Closed all FNM Contracts
Too busy at work today to write all details, but in short - I took a big loss on my FNM calls and took small profits on my FNM puts. I should’ve closed this out days ago and finally did it. I started to put an order in to buy shares earlier today and would’ve had only a $4-500 loss in the end as this would have covered me, but waited and FNM jumped. My total loss is $2781 on the FNM stupidity.
I sold two more FWLT April 45 puts (UFBPI) from a limit I had in earlier in the week. It’s up $6 from its lows, so I’m happy with that order, for now. I received $228.50 after commissions.
Comment by Alex Fotopoulos
I closed out my MO naked put at 3:30 for $4.80 and took a loss of around $200 I think. I opted not to take the assignment on MO as I regroup and start over somewhat from my recent downfall.
Comment by Options Strategery
I am getting killed on my hedges too. I am wondering if there was short covering ahead of the long weekend. If I were short (and I am on WM), I would be worried about ‘upside news risk’ over the weekend. Plus, everyone is just cheery after avoiding major disaster and enjoying Easter weekend. I am wondering if you pulled the FNM too quick. Then again, I have a bunch of WB 30 calls that I am naked on that are taking in big losses. Ah, the joys of expiration.
Comment by Alex Fotopoulos
I did get out of FNM a little early. It went lower than where it was when I exited, but I had been walking that line long enough for me. I actually think it’ll dip again, but I opted not to accept the risk of it just continuing to climb. I wish I had bought 400 shares in the first 2 hours of the day and I’d have saved $2k, assuming it didn’t tank before April expiration and I lost on those shares and the four puts I had. A mistake I made was starting off with 4 calls and not legging into it slower.
WM could be in the same boat. If the Fed has their back, they might have limited downside and will climb until the downside is more equal to the upside potential. Had I been thinking I would have taken a $2-300 loss as soon as the Fed stepped up over the weekend with the backing of Bear Sterns financing and definitely should’ve jumped ship by Tuesday aftn. I sat around waiting and hoping instead of facing reality.
At least I finished up for the day overall.
Comment by Options Strategery
I am waiting for WM to get a Bear style take-under. The Fed will save them but given the rumor about lower BSC offer to reduce moral hazard, the WM common will get hosed if the need Fed help.