A year of lock-downs, stimulus checks, and colorful trading apps has turned buy-and-hold retail investors into regular users of powerful financial tools.How it all ends is yet to be seen, but one thing is certain: retail investors will wrongly be the target of financial institution's blame.This is an opinion column. The thoughts expressed are those of the author.My iPhone screen time is averaging 4 hours and 13 minutes a day. It used to be half an hour.
The allure of buying call options is that you can harness the power of owning 100 shares of the stock for only $31 in this case. Your worst case loss is only $31, but your potential gain is unlimited. Moreover, you don't have to wait until the expiration date to exercise the contract. If tomorrow Ford went to $20 per share, you could exercise and gain at least $669. The value would be even higher if the market expects increased volatility in the stock price.
in US history. My index and target date funds have performed well. I had never"played" the market. When my finance professor admonished the class that options are"for mitigating risk, not speculating", I agreed. My Vanguard portfolio shows a steady climb. Desperate for a hit, I started researching obscure Chinese electric vehicle makers, Canadian uranium miners, and gaming accessory manufacturers trying to turn the daily performance of my portfolio from red to green. January turned things around. Nokia suddenly shot through the roof. Thanks, WallStreetBets.Even now, I tell myself that"this isn't me." To some extent, that is true. I would never have been hooked on volatile trading were it not for a pandemic lockdown.