WK43: Reversal Play with Long Option


This week, 26 Oct is APPL earning week and when market opened, it gap down from 118 to 114. This triggered a few strategy I had in mind as I am bullish on AAPL and had calculated the intrinsic value of AAPL to be $124 (Using DCF and PL Chart http://www.gurufocus.com).

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Wk 40 2016: GOLD broke down


On hearing of GOLD price dropping like drastically, I went in on the tested side to ready to catch a falling knife and intent to pick some assignment with bull put spread.

News of GOLD drop further,  I enter with with less contracts thinking it will rebound. There was various window of opportunity to do adjustment but my instinct tell me it will recover.

The next few days it dropped even lower and I enter less and less contract. Overal, I am still positive in wk40 to be profitable, however I could have done better if I were to :-

  1. Enter smaller to bigger contracts progressively
  2. Perform adjustment of closure to take loss or profit when market present window of opportunities
  3. Stick to the PITM and not chase after premium