I buy FDs, always loose money on them and I’m proud via /r/wallstreetbets #stocks #wallstreetbets #investing


I buy FDs, always loose money on them and I’m proud

I used to think buying weekly’s is complete shit, that only the most stupid retarded WSBers would bother to buy them.

But now I realize that they do hold their place. Since weekly’s have such high gamma, they can be a great hedge against your long beta-delta(correlated long to the Index) Portfolio. They’re also cheap and the returns on them are not linear because of gamma and delta. FYI if Options are close to exp they become more sensitive and therefore the return isn’t linear at all.

With weekly’s usually if you loose( with you will often times) you loose a small amount of the premium collected / your capital. And if you win, you significantly reduced your losses. It’s basically trading a lil of your premium for some downside protection. I recommend weekly’s on TQQQ if your really broke, they do have decent volume and aren’t as expensive.

And lastly don’t overallocate to weekly’s I’ve found about 1-3% of my portfolio to be fine. Also adjust this to meet with your personal risk tolerance and prediction of future volatility. Also adjust this to meet with your directional exposure ( buy OTM FD calls if you are short the market)

My message here is : stop thinking about weekly’s as a weapon for gamblers, start using them effectively and they will be a great tool for you.

Submitted March 17, 2022 at 10:06PM by musiro77
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