This morning I sold some puts on two different stocks and each with a different expiration date
1. with NFLX (Net-flix) trading around 169 I sold 30 of the Nov. 19, 125 strike I received 1195 for a return of a little over 3%
2. I also sold some AAPL (apple) puts with an expiration in one week
10-29-2010. With AAPL trading around 307 I sold 20 of the 280 strike. I received 340.
Rational behind the moves.
1. With NFLX trading around 169 I sold the 125 puts. These expire in a month so there is some waiting with this position. My plan is to roll up (move to a higher strike) as the time factor withers away. I feel with NFLX just reporting great earnings, they won't fall 44 points during the month.
2.With the AAPL puts, the return isn't super but I can do that (or better) each week all year. With AAPL trading around 307 and just reporting great earnings, I don't think that it will fall 27points during the coming week.
On Monday when the weekend shakes out, I will try to find some more moves that both bring in some income and let me sleep at night (or day)
Good trading all
2 comments:
Jerry,
After nflx posted great earnings,i see that you opened a position today as oppose to yesterday... What is your reasoning behind this move? I sold options yesterday, however it seems like I would have received more of a premium today if I had waited a day. Thanks
The main reason for waiting was to let earnings come in from AMZN. There were a few others reporting and I didn't want to jump in to soon. As I've mentioned, I fight the patience problem so I forced myself to wait out this volatile time. I am Waiting for Monday to sell some more if there are positions out there that I like and feel safe with. Thanks for the question.
Jerry
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