http://mytradersjournal.com/stock-options/2008/03/03/more-vip-options/ Investing in Stocks Through Options Sun, 20 May 2012 05:09:47 +0000 hourly 1 http://wordpress.org/?v=3.3.2 http://mytradersjournal.com/stock-options/2008/03/03/more-vip-options/#comment-2431 Alex Fotopoulos Fri, 07 Mar 2008 04:08:51 +0000 http://mytradersjournal.com/stock-options/2008/03/03/more-vip-options/#comment-2431 I agree that VIP is a good company and I started my position by selling naked puts so I could get into the stock if/when it came back below 35. Once I saw it moving down instead of up I decided not to fight the masses in their push to make VIP decline, but to profit from it. Good companies do not always mean good short term (<2 mos) stocks. I sold the calls as somewhat of a hedge to my puts and a way to squeak out a little more profit from a stock I was already tracking. This market is screwy enough right now that I don't think (maybe more of a hope) that VIP could come back that high before I could get out. With options sold on both sides and the range of $35-40 as full profit, I think I'm not even being terribly risky. The delta of my VIP position is at 29.60 at closing on 3/6: +102.80 from my puts and -73.20 from my calls. As I mentioned a few weeks ago (I think while discussing this same type trade on VIP last expiration) I follow Delta on my options and only sometimes actually use it to influence my trades. For now, I'm trying not to be completely delta positive like I was almost all of last year. So far my adjusted stance is working. I just wish I had started this before the January smack down. I agree that VIP is a good company and I started my position by selling naked puts so I could get into the stock if/when it came back below 35. Once I saw it moving down instead of up I decided not to fight the masses in their push to make VIP decline, but to profit from it. Good companies do not always mean good short term (<2 mos) stocks. I sold the calls as somewhat of a hedge to my puts and a way to squeak out a little more profit from a stock I was already tracking. This market is screwy enough right now that I don’t think (maybe more of a hope) that VIP could come back that high before I could get out. With options sold on both sides and the range of $35-40 as full profit, I think I’m not even being terribly risky.
The delta of my VIP position is at 29.60 at closing on 3/6: +102.80 from my puts and -73.20 from my calls. As I mentioned a few weeks ago (I think while discussing this same type trade on VIP last expiration) I follow Delta on my options and only sometimes actually use it to influence my trades. For now, I’m trying not to be completely delta positive like I was almost all of last year. So far my adjusted stance is working. I just wish I had started this before the January smack down.

]]> http://mytradersjournal.com/stock-options/2008/03/03/more-vip-options/#comment-2430 iio Fri, 07 Mar 2008 03:49:06 +0000 http://mytradersjournal.com/stock-options/2008/03/03/more-vip-options/#comment-2430 On what basis did you short VIP? I think its a great company. On what basis did you short VIP? I think its a great company.

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