Here’s another analysis from Josh Marshall at Talking Points Memo.
https://talkingpointsmemo.com/edblog/understanding-papa-dons-new-pump-and-dump-8-k#more-1484880
Do you have to find someone willing to buy it at that price, or is that going to be the party on the other end of that contract?
No – options are fungible, like stock. Anyone who’s sold those puts is obligated to buy the stock at that price when the options are exercised. It hits their account automatically.
So if the stock is $25 on expiration day, your put option gets exercised automatically. You buy the stock at $25 on the open market and your brokerage sells it at $40.
My impression from the days when I was playing around with put and call options was that they’re only offered for a limited selection of major stocks. It may not be possible to buy puts in DJT just because there aren’t any.
Another problem with puts and calls is that their price is directly proportional to the remaining time to exercise them – the farther out the expiry date, the more expensive they are and therefore the more the stock has to move in your preferred direction in order to make money. IOW, when betting on puts and calls, you not only have to know what the underlying stock is going to do, you have to be pretty confident about when it’s going to do it. If you’re right about the stock trend but wrong about the timing, you lose. The pricing of puts and calls makes them a lot like casino gambling – the odds favour the house.
Yet another issue IIRC is that, dollar for dollar, commissions on puts and calls are much higher than on stocks.
Completely untrue! There are hundreds of puts and calls available on DJT alone.
True, but I wouldn’t call this a “problem.” It’s why options are valuable. Generally speaking, option values are tied to time to expiration and the underlying asset’s volatility. DJT is highly volatile. If you want to make a long-term bet (or protect stock you already own), you’re buying certainty about a very uncertain asset – and the longer you want that certainty, the more it’s gonna cost you.
But here’s the thing – you don’t have to hold the option until expiration. If you buy a DJT put and the stock goes down sharply, you can probably sell that put for more than you paid. Whoopee, profit!
True. But you can only lose what you paid for the option (plus commission). If you short the stock and it skyrockets, you can lose a lot more.
Also somewhat true – but every option is tied to 100 shares of stock, so your costs may ultimately not be that much higher.
Thanks for that clarification. Back in the pre-internet days when I sometimes dabbled in day trading including occasional puts and calls, I relied on newspaper listings. There were far fewer puts and calls listed than the complete stock listings for the major exchanges.
Quite true, but if you buy a bunch of puts and calls at random, or on a hunch, which amounts to the same thing, I guarantee that over the long term you will lose. This is the exact opposite of investing in a normal diversified stock portfolio, where over a sufficiently long term the normal upward trend of the market is pretty much guaranteed. IMHO, except for hedging, buying puts and calls is only justified if you have really solid inside information. I would not buy puts in DJT because even though I’m pretty confident it’s going to tank, I have no idea when.
No question! No one should play around with puts and calls unless they have deep pockets and a damn good idea what they’re doing. And even then it’s like sports betting – you have to be right at least 55% of the time to cover your costs.
If you have solid inside information, that’s called “cheating.” 
But I only raised the subject because, with a stock like DJT that’s nearly impossible to borrow, buying puts is the only way most people will ever be able to bet against the stock.
But that doesn’t automatically make it a good idea.
The Arizona GOP is having financial problems, on top of their chairman resigning after being caught offering to bribe Kari Lake.
The party of fiscal responsibility? Say it ain’t so!
I’m sure the RNC will be willing and able to bail them out.
/s
Now imagine if the GOP were run by democrats - now THOSE financial problems would be off-the-charts!!!
I assume you’re being sarcastic, but just in case:
- The DNC, unlike the Trump-controlled RNC, is in splendid financial shape.
- The deficit typically shrinks under Dem presidents and grows under GOP presidents.
Just released!
Thanks for reinforcing my cite-less post!
yep, …
consider a:
/s
added …
also: phrases that 10 years ago would clearly be reckoned as joke need to be doublechecked - same as onion-articles which often get blured by their closeness to reality.
On the other hand, also according to the EPI, economic performance is stronger following a Republican White House.
And preceding one.
You’re welcome.
I actually made the same point about this in my thread here:
And… more readable option… my Substack here:
This is only speculative schadenfreude, but I found it amusing enough to pass along.
The Pod Save America guys were talking about Donald Trump’s potential running mates. Apparently Marco Rubio is currently in the conversation, but with Rubio there would be the constitutional issue involving both candidates on the ticket being from the same state.
So there is a scenario where the deadline for picking a running mate is approaching with Rubio still on the short list, and Trump’s team convinces him to move out of Florida because of 12th Amendment concerns.
And then Trump picks somebody else.
And now this: