User 305589

Fuel Your Portfolio with These Option Strategies

I suspect that seasonality may not be as reliable this year. A lot of money has already piled into oil and metals in anticipation of an economic recovery AND of the usual seasonal trend in oil. So, oil may still peak in July, but may have little upside left from here. And, since oil stocks usually lead the price of oil, your play could turn pretty bad with a vengeance. Oil stocks are very overbought and could easily correct by 20-30% short term. Imho, it is not worth the risk to play that kind of strategy right here right now. the lower vix (and lower call premiums) don't help, either.
There are much better ways to make 6-10% over the coming 6-7 weeks than your covered call plays. their risk-reward is simply not worth it imho.

Option Spreads With Large Upside and Limited Downside

hm, let me get this straight: you talk of 'large upside and limited downside' - yet when looking at your vertical call spreads that you suggest, you have an upside of 108-150% and a downside of - 100%(!!)
I am myself doing a variety of vertical call spreads as well as calendar spreads, but frankly, your suggested trades look more like a gamble.
Your strike prices are so precariously close to each other and at the same time mostly out of the money and pretty near to expiration. For instance, the SPY calls with 92 strike have only a slightly higher probability of expiring in the money than have the 93s. It's basically a coin toss, imho.

I do like call spreads, though, but I use them either with long term options for stocks that are grossly undervalued imo, and then I go quite deep out of the money for 3.1 or 4:1 upside/downside.
Or I may target stocks which I consider to be a t rock bottom valuations with very little downside left and then chose calls that are in the money while selling calls at or slightly out of the money.

Why Is Oil Trading at $53 When Supply and Demand Is So Bearish?

rig count for nat gas has fallen more than 40%. you just can't shut down a well overnight. a 45% cut is a hefty one, no? CHK estimates it may get down to a 60% cut in rigs by q3/q4 this year.
I am bullish for selected nat gas companies but unfortunately, a glut of Nat gas is inevitable for the next 9-18 months given the huge supply of LNGs hitting the market. CHK has hedged very prudently (I think the company is heavily underrated by the market) while many others have not. MCF is a low-cost producer that will survive and then thrive as well. But i expect no short-term catalyst for nat gas stocks.


On Mar 24 09:14 AM long_on_oil wrote:

> When the price of oil was high the oil companies tried to maximize
> profits by drilling new wells and increasing supply. Now that the
> price is low the opposite will be the rule. The stockholders must
> demand profit maximization irregardless of the price of oil. This
> is just business 101.
> Why the natural gas companies aren't cutting production is beyond
> me. We stockholders should be writing our management to insist they
> cut production to protect our investment. We are tired of giving
> our product away. No responsible management of any successful company
> operates like these natural gas companies.

Four Oil Giants to Keep an Eye on - Barron's

why the outlook for cop is said to be 'not so good' while on the other hand recommending a high-cost, state-owned company like petrobras really beats me.
how many billions pbr will sink into the newfound big but highly difficult to extraxt oilfields is anybody#s guess. In any case, hey won't make money on those as long as crude stays below 70. PBR a buy?? Please!