999 Warren Buffett Quotes - Learn His Secrets of Investing During & After Crisis
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One Up On Wall Street SUMMARY Part 3: The Long Term View Chapter 19 – Options, Futures and Shorts
- Peter Lynch have never bought a future nor an option in his entire investing career
- Stocks are not commodities, stocks are part of a business
- An option is a contract that can expire
- Very high risk of losing money
- They may not seem expensive but you have to buy a lot of them to cover a stock
- Buying an option has nothing to do with owning a share of a company
- The money is not even transferred to the companies only brokers get to enjoy them
- Warren Buffett thinks that stock futures and options must be outlawed
- There is a practice of profiting from a stock price that goes down
- Shorting is you borrow a stock and then sell it. Then you buy again and then return it to the seller.
- Selling the borrowed item at a higher price and replace it with lower price item is where they profit
- The problem is the owner will get the dividends and other benefits but not the borrower
- You must close the transaction to cover the value
- There’s no ceiling on stock price, you will lose money when it goes up
- Short seller stories are horror stories
Read One Up On Wall Street by Peter Lynch Chapter 18 full summary here 👇:
http://mysweetluck.blogspot.com/2020/09/one-up-on-wall-streetsummarypart-3.html
Watch One Up On Wall Street by Peter Lynch Chapter 18 full summary here 👇:
https://www.youtube.com/watch?v=75sN2Oc9n3Y
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