A lot of these like 'Write a Book' do not involve actually losing money. They are in fact earning money, just at a lower rate than the author demands.
Not if you value time.
How to Lose Money
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Re: How to Lose Money
#92Earlier quoted context omitted.
It's a 50/50 bet if you pick sides at random. You may have a loss in expectation but it will be because of spreads, transaction costs, taxes, etc. (Only half-joking.)
Well, it can’t be 50-50 bet ever since there’s the time decay. 33 percent is the best bet to win!
I'm not sure how that is relevant. The price of the option will decay to zero or to its intrinsic value and if it ends in the money one side will give $X to the other at the end. Someone also paid a premium to the other (ignoring the bid-ask spread and transaction costs). Peter's gain is Paul's loss. You have 50/50 probability of being Peter or Paul.
Re: How to Lose Money
#93>The nice thing about options is that there isn’t just one way to lose money. No, you can lose money in many different ways – far more than I can write on this page. This is the most important lesson of options. It's never just a coin flip. You have an unimaginably huge number of factors riding against your success. It's not even remotely close to a 50/50 win/lose scenario. There are a million ways to lose, and just…
Earlier last year around May, when the stock market seemed to pick up after the COVID crash, I purchased a number of deep OTM LEAPs (long expiry options; until early this year). They were incredibly cheap. I often had trouble finding a market maker for those. I only chucked about $2000 in, but these options have grossed $15,000 in realised returns and $25,000 in unrealised returns. Options allowed me to make a “bet”…
I think it is rather well known since Taleb's book came out that deep OTM options, including LEAPs tend to be mispriced as there's just not enough data to model better pricing.
Re: How to Lose Money
#94Earlier quoted context omitted.
In the 1980s/90s, a medical degree was the “sure bet” way to a six-figure income. The result was a huge flood of doctors that were... not the best , and some fairly dodgy medical schools. Of course, this also ended up pushing malpractice insurance (and tuition) into six figures, so I guess we achieved balance. We’re starting to see some similar stuff, going on, now, in software development. There’s some... not the be…
This is just not true. Residency slots have not changed much if at all in decades due to the AMA. It wasn’t until the late 00s do we see any meaningful uptick in medical graduates.
OK. I will accept that. Any idea why so many doctors I know (American born and bred) had to attend offshore schools?
Re: How to Lose Money
#95A lot of these like 'Write a Book' do not involve actually losing money. They are in fact earning money, just at a lower rate than the author demands.
Assuming writing tools and research such as computer, books, internet, etc are treated as freely available, you can still lose money if you are paying for professional services such as book cover, editing, etc.
Barring an understanding partner/very good friend who is a good writer who will put maybe a few dozen hours into at least copy editing, you're very easily looking at breakeven at best for many books. (Cover design is arguably less important if you won't be in bookstores.)
If a book is supporting some other activity, it can still absolutely make a lot of sense. It's tough to make a lot of money directly but it probably won't cost you a lot either unless it involves traveling for research etc.
Re: How to Lose Money
#96Earlier quoted context omitted.
> E.g. If I am net long in my portfolio and I fear some headwinds I can buy a put or two for the peace of mind. Now those puts should be always considered as worthless, and it is just the price to pay for the peace of mind. Why don't you just change your allocation? If you can't sleep at night because of your current portfolio, and gyrations that are occurring, or that you are worried could occur, I would say it's ob…
Year ago when we were reading the news about what is happening in Wuhan, some of my friends bought SPY puts as an insurance against the potential crisis. The best outcome for them would be if those puts expired worthless. When you insure your house, you don't usually wish for it to burn down. I haven't acted and my portfolio took a -30% hit right after. Your suggestion (to change the portfolio allocation) would mean…
How does holding money have an "unlimited loss potential"? You just buy back at whatever value the stock is at the time.
I would argue that money is a neutral position (adjusting for inflation which is nowadays quite low). After all, we buy stuff with money, not stock.
Now, selling short, that has an unlimited loss potential, but it's very very different from a cash position.
Re: How to Lose Money
#97Shorting call options also has a nice feature: there is no limit to how much you can lose. But really, what this article misses is a tip about leverage! Whatever your plan to lose money is, make sure you're leveraged. So that you can lose X time the amount you would lose if you only put your own money on the line. Eventually, you'll quickly lose much more than you had in the first place!
This! If you are serious about losing money, use leverage and make sure there is no theoretical limit to your loss. Losing 100% is for beginners.
Re: How to Lose Money
#98Re: How to Lose Money
#99Building an online course[1] has been one of the easiest ways to make money in my personal experience. Other things I've tried building: SaaS, Trades business, Freelancing business. I've made over $8k since I launched last month and it's been a great stepping stone into other ideas. The main problem I see going forward is getting consistent traffic. Building the course was the "easy" part and now I'm focusing hard on…
I have thought about making a course on Udemy or Pluralsight. Did you consider those options before building your own? I am curious because I don’t think I have the skills to create something as nice as you did and also would like to know the pros and cons you discovered.
Re: How to Lose Money
#100Building an online course[1] has been one of the easiest ways to make money in my personal experience. Other things I've tried building: SaaS, Trades business, Freelancing business. I've made over $8k since I launched last month and it's been a great stepping stone into other ideas. The main problem I see going forward is getting consistent traffic. Building the course was the "easy" part and now I'm focusing hard on…
Please correct me if I'm wrong, but you got to the frontpage of HN the first time you posted your site which presumably generated the bulk of that 8k, right?
If you hit the jackpot (I.e. front page of HN) on your first try, yes it's going to feel like it's super easy to make money off building a course.