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Strategies & Market Trends : Option Strategies -- Ignore unavailable to you. Want to Upgrade?

To: Jim P. who wrote (1759)	8/31/2016 10:28:19 AM
From: alanrs	Respond to of 2591

I've traded POT since 2008, although not at all for a few years in there. Currently own 200 shares put to me at 25 some time back. That's less than the amount I've extracted from it, house money if you will, although that's not a particularly healthy way to think of it. It pays a dividend and is unlikely to be obsoleted by the next new thing, I've got time and cash doesn't earn anything. I have no opinion on what its 'true' value might be. Similar to JOY. ARS

To: Jim P. who wrote (1759)	9/20/2016 3:03:50 PM
From: Jim P.	Respond to of 2591

Well, Potash trade in the red. Options expired on Friday so basis now about $17.30 Sold covered calls with a 9/30 expiration or less than 2 weeks for 20 cents and a strike of $16.50 Sold cash covered puts for 9/30 with a strike of $16 for 29 cents for 1/2 of the amount of the covered call position. Basis will be lowered to a blended $16.65 so risk of 6 weeks of lost option premium to bring down the basis and increase of my position by 1/3 if it is below $16.00 If the stock is above $16 in 2 weeks then my basis is $16.95 and if above $16.50 then I will have lost 45 cents on the combined trades. I think 2 weeks to lower the breakeven of the trade is a good choice for me here. It will make the $17 strike profitable for covered call writing or possibly use the $16.50 strike to bring basis down below that number in another 2 weeks. I like the proposed merger combination and for the longer term will own some of the combined company if the merger goes through. jim