I just sold my 35 contracts of Advanced Micro Devices (AMD) Puts with a nice 1 day profit.<\/p>\n
Yesterday I bought 35 contracts of AMD Puts. AMD has been a very hot stock so a lot of people may have thought I was nuts. Now that AMD is moving in the direction I predicted many may think I\u2019m nuts for selling to early lol.<\/p>\n
Take a look at my post reporting the buying of the Puts to see my reasoning. You can read it at,\u00a0Bought AMD Puts<\/span><\/a>.<\/p>\n In my post buying the Put I said I wanted to make 30\u00a2 or 40\u00a2 and I\u2019d be in the position a day or 2. Well, this morning the stock opened down so I was watching closely. I bought the 35 puts for $2.29 for a total of $8015 for the 35 contract. 35 contracts represents 3500 shares. That\u2019s a sizable position and I guess it shows the confidence I had in my prognostication. As the stock was going down I was watching closely for 2 reasons. #1 being my Long Put and #2, the 1000 shares I own to cover the 2nd leg of my Triple Play Hedge, which I\u2019ll get into later in this post.<\/p>\n As the stock went down I placed a sell order on my Put. I placed the order to sell when the premium hit $2.80. I placed this order because I was also watching other positions and I didn\u2019t want to miss out if my premium hit the $2.80. At $2.80 my profit would be 51\u00a2. As I was watching a few positions at once AMD took a quick drop. I tried to change my order but my order at $2.80 was filled. No big deal! I love taking profit and selling at $2.80 was a very nice 1 day profit. My profit on the 35 contracts was $1785. As I write AMD is still dropping. I\u2019m moving on to the next deal. Bringing in $1785 on a $8015 investment is a Rate of Return of 22%, a great return in 1 day. FANTASTIC!<\/p>\n 7\/17\/19 \u2013 Buy to Open 35 AMD 8\/16\/19 $34.00 P @ $2.29 ($8015)<\/strong><\/p>\n 7\/18 19 \u2013 Sell to Close 35 AMD 8\/16\/19 $34.00 P @ $2.80 ($9800)<\/strong><\/p>\n As I\u2019m writing I just heard Crammer say something on CNBC. He said \u201cDon\u2019t try to hit home runs because sometimes you strike out.\u201d Even though AMD continued down after I sold my Put, I\u2019m very happy with my profit!<\/p>\n When AMD opened and moving down I made another move. For the\u00a0Main Street beats Wall Street\u00a0<\/strong>loyal readers, do you remember the Triple Play Hedge<\/span><\/a> I did? Well my 1st leg expired and I was assigned on the 1000 shares I owned, exactly as I wanted! Making a $830 profit. At that time I bought another 1000 shares at $32.65 to cover the 2nd leg. Today when AMD was dropping and down to $33.10 I sold my 1000 shares that were covering my $33 2nd leg. This was a risky move because my 2nd leg was still In-the-Money<\/a><\/span>. As I write the stock is down to $32.60. If the stock starts to move up I might buy the 1000 shares back to cover that Call, but for now I feel confident the stock will drop a little more. I would love to not have to buy and leave the Calls Naked until expiration, but I\u2019ll only stay Naked if the stock goes down a little more.<\/p>\nProfit +$1785<\/strong><\/span><\/h4>\n
\nFor the loyal Readers<\/strong><\/h4>\n