I've closed my short call position, and now hold no exposure to GameStop outside index funds. Ah, quite a relief!
Next, one of two things will happen:
(1) I'll stay away from GME shares and options
(2) I'll sell GME calls next month near the time of the shareholder's meeting
Volatility is too low to sell calls right now. VIX is in the 15's. Maybe that will change next month. If anything, I'm tempted to go long S&P index calls. One could 2x leverage the S&P 500 for the entire year of 2022 with a maximum downside of about 12-15%.
Well, S&P doesn't have much to do with GME deathwatch, but I'll bite.
Do you literally mean "S&P index calls", as in ^SPX call options? Buying 2x those costs about $200,000 each contract. Those are the only calls I've ever seen with negative time value - they are sold at a discount. I suspect that's because 2x calls aren't that popular, tie up a lot of money, and can't be exercised like other options (they are cash settled).
My guess is you meant SPY calls, which can be exercised to get shares of SPY (the S&P 500 ETF). I've managed to buy those 2x options for under 1% time value over 2+ years, which seems like a good deal to me.
But there's no such thing as "maximum downside of 15%". If the S&P 500 falls 10%, these 2x calls take a 20% loss. It's very unlikely that Dec 2023 calls will be 20% down from here, but it's possible.
Back to GME, the VIX is useful for non-meme stocks. I've heard options with 100% implied volatility called extremely volatile, but GME hit 4000% implied volatility back in Jan/Feb. Although an interesting idea - if GME has volatility similar to the wider market, maybe that spells trouble for GME? Nobody wants to go very slowly to the moon, especially if they're below escape velocity and fall back to earth ...
(Or maybe "escape volatility"?)
The most recent news item on GameStop's website is about hiring 500 people for customer care. It's part of the move towards better customer service. Which is nice... but might not be a huge transformation on the scale people imagined.
https://gamestop.gcs-web.com/news-releases/news-release-details/gamestop-hire-500-employees-new-customer-care-center-southThe next GameStop quarterly meeting happens Dec 6, not Nov. I'm assuming price and volume will increase the week before this meeting.
"Q3 2021 GameStop Corp Earnings Release 6 Dec 2021 / 6PM CST"
https://www.reuters.com/companies/GME.N/eventsIt's a convenient trade, if I try to do it. I can wait for activity, and then decide if I want to short shares or calls. There's a dozen analysts covering GameStop, and the fundamentals are likely to disappoint relative to it's current market cap. So there will likely be a drop from their negative views, at which point we find out if GME fans start buying to make up for it.
Either way, weeks afterwards the stock is likely to be down, and I'll wait for that. Or maybe I'll just ignore the whole thing, and invest in something more predictable!