Global Macro Trading Journal

Kindle Fire looking like a disaster. Even Walt Mossberg, who I assume is in the back pocket of most of these tech companies, doesn't sound so hot on it. Will look into buying puts on AMZN.
 
Sold the Jan 2012 $70 BRKB put option. This is a strategy I had forgotten about and wasn't using much. I need to short puts in stocks that are slightly overvalued(Not BRKB case, this is just a case where I already have a big position and will only add more on declines) but that are pretty safe when the VIX is high AND do it in a conservative size

Running a significant part of one's portfolio like this is a recipe to disaster but in small amounts it can add a nice little income which compounded over many years should boost my returns a bit
 
Quote from Daal:

Sold the Jan 2012 $70 BRKB put option. This is a strategy I had forgotten about and wasn't using much. I need to short puts in stocks that are slightly overvalued(Not BRKB case, this is just a case where I already have a big position and will only add more on declines) but that are pretty safe when the VIX is high AND do it in a conservative size

Running a significant part of one's portfolio like this is a recipe to disaster but in small amounts it can add a nice little income which compounded over many years should boost my returns a bit
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Don't forget that this makes you less able to purchase very cheap stocks after major market declines. If you are short a $70 put, that's 100 shares you can't now buy if the stock falls to $50 in a crash. The opportunity cost of one missed $20 discount is probably far greater than the premium you will collect during the average market cycle.

For example, imagine how much more Buffett could have bought in late 2008 and early 2009 if he was not short a giant put on the indices.
 
Quote from ralph00:

Kyle Bass - Germany in trouble too. 81% debt/gdp ratio and they still have to recapitalize their banks. No chance they're going to take on debts of southern Europe. Eurobonds aren't happening. Either the ECB let's the euro go or the contagion continues.

http://news.bbc.co.uk/2/hi/programmes/hardtalk/9639507.stm
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Could we have a 20-30 handle down month in the EUR at some point? If the ECB caves, there is no reason to touch the Euro with a bargepole until it gets seriously cheap on a PPP basis. And that's a long way down from here.
 
Quote from Ghost of Cutten:

Don't forget that this makes you less able to purchase very cheap stocks after major market declines. If you are short a $70 put, that's 100 shares you can't now buy if the stock falls to $50 in a crash. The opportunity cost of one missed $20 discount is probably far greater than the premium you will collect during the average market cycle.

For example, imagine how much more Buffett could have bought in late 2008 and early 2009 if he was not short a giant put on the indices.
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That's true which is why I'm sizing this conservatively. I already hold tons of 'cash'(In the form of BZF, gold, silver and forex account collateral)

I do think the BRKB situation is a bit different since Buffett already said he is going all-in if the price drops bellow 10% above book
 
Quote from Ghost of Cutten:
Could we have a 20-30 handle down month in the EUR at some point? If the ECB caves, there is no reason to touch the Euro with a bargepole until it gets seriously cheap on a PPP basis. And that's a long way down from here.
More...
There's one good reason to touch the Euro, even here... It's called the long hand of Beijing.
 
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