06-23-2022, 12:40 PM
(06-22-2022, 07:59 PM)NilesMike Wrote: Anatomy of a bad trade. My final single name option trade, indices only going forward. Too much risk w/single name.I had a put open on MO as well. Not as high as yours but I got bit. I am having my worst put selling month ever. Oddly enough, mostly on ETFs. I leaned into oil a little too hard. I sold WAY out of the money and a couple weeks out. Didn't matter. I can not believe how hard it fell on no big change in fundamentals. Your point is taken though. An oil index is highly likely to bounce some from way oversold. MO? It could be 6+ months of churning around low. Individual options are especially risky now but some of the analysts estimates are still stuck in 2021 and need adjusted down 25%. The market never likes that.
June 1 MO is $54, sold a 52.50 put figuring it will hold up going into dividend. Not so much, it tumbled and got assigned, price at the time was 45. Not good, not horrible, I'll hold it and sell call(s). Sold a 47.50 call, total collected premium from put and call was around $1.40 so I'll continue to fight, it was small(thankfully) size.
FDA comes out today and FLUUUUUUUSH.
Final lesson, well learned.
Good luck to all.