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  • rlcfromdaltx rlcfromdaltx Jul 1, 2009 3:38 AM Flag

    1000 Jul 13 Calls...What to do? Serious answers only.

    First, I agree with the poster who suggested you not take buying/selling advice from anonymous posters on a message board, myself included.

    Secondly, I'll be happy to tell you what I plan on doing and why. I don't know anything about charts. MA's I understand, candlesticks ...? I focus on the company's fundamentals and the big picture of the economy then go with gut instinct. A couple weeks ago, I had a feeling BAC was going to continue the "run up to OE week, then drop" tendency its shown since April, so I went in pretty deep (for me) in July and August calls from $14-17. Unfortunately, I bought BEFORE OE week last month (still learning options), so I'm sitting on huge losses right now.

    On the upside, I'm still sitting on them and still think I'm right. I expect a nice bump next week because SOMEBODY is going to preannounce. Maybe BAC, maybe GS or JPM, but someone is not going to be able to keep a secret. Then all the positive buzz that's been going on about the stupid profits the big banks are expected to report in Q2 is going to create a buying frenzy.

    I'm going to ride that wave to whatever price level it drives BAC to then hit the sell button on the 9th or 10th. I'll cash out and buy the stock because their long-term (2-3 years) earnings potential are astronomical. Even if they disappoint on the 17th, I'll take the 6-8% drop and ride it back up, no problem. Probably even buy more.

    That's just me. If you had enough sense to load up that much, you have enough sense to know what to do next. Trust yourself ... it's your money.

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    • Over the course of time you ought to know who is a reliable sounding board and who is a poser!

      Never say never!

      i subscribe to the view that it is my responsibility to do my own due diligence and to make my own decisions.

      Though I'll always be open minded and listen to what others with credibility have to say, regardless of subject matter!

      I would hold the July 13 calls for a while longer if they are likely develop more value. Shares will have to work higher in price so your delta gains can out run the loss of Theta (time)!

      The fact is that your calls cost you a premium, so you theoretically (upon exercise) own BAC @ $13 plus the price per share you paid for the option rights!

      (13+xyz=13+) We only trade at $13.16 right here and now, with trading fees it is hard to see a profit yet..

      Healthy Trading!

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