After the last divi run debacle I'm considering the possibility we may have a good run this time.
1. On the conference call Gary practically promised the 1.25 div would be maintained in the near term.
2. The earnngs release on Friday resulted in a spectacular move on big volume.
3. The SP is just a bit above BV (31.64).
4. SPO is possible though not likely.
I'm considering Jan 30/32 calls. The longer term allows for a greater margin of error even thought the leverage is reduced.
I just took a look at the price of Jan14 $30 call options. The bid/ask is $2.38 - $2.62. The share price is presently $32.39. Does that not mean that the time premium is virtually zero?
Does anyone know why that would be so?
AGNC has established itself as one the better run Riets based on the last quarter report and the threat of a near term dividend cut has been all but eliminated. With any improvement in earnings next quarter a dividend increase could be likely.
Looking at last years trading range, before the threat of a dividend cut, I would think we would return to that trading area of $33 to $36. With $36 being close to the run peak and $33 being the low post ex dividend.
I bought Jan 30 calls @ 2.52, Jan 35 calls @.26, and sold March 32 puts @.49.
After I bought MTGE announced a secondary. I think this dramatically increases the probability of a secondary in AGNC before EX. I believe that will be a great buying opp.