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Conservative option strategies, what did you buy or sell today?
(01-15-2021, 04:02 PM)vbin Wrote:
(01-15-2021, 02:57 PM)Binary Wrote: MAC 7.5 short put expires worthless today. Sold a MAC FEB 10 put now.
Closed a Jan22 T 26.5 short put with a nice profit and sold a Feb12 T 27 put.
My GPS short call expires ITM today so I can finally get rid of my 100 shares at a small profit (on top of all the option income)
Have you done any research on mac for a long position?

Sure I have Smile I am long MAC, the fair value is well above 10 usd in my opinion.
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Sometimes you just get a stock that keeps working for you. VSTO isn't too risky in my mind but option premiums are good enough to make it an attractive way to play it. I'm comfortable going long at 25 or less for a year or two hold. I've been selling 30 days options since September on VSTO.

In DEC sold FEB19 Strike 20 for $229. Option had 60 days to go. Option still has 30 days to expire and bought it back today for $31. It made no sense to hold it.

Same date I also sold a FEB 19 strike $17.50 for $124. Bought to close today for $21.

With positions closed I sold a strike 25 and a strike 22.50 with the same FEB19 expiration. Collected another $190 total.

This is pretty good mileage out of a low amount of capital. Before this I was selling them a little farther from the money and collecting about $110/mo per contract. Now if I can get one more dip because I only own 35 long shares so far. If the strike 25 will get in the money I can sell more puts where I'd really like to enter long. I suspect earnings will be too solid for that to happen.

This is how I prefer to enter a stock when things go well, with multiple option sells. A lot of times they run away of course and you're left sitting on your hands. I need a few more low dollar stocks because most of my efforts are more conservative large caps.
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That is some rich premium from a "cheap" stock with low IV.

What's interesting is, I pulled up VSTO chart and laid the "abovethegreenline" parameters on it and WOW, one could have sold calls in downtrend and puts in an uptrend w/o an assignment for 5 years.

Was an eye opener for me, will continue to explore.
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(01-19-2021, 07:55 PM)NilesMike Wrote: That is some rich premium from a "cheap" stock with low IV.

What's interesting is, I pulled up VSTO chart and laid the "abovethegreenline" parameters on it and WOW, one could have sold calls in downtrend and puts in an uptrend w/o an assignment for 5 years.

Was an eye opener for me, will continue to explore.
I track them fairly close and can give you my thesis FWIW.  I would not call myself a gun nut, but retired military and my family target shoots.  Obviously we have political uncertainty for the foreseeable future.  "Gun huggers" start hoarding EVERYTIME they get worried.  Very cyclical charts that align with regime changes, social unrest, school shootings, and the subsequent rhetoric from politicians.  It's just panic buying.  It will happen but you might wait a year or two if you have a bad entry.  Around JUL I became convinced that Biden had a chance, and at the very least an election close enough to drive fear.  Anyway I started tracking/trading Ruger (RGR), Smith and Wesson (SWBI), and Vista Outdoors (VSTO).

The pure gun stocks have flown high of course.  I cashed out and the risk/reward isn't as good from here IMO.  They are however conservatively run and both RGR and SWBI may be totally debt free this year.  That's not a bad place to be and I will watch for a had dip. (and sell CCs if I get shares).  It will come eventually.  Ruger still has a four month wait list to get a common pistol.  I know that because I tried to order one for a Christmas present.      

VSTO may run with the gun stocks but I see a level of security for the following reasons.  They sell ammo which is frequently out of stock for popular calibers.   When gun enthusiasts get scared they empty the shelves.  When it gets too cheap they buy some more because they it will spike again when the mean DEMs come after my guns right?  Ammo hoarding is a obsession but we never know when the zombie apocalypse is coming.  Smile  VSTO just picked up Remington ammo when the brand went BK.  They now own a large % of the major brands at all price points.  They also own the best brand accessories like optics and cool Hollywood looking stuff.  They own some better brands in camping cookstoves and other outdoor sports.  What they don't have is a high exposure to stuff that could get restricted by the GOV.                                      

Don't forget we have a 6-3 SCOTUS.  I am not a bit afraid anything real happens and not afraid to own VSTO for years if necessary.  They will no doubt get hit when gun stocks do.  The company is still fairly valued and I will be highly surprised if they don't blow away earnings for at least a few more quarters, if not years.  I will watch their debt and hope they pick up some more yard sale pricing on quality brands.  I hate to make price targets but mine has been 33-35 for 2021 since they were trading at half that.  Seven analysts follow them and none of them are unconvinced.  I am really hoping some political chatter will scare the SP down before spring earnings.
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Sold T 30C 19/FEB for $40

Sold KO 50C 5/FEB for $34
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