Well, sounds like you've done very well so far...
For myself, on RMBS, I'm just trying to test "time elements" of option, that's all.
In this testing, my potential gain comes from premium only.
I don't care about the underlying stock's potential upward gain.
From looking at RMBS's past 5 years of monthly price movement, (historical data is the only reference I have, so I'm just assumeing this stock will behave similar in the future, which is VERY volatile), I expect about half the time I'll get to keep "FULL premium", and about 4 months, breakeven and 2 months - I'll get creamed.
So I'm thinking weather to buy puts with 20% to 30% below strike price to protect from those 30% plus tanking months...
(With RMBS at 25.3 right now, May 20 put is only 0.30, compare to May 25 call 2.0)
I will not post here other activities, but last Friday, I bot 1,000 LEXR and 1,000 FDRY to test same thing. LEXR tanked bad so thought it was good time to get in, sold May 10 LEXR CC. But the limit sell order of FDRY May 17.5 at 0.85 wasn't taken so couldn't sell last Friday.
Thought I should test with at least 3 stocks & CC to compare.
Did you have a good weekend?
I planted 2 fruit trees today, peach and persimmon, and reshape and cut few grape vines...
Jon |
