Ted Graham

@KevinLMak : I sold the last of my $SPHR, thanks! How are you thinking about $LKNCY at $30?

@KevinLMak @hntrbrkmedia Are you still following $EVLV? I'm not seeing negative news to push it below $6.

$EVLV If you're new to the story, read this article in Wired: wired.com/story/evolv-gu… Wow, what an absolute horror show right? Now contrast it with @hntrbrkmedia article about Evolve here: hntrbrk.com/evlv/ The thing is I think both articles are diligently researched and factually correct, but they lead the reader to draw extremely different conclusions. I think the arbiter of which "spin" is more correct is the audited financial statements, which we conveniently now have. They show customers are not cancelling, in fact they're consistently increasing/growing their subscriptions and new customers are signing up at a quick pace. --- My favorite quote from the Hunterbrook article: And Fernandez, the Director of Safety and Security at Madera Unified School District who spoke with Hunterbrook, said he wouldn’t consider cancelling. Fernandez claimed the company was up front with him about the limitations of the platform under certain settings, but did not take their word for it. Instead, he had law enforcement professionals walk through the machines with “every weapon imaginable” — and it worked.

@KevinLMak Do you rebalance options as volatility or price moves?

$VOD Sold the $12C’s and bought 2027 $20C’s. Still chilling with the 2026 15C’s. Reduces dollar and delta exposure but more tail upside with the higher quantity of contracts.

@KevinLMak : any thoughts on $EVLV's latest earnings?

@KevinLMak @__paleologo I have this problem. A friend recommended an electricity trading investment. I couldn’t get over the 0 & 50 and they did over 200% in the first year.

@__paleologo Thanks! But i imagine how real investors feel about this versus what is “optimal” is not necessarily aligned. Plenty of LPs out there who have a set “max fee” rate and won’t consider anything above that, dogmatically.

Someone told me “only net returns matter.” I disagree. Gross returns measure skill. Net returns measure what the investor gets. The gap between them reflects how well, or how aggressively, the manager prices that skill. If two managers have the same net returns, the one with higher gross returns and higher fees is usually the better investment, assuming the track record is robust, long, diversified, and spans multiple cycles. That manager’s alpha is likely more durable, and if it erodes, there is a larger fee cushion that can be renegotiated. This is not an argument for paying high fees. It is a reminder that evaluating performance means looking at both gross and net.

I sold these calls between $2 & $5 over the last couple days.

@KevinLMak Offsetting flow is every market makers dream!

I honestly don't know precisely. To a certain extent you buy synthetic short, they are synthetically long, they short spot (and they have better access to borrow via their institutional trading desks) so they make the margin there. I think to another extent the synthetic short gets pieced out to different counterparties, you're short the call and long the put, some counterparties are long the call and others are short the put and it just "diffuses in the market".

$CORZ / $CRWV Breaking my moratorium posting about CORZ. My disclosure is that I'm actively trading it with many positions, and they change quickly/daily, so it's very possible you're on the other side of one of my trades. Arb trades are extremely price sensitive and information flows swing quickly. Currently: Short CORZ Sept $12P Long CORZ Sept $8C (boxed with short stock) Long CORZ equity Short CRWV Synthetically using various strikes. The two main bets I have on: I think CORZ won't fall drastically (short Sept $12P's). I'm long CORZ short CRWV at the .1235 deal spread. This plays out five different ways: A) CRWV Falls drastically post earnings unlock. CRWV downside generally seems higher than CORZ downside. Trade makes money. B) Status quo, deal closes, trade breaks evenish. C) CORZ shareholders threaten to block the deal and gets a recut. Trade makes money D) CORZ shareholders threaten to block the deal, no recut is offered, shareholders blink and deal closes as expected. (break evenish) E) CORZ shareholders threaten to block the deal, no recut is offered, deal fails. (Trade P&L depends on the two independent-ish prices. You're long CORZ and short CRWV, which isn't a terrible pair to have on IMO. To me, "a successful recut is obvious*" for a few reasons. 1) With CRWV at $120ish, the offer is $14.80, or 27% lower than the headline offer of $20.40. I believe the proxy services that advise the passive holders will likely recommend voting the deal down (implicitly asking for a recut). 2) CORZ Shareholders aren't really any better off with a deal in the $14-$15 range. It isn't really a win to accept it. 3) Strategically CRWV still generates significant value even if they pay more. They're saving significant cash (margin) by owning the property outright, they keep the capex "in their own house", they get access to the CORZ balance sheet cash + warrants, they get access to additional megawatts to expand to. * "Obvious" in this situation to me is like.. a ~60% chance, not a 98% chance. It's the most likely scenario from my perspective. The exact size of the recut/sweetener is up for debate. How much would it take to get shareholders to agree? I doubt they recut it all the way back to $20.40, but there's a lot of space between the current $14.80 and $20.40 level that is enough for both sides to be "happy" with. I do think that a recut (higher share ratio) is not worth talking about until at least a few days (probably a week) after the CRWV earnings and the unlock to see where the stock settles. If it doesn't recut, there are other ways to win/break even. However there is a downside scenario where CORZ gets left at the alter AND CRWV thrives without it. I think that combination of events is <5% chance.

@KevinLMak How do the option sellers hedge? My background is in futures options, where there are no borrow fees or shorting limitations.

up till now/early next week you can't short crwv, there's little/no borrow available. Also, if you short normally you're subject to changes in the borrow rate that in theory is uncapped and could blow up in your face. When you short synthetically you "lock in" a fixed rate of borrow all the way until the options expire.

Wild trading in $SPHR this morning. Premarket loved the Q2 results and then it sold off hard at the open.

@diptinto @mattyglesias That is a largely unimportant concern for Level 2 at-home charging which generally happens in multi-hour / overnight sessions. I'll try to pull data to prove that.

@tedgrahamdenver @mattyglesias It looks like this works by limiting charging speed when load is high elsewhere. One saves $$$$ upfront but the solution may prove suboptimal depending on charging urgency and overall demand.

@mattyglesias It is much simpler than a service / panel upgrade, any electrician should be able to install the energy monitor while installing the charger. And our support team is amazing if you have questions; they answer the phone on the first ring.

@BDM110110 Any thoughts on CLMT now that the index rebalancing is complete?

My long thesis on $CLMT. PDF below. drive.google.com/file/d/1PPvhoh… 1/4

@KevinLMak Have you seen enough improvement to justify the increase to $18?

$PGY Q1-2025 Analysis Exec Summary: Pagaya's Q1 numbers were very solid, basically as good as one could expect after coming out of a very messy 2024- and slightly better than the expectations that they've set for investors. IF they can show the market that they can consistently operate at these levels, the company should be back on track with its growth aspirations. This quarter sets a strong precedent, but at this point investors likely need to see more data to get comfortable and confident with the business. Highlights/My notables: Their loans in the Single Family Rental (SFR) market have notably bad margins, probably a money loser. I think they wanted to chase this for growth and are now giving up (or certainly scaling back). They went out of their way to show their FRLPC Margins without SFR being much better, and also note their growth rates ex-SFR. I think this is a good move by the company. FRLPC is at an all-time-high of 4.8%. This number is extremely important as it's effectively their gross profit margin equivalent. It's up from 2.5% a couple years ago. They've continually promised to investors that they could use their market power (relationships, vendor lock-in, etc) to increase their FRLPC and they've consistently increased this every quarter for years. This is great to see, and based on their growth expectations, I think this will be north of 5% next quarter. ALSO this number is so important because it's gives buffer for their retention %. Their ABS retention is down to 4-5% (from 8-12% at the worst times 1-2 years ago). This is the risk that they have to keep on the books. If they can keep retention down, AND increase FRLPC, they're at the point where "in theory, they can lose all the retention assets and still make money". Their G&A expenses are down to $46M, compared to $63M YoY, and $55M QoQ. This suggests to me that they are very serious about "trimming the fat". Increasing revenues by 19% and cutting G&A by 27% is great. Loans on the balance sheet are down (with higher revenues). This is showing the reduced retention requirements impacting the business and making it more efficient. They've reiterated "We do not need to, or plan to, do an equity raise". Good signaling and disciplined statement that they have to stick to. Loan losses/credit impairments were $30M which is, under control. Everyone's going to be watching this number in the next couple quarters to see if the company has truly cleaned up its act. So reiterating what I said in the Exec Summary, the company is operating very well. This type of business is opaque (the credit losses are hard to estimate and could be a ticking time bomb), which means shareholders have to fully trust management. This quarter of financials is a great step in that direction, and I'm hoping to see subsequent quarters of similar (or better!) performance. Last year my weight in PGY fluctuated between 5-10%, and that fell to the 1-4% range after the surprise credit losses. I'll likely build back up as I regain more confidence with more data.

@Akston_Capital You can sell boxes to borrow more cheaply than IB’s margin rate.

2) I think going 100% long TIPS at these real yields provides an excellent funding mechanism for future equity purchases during inevitable bear markets over the next 30 yrs. Margin rates at Interactive Brokers are based on Fed Funds rate + 0.75%. Over time Fed Funds is correlated to inflation rate

Buying the long US TIPS at a real yield of nearly +2.80% seems to me to be the best deal out there for protecting liquid wealth. I've put ~30% of my personal capital into this over the past month. My working hypothesis is that I should probably put 100% into them. Here's why:

My seven year-old Tesla just drove me 65 miles in the rain and I never touched the wheel. Elon Musk is a lunatic but that is impressive.

@KevinLMak @cullenroche I worked in high frequency futures trading for 12 years and our system didn’t have the ability to send a market order.

Slightly old thread but I want to jump in. People are misinterpreting @cullenroche . They assume he means using a limit order, to try to make the spread, instead of pay the spread (the typical comparison of mkt vs lmt). This introduces the risk do not getting filled at all. What he’s actually saying is use a “marketable limit order” instead of a market order. If a market is $10.00 x $10.02, instead of doing a “market buy 200 shares” (and assume you will fill at $10.02 or $10.03 ish)- Place a “limit buy 200 shares @ $10.20”. The exchange will lift the offer just like a market order would- UNLESS the 0.01% chance someone fat fingered a market order in the 1/100th of a second your order is in flight and the the ask went way up. In THEORY, once you place your “mkt buy 200 shares” order in, it could fill for any price- say $15, if all the offers disappeared for some reason”. The marketable limit order won’t fill at stupid prices because there’s a limit on it. It’s “free insurance against something stupid happening”. A different version is where there isn’t deep volume in the order books you see 200 shares at $10.02 and “market buy 500” and the next 300 shares fill at $11 because the next level of liquidity in the book.

Small things in finance that drive me crazy: 1) When people use market orders. 2) When people post price charts of returns.

@KevinLMak @Hedgeye What happens at $30?

$SPHR Short call from @Hedgeye on Sphere. I've spoken with the team that covers Sphere a couple of times and am mostly aware of their thoughts. Only the notes have been released, with a more substantive call/presentation from Hedgeye next week. From what is there, nothing strikes me as insightful or news. It's looking at the same data everyone else has from a different angle, "optimist vs pessimist" sort of thing. Recent data points seem to have tipped them from one side to the other since they used to have a bullish/buy call back in May. They're primarily looking at "softness of the print" in the near term, and my thesis (admittedly it has pushed out since my original analysis) is that the fundamental business is extremely solid and will make a lot of money. "Eventually" could be 12, 24 or 36 months from now. My thought is it'll be $80 sometime in the next 2 years, but when that exactly catalyzes (as with all "repricing events"), is pretty random. I have no problem buying/adding all the way down to $30 and welcome the opportunity, I remain patient on this name.

@Sam_Harry8 @Slammersbasball @CastleViewBall @football_castle @The303Factory @SacStBaseball Congratulations Sam!

I am extremely blessed to announce my commitment to further my academic and athletic career at California State University Sacramento. @Slammersbasball @CastleViewBall @football_castle @The303Factory @SacStBaseball