Rivian has been one of the most speculative stocks lately, as it rose from IPO price of $78 to all-time high of $179 (130% gain) in less than a week. With strong backings from Amazon and Ford Motors. This stock is touted as the new Tesla and may become the dominant leader of truck delivery. The rise coincided with the sell-off from Tesla (due to Elon Musk selling his Tesla shares) as hot money flows into Rivian stock.
However, Rivian fell by 18% on its first loss day yesterday and continues to fall another 13% today. I believe with Tesla gaining favour once again, money will flow out of Rivian and go back to Tesla. Also, for those who are sitting on a huge profit, they may sell off their shares to secure their profits, which creates more selling pressure on the stock.
I bought a LEAPS PUT option (my first LEAPS PUT) to capitalise on the bearish trend of Rvian.
Details are as follow:
Stock Name: Rivian
Type of Option: LEAPS PUT
Strike Price: $70
Premium: $13.50
Date of Expiration: 20 Jan 23
Share price of Rivian when I bought the LEAPS contract: $129
I think as the hype surrounding Rivian has died off, there is a chance that the stock price will drop further, maybe back to IPO price. Just as how a LEAPS CALL can give me a magnified return when the share price goes up, LEAPS PUT on the other hand will also give me magnified gains when the stock price crashes.
Learning Investment With Jason Cai 
Fascinating that after the stock gets slaughtered you now say you bought puts.
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I have never believed Rivian was worth its 130% price increase in a single week, that is why I bought PUTS, expecting it to drop further. If I had advocated that Rivian was my strong conviction stock, then buying PUTS would be contradicting what I have said.
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It’s the timing. Your first ever put buy and wham the stock gets slaughtered. No mention of anything at all from you until after the stock gets hammered, then you say you bought puts.
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This blog is probably Jason’s trying to pen down his investment journey and he had gracefully shared it – either as education or inspiration.
I am fascinated by your post which felt Jason needed to defend his position or share his views before penning him buying puts. Go and get a paid subscription if u need advise on stock selection and stop acting like an entitled bumphead.
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Just as amusing as many of his posts. It’s comical to read he claimed to buy kits for the very first time and the stocks down huge. What’s next? Is he going to pick the winner of last year’s Superbowl?
The bottom line on all of this is for these short term moves, if he could actually predict them, then using short term options would pay off many times more than the leaps.
Advice? LoL subscription? LoL… Ahh no thanks
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I still don’t quite understand what you are driving at. The stock goes down, I bought a PUT contract and I am making money now. I shared it. So what’s wrong with that? Are you implying that I should predict that Rivian is going down first, announce to the whole world that I think Rivian is going down soon, buy a PUT contract quietly, then watch Rivian go down, and only then I can have your permission to share that I bought a PUT contract? I am not here to prove that I can predict price movement. I observe and feel it is the right time to ride on an uptrend or downtrend so I place my options accordingly. I am just sharing for info on what makes me money.
The reason why I am not using short-term options is for the risk of a trend reversal, as anything can happen in the stock market. By using LEAPS, whether I am bullish or bearish, it gives me more time to react just in case the trend goes against me. I can still average down my LEAPS CALL and wait for the share price to rise again, which I know will happen for good companies like the big tech in the long run.
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Thanks Kelvin! I am really encouraged by your message. I started this blog not to try to teach options or show anyone I am far more superior than them. In fact, I considered myself still a newbie to options and learning every day. I just want to share what works for me. I understand that some methods may not go well with the options “experts”, such as buying LEAPS with low delta, or buying LEAPS to ride on the bullish trend, but I am okay if people have a different opinion. At the end of the day, it is just this knowledge that I wish to share to help people change their lives. I watched many YouTube videos and learn for free and now, I am just passing forward the kindness to fellow options traders who may need it. I have heard that it takes years to learn and make money on our own but that is not true. I took one full year to learn on my own and made my 6-figure profits. And that gave me the courage to realise a 80k paper loss, which I have been carrying for years. Anyway, I great appreciate your message and all the best!
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