Aloha Amy, Re : "Thread, let's get a strategy discussion going."
Here are my thoughts:
It's not necessarily your strategy, IMHO, that made you the money (through increase in number of shares and cash position) as much as your prediction about how the market will behave and then investing accordingly. You probably wrote/bought options predicting the behaviour of the market (tied in with other investment decisions like you would like to hold on to stocks long-term, etc). You are taking risks in any sorts of investment, even collars or covered calls by giving up loss in profits, if the stocks shoots up or down dramatically.
Having said that, in general, 'time' will buy you money. Here's what I am considering doing :
I expect the market to not drop significantly from this point on. For companies like CSCO, SUN, where I dont see much of a downside, I plan to sell puts about a month out and strike price 10-25% below the current price. For Intel and MSFT, I think there is more downside in the short term, I would probably write covered calls one month out just on the money. I might do that until June (since I expect Q2 to be bad). All bets are off for July and beyond for me at this point.
Maui. |
