Saturday, April 9, 2011

Call Spreads Rule

I only say that because in most cases my profit per share increases as does my percentage gain while reducing my investment and break-even point.

Obviously there's an element of timing. I sold the HAYN $50 at a good time which has more than repaired that trade. It appears that I sold the SSW too early and too low (strike-wise), though that doesn't take into account that over 80% of my investment was removed from the trade and I still doubled up what was left. I think the VSH call was at a loss when I converted it to a spread with a so-so (but positive) return.

                                                                                                                                                                                                               
SpreadStock
Price
Net / ShareGain
CallSpreadCallSpread
HAYN 45 / 50$51.26-$0.34$2.70-5.2%117.4%
MNTA 13 / 15$15.26$0.36$0.5519.0%37.9%
PTEN 23 / 29$29.23$1.03$1.6519.8%37.9%
SSW 10 / 12.50$19.13$2.73$1.3042.7%108.3%
TTMI 12.50 / 17.50$18.05$0.85$2.1518.1%75.4%
VSH 10 / 17.5$17.91$0.31$0.704.1%10.3%

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