Board 8 > Stock Topic 9

(+) Yeah! (+)

You know who has played a stock perfectly so far

Me and TRVN. Sold at the pop for FDA (slightly late) and rebought in at about the low point.

Join my cult now. Today is your last chance!

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Should I buy more Tavern stock?

Ultimately it's only if you're comfortable with it. I will say I expect it to be at around $2.50 minimum on just Monday and I think it's a very safe bet to get to its pre-FDA maximum (~$3) in the fairly near future. The offering closing is not going to send it down, so if you can get shares close to $2.30 it'll be very low stress for you.

I expect a decent little spike when the offering closes though. I would sell any extra you add then to get some cheap profits, and keep what you already have a bit longer.

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It's quite tempting to buy some AVCT now. The price is almost back to where it was before that pop from the Kandy buyout announcement.

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Yeah AVCT closed at 4.80 that day. And since I don't think there will be actually be any dilution coming I don't think you can go wrong here. Might bleed out below 5 next week if there's still no PR and guidance plans, but you're set long term.

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Apple stock split

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I won't be able to resist AVCT if it gets below $4 again. Below $5 I'll consider it.

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Sandstorm's account today from the AVCT discord :O

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StartTheMachine posted...

Sandstorm's account today from the AVCT discord :O

I'm surprised he's able to sleep through market open with that kind of money on the line.

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He's a super long with great averages on the warrants and commons and I guess he figures he'll be fine in the long run. I couldn't handle that shit at all though. Especially again because dude isn't even a millionaire right now and hasn't sold anything, just accumulated low.

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I should've waited to buy back into AVCT. Already eating a 25% loss on that.

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Yeah i will say if you are under 8 you are fine long term tbh. I bought back in! Wishing I had been a bit more aggressive with aal but just shrugging, long term there too

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He could literally have 6 million if he sold his warrants before market open last Thursday and now reinvest 3 million today to get the same number of warrants with 3 mil guaranteed in the bank.

Way smarter way of trading and still going long on a company

E: Oh that's only 21% of his account value. Sounds like he sold other warrants he was holding so he does have a shitton of money now. Well he's still somewhat smart I guess and he trusts AVCT the most to go long in.

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Sold all my avct this morning at $5.37

Looks like that was a good decision. I'll buy back in if it keeps going lower, but it feels a little too culty in here for my taste

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I believe in the cloud cult but I don't really have a choice

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Sorry bro

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I feel like I threw an interception on 4th down for the game winning score at the end of the Super Bowl

I was right there :( This was the only play that I cared about. Once AVCT took off before I could accumulate more shares as was always my plan my heart was already out of it. If they announced the acquisition literally a day later I'd be at over 100k.

I will be sad and likely not trading for a while but oh well. My stock market ambitions have consumed me anyway and I could use another bagholding break. Hope everyone has fun and makes lots of money in the mean time.

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Blur, I think the reality is with the hyper aggressive strategy you were using, this was inevitable. Whether it happened when you got to 60k or 100k or 500k or 1M, it would have happened eventually as long as you took on this kind of risk. I'll tell you though that I don't believe you would have stopped trading so aggressively if you had gotten your 100k. If you can turn 10k into 100k, you can turn 100k into 1 million right?

Let me repeat that I am not saying you should limit variance by closing out positions quickly (whether profitable or unprofitable). Jumping back and forth between cash and stocks doesn't make money unless you can actually time te market, which is incredibly hard. Limiting risk means choosing positions that don't have ridiculously high variance at the time you open them.

The thing you did that blew the variance into the stratosphere here was exchanging your shares for warrants. If the risk level of buying a stock is like driving to the store in your hometown, a deep OTM call option or warrant is like sailing a raft across the Pacific Ocean.

The mathematics of it is that with very high variance positions, one moderate drawdown will erase all previous gains, even if they are massive. It's tempting to think to yourself that a drawdown was severe, or exceptionally unlucky, but with the variance level you were using, what you ran into was a completely normal. In fact, it was more likely than not to happen! For a call option to decline by 50% is more likely than for it to increase by 50%. Why? Because the most it can go down is 100%, but it can go up thousands of percent. So the probability of going down has to be greater than up, or else everyone would buy the call option. And the price would rise until it was no longer an obvious bargain.

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Man, once I hit 5 figures my entire trading strategy from there was to play very safe stocks with the majority of my portfolio (I knew I was going to throw a lot at Apple but would have to do a ton of research to figure out what else might have the most upside) and leave about 30% for SPAC warrants with the 20-50x potential where insane amounts of research is pivotal. (If anyone here actually does research and doesn't just trade on recommendations do some DD on MFAC - that's my next call). I know you think that my mindset would stay the same but if I 10xed my money, I know I could still lose it with dumb trades; I am very self-aware of this. It's why I continually laugh at myself for betting on GNUS and getting lucky to even have this money to play with. Trust me, the higher those numbers go the more fearful I get. AVCT was never blind faith for me -- okay, it started that way and then I saw the potential. I'm grateful for it because it has completely changed how I trade.

Also I'm still comfortable with these warrants long-term or I would never have bought them high, though I admit that buy was still me being emotional and somewhat revenge trading hoping for a good ER, since I decided not to sell and short that morning. But nonetheless I don't impulse trade anymore and before I take any position I still ask myself if I'd be comfortable holding a year from now. That's a rule I established when I was fucking with and getting burned by penny stocks, buying on hype and no research.

I may be taking huge positions but I've been pretty damn methodical about this and it's not as impulsive as you may think. If AVCT was the huge trade I wanted it to be, honestly I would have gotten lucky because of that news and I wasn't sure I even expected that opportunity for 6 months to a year - I just have no interest in 30% gains when you can have way more than that with patience and knowing what you're investing in. And what do you know I'm still at 100% gains and am bagholding 15 grand.

I don't think warrants are near as risky as you make them out to be though if you don't blindly buy them. If you do - well yeah, that's just gambling. I'll definitely be trading them in the future. It's just a very different mentality that goes into trading them than commons.

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The number one thing I've learned is research means nothing if you still have a lack of discipline. Discipline would have been knowing there's nothing I can do to rewind time and make that buy order fill the day before that spike - arrogance made me not care how much I still made and only see what should have been. Hopefully I can completely clear that "if only" mentality from my brain and work with the trade I'm in at the moment. It's a lot of fighting natural human emotions for sure. I'll only get sharper the more I cut my ego out of my trades.

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If you get a 30% gain every 2 months, in a year that's a 383% gain. In 2 years it's 23x. In 3 years it's 112x. In 5 years it's 2620x. In 10 years it's more than 6.8 million x. If you start with $10,000 and get 30% gains every 2 months for 10 years, you end with over $68 billion.

Now let's run that again with a 10x gain every 2 months, except that 50% of the time, you lose 90%. From an EV point of view, this works out to an average gain of more than 400% in 2 months - more than 13x better than the 30% gains discussed above. So if we just use compound multiplying on 400% every 2 months, after 10 years we should multiply our money by 8.67x10^41. That's our EV. But wait, before we celebrate, let's look at our median return:

After 10 years, on average you'll hit an average of 30 drawdowns - that's 50%. And you'll hit 30 gains of 10x - also 50%. Your return with 30 drawdowns of -90% and 30 multiples of 10x is... ZERO! That's right, you end up where you started, with no gains at all.

Now, you ask, how can that be, when each trade, measured by EV, was more than 13 times better than the 30% every 2 months trades above, and those were enough to turn 10k into 68 billion? The answer is, with the 10x gain/90% loss strategy, almost all of that massive EV is locked up in the universes where you don't hit many drawdowns. For instance, if you hit your 10x 45 times and hit the -90% only 15 times, your gain is now 10^30. That turns an initial 10k investment into 10 decillion dollars, which is orders of magnitude greater than the total amount of wealth in the world. Practically, of course, by this point money is meaningless and there's no way you could continue making trades with such high EV by the time you are putting billions into each trade, much less decillions. And yet that 45/15 gain/loss world is still lower than the mean result which produced a gain of over 10^41.

In other words, with calls the variance is not a bug, it is a feature. But the greater the variance, the greater the disparity between the mean return and the median return. A trading strategy that can produce a 10x gain half the time and 90% loss half the time is obviously insanely profitable from an EV point of view. If you could do that people would pay billions to have you manage their money. But if you actually use this strategy, 50% of the time you won't make anything at all. Almost all the benefits of your research are locked up in the worlds where you accumulate more wealth than the entire planet.

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And note that this problem can be mostly solved with just a small amount of diversification. For instance, instead of putting all our money in the 10x gain/90% loss trade, let's allocate 50% to a 5x gain/90% loss trade, and the other 50% to another 5x gain/90% loss trade. EV is cut in half, but it's still insanely profitable. And now you are overwhelmingly likely to make money over a period of 10 years. The math is a bit harder to run as a back of the envelope calculation than I was thinking, but I'm pretty sure the conclusion is that the median result here turns you into one of the richest people on Earth (compared with zero gain in the other one). In the success universes, you go from owning multiple galaxy superclusters to owning a handful of planets.

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Also note that good portfolio allocation would have signaled to you to sell a significant amount of AVCT shares at $12. Why? If 50% was a good allocation for AVCT shares at $4 based on a price target of $20, then at $12 50% is no longer a good allocation. That's because your expected remaining gain from $12 to 20 is only 5/3x instead of 5x from $4. It'd be quite reasonable to cut the allocation from 50% down to say, 25%. So you sell half your shares. This is what Lopen does when his longshot stocks moon and it's generally a good strategy. It doesn't mean you are using money management gambling strategies (which don't work), it just means the situation has changed - the situation HAS in fact changed because the price went up.

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Any update on TRVN?

TRVN looking unimpressive at open. Hoping for a big spike throughout the day.

GAN volatility is super high

I recommend buying stock and selling $25 calls that expire Friday. They are selling for over a $1 a contract. Really good money

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TSLA, hello

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I refuse to buy TSLA

Fuck me and my arrogance

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Wow. Fuck TRVN. Way to disappear, Lopen.

Lesson learned, dont go into these random stocks without doing own research.

I was away camping and told you to sell if it hit 2.25 so figured you'd sold yesterday via stop loss.

I'm still holding and think it will be profitable by earnings in a week (and think it's a strong long play) but yeah always do your own research

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Also here's the thing I've learned with these cheap bio stocks.

They WILL randomly tank HARD for literally no reason. The funny thing is if it's for literally no reason (which you have to find by digging) they tend to go higher after that. I assume the guys with the big money do huge sells when they know something as a play to scare the small fish (me and even you) off of stocks.

As far as I know TRVN is dipping for literally no reason at the moment but again, was camping. I'll look into it today

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My 15 minutes of digging says that this is a dip based on literally nothing.

I'm holding with no concern. This is not a hold that needs news or anything to go up. Their product is in hand, they have no fear of going bankrupt before the product is produced. They have other products in the pipeline.

The only reason to have fear is if you think there isn't demand for a Morphine alternative. I see no reason this thing isn't at least doubling my money within a year though. If you want a short hold for a flip I still say hold until next Monday though.

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Now that I sold it I am sure it will go up soon.

If you want to listen to me you can't half listen. I gave you plenty of options that all would have panned out better than what you did.

Either stop loss sell at $2.25 or hold through 8/24 (or hold long). You do none of the above I take no responsibility for your losses. I'm not even blinking at this movement and I have a much higher percentage of my portfolio in it than you do I'm sure. (I hope)

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It opened under $2.25 and thats why it sold.

It dipped below $2.25 yesterday if you actually had a stop loss it would have sold then!

Of course if you actually did sell then...

You can always... buy back in

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Lmao. I refuse!

I wish I did. I could have 10% more shares. I've got no free funds to buy more though. Maybe TCDA will get their FDA approval in a few days (nice positive action past few days, I feel hopeful!) and I can shed my remaining shares when it moons to put them into TRVN.

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Random side note I feel like having those 10 shares of LK are an invaluable morale booster.

Literally all my owned stocks are net red right now other than it. I'm actually not doing that badly recently because some of those were buy back ins that I'm still green on but you know, interface psychology matters.

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Moonroof is half the reason I follow this topic.

I've never seen a more buy high sell low person in my life

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Actually I just realized I have a paycheck sitting at work I'm gonna pick up tomorrow can put a few hundred bucks from onto TRVN

Hope it stays dead till tomorrow. I will ADD TO MY POSITION.

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Ya go my DKNG

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Bought a few hundred of HCAC just to see if it does anything

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Have you considered some pton

Disclosure: dont own anymore

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I might buy an actual PTON but I dont know their business so no

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masterplum posted...

Moonroof is half the reason I follow this topic.

I've never seen a more buy high sell low person in my life

Haha. I am still up a few thousand overall!

https://gamefaqs.gamespot.com/boards/8-gamefaqs-contests/78919400