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Strategies & Market Trends : Humble1 and Swing Trading Friends -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (24970)	12/19/2016 10:40:06 AM
From: robert b furman	Respond to of 41020

HI john, I all but always write puts on a stock and use cash to collateralize the write. Id id have a naked call on HCP - this resulted on an attempted hedge for the puts I had sold. During the drive for high yields, HCP had run up so far, I bought to close all of my puts and did not buy the call back (which was a 4000 loser at one time). I knew HCP was going to announce their spinco spin off of the skilled nursing facilities before year end and I believed they would also have to cut the dividend. After the spinco was ambiguously announced HCP dropped from 44 to 33 and I bought to close the call too early and absorbed a $281.00 looser (with a smile on my face) 2 days later it would have been a winner - I was still smiling. LOL When these dividend Aristocrats cut their dividends - many stockholders sell first and think out the position later - it usually is a blood bath of significant proportions. There in lies the opportunity to buy back HCP with out there errant acquisition of skilled nursing facilities. If at a reduce dividend - I'm hopeful the new dividend will cause a drop in the HCP stock to offer up a 6 %. If so I'll re buy the stock - consider it an excellent long term hold and then double down selling puts far out into the future. The fear premium in the puts should cough up a 12 - 18 discount on the stock as iy falls down to the 6% -7 % yield range. This is all conjecture on my part - but also based on a study of the Ventas REIT (VTR) who did excatly the same moves earlier in 2016. They seemed to have seen this government payments reduction coming much quicker than HCP did. As a side note VTR's spinoff has now been bought up by a hedge fund. Not sure if that is delaying HCP's announcement or if they wait to announce it the friday evening before Christmas or some under the radar moment. I very much like HCP's properties and leasors in California - great locations near universities / research and companies like Amgen. They are a very high end location type of REIT and I think that is a mismatch with skilled Nursing Facilities that rely on government payments for care of the elderly. The boomer will cause a nice growth of business,but they must get paid by a government that will pinch pennies to preserve what is more than likely not properly fnded (medicare). Thus the exit. As to working the trades tation account - would greatly value what spreads fx etc I should begin to get familiar with. As always greatly value your views. Bob