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American Capital Agency Corp. Message Board

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  • reits_r_us reits_r_us Dec 4, 2012 3:43 PM Flag

    The real options trade for AGNC

    The other elephant in the room for these short Puts is whether OPEX will be before or after EX. If after, and you are going to liquidate before the EX, then you can add 1.25 on top of the premium of all Puts ATM or greater in value. Add smaller descending amounts for all OTM Puts.

    So if you short a 33 Put and the EX is on Dec 20th, and the PPS is at 33.00 when you cover on the 19th, then that Dec33Put is still @ 1.25 and change. If the EX is on the 28th, and you liquidate on the 20th, then, if the PPS is at 33.00 when you liquidate, the Dec33Put will be approx .33.

    Big difference, so I am hoping for an EX post OPEX, for many, many reasons...;-)


    Sentiment: Strong Buy

19.01-0.10(-0.52%)May 26 4:00 PMEDT