One of the greatest traders of our time - Nancy Pelosi. Joking aside, I was looking through her recent trades and couldn't help but notice how well structured they are. Her choices for the longs are very similar to how I set up my diagonals.
She's using long calls as a surrogate long stock position to take advantage of the leverage afforded by options. For example, the GOOG trade cost around $940K for her to put on. A similar stock trade would've been around $2.9MM.
She uses two different long call strategies, based on her disposition towards the stock.
For more developed equities like GOOG, MU, DIS, she selected slightly shorter term expirations but went further ITM. This allows the trade to behave more like long stock while decreasing the impact of theta decay on the options.
For more growth oriented equities like RBLX and CRM, she selected LEAP expirations and chose strikes closer to the money (although, still ITM). This offers more growth opportunity in the options if directionally correct, while still limiting the impact of theta decay on the longs.
She selected all established products with promising lines of business going forward. DIS surprised me a little bit, but since COVID they've been pivoting more and more to telecomm so I can understand her thought process the.
The choices she made are not the cheapest method to gain exposure, however, these are
well structured trades. Diamond hands Pelosi at it again.
Notes: -I'm not suggesting that Pelosi is actually any kind of great trader - the post is generally satire. The focus is more on the construction of the trades. -The post isn't about how she selects the products, if there's insider trading, etc. -To clarify, Nancy's husband makes most of the trades and she is required to report them. I have absolutely no idea who is actually structuring the trades, if they have an advisor, etc. Again, calling her the great trader is more of a joke than anything.
Be An Outlier! Erik esInvests YouTube