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McGonicle

McGonicle
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  • Going Over Walter Energy [View article]
    washing stock in multiple accounts like that creates a nightmare accounting scenario--never do it.
    Apr 21 12:47 PM | Likes Like |Link to Comment
  • Playing Leapfrog With Molycorp [View article]
    its a strategy that relies on price stability no? I apologize for the colloquial use of the word "collar", which is a term of art.

    The put premium (and call) is massive for most stocks that i follow.

    An ITM put costs typicaly hundreds of dollars per contract (for a 40-100$ stock) which i have observed can evaporate and be worth a few dollars a contract if the underlying stock moves 7-15%.
    Apr 9 01:12 PM | Likes Like |Link to Comment
  • Playing Leapfrog With Molycorp [View article]
    Unless your counterparty, the options writer, is the one taking the premium, not you. Try collaring TSLA at $20--in this market it will rise %1200 percent on you.

    "In fact, being rangebound is by far the most desirable of all conditions and is extremely rewarding."

    Yes it is. However, considering the current market, rangebound behavior is mostly a dumb money trick--weak stocks are propped up, great stocks have risen %300-%2000. Sector rotation means no particular type of stock will remain rangebound for long--GILD was $40 for 3 years, then it doubled. On nothing. The entire biotech sector just doubled. On nothing more than it was the laggard and big money has run out of play.

    You cannot short or collar that. Dying, horribly diseased companies like ACTV were bought 500% above their low. HLF has moved from 30 to 80 on one traders attack. I can provide example from every sector--within the last 5 years, almost every stock on the market has shown implied volatility from the mean that is about 5 times greater than the market has shown in 30 years.

    The market 2009-2014 has proven again and again that shorting and collaring any stock is tremendously foolish, as they can literally rise 1000% with no earnings, prospects, news or catalysts other than market making and trade. This is a zombie market. Try to collar a zombie.
    Apr 9 12:31 PM | 1 Like Like |Link to Comment
  • Playing Leapfrog With Molycorp [View article]
    You are providing a sterotypical example; your profits (when they exist) can be taxed by the fee, but your losses are also increased by the cost.

    As I stated, your cost is much higher than mine; for 100 contracts, you pay $108. For 1, you pay $9.

    Unless I take you to mean that you only call winning positions, always make money, and have a >SNP return at all times and in all positions.
    Apr 9 11:55 AM | Likes Like |Link to Comment
  • Playing Leapfrog With Molycorp [View article]
    It seems unwise to attempt to collar a stock that shows that kind of volatility. MCP has been stable over months, but that is because it had its "three bounces" last year, and now it is locked in a capex/weak pricing death spiral.

    Its my observation that gold stocks occasionally do this (IVN, TSE, KGC, AGI), they just totally collapse to a new, lower level, and stay there, pricing (sometimes for years) within a new range. That is collarable, but its not a reason to want to have the stock put to you.

    If MCP could literally rise $1-$2 in a single session (though now very unlikely as all catalysts and enthousiasm for the stock are gone/known), or it could declare functional bankrupcy and a liquidity crisis and drop to $2 overnight.

    Attempting to collar that "weak" $4-$5 price range in MCP is picking up nickels in front of a steamroller.

    Further, I pay $50 plus fees for each leg of my options trades. You may pay much less, some say as little as $20, but unless you are allocating say $50K-$100K to one stock position (including options and common/prefered shares), these small fees will eat your nickels alive. The trade you show appears two-legged (requiring 4 trades in/out per strike), some more complicated straddles are four legged (8 trades in/out). If you are rolling a weekly option your chart shows 17 separate positions, which would require 58 trades in 2 months, nearly 1000-2500 dollars (for trades, not including fees) is spent in costs just position keeping.

    Considering these factors, I maintain that those with less than the mid-hundreds of thousands of dollars to trade with should never use these types of strategies because they are

    1) enormously dangerous
    2) extremely expensive to maintain and roll
    3) not very rewarding even when your stock is rangebound
    4) less effective than calling a direction and buying common stock.

    Thank you.
    Apr 9 11:27 AM | 12 Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    Musky doesnt sell cars, he sells dreams. In this way, he is like every other American huckster--he is a historical genius if he gets the product to market (going bankrupt later may not matter much, especially if you die before that comes to pass), on the other hand, he's PT Barnum for the QE era of cheap, dumb money if he fails.


    You have to give him credit--like zuckerbutt, he would basically admit that he stole a stupid idea from someone else to create an uninteresting app he wouldnt bother to use, and then he sold it for $300 billion dollars from someone with more money than ideas.

    I think you have to accept that the game today is about ideas and pretenses bigger than ever before, but that what came before in history (like all the inept analogies in these comments to about 30 different technologies and personalities)was not substantial, reliabile, well though out, planned, or anything else but sometimes just dumb lucky enough to run into big, dumb money.


    When you have an unlimited budget of OPM, anything IS possible. We went to the moon on that and the USGOVT convinced you you were stupid not to spend your perpetual taxes on a sweet, permanent moonbase as well. Idiots.
    Apr 8 03:24 PM | 1 Like Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    when he loses half, he has to sell the other half to cover the leveraged losses against the whole, which is what brings billionaires to bankruptcy.
    Apr 8 03:08 PM | 2 Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    jack;

    Laughable. The people who make real money and fight real wars, to win--they take almost no risk, they make others take the biggest risks, and wait for them to fail. All glory to the victor, as he will need to put his whole bloody sandal on your back to claim his victory.
    Apr 8 03:06 PM | 2 Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    Into the factory go dreams, unicorns, rainbows and clouds, and out the other end comes a half a million gleaming, polutionless, roadworthy steeds.

    It only takes one graphic to show this, you luddite philistine. People like you probably want to see the part where the unicorns put their horns through the rainbows and the car appears, but that would be giving up a trade secret.
    Apr 8 03:02 PM | 6 Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    he just sold the market 80 million shares of junk in return for their OPM--today, rubes and dumb big money are the main source of financing, not profits or products
    Apr 8 02:59 PM | 4 Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    Who would swap their good, new multi thousand dollar battery with a dead, eaten up one that wont take or hold a charge? The main thing that powers Tesla cars is extreme expectations, not batteries.
    Apr 8 02:58 PM | 4 Likes Like |Link to Comment
  • Vale: The Company Is A Good Buy At Its Current Depressed Price [View article]
    a variable dividend taxed by the government that is sometimes paid and is sometimes not and can be anywhere from a nickle to sixty cents...

    is a crappy yield in any event.
    Apr 3 10:02 AM | Likes Like |Link to Comment
  • Peabody Energy Looks For A Better Mix To Drive A Better Outcome [View article]
    WSS- agree. Its the old salt, "


    1) At some point many companies in the sector will go bankrupt


    2) but not while I'm holding them.
    Apr 2 04:00 PM | Likes Like |Link to Comment
  • Peabody Energy Looks For A Better Mix To Drive A Better Outcome [View article]
    Tossed ANR today for a .20 loss. Two weeks of dead money with a $4 PT violates my "time" and "prospect" parameters for the trade.


    I feel the recovery will peak near $5.4 (http://bit.ly/KN1Y08), within a few months.


    However, ANR has now eff. comitted 200MM of its 600MM in cash for the settlement, which means another debt dip coming. Summer is not a catalytic time for thermal (which is marginal loss on production). Met was the life saver, and it isnt happening.


    *Predict Debt Dip ~1.5 Billion ANR 2015 Senior around Q3-Q4 2014 with a 2018-2020 maturity @ 8%*


    That fact is going to keep a lid on our potential rise, as the big boys wont bounce when they feel the debt dip is comn.

    I should add that between PCX and JRCC, PCX was always 50% higher in price, but it died first. Price can be very deceptive (ACI vs ANR) as ANR appeared APPEARED healthier than ACI but the statement that the Massey Acq was a rip off has now squelched the difference.

    Also, this was 3d bounce. Dont trade 4th bounces--they dont happen.
    Apr 2 03:55 PM | Likes Like |Link to Comment
  • The Stock Market Is Rigged! The Stock Market Is Not Rigged! [View article]
    The government just guaranteed 99 Trillion dollars worth of exponential risk, juiced the market, trippled it, made a million new millionaires, most of them small fish like us. Some issues like PCYC are up 60x, some standard stuff is 20x its bottom.


    You just got handed a %3,000 return for keeping the faith, and you want to bicker about %.0001 moves?


    The man behind the curtain is way, way more important than the guy watching to see when he puts his trash out at the curb.
    Apr 2 03:49 PM | Likes Like |Link to Comment
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