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Strategies & Market Trends : Calls and Puts for Income

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To: dealmakr who wrote (5633)1/8/2013 3:41:32 PM
From: Bocor  Read Replies (1) of 5891
 
Selling puts when you have a volatility spike will allow you to take in more premium for the risk/reward strategy.

By looking at a chart and doing some TA along with the FA you can see if the stock has support or is breaking up or down.


Well, using that theory I sold the Jan. 72.5 BA puts, thinking it was close to the 38% retrace of the Sep-Jan rally and its 50 day ema at 74.58/74.37. Got a decent premium for my wait, however the stock subsequently dropped into the 73's, so we'll see. Either way, BA is volatile enough that I will probably take the assignment since I can get rid of it on any good news announcement.
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