Christmas Trade

December 9, 2016 | Filed under: Uncategorized

One my favorite trades. Due to the long history of an 9% increase in the DOW from Dec 1-Jan 15 for decades. We are going to buy a single call position (nothing to do with spreads), and play the up direction.

Notes:

  • Single Call position.
  • One strike price in the money.
  • Hold from Dec 1 to Jan 15th.
  • Trade the “DIA” symbol.
  • At least 90 Days plus of time (to decay does not kill us).

Perhaps put a stop order (or buy back contingency based on support levels, to minimize a potential lost, or dollar amount trailing stop). If you don’t know what these are go to Think or Swim videos and learn about a stop or trailing stop.
Position: Took the March DIA 192 for $ 5.30 (60 cents in the money).

Note: $ 187.50 looks like a level of support. So, going to set a contingency order. IF DIA goes below 187.50 Sell my call. Other than that holding the position till about Jan 15th.

PS: That trade as of Friday (Dec 9th). $8. 48 value. Up over $3.18. I am in the money honey. UP 60%. 

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