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American Capital Agency Corp. Message Board

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  • codplyr23 codplyr23 May 11, 2012 4:20 PM Flag

    it's not stopping

    What options are you holding? I am long 25 of the Jan 2014 $32 calls. I have the same feeling as you. I am up 70% on my trade and I just keep hearing the saying, "Bears make money, Bulls make money and Pigs get slaughtered." I hear it over and over in my head. I don't want to lose my profits but at the same time I know that I have a year and a half for this to continue up. I know I'll sell then it will run up to $35. The whole dividend does concern me as I am not sure what the option prices will do. I am considering selling half my position at a double and holding the rest so I am playing with the house's money. What do you think?

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    • yourbestfriendintheworld yourbestfriendintheworld May 11, 2012 4:54 PM Flag

      I have some Sep 25 calls and some June 30 calls. I covered my June 30 short Puts and I've sold a portion of my June 30 calls at triple their basis already.

      I'm wary of the timing of the div and SPO because of last quarter's uncharacteristic scheduling, so I have taken a lot of my riskier positions out of play, but it's still got some room to run so I kept a fraction of the June 30s to take advantage of what's left of the run.

      The Sep calls are safer, being 3 months farther out, but I only got into those as a proxy for buying more shares, which I didn't want to do because the price wasn't dropping to 29 during the last SPO; just a matter of sparing the cash when I could get even better leveraged delta in deep-ITM options. Although I expected a little better liquidity and probably paid a little too much because of it. But, if I can close them, I'm looking at better than 50% in profit, which ain't sneezing money.

    • whatever you are happy with, just go with that. you will not be able to time it so that u always sell at the top and buy at the bottom. if its close enough, then its better to have that than to have nothing at all....

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