Friday Update Hello Smart Option Sellers! I hope everyone had a chance to hop into today's new Intel (INTC) put-sell trade. As you are probably aware, prices were attainable well above my recommended level. That's a good thing! Sometimes prices move fast, and since INTC's stock price moved even lower, it popped up the put option price after I finished writing up the alert. Excellent work! I will have the official prices on Monday. Ok, let's answer some questions... Q: Lee, so I was in a store when I got the notice of the intel trade, and got on it about 20 min after email. When I pulled it up on my phone, which I’ve never traded on before, I worked my way through it best I could. I set the INTC 9/20 sell price at .27 for 15 contracts and it went through immediately. Ok, that always makes me worry that I could have gone for more... anyway I got the trade confirmation and this is exactly what it said: Fill Details, sold 15 INTC 09/20/19 Put 40.00 @ .37. Filled at: Apr 26, 2019 10:53:43 AM EDT. is it possible that this trade went through at .37??? Do trades ever go through higher than offered? I don’t think I made an error, but totally could have. Good problem to have I guess. Thanks A: One piece of advice, always check the current bid/ask quote before placing any trade (stocks or options). This keeps you a more informed trader. With your specific trade, since the bid price ($.37) was higher that what you tried to offer ($.27), you are entitled to that better price. That's how it works. It works on the buy side too. If you tried to pay $.30 per contract for an option but it is already being offered at $.25 per contract, you will be entitled to buy it at $.25 per (not $.30). That's a better fill. Next time, check the current bid/ask market and you won't be so surprised. You might have placed a $.39 offer if you had known, and could've gotten filled there too. Q: Hi Lee, I closed out/bought back the BIG 190730 put trade at $0.30. Wasn’t this from the rollout we did? Unless I am missing something, this was very profitable. Thanks. A: Yes, we are still holding the BIG put-sell trade, which is a "roll" from a previous position. Depending on whether you had taken any of the hedge trades (calls & puts) from last month, you may have decent profits built up. The current BIG July put option is worth about $.35 per contract, and we could lock it in here, but we're holding out for a bit more, considering the stock is still well above the strike price at the moment. For anyone on the fence, you can certainly close the trade out if you wish. It's your money, so do as you please! Officially, we're still holding. Q: Lee, just curious to know why some trades are filled so quickly and others not so. For example, the MU trade is still unfilled but the MRK trade went thru the same day. A: It all depends on how the stock moves during the day. The MU put-sell trade was unsuccessful because the stock didn't move enough to the downside to give us an easy fill. Plus, the put option bid/ask market was very tight near our $.25 per contract level. MRK on the other hand was easy, as the stock kept dropping and the option bid/ask price was already above my recommended level. Sometimes they're easy, and sometimes not so much. Q: Hi Lee, your thoughts on buying crypto currency at this time? A client of mine has quite a bit invested in crypto and I am considering a small investment. I understand you cant give personalized advice, maybe something you can address in your weekly Q& A session? A: Ah, crypto! It's something we talked quite a bit about in 2017. And then in 2018 - not so much. Why? Because crypto went down the tubes. People like hot products, and crypto was losing its luster. But it seems to be making a comeback over the last few months. Right now, Bitcoin is near $5,100 per coin, a nice rise from the depths of $3,000 it hit back in December 2018. I think that might have been the bottom. Look it, if you have some money to play with, why not give it a shot. The good thing is, is that you can buy fractions of fractions of crypto, literally spending as little as $10 if you wish. I still have the link intact near the bottom of these alerts to open an account at Coinbase. Take a look if you want. Q: Hi Lee, At Friday's Q & A you addressed my following question: "The other issue I've noticed is when we buy the position back. Sometimes the option prices stay the same for a long time even though the stock price is moving up a lot, like EMR. The stock price was about 35% above the short strike but the option price didn't move for quite sometime. I don't know if it's because there are of bunch of GTC orders sitting there at .05 or some other reason?" Just to clarify the question better; the bid-ask price on the option was .05 - .10 which stayed that way for some time as the stock price moved up. I was trying to buy it back at .05 but the price didn't move. I was wondering if the reason was because several of your subscribers had GTC orders sitting at .05. The market makers had a sure thing so they held out longer at the higher price above .05? Do you prefer that we don't enter GTC orders on buy backs until we actually see the option prices trade at the 80% rule? Which brings up one more question; on the Schwab platform, EMR options orders can only be placed in .05 increments. Do you know if this is unique to Schwab or do other platforms such as Interactive Brokers allow you to place .01 increment orders? A: I always try to wait for the option price to be offered at our 80% Rule threshold before putting in the buy-back order. If we set up the buy-back order before that time, it will take longer to fill. This is because the option market-makers will let our order sit there until it's convenient for them to trade with us. It's best to wait until you see a $.05 offer price instead of you putting in a $.05 bid price. See the difference? As far as penny increments - it is stock specific, not broker specific. Ok, that's all for today. Continue to hold all other open positions as-is. Contact me here with fills, comments, questions or concerns. Have a great weekend!. Regards,
Lee Let's Grab That Cash!