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Trade Update: Doubled my position in this trade today. After thinking about it more this seems like such a safe bet that now I wish I had taken a bigger position.
Doing a little research on AA this morning, ran across this article that talks about AA as well as JPM. With futures down this morning will look to sell more AA puts today.
Trade Update: Rolled these down and out to April 7 puts, for a small credit. The delta on the Dec options is still not too bad, 0.29, but since I sold a lot of puts I want to minimize my assignment risk and I wanted to make sure to do it when I could still make the trade for a credit. April 7's currently showing delta 0.16
Pretty much except it doesn't expire. I think the 5 year low on AA is something like $4 or $5. I'm thinking if the worst case scenario turns out to be buying at $7 the risk should be low I hope.
End of month update: Trade currently showing loss of $1072. Total position is short 200 April 7 puts. Max gain if these expire worthless will be $5527, currently showing 76% chance of that happening. Will update again in April or if any adjustment is made before then.
Trade Update: Doubled my position in this trade today. After thinking about it more this seems like such a safe bet that now I wish I had taken a bigger position.
ReplyDeleteDoing a little research on AA this morning, ran across this article that talks about AA as well as JPM. With futures down this morning will look to sell more AA puts today.
ReplyDeletehttp://seekingalpha.com/article/308256-5-stocks-cheaper-than-their-book-value?source=yahoo
Trade Update: Sold more Dec 9 PUTS for $.19. Final position is now short 70 of these puts for $0.19.
ReplyDeleteTrade Update: Saw the puts up to $0.20 so sold 30 more. Now I'm really done - short 100 puts for $0.193. Buying power effect currently ($11,050).
ReplyDeleteTrade Update: Rolled these down and out to April 7 puts, for a small credit. The delta on the Dec options is still not too bad, 0.29, but since I sold a lot of puts I want to minimize my assignment risk and I wanted to make sure to do it when I could still make the trade for a credit. April 7's currently showing delta 0.16
ReplyDeleteAt $7 you're getting close to the equity being like a call option.
ReplyDeletePretty much except it doesn't expire. I think the 5 year low on AA is something like $4 or $5. I'm thinking if the worst case scenario turns out to be buying at $7 the risk should be low I hope.
ReplyDeleteEnd of month update: Trade currently showing loss of $1072. Total position is short 200 April 7 puts. Max gain if these expire worthless will be $5527, currently showing 76% chance of that happening. Will update again in April or if any adjustment is made before then.
ReplyDelete