/biz/ - Business & Finance

>post frog
>be retard

can someone explain the difference between longing/shorting and puts/calls?

>>57539670
a put/call is an option to buy or sell. you don't have to exercise your option if it's unfavorable (in which case you still lose the money you spent on the option). you have to buy the option from someone willing to offer the options contract. that person loses money if they sell you an option that ends up favoring you and you exercise it, they gain money if your option expires worthless

This is why i never short anything. from a retail perspective it is just not worth it. its kind of retarded to be honest too with the skewed risk profile.

Don't get me wrong. i SELL things, and buy back lower. i just dont borrow on leverage to sell more(short). it really makes no sense longer term. if you fuck up you can get infinitely screwed. if you "win" the underlying asset is worth a lot less anyway.

I only use leverage to go long, and never more than 3x leverage. that is plenty. if you exit your position early, and it keeps going up, you still benefit, unlike a short where your position loses value if you exit too early.
selling the asset instead of shorting serves as a means of taking profit too, which shorting definitely does not.

>>57539685
ty fren

The most a stock can go down is 100%. The most a stock can go up is ∞ %

>>57539670
if you can't understand it by reading then just put some money on robinhood and enable options trading and fuck around with calls and puts. it all makes sense once you see the money going up and down. just don't lose too much

>>57539670
the price of the call goes up when the price of the asset goes up. if you hold the call you are long that call. if you then sell that call that you own, you're back to having no position. but if you then sell another call, that you don't own, you're short a call (don't do that)

>>57539622
>your maximum earnings will be the maximum amount you put to risk on that trade
what do you think leverage means, anon? also, an asset can lose 10% of its value a thousand times. you have to think in percentages.

>>57539749
It's not about the leverage but at $0 you repay back now worthless assets you borrowed and you profit off of how much those assets were initially worth when you first borrowed them

>>57539692
I mean I guess it makes sense why you want to short something with the smallest amount of leverage possible, if you think it can go to $0 then not having those big leverage trades for those small percentage wins isn't something you're going for

>>57540147
I don’t think you get it at all. gn anon.

>>57540192
Do you want me to explain how with more leverage you earn a higher % for each move up or down in a direction?

>>57540153
Its not that. It is just about risk exposure.
There is a fundamental problem where shorting just over exposes the average person to risk. There should not be “money to be made” shorting for average people.
The markets generally trend up long term. Find good things you are bullish on, buy them and go long with them when opportunity presents. Take profits if you think it is over heated or target reached, and if the asset falls in price you can buy more if you feel it will continue to go up longer term and opportunity shows again.

Your risk as the average person is only to the down side, and it is somewhat mitigated by the natural profit taking built in to only selling rather than shorting.

Now add actually shorting to the average person strategy and their risk is exponentially up. They both have upside risk now and downside risk, except no natural balance as described above on risk, as instead of selling and realising profit after a long, they short and expose themselves to LOSS NOT REALISING GAINS if the trade goes badly.

Meanwhile the retail investor who only longs, even if after selling the asset rises they still gain if holding or are simply up on their investment locked in realised gains if they sold rather than shorted.

Its just way, way easier for most people to be successful that way imo.

Leave shorting to highly sophisticated hedge positions by banks and such using other people’s money secured by tax bailouts if they fuck up.

>>57539743
so if you can short a call can you long a put?

>>57539622
Shorting is worth, you just need the correct place and time frame to short.
So its a hard process of dyoring and luck, but data analysis tools like idk truflation or patterns analisis like databricks could give you good hints.
Information is the key

>>57540326
Yes.
Now look up long and short iron condors.

>>57540313
What if I say shorting is the more jewish thing you can do because basically you bet most people fail on their dreams and start crappy businesses so you just short them, because I think it's more true that 90% of all assets will die or were just a fad. So your risk isn't that bad because if the fact is more how most businesses fail then you you make up for less gains in shorting by having more assets available to short

>>57540340
Shorting should only ever be a short term strategy. Anyone long term shorting is either a whale who can manipulate the price down and secure the win, or is retarded.

Last cycle I shorted at 55k thinking the bull cycle was over. then it went to 30k then back to 60k

>>57539622
I'm not a fan of shorting. I prefer holding. And hunting for airdrops.Currently involved in DOP and DUA airdrops after finishing DYM.

>>57540366
I'm sure your nighbours artisan pizza place is famous on a stock market and available for shorting