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Tuesday, June 28, 2016

Gold (GLD) Call Options

Friday, 6/24/2016 (12:58:23 pm, PT)

sold -10 June 30, 2016  $129 calls at $0.91

Why did I place this trade?
  • "BREXIT" results were announced in the middle of the night and gold jumped 5%
  • when GLD rises, its implied volatility also rises which results in very attractive call premiums
  • 73% probability of success
  • stochastics in overbought region

Tuesday, 6/28/2016 (10:53:58 am, PT)

bought back all 10 calls at $0.19

Why did I place this trade?
  • GLD dropped today (6/28)
  • when GLD drops, its implied volatility also drops which results in cheaper call premiums


It's VERY tempting to hold my position for TWO more days in order to keep the max credit of $910, but it's good practice to always TAKE YOUR PROFITS

PROFIT:  $720 (in 3 trading days)