A Bullet is a offsetting long position....usually a far out of the money call, hence cheaper.......held in a traded stock while trading to allow a trader to short on a downtick at a price other than the current level 1 ask.
Ah! But, the guy didn't Have to lose $1.10. He, along with 10 other people, could have lost $.10. Right? So that would make it a MINUS SUM Game. Not zero sum. -Pound
True. But that "someone else" could be long the stock with a profit, but you still HAVE to cover your short. He is NOT obligated to sell his stock. -Pound
True. But that "someone else" could be long the stock with a profit, but you still HAVE to cover your short. He is NOT obligated to sell his stock. -Pound This is true as well but at the time you were profiting from your short he was losing money on his long.
not for stocks for sure by a long shot. Maybe the closest one can get to a zero sum game is the futures market, but still you have to pay the vig and the spread. But stock NO WAY. Your friendly company that floated you paper at the IPO and all the secondary offerings does not have to buy it back from you (cover). The initial and greatest transfer of wealth took place already. Paper for your hard cash.! Josh
yes, excellent point...I think that if the mass populus were to think of stocks in terms of vehicles for wealth accumulation for corporate insiders, they would stop being such passive and apathetic investors in "long term" growth...The fact that the stocks are issued and allocated in chunks of tens of thousands or hundreds of thousands of shares with a cost of 0.01 to the owners says alot...