Steve: Re your post about AGPH options.
IMO there is good money to be made in AGPH options right now by selling premium. Last week I warned against selling puts and calls because of the ICAAC conference, which I felt would increase volatility. (It has.) The historical volatility for AGPH is .56 (per ETRADE), and last week the options were selling with an implied volatility of about .59. (For those who care, the higher the volatility number, the more the stock moves around on a percentage basis, and the more expensive the options are.)
This week, with the ICAAC news roiling the market for AGPH, the implied volatility has moved up to about .70, and the options are very expensive. Don't buy puts or calls now, IMO, unless you are the legendary billkern or some other person who somehow knows which way the stock will move in the next few days. They are too expensive.
IMO, this is, as you say, a good time to sell options. After the conference and the earnings report, volatility will probably come back down from the unbelievable to just the normal very high. This will result in option premiums shrinking.
I'm a coward. I like to sell in the money covered calls that expire in a few weeks on undervalued stocks. That's because I'm new to these biotech stocks and can accept 100% annualized returns that the old timers sniff at. |
