Wednesday afternoon I took a small profit on my Sept 270 AAPL calls. With AAPL trading just above the 270 strike, I cashed out my position for a $250 profit.
Friday, September 17, 2010
Option Update: AAPL a small profit for a big idiot.
I took my money off the table for a couple of reasons:
1. I was worried about weekly jobless claims coming in higher than expected, and the weeks prior being revised higher due to the ‘guestamation’ that was factored in for labor day. Obviously, the numbers were inline and market shrugged them off.
2. Next, I assumed the stock would be pinned around the 270 mark heading into Sept expiration. It did dance with the $272.50 price for a few hours but then exploded to the upside on heavy volume.
I figured at max I had an upside of about 1-2 points and at worse I was risking the entire position. I took the profit, and drank myself to sleep last night.
What do you guys think? Did I panic or was my reasoning sound? Obviously hindsight is 20/20.
Please feel free to comment.
Best,
CM
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You should have bought longer dated calls. No reason to give yourself less time.
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