You would be long 1000 shares AGNC at a debit of 28, 000 + commission to your account. I was long Dec35 Puts on a credit spread, so I will be Short AGNC @ 35 on Monday. I need to Buy to cover the shares or else hold and pay the dividend and cover hopefully at the lows post EX.
I haven't decided. I think we'll be close to BV on Dec 22nd, so I might hold. We'll see. It will probably depend on whether I have Lasagna or Filet Mignon tonight. My sleep/digestion guides my trading...;-)
Good luck to you!
You can call me faaqcee the fencesitter. Either yard I'm straddling may contain a persimmon tree or a pitbull. There may be fruit in both, but the dog may be in one of them. I'll wait to smell something funny or hear a growl, then proceed. To date I've stepped in only good fortune since investing in AGNC.
"The difference between the 9/21 close..." I think you mean the 9/20 close shown earlier in your post. I understood everything else and agree, hence my strategy. I'll do it with a share purchase, a sell, and a rebuy(I guess that would make me a daytrader. gasp shudder), If AGNC's day indeed seems to panning out that way. If not, I will count the dividend money and wait for the next spo,imo, 6wks. or so into the new quarter for my repurchase of my previous stake, plus any new shares I may be able to afford with the combined cap. gains and div. from 4th. qtr 2011. We are all prone to rethinking our strategy. This seems to be a way for me to have the most options, allowing me to change course if I deem it more profitible to do so.
This is what happened last time on 9/21
9/20 close $29.06
9/21 open $27.62
9/21 low $27.11
9/21 high $27.91
9/21 close $27.12
So, the difference between 9/21 close and the low was $1.95. It rose $.80 between the low of $27.11 and the high of $27.91. That is about one-half the dividend. So, you could have played calls on the low to the higher for $.80, and I have done that on Line once.
It may be harder to predit the timing of the SPO than it has in the past, but if the price begins to escalate the next day after ex-div, then that will be my sign, plus watching short interest and the put/call ratio.
I might just wait and see, but I enjoy trading around this theme, but the short interest is what triggered me to play the puts before the SPO. I have only been successful with it twice.
Good luck to all, particuarly those who hung in their for the MOnday morning bounce!
The difference in pps between the end of the runup and the ex-date most times does exceed 1.40. That, along with the possibility of an upcoming spo allowed my decision to sell just under 1/2 my stake in AGNC on Friday. Conversely, the possibility of a nice bump on Monday,or the possibility that a spo would not follow so closely to the ex-date(giving time for the pps to recover) caused me to choose to hold over 1/2 of my shares in AGNC.
Subtract Tuesday's ex-dividend drop.
They'll be squeezed between the BV (just under $27) and the new price ($27.60-28.00, I'm wagering with my own money).
Not a lot of room there. And they're getting bridging cashflow from the Cantor/Mitsu sales. The effect of which could be to relieve them of having to whack the ticker with a SPO immediately after ex-div this time.
No guesses as to SPO timing from me this go-round.