Sold CRM 110 Calls into the rip today. Strong resistance right around 110 level. Stock actually traded poorly in the am only to be lifted by the overall market. Sold them @.35 for Friday expiry.
Buying some YHOO stock here as it trades down with overall market. Stock has held up well in the last month or so with constant chatter of takeover, investments, etc.
Sold Dec 60 NFLX Puts today @ .35. Stock act well past couple days after CEO speaks at conference. Expiry next Friday.
Stock closed @ 70.89 today.
Sold NFLX 75 Calls @ .55
Stock is going nowhere fast. Trades poorly in an up market. Popped a bit yesterday when a silly rumor emerged that Facebook might acquire them in 2012. Not likely, especially with Facebook planning to go public next year.
Option expires December 9th.
On the market rip today I sold CRM 120 Calls with a Friday expiry. at an average of .55. The stock recently got crushed when earnings disappointed. There is resistance right around the 120 level, so I chose that as my strike. Not sure that I would sell the 120′s for the regular December expiry. These stocks are all over the place these days, which makes for rich premiums, but those premiums sometimes come at a price. (See my LNKD Puts that I had to cover…LNKD was much lower today in an way up market). Discipline is key when selling options.
Update- the option expired worthless today, however, I covered my position yesterday for a small loss when the stock made a run at 120. As this was strong resistance, I thought best to cover and manage my risk. 120 was my line in the sand and I traded my plan. Lack of discipline cost me dearly in the past. Now I have no hesitation of closing a position if it doesn’t go according to the plan I laid out upon trade entry.
On Friday I sold December 50 LNKD Puts @ .90 (expiry Dec. 17)
Linked In recently completed a secondary and the stock actually traded higher. Yesterday, it gave back most of those gains, creating an opportunity sell some puts at a decent premium. The stock closed the day @ $72, down nearly 4% on the day. I tend to sell puts only when the underlier is trading down on the day, opposite for selling calls…(only when stock is trading higher).
There is good support at $70 and the 52 week low is 60.14. If the stock does not hold the 70 level, I will re-evalute to determine my risk tolerance. Nowadays, with the market trading mostly on headlines, traders have no problem crushing stocks with not much reason. Shoot first! (eg., GMCR, CRM, NFLX)
11/25 – UPDATE – covered today @ .90 flat. looks as if the lock-up period, along with all the negative attention on the highfliers (CRM,GRPN, etc.) is catching up to LNKD a bit more than anticipated. will re-enter when the stock shows signs of stabilizing.