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No there is a covered put under it, maintenance is $500 maximum. Both of the brokerage accounts I use only lock up $500 for each spread I am short. $15 - $10 = $5 x 100 shares = $500. You cannot lose more than $500 but you receive premium so it's even less. By the way, where are you getting that it's 2 years? The options are January 2012.
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Yes I made a typo. As you can see the percentage calculation reflects a return of $300 from the spread. I will contact SA and see if they can edit that to avoid confusion. Thanks for the catch.
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Etop, I use several brokers. It depends on what you are looking for I suppose. Do you want tools, price, fills, etc...? I use TDA/TOS for equities and options, OptionsHouse for large option orders, and OptionsXpress for futures.
The $8 credit was as of close Friday.. As of yesterday's close the net credit was roughly $4 for the May ratio... I assume there may be a chance to get in this morning (Tuesday) for slightly a higher net credit judging by pre-market...
A Detailed Options Trade for a Potential Apple Reversal [View article]
Apple is a great company, which is one of the reasons I didn't mind having the shares put to me for 200.. Not that I usually sell puts more than 60 days until they expire, but I am tempted to buy the July 200 put options and sell 2 of the July 190 puts against each one for a net credit of $220 per ratio spread.
A Detailed Options Trade for a Potential Apple Reversal [View article]
Thank you for the comment and sorry I have not got back sooner... Once the bearish pattern was voided on March 4, 2010 (near the close, when it looked like Apple would finish the day above the open price from March 2 - which it did) I decided to close one of the 200 put option contracts, and the 210 put option contract from each of the ratio put spreads I opened, leaving the same amount of naked Apple put contracts open as before just raising my break even point if the stock ended up trading lower. I took a realized loss at that point of about $80 per ratio put spread but assuming Apple closes above 200 per share at March expiration I will lose much less and just about break even (after commissions).
4 Earnings Season Option Strategies [View article]
Yes before commissions, however I pay flat $9.95 for all trades whether it's 1 contract or 2000 contracts through OptionsHouse... Check them out at: www.kqzyfj.com/click-3...
On Nov 07 02:00 PM TCK wrote:
> " even on eBay (EBAY), which sold off nearly 10% after earnings. > I was able to purchase back the put options (closed the position) > for a $4 per contract gain the following day. " > > > After looking at the the option prices, presuming this means the > profit was .04 per contract before commissions ?
4 Earnings Season Option Strategies [View article]
Yes, I took a quick beating on BIDU as it opened below my target price of 360; but just as I close the position on a large pop (as profit taking may occur in the next session(s)), I hold the put on a massive sell off with a stock like Baidu, I really don't mind taking ownership of (as stated in the article, is the key to this strategy), because buyers will most likely take advantage of the "new" lower price (as they did). Baidu is almost 50 points above the strike I sold with less than 2 weeks until expiration (not to mention the high theta just eating the premium away), and the position is currently resulting in a gain as of Friday's close. As stated in the post, these are all stocks I don't mind owning going forward, and if they get PUT to me, I'll take the stock at expiration and start cost averaging down by writing covered calls on them. Thanks for the comment.
On Nov 07 12:53 PM User 447425 wrote:
> You did not mention how thay BIDU earning strategy worked out for > you?
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On Jul 01 09:03 AM ScroogeMcduck wrote:
> I agree with you marco Ive been waiting anxiously for v to dip below
> 60
> A great buy!
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4 Earnings Season Option Strategies [View article]
On Nov 07 02:00 PM TCK wrote:
> " even on eBay (EBAY), which sold off nearly 10% after earnings.
> I was able to purchase back the put options (closed the position)
> for a $4 per contract gain the following day. "
>
>
> After looking at the the option prices, presuming this means the
> profit was .04 per contract before commissions ?
4 Earnings Season Option Strategies [View article]
On Nov 07 12:53 PM User 447425 wrote:
> You did not mention how thay BIDU earning strategy worked out for
> you?