M.B.,
I've been enjoying the dialogue/diatribe that you've stimulated in SI over the past several weeks on various forums! I've been long this market all year, and am still down about 20%.
(My biggest positions are IDTI, TER, LRCX and GVIL - my costliest mistakes have been MU, SGI, GVIL and LRCX).
I see another downturn in the market soon and would like to take advantage of the rally to buy some puts. Would you give me your picks and pans among the following?
1. Dell Nov 45's (DLQWI), 1 3/8 bid - 1 5/8 ask
2. ATML Nov 25's (AQTWE), 1 1/8 bid - 1 5/16 ask
3. MU Oct 17 1/2's (MUVW), 5/8 bid - 3/4 ask
Of this group, have I picked good values in terms of time and strike prices, or would you suggest other combinations? I believe I read that you have some Sep 17 1/2 MU puts, but they aren't all that much cheaper IMO at 7/16 by 9/16.
If I had a total portfolio value of $50,000, is there a rule of thumb on how much $ would be "appropriate" to direct toward puts? Would it make a difference in your answer if a portion of my long position were already on margin? Finally, if I were to earmark $1,000 for buying puts, should I buy in 1/3's in case the market moves against me?
Thanks for your perspective, I really look forward to your thoughts! |
