At the height of the Cambridge Analytical scandal, when the stock was at its bottom, I had bought long positions in Facebook via leveraged derivatives, with a multiplier of 2.5x. This multiplier makes it so that if Facebook goes up 10%, I go up 25%. If Facebook goes down 10%, I go down 25%.
I'm a an opportunist. I've only bought securities a handful of times in my life, and I usually hold on to them for years. I figured it was a risky but well calculated bet. Zuck testified in Congres, offered solutions and promised (((them))) to be a good boy. The scandal was forgotten, and days later Facebook posted excellent Q1 2018 results. Needless to say I made a hefty profit.
But a few months later, the continuing success of these derivatives had made me arrogant. Instead of holding on to my 2.5x leveraged derivatives, I thought I would sell them all, and buy the 4.5x leveraged ones instead, exactly the day before Facebook released its quarterly report.
At this point, I was no longer investing, I was trading, which goes against my own principles. But Facebook usually surpasses both their own forecast, and analysts expectations (surprise factor).
So if history was any indication, this would have been a risky, but worthwhile bet.
And during the height Cambridge Analytica scandal, Facebook "only" lost around 19% of its value relative to its peak.
Surely, nothing that bad could happen right? My derivatives were 27% away from its Knock Out price. Meaning that it would take another scandal a la Cambridge Analytica, and then some, before I would loose all my money. But it didn't even matter because everyone expected Facebook to post excellent Q2 results.
Facebook released its Q2 2018 report
.
Pass me the rope buddy boyo. A nigga can't cope no mo
I'm a an opportunist. I've only bought securities a handful of times in my life, and I usually hold on to them for years. I figured it was a risky but well calculated bet. Zuck testified in Congres, offered solutions and promised (((them))) to be a good boy. The scandal was forgotten, and days later Facebook posted excellent Q1 2018 results. Needless to say I made a hefty profit.
But a few months later, the continuing success of these derivatives had made me arrogant. Instead of holding on to my 2.5x leveraged derivatives, I thought I would sell them all, and buy the 4.5x leveraged ones instead, exactly the day before Facebook released its quarterly report.
At this point, I was no longer investing, I was trading, which goes against my own principles. But Facebook usually surpasses both their own forecast, and analysts expectations (surprise factor).
So if history was any indication, this would have been a risky, but worthwhile bet.
And during the height Cambridge Analytica scandal, Facebook "only" lost around 19% of its value relative to its peak.
Surely, nothing that bad could happen right? My derivatives were 27% away from its Knock Out price. Meaning that it would take another scandal a la Cambridge Analytica, and then some, before I would loose all my money. But it didn't even matter because everyone expected Facebook to post excellent Q2 results.
Facebook released its Q2 2018 report
.Pass me the rope buddy boyo. A nigga can't cope no mo
