Trade Update - BIG & HACK
Trade Update - Big Lots (BIG) Hello Smart Option Sellers! It's time to jettison BIG. Just like our recent close-out on Alcoa (AA), BIG has been a bit of a thorn in our side too. It just can't seem to get its mojo on. Although BIG stock is still trading above our strike price, we're going to shut it down today as I don't like how it's performing anymore. It's better to get out now before it potentially falls below the strike price. BIG is at $32.50 per share and our strike is at $30. Sure, we could sweat it out for two more months and see if it bounces. But I'm not so sure it will, especially if the broader market keeps dropping. Plus, earnings are coming out on May 30th, and if they blow it again, the stock could drop back down to $25. That's a scenario I want no part of. It's unfortunate that it's come to this, but it's better to preserve capital than to hope and pray. Here's what you can choose to do: Note: you will only execute today's trade if you already hold the put-sell position in your account. If you don't have the position, you can disregard these instructions. Buy back (buy-to-close) the BIG July 19, 2019 $30 put options for a limit buy price of $1.50 per contract or lower, GTC, as a closing transaction (buy-to-close). Currently, the $30 put option has a market of $1.20 bid/$1.35 offer, so we should be able to buy it for less than $1.50 per contract. Now remember, this buy-back trade is only for those of you who hold the BIG position in your account. If you don't have it, you need do nothing. This trade is part of the roll we executed back in December 2018. We sold this put option for $4.20 per contract, so we'll have a nice gain on it, but it won't be enough to offset the loss we took on the earlier position. I will have the final results on Monday. I know some of you may not want to close this trade out yet. That's fine, but you will have to manage it on your own moving forward. In the end, I have lost confidence in BIG as a stock that can perform for us. I think it will continue to meander in a downward fashion. I could be wrong, but I'm not willing to wait anymore. Get those trades in there and let us know how you do. Trade Update - Prime Cyber Security ETF (HACK) On Wednesday, we placed a new put-sell trade on the HACK September 2019 $31 puts, that so far has been unfilled. At the time of the alert, the put option had a market of $.20 bid/$.35 ask. It seemed feasible that we could get filled. No such luck, as the stock itself rallied about $1.50 per share. This put even more downside pressure on the put option prices. Let's give it a little more time to see what happens. If we can't get it, we may alter the strike price. Continue to work the order for now. That's all for today. Continue to hold all other open positions as-is. Contact us here with fills, comments, questions or concerns. Regards,
Lee Let's Grab That Cash!