AMAT AMBA DUST and scaling in

#LongCalls #LEAPS – Something I’ve started doing on these longer term positions is really working nicely. I’m setting the initial position after a pullback (or run up for short positions) and only starting with about a half position. This allows nice gains if my timing is perfect (ya right! LOL) but more importantly it allows a nice averaging down into the full position and drastically reducing the cost basis (in addition to the weekly selling).

Added another AMAT today:

Bought AMAT JAN 17 2020 50.0 Call @ 2.43

I’ve added 3 times now. Original half position at 7.70 and adds at 2.55, 2.55, and 2.43 reducing basis to 5.75 overall. Weekly sales have further reduced this to 4.12 with the position out to 2020. LEAPS are trading at 2.40 now so slightly underwater but not nearly as bad as it would be had I gone all in from the beginning.

AMBA is an even better example. Original position at 11.20 with adds at 11.00 twice to get to a half position. Added the other half after the implosion at 5.20 and 3.40.

New basis is 7.44 with weekly sales reducing that to 3.93. The LEAPS are trading at 4.65 so the position is actually profitable in spite of over a 30 percent selloff since starting the trade. What really helped was piling into my full position on the big earnings drop on Aug 31st. Actually caught the bottom there so a big help.

Same thing with the DUST short position. Started at 14.50 with adds at 14.20, 14.00, 13.49, and 12.50 getting to only an 80 percent position but the trade is nicely profitable already.