Hi Winston,
If you are THAT SURE that TECD is going lower you could short against the box. That is, go out and margin your entire portfolio by going short. That way you'll holding a long and short TECD position.
No really! The TECD chart does not look that bad at this time. TECD is still hanging around the 20-day moving average. Also, if you look at last year TECD moved sideways January thru the beginning of March. That must line up with release of the quarterly report. From March on is was a slow and steady rise.
Moreover, we know that TECD is bulding up warehouse capacity as we speak. That mean more profits!
If you have such a large lot, please Winston, start writing those covered calls my friend. You are missing out on VERY EASY monthly cash flow income STREAM! You could be cranking in 1point ($100) to 1 1/2 point ($ 150) per each out of the money call option contract (100 shares of TECD stock) .
Hey, sounds like you may have 1000 shares or more. That's $ 100 x 10 = $1,000 to $ 150 x 10 = $ 1,500 per month before commissions which would be peanuts (under $100). Now, check out your rate of return!
One point (1) on the current price of around $26/share is 3.85% rate of return for ONE MONTH! If you annualize that rate it's 3.85% x 12 = 46.15%. I would venture to say that you can actually make more than that by playing it closer to the edge and sell in the money calls. It is almost impossible for you to lose money Winston. Furthermore, this monthly profit is ON TOP OF ANY APPRECIATION in TECD value per share. That is having your cake and eating too! Now Winston, you mean to tell me if you had $1,000+ plus being added to your account EVERY MONTH that you would still be singing the blues? No, you would be jumping up and down like I am! I hate to lose money and I hate to see other people lose and NOT MAKE A PROFIT! It's the American way! Your investment in TECD stock means jobs for hundreds of people! You are indirectly putting food on the table and shoes on their kid's feet!
Winston, Winston! You have a gold mine money machine! OK! Consider reading this book. It called "WallStreet Money Machine" by Wade B. Cook. Sells for around $24.95. I read as many books as possible and this one REALLY supercharged my stock earnings that I can't even remember the last time I lost money. Just joking! I do remember and I laugh at myself because I know now how little I knew back then. So, I keep an open mind and keen objective view.
There is no reason why you could not be working your TECD stock by employing several techniques to shift YOUR RISK to TECD option speculators. Writing covered calls is like you becoming the Craps dealer. We all know that the HOUSE WILL ALWAYS WIN!
Remember this! If you are a long term holder of stocks and you are not writing covered calls, you are at the mercy of the major market makers, momentum stock players and the rise and fall of that stock price and you have no control of your risk and profit. You basically are wishing, hoping and praying that the stock goes up to make a profit and feel better about yourself. It is that EMOTION that will force you to become greedy or run scarced. There has to be a middle ground where you the small investor can get an edge! READ THIS BOOK! |
