APWR: Weekly close above 7.75 and it has held above 7.75 so far. Looking to possibly add max 2/3 to 1 portion of current holdings. Last Friday i attended an interesting dinner at a local association formed by the local stock exchange and former floor traders, and thereafter had a coffee with a veteran of the trading floor, who gave me an idea on options.
Instead of a covered call (long stock + short OTM call), or married put (long stock + long OTM put), why not long stock + short ITM call for front month (synthetically equivalent to married put)? So i sold the equivalent of Aug 2010 strike 7 call option for $1.10, and collected a small portion of time premium $0.20. Did the same for LVS, opening both stock and option positions simultaneously.
Current positions:
APWR: Long 7.27, short Aug 2010 strike 7 call for $1.10. Extrinsic premium $0.20
LVS: Long 23.08, short Aug 2010 strike 21 call for $3.15. Extrinsic premium $1.07
No entries on current watchlist, will stay out for rest of week and prepare plan for next week after 16 Jul options expiration.
Watchlist:
RIMM: Breakout last Fri above $51-52 on higher than average volume. May test $58 to cover the gap, which coincides with 50 EMA.
BP: Tested the 20 EMA before continuing its up move. No retracement, so did not enter long position.
C: Closed above $4 last week, and continued up. Volumes are not higher than average (14 EMA)
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