Hello again folks. This is an extension of my DD last week in which I shared some research on short positions, GME’s debt, and some speculation on institutional investing. Since that post, GME is up 75% and there’s been lots of good bullish / bearish DD on the short term.
In this post, I’m going to cover 3 topics, focusing on the mid-to-long term prospects for GME: 1) Cohen, 2) GME’s market cap potential, and 3) potential investors that could continue to pile in.
TL:DR; You need to think about GME differently. Not as a trader. Not as an investor. You need to think like a venture capitalist. This is an unprecedented opportunity, and the first time I’ve gone all-in - I’m more bullish now than when the stock was trading sub $15. If you’re in GME you need to get in with conviction otherwise you’re going to lose by selling when it drops.

Quick aside - my history and positions:

I’ve been a passive investor for many years. This is literally the first time I’ve taken an interest in becoming an active investor. I opened an RH account in August to start speculating on GME. My first post called out some cheap lottery plays that took my speculating account from $5K - $20K in 3 weeks. I’ve since posted a few times on GME, even trying to tell you to buy the post-earnings dip, and added more to my active trading accounts. I’ve taken $10K -> $130K on RH and $230K -> $480K in IBKR since slowly adding to GME since September.
UPDATE: I have deleted my positions in this post - will explain why in my next post. I'm still holding.
All that being said, thus far I’ve been thinking about GME as a trade - trying to get in at the lowest cost I could for the maximum upside on a near-term exit, but I’ve switched completely into thinking of GME is a ridiculously asymmetric investment with massive potential in the next 2-3 year timeframe - even at $35. Even at $45, $50, $60. That’s why I added roughly 2500 shares on Friday at around $36 despite adding very cautiously when GME was below $20. I’m also completely all-in on RH with options (mostly deep ITM, a few fds) - $0 buying power left.
Grab a drink, sit down. Let me tell you why I’ve gotten more aggressive, and probably why you shouldn’t worry about what price you pay right now, as long as you’re willing to believe and hold.

About Cohen (and friends)

From the recent 8K about the board changes (which you should definitely read if you’re putting serious money in):
As part of the Agreement, RC Ventures has agreed to customary standstill provisions*, which provide that from the date of the Agreement until the earlier of (a) the date that is 30 calendar days prior to the deadline for the submission of director nominations by stockholders for the Company’s* 2022 annual meeting of stockholders and (b) the date that is 120 days prior to the first anniversary of the 2021 Annual Meeting (such period, the “Standstill Period”), RC Ventures will not, among other things: (i) acquire beneficial ownership in, or aggregate economic exposure to, directly or indirectly, more than 19.9% of the Company’s outstanding common stock; (ii) make any proposal for consideration by stockholders at any annual or special meeting of stockholders of the Company; (iii) make any offer or proposal with respect to any extraordinary transactions; or (iv) seek, alone or in concert with others, the appointment, election or removal of any directors in opposition to any recommendation of the Board, in each case as further described in the Agreement. As part of the Agreement, the Company has permitted RC Ventures to acquire, whether in a single transaction or multiple transactions from time to time, additional shares of the Company’s common stock to the extent such acquisitions would result in RC Ventures having beneficial ownership of less than 20.0% of the outstanding shares, without triggering the restrictions that would otherwise be imposed under Section 203 of the Delaware General Corporation Law (the “DGCL”), and RC Ventures has agreed that upon acquiring beneficial ownership 20.0% or more of the outstanding shares of the Company’s common stock, the restrictions under Section 203 of the DGCL would apply to a potential business combination with RC Ventures as an “interested stockholder” (as defined in Section 203 of the DGCL).
This is critical: This agreement was the result of a negotiation between Cohen and the existing board.

After his activist letter calling out the board and then 13D buy after the earnings dip rocketed the stock up from 12 -> 20, it was clear to everyone that RC was the reason GME’s stock was heading up. The GME board was afraid of a hostile takeover / losing their jobs. This agreement allowed Cohen and 2 others on the board as long as he didn’t attempt a hostile takeover.
Cohen wants it all. In the activist letter, he publicly said “no” to just one board seat. He then publicly bought more as soon as Sherman threatened a shelf offering to dilute him below 10%.

In addition to getting added to the board, Cohen brought along 2 execs who built Chewy with him:

Alan Attal - the previous COO and CMO of Chewy (2011 - 2018)
Jim Grube - the previous CFO of Chewy (2015 - 2018)

He’s not fucking around folks. He wants to build another Chewy, and he’s bringing the people who helped him do it the first time to do it again.
As a result of the agreement, he’s limited to buying up to 20% of shares until 2022. Why not 13%? Simple - Cohen wants the option to buy more. He’s not happy with a single board seat; he’s not going to settle for simply getting added to the board; and he’s not going to settle for 13% ownership.
Also, remember that Alan and Jim have 💲 to buy in as well. I haven't seen their holdings yet. Their time is worth more than their money and they've already decided to put their time in.

Cohen is not an exec - he’s a founder with an all-in mentality

Go read this bloomberg Cohen interview to understand his mindset.

Cohen himself is an all-in person. Key quote:
1. “When I find things I have a lot of conviction in, I go all-in*.”*
2. Cohen is a founder that has gone through the successful creation of a startup. When you are startup founder, most of your NW is tied to equity in your company. You are trained to have skin in the game. You’re not allowed to think you have a safety net. You give up years of your life and bet everything because you have to believe in what you’re doing. Founders typically have 30-50% ownership of their company.
3. “Cohen uses the word “conviction” a lot. He says it’s something he learned from his father, who ran a glassware importing business in Montreal where Cohen grew up. “He taught me how to block the noise from the masses,” says Cohen. “To have a point of view and have conviction and not waver.”
He only sold Chewy rather taking it to IPO because of his Dad’s health. He cut his entrepreneurial career short and he’s itching to get back in.
Cohen sold Chewy for $3.35B, with estimates stating he personally walked away with about $600M after taxes.
Cohen has a lot of capital to buy more. After selling Chewy, he went all-in on Apple & WFC, which as of June was up 40%.
1. “ Cohen says his portfolio, when including dividends and a few other stock holdings, has returned more than 40% over the past 3 years, beating the market.”
2. Aapl was his largest holding, and is up another 50% since June 5 when the Bloomberg article was published.
3. Cohen lives in FL - with no income or capital gains for individuals, unlike other founders who live in CA which taxes all cap gains as ordinary income.
4. I’m going to estimate his net worth (minus his GME holdings) is around $800M-$1B.
Cohen’s 9,001,000 (it’s over 9000! 🐲🏐) shares have thus far been purchased at something like an average of $12/share, for a total investment of around $110M.

So Cohen has put in $110M out of his $1B into GME. Does that sound like he’s all-in? Absolutely fucking not. Cohen’s going to buy up to the max he can this year (20%), likely by selling some other holdings prior to cap gains tax law changes. He can add more next year after the standstill period is done.

What will lead to Cohen’s next purchase of GME

Thus far, every RC purchase has been about sending a message.

Prior to Q3 earnings, his purchases were signaling an intent to the board that he was serious about wanting to get involved. He also rubbed it in their faces that the stock price was largely appreciating because of him. From the activist letter:
1. “We recognize that the Board may feel it is insulated from stockholder scrutiny after adding new directors this past spring and seeing a recent stock price uptick (which only came on the heels of RC Ventures filing its 13D)” (what a fucking burn).
If there was any doubt about RC’s impact on the stock price, it was put to rest after Q3’s earnings, where the current leadership’s hubris and threat of diluting RC led to a drop of almost 30%. RC then bought the dip, shoved it in their faces, and the market GME again rocketing GME to 20 in a massive post-earnings recovery. Message sent again - “The market wants me. Let me the fuck in.”
Now that Cohen and the Chewy folks are on the board, he’s going to angle for CEO. He’s not looking to advise GME. He wants to go all-in, to run GME. He’s holding the optionality of buying more based on the success of his attempt to take over GME through non-hostile means.

If you see Cohen buy more GME, he’s sending another message. This time it’s because it’s clear to him he’s going to be CEO and wants to max his skin in the game. If you see Cohen buy, it’s “CEO talks going well” - you fucking buy.

GME’s market cap potential

Cohen sees a $200BN+ total addressable market cap for gaming by 2023. For contrast, Chewy was playing in the pet food/supplies market, which has a total addressable market (TAM) of under $50BN annually. GME’s potential is at base 4x that of Chewy. This does not even account for the pc gaming hardware market, which is another $35BN+.
Chewy’s market cap is $44BN on $6BN of annual revenue.
Chewy’s Q3 quarterly income was up 45% YoY. While GME’s quarterly income was down YoY, its e-commerce revenue was up 257% trouncing Chewy’s growth rate.
GME’s Q4 early sales preview reported 300% E-commerce growth and annual run-rate of $5BN

In other words, even if you give GME’s physical locations no value, GME’s ecommerce business is growing 5x faster than Chewy and already has 75% of online revenue.
Summary: Chewy is priced > 7X times its annual total revenue. GME is priced at .45 its annual ecommerce revenue, despite GME having 5-6 greater TAM and growing its ecommerce business 5X as fast Chewy.
What. The. Fuck.
I’ve never seen a stock more mispriced.
People talking about $100 price targets are suffering from a fucking lack of imagination.
Even if you completely discount

GME’s physical business
its rev sharing partnership with MSFT
its 5x faster growth and 5x TAM

and give GME the same P/S multiple that Chewy has on its ecommerce business, that puts GME currently at a fair market cap above $35BN. That means GME should be at least $500/share.
In pictures:

Comparing Ecommerce Revenue vs Market cap on Chewy vs GME today

Showing what the fair market value Market Cap of GME would be with Chewy's P/S

Fair Market Value (using comps) of GME is at least $500/share.
$35/share is a fucking steal. Who cares about the short-term dips as shorts try to weasel themselves out of their positions. The market will eventually wake up to this sleeping beast. In a year you’re not going to care if you got in at 4, 12, 20, 35, or 50. You’re going to only care if you’re in or not.

Potential Investors

An asset is only worth what someone else is willing to pay for it, right? So are the potential buyers of this growing company?
Here’s a list in decreasing order of likelihood.

Elon (Least likely, completely improbable, but cataclysmic event). Elon hates shorts. Elon, with TSLA, went through the pain that GME is going through. TSLA almost went bankrupt because shorts were pushing the price down so it was difficult to raise the cash they needed to survive. Sound familiar? Elon’s wealth swings more in a day than GME is worth in entirety. Elon could buy all the fucking float of GME with what he makes in 8 hours. One call from fellow entrepreneur and aspiring twitter-meme-god would absolutely wreck the game.
1. If you are short gamestop, you are one meme purchase by the richest man in the world away from a fucking cataclysmic event. "Hey son, I heard you like games. So I bought you gamestop. All of it." 🚀
Buffett (More likely, still improbable). I’m actually amazed that while Buffett & co were lamenting that there are no interesting stocks to invest in and moving to cash, that they absolutely missed the boat on GME while it was at its lows. It’s a complete value play right up his alley (in a business he can understand). My only hypothesis here is that the market cap is too small and he could not make a meaningful investment. Once GME grows to a more respectable market cap ($10b+) I can see Buffett stepping in and making an investment.
Cohen’s connections. (Highly likely if Cohen is CEO). This is the big one. And I mean absolutely nail in the coffin re-pricing of GME for the foreseeable future. Go read this Harvard Business Review piece on Cohen specifically on how Cohen puts importance on raising money and the people that backed him.
1. Look, I’ve started a startup before in the valley (unsuccessfully unfortunately). However, you don’t start a company without making a shit-ton of venture capitalist & angel investor connections. Cohen has stated that when pitching Chewy he was rejected by over 100 investors. I can absolutely-fucking-guarantee you that every single one of them remembers their mistake and would not miss the opportunity to invest in Cohen again. And don’t forget all of the investors who DID invest with Cohen and reaped the benefits with Chewy. While venture capitalists don’t generally make investments in public equities, this is a truly unique situation. Cohen is treating this like a rebirth, a new venture bootstrapped from GME’s bones. If VCs as a firm will not invest, you can bet your ass that those individuals will throw their personal money at Cohen. However this only happens if he’s CEO. As soon as he’s CEO, a single long weekend trip to the valley might mean 100+ investor meetings with the strategic pitch.
  1. My biggest fear here is that VCs/PE band to take the company private at some small multiple (2-3x) and then reap the benefits while Cohen turns the company around only to re-list it to us 5 years down the road at 30X the valuation.
2. Thus far, it’s been us retail retards vs the wall street shorts. HFs shorting this thing have the advantage in both tactics and capital. However, if Silicon Valley money starts pouring money into this the game is over. You cannot believe the amount of money that gets thrown into startups with 90% of it burning up into thin air. $3B market cap? That’s nothing. Folks with Silicon Valley money & risk tolerance would have no problem betting on a serial entrepreneur making something amazing out of a company that already has a customer base, revenue, distribution - all in the same business (e-commerce) the entrepreneur already proved themselves in.
You, and every other retard that believes. Look, this was my point at the beginning. You need to think like a VC here. VCs are the ultimate YOLO autists making million dollar bets and not seeing a penny of it for years. They are the ultimate 💎✋🤚. You need to decide if you have conviction for the long term and then buy in. 💎✋🤚 doesn’t mean selling at $100. It doesn’t means selling at $200. It means not selling at all this year no matter the price, and at least until you learn for sure whether Cohen is the new CEO. It means believing so hard that you 20-100X your investment in 2 years when the market wakes up to the ridiculous mispricing.
1. Remember that if Cohen is elected CEO he can (and likely will) buy more than a 20% stake in 2022.
2. Remember Buffett’s actual quote: "The stock market is a device for transferring money from the impatient to the patient."

I’ve put every dollar I can into shares in IBKR, minus some April calls. I hold no covered calls except for some call spreads I had in RH prior to recent bump. I have April calls because I will put more cash into GME after taxes are done, and I know much cash I have to use. Calls let me cap the price I would have to pay now.
This is personal research. Do your own DD.
A wiser investor than me gave the advice of “Don’t aim to maximise profit, minimize regret.” If you’re not in GME yet, ask yourself how you would truly feel if what everyone here is saying panned out to be true, and you weren’t participating.
Oh, and of course: 🚀🚀🚀🚀🚀🚀🚀🚀🚀🚀
Update 1: I'm still holding today, but I realized I made a pretty big mistake on the ecommerce revenue analysis. GME's 2019 e-commerce revenue was 1.35B (not 1.35B for the quarter), so divide my price target by 4 - $125/share or $8B market cap.

A message to the Short Bus

Salt Lake City Baseball - 1958 (Year 4)

This is Year 4 of Salt Lake City Baseball, where we take the small budget Salt Lake City Alpines of the United Baseball Association and help them become a perennial playoff contender - with house rules stacking the odds against us.

1957 Recap

Here's full write-up's of previous seasons: 1955, 1956, 1957
We finished 1957 with a 68-94, improving over the previous year by 5 wins. I made a big trade, giving up a power-hitting #1 overall pick that was making his way through my system for a starting pitcher with an injury history. A risk? You bet. But it's the kind of bet that I think will work in our favor, in the grand scheme of things.
I'm excited - I think we have a chance to get to .500 this year. We'll see if I eat my words by the end of this post.

The Offseason

First things first - let's see what we're allowed to do this year. We use our RNG and get the following results:
50+ Free Agents allowed: 4
Trades allowed: 1
Oof. As I've mentioned, trades are much more valuable to pick typically, so having one to work with could be tough, but we'll deal with it.
We're immediately tasked with making decisions, something we've pretty much avoided to this point. In the expansion draft we took so many young players that the only thing I've really needed to do is non-tender a few terrible arbitration guys. In fact, I've typically had just three or four arbitration-eligible players to get through. This year, we have eleven.
We also have three players with team options, as well as CF Jesus Silva, who declined his player option after a 4 WAR season and is now a free agent.
Assuming we sign our arbitration class, and pick up all of our team options, and keep our player development, scouting, draft, and IFA budgets the same, we have a paltry $300K in budget room left. So let's get to work.
We have team options on RP Jayden Ziegler for $1.6M, SP Jose Chavez for $1.5M, and 1B Juan Sera for $5.25M. Minimum buyout in this league is 25%, so assume the buyout is exactly that.
Ziegler is the first one to get picked up - he was a guy we targeted to move to the pen exclusively and thought his skillset would work for our club, which it absolutely did, improving his ERA from 5.12 two years ago in Philadelphia to 3.26 here, and his 2.53 FIP tells me he could be even better.
Chavez was another guy with a 5+ ERA we thought would improve coming here - he did, but not to the same extent, finishing with a 4.84 ERA in 23 starts. His strikeout rate dropped a hair, while his walk rate went up. Still, $1.5M isn't a ton, and I don't have a ton of pitching depth to fill his spot if he leaves, so we accept his option as well.
Sera is a bit more interesting because with such a low budget right now, that $3.75 million could help. He was very, very good for us, with a wRC+ of 153 - a whopping 193 against LHP which was where he was typically slotted when the lineup was at full strength. 1B Shane Ennis, our 1B against RHP, was decent in that role (107 wRC+) but completely sucked when facing same-handed pitching (45 wRC+). Now that I'm looking at it though, maybe Sera should be our full-time 1B - he's a much better defender there and can also play 2B in a pinch. I decide to pick up his option - we can always trade him if needed, though I need to keep in mind I can only make one trade all season.
In terms of free agents, RP Sal Sosa finishes his two-year deal with us with fifty total saves, and this last season he had a FIP of 2.89. He wants about $8M a year for three years, so it's rich for our blood, so he'll walk and take his talents elsewhere.
CF Jesus Silva, who I made a deal for prior to last season, contributed very nicely for us, leading the league in doubles with 47 and a 104 wRC+. But he struck out a career high 22.1% of the time, and had a BABIP higher than his career average. He wants over $10M, so he won't be back, but he won't discuss a deal with me, meaning I'm not sure if offering him arbitration makes sense. Him accepting a $17.5M deal would destroy us financially and I'm not sure I'd be able to trade him with that big of a contract without eating some of it. It's a risk I'm not willing to take, so he'll walk as well.
Okay - let's dig into some of the arbitration decisions. As mentioned, there's eleven guys here, but just two of them have four years of service time - none with five or six, but a bunch with two or three. So most of these guys are cheap. Nine of the eleven players want less than $1.25M.
3B Ricky Rojas is not one of those guys - he's a super-two player who wants $4.6M after finishing with 1.7 WAR. He crushed LHP with a 154 wRC+, but struggled against RHP at just 85. In 611 PA's he struck out just 42 times. I like that - but his defense was less impressive with -6 ZR at the hot corner.
2B Seth Glisson is a 31 year old who's asking for around $2.2M in his first arbitration year. He has started to fully take advantage of his speed, stealing 52 bases and getting caught just 6 times. He's had a weird career, his BABIP wildly swinging from .408 to .257 and then .342 last year. The 3.7 WAR makes this decision easy - he's helping us win games with his speed alone and while his defense isn't great, if he can keep his BABIP from swinging wildly back down we'll have a solid player on our hands.
Since everyone else is relatively cheap and somewhat inconsequential, I use this opportunity to trade Rojas and get some money off the books - I can use that money to find someone who doesn't have such big splits and is maybe a better defender. Rojas has decent value to teams, with some interesting guys available, but I settle on a deal with Montreal with RP Dan DeKing, a RHP with a fastball/slider combo that leads to high stuff, posting 11+ K/9 in the minors.
RP Dan DeKing
OSA likes him even more, rating his stuff as an 8. More pitching depth is always good, and a guy like this could be part of a cheap, effective pen in the future. He'll go to AA to start his time with the Alpines.
1B Shane Ennis is only looking for $1M, but I'm going to let the right-handed 1B Juan Sera take that spot full-time. I have another left-handed 1B in AAA, so if I feel like a platoon is necessary I have an option. But Sera was better against same-handed pitching than Ennis was against his opposite - so this makes sense to me. Ennis was a solid player but doesn't really have a place on my team. He gets non-tendered.
We wrap up by offering everyone else a one-year deal, though we have to go to court with two guys who don't want to negotiate.
We learn that C Kevin Carson has won his second consecutive gold glove. We unsurprisingly don't get a single vote for any other awards. Before we head into free agency, here's a quick look at our farm system.
Salt Lake City Alpines Prospect Pipeline
We have a core of guys now at A ball, so our plan is to shoot for 1960 as the opening to our main window of contention. Targeting college players closer to major-league ready could be a better option now, but we'll still focus mainly on taking the best player available.

Free Agency

Our two biggest areas of need are on the left side of the infield, but we could always use another arm in the pen. I would love a switch-hitter at one of those spots, but if not, a RHB is preferred. In the pen, either handedness would work for me.
I make a shortlist of four pitchers and four bats - I'll need two of the hitters. I'm looking for contact ability, defensive ability, and someone who's affordable, which means we're probably looking for someone we can get more out of, or someone who looks like they can bounce back from a bad year. On the arm side, it's the same cheap reclamation stuff we've been doing - RP Jayden Ziegler was a success here, going from a 5.12 ERA with his previous team to a 3.26 with us last year - but also a focus on strikeouts. Our defense is not quite where we want it to be - we finished with a -22 ZR as a team last season - so a focus on missing bats is going to be key.
I have about $10M to spend. I'm comfortable spending all of it, and luckily our RNG roll earlier will allow us to sign up to four 50+ rated guys. But we will still have to do our 2-8 roll each week and roll as high as the player we're offering (e.g. to offer a guy who's a 55, we need to roll a 6 or higher) and can only make one offer per week.
We get to our first roll, and we get a 6. RP Juan Camacho is who we really want as our arm, but he's a 65, so we'll have to wait. The high BABIP last year and K/9 make me think he's great but could do even better.
Free Agent RP Juan Camacho
We will make an offer, however, to SS Rich Reynaga, who spent 1957 with the St. Louis Lions. While there's a few 3B options, this is the only true shortstop on our shortlist so while we have the chance, we need to make our offer now. He had 480 PA's with the Lions last year, hit 10 HR's, and finished with a +2.9 ZR at shortstop. He's got a canon for an arm and great range. He'll be 34, but we're okay with him on a short-term deal. We offer him $2.5 with a second-year team option.
Free Agent SS Rich Reynaga
The following week comes, and this time we roll a 5. All of our 3B targets are eligible, and I'm having a tough time deciding on who to go with. Manny Avila is super intriguing to me with his speed, but he spent all year in AAA in '57 and the lack of eye and power isn't good. The other two guys are switch-hitters, which would work out nicely in my lineup, but Jaylin Burnett has the same issue as Avila with the bat. Mike Gremillion is the better hitter overall, but no speed hurts and his defense isn't great.
Our 3B targets.
I dig a little deeper, and look at splits - Avila and Gremillion are definitely better against LHP, while Burnett has a pretty clear split favoring him against RHP. This leads me to find that we had a .562 winning percentage when facing LHP last year, but .385 against RHP. We clearly faced many more RHP, but that's just another reason to lean towards Burnett. Even if he can't hit lefties, he's utilizing his strength about 80% of the time.
Jaylin Burnett gets an offer, a $3M deal with two team options with $750K buyouts. He's not trained at third yet, but we'll get him time there in spring ball and his ratings suggest he should have no issue there.
Free Agent IF Jaylin Burnett
We get some luck when the following week rolls around, we learn that RP Juan Camacho (shown and discussed a paragraphs above) has signed with Montreal - here's a great example of why I like my house rules. I would have offered this guy immediately, and almost certainly got him, but I lose my chance to sign my top relief target and now I'm forced to go back to my shortlist and go with a lesser option.
I end up reaching out to southpaw RP Sal Sosa, who spent his last two years with us. We know how he works in our park, and his FIP was nearly a run lower than his ERA so maybe we can squeeze a little more out of him as well. He gets a $4M offer with a $5M team option for the following year.
The Rule-5 Draft comes around, and we have a few open spots on our 40-man. We have a house rule that anyone in the Rule-5 has to be 26 years of age or older, AND we have to do our 2-8 roll and end up higher than his rating. We end up taking SP Ryan Thompson, a LHP from the Boston Yanks organization. He's got a good pitch mix and has had success in the minors, but it's a low-risk move a team like ours can make.
Rule-5 selection SP Ryan Thompson
We continue on, and SS Rich Reynaga signs with us, filling a big need. RP Sal Sosa rejoins the club as well, solidifying our pen, and a few days later 3B Jaylin Burnett puts pen to paper. We've used three of our four available free agent signings, and have $2M left to spend.
I get to pre-season, and one of my targets 2B Manny Avila is available on a one-year deal for $1.5M, so we roll to see if we're eligible to offer and we are - he signs a few days later and he becomes our starting 2B against LHP.

Opening Day

We finish the spring 11-19 with no major injuries, and we're set to play the Chicago Packers, our division-winning rivals, on opening day. We played through this one, and it was a rough start - our SP Juan Chavez went out with an injury, our new SS Rich Reynaga will be out for five weeks after getting hit by a pitch in the foot, and then a reliever also had to come out with an injury. We gave up 4 tuns in the 3rd, and then blew a bases loaded opportunity in the 8th. But in the 9th inning, our late offseason signing 2B Manny Avila came through with a game winning single after 2B Seth Glisson stole a bag. Our speed really caused some trouble in this one, and we take opening day 5-4.
Opening Day, April 7th, 1958 - Chicago Packers (4) at Salt Lake City Alpines (5)
While our big deadline trade last year SP Rob White had a terrible spring training, we were looking forward to his first start, which he made against the San Francisco Peanuts. He went five strong innings, striking out eight while giving up no runs and only two hits.
We start strong, going 5-2 to start the year, but by the end of April we fall to 9-13 - injuries have hurt us, with SS Rich Reynaga out for the first month, as well as 1B Juan Sera, and SP Juan Chavez. On May 10th, all three are back, and we look to really get things going in the second half of May.
Scratch that - four days later, Reynaga and Sera are hurt AGAIN. Sera has to go to the DL, but we let Reynaga play through it. On the 17th, new 3B Jaylin Burnett, who's got a .333 OBP, goes down for a month. Ugh. We finish the month 20-28,

The Draft

Before I get into the draft, let's revisit the trade I made at last year's deadline:

There is one avenue I explore - the Baltimore Atlantics have already traded OF Matt Storms, all-time home run king, and are selling. They have SP Rob White, 26, who looks like a great young starting pitcher who would fit in really well here. This is an opportunity to grab someone that I would not be able to get in free agency. Obviously, they want a lot - they ask for our former #1 overall pick OF Rich Schaffer.
Schaffer looks like he's going to be good - lots of power, left-handed. His defense is good - but it's not great, and he has no ability to steal or run the bases. I worry about his performance so far in the minors as well. White is also listed as fragile, and after digging into the injury history, I see that he missed 22 months(!) with a torn rotator cuff after a setback. I ask about some other permutations of players to get White, but all ask for two pieces, a decent shortstop prospect and more importantly my screwballer SP Stephane Gonnet, who I'm too excited to see to move.
In the end, I consider how hard it's going to be to sign a SP of that caliber as a free agent, both in terms of availability and of course my shoestring budget. I have a few nice OF's in the minors beyond Schaffer - and I make the move. White goes to AAA for a few to get his feet wet but he'll be up in a week or so. We also demote SP Mario Ibarra, who's been struggling all year after a great season in 1956.
White comes up on August 2nd, making his Alpines debut against the San Francisco Peanuts, going 5 2/3 innings with 6 K, 2 BB, and just 1 ER.

Eleven months later, and I worry that I didn't make the right move. White's ratings still look great - but he's struggling. Despite a 2.79 FIP, he's got an ERA of 5.05. Last year, he under-perfomed his FIP by more than two runs as well. His BABIP is high right now at .373, so it's probably bad luck. But I need the bad luck to turn around. Schaffer looks even more like a stud now:
OF Rich Schaffer
His potentials are bumping, and I probably did not make the right move here. We'll see, but if White doesn't turn things around I'm going to be kicking myself. I cry even more thinking about how I could have sent over 50-rated screwballer with a shortstop I forget the name of to get White, but was too intrigued by the screwballer to do it.
Let's turn to the draft - entering the day we're 20-32. We've dropped to the 5th pick two years in a row, and this year we're at the #5 spot before the lottery, so maybe our fortunes will reverse. There will be 10 picks in the hopper - Pittsburgh is at #1, followed by Oakland, San Diego, Baltimore, and then us. Let's do it.
We get to pick 7 without much movement yet, but once we're there, Oakland pops up, dropping from #2 to #7, and then San Diego from #3 to #6. So we'll at least stay at #5, but we're hoping for better.
Nope. No luck, as we pick 5th again, for the third year in a row. Milwaukee is the lucky team this year, moving up from #8 to the 1st overall pick.
There's two guys I REALLY like, and another guy I like who would probably have to play 1B which makes him less exciting, but his bat should be incredible.
SS Joaquin Garcia, projected to go #1 to Milwaukee
2B (more realistically 1B) John Soria, projected to go #2 to Pittsburgh
SP Victor Sanchez, projected to go #3 to Baltimore
I like these three guys and would be happy with any of them, but I'd prefer a bat. If Sanchez is there, I'll take him, but if not, I'd be looking at one of these three guys:
3B Chris Jones, projected to go #4 to Detroit
SP Chris Gleason, projected to go #5 to Salt Lake City
LF Aaron Altenbach, projected to go #7 to Oaklad
I'll get one of these guys, obviously. But as of right now, I think my plan is I'd take whoever is left of Garcia, Soria, or Sanchez. If all of them are gone, I'd go to Gleasson, then Jones, then Altenbach. A wild card is CF Chris Burke, who isn't projected to go until #14, but he's a much better defender than Altenbach but less power.
Milwaukee kicks things off by going with SS Joaquin Garcia, and Pittsburgh follows the board with 1B/2B John Soria, as does Baltimore with SP Victor Sanchez. Detroit takes SP Chris Gleason, so now I'm between the three hitters I've discussed. The defense of Jones and Altenbach bother me, of course, but Jones to a lesser extent.
I make the decision to go with 3B Chris Jones - OSA is obesessed with him, which pushed me a little more in his favor, and I just can't play a BAD defender in my outfield, so Altenbach would have been in a tough spot.
We get through June and it's ugly - we're 25-52.

International Signing Period

We have $7.5M allocated for this period, but anything over $6M will get taxed at 100% and make me have to skip next year, so I'm always hesitant to go beyond that number unless there's an absolutely monster - this year is another year where the best player is rated as a 50 potential, but we do end up spending our whole amount to bing in two players. CF Javier Dominguez, 17, is a contact-focused LHB, and 3B Baldassare Jauregui comes in just for the amazing name. He's a 16-year-old Venezuelan, also contacted focused, but bats right and has good speed.
We'll be limited to $500K next year, but realistically we're not going to afford the top players anyway. This year, two players went for over $20M, $14M of which was taxed at 100%. We're not that rich.

All-Star Break

We head into the break at a very disappointing 29-59, and it's time to dive in a little deeper into our runs scored/runs allowed compared to last year.
1957: 3.7 runs scored per game, 4.4 runs allowed per game.
1958: 3.7 runs scored per game, 5.0 runs allowed per game.
Yea - this doesn't surprise me, as every time I look at our pitching staff we have four of our five guys over a 5 ERA. SP Rob White is also out with chronic back soreness - we don't know when he will be back, and even when he is, he's severely underperforming what we think he could do. RP Sal Sosa is also underperforming with an ERA over 6.
Our FIP, however, isn't terrible, with no one over 5. It makes me think that our defense is what's holding us back.
With no trades available, we continue on through the trade deadline, finishing July with a disappointing 34-67 record, and any help we can is going to have to come from inside. While most of our prospects are in single-A, we do have two relievers in AA who we promote to AAA - we're going to need their help sooner than later.

End of Season

Without much more we can do, we power through the rest of the season. There's positive news, as we finish September 14-13, and go 4-1 to finish things in October, bringing our final record to 61-101.
1958 Federal League Standings
While Georgia and New Orleans head into the post-season from the Federal League, the Columbia League's Philadelphia Patriots and Kansas Grays will play in their League Championship Series.
Both the Patriots and Peaches move on, and the 1958 World Series goes to Game 7, and it's a wild one. The Patriots led 3-2 going into the top of the 9th, and the Peaches pounced on SP Ryan Oliver, a starter who came out of the pen in the 8th and was tasked with closing the series out in the 9th, giving up three runs. They wouldn't score in the bottom of the inning, and the Georgia Peaches are your 1958 World Series Champions.
After improving year over year since 1955, it's a bummer getting back to a 100-loss season. We did start to turn things around at the end, and I do think there was definitely some bad luck involved - between the injuries and the overall underperformance of our FIP by our pitchers.
1958 End of Season Team Stats
Our June record of 4-24 truly killed us. A .400 winning percentage that month would have netted us seven more wins, which would have made the season a bit more respectable.
We'll take a look more at our individual performances in our 1959 recap - so until then, I'm happy to answer any questions, and thanks for reading! See you next season.

Achievement Unlocked: Thetagang For Life

Sports Betting Tax Advice from my CPA

I wrote a long reply on why gambling, and loot boxes in particular, are bad...

So, inside some other post, I was asked why gambling is bad... My reply ended up being really detailed, so I'll promote it to a post of its own (just copy-pasting it here; no new words)... [Note: list of 3 points about loot boxes at the end...]
(I work at a company that sells gambling services... I see how the sausage is made...)
By the way, I love PoE and GGG. Still, loot boxes are bad.
I personally get to see the statistics side of oddsmaking. It's always about suckering you out of your money, because by definition all you are doing is paying more money as the price of getting less money (on average), but you also need to feel like you have a chance at getting the upper hand, even though in the long run you don't.
For example, sometimes, if you're really "good" at betting, you just end up working for the oddsmaker on a bad deal. It's really hard for them sometimes to get the odds perfectly right (although the profit margin still takes care of 99.9% of punters). So, if you're a professional gambler making a regular profit, what's basically happening is that you are investing an enormous amount of time and expertise to try and make tiny profits at the margins, and the bookmaker monitors your activity and learns about the market from you, at what ends up being a lower cost than if they hired experts to give them the same info on a salary. Plus you constantly run high risks! Which is why my company is full of ex-gamblers who were able to make a profit for a while, and intelligent enough to realise that they were still getting a bad deal, and come to the company and offer their services directly. (For another way gambling companies guarantee their own profits by passing on the risk to gamblers, research "balancing the books": yes, a professional gambler could make some profits this way, but if you're possibly making profits by taking on a risk that a large gambling corporation wants to get rid of, do you really think you're getting a good deal, especially considering how much time and expertise you sink into the activity? EDIT: more info)
The only way I know of to make a consistent and considerable profit off gambling is when a pro gambler is allowed to make a profit off other gamblers, in a move that a company makes to increase total amounts played. So, for one person to profit, many others are being seriously scammed, and the company is safely skimming its percentages off the top.
There are many different ways a gambling company presents bad deals to you, hoping that your intuition misfires about one of them and you decide to throw away your money. Examples... There are single bets, of course. But then there are also combinations, and these screw with your intuition--you can convince yourself based on a narrative (e.g. team 1 wins first half, team 2 comes back in second half), where in fact the actual hard cold odds are against you. There is "cash out" where you take a fraction of a likely-seeming win early (but at a loss), which of course simply taxes you for your risk aversion. There are "systems", creating more and more complex bets, until you convince yourself you've set up the perfect deal, and yet the company's profit margin keeps growing the more complex you make it.
Anyway, those are the parts I work on as a software guy. (By the way, this isn't the worst thing in the world, it's not as bad, as, say, the military industry or the military itself, or say religions or banks, because at some level gambling is voluntary. And making gambling illegal is a terrible idea-we should fight it through education, not prohibition. Still, I only work there because I'm currently a completely non-creative software grunt (and currently satisfied with that). If I get to the point of pursuing higher-level jobs, I'll look elsewhere.)
But the most nefarious part of all is the psychological work they pull on you. That's not my area of expertise, so if you want it explained you need to look elsewhere (recommended book: Thinking Fast and Slow--it's not about gambling, it's about psychology). They are constantly doing things to 1) give you false hope and 2) artificially trigger some pleasure response in you.
E.g. most people are naturally risk averse and loss averse, e.g. losing $10 brings more pain than winning $10 brings pleasure. In reality, a gamble is about paying, say, $10 to win an average of, say, $9, so that's a terrible and painful deal. In addition to all the advertising and bright colours and encouraging sounds and making you read success stories and all the other psychological manipulations, they can also straight up befuddle you with numbers. So, losing $10 brings more pain than winning $10 brings pleasure, but what if you pay $10 but you're not really at a risk of losing that much, because on average you win $9 back, so you're only really risking a single $, and yet if you get lucky you won't win a mere $10 but millions? Suddenly that sounds good, right? Risk $1 to win $10000000? Of course not: you're still risking $10 and taking $1 losses on average each time you play, and the high rewards are vanishingly rare and built into that average.
That's it about gambling for money. On loot boxes I'm no expert, but, beyond the basic problems (encouraging addiction, exploiting minors who beg money from parents and don't understand how they're throwing it away, generating gambling "pleasure" while giving you "bits" instead of any real value, etc), I can point out a couple of extra scummy aspects:

They can say "the box costs 30 points but all the possible rewards are worth at least 50, the average reward is worth 70 and the best is worth 400"... really??? Those prices are completely arbitrary... Who says the footprints are "worth" 50 or some random hideout decoration is "worth" 200? Talking about average microtransaction point values in a loot box is completely misleading.
Either you (a) lose on the statistics of getting complete sets or you lose on (b) being psychologically manipulated into buying extra stuff you didn't actually want so much (or (c) you just lose by getting useless stuff). Let's say you decide to pick up a couple of boxes and see what you get before buying more stuff. You might just get useless stuff, of course (case c). But what if you get the body armour or wings? Now you might say "I'll get more boxes to complete the set". But the chances of getting any one part of a set are not anywhere near as bad as your chances of completing a set (like map lab trials, but much worse because loot boxes contain many more items), so you are getting totally fleeced (case a). Alternatively you could go "oh look, I got x in the box, I'll buy matching items y and z from the shop later" so you think you got x cheap and y and z at normal prices. But you are being manipulated into buying y and z. Would you really have bought x and y and z from the shop if there had been no loot box? Only rarely. The rest of the time you are overspending (case b).
Loot box gifts are another scummy behaviour, considering people don't have good intuitions about statistics. Most of us get bad results from the gifted boxes, but some will get lucky. Those of us who are already gambling on loot boxes won't be affected by the outcome of a few extra boxes. Those who wouldn't ever buy them normally, and get bad results, who cares. But those who wouldn't normally buy them but get lucky a few times in a row might decide it's a good deal after all. So, it's manipulating us psychologically in a way that is statistically designed to fail at no cost most times and succeed sometimes, which makes money. (While also giving everybody holiday presents or race prizes, making the company appear generous.)

My Options Overview / Guide (V2)

Greeting Theta Gang boys and girls,
I hope you're well and not bankrupt after last week. I'm just now recovering mentally myself. I saw a few WSB converts and some newbies asking for tips, so here you go. V2 of my Options guide. I hope it helps.

I spent a huge amount of time learning about options and tried to distill my knowledge down into a helpful guide. This should especially be useful for newbies and growing options traders.
While I feel I’m a successful trader, I'm not a guru and my advice is not meant to be gospel, but this will hopefully be a good starting point, teach you a lot, and make you a better trader. I plan to keep typing up more info from my notebook, expanding this guide, and posting it every couple months.
Any feedback or additions are appreciated
Per requests, I added details of good and bad trades I made. Some painful lessons learned are now included. I also tried to organize this better as it got longer.
Here's what I tell options beginners:
I would strongly recommend buying a beginner's options book and read it cover to cover. That helped me a lot.
I like this beginner book: https://www.amazon.com/dp/B00GWSXX8U/ref=cm_sw_r_cp_apa_OxNDFb2GK9YW7
Helpful websites:

Tasty Trade (TT) and Ally Invest have helpful articles and videos.
- https://www.tastytrade.com/tt
- https://www.youtube.com/c/tastytrade1/featured
Ally training:
- What is options trading? https://www.ally.com/do-it-right/investing/trading-options-for-beginners/?CP=EM2012111
- Top 10 options mistakes: https://www.ally.com/do-it-right/investing/top-10-option-trading-mistakes/?CP=EM2012111
3 common option mistakes: https://us.etrade.com/knowledge/library/options/common-mistakes-options-traders-make
Common options strategies: https://www.optionsbro.com/basic-options-strategies/
Investopedia has tons of great investing info for stocks and options: https://www.investopedia.com/
Kamikaze Cash Theta Gang Videos: https://youtube.com/playlist?list=PLOweupE79XXiBaeH_xBpkUcYUsrAaKQen
20 rules of professional traders: https://www.investopedia.com/articles/active-trading/022715/20-rules-followed-professional-traders.asp

Don't trade until you understand:

You can lose your entire contract value when buying.
You can lose a lot of money when selling "naked", theoretically unlimited.
How option expiration works.
Theta (decay) and how it works. This is imperative since it's attrition when buying and a payout when selling. https://www.optionseducation.org/advancedconcepts/theta
DTE: Days till expiration/expiry
Options positions with respect to price:
- ITM: In the money; strike is below stock value. Signif
- ATM: At the money; strike is just at or above the stock value, often very highly traded. Can be very effective with moderate - long term expiry.
- NTM: Near the money; strike is above the stock value, but fairly close. Slightly unofficial term.
- OTM: Out of the money; price is at least a few strikes from the current stock price. I would say 10-30% over stock price.
- Very OTM: Not a real definition, this is essentially a lottery ticket. Cheap, but almost certain to expire worthless unless there is explosive movement.
Understand delta in general and how delta changes with ITM and OTM options.
Understand all the greeks at a high level, as you get better understand them well. The greeks: https://www.optionsplaybook.com/options-introduction/option-greeks/
IV, IV crush, and how IV affects pricing. In general, you want to sell when IV is high and buy when the IV is low. Increasing IV is good for held calls/puts. IV drop or crush is generally good for sellers.
Selling options can be quite beneficial. Once you have a good general understanding, lookup thetagang . Kamikaze Cash has good youtube videos on most theta strategies (linked above). I personally believe selling options (especially cash secured) is much safer and can consistently make you profits. Θ Gang 4 life.
FOMO and how to avoid chasing a dangerous trend. DO NOT CHASE FROM FOMO!
What intrinsic and extrinsic value are. Know how they are affected by being exercised/assigned and how theta affects them.
Understand that some of WSB recommendations are straight up high-risk gambling and factor in the information accordingly. Be careful with Meme stocks and the survivorship bias on YOLO plays. However, I love the sub and think it’s hilarious. It has a lot of valuable information / DD if you are comfortable with the “colorful” language. It’s also great if you like rocket ship emojis.

Basics / Mechanics

Understand the 4 "main" option types. Buying or selling a call and buying or selling a put. Spreads and more complex multi-legged option strategies are based off these in some way (see below)
You can sell calls with 100 shares of stock or if you own an underlying longer term option; see LEAPS and PMCCs later. Selling calls naked is incredibly risky and often requires Level 4 (very advanced) permissions and usually a lot of capital. I will literally never sell calls naked since I don't want to ruin my life and end up living in a dumpster eating saltine crackers.
Puts can be sold/written cash covered (cash secured), which means you have the cash in your account to buy 100 shares. Your broker will put this money on hold until the trade is closed. Puts can be sold "naked" using Margin and Level 3 (with most brokers). Your broker will hold a percentage of cost of 100 shares (often 30-40%, 100% on meme stocks) allowing you to sell more puts. This increases your available capital/power as well as increasing risk.

General Tips and Ideas:

Don't EVER leave (short) spreads open on expiration day, close them. (more details below)
Start off trading very small. Slowly build up over weeks / months. You need to get accustomed to a fifty dollar swing a day, then a few hundred, then a few thousand. You need to ensure you don't get emotional (see below). I started trading options with 5k, then 25k, 50k, and later over 100k. I added my own funds over time and used my gains to build my account. Don’t go all in immediately, that’s dangerous and unwise.
Especially as you build up the amount of money you have invested, keep it diversified among several stocks.
- Don't go all in on one thing, ever. Be able to take a hit from one stock and not mortally wound your portfolio.
- A company may be doing great, then there's a major product issue out of nowhere. If you are overexposed in one stock this can really hurt you.
- I had to roll options I sold that were about to expire completely worthless because FDX's CEO changed and the stock took a hard dip.
Don't trade emotionally. If you realize you are emotionally trading for vengeance, you should probably exit the trade and cool off for several days with that stock. Same if you get caught up in a wave of hysteria.
Have a plan for every trade, ideally with entries / exits that are specific values, ranges, or a set condition. This helps remove emotions. This is super important for strong movements and high volatility (see later).
Use an options profit calculator from your broker or an online one before entering a "new" trade, especially a complex multi legged trade: https://www.optionsprofitcalculator.com/
“Rolling” an option: Closing your existing option and opening a similar one at different strike and/or expiration.
- Rolling a call “Up” would be selling a call you own and buying a cheaper call at a higher strike.
- Rolling a put “Down and out” closes your original one and buying or selling one at a lower strike at a longer expiry.
- Better broker interfaces have a literal “Roll” button. I know E-trade does. You can manually do it by selecting relevant contract legs.
If you have a losing trade, re-evaluate it. If your initial assumption is definitely incorrect, close it. Don't stay in losing trades forever and lose the entire value of the option over stubbornness. If you re-evaluate and you think your assumption was right, hold, potentially consider adding another cheaper option (or buy another call / put). Rolling out sold options can help here.
Don't try to day trade, especially with options. It's statistically unlikely to be profitable. Day-trading with options introduces extra liquidity risks and is dangerous, especially with spreads.
Try not to over-trade, you'll likely mis-time the market over time. When I get emotional I over trade, then lose additional money on wash sales. If you scale your entries into positions it should help alleviate your desire to exit positions when they turn badly against you. Whenever I buy calls I do it at larger increments after W almost made me loss my hair; luckily it eventually came back.
NEVER enter a position on a stock you have no idea about, especially when you read about it online or heard about it from some rando.
At market open options contracts are often volatile and inflated. Buying during this time can be more expensive. Options are usually cheaper mid-day, I read somewhere 2-3PM is cheapest. I’ve had success around 12-1PM EST after prices settle.
Try wheeling on cheaper stocks once you get all fundamentals down.
When selling puts if you are very bullish consider "doubling down"; note this is higher risk. Use the credit from your put sale to buy shares or a cheap call. This can be roughly inversed with puts, except I wouldn't ever recommend shorting shares.
Learn from your mistakes. You can’t go back in time and beating yourself up (to a point) is useless. Make a physical &/or mental note of it so you don’t do it again. If you don’t learn from it, then beat yourself up so you won’t do it again.
If you have friends that like to trade, I find it helpful to discuss strategies and planned plays. I talk openly with my close friends about my current holdings and planned trades, it helps keep me accountable. If I get a wide-eyed look, I might be doing something excessively risky or stupid. I’ve over-leveraged myself in calls twice and I knew I shouldn’t have done it both times. When I tell my friends what I did and I’m embarrassed, it exemplifies the face that I shouldn’t have done it in the first place. You will also get ideas for new strategies or plays from them. It’s good to stay versatile and use multiple strategies when appropriate. Beware of group think/echo chambers.
I recommend NEVER telling someone what to buy/sell and when. I’ll tell people MY plays or what I like and why, but I will not encourage them to emulate what I do. Depending on the audience, I’ll tell them my exact positions along with my exit and entrance strategy. With closer friends I’ll offer my thoughts on their trades (if asked). If my friend is doing something really risky (one of my friends does some scary stuff) I may ask them if they want my advice, and provide it, especially if they overlooked a risk/event. I will not encourage someone to execute/enter a trade since it has a high potential for hurt feelings or animosity all around.
Don’t fall in love with a stock. Just because something made you money before and you have high confidence in it doesn’t mean it will keep performing. I joke that FDX betrayed me when it started dipping and losing me money. I was over-confident of its bounce-back and sold too many puts too quickly. I’m in several losing trades because of it. However, I will keep good stocks in my rostetracking list or try different strategies or re-enter trades when they change their behavior.
As you start to both buy and sell options and get more experience in general, you'll start seeing the two sides to every trade. You will likely start adjusting your strategies or trying new trades out because of this. Things will likely click one day. Most/all the greeks and options concepts will become almost second nature. For me this was when I could build an Iron Condor from scratch, which was a watershed moment involving a good understanding of many strategies.
Understand Liquidity and volume.
- Trading in low volume, low open interest contracts results in wide bid/ask spreads and difficulty having your contracts filled. Look at all the data for a contract, not just the strike and price.
- Monthly Expiration dates typically have better liquidity.
- Multi-legged trades (Common examples are 2-legged vertical spreads or 4-legged iron condors) have more difficulty being filled, especially on bad brokers like Robin Hood. Having very liquid options for all legs is extremely helpful in obtaining timely and well-priced fills, which maximize your potential profits.
Time in market vs timing the market:
- It is extremely difficult to time the market perfectly. If you wait for the perfect opportunity forever, history has proven you will miss out on gains. Keeping all your money out of the market has proven to be ineffective. Now if there is something serious happening with a stock/the market (like say a new pandemic), don’t go all in. I recommend entering incrementally at dips. If the stock has huge upside potential it may never go down, so it might make sense to partially enter at the current price.
- IMIO selling puts is a great strategy to get into a stock you like, or at least make money off it. I think buying stock in lots of 100 is usually for suckers. Selling an ATM or ITM put (assuming the math works out) on a stock you were going to buy and hold is ALMOST free money.
- I recommend keeping some cash available regardless. If you have a very large account or expect a downturn, hedging with indexes like QQQ, SPY, or VIX or calls/puts may be wise.
Every trade can't be a winner. You will take some losses, you must get used to it. I don’t like having a realized loss of 1K or more on any trade. However, this will happen, especially with larger accounts.
- As long as you win more often and beat the S&P that year I consider it okay. I’m kind of aggressive, so I consider 20%+ annually good. 30%+ annually is great. 40%+ and I’m dancing. After trading options I am almost baffled by my old belief that 5% annual returns (mostly from dividend ETFs) was “good”. That’s nothing to me now since I’m willing to take risks. Note: While lots of people danced in 2020, realize that’s an insane Bull Run year and is atypical.
- Adhere to your own risk tolerance and never over-extend yourself, especially with margin use. Don’t make huge gambles leaving you uncomfortable. Only gamble with money you are willing to lose.
- My personal strategy is to make safer gains for the year and then enter slightly riskier strategies using those gains. I can be slightly-moderately more aggressive and compound my gains. For me I often sell puts to make money, then when I see a big opportunity I’ll sell a put and buy an OTM or moderately ITM call.
Understand it’s not safe to try and get rich overnight. However, once you hit big “steps” things may start to snowball. You can enter more positions and take more risks if you choose to.
- For me this when I hit 50k, then 100k. I was able to balance low and moderate risk positions to more significantly grow my account. I’ll even do a high risk thing now and again because my gains can absorb it (assuming I have them).
- I can’t wait to get to 250K, then 500K. I know it’ll take quite a long time, but I am confident I’ll eventually be able to have 500K and (hopefully) 1M in my non-401k trading account with gains and additions from my job. I can only imagine how “dangerous” I will be with that kind of capital.
If you missed "the next big thing" like AAPL, TSLA, or the time machine I’m building in my basement. Don't get upset, learn from it. Adapt and become a better trader for next time.
- Figure out why a company was so promising, before they mooned. Determine how you would have traded differently in hindsight. Apply those lessons to the next company you believe has long term growth prospects.
- For me that's putting in 1-2.5k towards shares and/or buying LEAPS on it. Depending on my bullishness I may buy “cheap”, fairly far OTM calls. The far OTM options are sort of lottery tickets. If I'm right the (relatively) low cost will have explosive profits; if I'm wrong, they didn't cost that much so it's a calculated loss I’m willing to accept. For more serious bets I’ll buy ITM LEAPS to run PMCCs on. I also like to buy 1-2K in my 401k for very long-term plays.
The stock market hates uncertainty, it seems to crave the status quo. A shakeup can potential tank a stock, even if it's nothing. With shares you can wait it out, but this can be problematic for options. If you see volatile/uncertain times ahead (politics, disease, manufacturing, earnings, etc.), you might want to reduce your overall portfolio risks or hedge.

Profit Retention / Loss Mitigation

If selling options, it is a viable strategy to close early after a large gain with many DTE left until expiry. See TT videos / strategies on this.
Don't hold options through earnings unless you literally want to gamble. I like playing on earnings run ups, but that can be risky.
If you hold options through earnings, IV crush will happen immediately afterwards, devaluing the option. However, if the option is profitable enough, IV crush won’t matter, which will still make money for a call buyer. A sold put sufficiently far OTM will benefit from IV crush, even if the stock dips after slightly bad or lukewarm earnings.
Don't throw good money after bad. Don't gamble on a recovery if your assumption appears to be wrong or the market is flat out tanking. If you are wrong and still believe in the company, wait twice as long as your original plan (wait for your 2nd entry point vs 1st) before adding to your position.
Consider using stop losses to lock-in profits on rides up or sometimes use them to prevent losses. Note, stops can be easily triggered in volatile options. Now when I'm up a lot on calls (especially around earnings or large momentum run-ups) I always set stop losses. I have been burned too many times. In December 2020 I didn't set a SL on several thousand dollars of FDX calls I was already up on and I "lost" ~$5K of unrealized gains. If you're up big, don't get too greedy.
A possible strategy if a stock is on a tear and you have multiple options open: Close some positions (I prefer to do this incrementally if the stock has momentum), but leave 1+ open in case the stock goes into outer space/the floor. Next, set a stop loss with a little buffer below its current movement / range so it doesn't get hit unless the stock falls hard. Finally, watch the stock closely and if it keeps rising, keep moving the stop loss up in little bits incrementally. This will let you keep more profits on a hot streak, but give some protection and secure more gains. It will also help eliminate FOMO if a stock exceeds your expectations.
Have rules when to roll out, down & out, or up & out. I like TT’s roll at break even or at 1x loss and to always roll for a credit (or for me a very minor cost). Obviously these rules need some monitoring. Know your stocks, the news, and technicals so you don’t jump the gun.
- If you roll early for a credit and you’re right, it’s not the end of the world. You’ll just need to hold longer, which will obviously tie up capital. Sometimes it’s better to tie up some money (especially if you aren’t paying interest) than eating a huge loss.
- Rolling too late can be worse though. I currently have a very underwater FDX put I sold that is over 2x loss, rolling it does almost nothing unless you want to pay a debit or extend it extremely far out.
On huge options gains, I strongly you recommend taking profits by rolling up/down or incrementally sell your contracts at several different prices (this is why having multiple contracts is nice).
- Rolling up involves selling your initial call, then using a fraction of your proceeds to buy a cheaper, further OTM call with the same expiry; puts are inverse this. When rolling up I like to ensure the new option’s cost is 15-40% of my realized gains. I’ll buy a more or less expensive new optoin based on my convication to the stock and predicted movements. You can also roll up and out to get a further expiry and strike.
- This is monumentally important if you are playing with incredibly high rising stocks or during a short squeeze.
- Sad story time: I completely screwed up when I forgot to roll up, twice, during the GME gamma/short squeeze. I didn’t take my own advice; I didn’t have a real exit or transition plan and I got emotional. It all happened so fast and I was at work; the insanity of the run up and subsequent gamma squeeze caught me off guard. I should’ve clocked out and thought through the situation for 15-30 minutes to form an impromptu plan, then executed trade(s). My moderate risk tolerance coupled with my desire to take profits took over. When the stock partially cratered after a run up, I sold to retain gains. In the heat of the moment I thought the squeeze was squoze and it was going to plummet into the ground and I wasn’t being rational.
  - On 1x 4K call I would’ve made an additional 15-25K if I rolled up to a cheaper contract with some of my profits.
  - I know I missed out on significantly more with a 2nd call I had. Depending when I rolled it, it would likely have been an additional 25-50k in profits.
- I talked about learning from your mistakes above. This mistake is branded into my brain due to the massive gains I missed out on by not rolling up. I’m furious with myself as I write this 1 week after the GME gamma squeeze, I’m a planner and I didn’t plan. If anything I own is significantly up ever again, I’m rolling up (or at least setting a stop loss). If necessary, I’ll roll up a trade multiple times to keep extracting profits.
- Learn from my mistake so you don’t miss out on gains too. I strongly recommend rolling up when you are up big on a call / roll down when you are up big on a put. This enables you to take profits, stay in the game, and keep extracting more gains.
If you trade a lot of options, talk to your broker about a discount. I was getting the standard $.50/contract with E-Trade, but I traded over 300 contracts a quarter and was able to get the fee reduced by over $.10 by just asking. I am now doing more spreads and condors, so once my volume gets very high, I’ll ask again.
If you have a broker that isn’t great and you want to switch, leverage your current trading fees to the new broker. Tell them you’ll move over $### thousand if they beat your current options trading fee per contract.

Trade Planning & Position Management Tips

As you gain experience, start monitoring what kind of Delta, OTM, DTE, etc. you are most profitable with. Use it in your future trades. You'll often see the tasty trade 30-45DTE .3 Delta strategy for selling.
Before entering a trade, look at rough technicals like resistances and supports to consider your relevant strikes as well as entry/exit points. Look at upcoming earnings & dividend dates as well as stock/market news.
Consider staggering strikes and expirations for safety and diversity; it’s nice to avoid assignment on 3 puts at once because you used the same strike for all 3.
Incrementally enter positions on large rises/falls. One of my favor strategies is to buy dips after over reactions. By doing this slowly in large price "steps" it helps combat FOMO and helps you avoid getting slaughtered.
- This will also help you avoid "chasing a falling knife". It also ties into having a plan.
- I set alerts at several predetermined prices and I REALLY try not to enter new trades unless I hit my preset points. It makes me less emotional and usually more effective.
Don't buy far expiration options with poor liquidity for shorter term plays. I bought 1x GME 1-year+ LEAPS call before the 2021 short squeeze. That was stupid, I should've bought 2-3x 60-120 day calls to have better liquidity. I also paper-handed it and missed out on my lambo.
If selling options, consider rolling (for a credit) to avoid assignment when it makes sense / meets your plan. Rolling closer to expiration can be a valid strategy to get theta on your side. On the flip side, if the stock moons or plummets it could've been better to roll before it got crazy deep ITM. See rolling “rules” above.
Covered Calls:
- If a stock has a large movement range, I think it can be worthwhile to wait to open a CC after the last one is closed/expires. I have been more successful waiting for another opportunity vs. opening one immediately on the Monday after the second the last one expires.
- Consider selling covered calls at all time highs/peaks. If you sell a CC and the stock dips significantly, and you think it’s temporary, you can buy to close your CC for a quick profit, then reopen it later.
- If you own Meme stocks, selling covered calls runs the risk of missing out on large gains. On these stocks I typically only sell them further OTM than I normally would or not at all. If I do sell CC on a Meme stock I try to ensure I have 25-100 other shares that won’t be called away.

-Advanced Beginner-
Spreads

Spreads (with 2 legs) are neat because they manipulate how delta and theta act. It caps your gains and losses, but you can profit with less stock movement. Try several spreads on a P/L calculator to see for yourself.
Spreads usually require margin trading.
Spreads allow you to define max losses (assuming you close before expiration day) and use less capital.
- Experienced traders will open many spreads at identical/similar strikes to heavily profit off movement. Spreads can make you/lose you a lot of money if you are right.
- For example. I could make a $200 premium off a $500 risk trade, max loss would be $300. This is much more effective capital utilization than a naked or cash secured put, however it does not have the same downside protection or “wheel” potential as a sold put. Higher risk, higher reward.
Vertical Debit spreads: I think of these like mini calls/puts. I personally don’t use them unless calls are outrageously expensive or the break even is absurdly high, but there’s nothing wrong with them. A call debit spread will lower your breakeven and overall cost vs just a call. You can do clever things like making a positive theta call spread if you’re creative. I like doing this since I hate losing money to theta.
Vertical Credit spreads:
- Very good theta strategy to define downside/upside risks.
- A put credit spread is bullish and allows you to bet on upward movement with less capital and defined losses.
- A call credit spread is a bearish strategy that allows you to bet on downward movement. These are very cool since they allow you to sell calls without selling naked calls, which can ruin you financially. I see selling these as better than buying puts since it’s so much easier to be profitable; to be redundant, Θ rocks.
- https://www.schwab.com/resource-centeinsights/content/reducing-risk-with-credit-spread-options-strategy-0
I repeat this on purpose: Don't EVER leave short spreads open on expiration day, close them. If you don't close, they better be VERY far from the strike on a non-volatile stock. In after hours a stock can jump/dip below your strike and be exercised without the other leg to protect you. This can lead to massive, life ruining losses. This is not an exaggeration, google this and be scared. It happened to a fair number of people with TSLA. Video explanation: https://www.youtube.com/watch?v=rtVFj9nRRDo&t=315s
Short Straddle:

Trading Mechanics, Taxes, Market Manipulation

Learn about wash sale rules. They suck and are very easy to activate with options. This will eliminate your ability to write off losses. Over trading can easily cause wash sales. https://www.investopedia.com/terms/w/washsalerule.asp
Short attacks:
- Learn to recognize these sketchy attacks by hedges/firms. They manipulate the market, it’s been documented countless times. A common one is rapid short selling, which pushes the price down.
- Short Ladder attacks:
  - https://www.google.com/amp/s/seekingalpha.com/amp/instablog/11442671-gerald-klein/3096735-anatomy-of-a-short-attack
  - Some people say short ladder attacks don't exist. I've seen some very strange stock nosedives off low volume, so I tend to think they do.
- If you plan well enough and the market doesn’t give up on the stock you may be able to use it as a great opportunity to buy the dip.
Cramer explains how he intentionally manipulated the market when he ran a hedge fund years ago. Multiple links to the video are below since this video gets pulled often, Cramer / The street never wanted this to go public.
- Reuters article: https://www.reuters.com/article/cramer-interview-idUKN2036292620070320
- httpss://youtu.be/r07Gg92YjOI
- https://youtu.be/VMuEis3byY4
- https://youtu.be/JEzsfPmh894
- https://youtu.be/QFfjX8dW-QQ
- Due to this video I don’t fully trust Cramer. His show can give you stock ideas to buy (or inverse), but you never know where his true loyalties lie.
Plan for taxes if you are up big. You may need to over withhold or contribute to taxes quarterly depending on your situation. https://www.irs.gov/taxtopics/tc306

-Intermediate / Advanced Strategies (work in progress)-
You’ll notice many of these strategies inverse one another.
Options Strategy Finder
This website is great for learning about new strategies, you’ll see many links to it below.
https://www.theoptionsguide.com/option-trading-strategies.aspx
Short Strangle / Straddle

Both of these strategies profit from little price movement. I recommend using a P/L calculator to determine BE, profit, etc.
A straddle sells (or buys) two options at the same expiry and strike.
A strangle sells (or buys) two options at same expiry with different strikes.
Both these strategies involved selling a Call and a Put for a credit. Straddle uses ATM legs, strangle uses OTM legs.
Limited max profits and unlimited risk. Due to the unlimited risk, I am not a fan. However, many people like these a lot.
https://www.theoptionsguide.com/short-strangle.aspx
https://www.theoptionsguide.com/short-straddle.aspx

Iron Condor and Iron Butterflies

These strategies profit from neutral or mostly neutral stock movement. They receive a credit to open and benefit from theta decay. If your stock is range bound, these may be a good choice.
These are both 4 "legged" trades, so you will have 4 trading fees to enter or exit the trade. A lower cost or zero cost broker shines here. However, “bad” free brokers will give you poor fills, which may not be worth the discount.
Condors and butterflies have "wings" which are your purchased puts and calls. The wider the wing the higher the max profit/risk. The condor body can be riskier and skinny with a narrow high profit range or wider for a much greater chance of success with lower payout.
An iron condor is built by combining a put credit spread and a call credit spread with the same expiry.
An iron condor can be thought of as a modified short strangle with limited risk, and therefore a bit less profit. I prefer defined limited risk.
The butterfly is similar except instead of a plateau it has a sharp peak. My personal mental note is that a condor looks more like a strangle with wings, while a butterfly looks like a straddle with wings.
Pay attention to earnings dates when you open these, I have forgotten to check before and it led to bad trades.
https://www.theoptionsguide.com/iron-condor.aspx
https://www.theoptionsguide.com/iron-butterfly.aspx

Long Condor (Debit Call Condor)

The debit version of an Iron Condor. You expect the price to stay inside your defined range. This strategy profits from neutral or mostly neutral stock movement. I’ve never tried this, Iron Condors make more sense to me.
Limited risk / limited reward.
https://www.theoptionsguide.com/condor.aspx

Short Condor (Credit Call Condor)

Inverse of an Iron Condor. You expect the price to go OUTSIDE your defined range. These are useful when you expect significant price movement. Credit to open.
Limited risk / limited reward.
Can be harder to set up. I want to try these, haven’t yet.
https://www.theoptionsguide.com/short-condor.aspx

Reverse Iron Condor

Inverse of an Iron Condor. You expect the price to go OUTSIDE your defined range. These are useful when you expect significant price movement. Debit to open.
Limited risk / limited reward.
https://www.theoptionsguide.com/reverse-iron-condor.aspx

LEAPs

LEAP Options are options that are long term with many DTE, often over a year until expiration. LEAP calls are great for long term growth plays (downtrends with LEAP puts) or simply when you really like a company and can't afford 100 shares. LEAPs (or any "longer term" option) enables you to sell a PMCC or PMCP (below)

PMCC / PMCP

PMCC or PMCP are poor man's covered call (or poor man's covered puts). They are diagonal options often used with purchased LEAPs. You sell a shorter DTE call/put with a further OTM strike than your purchased call/put. For PMCC/PMCPs it is often recommended to recoup your extrinsic value as soon as possible, some recommend with your first call CC or put sale, to ensure you are positive if the option is assigned early. These have a lot of moving parts and strategies. If you buy a barely ITM call/put and sell a nearby strike call/put you run the risk of the purchased option getting "blown by" on large stock movement and ending up with a very negative losing trade. Keeping your purchased LEAP deeper ITM should protect you. Check your initial PMCC using an options calculation to make sure you don't screw up.
I'm currently tinkering with these myself. So far I like .7-.9 delta call LEAPS with 30-45 DTE calls on my CC. The goal is to hold the LEAP long term, potentially until expiration, and constantly sell calls/puts on it that expire worthless. Typically the call/put is rolled up and out or down and out if it's going to be assigned, unless you don't want your LEAP anymore.
Some people look at these many sold CC or puts as profits, I look at them as lowering my cost basis until it's zero (or even negative). I have a page in my notebook I write each CC on my NIO LEAP (I Meme stock sometimes). I find it satisfying to slowly see the cost of the original option disappear. When I originally wrote this I had ~2 years left on it and it's 9-10% paid for; that doesn't even count the actual gains the LEAP has.
TT states this is considered an IV play, which I partially agree with. You want to buy these during low IV times since an IV drop will hurt your LEAP value. I look at them more as a way to sell calls/puts on a high IV company with a lot of price movement and potential upside/downside.

Advanced Orders

Guide to several order types: https://us.etrade.com/knowledge/events/webinars/order-types-from-basic-to-advanced-07162019
One Triggers Other (OTO):
- Good brokers will allow you to set these up, some will require a desktop to do it. This lets you link one action to another. In programming think of it like an if-then. You’ll tie a buy/sell to another buy/sell
- Setting trailing stops on options is very chaotic since their price movement can be drastic due to volatility. I prefer to set my trailing stop to a stock.
- What I like to do is set a trailing stop on a stock (or just link it to a stock price drop) and have it sell 1 share I own. Then it immediately executes a market order to sell my call. I’ve had good luck doing this with incredibly volatile plays were stop losses aren’t effective. I’ll often have an order saved and ready saved for when a strong run up starts. When my price alerts start blowing up my phone, I’ll immediately hit execute to turn it on.

Disclaimer:
I’m not a financial adviser, I'm actually an engineer. I’m not telling you to invest in a specific stock/option or even use a specific strategy. I’ve outlined and more extensively elaborated on what I personally like. You should test several strategies and find what works best for you.
I'm just a guy who trades (mainly options) part-time for financial gain and fun. I don't claim to be some investing savant.

GSA Tells Biden That Transition to Presidency Can Finally Begin, r/politics and r/news Reacts™ and Over a Thousand Comments Get Removed as a Result

WHY CANNABIS MARKET FOR 2021

The cannabis market right now is so similar to the start of the green energy market.. its nowhere near done being bullish. Save for some small dips, there will very likely be a huge bullish trend for 2021. EVEN NASDAQ AGREES. I’ve posted my positions a few times, and I’ll continue to do so. But this is my reasoning for investing in cannabis stocks in general for 2021.

I've been a bull on cannabis since the democrats had a strong pro-cannabis platform. But what made me go balls deep into the market was that the UN changed its classification of cannabis. Countries follow the UN closely for guidance on their own classification of controlled substances. Congress has repeatedly cited the UN’s classification as one of the reasons for not changing it. Several countries immediately changed their stance on cannabis in response to this, including Israel, which In November 2020, announced that it was moving forward with a plan to legalize recreational cannabis nationally. “The country is aiming to implement recreational legalization within nine months, and even if there are delays, that means mid-to-late 2021.” (This is my reason for investing in Canadian cannabis companies, because they are already poised to expand internationally since its legal there nationwide)

THE SENATE IS NOW BLUE! The Georgia runoffs were won by Democrats, and they can now swing the vote left with VP Harris. She promised it as part of her platform, so we know it will be prioritized. CHUCK SHUMER SPONSORED THE MORE ACT. HE WILL BE SENATE MAJORITY LEADER. IT WILL 100% BE PRIORITIZED BETWEEN HIM AND VP HARRIS.

EVERYONE predicted beforehand that the republicans would win Georgia... everyone talked down decriminalization passing the house because of they believed it would NEVER pass the republican majority senate. But the left spent more than any senate race in history to encourage voters to go out and vote. Only once the race started did it become clear that the left had a chance. Then some gains from the surprise that they won. However the gains from 1/5 onwards definitely hasn’t been priced in for all the future legislation, because some of it will be completely new legislation that wasn’t possible to consider before without a blue senate. THIS HASN'T BEEN PRICED INTO THE MARKET YET.

The SAFE BANKING ACT has bipartisan support, and is likely to pass BEFORE decriminalization because it is tied into some stimulus bills.

The government is broke post-COVID. There is a terrible image of the police. They don’t want to waste more resources on cannabis related crimes that would be fixed under decriminalization. And the tax revenue from decriminalization would be significant. Decriminalization (THE MORE ACT) opens up the borders to interstate-commerce and international import/export. This would all trickle down into Uncle Sam’s empty pockets.

New York Governor Cuomo announced on Jan 6 his plan to legalize marijuana for adult use (right after New Jersey vote, as I anticipated in my last post) as part of his State of the State agenda. The next step is a ripple out on the North East. NY didn’t want to miss out on tax revenue, neither will any of the other states in the northeast within driving distance of NJ and NY. This is Cuomo’s third attempt in three years to legalize adult-use cannabis in the state; last year, Cuomo included a legalization proposal in his state budget, but the plan was ultimately cut in the wake of the COVID-19 pandemic.

Other ongoing state legislature:

Rhode Island: Regulators have received 45 applications for six new medical cannabis dispensary licenses in the state. If all applicants meet the requirements for a license, six will randomly be selected in a lottery to operate retail locations in different regions across the state. Read more
Missouri: Rep. Shamed Dogan has filed legislation that would place an adult-use cannabis legalization measure on the state’s 2022 ballot. Meanwhile, Missourians for a New Approach has announced plans for a separate 2022 ballot initiative after an unsuccessful signature campaign to get the issue before voters in 2020. Read more
Alabama: Sen. Tim Melson plans to reintroduce a medical cannabis legalization bill this year. Medical cannabis legislation passed the Alabama Senate during the 2020 session, but failed to clear the House. Read more
Illinois: Illinois lawmakers have proposed the creation of 75 new cannabis retail licenses to give disadvantaged and minority applicants a second chance at licensing following the controversial licensing lottery to issue an initial 75 dispensary licenses. A work group made up of lawmakers and members of Gov. J.B. Pritzker’s administration met this week to finalize details of the bill, which will be introduced in a lame-duck session that starts Jan. 8, before new lawmakers are sworn in Jan. 13. Read more
Minnesota: House Majority Leader Ryan Winkler is again renewing his push to legalize adult-use cannabis in the state, announcing plans to reintroduce a legalization bill this year. Winkler told WCCO that he sees “Senate leadership as being the number one obstacle,” but said that if lawmakers agreed to place an adult-use legalization initiative on Minnesota’s 2022 ballot, “it would pass overwhelmingly.” Read more
Virginia: Del. Steve Heretick has reintroduced a bill to legalize adult-use cannabis. Heretick has proposed legislation related to decriminalization and legalization in the past, and this year’s bill would legalize the cultivation, sale and consumption of cannabis in the state. Read more
Connecticut: Gov. Ned Lamont renewed his push for adult-use legalization during his State of the State address Jan. 6, announcing that it is a priority for the new legislative session. Connecticut’s 2021 legislative session opened Jan. 6, and Lamont, a Democrat, kicks off the session with increased majorities in the House and Senate, which could increase his chances of passing an adult-use legalization bill. Read more

Now that you understand why I’m going green, here’s my reasoning for my positions.
TLRY (Tilray)

largest cannabis company in the world by revenue post merger. Will run out of Seattle and New York City. New York Legalization on top of senate turning blue is a big catalyst for TLRY.
Merger hasn’t completed yet, and the merger happened before the senate went blue.. that was the gamble APHA was making, and they won. The sky is the limit now. When they merge, they will reduce expenses and be much more likely to post profitable quarters. (This is why mergers have so much hype; the sum is > than their parts because they can reduce operating expenses while maintaining revenue from the two companies)
Tilray CEO Brendan Kennedy: “I think medical cannabis will be legal at the federal level, which means medical cannabis can cross state lines and be imported into the U.S., like we export cannabis from Canada and Portugal to about 15 countries now,” Kennedy said. “Anyone who thinks there’s a state-specific medical market is wrong.” As for the recreational market, Kennedy says the state-specific markets, with interstate trade banned, “are not going to last long.” Kennedy believes that cannabis will be distributed like alcohol and tobacco within two years’ time. That would require significant overhaul of US federal drug laws—and would significantly disrupt all US cannabis companies’ existing business models. Brendan Kennedy, the cannabis billionaire will step down as Tilray's chairman and CEO. Irwin D. Simon, Aphria's current chairman and CEO will take Kennedy's place.
[On December 18, 2020, just three days after the U.S. Senate adopted the Cannabidiol and Marihuana Research Expansion Act (CMREA or the Act) (more on this below), the U.S. Drug Enforcement Administration (DEA or the Administration) published in the Federal Register a final rule, “Controls To Enhance the Cultivation of Marihuana for Research in the United States” (Rule), which finally paves the way for DEA to issue additional licenses to grow “marihuana” (i.e., cannabis) for research purposes.](https://www.jdsupra.com/legalnews/on-heels-of-senate-s-adoption-of-36129/)

GNLN (Greenlane Holdings)

One of the largest global sellers of premium cannabis accessories. Pax/JUUL/Volcano products. I’ve had Pax products, and although I prefer Arizer because of the affordability, I can’t deny Pax has quality products and is like the “iPhone” of vaporizers. I like their products, I like their branding. There’s lots of hype and loyalty, especially with their Volcano desktop vaporizer.
Strong US brands.
The main reason they did poorly was bad timing. They IPO’d during the year that JUULs started being banned. They’re actually at all those levels again. Theres a ton of upside potential.
Market cap is ridiculously low for some really renown brands all because of the JUUL flavor pod ban. Everyone knows Pax, Volcano, and JUUL. But no one knows Greenlane because of the bad timing of their IPO and the subsequent JUUL flavor ban. It’s crazy. They’ve already broke all time high for the year. But I’m holding until they break 1B market cap.
Recently became the exclusive distributor for the world's first gravity powered contactless water hookah.
Overall i think too many people count it out just because of their IPO and subsequent decline in JUUL sales from the JUUL flavored pods ban. They definitely have the potential because of their strong branding and quality products. I’m betting on them having more high quality products in the future with equally loyal customers.

SNDL (Sundial Growers)

SNDL must close above $1 per share for 10 consecutive sessions by June 26, 2021 or it will be delisted from NASDAQ. People see this as a fear factor, I see this as “they will do anything necessary to reach $1 for a week so they won’t be delisted”.. IMHO reverse splitter probably isn’t on the table since they could have done that in 2020, but instead applied for a 6 month extension after announcing “alternative strategic investments”. We can already see this by their predatory loan SPAC spinoff.
Rumors of a merger with CGC; SNDL also purchased a SPAC recently and entered an agreement with Zenabis, immediately claiming they defaulted. Turning that SPAC into predatory loan/debt repurchasing company. Imo if they want to complete a merger, it would be easy to sell ownership through that SPAC to the buyer.
THEY RECENTLY WENT DEBT FREE by selling off unprofitable assets in the business. This means we are much more likely to see earnings in future quarters, and they are much more attractive for mergers.
Because they are indoor growers, they are more likely to be bought up by a company in the consolidating Canadian cannabis market than fail all together. The amount of space licensed to grow cannabis in Canada is now heavily skewed toward outdoor cultivation instead of indoor for the first time, according to new data from Health Canada. A growing population of licenses for outdoor growers means that there aren’t as many indoor licenses being given out... If a company ANYWHERE IN THE WORLD wants to quickly expand into indoor growing OR into the west, they would have to purchase an existing company that has the license to quickly do so. This is WAY faster, and a guaranteed way to obtain a license rather than applying for one and waiting x amount of months and be rejected for some requirement that wasn’t met.
From my own experience, outdoor cannabis is subpar quality to indoor grown cannabis. So a growing market for outdoor cannabis doesn’t necessarily mean its better... it is likely just cheaper. I would imagine a high quality “craft cannabis” company would want to purchase SNDL, or an existing outdoor growing company that wants to quickly expand to indoor grown cannabis. With this being a Canadian company, there’s a chance a company in another country like Israel would be interested in purchasing it in the near future.

PLNHF (Planet 13 Holdings)

Biggest tourist trap in Las Vegas if you’re a stoner, casual smoker, or just wanting to try it. From my own experience, I think they will continue to be successful. If I went around the US trying other brands I’d probably be more confident in putting 5-10% of my portfolio into those picks or choosing to not include them lol. Like for example, I used to have Curaleaf. But there's tons of bad feedback on Curaleaf, a friend has tried it said the nug is really subpar quality and if I tried their nug I’d probably confirm that I wouldn’t want to invest in them. With PLNHF, i’ve seen the ambience and tried the product myself. It’s definitely a lot of hype price wise, but still quality. This is my own bias showing, but I still think they’ve got solid fundamentals and excellent location/strong US branding.

I’m well aware of other good stocks like GTBIF, CRLBF, SSPK, TCNNF, GRWG.. but these stocks haven’t been swinging as hard in response to pro-cannabis news. E.g. TLRY, SNDL, GNLN swung more than 20% some days from pro-cannabis news...I will likely reduce my current positions shortly after inauguration, after some news about the timeline for cannabis legislation, and diversify my positions more between these other good picks.

2021 is the year of cannabis boys

Sharing my NEXT best stock pick of 2021

To those of you who got in on ARB at 55p, over a month ago, you would be up 53% from today's closing bell (117p). To those who bought near the peak at 135p, you may be relieved to know I am still holding. Q1 and Q2 of 2021 should be their best performing months (based on recent RNS updates), so there is still plenty of growth to be had. With the incoming catalysts, I have a conservative estimate of 200p and 600p by Dec 2021.
I did a quick search on Reddit and Youtube and was impressed to see that there is little to no mention of this NEXT stock that I am about to present. Meaning that for those of you who do decide to invest, you are getting in super early!! I wouldn't be surprised if these fraudsters on Youtube start mentioning it as part of their "DD" in the coming months.
I'm still holding 8 stocks, but have recently swapped out some old stocks and now have some new ones, one of which is:
KR1 PLC
Who are they? KR1 is like VC on speed. Founded 2016 as KRYPTONITE1, they are a pioneer in the EU digital asset investment space, supporting early-stage blockchain and DeFi projects. Listed as the following: KR1:AQSE. This exchange is actually a huge advantage - in terms of price and being undervalued - more on this later. KR1 (unlike arb) is not a miner, they are focused on investing in smart-contract/token economies, especially those relying on a ‘Proof-of-Stake' network that, unlike 'Proof-of-Work' networks, such as Bitcoin, do not require enormous computing power & energy consumption to guarantee the security & censorship-resistance of the network’ (per recent Kusama RNS). Proof of stake now looks set to be a dominant blockchain technology – esp. with Ethereum 2.0 ready to go live. Also, if you’ve read about/had a friend lecture you about Bitcoin energy consumption eating the world, then KR1’s a genuine green/ESG crypto investment for you (& your friend) to consider.
KR1 PLC Chart
The operational progress of the KR1 team has been nothing short of extraordinary, for a view of their investments to date, see: KR1 Holdings
Market Cap: $117 million (vs a $130 million portfolio) - that generates $10.25 million pa in staking profits.
Main Portfolio Value comprises: (DOT: £58.77mm, LDO: £30.05mm, ATOM: £12.41mm, WNXM: £4.24mm, KSM: £3.75mm, DFN: £3.28mm, ETH: £2.49mm, RPL: £1.03mm)
For anyone who wants to see the level 2 data, this can be found here.
My main investment thesis is that existing trends with cryptocurrency and blockchain will accelerate at exponential levels in 2021. Some quick highlights from this year are: 1) Elon Musk adding 1.5 Billion BTC to Tesla's Balance Sheet. This is > 10% of their cash position. Wow!! We’ve even seen listed companies like MicroStrategy & Square (Jack Dorsey) buy Bitcoin as a corporate treasury asset in the past. Like it or not, other CEOs will follow suit in diversifying their assets. While writing this I've also read that Apple are considering to follow TESLA in buying Bitcoin. This is a positive trend, and trends are super important in investing. 2) Long term macro still incredibly positive for bitcoin imo, evident by the fact that grayscale has been buying more BTC than is created. We know a wall of money is coming from family offices, hedge funds, pension funds, corporate treasuries etc; and 3) The whole fiasco with RobinHood and Citadel. Whether or not you believe there was some conspiracy between them (for which I do not), the key takeaway is this: People are losing faith in central exchanges and centralised finance in general. Decentralised Finance (Defi) is moving forwards at an exponential rate and I think it would be silly not to have some exposure to this. I also want to add that crypto is a great hedge from inflation or stagflation if you have a huge expansion in money supply, but households arent spending and only save, added with stricter fiscal policies such as taxes, welfare etc.
Summary of 2020 from KR1.
Expanding on some of their holdings listed above:
The diversity & number of investments in KR1’s portfolio is quite unique – globally, maybe a handful of crypto VC/hedge funds come close, while listed crypto & blockchain portfolios aren’t remotely as diversified. Polkadot (DOT) is a digital infrastructure project. Created by the co-founder of Ethereum. Great interview by Gavin Wood here where he explains Ethereum's fees and how Polkadot makes this much quicker and cheaper. $DOT outperformed $BTC today which is a very bullish signal. I see DOT going to $30. Just look at their Cosmos ($ATOM) holding from the weekend gone, KR1 is holding more than $16.5million!!! KR1 has also invested a total of US$150,000 in return for 15mln tokens in the Lido project. Last time I checked KR1's 15mln Lido was worth $40million. Reference has been made to holdings in BTC and ETH, thus, this has yet to be priced in. From day one, KR1 eschewed Bitcoin & focused on seed/early-stage investment in token economies/blockchain projects. Because Bitcoin’s ultimately a bet on price while investing in blockchain is a bet on innovation! Innovation will win 10x over and that's why I am invested in KR1 vs BTC directly.
Valuation:
KR1 is at NAV discount because it is a small illiquid stock on a difficult to buy exchange. This will soon change however with a higher market cap, a move to better exchanges, and public acceptance and understanding of what Defi is.
With 131million shares that equates to 90p per share. Including the 60p for the staking valuation at PEx10 that equates to £1.50 per share, or £2.10 per share using PEx20.
In short, I think KR1 is a great undervalued stock as their SP does not reflect the true value yet. KR1 is not a BTC/ETH play, it's a diversified portfolio of 4 dozen crypto projects. The main reason KR1's SP does not track the true NAV is that the BOD still does not provide a detailed portfolio breakdown (by units & value), or a regular NAV update – except via its results, months later!
Aquis Stock Exchange Listing:
KR1 is listed on the Aquis Stock Exchange (formerly, NEX), hence why more investors haven’t discovered & bought the stock. So how do I buy KR1 you ask? I personally use Hargreaves Lansdown and buy it over the phone using this number: 0117 980 9800
List of brokers where you can buy online: Barclays, Davy, DKB, Eqi, ING Diba, S Broker, Share Centre, Swissquote, x-o.
List of brokers where you can buy over the phone: HL (I use these), Barclays, C Stanley, Canaccord, Davy, DKB, Eqi, Goodbody, IG, Interactive Investor, ING Diba, Pareto, S Broker, Share Centre, Swissquote, x-o.
^{Note: If I have missed any off this list, please let me know in the comments and I can update.}
AJ Bell and T212 are currently reviewing telephone options.
And yes, this should work for non-UK clients & brokers – KR1 settles via CREST, just like any LSE share. If you’re a UK investor, make sure you buy via a tax-free ISA.
Ultimately, an up-listing is the solution…i.e. an AIM:LSE listing, and/or even a US OTC listing, could deliver a drastic valuation re-rating.
Price Target: 150p/share (PEx10) OR 210p/share (PEx20)
My largest holdings are ARB and KR1. Full disclosure, I own 10,000 shares of KR1 @ 41p.
Just to finish, I am not advising anyone to buy this stock. I am not a financial advisor. You have to do your own research. Just wanted to share (in my opinion) a really good stock that I am long-on.

I just took 2nd in a main event and won $118,422. Now what do I do?

do bet winnings get taxed video

Let me give the example of the country I live one. You bet a -110 odd. lets say you bet 110 to win 100 If you lose the sportsbook will keep the extra $10 for them that is their juice. Of course, Gambling winnings are also taxed. You must report game show winnings, and you will receive an IRS Form 1099--just in case you forget to put your win on your tax return. For many of us, gambling means buying the occasional lottery ticket on the way home from work, but the Internal Revenue Service says that casual gambling also includes raffles, casino games, poker, sports betting—and, yes, even fantasy football. When you win, your winnings are taxable income, subject to its own tax rules. How Casino Winnings Are Taxed. As stated earlier, the federal government levy tax on both cash and non-cash winnings. Returns gotten from wagers placed on bingo, keno, lottery, raffles, sweepstakes and slots including non-cash winnings like trips and vehicles are taxable. It is the Fair Market Value (FMV) of non-cash winnings that are taxed. If you receive your winnings through PayPal, the reporting form may be a 1099-K. The 1099 tax forms report your winnings to the taxing authorities and also gives you notice of the amount you must report on your taxes. Even if you don't receive a 1099 form, you must still report the net profits on your federal and state income tax returns. If your losses exceed your winnings, the amount you deduct cannot exceed the total amount of your winnings. Keep records of the gambling losses you claim on your tax return. You can do this by keeping a gambling log or hanging onto losing bet tickets, lottery tickets, and bingo cards. Don’t worry about knowing these tax rules. The IRS doesn’t mention sports betting on its website, but these do count as gambling winnings. Any cash winnings or prizes (such as vehicles or vacations) also count, assessed at their “fair market value.” When it comes to pure winnings from betting, however, that quite simply is not the case. As we have discussed above these winnings are not taxable and this remains true even for a ‘professional gambler’. That is because HMRC do not recognise professional gambling as a taxable trade. To do this, the establishment will issue IRS Form W-2G, Certain Gambling Winnings. According to the form’s instructions, the payer of gambling winnings must issue this form to you if you receive: If you win big while gambling in Las Vegas or Reno, you do not get to keep every penny, alas. Gambling winnings are taxable, and the Internal Revenue Service (IRS) wants its share of your casino loot.

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Paying Tax on Sports Betting: Here's What You Need to Know

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do bet winnings get taxed - win

Meme stock post-mortem

GME - EndGame Part 2: Cohen, Market Cap, Potential Investors

Quick aside - my history and positions:

About Cohen (and friends)

Cohen is not an exec - he’s a founder with an all-in mentality

What will lead to Cohen’s next purchase of GME

GME’s market cap potential

Potential Investors

A message to the Short Bus

Salt Lake City Baseball - 1958 (Year 4)

1957 Recap

The Offseason

Free Agency

Opening Day

The Draft

International Signing Period

All-Star Break

End of Season

Achievement Unlocked: Thetagang For Life

Sports Betting Tax Advice from my CPA

I wrote a long reply on why gambling, and loot boxes in particular, are bad...

My Options Overview / Guide (V2)

GSA Tells Biden That Transition to Presidency Can Finally Begin, r/politics and r/news Reacts™ and Over a Thousand Comments Get Removed as a Result

politics

Chapter 1

Chapter 2

Chapter 3

Chapter 4: COMMUNISM SCHOMMUNISM

And just like that, an election was stolen and our Republic has begun its decline to communism. Trump was the last hope and even he doesn't have a backbone it seems.

"You have no idea what communism even is. Holy shit."

"The distribution of wealth. Aka, welfare, ubi, and ultimately economic failure"

CODA/POST-CREDITS

news

Passage 1

Passage 2