Uncle Bill

Miracle: Bush To Part The Bankrupt Sea

Good comment, Al Rob. How could the editors let this bit of nothing on the site? Tuesday would have been a good day to establish buy/writes on those stocks you mentioned. Where were you then? Check me at impliedrisk.blogspot.c... for timely, useful commentary. Plus, you were wrong. Countrywide (CFC) barely budged. Too late too sell any high-cost premium. Thanks.

Selling Bank of America Puts Is As Safe As It Gets

Five months to make $1.30 on a $40 stock? Look at it the other way. If you bought the stock at $40 and had to sell it at $41.30, would you think you made a good trade? So far, BAC has held in pretty nicely. don't you understand that if there is more selling, these stocks that still have value will be the ones to go? As bad as it was today, the homebuilders (HGX) and the REITs (DJR) fared better the other sectors. At a 25 implied volatility like today, the expected six-standard deviation trading range for BAC over the next 90 days is 15 points. Right now, BAC is within 1/2 standard deviation of its 90-day mean. In other words, you've traded about 6 points of possible risk for 1.3 points of possible gain. You need to wait until the stock realizes as mich of its risk as possible before selling puts on an issue. This stock doesn't qualify.

Bill Yates
impliedriskreport.blog...