Sonos
My Current Position:
The current bar shows my position currently with Sonos, and what seemed great at the time, is quite a precarious situation currently.
Originally, I shorted 4 PUTs far below market value and did well months before the war in Europe even kicked off. The stock price just barely touched down into my strikes, and while I could have closed the trade for peanuts, I was happy at the time to take assignment for 400 shares.
That was then, and this is now. Very interesting how an economy can crush a rising blue-chip. Let’s look at the numbers of what that bar means from left to right:
I still am bullish on Sonos’ future here, especially after working for Sonos many years ago in the past. I also worked for Apple and have seen Sonos grow and follow into Apple’s footsteps.
That said, I’ve decided the best course for me is to drop my average cost-basis down of the stock from ~19 to as close as that ~15.50 as possible.
With a total position size of 400, I plan on purchasing 6 more round-lots to bring the total to 1,000 shares. Then, I may play the wait & see approach.
Heres the thing, Sonos has had horrible earnings in their last report, and you can see the downward trend for a while now. At the moment they are no longer a profitable company, as inflation is just crushing the middle and lower classes right now.
If I’m going to make a move, now that there is a noticeable drop seems to be a good place to get in. Sure, there may be quite some distance yet for Sonos to drop in price, in fact I even would bet on it, but I can not be 100% sure. I may just short 6 puts from here and wait… possibly on purpose to get assigned. That is an option (no pun intended).
The other step of this trade, is to fund the purchase of 600 more shares. Let’s assume that share price will be around $15 for Sonos. I’ll need $9,000 to pull the trigger.
Originally I thought on shorting PUTs on Coinbase, as the thing is so volatile that even super short strikes into single-digit territory will bring in massive premiums. Of course, you have to go out into LEAPs mode. The problem, is I don’t know if COIN will even be around that long the way they just lose, lose, and lose money. They are a kind of copy of HOOD… the only one purchasing them are dumb-retailers and Cathie Wood.
A better bet, now that I think of it, may be to short PUTs on MicroStrategy. I don’t like the fact that it has already risen so much in value, but after going through the last earnings call, MSTR has done quite a bit of changes to eliminate any possibility of margin-calls, and also did further strengthening of their fortress.
I may short PUTs out to the end of 2025, which will far surpass the next bit-coin halving. This SHOULD be a very bullish event, and I may just possibly close out the options sometime there-after to free up some more margin/risk.
MSTR Chain:
Summary:
So that’s it in a nutshell. Get 9K in premium from MSTR, and push it into Sonos. I’ll probably set the strike of my LEAPs around the $200 level, and plan to pull in over 90 premium if all goes to plan.
If the MSTR part of the plan blows up in my face, well, at least I will only have to purchase at $200 a share, and will have gained almost half that in premium, so it may not be that bad… (knock on wood)
If SONO continues to drop far under 15, I may do another double/triple down plan to reduce my adjusted cost basis even more.
Of course, I’m open to any reasoning as to why this is a totally stupid plan…
My Current Position:
Originally, I shorted 4 PUTs far below market value and did well months before the war in Europe even kicked off. The stock price just barely touched down into my strikes, and while I could have closed the trade for peanuts, I was happy at the time to take assignment for 400 shares.
That was then, and this is now. Very interesting how an economy can crush a rising blue-chip. Let’s look at the numbers of what that bar means from left to right:
- -5,359 (Unrealized P&L)
- -220 (Daily P&L)
- SONO (Ticker)
- 400 (Total # of Shares)
- 6,236 (Market Value)
- 28.98 (Average Price)
- 15.59 (Last Price Traded)
- -0.55 (Change)
I still am bullish on Sonos’ future here, especially after working for Sonos many years ago in the past. I also worked for Apple and have seen Sonos grow and follow into Apple’s footsteps.
That said, I’ve decided the best course for me is to drop my average cost-basis down of the stock from ~19 to as close as that ~15.50 as possible.
With a total position size of 400, I plan on purchasing 6 more round-lots to bring the total to 1,000 shares. Then, I may play the wait & see approach.
Heres the thing, Sonos has had horrible earnings in their last report, and you can see the downward trend for a while now. At the moment they are no longer a profitable company, as inflation is just crushing the middle and lower classes right now.
If I’m going to make a move, now that there is a noticeable drop seems to be a good place to get in. Sure, there may be quite some distance yet for Sonos to drop in price, in fact I even would bet on it, but I can not be 100% sure. I may just short 6 puts from here and wait… possibly on purpose to get assigned. That is an option (no pun intended).
The other step of this trade, is to fund the purchase of 600 more shares. Let’s assume that share price will be around $15 for Sonos. I’ll need $9,000 to pull the trigger.
Originally I thought on shorting PUTs on Coinbase, as the thing is so volatile that even super short strikes into single-digit territory will bring in massive premiums. Of course, you have to go out into LEAPs mode. The problem, is I don’t know if COIN will even be around that long the way they just lose, lose, and lose money. They are a kind of copy of HOOD… the only one purchasing them are dumb-retailers and Cathie Wood.
A better bet, now that I think of it, may be to short PUTs on MicroStrategy. I don’t like the fact that it has already risen so much in value, but after going through the last earnings call, MSTR has done quite a bit of changes to eliminate any possibility of margin-calls, and also did further strengthening of their fortress.
I may short PUTs out to the end of 2025, which will far surpass the next bit-coin halving. This SHOULD be a very bullish event, and I may just possibly close out the options sometime there-after to free up some more margin/risk.
MSTR Chain:
Summary:
So that’s it in a nutshell. Get 9K in premium from MSTR, and push it into Sonos. I’ll probably set the strike of my LEAPs around the $200 level, and plan to pull in over 90 premium if all goes to plan.
If the MSTR part of the plan blows up in my face, well, at least I will only have to purchase at $200 a share, and will have gained almost half that in premium, so it may not be that bad… (knock on wood)
If SONO continues to drop far under 15, I may do another double/triple down plan to reduce my adjusted cost basis even more.
Of course, I’m open to any reasoning as to why this is a totally stupid plan…
