Next week will be crazy, so my plan is to hedge myself against a big drop if FED dissapoints. Now on Friday I bought an EMC call, EMCDC, an April DITM call @ strike price 15. This will allow me to pull out of EMC stock, which I have 1900 vested in, on Monday. This will give us free cash on hand in case of a big drop. Then we can buy in little by little on the way down.
If everything goes up next week, then I will not buy anything and put my money aside into my high yield 6% account because I close on my house on or around OCT 30.
If we do have a big drop, I am looking at high yield dividend paying blue chips. A few that come to mind are PEP and BAC. I really like BAC, especially if I can get it around 48 price range. I would look to by PEP if it fell to 67. These two I would prefer to own their stock than their options.
Options for next week... my BBY has went up the past two days. Now I have 5 contracts...a lot invested. Now it's up 10%, but I expect it to rise at least 50 cents on monday. Now If I can get 4.50 out of the contract on monday...I will sell two. I anticipate more short covering on monday. I can lock in some profit and then hedge myself against a big fall on tuesday depending on how earnings turn out. AMAT is a longterm play, so I'm not concerned about it. If OSK decided to run up to 60 I would sell my options. I'd rather be in CRDN.
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1 comment:
i would dumb BAC, it is the market average
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