I just opened a small position for the Div play with July 35s @2.80, Exdiv will be around beginning of May, I will layer in slowly on further weakness. Just letting you know what I am doing to move the msg brd.
FWIW, my trades this Q on the MLPs:
LINE, entry X-14. Exit X-1 on the Open
KMP, entry X-23, Exit X-4 on the Open
Got to play every Q this year and every year, over and over. Look at history...;-)
Been in KMP long for years (one of best run Cos. in America) & have been looking at AGNC & Options lately in general...what sort of results have you obtained used your strategy? Do those dates work for a long only strategy, or do you do both (ops. incl.)?
I, for one, appreciate your honest & thoroughly researched strategies & postings! Just try to follow a strategy posted by G. Soros in one of his books-always vague, philosophical & rambling-guess he don't want no stinkin replicators!!!
I only trade options on KMP. It is too rich for me to buy shares of any consequence. I was looking at the April Calls as I would suggest selling KMP @ Ex date minus 4 days on the Open. Since KMP's EX date normally falls around April 26th and I want to exit 4 days before that, it would place my exit on the Open one day(trading) after April option OPEX (19th)
So May options don't thrill me. On a pull back tomorrow or Monday I might pick up a few of the Apr85/87.5Puts in a Bull Put Spread for .90 credit or better. BE 86.60. Max profit .90/spread @ 87.50 or higher... Max loss 1.60/spread @ 85 or lower, all of these values @ close on April Opex(April 19th).
I am entertaining other strategies???
New to options but have enjoyed MAIN and AGNC long for 2+ years for the divis. This may be a dumb question but Why the July 35s and not the May 35s as the Exdiv expected in early May? TIA
That is just me being cautious, the difference in premium is only about 10-15 cents and it is cheap insurance in case of a delayed div date, or some other unforeseen problem. 60 days for 10-15 cents is worth it to me.
Continued -And the other reason I chose July is it runs me into July earnings which historically has a run into earnings in case I decide not to sell into May EXDIV. All that for 10-15 cents
I'm taking small bites on today's pull back. May 35's for $2.40. I would go bigger but we've got a lot of time before X.
Also watching KMP, ETP, EPD, OKS, & EPB. KMP's a maybe, but the rest are well above what I'm used to. I may wait to see if they can put a run together on top of the new highs.
I also picked up some May 35s for 2.38 average, The spread between July 35s and May 35s opened up quite a bit today, and now it makes sense to buy the May 35s. Small positions to start and will layer in over time if pps drops further.
Just a quick question for Doc or anyone else .. When you say X - 14 .. Are you counting every day during the month or only trading days, when the market is open? I'm assuming you are counting "every day" in the month. Thanks, Rich