Since last Friday was the day that equity options expired, I looked for stocks that might get pinned as described in the last post. By quarter to ten it looked like Google was pinned to the 340 strike. The smart thing to do would have been to sell the strangle. That is, sell the 350 call and the 330 put to give the stock room to move. What I did was sell the 340 straddle, a 340 put and a 340 call.
All looked good as the morning wore on. Google fluctuated between 339 and 341. I went to eat lunch at 1:30 PM when I came back, Google had broken the pin when the rest of the market rose a percent and a half. It ended up the day near 346. So I took a small loss.
Buy the straddle but sell the strangle.
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