25 Comments
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Mary Waxer's avatar

Greg: I almost never comment, however, I am really concerned about this trade you mentioned.

You wrote: "I have decided to start aggressively selling puts." And mentioned SPY $405. I see them at like $0.13 to $0.14. If the market has a big blip or tanks, the amount of loss potential is staggering and most people, other then an expert like yourself, may not realize how very risky this could be. Someone not understanding fully, could literally wake up bankrupt with their brokerage having closed their position even if the market the next day partly or wholly recovered. The risks are staggering. I am just worried about you, but especially about anyone else who is less proficient who may not realize how they could be 'blown out' if the market makes a 'surprise' to the downside. And it could happen before they even have a chance to manage it, if the changes are deemed big enough by their brokerage to cover their position at usually the time where they are the most 'negative' financially. I will give an example: Someone sells 1,000 puts on 405 SPY June 15 and receives about $13,000. Market has a blip (bank failure, war, etc.) and SPY opens at 400, then your brokerage would show you as +$13000, and (I estimate) -$750,000. Since your account is so negative, they would have the 'right' to close out your position immediately (given the market can drop more) and you would then have zero position and owe them $737,000 due immediately! SPY could even recover an hour later and it would not matter. You would still owe that. (This would not happen if you had $737,000 sitting in account.) However, it is just a question of how much collateral you have sitting to cover a negative position immmediately available as to their willingness to wait to sell out your position(s). Your strategy worries me, however, I am much less experienced then you, so if you are able to succeed with these strategies long term I just hope G-d is always looking out for you. I always wish you the very best!

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Gregory Mannarino's avatar

I am well versed with regard to risk. This is not my first rodeo with selling options.

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Jay Blue's avatar

Mary, isn't your estimate given an assignment a little off? Each Put contract is for 100 shares. If you sold 1,000 Puts, than means 1,000 x 100 shares = 100,000 shares that you're at risk of being assigned. If you get assigned 100,000 shares at a price of $405 per share, that sum would be $40,500,000.

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SD's avatar

Brave man to sell naked PUTS which is bullish now.

I would only BUY PUTS in this environment especially since a down cycle is expected from now to mid July.

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SilverSurfer's avatar

picking up nickels in front of a steamroller ...

get ready for the whipsaw

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Dangerous Donna's avatar

😂😂😂😂👍

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Jun 8, 2023
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Gregory Mannarino's avatar

If you put this trade into a probability calculator, you will see that the trade has a nearly 99% probability of not getting into the money. I almost cannot lose.

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PDA's avatar

Greg..WTF????? You know better to make a comment like that. You are setting up your "Lions" for a potential huge loss. 99% my ass. Go ahead and kick me off. Bad form dude.

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Gregory Mannarino's avatar

I am not telling anyone to do, just what I am doing. I have hade a lot of money over the years selling options.

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Patrik's avatar

I think the risk is you will lose many followers Greg. Your voice is important out there.

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Joe Borelli's avatar

Greg, I've been following you for many years. In the early days you gave advice that would benefit most of your lions. But for the last year+ it's been the same gloom and doom every day with no real guidance, and now this trade which is not feasible for 99% of your lions who can't risk $40K to make $13.00. I understand its my choice to watch or not, I'm really commenting to help you in case there are many others who feel the same. I used to watch and enjoy every minute of each daily video, and now I watch maybe 1-2X a week, and then skim since the information is usually a repeat from the prior day, week, etc. I may be the minority, and for you, I hope I am. But for me, as a business owner, the most important thing is to know what my customers think, so I'm taking the time to share.

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Patrik's avatar

Just be careful. Unlimited losses is possible.

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Mary Waxer's avatar

Thanks Greg, I am glad you are well versed. Yes, although the theoretical max was over 40 Million, I was trying to guess at a potentially possible (although very unlikely) chance of a sudden low opening of say $400 on the SPY where the brokerage ends up covering the $405 puts and with my estimate of the cost of buying those puts on a crashing day with SPY around $400 of maybe $7.50, I came to the $750,000 'risk' versus the $13,000 gain by holding. Of course, the odds of a 7% move in the next week is very low but not zero. I was worried about most other people who may not have a handle on the very big numbers selling puts agressively can yield if things suddenly fell apart. Thank you so much for reaching out. You are a gem! However, you are correct, where did I get only a 7% sudden drop, it could be 20% on a really bad day. So in a way, I did 'sugar coat' even the actual risk a bit, ironically. Thanks again.

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Steve Wallace's avatar

Thank you Greg for your help in educating us in options trading. No matter which way the market goes I am learning. my plan is to use a small amount of capital and give options a try so that I can learn and prepare for when the Mmri enters the extreme level.

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callum's avatar

Wow selling naked puts is the act of desperate man. "99% probability" LOL.. you're making chump change while exposing yourself to MASSIVE risk. You can tell gregory has completely lost his direction...

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chris's avatar

So funny how once again Greg completely ignores and fails to mention the puts that he bought a week ago that he got destroyed on. No update on that trade huh Greggy? Clown!!

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Nicholas's avatar

Greg may still be holding those August puts. Someone asked a day ago and he said he's not liquidated them and when he does, he will let us know. It's probably not ideal to call the man a clown. That's mean brother.

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chris's avatar

To not mention it at all wheen he enters a opposing position is cowardly and clown like

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callum's avatar

However if his trade went the other way we'd have 5 posts about it by now....

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chris's avatar

100%

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Nicholas's avatar

I support this decision because I know you know the options game (given my lack of options trading experience and risk appetite I won't try replicate it). 410 is the last pivot low. Folks may buy your puts thinking a retest will occur at that level, but there's the 20MA and 200HMA on the daily timeframe in-between that may serve as support above 410 @ ~415 in my opinion. We do seem near resistance @ 430. What would be bad is if this is the final impulse of a bearish rising wedge on $SPY that then makes a measured move down to ~363! I hope the trade works 💪

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Dan Spain's avatar

Greg, are you OK? I see you threw YOUR MMRI out the window. I hope people are reading this thread to see that your idea is not gaining any traction. You're big time long JEPI. Isn't that enough to take advantage in a rise in the market? Love you, brother.

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Gregory Mannarino's avatar

I haven't thrown anything out the window. Look at a probability calculator with this trade and you will see why I chose it.

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callum's avatar

pRoBaBiLiTy CalCuLaToR 🤡

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VIS's avatar

Don't fight the tape and Fed is almost done. One will not make REAL or serious money in a 5% correction on SPY puts. Again, this is the best trading market in history.

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