smasty 8:37 am on Thursday, November 21, 2019

CRM Short

Did anyone catch Benioff’s interview two nights ago w/ Cramer? I found it troubling. I’ve always been a Benioff fan, but I’m seeing that he’s maybe losing focus. He spotlighted a stupid “Einstein Doll” that is supposed to talk and answer questions “you can buy it on Amazon”….huh? The doll didn’t work, it was an awkward moment. He seems to be losing touch w/ any kind of shareholder focus. I put a short on yesterday by selling shares and buying a protective call. I sold shares at 163.25, the call was an expensive January 165, so I need a sharp move down to make money, but it was in the 140’s not too long ago. Earnings coming up. Curious if anyone else saw it, if it hit you differently.
Sue

thomberg1201 10:56 am on Thursday, November 21, 2019

I didn’t see it, but that’s interesting, he’s been on Cramer often over the years.
- smasty 12:14 pm on Thursday, November 21, 2019
  
  It’s funny, Cramer’s book “Confessions of a Street Addict” is really good. He tells the story of being in Hawaii and seeing a goat on a surfboard wearing a GoPro….he thought “this is a sign that the stock has topped.” So when I saw Benioff hawking an Einstein doll, I thought “uh oh, this is a sign…..”
  
  But it’s other things, there’s a big social agenda that has developed at Salesforce, which is fine, but eventually will hit margins I think. There was a corporate arrogance to him that I’ve seen ramping up, but became more evident. The stock has been under-performing until just recently, so the timing is good for a short. All of these things are squishy, I know…so it’s definitely a speculative trade for me.
  
  By the way, this is a big market maker trade– “taking” the retail covered call trade. When a liquidity provider takes the retail trade, they are shorting stock/buying calls. It results in a 50% short delta. As soon as they can they’ll begin covering the short shares but leaving on the long calls until they wind down to a neutral delta, which then profits in any direction. Further down, good, whipsaw back up, good. Now that there’s no commission on stock trades, delta manipulation by buying/selling even only a few shares is easy–no cost!