The S&P 500 hit a new high on Friday, so my belief is there could be some large movement in either direction. To take advantage of this move I employed a strangle trade on the SPY May 1st weekly. My strike prices are $208.50/$211.50 (put/call).
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Showing posts with label strike price. Show all posts
Showing posts with label strike price. Show all posts
Sunday, April 26, 2015
Weekly Options Play
During this years earnings I have been dabbling in the weekly options. I've been looking for bigger swings in the call/put trades and leveraging larger trades. To accomplish this, I have been using the SPDR S&P 500 ETF (SPY) Last week I had purchased 25 SPY April 24th $213.00 calls for $0.05 and got my opportunity a few days later to sell for $0.11, but missed my sale and never recovered on the trade. The options expired worthless.
The S&P 500 hit a new high on Friday, so my belief is there could be some large movement in either direction. To take advantage of this move I employed a strangle trade on the SPY May 1st weekly. My strike prices are $208.50/$211.50 (put/call).
The S&P 500 hit a new high on Friday, so my belief is there could be some large movement in either direction. To take advantage of this move I employed a strangle trade on the SPY May 1st weekly. My strike prices are $208.50/$211.50 (put/call).
Tuesday, May 04, 2010
Long RIG
It looks as if a bottom has temporarily been established for Transocean Ltd (RIG) around the upper 60's. I'm not exactly sure how this unfortunate oil spill will play out, so it could get much worse for RIG, however most news sources seem to be focusing on British Petroleum (BP) at least for the current timeframe. I have entered some speculative plays with some LEAPS and bought a large amount of Jan 2011 calls at strike prices of $125.00, $130.00, and even $160.00. I was able to get these options below fair value pricing according to the CBOE options calculator. If this stock recovers and moves in my direction, I could have some large upward price swings, which I look forward to taking advantage of.
Monday, April 26, 2010
Deckers Put
I was looking at some charts Monday morning and came across Deckers Outdoor Corp (DECK)and noticed a large gap up with a high of $158.47 on Friday after their quarterly earnings report from a day earlier. I'm looking for a retracement back towards the 20-day MA and 8-day trigger, which is between the two red horizontal lines. The range of the lines is set between $133 and $144. In addition, the stochastics are approaching the overbought range, which provides a little bit of validity.I purchased 1 Jun 2010 put with a strike price of $145.00. I got in at $3.70 and today traded up at $5.40.
Tuesday, January 19, 2010
Going for Gold
I'm testing the waters by going short on a little gold. I picked up a Feb $112.00 put on (GLD) @ $2.95.
Tuesday, February 03, 2009
RIO Covered Call
I'm putting my stocks to work for me by selling covered calls against my RIO position. I sold Feb $14.00 calls for $1.15. I honestly was not thrilled to put this trade through, however its price trend is a tad bit below the $14.00 strike price, so I am banking on this continued trend.
Monday, November 12, 2007
My First Options Trade
Well today I was full of apprehension because over this last weekend after the market took a drubbing, I decided to make my first options trade ever! I have been doing research and read a great book "Understanding Options" by Michael Sincere. It takes a very common sense approach to beginning options and is extremely user friendly. Anyway back to our regular programming. I have been following Vasco Data Security International INC (VDSI) for awhile and have even previously blogged about it being on my watch list.
On 25 October 2007, after doing my due diligence I finally picked up some shares on a pure momentum play and based on earnings at $30.02. The analysts were a bit disappointed with VASCO's earnings and valuations at the time, so the stock took an immediate tumble the very next day. Of course this sucked quite a bit and I was initially put off, but the more research I did the more I realized how this company has true worldwide exposure and are a true leader in their respective marketplace. I decided to hold on for the ride and watched it tumble down to the low 20's. On 8 November, I picked up more shares at $20.05 to shrink my cost basis realizing this was a great buying opportunity and that VASCO was being punished based on the overall marketplace not on the value of the company.
Now to the main point of my post. Today I took my first giant step into the options market by placing a covered call sale via my brokerage at Scottrade.
At first, I was a bit nervous thinking I was going to mess up my first options trade and end up costing myself a ton of cash. My main decision was what was my time frame and strike price for the covered call. I decided that since this was my first trade I did not want to space this trade out for many months, so I needed a strike price that if exercised would still allow me to earn a little profit. Based on my previous price points (mentioned earlier) I entered a sale for the December calls with a 25 strike price. My order was filled and I received a premium of $1.20. As you can see, I could have probably got a higher premium, but the NASDAQ started dropping this afternoon and I did not want to lose out on a trade just over a few bucks.
Lessons Learned: Don't get nervous it's just another trade, so it's not like I'm selling naked puts or calls where the risk is extremely great. All-in-all, I'm pretty happy with the trade and hope that the option does not get exercised because I still believe that VASCO will go higher just not sure if it will accomplish this in this volatile market by December. I guess I will have to wait and see.
On a more important note: A happy Veteran's Day from one veteran to the hundreds of thousands out there worldwide.
On 25 October 2007, after doing my due diligence I finally picked up some shares on a pure momentum play and based on earnings at $30.02. The analysts were a bit disappointed with VASCO's earnings and valuations at the time, so the stock took an immediate tumble the very next day. Of course this sucked quite a bit and I was initially put off, but the more research I did the more I realized how this company has true worldwide exposure and are a true leader in their respective marketplace. I decided to hold on for the ride and watched it tumble down to the low 20's. On 8 November, I picked up more shares at $20.05 to shrink my cost basis realizing this was a great buying opportunity and that VASCO was being punished based on the overall marketplace not on the value of the company.
Now to the main point of my post. Today I took my first giant step into the options market by placing a covered call sale via my brokerage at Scottrade.
At first, I was a bit nervous thinking I was going to mess up my first options trade and end up costing myself a ton of cash. My main decision was what was my time frame and strike price for the covered call. I decided that since this was my first trade I did not want to space this trade out for many months, so I needed a strike price that if exercised would still allow me to earn a little profit. Based on my previous price points (mentioned earlier) I entered a sale for the December calls with a 25 strike price. My order was filled and I received a premium of $1.20. As you can see, I could have probably got a higher premium, but the NASDAQ started dropping this afternoon and I did not want to lose out on a trade just over a few bucks.
Lessons Learned: Don't get nervous it's just another trade, so it's not like I'm selling naked puts or calls where the risk is extremely great. All-in-all, I'm pretty happy with the trade and hope that the option does not get exercised because I still believe that VASCO will go higher just not sure if it will accomplish this in this volatile market by December. I guess I will have to wait and see.
On a more important note: A happy Veteran's Day from one veteran to the hundreds of thousands out there worldwide.
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