Thursday, January 19, 2006

What an exciting and pity option trading

I bought 27 GOOG $430 Jan06 put and 17 GOOG $440 Jan06 put at the time when GOOG was $450. My average cost of $430 is around $1.5 and $440 is around $2.6

GOOG used to surg to $470 which make these of my put position almost to <$0.5

Yesterday after previous day's YAHOO/INTEL's bad news. GOOG drop to $444, which lit my hope of recovering. At the closing of Jan 18 (3nd day prior to option due day). $440 put was priced at $2.8, I make even and earned a little.

2 days left, I was expecting GOOG to drop to $430, if I keep all my position, I will profit $20000. While at the opening of today (Jan 19,06), GOOG raised a lot hitting $453. then the $440 option price drop to below $1, which makes put owners very anxious of these fate. so do I. "FEAR" push me to get rid of these ASAP, just 1 day left before due. So I sold all my $430 puts and 15 $440 puts.

Market is green and bull. But Miracle happend that in the last 2 hours, GOOG sank from $449 to $433, but I only have 2 position left. What a pity!!

What if I do something else, so 17 $440 put call give me extra $6000 profit! Pity!

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