More Money Saving Options on ADBE

I actually thought CSCO would fall more today than it did, expecially after the unemployment claims came in worse than expected.  I didn’t panic with CSCO and waited to see if it would start to tank.  I was considering shorting some, but apparently the markets decided it was already beaten up enough in the near term and only got a small spanking.

With my theory that Tech was going down, I thought ADBE would drop more too.  It has some, but not like it was showing in pre-market bid/ask prices.  When ADBE was around 32.45, I sold two new March 35 naked calls (AEQCG).  I received $168.50 after commissions. 

Technically they are naked calls, but at the end of next week I’ll be assigned 200 shares from my February 40 naked puts.  That’s assuming ADBE doesn’t rally in the next week and make my Feb 35 naked calls come into play.

I’m trading in a circle with this almost.  I started off taking in $258.50 from the Feb 40 puts and then $108.50 from the Feb 35 calls and finally today $168.50 from my March 35 calls.  All that without owning any shares yet.  That’s $535.50 in premiums I’ve taken in after commissions, ie $535.50 in money savings using options that counter my upcoming $1,000 loss from the share price drop.

I can’t call a time when I think ADBE will make it’s move back up, but I don’t think it’ll be before February expiry.  Looking at the chart below, I think 35 is going to be a hard line to cross and 40 is unimaginable in the near term.  In fact, if ADBE climbs back up to that steepest downward trending line of lower highs, I’ll probably sell new naked calls at 40 if not 35.