Week 18 - May 3 Investment Moves

May 3 Stock Market as of 10:31 AM (EST)
May 3 Option Trades
Stock Buyback: Why it's important?
Why most Cryptocurrencies have no value.

May 3 Stock Market as of 10:31 AM (EST)

Here is the current market

May 3 Option Trades

Here are my trades for today.

Summary of my trades:

Rolled my Visa Covered call UP (in strike price) and Out (in time) for $155 premium. In exchange, I can potentially make $500 if Visa trades over $280 a share while collecting the $155 in CASH today.
Rolled Call Side of Visa Iron Condor down. Collected $41 for each contract. This change adds more risk to the trade, but VISA has been trading down the last week or two.
Rolled On Holding Covered Call up and out for $11 premium.
Rolled BMY Covered call up and out for $4 premium.

Stock Buyback: Why it's important?

Apple just announced a $110 Billion dollar buyback of it shares yesterday. This is pushing the stock price higher for the largest company in the world.

At $2.7T market cap, why is removing 100 Billion of shares important? The concept of stock buyback can be summary as:

Reduced the supply of shares to the open market.
Increases EPS (earning per share), which will benefit each existing shareholder.
Used to signal to investors: Our shares are cheap.

https://finance.yahoo.com/news/apple-110-billion-stock-buyback-220603961.html

Why most Cryptocurrencies have no value.

If you have been following smaller projects or the "ALT coin" market, what does the common pattern seem to be? There is generally too much TOKEN supply, not enough demand, and the slow move toward zero. This is true when you join a #play2earn game, where tokens seem to be "given" out daily and hence everyone's BAGS get bigger. While your brain likes to see your TOKEN count go from 100 to 120, the value of the token dropped from .10 to .08!

A company share is often associated to a piece of the profit of Apple (in this example). By reducing the share count, your piece of the profit grows and hence will drive up the value of the share of Apple.

Most Crypto has no valid use case to hold and own the digital asset. When that happens, the demand for the TOKEN is only limited to a few people. When there are more people dumping the token, the price will continue to drop.

BURNING of coins is often best viewed as the share buyback in the Crypto Industry. Why do ALT coins need billions or trillions of TOKENS? We all end up with large bags of worthless tokens, which is what we learned from watching HYPER-INFLATION do to Zimbabwe (2007), Hungary (During WWII), and Yugoslavia (1991).

This is why understanding how assets work has given me an understanding that most digital asset will fail. If you decide you want to invest in Crypto, you might want to only stick to Bitcoin and Ether.