smasty 6:39 am on Friday, May 18, 2018
Tags: BigLizard ( 3 ), CallButterfly ( 17 )

AMZN

The big thing I’ll be watching today is AMZN, since I have an ITM naked put on it. Last Friday watching it pin 1600 was a beautiful thing. There is adequate OI on the 1600 line today to support a move back up there again. If I’m going to keep playing AMZN it’s got to be done more safely, with one of our stock replacement structures. If I do take assignment, I’ve designed a “#SharkFinHedge ” that has a max loss of about 1/3 of my next call sale to provide about another $10 downside along w/ the new call sale for next week. Here’s what the hedge looks like: May 25 1565/1555/1550 broken wing put butterfly for about $2.00 debit. Keeping these tight with DTE means they move more quickly with underlying price movement. I also will sell calls near the close in advance of assignment. Stay tuned!

#callbutterfly

#biglizard

mortlightman 6:49 am on Friday, May 18, 2018

Have an BuPS expiring today 1565/1560 sold 5-11 for .34
Also have a 1580/16001620 BF for Jun 1
Jeff 6:54 am on Friday, May 18, 2018

I’m in the 1575/1600/1625 #CallButterfly expiring today. I’m with you, rooting for a pin, but not looking too likely.
smasty 7:06 am on Friday, May 18, 2018

I went ahead and put on that hedge about 20 min ago in anticipation of further weakness today. I’ll do a full recap this afternoon on trades and cost basis.
smasty 8:21 am on Friday, May 18, 2018

Here’s some trades I’ve executed today:
1. LMT #BigLizard I took 54% profit on this and rolled to next week, the last week before div. May 25 -320p/-322.5c/+325c for $3.40, BE is $316.60. Here’s an interesting stat on my LMT activity for the last month. I’ve been playing 1-3 lots on income collection with stock assignment desirable for the upcoming dividend. The div is worth about $600 on 300 shares. Since 5/1/18 I’ve collected exactly $2,000 on this campaign. NOT including the most recent sale today, which could bring in another est. $600. If I don’t get assigned next week I will not pursue dividend any longer.
2. NVDA I sold calls for next week in anticipation of stock assignment tomorrow morning. I will be assigned stock at $257.50, but I have already reduced cost basis to $246.69
3. NFLX rolled calls to next week, Cost Basis = $319.70 on a $330 assignment
4. CARB rolled ITM calls to June (monthlies only), cost basis is $33.03 on a recent 34.62 buy
5. IBM rolled calls to May 25, cost basis is $144.65 on a 152.62 purchase
- smasty 11:07 am on Friday, May 18, 2018
  
  AMZN: final trade of the day
  Here’s where I am w/ AMZN: Going into this week I’ve collected $22.50 on puts ($1600 strike), so my break even is $1577.50. Current stock price is 1574.33. I WILL take assignment of 100 shares tomorrow at $1600.00.
  STO May 25 1580 call @ 15.75
  BTO May 25 sharkfin hedge
  New Cost Basis = $1562.39, if the hedge comes into play it will give me an extra $10-20 in downside protection. If the hedge is not needed and expires worthless it will take $6.00 out of the net 38.25 premium collection.