$NUGT

I made some trades on Friday but was very busy and didn’t have time to talk about the what and why.

Given the strength in $NUGT, I sold some additional puts to give me more protection if $NUGT just keeps running, and gives be a bigger window for making money if we do get some pull backs short term.  I’m thinking that the strength in $NUGT/$GDX on friday was short covering before the weekend and any further pullback in Gold will show itself in a pull back in $GDX/$NUGT.  Longer term puts were sold such that if I do get put stock, that will happen in the $20’s or lower.  Likely be able to close for a profit long before expiration.  Gold will eventually either stabilize or pull back, both will reduce volatility/reduce options premiums (vol suck).

STO Feb 19 $50 puts @ $4.00 to pair up with my short $50 calls.  I now have a profitable window from $55.20 down to $44.80 so with a short week and any sort of pull back, I’m likely to end up in that window.  Below $46 and I roll the put down and out.  Above $54 and I roll the call up and out.

STO Mar 11 $40 puts @ $3.30 against $70 calls, now profitable between $75 and $35

STO June $40 puts @ $9.90 against $70/$72 calls, stock put to me @ effectively $26

STO Jan’17 $53 puts @ $26 against $75 calls, stock put to me effectively below $20

 

If we get a pull back this week (improving put premium), I will be looking to sell Feb 26 puts against my $60 calls.  I still have a few other call positions not covered with short puts while I monitor how this plays out.

Time will tell if this was a smart move or not.

Hope you all have a great weekend.