I dont understand the money scheme in Casino Royale

[Mo0o]

So the terrorist sold a large amount of shares of SkyFleet stock. So now he has his liquidated money from stocks as well as the money from the RUF guy. Then he wants to make the SkyFleet stock plunge w/ the explosion. and then what? how does he make money from that? Would he rebuy then slowly wait for it go up?

 

[KLin]

http://www.imdb.com/title/tt0381061/faq#.2.1.40

 

[everman]

He held a short position via options. If the stock went down enough he would have made godzillions.

 

[BillyBatson]

no he invested the money in like a competing airline or somethign so the failure of skyfleet would help his other investments go up or something

 

[Boonesmi]

"selling short" its a fairly common practice
http://en.wikipedia.org/wiki/Selling_short

 

[ultimatebob]

Originally posted by: BillyBatson
no he invested the money in like a competing airline or somethign so the failure of skyfleet would help his other investments go up or something

Nope... He invested in Puts, hoping that the stock would go down after the airplane blew up.

Besides, investing in a competing Airline would have been a bad idea. When a terrorist event like 9-11 happens, ALL of the airline stocks go down.

 

[Freshgeardude]

he put stocks to predict that the stocks would go down. he hired the dude driving the truck w/ gas and crash into the plane. if the plane was destroyed the stocks would go down which he predicted and it would make him alot of money. the whole casino thing w/ the competion was b/c the guy didnt blow up the plane , the guy lost alot of money so he did a competition to get the money back

 

[Ameesh]

he sold "puts" which is basically saying that he predicted that the stock price would go down and he was reserving the right to sell the stock at a higher price then it fell.


lets say stock A has a price of $25 right now. I think the stock price is going to go down

if I sell a put to you then i am telling you that i get to sell you stock A at some lower price in the future, lets say $20.

Scenario 1: You Win
When the date on the put contract comes up if the price is above $20 (lets say $29) I am SOL because I agreed to sell you a bunch of shares of Stock A for $20 so now i have to buy a bunch of shares on the market for $29 and sell them to you for $20 which you could then turn around and sell for $29 basically making $9 a share.

Scenario 2: I Win

The date comes by and the stock has crashed and now its only worth $10 dollars. You have agreed to buy my "put" which means I get to sell you the shares at $20, so I would go on the market, buy a bunch of shares for $10 and then sell them to you for $20 and then you are stuck paying $20 for shares that are only worth $10. I made $10 a share.


does this make sense?

 

[KLin]

No no no, he sold ROCK SALT!!!

/thread

 

[Mo0o]

Originally posted by: Ameesh
he sold "puts" which is basically saying that he predicted that the stock price would go down and he was reserving the right to sell the stock at a higher price then it fell.


lets say stock A has a price of $25 right now. I think the stock price is going to go down

if I sell a put to you then i am telling you that i get to sell you stock A at some lower price in the future, lets say $20.

Scenario 1: You Win
When the date on the put contract comes up if the price is above $20 (lets say $29) I am SOL because I agreed to sell you a bunch of shares of Stock A for $20 so now i have to buy a bunch of shares on the market for $29 and sell them to you for $20 which you could then turn around and sell for $29 basically making $9 a share.

Scenario 2: I Win

The date comes by and the stock has crashed and now its only worth $10 dollars. You have agreed to buy my "put" which means I get to sell you the shares at $20, so I would go on the market, buy a bunch of shares for $10 and then sell them to you for $20 and then you are stuck paying $20 for shares that are only worth $10. I made $10 a share.


does this make sense?

indeed it does , thanks

 

[Ameesh]

Originally posted by: Mo0o

Originally posted by: Ameesh
he sold "puts" which is basically saying that he predicted that the stock price would go down and he was reserving the right to sell the stock at a higher price then it fell.


lets say stock A has a price of $25 right now. I think the stock price is going to go down

if I sell a put to you then i am telling you that i get to sell you stock A at some lower price in the future, lets say $20.

Scenario 1: You Win
When the date on the put contract comes up if the price is above $20 (lets say $29) I am SOL because I agreed to sell you a bunch of shares of Stock A for $20 so now i have to buy a bunch of shares on the market for $29 and sell them to you for $20 which you could then turn around and sell for $29 basically making $9 a share.

Scenario 2: I Win

The date comes by and the stock has crashed and now its only worth $10 dollars. You have agreed to buy my "put" which means I get to sell you the shares at $20, so I would go on the market, buy a bunch of shares for $10 and then sell them to you for $20 and then you are stuck paying $20 for shares that are only worth $10. I made $10 a share.


does this make sense?

indeed it does , thanks

welcome

 

[conehead433]

Interesting that they played hold'em in the movie rather than the game Bond supposedly played - baccarat.

 

[RaistlinZ]

Originally posted by: conehead433
Interesting that they played hold'em in the movie rather than the game Bond supposedly played - baccarat.

I thought only The Brain from "Pinky and the Brain" plays baccarat. Man, I really miss that show.