Earlier quoted context omitted.
It's true that the lending amount of a bank is heavily constrained by regulatory requirements. But that doesn't mean that banks are not lending your deposited money to someone else. Consider two banks in the same country, so having to comply with the same reserve requirements. The reserve requirements are defined as a percentage of the amount on the banks's deposit account at the central bank. So the bank which can t…
And what, would you say, is the current legally mandated "reserve requirement" in the US?
The Crash of ’87, from the Wall Street Players Who Lived It
161–164 of 164 posts
Re: The Crash of ’87, from the Wall Street Players Who Lived It
#162Earlier quoted context omitted.
Buying naked puts. It is like shorting but very leveraged and must be timed.
I wonder if you turn writing naked puts into something like value investing? Figure out from fundamental what you think is a decent value for the stocks in question, then write puts for that strike price.
I do something like what you are saying but with selling covered calls while I am long a stock. A quick search online will show you strategies like this. It is not uncommon for more active equity traders.
I mostly play long cycles in the equity market instead of trading. When I do trade equities, I play one or two stocks that I know their behavior intimately. My very active trading is mostly in futures and currencies.
Re: The Crash of ’87, from the Wall Street Players Who Lived It
#163Earlier quoted context omitted.
I wonder if you turn writing naked puts into something like value investing? Figure out from fundamental what you think is a decent value for the stocks in question, then write puts for that strike price.
I do something like what you are saying but with selling covered calls while I am long a stock. A quick search online will show you strategies like this. It is not uncommon for more active equity traders. I mostly play long cycles in the equity market instead of trading. When I do trade equities, I play one or two stocks that I know their behavior intimately. My very active trading is mostly in futures and currencies…
Yeah, thanks to put call parity a covered call and a naked put are basically the same thing. (I wonder if it's in some more general sense similar-ish to lending out your long equity to short sellers?)
Having said all that, I'm an indexer at heart, and working for Bloomberg I'm not even allowed to trade the more interesting stuff.
Re: The Crash of ’87, from the Wall Street Players Who Lived It
#164My fake portfolio as a kid was heavily IBM weighted. I think it was 120 or 126/share before the crash. This is one of the reasons I got a degree in finance (and economics). I wanted to know what to do with my money if I ever had any.
Did your degree help you with that decision?
Certainly. I've self funded several startups and worked a broad array of positions in my career.
I tend to work a year for somewhere then work a year or so for myself. Get bored with that then go get a job. Rinse/Repeat.
The craziest thing is now I have dual incomes (well dual earners) with my wife finally finishing grad school. So much spare money (DINK).