RE: various option plays
"On Thursday, I'm going to buy Jul 15 calls..."
"On Friday, at 15 mins before close, I'm selling all options..."
<< it sounds like you're playing the "spike up at 20" that you expect. >>
ABSOLUTELY TRUE. I have found over and over that with options,
Myopia serves me well.
I NEVER take an option position based on events that will occur more than 30 days out.
One of my favorite people is US Grant,
he always fought the battle in front of him and
never worried about what was on the other side of the hill.
I'm playing the spike in front of me,
and the profit taking on the downside.
I'm not even thinking about any GMGC event after July 1.
<< ...but, if you wanted to play the product release on July 30th,
and you had a plan that called for buying the August calls,
on Thursday...
would you still buy the 15s ?
or would you buy another strike for that purpose ? >>
You are over thinking the situation.
You are worried about what's on the other side of that spike.
Bad thinking for options; a lot can happen in the meantime.
What if the fed raises/lowers interest rates...
what if GMGC announces a delay?
what if Clinton is assassinated?
Focus on what is in front of you,
not the big picture.
The big picture has too many variables, and you'll never make a decision.
Also, longer term options carry too large a time premium
(which dissappears as the option becomes more valuable
and dissappears as time becomes shorter).
Stay with the July 15's, they'll make the largest % profit.
Sell them at a profit, and then decide what to do next.
Good luck. |
