthless is if my spread is OTM by a crazy amount and it would quite literally take a historic after-hours move on Friday to take me back ITM. Other than that, close your spreads out. Even if it’s just for a $0.05 debit. It may seem annoying but I’ll tell you why in the following section.

Part 4: Additional Risks and Considerations

I will start this section by saying I’ve never been impacted by any of the following risks, but it’s important to be aware of 100% of the possible outcomes of your trade before you enter it. They’re infrequent but this really wouldn’t be a comprehensive guide if I omitted them. They are as follows: (1) Early Assignment, (2) Dividend Risk, (3) Pin Risk.
1: Early Assignment:
The best way to start this section is by talking about why your max loss is actually your max loss. We know it’s quickly calculated as the width of your spread minus the credit, but why is that?
Let’s use a 110/115c spread as an example. We’ll say we received a credit of $1. We know that if the stock finishes anywhere below 110 then both legs are worthless and we’ll hold onto that $1 credit. But what happens if we’re in a max loss position. Let’s say the stock finishes at $120.
In this situation the short leg (110c) we sold would be worth $10 (120-110), meaning that we would owe $1,000 on that position. The long leg we bought would be worth $5 (120-115), meaning we are holding a position worth $500. The net effect is a $500 loss, but remember that’s netted against the $100 credit you received, so it’s a max loss of $400. That math checks out as the width of the spread is $5, the credit is $1, so the max loss is 5-1=$4*100=$400.
So that’s how it works upon expiration. But lets say this position moved against you, you still have a few days until expiration, but the stock is at $120. Since there are a few days left, you probably could close the contract for a debit of $3.50 rather than the max loss debit of $5. However, since your short leg is ITM the person you sold the option to may choose to exercise their option. As a result, that would require you to take on a short position of $110*100=$11,000 per contract sold. You may not be able to afford to cover that, or your broker may not let you hold that position. So what happens is your long leg gets exercised as well resulting in you taking a max loss early. So while on paper you received a credit of $1 that could have been closed for a debit of $3.50 and your loss was only $2.50, early assignment results in you prematurely taking a max loss.
When does this happen? It typically doesn’t, since it requires the buyer sacrificing the remaining extrinsic value on the option, but it’s more likely with certain stocks. There are three different classifications of a stock that relate to it’s borrowing ability: Easy to Borrow (ETB), Hard to Borrow (HTB), and Not Available to Borrow (NTB). The harder a stock is to borrow, the more likely it is that a call is exercised early because it gives the buyer a way to acquire a stock which may not be available to them through their broker. So if you’re selling call spreads that are close to being ITM, make sure to check out the borrowing status of the stock.
2: Dividend Risk:
This risk relates to the first one discussed, as it’s just another way you risk early assignment. If a company is announcing a dividend, there will be something known as an “ex-div” date, which means that all shareholders as of that date are entitled to receive the divident, which will be distributed usually at a later date. Because of this, call buyers may exercise an out of the money call option in an effort to acquire those shares.
Remembering that exercising an option means that you sacrifice all remaining extrinsic value, another reason a buyer may exercise a call option before an ex-dividend date is that the value of the dividend announced is greater than the extrinsic value remaining in the option. Say a 100c is trading at $2 and the underlying (stock) is currently at 101. The extrinsic value is the value of the option in excess of what it would be worth upon expiration. So the extrinsic value in this situation is $1, since the 100c trading for $2 is just $1 in excess of the current strike price. If the company in question here announced a $2 dividend, an option buyer would likely exercise their call option because the $2 dividend is greater than the $1 of extrinsic value.
3: Pin Risk:
We know that if your spread finishes out of the money it’s a max gain and if both legs of your spread finish in the money it’s a max loss. But what happens when the price of a stock finishes between the two legs of your spread? Let’s take a look.
So using a 100/110c spread as an example, let’s say that the stock finishes at 105. Your long leg, which is there to protect you, is worthless so you wouldn’t exercise it. However the short leg at 100 that you sold will be exercised by the buyer since it’s ITM. As a result, you’re now short 100 shares at a price of 100 and you’ll be holding that position over the weekend. This can go both ways from here, but since we’re focused on risk let’s say that this stock you’re now short shoots up over the weekend and some sort of news/event brings it up to $120.
With this short position of 100 shares at $100 you’re borrowing $10,000 worth of stock. Now that the stock is worth $120 this position is now worth $12,000. Over the weekend you’ve sustained a $2,000 loss. If we received a credit of $3 when we opened this spread, we may have thought that our max loss was 10-3=$7*100=$700. Since we failed to close the spread out, this position has now resulted in a $2,000 loss net of the $300 credit that you received when you opened the position. So on a trade where you thought you could lose at most $700, you’re now down almost $2k.
I can’t repeat it enough, but THIS IS WHY WE CLOSE OUT SPREADS BEFORE EXPIRATION. That is the single most important takeaway I can give you here. Spreads are great since they’re defined risk and defined gain. When you’re buying options you have a defined loss but a potentially infinite gain. This can make it really easy to get greedy and I’ve seen countless traders lose big profits because they keep holding out for more. When you have a defined gain and defined loss it makes it easier to make smart decisions, take profits, and continuously build on those profits over time.
That was an enormous wall of text but I hope it helps explain, from a base level, what spreads are and how they work. Switching from buying options to selling options has dramatically changed my performance in the market so I hope sharing this can do the same for someone else. If you have any questions let me know and I’d be happy to answer them.
submitted by fuzz11 to StockMarket [link] [comments]

+3000% in 2020... My Journey to the Golden 7 Figure Mark

+3000% in 2020... My Journey to the Golden 7 Figure Mark
Hey Folks,
My first ever Reddit post and I guess I chose to make an essay of it. This post is about how 2020 has been a stellar year for me in the stock market. For context, I'm 32 and have a been trading for about 7 years. I started in 2013 with stocks and then in 2016, I switched to options trading which had disastrous consequences at first, but is also the reason I eventually managed to hit the million dollar mark. Disclosure: I have a pretty stable career completely unrelated to the finance world so a lot of this is mostly self taught, which I am sure is also the case with most readers :)
I will preface this post by saying that I am aware that there have been a bunch of success stories in the market in 2020 and by no means do I intend for my excitement and elation in sharing my story to come of as chutzpah. 2020 has been a crazy year considering the adjustments we have had to make to our lives because of Covid. The "benefit" of this has been the ability to wfh and this lifestyle change has spawned a whole new population of day traders. As an inhabitant of an area that follows Pacific Time, the 2.5 or so hours before work officially begins has been an absolute blessing for me. This additional time coupled with super favorable market conditions, gumption/balls of steel and a good technical understanding or experience of the stock market are the factors that probably led to my success. I will also say you need A LOT OF LUCK in this process. Sometimes things just work out for you in life and you ABSOLUTELY need that to even come close to achieving something like this.
Point to note: This post is going to ignore the injection and removal of some of my own funds along the way. You can assume the highest "baseline" amount I ever had in the account was around 140k. I mention starting at 11k but please note in no way is this post saying I went from 11k to >1 million.
Here's this year's action and the next few images summarize/document my crazy journey to get to this point.
BOOM portfolio as of 10/1/2020. 3000%. You can do it too!
I started trading 7 years ago. Mostly stocks. It was all good but humans have a propensity for risky behavior and I am human after all. This tendency meant that I couldn't just let my money sit in an account and grow gradually. I will admit I have a gamblerisk taker mentality and you must realize how critical this characteristic is to achieving success like this. Anyway, started dabbling in options in 2016 and I probably went about it the wrong way. My first foray into the options space was via long calls (which I realized later is actually only recommended for Options "Veterans" and not for those starting out as novice traders). Got burned A LOT along the way . I start with 11k in 2015ish and built that to about 39k by May 2017 and then literally lost more than 50% by 2019. Yuck! I know. Trust me there were days I would hate myself for being so incompetent or just displaying terrible money management. For this post, let's assume you only start seeing the action from Jan 8 2016 (image below)

The starting value here is reflected as ~100k
It's not so obvious anymore because the scale has been affected massively by the spike this year. But for clarity, my lowest point was Sep 2019 (See image below). I was heavily leveraged and this was where I was basically ready to give up. Thank god I didn't. So what changed? Read on!

https://preview.redd.it/l5ugxjuhuiq51.png?width=566&format=png&auto=webp&s=032d472e0e912f43b35547214eacdae371870311
So in retrospect, I think we were in a very bearish environment between 2018 and 2019. People don't reference it as a bear market because lots of stocks did climb in that period (and it technically wasn't a bear market) but the tariffs on the Far East really messed with a lot of trading strategies and just market movement in general. My favorite stock in the early part of wealth building was AMD! I used that to build my portfolio and get out of the rut, post 2019. I basically took all my 80-90k (46k + 100% margin) and bought long AMD calls with strikes very close to the market price it was trading at in June-Sep 2018 and expirations 4-6 months out and just waited. POTUS did us all a great favor by ending the damn tariffs and that's when this party started.
By March 2020, right before Covid, I hit 292k or so and was loving life and every minute of what I had pulled off. I will admit somewhere along the way between Oct 2019 and March 2020, I had traded NVDA and a few other large cap growth stocks given I now had all this additional purchasing power. BUT Guess what? My dumbass didn't take any profit! Or if I did, I reinvested it into the market. Remember what Mathew Mcconaughey's character says in WoWS? " They're all f**ing addicted. As brokers, we take their money out from 1 stock and dump it in another and just keep making money. Who cares about the investor!" .... So anyway, Covid strikes and BAM! my portfolio fell back to around 105k. I was pissed (I am sure many of you suffered the same fate). Thankfully, we have had a V shaped recovery (or K depending on what your political affiliation is) and I basically used the next 6 months from March till today to supercharge my portfolio to what you saw in the first image.
So here's what I learned along the way:
Disclaimer: None of what I mention in this post should be taken as financial advice. I accept no responsibility for how you do/do not use this information in your own trading strategies
  1. The power of compounding is a beautiful thing. People understand this but don't full appreciate what this can do for you. If you start at 10k, you should aim to get to 20k first before trying to fly to 100k. When you get to a 100k, make sure you don't lose a single cent and have to start again from scratch. 100k with 100k margin = 200k. That can get you an ROI a helluva lot larger than if you were to start with 10k again. Grow your money in steps but know that in the casino, to win more, you have to bet more, which in this case would be your new principal amount after you have made profit.
  2. Don't waste time trading rubbish. I see lots of new investors chasing the dollar stocks hoping they reach $10. Yes I did it with AMD but when I started trading AMD it had already gone from $3 to $16 in a year so the story was starting to build up! Penny stocks/pink sheet stocks are trash. Please don't waste your time on that. Large cap growth is the best way to make money. It's all about %. One option of TSLA or NFLX or AMZN purchased at the right time will make you a lot more than 1000 shares of a trash penny stock.
  3. Technical Indicators are your friends. Learn how to use them, particularly in a bull market. I personally love Bollinger bands and RSI. These coupled with understanding the trend in a market will give you a significantly higher chance at making money than just speculating. Also, use these to either take profits off the table or to let your winners ride. 95% of all price action takes place within the +/-2 sigma bollinger bands(hence the definition). Don't believe me? Plot the chart yourself. Use the daily indicator for short term trading. Use the 3min or 5min chart for intra day trading.
  4. If you are interesting in options trading, please go read or watch YouTube videos to understand how to get started. There is SO MUCH LITERATURE available for free. DONT PAY ANYONE to learn how to trade unless you want to contribute to the downpayment for their next Aston Martin :). Also, the Greeks didn't just give us great Mediterranean food, they are also the most important parameters in options trading. Delta and Theta should be with you at all times but dont' ignore gamma and vega. Alos understand how IV impacts your trading. The most successful/profitable strategy for me was (once I learned to do it correctly of course), buy call/put options with expiration>=2 months from the day you purchase them at a strike very close to the money. Don't worry about straddles and iron condors till you have mastered what the basics mean. Also, once you understand options and start buying them, know that writing Calls and Puts is a great way to collect premium as you grow your account. If you own shares, there's no reason you shouldn't be collecting extra income from writing calls against them. If a stock flies up too high, sell puts at 10% below the current price. In a bull market, you'll be hard pressed to find a growth stock that doesn't recover after tanking 10% in a 2 month time period.
  5. Margin is your friend. Think of margin as the mistress/boy toy. He/She can give you unreal levels of pleasure but if he/she rats you out/bails on you, RIP. Use it wisely. Finally, trust nothing but your own instinct - No one but you is responsible for how you grow your account. Don't blindly follow people unless you understand what they are proposing. Most of us learn this the hard way (including me).
  6. Take profit off the table but also let your winners run! Set yourself targets when you are in the very early stages of building your wealth. Remember the point I made about compounding? If you start at x, and make 20% on that, you are now at 1.2x. If you make 20% on that, you are now at 1.44x. I know you want to make 8x eventually but is it better to be realistic and try and grow 1.44x to 8x or go back down to 0.5x and then have to make your initial capital back and more? If your winners are up 20%, TAKE YOUR PROFIT. If you want to let it run, fine go ahead. But if you are now suddenly 50%, wtf are you waiting for? Are you going to stare at the screen hoping you suddenly see $1,000,000? That's not going to happen. Now, that said - in the current market climate which is a SEARINGLY HOT bull market, it is not unreasonable to see stocks climb 5-10% in a day. So? Take advantage of that of course but never ever let FOMO be the reason you lose out on profit.
  7. Much like point 6, realize that you need to cut your losses when things don't work out. Go check out the CANSLIM method for some guidance on what targets to set yourself. E.g. in your early stages set tell yourself that no matter what, you will take profit at 20% upside and cut losses at -10% downside. On paper, with this math you can never lose. Of course, executing this requires curbing 10 different stages of human emotion which is why most never make consistent profit in the stock market.
  8. Be greedy when others are fearful. I am at a stage now where I LOVE RED DAYS. Why? Because I know that in 24-48 hours the large cap growth stocks are going to recover and I will basically make close to 100% gains on my initial investment. Don't chase when others are chasing. Most of retail doesn't know wtf they are doing. Keep cash handy for days like this. Never be 100% invested with your entire portfolio and never be invested in a single stock unless you are very very sure based on technicals that you will see a rebound. And don't be scared to hit the buy button on a red day. Trust me, once you see it work you will instantly feel vindicated.
  9. Finally, and most IMPORTANTLY. The risk taking mentality/gambler mentality is CRITICAL to making money. You won't hear this much and it might even be a controversial statement to make but your end goal should be to place a bet on a trade which you know, based on experience, will have a favorable/profitable outcome in the near future. To execute this you need to have the guts and the belief in what you are doing but also very low aversion to risk. I will add again that YOU NEED A LOT OF LUCK and a brazen assurance in your own abilities. These will come with time and you will likely make lots of mistakes along the way. But, if you are patient enough, you will reach that level where you stop second guessing your decisions and that's the day you are on your way to your dream portfolio.

Okay, I could probably write much more and I might edit this again in future but I will stop here for now. I hope you were able to take something from this. I respect your opinions so feel free to disagree with anything, everything I have said. I am just sharing my story and always happy to hear yours too!
Good luck folks. I hope you all make boatloads of money and have very happy, enjoyable lives regardless of whether you are motivated by money or not!
-Phantas

EDIT:
Thanks for the comments everyone. I appreciate both the love and the hate. Many of you make excellent points and valid arguments both for and against what I have done.
I saw a few posts about how this might be fake. I understand that this is my first post and so it does create some doubt. Video proof below for those who had concerns on the legitimacy of the screenshots. I apologize in advance for the disparity in the numbers. Due to this morning's gains, the portfolio value in the video is significantly higher than when I made this post.

https://reddit.com/link/j3fx2video/dteq0s1njpq51/player


submitted by Different_Kick_3561 to wallstreetbets [link] [comments]

Hey hey, reposting my 45+ Productivity, Life, and Self Improvement tactics - enjoy

Hey hey, ladies and gents, I posted this on productivity and it got removed without an explanation, might have been the fact that it’s a list. But still, use this as a database, it’ll really help!
I spend dozens of hours every week researching, writing, and re-writing this type of content and making sure everyone that supports me gets exactly the kind of content they deserve. It's my job at this point.
This database/list is a Reddit first, but I'm publishing a categorized version in this week's premium email, I'm also creating a searchable database that I'll be inviting subscribers to.
I hope you enjoy this, some might sound as basic as they come but let me tell you, they help immensely.
If you want more from me, my email list which is free/paid whatever floats your goal, is on my profile.
-------------------

1. Try sleeping at the same time every night.

This habit enables you to fall asleep faster and wake up at the same time, like clockwork, all subconsciously.
Your body clock and circadian rhythms control hormones such as melatonin. Sleeping at the same time every night is one of the queues for your body to start secreting melatonin - this is why you subconsciously get tired and start yawning at a particular time when you have a routine.
There’s much more to sleep and body clock queues here.

2. Do the most challenging thing first.

This could be at the start of your day, the beginning of a project, or your study session’s first hour. After completing this task, you’ll have not only done something meaningful with your day, but you’ll feel the momentum carry through to other todo items.

3. Replace recurring decisions with routines.

Every decision you make throughout the day comes with a tiny mental tax. When you add it all up, you start performing worse at the choices that matter. So eliminate picking an outfit, deciding on breakfast, or figuring out when to workout - replace them all with a routine.
The faster you commit to pre-selecting a schedule and sticking to it, the more mentally precise and swift you’ll be when you make decisions.

4. Keep airplane mode on for the first two hours of the day.

Make the morning yours, get acquainted with how you feel, and take control of your time before others try to compete for it.

5. Avoid starting and stopping to eliminate your overhead.

When you stop a task to answer an email, help someone, or check notifications, you disrupt or altogether avoid deep work. Instead, designate a time to deal with all the ‘admin’ stuff on your schedule, not someone else’s.

6. Check external solutions to your problem before inventing a new one.

There’s a high chance that the problems you have in your work, code, studies, gym routine, etc. have been repeated.
If you’re messing up an exercise, ask the staff or check out a tutorial. Before doing some crazy code gymnastics, check out some forums. Before drafting a reporting template, see if the company already has a standard.

7. Asking is sometimes all you need to do to create your own options, uncover solutions, and learn.

We always hear, “If you never ask, the answer is always no.” So ask for a little extra, ask for an alternative, an exception, the dumb question. If you don’t ask, you won’t know and won’t receive it. A lot of the time, asking has a massive upside with almost no downside.
We don’t ask most of the time because we don’t want to be a bother - but the squeaky wheel gets the oil. Another reason goes deep into cognitive biases; loss aversion, and mastering it will help in every aspect of life.

8. Write down your mistakes and lessons learned.

We almost always repeat our mistakes; it’s too hard to remember the lessons we thought we learned. Writing them down and revisiting them helps us etch them into our memory, but doing this haphazardly isn’t as effective as systematically.
A terrific strategy is to put together a rule book or set of principles that you can always refer back to when you’re in doubt. If you can do this, it’ll be worth your time.

9. Design your environment to serve you.

Cleaning your office, eliminating distractions, getting rid of bad influences, surrounding yourself with like-minded people; these are all environment choices. Designing your environment to push yourself in the direction you desire will have a disproportionately positive effect on your success.
The essential strategy here is to reduce friction within your surroundings, and sometimes it's not so obvious - ask yourself, “What’s something that gets in my way when I’m working?” and “Can I get rid of or manage it?”

10. Identify the credible people around you.

It’s hard to decipher constructive criticism from noise. If you create a list, even a mental one, of the people who matter in their feedback, you’ll have a much easier time trusting opinions without having doubts about the quality.

11. Be aware of your mental state when making decisions.

Something as trivial as being hungry can make your emotions play a much larger role ina logical decision. Reminding ourselves and being aware of our mental state can delay making decisions until we’re better equipped to handle it.

12. Making life easier for other people makes yours easier too.

Make your customers' life easier; be rewarded with repeat customers. Make your professor's life easier; be rewarded with higher marks. Make your manager’s life easier; get promoted.

13. The right type of meditation makes all the difference.

Mindfulness, spiritual, transcendental; all that matters is that it works for you.
Yours might be going for a run and exercising focus, or having a coffee in silence while being aware of your surroundings.
Any time you take for yourself and exercise doing practically nothing, noticing when a thought comes, acknowledging it, and moving on is meditation.

14. If it takes less than a few minutes to do, just do it.

We procrastinate on many small things until they combine to become an actual problem. So doing them in the moment is the perfect way to avoid the big one.
This rule doesn’t mean disrupting deep work; that’s a form of procrastination in itself. It means that when you aren’t, you can bundle a few tasks together and be done with it in less than 10–15 minutes.
Dishes out of the dishwasher, bed made, floor swept, call returned. It’s easy and will leave a clean mental state for future you.

15. Put schedules next to your to-do list items.

This will allow you to complete the tasks, and maybe not right away, but soon enough, you’ll start to realize how many items are appropriate. Say goodbye to the endless list that’s never complete.

16. Have an overarching goal for the day.

Each night, write a single goal for the next day. If you complete this, it was a successful day.

17. When reading self-help books, case studies, papers, and biographies have a pen and notepad with you.

Underlines, notes, important chapters, paragraphs you’ve read for the 5th time, and notes that are thicker than the sections they were written about — this is how you learn.
Taking this much time and care may be the same time it takes someone else to read three books, but I’m betting you’ll come out more knowledgeable. Quality > Quantity.

18. Actively listen to the person when you’re talking to them

Ego is something everyone wrestles with because we’re inherently the center of our universe. Listening is such an immense exercise in focus, learning, and empathy that your ego level almost drops to zero.
Too many people wait for their turn to talk instead of listening. You can avoid so much miscommunication by doing this, and you’ll be better for it. This also goes for reading emails and texts.

19. Spend time refining your diet.

The level of improvement in thinking, decision-making, fitness, and productivity has significant ties with what you put in your body. This isn’t some trivial point, either.
The classic example is sugar and caffeine’s effects on performance. Protein supplements and healthy fats, an appropriate amount of carbs, all of this preparation helps. It’s likely not a placebo when someone is raving about how great they feel after switching up their diet.

20. Thank people for their hard work and acknowledge their efforts.

This costs you nothing and gives you all the benefits you could hope for. Not only is it the right thing to do, but it will enhance the collective productivity and morale in your social circles, groups, projects, teams, and companies.

21. Learn to delegate and automate.

Think about a task that you often do. Do you need to be doing it? Can you put in some investment of time or money to get rid of the job forever? Does that investment pay off?
Answering these questions will allow you to examine if it's viable to delegate or automate a routine.
Technical automation by using Zapier, Google Sheets, and other apps can be inexpensive or free. Delegating tasks by hiring the right people might win you back countless hours of your own time.
Identify. Assess. Execute.

22. Get the sleeping hours that work for you.

Don’t listen to the overworking ‘hustle’ crowd. You can get a full night's sleep and still be working hard and smart.
Your hours will yield a much higher return if you’re well-rested and switched on. So whether you need nine hours or six, do it without guilt, and plan around it for significant productivity.

23. Use the 3-second rule when you’re procrastinating.

Engage your fight or flight instinct by starting a task three seconds after realizing you’re procrastinating.
You count down from three, and once you get to zero, you just do the thing. There’s no question about it, no further dwelling, just action.
If you fail at this once, this rule will never work again. It’s a mental exercise and sounds trivial, nonsensical even, but it works.

24. Split up your regular week and blow off some steam.

It’s hard to keep the ‘go go go’ attitude sustainable, and if you’re in it for the long game, you need to have some time for play. But many people face extreme guilt when they take time off.
Don't see it as “not working,” look at it like a requirement for success and an essential ingredient for a content life, a part of the productivity cycle.
Take a Tuesday or Thursday night to do something fun, relaxing, or different. Learn to split up your week, so the days don’t melt into one.

25. Dress for the occasion.

Dressing to be productive or successful will put you in the mindset to do just that. It’s your uniform; it’s a signal to yourself that it’s time to work.
This is why we feel much more productive, dressed smartly than wearing what we’ve slept with and trying to get work done from the bed.

26. Split your work into chunks.

This helps with procrastination as well as organization. Massive projects and undertakings are often daunting and require more than willpower to tackle.
Splitting it up into chunks not only makes things more digestible, but it also gives you a sense of progress and momentum as you complete tasks.

27. Verbalize the problem.

If you’re struggling with a problem, talk it through with a friend, co-worker, or inanimate object. When you start explaining your situation, there’s a good chance that you’ll solve it.
Explaining something requires that you take out the jumbled thoughts in your head and string them together to make sense to a third party. Programmers call this Rubber Duck Debugging - explaining the issue to a rubber duck.

28. Bundle your social media distractions.

Similar to designating hours for tasks like emails. If you set a time in the day to consume Instagram, Facebook, and Twitter, you’ll be less distracted by every notification that comes in.

29. Make your communications clear and concise.

Especially for emails, dot points are a lifesaver and allow people to decipher what you’re saying quickly. Beating around the bush or being overly kind never helps.
Conveying urgency, being firm and clear will help someone solve your query faster than going back and forth until the email chain is 30 emails long.

30. The first and last two hours of your day are prime learning hours.

This is especially useful for committing things to memory like speeches and presentations. Reading, writing, re-writing, and verbalizing the content right before and right after REM sleep reduces learning friction.

31. Practice things in the worst possible scenarios first.

If you have an exam, a presentation, or a sales pitch, practice in non-ideal scenarios.
Make sure you’re tired and in an auditorium with a lot of distractions when practicing your presentation. Or you replicate the exam conditions as much as possible when doing a test exam, i.e. try not to do it in your PJs while listening to Lo-Fi Hip Hop.

32. Ask yourself whether it’s time to switch up a habit.

The more successful we become, the more habits we need to adjust. It takes a few years into mild success before you realize that you’re spending time doing certain things when it’d be more efficient to pay for the service.
What habits have you kept for a long time that may need adjusting? You could be eating healthier than the cup ramen college days, or you might not like going out as much. Assessing will help you find out.

33. Try one-word speed readers for faster reading.

Speed reading for quick information is underrated - this might not be the best thing for retention and detail, but certainly for faster information transfer. Many speed reading apps show one word at a time on the screen, allowing you to focus - you set the speed.
A quick Google search should get you the right apps and extensions.

34. Prepare and bundle your weekly tasks instead of doing them in the moment.

Typical examples are meal prep, bulk ironing clothes, and even setting up your bag for the next day. Doing this reduces friction and bandwidth throughout your week, day, or morning.

35. If you want to do continuous work, switch up the ‘type’ of work, and add variety.

This is easier for some than others. Visual and design work is different from analytical work. Sitting down and looking at a screen is different from cleaning or going to the gym, and yet it’s all productive - this is also called productive procrastination.

36. Figure out what timing increments work for you.

Some people prefer to use the Pomodoro Technique to work between 25 minutes and 1.5 hours at a time and take a short break. Others will opt to work continuously and achieve a flow state. Both options work, but they depend on your preference.

37. Color code your apps for quick access.

Color coding may or may not be worth the time. Some people prefer using the search function for quick access. Though by color-coding, you can seamlessly swipe through pages and find the app you need. We’re visual creatures, and logos are more memorable than names.

38. Use The No 7s Rule

When trying to decide whether to say yes to something, it’s a fantastic strategy not to allow yourself to give it a 7/10 - because if it’s not a “Hell Yes!” It should be a “No.”
You’re either going to give it a six or below (barely passable), or an eight and above (exciting).

39. Only have 3 things on your todo list.

Less is more, and that’s because you can focus a lot easier. You’ll have a purpose in your day when you have a simple story - I need to get X, Y, and Z done, and that’s a win.

40. Flip a coin

It’s the easiest way to make a decision and not for reasons you think.
If you’re stuck between two options, flip the coin and commit within three seconds. What will happen is that the urgency will engage your gut, and you’ll go for the opportunity you wanted anyway.

41. Optimize light exposure to sleep like a baby.

This means light exposure through sunlight during the day and artificial light in the evening. You want a lot of sunlight and minimal unnatural light - this natural cycle is how the human body evolved, and following it will make sure you sleep very well.
This cycle is built up of Circadian Rhythms to make up what we call the body clock. And among other things, natural body processes like the day/light cycle will regulate melatonin.

42. Prolonged endurance training is the surest way to clear your mind and gain a natural high.

Runners High is a real thing. When you do similar aerobic exercises like cycling and swimming, you’ll activate a flood of antidepressants and euphoriants that are naturally produced in your brain - this enables you to clear your head and will put you in a meditative state without needing to meditate.

43. The best productivity app is either a simple note app or a physical notepad.

Less is more when it comes to taking notes, and if you write them, date them, and organize them without all the bells and whistles, you’re going to have a much better time.

44. If you’re having a bad day, zoom out.

If you take your typical day and give it 100% regardless of whether luck’s on your side or not, understand that it will even out.
Yesterday may have been a high, today might be a low, and tomorrow might be somewhere in between - but if you’re consistent, there’ll be an upward trend when you zoom out to a year or decade.

45. Learn the difference between maximizers and satisficers.

There are natural maximizers and natural satisfiers. The maximizers will consider every possible option, do their research, and perfect a decision with all available information. The satisficers will pick the first option that satisfies what they’re looking for.
Maximizers will often feel overwhelmed or overthink fundamental decisions, while satisfiers can get through them quickly.
But satisficers can sometimes make poor decisions on things they could have avoided if they did the research.
There’s a happy medium of knowing when to maximize and when to satisfy. Investment fund? Maximize. Takeout? Satisfy.
This is only really learned by trial and error, but ask yourself the question when you’re mulling over your next decision: Am I maximizing when I should be satisfying? Or vice versa.
Cheers,
That’s everything for now - if you want to subscribe to my email list, just check my profile :)
submitted by safkan04 to selfimprovement [link] [comments]

[Manga] Welcome to the U19 Club: The Wonderful World of Shonen Jump Table of Contents Speculation

If you’re a manga fan, you likely know about Weekly Shonen Jump - one of the most popular magazines in Japan, this weekly anthology of comics provided us such classics as Dragon Ball, Naruto, and One Piece. Indeed, because of the prestige of WSJ, many aspiring mangaka submit their creations to Jump, hoping they can hit it big.
However, while WSJ is popular, it is also one of the most cutthroat publications out there. Because of its size, it can usually only carry around 20 different series, excluding oneshots and the like. If your manga gets published in WSJ and doesn’t immediately become a hit, editors will cancel it as soon as possible to search for another hit instead.
Anyway, on places like manga, 4chan’s /a/ board, and Twitter, a sort of speculation started. You see, every issue of Jump has a table of contents page, which simply shows the location of each series in the issue as well as the weekly author comments. However, while the order changes from week to week, the general trend is that the most popular series are located near the front, where they’re more accessible to readers, while the less popular ones are in the back.
Of course, many editors and writers for Jump have noted that the head editor is the one who has the final say in the table of contents order, so they stress that it isn’t a barometer. However, one aspect of WSJ is that the print versions (probably digital versions too, though I haven’t checked) include a survey card in each issue - readers can submit which three chapters they enjoyed the most this week, alongside any sweepstakes offers or popularity polls. And there have been plenty of cases where a series ranks fairly high on the ToC and then suddenly drops to the bottom on chapter 8, which has led people to realize that it usually takes seven weeks to accurately tally survey results. So while it may not be 100% accurate, it allows people to speculate over which series are thriving and which are likely to be cancelled.
Case 1: The start of the U19 club
Of course, as mentioned above, the cutthroat nature of Jump means that low-performing books will be cancelled in about three to four volumes. However, at the time there was no real way to describe this phenomenon. That all changed in 2017.
See, at the time, WSJ was going through a massive series exodus. Popular series such as Bleach, Toriko, and Kochikame had all ended in 2016 (note: the latter had been running for 40 years), and Jump really needed something to prop up sales. To that end, they announced an unprecedented event where, for six weeks straight, they would add a new series in each issue. Usually, whenever series get serialized in Jump, they’re done in groups of two or three, so it was clear that WSJ was looking for at least some hits.
Enter U19, a series that made readers wonder how the hell it got approved in the first place. The premise is that adults have converted Japan into a 1984-like dystopia involving abusive discipline and selective breeding in order to strengthen the country and bring it back to its World War II-era glory. The main character finds out that his love interest has been deemed an elite student while he’s an F-rank, and when she is separated from him he develops a power called Libido, which manifests as a sewing needle that grows more powerful when he sees her. Then he is joined into the ranks of the U19 club, an underground resistance full of people under the age of 19 with similar Libidos.
The description I gave it in the previous paragraph does not do this series justice. The art was fairly amateur, the concept of Libidos were just quirks from My Hero Academia with a different name, the villains were written to be cartoonishly evil, and in general it didn’t seem like the author knew what they were doing. It quickly was cancelled after 17 chapters, but a edit of one of the spreads by a 2chan user, where the members of U19 were replaced by characters from other short-running series, eventually blossomed into a meme. From then on, the U19 club became the unofficial way to refer to any series doomed to end in less than 19 chapters. People who saw the TOC rankings would soon gravitate to the bottom of the list, speculating over which series were likely to join the club.
Case 2: The battle of the gag manga
Okay, when I mentioned the idea of the table of contents, there was one part I glossed over. While the lower-ranked series were almost doomed to fail, for a couple of years the last series to be featured in the ToC would usually be a small comedy series. The idea being that no matter how unsettling or uncomfortable the rest of the books are, at the very least the magazine will always end on a happy note. For the longest time, this position was filled by Isobe Isobee Monogatari, but then it ended in 2017.
So in a September 2018 issue, to the surprise of everyone, two gag series premiered in the same issue at the same time. The first, I’m From Japan, was about a young boy who is obsessed with the various prefectures of Japan and uses them in fighting styles. The second, Teenage Renaissance David, reimagined the Michelangelo sculpture as a hot-blooded high school student. It was clear that Jump was hedging its bets on a new gag series to be their mainstay, but the question was: which one?
There was obviously a regional gap for this issue. Japanese fans were more likely to enjoy I’m From Japan, simply because the various puns and in-jokes made more sense to them. Western fans found Teenage Renaissance David better, because the classical art references were more familiar. What compounded the issue even more is that every issue, the two series would switch places - one would be in the middle of the magazine, while the other would be near the bottom. Compounding this issue was the unbelievable fact that in December of the same year, I’m From Japan was confirmed to have an anime in development (for reference, most Shonen Jump manga only get an anime greenlighted after at least a year of serialization, while IFJ had only been around for a few months at best - meaning an anime was planned before the series even started).
While western fans were in disbelief, people soon came to the realization of why IFJ was promoted over David - tourism. The fact was that IFJ basically had every chapter talk about the top exports, notable attractions, and famous people of each Japanese prefecture - which made it perfect in terms of advertising people to go to those prefectures in question. Ultimately, Teenage Renaissance David ended after 35 chapters, while I’m From Japan was transferred to sister magazine Saikyo Jump... only to end after 45 chapters. In the end, nobody won, although the author of Isobe recently started a new serialization that may become the new gag series.
Case 3: Chew Harder - The Tale of Samurai 8
While most of the titles I’ve been talking about so far have been obscure, you most likely know about Naruto. The ninja manga was published in Jump in 1999, and author Masashi Kishimoto made it into a massive work spanning over 70 volumes and 15 years. It’s arguably one of the most popular series to have ever ran in Jump.
So it was surprising to hear that after Naruto ended, Kishimoto noted that he actually had plans for a new series. In late 2018, more information came out - his new publication would be called Samurai 8: The Tale of Hachimaru, and it would be a science fiction title centered around cybernetic samurai. Notably, due to wanting a break from drawing, he would only write the series while one of his former assistants, Akira Obuko, would be doing the art.
Considering that such a famous author would be writing another series, Jump immediately went to advertising S8 however it could. Animated YouTube ads done months before the series actually started, expansive murals in subways, even putting pamphlets of the first chapter in other Jump manga. While it had done some promotional acts for other manga before, it was on a completely different level with Samurai 8. In essence, they were setting it up to be one of the core pillars of Jump before it even started.
And then the series actually started. While some people were optimistic, others noted that it wasn’t exactly a good start for the series. From the first chapter alone, the reader is bombarded with samurai lore that would honestly be better suited for explanation across chapters rather than in a massive exposition dump. The plot also became more complex - while the first chapter of Naruto framed the conflict as a plucky young ninja possessed by a demonic nine-tailed fox wanting to become the head of his village, the first chapter of Sam8 framed the conflict as a sickly young boy who wants to become a samurai, only to suddenly get a cybernetic body after committing seppuku and then he is told by a blind samurai master in a cat’s body that he must find the seven keys to Pandora’s Box, an artifact that could endanger the whole galaxy. The artstyle used to portray cybernetics made pages look cluttered, which made fight scenes difficult to understand.
In essence, while Samurai 8 had the prestige of being written by the author of Naruto, everything else seemed to be changed - not necessarily for the better. Compounding this were two separate facts. The first is that when the first and second volumes of the series were released simultaneously (another marketing stunt to encourage binge reading), Kishimoto wrote in the first volume that he would compare reading Samurai 8 to chewing dried squid - if the flavor doesn’t come out, just chew some more (i.e. buy the second volume, I swear things will get better I promise). The second was an interview with one of the former editors of Naruto, which revealed that many of the most popular parts of Naruto were editor suggestions rather than Kishimoto’s own work. Compounding this was an interview with the Samurai 8 editor, who seemed to revere Kishimoto; this made fans believe that he wasn’t policing Kishimoto’s work as much, similar to how George Lucas made the original Star Wars trilogy with the help of various editor suggestions and then the prequel trilogy with virtually no supervision.
The effects were noticeable. In 4chan, it became a meme to refer to Kishimoto’s chewing comment whenever Samurai 8 was discussed. TOC-wise, it dropped in the rankings until it was almost always near the bottom. Sales were night and day compared to Naruto, and ultimately, after the constant promotions over other WSJ series, Samurai 8 ended after five volumes and 45 chapters. Which seems okay enough until you realize that I’m From Japan, of all series, was compiled into six volumes.
Case 4: Time Plagiarism Ghostwriter
In May 2020, the same issue when one of Jump’s more popular series Demon Slayer ended, a new series called Time Paradox Ghostwriter started.
The premise of it went like this: An amateur author whose manga has been rejected by publishers constantly gets his microwave struck by a bolt of lightning, which turns it into a time machine. When he opens it up, he sees that it contains a copy of Weekly Shonen Jump from ten years in the future. Upon seeing that its premiere series, White Knight, is the perfect manga, but believing it to be a dream, he copies the first chapter the following day and sends it to his editor, who immediately greenlights it as a series. Suddenly the amateur author must contend with the high expectations pushed onto him - as well as the original author of White Knight, who is surprised that someone else has used her idea.
Maybe it was because of the premise alone. Maybe it was because it was one of the few Jump manga out there which didn’t fall into the typical conventions of being a battle, sports, or gag manga. Either way, TPGW immediately became popular in the west, with many people talking about how they love it. Many were immediately convinced that TPGW could immediately become a top seller for Japan. So, seven weeks after the first chapter, people were eager to see the first ratings for the series - only for it to debut in the bottom half of the magazine and drop lower every issue afterward.
People were surprised, to say the least. Why was a series with such an amazing premise flopping? Pretty soon, people came to a conclusion as to why this was happening: plagiarism. More specifically, in a magazine primarily aimed at young boys, the first few chapters tried to justify the main character plagiarizing White Knight and still paint him as a good guy, by having people constantly tell him that so many people are in love with WK and it would be a disservice to stop now. Even the original author, after meeting the main character, writes off the similar plot between his White Knight and hers as a fluke. And given how the Kyoto Animation Fire, one of the worst mass murders in Japan’s modern history, was caused because someone thought KyoAni had stolen their idea, it makes sense that people would be hesitant to like a series which pushes all of its consequences to the side.
So anyway, the first volume of TPGW was released, compiling all the magazine chapters while removing any reference to plagiarism in the text itself. Even then, it sold terribly. The author quickly tried to pick up the pace of their manga, glazing over plot points and moving the story at a breakneck pace, but it was too little too late. The series ended in only 15 chapters - unusual for Jump, as even more recent U19 series have gotten more time before getting axed. People were upset, claiming that Japan just didn’t have as good of a taste as the west and being upset that the previously-mentioned gag manga by Isobe’s author was immediately started the week after. So yeah, people were upset.
Anyway, that’s the long and short of some notable instances of Jump drama. I could add in some more stuff, like the quick cancelling of Act-Age or the drama surrounding mangaka like Kentaro Yabuki and Haruto Ikezawa, but I’ve written enough as is.
submitted by Torque-A to HobbyDrama [link] [comments]

General Election Polling Discussion Thread (Aug 9, 2020)

Introduction

Welcome to the /politics polling discussion thread for the general election. As the election nears, polling of both the national presidential popular vote and important swing states is ramping up, and with both parties effectively deciding on nominees, pollsters can get in the field to start assessing the state of the presidential race.
Please use this thread to discuss polling and the general state of the presidential or congressional election. Below, you'll find some of the most recent polls, but this is by no means exhaustive, as well as some links to prognosticators sharing election models.
As always though, polls don't vote, people do. Regardless of whether your candidate is doing well or poorly, democracy only works when people vote, and there are always at least a couple polling misses every cycle, some of which are pretty high profile. If you haven't yet done so, please take some time to register to vote or check your registration status.

Polls

Below is a collection of recent polling of the US Presidential election. This is likely incomplete and also omits the generic congressional ballot as well as Senate/House/Gubernatorial numbers that may accompany these polls. Please use the discussion space below to discuss any additional polls not covered. Additionally, not all polls are created equal. If this is your first time looking at polls, the FiveThirtyEight pollster ratings page is a helpful tool to assess historic partisan lean in certain pollsters, as well as their past performance.
Poll Date Type Biden Trump
YouGov 8-9 Pennsylvania 49 43
YouGov 8-9 Wisconsin 48 42
Global Strategy Group 8-7 National 49 45
Zogby Interactive 8-7 National 46 46
Zogby Interactive 8-7 National 46 46
Zogby Interactive 8-7 National 46 45
Trafalgar Group 8-7 Texas 43 49
Public Policy Polling 8-7 Kansas 43 50
Research Co. 8-7 National 48 38
EPIC-MRA 8-7 Michigan 51 40
Harris Insights & Analytics 8-5 National 43 40
RMG Research 8-6 Iowa 40 41
Quinnipiac University 8-6 South Carolina 42 47
Quinnipiac University 8-6 Maine CD-1 61 30
Quinnipiac University 8-6 Maine CD-2 44 45
Quinnipiac University 8-6 Kentucky 41 50
Quinnipiac University 8-6 Maine 52 37
David Binder Research 8-6 Michigan 51 41
David Binder Research 8-6 Wisconsin 53 42
David Binder Research 8-6 Minnesota 54 36
David Binder Research 8-6 Iowa 49 43
DFM Research 8-6 Oklahoma 36 56
Data for Progress 8-6 Maine 53 43
Data for Progress 8-6 Iowa 45 46
Data for Progress 8-6 Maine 49 42
Data for Progress 8-6 North Carolina 49 45
Data for Progress 8-6 North Carolina 46 44
Data for Progress 8-6 Iowa 42 44
Data for Progress 8-6 Arizona 47 44
Data for Progress 8-6 Arizona 45 43
Bluegrass Voters Coalition 8-5 Kentucky 34 55
Morning Consult 8-5 Indiana 38 55
Bluegrass Voters Coalition 8-5 Kentucky 45 52
Ipsos 8-5 National 54 45
Ipsos 8-5 National 56 44
Marquette University Law School 8-5 Wisconsin 52 44
Marquette University Law School 8-5 Wisconsin 49 45
Rasmussen Reports 8-5 National 48 45
Monmouth University 8-5 Iowa 46 48
Monmouth University 8-5 Iowa 45 48
Monmouth University 8-5 Iowa 47 47
YouGov 8-5 National 49 40
Zogby Interactive 8-5 North Carolina 44 40
Zogby Interactive 8-5 Florida 43 43
Zogby Interactive 8-5 Ohio 43 41
Zogby Interactive 8-5 Pennsylvania 44 43
MRG Research 8-5 Hawaii 56 29
Hodas & Associates 8-5 Wisconsin 52 37
Hodas & Associates 8-5 Michigan 52 40
Hodas & Associates 8-5 Pennsylvania 50 44
University of California, Berkeley 8-4 California 67 28
Morning Consult 8-4 National 50 43
Morning Consult 8-4 National 50 43
Morning Consult 8-4 National 50 43
Morning Consult 8-4 National 51 42
Morning Consult 8-4 National 51 42
Morning Consult 8-4 National 51 42
Morning Consult 8-4 National 50 43
Morning Consult 8-4 Texas 47 46
Morning Consult 8-4 South Carolina 44 49
Morning Consult 8-4 Kentucky 35 59
Morning Consult 8-4 Alabama 36 58
Fox News 8-3 National 48 41
Public Policy Polling 8-3 Michigan 49 43
Global Strategy Group 8-3 Wisconsin 51 42
Emerson College 8-3 Montana 45 54
Center for Marketing and Opinion Research 8-3 Ohio 45 41
YouGov 8-2 Georgia 46 45
YouGov 8-2 North Carolina 48 44
Emerson College 7-31 National 53 46
YouGov 7-31 National 49 40
Data for Progress 7-31 National 51 42
Data for Progress 7-31 National 50 43
Public Policy Polling 7-31 Minnesota 52 42
University of New Hampshire 7-30 New Hampshire 52 39
University of New Hampshire 7-30 New Hampshire 44 46
University of New Hampshire 7-30 New Hampshire 53 40
IBD 7-30 National 48 41
Virginia Commonwealth University 7-30 Virginia 50 39
Redfield & Wilton Strategies 7-30 Wisconsin 45 35
Redfield & Wilton Strategies 7-30 Michigan 49 37
Redfield & Wilton Strategies 7-30 Arizona 46 38
Redfield & Wilton Strategies 7-30 Pennsylvania 48 41
Redfield & Wilton Strategies 7-30 North Carolina 43 42
Redfield & Wilton Strategies 7-30 Florida 48 41
Franklin & Marshall College 7-30 Pennsylvania 50 41
Cardinal Point Analytics (CardinalGPS) 7-30 North Carolina 46 48
Mason-Dixon Polling & Strategy 7-30 Florida 50 46
Harris Insights & Analytics 7-29 National 55 45
Optimus 7-29 National 47 40
Optimus 7-29 National 38 31
TargetPoint 7-29 Michigan 49 33
Rasmussen Reports 7-29 National 48 42
Monmouth University 7-29 Georgia 47 47
Monmouth University 7-29 Georgia 47 48
Monmouth University 7-29 Georgia 46 49
YouGov 7-29 National 49 40
Zogby Interactive 7-29 National 44 40
Ipsos 7-29 National 57 43
Ipsos 7-29 National 57 43
Change Research 7-29 Pennsylvania 48 46
Change Research 7-29 Florida 48 45
Change Research 7-29 National 51 42
Change Research 7-29 Arizona 47 45
Change Research 7-29 Michigan 46 42
Change Research 7-29 Wisconsin 48 43
Change Research 7-29 North Carolina 49 46
SurveyUSA 7-28 Washington 62 28
Morning Consult 7-28 Wisconsin 49 44
Morning Consult 7-28 North Carolina 46 49
Morning Consult 7-28 Michigan 50 42
Morning Consult 7-28 Minnesota 49 42
Morning Consult 7-28 Florida 47 48
Morning Consult 7-28 Ohio 42 50
Morning Consult 7-28 Virginia 52 42
Morning Consult 7-28 Pennsylvania 48 44
Morning Consult 7-28 Texas 43 50
Morning Consult 7-28 Georgia 47 49
Morning Consult 7-28 Colorado 50 42
Morning Consult 7-28 Arizona 45 47
Colby College 7-28 Maine 50 38
Colby College 7-28 Maine CD-1 55 35
Colby College 7-28 Maine CD-2 45 42
Public Policy Polling 7-28 Montana 45 50
Public Policy Polling 7-28 North Carolina 49 46
Public Policy Polling 7-28 Alaska 44 50
Public Policy Polling 7-28 Maine 53 42
Public Policy Polling 7-28 Georgia 46 45
Public Policy Polling 7-28 Colorado 54 41
Public Policy Polling 7-28 Iowa 47 48
DKC Analytics 7-28 New Jersey 51 33
MassINC Polling Group 7-28 Massachusetts 55 23
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 43
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 43
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 43
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 50 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 51 42
Morning Consult 7-28 National 48 44
Morning Consult 7-28 National 49 44
Morning Consult 7-28 National 49 43
Morning Consult 7-28 Minnesota 47 44
Morning Consult 7-28 Texas 47 45
Morning Consult 7-28 Michigan 52 42
Morning Consult 7-28 Georgia 47 46
Morning Consult 7-28 North Carolina 47 47
Morning Consult 7-28 Ohio 45 48
Morning Consult 7-28 Pennsylvania 50 42
Morning Consult 7-28 Virginia 52 41
Morning Consult 7-28 Florida 49 46
Morning Consult 7-28 Wisconsin 50 43
Morning Consult 7-28 Colorado 52 39
Morning Consult 7-28 Arizona 49 42
ALG Research 7-27 South Carolina 45 50
Trafalgar Group 7-27 Minnesota 49 44
brilliant corners Research & Strategies 7-27 South Carolina 43 50
Harris Insights & Analytics 7-27 National 55 45
Kaiser Family Foundation 7-27 National 47 38
Marist College 7-27 North Carolina 51 44
AP-NORC 7-27 National 46 34
YouGov 7-26 National 51 41
YouGov 7-26 Michigan 48 42
YouGov 7-26 Ohio 45 46
Marist College 7-26 Arizona 50 45
SSRS 7-26 Michigan 52 40
SSRS 7-26 Arizona 49 45
SSRS 7-26 Florida 51 46
Gravis Marketing 7-25 Pennsylvania 48 45
Echelon Insights 7-24 National 52 43
Echelon Insights 7-24 National 51 41
Echelon Insights 7-24 National 49 40
Echelon Insights 7-24 National 53 38
Echelon Insights 7-24 National 50 37
Gravis Marketing 7-24 Michigan 51 42
Gravis Marketing 7-24 Wisconsin 50 42
Data for Progress 7-24 National 49 43
Data for Progress 7-24 National 49 43
Fox News 7-23 Michigan 49 40
Fox News 7-23 Minnesota 51 38
Fox News 7-23 Pennsylvania 50 39
Global Strategy Group 7-23 National 50 39
Garin-Hart-Yang Research Group 7-23 National 51 43
GQR Research (GQRR) 7-23 National 55 44

Election Predictions

Prognosticators

Prognosticators are folks who make projected electoral maps, often on the strength of educated guesses as well as inside information in some cases from campaigns sharing internals with the teams involved. Below are a few of these prognosticators and their assessment of the state of the race:

Polling Models

Polling models are similar to prognosticators (and often the model authors will act like pundits as well), but tend to be about making "educated guesses" on the state of the election. Generally, the models are structured to take in data such as polls and electoral fundamentals, and make a guess based on research on prior elections as to the state of the race in each state. Below are a few of the more prominent models that are online or expected to be online soon:

Prediction Markets

Prediction markets are betting markets where people put money on the line to estimate the likelihood of one party winning a seat or state. Most of these markets will also tend to move depending on polling and other socioeconomic factors in the same way that prognosticators and models will work. Predictit and Election Betting Odds are prominent in this space, although RealClearPolitics has an aggregate of other betting sites as well.
submitted by galleyest to politics [link] [comments]

A Comprehensive Guide to Trading Credit Spreads-- A follow-up to my original theta gains post

I was hesitant to post this here at first because my gains post I submitted received some criticism about whether or not my approach to spreads was a true "theta gang" strategy. That point is probably still a little bit contentious but I get a lot of questions about my strategy from readers in this sub so I figured I would post it here. I will offer the disclaimer that this is a little risker of an approach to spreads due to my timeframe, but I think the advice it offers (regardless of timeframe) is helpful. I will also add that this is only 50% of the complete strategy I run, so I'll try to throw together another in-depth post about the other half of my strategy if it gets enough interest.
So I first dipped my toes into options trading a few years ago. I had previously been swing trading stocks so I had a couple years of experience before that, but the leverage and potential returns that options provided really piqued my interest. After it was all said and done, I lost almost $20,000 buying options. After realizing that someone was getting all of this money I was losing, I learned about option selling and haven’t looked back since.
I recently posted my YTD performance here, and received a lot of questions about how I did it. My strategy changed over time, but I first started with credit spreads, which may be applicable to more people since it’s a strategy that works with smaller accounts too. I got a lot of questions about how I played credit spreads and it’s tough to completely explain what I do through a comment here and a comment there so I created this guide explaining my exact approach to trading credit spreads. Here you go:
This is a wall of text, so if you're a more visual learner, here's a link to videos explaining all four parts:
Part One
Part Two
Part Three
Part Four

Part One: The Basics

So what is a spread? A high level conceptual explanation is that you’re essentially betting on a stock to finish above or below a certain price upon expiration. One of the advantages here is that you can set this number out of the money, so if a stock is trading at $100, you can bet that it’ll remain below $110 by a certain date. This is a bearish position, so if you’re correct and it goes down, you’ll make max profit. The catch though is that even if you’re wrong, you basically have a 10% upward cushion before you start to lose any money. So the easiest way to describe it is a strategy that lets you make money if you’re right, but also make money if you’re slightly off.
How does it work? So in the above example, if we were bearish on a stock we would open what’s called a call credit spread. We could set it up where we sell a 110c for a credit of $1.50, and buy a 115c for a debit of $0.50. This means that in this transaction we receive $1.50, and pay $0.50 for a net credit of $1. That credit is your max profit on the play. If you’re familiar with options you’ll know that if the stock finishes at or below $110 upon expiration, both of these calls will be worthless. That’s great news for us because the long leg we bought (115c) for 0.50 will be a loss, but we’ll get to keep the full $1.50 from the short leg (110c) that we sold, resulting in us realizing our max gain on the trade of $1.
Why not just sell the 110c and collect the full $1.50? While it cuts into our profits, the reason we buy the 115c in this example for $0.50 isn’t to cut into our profits when we’re correct, but rather protect us when we’re wrong. If the stock in the example stays below $110, we’re good to go and we’ll hit max profit. But what if it goes to $120, $150, or something crazy happens and it hits $200. If the stock hits $150 upon expiration, that 110c that we sold for $1.50 will be worth $40, meaning that we’ll incur a $3,875 loss in pursuit of a $150 gain. We’ve seen crazy run ups from the likes of TSLA and ZM lately, and people who sold what we call “naked options” got absolutely killed. With our spread, yes our 110c will be worth $40 meaning we’re down $4,000 on that position, but the 115c we bought behind it will be worth $35 meaning we’re up $3,500 there for a net loss of $500. Additionally, we get to keep that $1.00 credit we received up front no matter what, so our loss with this spread is actually $500-$100=$400 as opposed to the $3,875 loss that we would’ve seen had we sold the 110c by itself. THAT is the value in selling a spread as opposed to a naked option.
Why are you multiplying everything by 100? Each options contract is worth 100 shares, so a contract that is trading for $1.50 actually costs $150 to purchase.
Another high level point I like to make is that there are really 5 different things that can happen when you make a play. Let’s say you think a stock will go up. It can (1) go up a ton and you’d be correct, (2) go up a little and you’d be correct, (3) trade flat and you’d be incorrect, (4), go down a little and you’d be incorrect, or (5) go down a lot and you’d be incorrect. With a bullish spread, you’d hit max profit on 4/5 , or 80% of the possible outcomes, whereas if you bought stock or purchased an option you’d only be profitable on (1) or (2). Obviously the actual outcomes are a little more complex, but for a base-level understanding of the advantages a spread provides, I think this is a good way to look at it.
So that’s the value of a spread. A lot of traders are introduced to option selling and are scared of the prospect of incurring a huge loss like we mentioned above, but using credit spreads is a great way of receiving the benefits that selling has to offer while limiting a lot of the risks. So let’s move onto actually opening a spread.

Part Two: Making the Trade

So for actually opening a spread up, we have a four-step approach we take: Pick a Stock Pick a Direction Pick a Strike Price Execute the Trade
1: Picking a Stock:
One of the most important things I tell people is to trade what you know. I have a watchlist of 25-30 stocks that I watch and get familiar with during the day. That way if I recognize a good opportunity, I’ll have a decent base of knowledge to rely on to make what I feel is a smart play. It’s super easy to get caught up in the “stock of the week” and try to jump in on a play because a ticker is in the news. If you’re not familiar with a stock, don’t trade it.
For this example (the one used in the video), Wayfair was trading in a 195-210 range for a little bit and then had a big day where it broke up out of that range and up towards $220. This was an unusual move that I noticed since it was on my watchlist, so I decided to make a play.
STOCK: WAYFAIR
2: Picking a direction:
So if we look at Wayfair’s YTD chart, it has exploded this year. A clear upward trend, but a recent trend that I noticed from following the stock was that every time it broke out like this, there would be a little bit of a pullback afterwards. Additionally, I felt the stock was overvalued on a fundamental basis (had a negative book value at the time of the trade) so I wanted to play this stock back down. This is probably the quickest and easiest step of the four, since you’ll likely already have an opinion on most of the stocks that you follow.
DIRECTION: DOWN
3:Picking a Strike Price:
So we know that we’re going to be playing Wayfair back down, but now the question is what spread are we going to set up to do that. In this example Wayfair was trading at $218.42 at the time that we decided to make this trade. In the video we illustrate a trading channel that Wayfair was at the top of. It was also approaching the ATH of $221.54. A lot of the time that will act as resistance for a stock, meaning it’ll bounce down off of it. So in order to give ourselves a bit of a cushion we decided to set our short leg at 222.50, meaning that we’re playing the stock to stay below $222.50 by the end of that week.
So with this play it means in plain English that if we’re correct and the stock goes down, we hit max profit. But if we’re wrong and it goes up, we still have a $4.08 cushion before we’re not hitting max profit anymore. So we could be a little wrong, have the stock go up a few dollars, and still walk away with max profit.
STRIKE PRICE OF SHORT LEG: $222.50
4: Executing the Trade:
I’ll be the first to tell you that when I started trading spreads I didn’t realize you could open both legs of the spread at was. I was stupid. I would like to think I’m at least a little bit smarter now. If you look at the options screen for most brokers, you’ll just see single legs. Switching over to “vertical” allows you to set up the entire spread in one trade. If you use something like RH, there’s a feature that allows you to select multiple options, so you’ll select the one you wish to sell (short leg) and the one you wish to buy (long leg).
In this example we selected the 222.5/227.5c spread, meaning that we sold the short leg of 222.5 and the long leg of 227.5. The net credit was 1.45, which is our max gain on the trade. A wider spread gives a larger credit but also increases max loss. This is a $5 wide spread but we could have made it a tighter spread with a $2.5 width. Typically the best risk to reward ratio is on the tightest spreads, but a slightly wider spread will raise your breakeven price and studies have shown that it actually results in better expected value long term.
Circling back to the credit we received of $1.45, this means that our max profit was $145 and our max loss was $355 for each spread that we sold. We know that because our broker tells us that, but a quick way to calculate it is the width of the spread minus the credit. A $1.45 credit on $5 wide spread means a $5-$1.45=$3.55 max loss.
When I evaluate trades like this I look for a max profit to max loss ratio of 1:2 to 1:4. Based on different scanners I’ve seen, the best expected values tend to fall on spreads within that risk/reward ratio. The ratio on this trade is 1:2.44.
So we put our order in for a credit of $1.45, it filled, and now we get to sit back and watch. Sometimes your order won’t fill right away. In fact, most of the time it won’t fill right away. It’s important to be patient with your fill price and not chase it downwards. We want the highest credit possible. So if the credit on these spreads dropped to 1.30 when I was trying to place an order, it usually isn’t a great idea to drop my order price down to 1.30 just to get a fill. The only time I would recommend that is if you’re trying to open a spread right before the market closes. Otherwise, hang tight. Patience pays.

Part 3: Managing the Trade

So now that we’ve made the trade, it’s time to manage it. In my opinion one of the best parts about trading spreads is that they don’t require active management. You get to sit back and watch the price. Once the trade has been opened, which is also quick, it takes very little effort.
So with the Wayfair example we used, our analysis turned out perfectly, as Wayfair touched the ATH and dipped back down to end the week safely at $214. We hit max profit on that trade, but what if the trade goes against us? That’s what we’ll take a look at in this section.
One thing we didn’t address in part two is when to open the trade. We like opening spreads on Mondays and Tuesdays, and monitoring them during the week. This is the part of my strategy that is a little bit controversial, as there is a (legitimate) school of thought that selling spreads about 45 DTE is better value. I like that idea and if you would rather do that then absolutely go for it. It’s important to trade what you’re comfortable with. All of the lessons in here still apply to that strategy. With that said though, I stick with the weekly strategy of opening them at the beginning of the week and look to close them throughout the week.
The way I see it, your % of max profit should be the metric you’re looking at when deciding what to do with a spread. Divided up equally, that means if you progressed through the week to max profit in a linear fashion, you would be at 20% of max profit on Monday, 40% on Tuesday, and so forth. A good rule of thumb I use is that if you’re ever on the fence about whether or not to close something out, do so if your return exceeds the linear return for that day of the week. The market can move quickly and I’ve had several times where I have regretted not closing a spread out. It’s important to take profit.
Another thing I’ll add to this is that this weekly strategy gets a little risky on Thursday afternoon headed into Friday. If your spread is remotely close to being in the money on Thursday afternoon, close it out. Now that I type that out I realize that may all sound a little convoluted, but it’s better visualized in the video I’ve linked for this section.
Now let's get into what happens if a trade really starts to move against you. With the strategy we use there are really two options: (1) Close the trade for a loss and move on, or (2) Roll the strikes higher.
The first option is pretty self explanatory, but a quick note I want to add here is that you can have a stock move way against you but still be able to close the trade for less than max loss. The example I use in my video is I played FB earnings, thought it would go down, but it shot way above my spread and well into max loss territory. We opened a 245/247.5c spread for a credit of $0.54. FB was reporting earnings on a Thursday night and we sold this spread that expired the following day, so there wasn’t a ton of time to manage it. Long story short, FB killed earnings and shot up to $256 that morning. Really not a prayer that it would come back down to the spread I opened by the end of the day. But despite the fact that this trade went way against us and we had almost no time to manage it since it was a Friday play, we were still able to close out for a debit of $1.90. Yes that’s a loss of $1.36 per spread, but we SAVED an additional $0.60 cent loss by avoiding a max loss debit of $2.50. That’s another benefit of spreads.
Let’s talk about option two. This is the best option to use if you’re confident that you’re correct about the ultimate price action on a stock, but you need a little extra wiggle room on the trade. For this example we’ll look at a TSLA call spread that I opened. TSLA was trading at $1542 after an incredible run, so I figured I would play it below 1600 with a 1600/1610c spread that offered a credit of $2.52. As is the theme with this section, TSLA exploded the following morning (Tuesday) and went all the way up to $1794 at one point. My spread was literally almost $200 out of the money. One of the biggest possible moves against myself that I had ever seen. Despite this crazy move, it was only Tuesday and we were able to close the first spread for a debit of only $5.25 (as opposed to a $10 max debit). We opened 6 of these off the bat so this was a loss of $1638. From there we “rolled” our strikes higher, opening 10 1750/1760c spreads for a credit of $3.45. So the closing and subsequent opening of a spread like we did here is what we are referring to when we say we “rolled the strikes higher”.
By the end of the week TSLA had finally crashed a bit and it finished at $1506. This meant the second of spreads we opened were easily max profit. And while we lost $1,638 on the first set of spreads we opened here, we profited $3,450 on the second set of spreads so we were able to still finish the week with a $1,812 profit on TSLA. The funny thing with this one is that the original spread would have hit max profit since it dropped all the way back down to 1500, but we would have had the same result had TSLA finished anywhere below 1750.
Rolling the strikes higher gave me extra breathing room and turned a potential disaster into a profitable trade. One thing I’ll add though is that with this method you do run the risk of increasing your potential max loss. Because of that, I’ll only roll my strikes higher ONCE. Anything past that is chasing a losing trade. If I roll my strikes higher and it’s still going against me, I’m at the point where I need to accept the fact that I don’t fundamentally understand a stock as well as I thought I did and move on. There is always another trade out there.
The final point I’ll add to this is ALWAYS CLOSE OUT YOUR SPREADS. The only time I’ll let a spread expire worthless is if my spread is OTM by a crazy amount and it would quite literally take a historic after-hours move on Friday to take me back ITM. Other than that, close your spreads out. Even if it’s just for a $0.05 debit. It may seem annoying but I’ll tell you why in the following section.

Part 4: Additional Risks and Considerations

I will start this section by saying I’ve never been impacted by any of the following risks, but it’s important to be aware of 100% of the possible outcomes of your trade before you enter it. They’re infrequent but this really wouldn’t be a comprehensive guide if I omitted them. They are as follows: (1) Early Assignment, (2) Dividend Risk, (3) Pin Risk.
1: Early Assignment:
The best way to start this section is by talking about why your max loss is actually your max loss. We know it’s quickly calculated as the width of your spread minus the credit, but why is that?
Let’s use a 110/115c spread as an example. We’ll say we received a credit of $1. We know that if the stock finishes anywhere below 110 then both legs are worthless and we’ll hold onto that $1 credit. But what happens if we’re in a max loss position. Let’s say the stock finishes at $120.
In this situation the short leg (110c) we sold would be worth $10 (120-110), meaning that we would owe $1,000 on that position. The long leg we bought would be worth $5 (120-115), meaning we are holding a position worth $500. The net effect is a $500 loss, but remember that’s netted against the $100 credit you received, so it’s a max loss of $400. That math checks out as the width of the spread is $5, the credit is $1, so the max loss is 5-1=$4*100=$400.
So that’s how it works upon expiration. But lets say this position moved against you, you still have a few days until expiration, but the stock is at $120. Since there are a few days left, you probably could close the contract for a debit of $3.50 rather than the max loss debit of $5. However, since your short leg is ITM the person you sold the option to may choose to exercise their option. As a result, that would require you to take on a short position of $110*100=$11,000 per contract sold. You may not be able to afford to cover that, or your broker may not let you hold that position. So what happens is your long leg gets exercised as well resulting in you taking a max loss early. So while on paper you received a credit of $1 that could have been closed for a debit of $3.50 and your loss was only $2.50, early assignment results in you prematurely taking a max loss.
When does this happen? It typically doesn’t, since it requires the buyer sacrificing the remaining extrinsic value on the option, but it’s more likely with certain stocks. There are three different classifications of a stock that relate to it’s borrowing ability: Easy to Borrow (ETB), Hard to Borrow (HTB), and Not Available to Borrow (NTB). The harder a stock is to borrow, the more likely it is that a call is exercised early because it gives the buyer a way to acquire a stock which may not be available to them through their broker. So if you’re selling call spreads that are close to being ITM, make sure to check out the borrowing status of the stock.
2: Dividend Risk:
This risk relates to the first one discussed, as it’s just another way you risk early assignment. If a company is announcing a dividend, there will be something known as an “ex-div” date, which means that all shareholders as of that date are entitled to receive the divident, which will be distributed usually at a later date. Because of this, call buyers may exercise an out of the money call option in an effort to acquire those shares.
Remembering that exercising an option means that you sacrifice all remaining extrinsic value, another reason a buyer may exercise a call option before an ex-dividend date is that the value of the dividend announced is greater than the extrinsic value remaining in the option. Say a 100c is trading at $2 and the underlying (stock) is currently at 101. The extrinsic value is the value of the option in excess of what it would be worth upon expiration. So the extrinsic value in this situation is $1, since the 100c trading for $2 is just $1 in excess of the current strike price. If the company in question here announced a $2 dividend, an option buyer would likely exercise their call option because the $2 dividend is greater than the $1 of extrinsic value.
3: Pin Risk:
We know that if your spread finishes out of the money it’s a max gain and if both legs of your spread finish in the money it’s a max loss. But what happens when the price of a stock finishes between the two legs of your spread? Let’s take a look.
So using a 100/110c spread as an example, let’s say that the stock finishes at 105. Your long leg, which is there to protect you, is worthless so you wouldn’t exercise it. However the short leg at 100 that you sold will be exercised by the buyer since it’s ITM. As a result, you’re now short 100 shares at a price of 100 and you’ll be holding that position over the weekend. This can go both ways from here, but since we’re focused on risk let’s say that this stock you’re now short shoots up over the weekend and some sort of news/event brings it up to $120.
With this short position of 100 shares at $100 you’re borrowing $10,000 worth of stock. Now that the stock is worth $120 this position is now worth $12,000. Over the weekend you’ve sustained a $2,000 loss. If we received a credit of $3 when we opened this spread, we may have thought that our max loss was 10-3=$7*100=$700. Since we failed to close the spread out, this position has now resulted in a $2,000 loss net of the $300 credit that you received when you opened the position. So on a trade where you thought you could lose at most $700, you’re now down almost $2k.
I can’t repeat it enough, but THIS IS WHY WE CLOSE OUT SPREADS BEFORE EXPIRATION. That is the single most important takeaway I can give you here. Spreads are great since they’re defined risk and defined gain. When you’re buying options you have a defined loss but a potentially infinite gain. This can make it really easy to get greedy and I’ve seen countless traders lose big profits because they keep holding out for more. When you have a defined gain and defined loss it makes it easier to make smart decisions, take profits, and continuously build on those profits over time.
That was an enormous wall of text but I hope it helps explain, from a base level, what spreads are and how they work. Switching from buying options to selling options has dramatically changed my performance in the market so I hope sharing this can do the same for someone else. If you have any questions let me know and I’d be happy to answer them.
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