HOLLYWOOD STOCK EXCHANGE
THE ENTERTAINMENT MARKET
THE ENTERTAINMENT MARKET
I should clarify - not a good idea for a small port to short options
Flash is right, of course, that you can make just as much shorting a movie as you can holding it long. If you have a small port, there is a real danger in shorting the opening weekend options, particularly the calls and puts. For example, say maxed out a short position on TWIL4.PU at the IPO price of H$2. You would have lost your entire original investment (H$40K). However, that option will cash out at about H$11, which means that you are also losing H$9 per share over and above your original investment. So you would have an additional loss of H$180K, for a total loss of H$220,000. If you're just starting, that's 10% of your portfolio. That's why it's not a good idea to short derivatives with a small port.
Here is a question for you big timers and folks who been around the block Nov 17, 15:12
For a small port, it's generally not a good idea to short a security unless you are fairly certain it is going to drop Nov 17, 19:53
Respectfully, I disagree... I think small ports can make as much on shorting... as they can buying... Nov 18, 10:37
Amend the Inner Message...you would be out H$4 million total- the 1 mill you invested, plus 3 million on top of that. {nm} Nov 18, 11:21
That's true, and I should have mentioned that...thanks for the additional info as well. {nm} Nov 21, 08:21
I should clarify - not a good idea for a small port to short options Nov 20, 16:56
Yikes much higher risk on shorts!! Do you take profit on shorts when the movie flops or??? {nm} Nov 17, 15:41
... or when the price has gone down from the purchase price and you 'cover' your short (which is like 'selling' it) Nov 17, 16:19
Short and Cover go together like Buy and Sell Nov 18, 06:57
To see how far negative you can go - check out negative port for "Bottom_of_the_Barrel" {nm} Nov 23, 10:19