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Tuesday, January 20, 2015

Gold (GLD) Put Options

8/22/2014 (11:08:06 am, PT) LL

  • sold (to open) 4 October 2014 $120 puts at $1.21
  • probability of success:  69%


10/10/2014 (9:03:56 am, PT)  
  • GLD was trading between $117.19 and $117.74, so my puts were ITM
  • I rolled my 4 October 2014 puts to November 2014 (same strike of $120)
  • Received another credit of $1.12


11/5/2014 (10:00:08 am, PT)
  • GLD was trading around $110.27
  • My short puts had about $0.05 of extrinsic value remaining
  • I rolled my 4 November 2014 puts to March 2015 (same strike of $120)
  • Received another credit of $1.45


1/20/2015 (10:57:09 am, PT)
  • GLD was trading around $124ish
  • The stochastics were in the "overbought" region
  • I decided to close my position today
  • Unfortunately, however, the implied volatility was extremely high, so I had to overpay ($2.32) to buy back my short puts.  That's fine.  I just wanted to take my PROFITS.

TOTAL NET PROFIT:  $541.22                   Success!






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