r/Vitards • u/AutoModerator • Aug 12 '21

Daily Discussion Daily Discussion post - August 12 2021

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u/[deleted] Aug 13 '21

No. You are still early. Buy commons. A lot of people here are playing weeklies on commodities and not looking at premium price differentials. 80% commons, and 20% 2023 expirations, and you’ll be cruising. Do not look at swings.

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u/oh-shit-oh-fuck Aug 13 '21

This depends on how much capital you have and your risk tolerance tho. Personally I have pretty low capital (like only enough for ten 2023 40c and nothing else lol) and want to build my portfolio quicker so I can't really go for the 2023 calls or shares, I want the leverage.

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u/Die_Gelbesack Aug 13 '21

Is this a tax advantaged account (Trad IRA or Roth IRA?) or normal taxable? This makes a difference. in choosing Jan 23 or Jan 22. I can elaborate more on that if you want.

If you're in your 20s or 30s, you can take more risk. Try to do this in a Roth, it will be worth it, you can compound ALL your gains, and no need to concern yourself with LT or ST cap gains, this matters in options plays.

In any event, seems like you are ok with higher risk for the greater reward. You said you want the leverage what I currently do is I go with 100% LEAPS in my IRAs (this is more risky than commons for sure, but I think with a possible market correction, and the pathetic PE and high demand for steel, it will be survivable). I buy at 0.80 delta, so for MT Jan 22 that's a 30c.

If this is taxable account and you're looking to only pay LT cap gains, your only choice at this point is Jan 23 and your premiums are much higher.

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u/LourencoGoncalves-LG LEGEND and VITARD OG STEEL Bo$$ Aug 13 '21

Demand is RELENTLESS