Posted by jtsurfah on 21st of Jul 2021 at 12:28 am
Nice trade...for now anyway
Starting with a long call into an
oversold situation and covering it to take in some premium once the
easy money is made is one of my favorite ways to get into a bullish
spread tread. Depending on the circumstances, if you get the
initial move you expect, you can often sell a call against the
naked call that will completely eliminate possibility of any losses
on the overall trade (other than a portion of unrealized gains),
but still alow for some upside in the form of premium. Or you
can take some more risk and sell an out of the money call for a lot
more potential pop (if you're right).
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jtsurfah, thanks for the idea.
Question answered
Posted by craigm on 20th of Jul 2021 at 05:01 pm
jtsurfah, thanks for the idea. I sold a call near the close before the EOD drop.
Nice trade...for now anyway
Posted by jtsurfah on 21st of Jul 2021 at 12:28 am
Nice trade...for now anyway Starting with a long call into an oversold situation and covering it to take in some premium once the easy money is made is one of my favorite ways to get into a bullish spread tread. Depending on the circumstances, if you get the initial move you expect, you can often sell a call against the naked call that will completely eliminate possibility of any losses on the overall trade (other than a portion of unrealized gains), but still alow for some upside in the form of premium. Or you can take some more risk and sell an out of the money call for a lot more potential pop (if you're right).