A week and a half ago I shared a trade idea with you guys from ONN.TV. They recommended selling puts on MJN at the $45 strike with December expiration. Just to test the idea I sold one contract at $3.70. I closed the position this morning for a profit of $110 buying the put back for $2.6.
I will continue to look at their trade recommendations, but one thing I will do is learn a little more about the company before I jump into it. As I kind of jumped into this one pretty blindly.
On Monday after the market close I will write a post to summarize my trade activity for the month of November and what positions I am still holding.
Hope you all had a great Thanks Giving.
Dominic
As you may recall this position was a position alert from ONN.tv. I wanted to try it out and see how it turned out. I actually covered my position on the 27th of November booking a profit of $110. This monrning I got the following update from ONN.tv saying they were now covering the short puts and rolling them to another month for basically break even. This is just another one of those gut moves, I felt like the stock ran out of gas in the mid $44's. So I took my money and ran. But none the less, I like the updates that ONN.tv provided on the position. I may look to put on the adjustment trade with one contract again. See below:
ReplyDeleteNOTE: This is an update to an existing position, originally published on November 16th. Please scroll down to the “Trade Management” section for instructions.
Trade Management
December 7th:
Due to the passage of time, the December 45 puts have moved toward parity. Despite the stock being down since we have entered this trade, we are not down much money on the option position. None of the fundamental bull case for MJN has changed.
At this time, we want to buy to close the December 45 puts and sell to open the February 45 puts. Place a limit order of $1.40 or better (that is, the credit collected for the spread should be $1.40 or more). For example, you could buy the December 45 puts back for $3.80 and sell the February 45 puts for $5.20.