Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (152276)	1/3/2020 4:52:25 PM
From: TobagoJack	1 Recommendation Recommended By dvdw© Read Replies (1) \| Respond to of 217593

Re <<Hang tight>> Besides hanging tight, had this night shorted Puts to wager for / with NEM, GOLD, and WMP, and ... as found the GLD Puts to be too ‘cheap’, so bought GLD Puts (strike 140 & 141) to wager against GLD, covering about all the value exposure of the underlying gold mining shares in my basket, assuming all of the gold shares (NEM, GOLD, WMP, KL, FNV, RGLD) are put to me 21st February. I like sleeping. The above positions in aggregate, that being OTOH short gold miner Puts / long miner shares, and OTOH long GLD / SLV Puts, are about equal in value, with the hope that i am hedging out the dangers of the underlying metals prices from the mining / exploration (extracting metal in dirt) equation, and the macro optionality of mining reserve in dirt holding function. IOW, the Puts on the metals are just too cheap - and demands to be bought if one not willing to sell them. For example, GLD Put February 21 strike 140 (current price of GLD at 145.89, so 4% away) finance.yahoo.com costs 0.34 per share; seems cheap for protection when all expect GLD to rise for any number of good reasons. If the last $30 of gold price was due to fear of war (i do not fear that) as opposed to terror by ZIRP/NIRP macro, then gold should drop back 30 in a few days / weeks and can collect a gain on the hedge; Should gold fail to fall back by 4% (November / December levels), not much harm done, as the value on table claimed would be larger than loss on GLD / SLV puts. Sleep is good if good. Unclear to me that any of the zig / zag / to / fro actions qualify as investing. All resemble casino play, or just computer gaming.

To: carranza2 who wrote (152276)	1/3/2020 8:19:08 PM
From: TobagoJack	Respond to of 217593

re Message 32486602 the hedge, (1) just tallied, to check that I was not thinking wrong during early / pre-dawn morning machinations: (1-i) have exposure to gold / silver mining shares / ETFs via shorted puts, notional value of X (assume all shares put to me), and w/ actual value @ 3.77% of X (what shows on the books at end of each trading period), all expiring 21st February (1-ii) have additional ~0.2X in gold / silver mining shares held, value at risk @ 0.2X (1-iii) therefore total at risk @ 1.2X on the long side (wagering for gold / silver) (1-iv) have long Puts on gold and silver metals, notional value ~1.1X, actual cost 0.46% of notional value, or 0.005X So, supposedly, it seems that at cost of total 0.005X am protecting the entire basket (1.2X) against a decline of gold / silver of greater than 4%. (2) As the miners did not actually react much positively (if at all) from the latest $30 rise of gold caused by the ME situation, might not react negatively as gold metal floats back down (3) The market does not seem to believe gold can float backdown by 4% (145.89 top 141 / 140) before 21st February. Any correction can / should easily be able to cause a hubbub mattering to the GLD puts, I believe. Market too complacent. (3-i) on this round am happy to learn by Mr Market's teachings, and besides, I think have opportunity to trade out of the hedge position between now and expiration at breakeven or profit even as the main position wastes away via time decay which I would be okay to wait because I can sleep better. This year Chinese Lunar New Year is in late January, reinforcing my belief that gold can easily float down by >4%. (3-ii) oil is too convoluted to read, what w/ all the jiggles between Iran, Saudi Arabia, Russia, USA, China, Japan, Europe, and Israel, whether due to output, demand or just things go boom or kaboom.

To: carranza2 who wrote (152276)	4/19/2020 12:46:09 AM
From: TobagoJack	Respond to of 217593

RE <<Suleimani’s demise will rock all markets, oil and gold especially. Hang tight!>> It turns out suleimani was a sideshow, but we were right about being rocked, and about gold, however wrong about oil. as events worked, oil went down a lot, and doubtful either of us was high on oil, as liquid oil is just not as robust as solid gold; and gold went up quite a bit, and we had enough at that time, even if we would have liked to have more.