27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE:SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.
3D Systems’ Difficult Decade
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One stock that had one of the most volatile and ultimately disappointing decade was 3D printing stock 3D Systems Corporation (NYSE:DDD).
The boom and bust of 3D printing stocks was arguably one of the biggest market bubbles of the 2010s. In late 2013, 3D printing stocks were the closest thing investors had seen to dot-com bubble valuations in more than a decade. At the time, 3D printing bulls justified those valuations and argued that printers would ultimately be as common in U.S. homes as microwaves. The slight oversight in that thesis ended up being that nobody actually needed or wanted 3D printers.
In highsight, the idea that 3D printers would follow the same growth trajectory that 2D printers followed makes little sense. 3D printers are far more expensive and difficult to buy, use and maintain than 2D printers.
Incredibly, 3D Systems shares started the 2010s trading at around $3.85. By the end of 2010, the stock had dropped to $3.50, its lowest point of the decade. From there, the buying frenzy took hold. By early 2014, the stock had reached $42.35, marking a 1,000% gain from the start of the decade. 3D Systems shares continued surging, ultimately peaking at $97.28 in early 2014. Traders that sold there cashed in a 2,426% gain in roughly four years.
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Since that top, the bursting bubble sent 3D Systems crashing back below $10 by early 2016.
2020 And Beyond
3D Systems finally bottomed at $6 in 2016.
3D Systems has yet to come close to returning to its all-time high, but the but the stock has since rebounded to the $12 level. After a wild ride, $100 worth of 3D Systems stock in 2010 would be worth a disappointing $311 today.
Looking ahead, analysts expect another rough year for 3D Systems in 2020. The average price target among the six analysts covering the stock is $8.50, suggesting 29.1% downside from current levels.
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27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.