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Teddi, would you suggest a roll or hold of the May 22 puts at $76.50?
Amy
Teddi, In today’s article, you mention selling puts on DUK, June strike $72.5. I STO on May 13 the same strike, as did a few others, @ .79 based on a suggestion you had made. I can’t find it specifically, but it was mentioned above. Are you suggesting an additional position today?
Thanks for clearing this up!
Amy
teddi,
have you updated ur market trend section of the website?
are you still holding those calls?
“Since the high made December 29 the market is up just 30.34 points but it is up.”
I think all or most of our portfolio returns should speak to what we have learned from being here.
Again,
Thank youAmy
Kikbib. Many of us here have a lot of empathy for your situation. I have been there with other trades. That is why I religiously employ a trailing stop loss on positions held, ALWAYS. Amy is correct, that gap will eventually be filled. And Teddi will likely have a good solution for you. Below is just my humble idea and may or may not work for you. I used it to exit a poor trade of mine recently.
Yes, You don’t want to own GMCR, but you do. So, evaluate the fundamentals, B/S, sales, P/L, as well as the technicals, Charts, etc. to determine that the $90 support you suggest is there. I also think that it is.
Then, here is my offering: (all data based on Friday’s closing #s)
You own 200sh @ 124.32 = $24,864
Average down; purchase 200sh @ Friday close price 94.26 = $18,852.
You now own 400sh tot cost $43,716 = $109.29/sh (15.9% market loss vs 24.2% your current mkt loss)
Friday close- GMCR Sep call strike 105 bid/ask mid price = 4.40
Sell 4 cc @ 4.40. Your ave. cost now = 109.29 – 4.40 = $104.87.
If GMCR hits $105 at Sep, you’re out. If not, do it again:) True, you are at the mercy of the marketplace for 125 days, but with your current holding, you still have that exposure. And I recall a post by Amy a few days ago where she finally closed a position in AGQ with a profit after selling calls for TWO years. To me the above method, in this situation, is a better allocation of funds than trying to recover via NPs. Just my humble opinion.
Frankly, I have some trepidation about GMCR, but I also am getting assigned from ITM puts from last Friday, so will be trying to work it out, also.
Good luck….maybe we can commiserate together, work it out together and celebrate, when we successfully triumph in the trade!
Mike PollardOne thing I can say is that I have a real belief I the fact/concept that upside gaps get filled, sooner or later. There is a gap from when KO said they were taking a stake back in early 2014. I would check that gap out before making a lot of decisions. JMO
Amy
Dough.com has a screen for high ivr. Ideally, if you can find a stock with high ivr and relatively low price, you have an advantage with the high octane covered call strategy, i believe.
It worked for me with csx and kmi for instanceI would suggest you email Teddi directly on this one. She will have the best ideas. I have played GMCR successfully only through luck, but with this news, and Cramer’s call for a $70 price target, I don’t know which solution would be the best, but Teddi will.
Amy
Great job! AAPL is a great stock to sell puts in. I would suggest hammering down a list of stocks you are comfortable with like AAPL. Teddi’s list is a great start. Companies that you wouldn’t mind owning and you also can see the major support/resistance levels so you can be alerted to when a good opportunity arises (e.g. I have sold several puts every time JNJ dips below $99).
STO XBI JUNE CALLS STRIKE 240 @ 2.20
Amy
Any good ideas about stable div payers with racier IVs?
Pablo, Generally the higher the IV, the greater the risk, lol
What I would/could suggest and what I have been doing is buying good dividend stocks, like KMI for example, sell CC, and then if it doesn’t hit the mark, you can sell more CC, all the while collecting the divvy.
I also have GM puts expiring tomorrow at $35. If I get assigned, I will be selling calls on GM too, or if close enough maybe wait to sell it. Not sure yet.
I have been doing that with BGC for months, netting an average of 1% a month, plus the 4.5% dividend. I don’t reinvest the divvy because I don’t want to be left with a small fraction of a stock. I have 6 shares of POT, 42 shares of ABT, etc.
Hope that helps.
Amy
Teddi,
Did you make an error in saying “The Slow Stochastic is also negative and is nearing oversold.”
The chart seems to show XBI closer to an overbought condition, no?
Amy