Monday, May 9, 2011

$35-40 range bound call vs puts bet May 21

Swish swash...we need Ben to save the day when QE2 ends and we go to $75.

34 comments:

  1. SGS,
    How is the guy doing who bet 1,000,000.00 and bought the 25.00 SLV puts. Has he sold or is he still in the game?

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  2. he cannot cash in unless it hits $25, at this point he is not doing so hot

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  3. SGS...not following you there....he can sell in the open market anytime, cannot he?

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  4. You finally decided to focus on the real manipulator of Silver SGS. Fuck Blythe, she's a capitalist and has played this market better than anyone you know. It's the Fed that has an interest in forcing the price of Silver down not JPM. They are nothing for than the Fed's straw. Forget their short book, I would bet anything they are long more Silver than you can imagine. Blythe has the best information the street. She knows days if not weeks before you do when to be long or short. Don't ake your eyes off the ball.

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  5. unless Im dead wrong, I am under the assumption it needs to hit his strike price of $25 before he can do anything with it... I wish it was like that if I could dump all my loser bets in the market Id be a millionaire!

    If it does not reach his strike, he losses his million.

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  6. I agree. This is paving the way for QE3.

    Way I see it...
    Big Bennie B is obviously caught between not being able to raise interest rates, and having the USDX crash through the floor.

    For the small cost of raising margin on silver, TPTB were able to have a silver crash cascade into a gold/oil pullback, which of course was accompanied by a rising USDX.

    This gives him the perfect backdrop of lower commodities -and thus the preceived risk of less inflation- so come the end of QE2 at the end of June, he can announce a 'temporary extention' (giggle giggle) of QE. Which will of course lead to $75 silver and beyond.

    Also...
    Why do you guys continue to enable Bankster precious metals suppression by trading on the COMEX? Do you think it will reform itself? Do you believe it will stop acting on behalf of Bullion Banks and its own Clearing members? Why not stick to phyzz, or for leverage, miners?

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  7. SGS...It is just an SLV Put, you can buy or sell them all day during market hours, no reason he could not cover, no need to wait for expiration.

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  8. IN RIDES THE WHITE KNIGHT.....

    Sprott Launches Physical Silver Mutual Fund, Will Likely Soak Up Much Marginal Silver Inventory

    "The Sprott Silver Bullion Fund is an innovative offering, being the first mutual fund in Canada to invest primarily in unencumbered, fully allocated silver bullion. The Fund's objective is to seek to provide a secure and liquid investment for investors seeking exposure to silver bullion without the inconvenience associated with direct investment." We can't wait to discover how many tons of silver this mutual fund will soak up imminently, and where the always exciting adventure of "COMEX registered silver" takes us next...

    Well...well...well, when on Thursday (after a 30% wackjob) the world looked like it was going to end for silver investors as the nasty DARK HORDES had taken control of the price of silver.

    Then on Friday some clouds cleared the way for a bottom and today we not only had a nice $2.00 move higher, but the announcement that Sprott Asset Management has just placed his queen close to the Nasty Bullion Banks King and announced CHECK, by announcing another Fund that will have a great big SUCKING SOUND when it comes to the shinny metal.

    This couldn't have come at a better time. Also, it looks like the energy sector has shot back towards the moon as well:

    OIL = +$5.52
    RBOB GAS = +$.18


    Time to get back to fundamentals...and that is, the DOLLAR is DEAD....the world just doesn't quite know it yet.

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  9. Regarding the SLV option put @ 25, he can make money as long as the price is moving down from the price he bought it at. It was for July? I don't know what silver was trading at when he bought it. Although, I thought I read a few days ago that it was worth 5 times his buy price assuming he sold on that day due to silver crashing this past week.

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  10. "Well...well...well, when on Thursday (after a 30% wackjob) the world looked like it was going to end for silver investors as the nasty DARK HORDES had taken control of the price of silver.

    Then on Friday some clouds cleared the way for a bottom and today we not only had a nice $2.00 move higher, but the announcement that Sprott Asset Management has just placed his queen close to the Nasty Bullion Banks King and announced CHECK, by announcing another Fund that will have a great big SUCKING SOUND when it comes to the shinny metal".
    -Awesome.
    + 37.922

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  11. Not sure if SGS is hinting at this, but if he chooses to liquidate, the market knows he has the position, so in order for him to get out, he will have to sell at a discount. Time is not on his side and his puts have no intrinsic value. The market knows this. People will try to nickel and dime him when he liquidates. I see the july 25 put has 124k in OI. The next biggest OI is the 33 put, with 47k.

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  12. The individual that made the $1 million put bet made a cool 700% profit. $7 million according to zerohedge.

    http://www.zerohedge.com/article/88-slv-shares-outstanding-trade-yesterday-silver-put-buyer-generates-682942295027173-annuall

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  13. @SGS wrote "he cannot cash in unless it hits $25, at this point he is not doing so hot"

    BS. He can trade his options anyday he likes. And when silver was down at 33 something his put options could have been sold at ten times the price he/she bought it.

    Surely you know options can be bought and sold every day until they expire. Why do you give such misleading information? I don't understand that ...

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  14. Hi iflash,

    Can you explain, how that trade could make money even though was never at the money, ie the put didnt go to 25? Did they make money due delta value are opposed to the intrinsic value?

    Work with me here, I still learning?

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  15. Malcolm, your option doesn't need to be in the money to go up in value. As you get closer to your strike price, that will increase the value of your option, while time decay will decrease the value of the option.

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  16. Thanks Black Sheep!

    So, they just did sell to close, to realize their profits?

    Is there any formula that one could use to calculate ROI for calls or puts? So,

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  17. The issue on selling 100,000 puts is finding people who want to buy them. Of course he can trade out whenever he wants to, but there has to be someone on the other side of the transaction willing to pick up his bets.

    And that could be challenging.

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  18. HUNT BROTHERS PLAYBACK 1980 READ IT HERE

    READ this story from PLAYBOY about what "REALLY" happened to the HUNT BROS! Sounds earrily the same as TODAY!

    READ IT HERE:

    http://www.scribd.com/doc/54739808/Silver-Finger-by-Harry-Hurt-III-September-Issue-1980-Playboy

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  19. I see. So they may not have profited at all.

    The trade would have best been executed when the market was still going down say around 34-35?

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  20. Hi Malcolm,

    it has to do with how the worth of options are calculated. An option has a time value (ie. the longer the expiry date is away the more chance there is that the options reaches the strike therefor the more expensive the options is). But an option can also have instrinsic value if the strike is already achieved. Example: A Silver call option with strike 35 and a spot price of 40 USD would already have an instrinsic value of 5 USD. Now depending on how long the expiry is away the more value is added. BUT: In real life it's even more comlicated as options vary in price EXTREMELY with volatility of the underlying. I have seen put options go up in a climbing though highly volatile market and vice versa.

    The guy that bought the 25 USD put option paid around 10 cents per option when silver was in the high 40ies (so it had a time value of 10 cents with no instrinsic value as the strike of 25 was not reached). When Silver crashed a few days later to 33 something, still there was no intrinsic value BUT: the chance of reaching 25 was far greater now thus. leading to an opton price in the 70ies cent area (or smiilar).

    Options are pretty difficult to master and react sometimes pretty odd because their value is always determind by two parameters: time (until expiry) and intrinsic value (i hope this is the right term in english). Unlke futures tey can NOT be rolled over. When they expire and have not reached there strke price, they simply vanish worthless (their tme value reached zero with no ntrinsic value)

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  21. thanks whale shark and iFlash for your contributions!

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  22. Thanks iflash!

    I have opened an options trading account and have been virtual trading for a while. I think I need to get my feet wet, get some direct experience, and hopefully not lose to much money, LOL!

    But, your information is invaluable!

    Thanks

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  23. Malcom, nice thinking! Which site? :)

    I´ve read some walktroughs until now and I think have grasped the basics of options, so Im ready for the next level (virtual trading).

    Still, how on earth can I profit from buying a call option with strike price of $25? Maybe a sudden drop to 24$ and then skyrocket-recoil to $100 ? Am I thinking right neow?

    Furthermore, I don't like how the SLV-price bounces off $37 again,

    Maybe 37 is the new 45 ? ^^

    Seriously, if it hits the wall of 37 again, I will convert all my paper into bullions basking in the twilight and consider buying $25 put options (However they dont exist here in Sweden..)
    Anyone who recommends a easy setup foregin trading account w\ options possibilities for a Swede? :)

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  24. I have a feeling that we will see silver head to 41.00. Then the Bernank is going to come out and say the economy is doing fine and we won't need QE3. (which we all know is a bunch of bullshit)add to that the greece BS and you have a set up for a little dollar rally. That will let JPM hammer the price of silver down between 20.00 and 25.00. I truly believe that person who made the 1,000,000.00 bet is an insider and knows something. From the 20 to 25.00 mark we head straight for 75.00 or higher after JPM is allowed to cover.

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  25. Men..., I spill lake shot!

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  26. CME hikes margin requirements for crude-oil trade, effective Tuesday

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  27. This comment has been removed by the author.

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  28. Come on, break through _38_ alreday! I wont fall asleep until it makes or breakes!

    Cause, I don't like the idea of pushing around a f*cking wheelbarrow full of silver amongst a bunch of hungry Hungarians.. yet.


    I agree with you Sierra_hpbt, the fallback to 20ies in paper silver probably will occur, the question is if we even are about to see _37_ first, or if we will go a bit beyond 50 and then dump all newly entered sheeple in one big sudden push over the cliff.

    "ImprobableUH, but not impossiblUH".

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  29. most all of the sheep have been fleeced..

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  30. Where do you look to see if our 25.00 SLV put guy has sold his position.

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  31. You would look at the 'open interest' for the SLV July 25 puts...but just because they are there it doesn't mean that he hasn't exited the trade another way. There are so many ways for this guy to take a profit on a load of long naked puts.

    For the Swede...try thinkorswim. I think they are the best broker for trading options and I know guys outside the US and Canada that use them.

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  32. Hi Walp .. i also see the 37.92 holding every time.
    someone sells it out to rea ch 37.5

    Also see how indian govt playng a role in gold price suppression

    The daily post is great. Wait daily to get to the new post.
    I am in India. Just wanted Ed Steer's to check this article. Looks like all the world's govt has decided to curb the gold price rise by making such schemes.
    State bank of india is a Govt bank. the largest in india.

    http://www.livemint.com/2011/05/10001957/Gold-scheme-gains-faith-of-tem.html

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  33. FACKFACKFAKCK, I fell asleep! And it didnt break through 38 :S... Things usually turn out good\bad at 12 o´ clock GMT here in Europe, so I´ll give it one more hour before deciding what to do.

    Thx Shaun, I will check it out later, cause Im not letting my eyes off the chart again, and missing another bear of the life oppurtunity, while the stock drops another 25%

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  34. 0758 (GMT) Just broke the 38 mark.
    The only way is up????

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