Options trade

[TJMAXX]

This place is damn boring. Here's a trade I made today --three weight in PC speak-- 5% br max if covered by the short, 3% otherwise:

Sell GE $5 March Put (GEWOE) @ .44c

GE is fucked and will be brought down by their AIG-like finance company (see Grant's from last Oct recommending a short). We're going for a falling knife and selling short term volatility.

Look for a small bounce tomorrow (hopefully), but will sell short a move to $6.5 and above, otherwise sell an amount equal to 50% of the option amount to protect the downside.

[Dunbar]

This place is damn boring. Here's a trade I made today --three weight in PC speak-- 5% br max if covered by the short, 3% otherwise:

Sell GE $5 March Put (GEWOE) @ .44c

GE is fucked and will be brought down by their AIG-like finance company (see Grant's from last Oct recommending a short). We're going for a falling knife and selling short term volatility.

Look for a small bounce tomorrow (hopefully), but will sell short a move to $6.5 and above, otherwise sell an amount equal to 50% of the option amount to protect the downside.

You've sold a put. So you sold someone the right to sell you GE at $5 on Mar 21. I don't see how that is consistent with your feeling that "GE is fucked and will be brought down by their AIG-like finance company (see Grant's from last Oct recommending a short)". When you are selling a put, you want the underlying stock to stay the same or move up, no?

Maybe I don't get your short-term plan.

--Dunbar

[TJMAXX]

Correct. In Oct it was in the low 20's, and the market has responded accordingly... Fear mongering may bring the stock down further, but I'm hoping the short term downside limit is $5 (or at least $4.56...) the next few weeks.

I'm bearish on the stock until they come clean, but believe the recent fall is too much too quickly-- implied volatility spiked today with the capital raising bullshit and credit rating concerns (triple A is really no big deal) and I further believe Buffett will step in with addnl preferreds before the specter of equity dilution is raised and the stock gets killed. Short term value here imo.

[TJMAXX]

no short sell for the GE: we'll let it ride for now.

Sell GLD APR-09 $80.00 PUT (GLDPB) @ 1.0 -- 3 weight --

[Rudy1957]

I like the GE play -- with such a low-priced stock, your risk is truncated.

Good call so far on the gold, too. The math on gold options is way different than that for stocks. The big instamoves in stocks are usually down, but in gold they're usually up. So naked puts aren't as dangerous.

[TJMAXX]

Good call so far on the gold, too. The math on gold options is way different than that for stocks. The big instamoves in stocks are usually down, but in gold they're usually up. So naked puts aren't as dangerous.

I'm not so sure about this statement (GLD/others are pricing quite a bit more volatility in gold than the interest rates suggest)

Go naked or go home!

[Jeff Jones]

Look for a small bounce tomorrow (hopefully), but will sell short a move to $6.5 and above, otherwise sell an amount equal to 50% of the option amount to protect the downside.

For the love of God, you just have to shut up.

Now what? I guess we have an investment plan for tomorrow. LOL.

Back to Jeff's sports gambling plan.

Just fade everything you have every heard from anonymity on a gambling website. We realize everybody on the Internet is an anonymous genius gambler, and we should follow them.

LOL. Nooooo.

My initial recommendation would be not to gamble on sports at all. My followup resolution would be not believe a word you hear regarding sports gambling on the Internet.

Call me crazy.

[TJMAXX]

woah there cranky old man. I've got a 2-1 value meal discount at Wendy's you can use for that lunch you owe me.

These are real trades, i'd be happy to show you printouts for your inspection. lol.