Come On Volatility

I’ve always been fascinated by the concept of “volatility.”

When I say “always,” I don’t really mean “always,” but for at least the past decade or maybe a bit more.

Volatility is one of these things that is really hard to comprehend, even though it really shouldn’t be, even as it is applied to stocks and stock markets.

Volatility is nothing more than what is defined by an equation.

Even if that equation may be a complicated one, there is something that should be comforting about the certainty of it and its calculation. There is no art to it.

It is all about science.

Subjectivity versus objectivity.

Emotion versus cold, hard facts.

Volatility is simply the result of an equation that measures “variance,” which as everyone who has taken an elementary course in statistics or bio-statistics knows as being itself related to the more commonly recognized expression: Standard Deviation.

Who am I kidding? No one recognizes that expression, or if they do, it’s been misinterpreted when I’ve used it sitting at an out of town bar, trying to strike up casual conversation with someone far younger and far more attractive than me.

Anyway, there is lots of confusion over what volatility represents and I’m confused by it, as well, even as I think that I understand it.

The confusion really enters once a marketplace for volatility had come into being.

The equation, which should be primary, is now more of a junior consultant.

Continue reading at Seeking Alpha

 

 

 

A New Someday Began Today

Image result for whewWhew.

What a week.

There are lots of statistics and factoids being tossed around this week.

Every one of them is pretty fascinating and each one lasts in the apses of my mind for about a second.

None of them are very important and none of them are worth remembering, because there is very little in life that isn’t transient.

Just when you think yu’ve seen the depths comes something lower and just when you think you have found paradise, somes a realization that it can then never get better.

But it does,

So the very old phrase “This too, shall pass,” has lots of meaning. Continue reading “A New Someday Began Today”

It Could Have Been Worse

Perspective means so much.

On days like today things could have been much worse.

For me, as an option seller, it is always a case of balancing the fear of missing out (“FOMO”) with the need to have protection.

Sort of like balancing out missing the joys of fatherhood with fatherhood.

As long as we’re talking about me, my decisions are usually predicated on what I perceive as a simple mathematical truism.

I’d rather miss out on a 10% gain than have to gain 11% to make up for a 10% loss.

That may not really answer the question, but in the longer term, even as my perspective on what constitutes “long term” changes, I would rather miss out on some gains than have a deeper hole than a care to dig out from.

But also knowing that in the longer term the market goes higher, it typically is a question of just keeping your capital and your wits. Continue reading “It Could Have Been Worse”

Cash

About 5 or 6 years ago, I wrote an article called “What Would Cash Do?

The photo to the left is the one time that the Seeking Alpha editors didn’t let me get my way.

I was reminded about it the other day when someone asked a question on a closed Facebook page about what artist do you hear and then remember what a badass he was?

For me, the answer was easy.

It was Johnny Cash.

But it also reminded me of what I’m up to right now in preparation for things to come. Continue reading “Cash”

LEAPS?

Why LEAPS?

After more than a decade of getting a serious level of excitement by simply making a trade, even if the net profit per share was a penny or two, I always knew that someday I wouldn’t be able to sustain the kind of maintenance that it took to keep on an eye on a portfolio.

Even worse, I knew that someday I wouldn’t have the kind of time and attention that it took to keep an eye on multiple portfolios, especially when those portfolios may have had different goals and tolerances for risk.

Like most people, I always looked at investing and investment philosophy as being on a continuum. Continue reading “LEAPS?”

A Natural Corollary

A natural corollary to the concept of collecting crumbs, is what I used to call (and still do),  the “D’oh Trade.”

That article, in a highly edited version appeared in TheStreet.com, but the unedited version appeared in the old OTP website.

I thought that writing for TheStreet would be a great way to get followers, but I found that I preferred to write without an editor more than I wanted the followers.

But, here, it is  

Run-on sentences and all.

I’ve spent a lot of time in 2017 making those D’oh trades and those crumbs have really added up, although sometimes they do take a lot of maintenance, as well, as I look at the possibility of losing Petrobras this week at an $8.50 strike and possibly an early assignment of Abercrombie and Fitch as it goes ex-dividend, this week.

But if you own those shares and have been following those trades, stay tuned.

Welcome Back Old Friends

JImage result for welcome backust a couple of weeks ago, actually not even that long ago, I bid a farewell to an old friend, whose name I always had difficulty in spelling.

That was Weyerhaueser.

Today, along with LuLuLemon, I welcomed it back.

In my ideal world, at least when it comes to stocks, that is what I would be doing again and again.

A couple of years ago it was that way with Twitter. Continue reading “Welcome Back Old Friends”

Goodye, Undistinguished Friend

Sometimes, when you take a superficial look at things, you really don’t see the beauty.

I have to admit that while I’m not a real glossy person in life and while I’ve never been one to look for thrills or seek to stand out, I do like stocks that have character.

In a perverse way, I think that I may even like stocks that treat me poorly.

There is probably a name for that sort of thing and there is probably a diagnosis that goes along with the propensity to get some joy out of misfortune.

In case you don’t know the term, it is Schadenfreude.

This week, though, it was a different Germanic word that came to mind, as I marked the end of an almost 2 year association with the shares of Weyerhaeuser.

During that time, I never really even learned how to spell its name without having to look it up, even as “Schadenfreude” comes as second nature. Continue reading “Goodye, Undistinguished Friend”

Not a Gold Bug

Image result for gold bugI am definitely not a gold bug.

I definitely do hate bugs, though and I do like gold.

With the latter, only in moderation, but I’m liking gold more and more.

For each of my son’s college graduations they received some one ounce gold coins, representing the first time I had ever purchased gold in any form, other than jewelry.

Those turned out to have been good investments and some of those coins have already been cashed in and turned into other good investments.

But what I have really come to enjoy have been the gold miners. Continue reading “Not a Gold Bug”