IRA – LDK DEC09 PUT
November 2nd, 2009, 1:06 pm EST. Posted under Individual Retirement Account (IRA) by ThetaTrader.
Post Tags: , CLOSED, LDK
11/02/2009 – ThetaOptions IRA Portfolio – LDK Dec09 PUT position Adjustment
LDK has continue to fall hard today. In order to take advantage of the Volatility, we have decided to sell another contract. Although this time , we’re selling the NOV contract.
Nov 09:
Sell to Open: (1) 5 PUT – $0.65 credit
Position: Our position contains (2) Naked Short Puts. The IRA Margin requirement is $500 per contract, which means there is NO margin. IRA accounts do not use margin; they keep the entire strike price in reserve cash. So if we sell a $50 put naked in an IRA, then we need $5000 to place the order. That’s why it’s more favorable to sell naked PUTs under $20 in an IRA account. The LDK & Ford plays we made are perfect for selling PUTs “IF” you want to own the stock.
Note: The RED highlighted positions are for our Long Term JAN11 trade.
************************** 1st Trade Post **************************
ThetaOptions IRA Portfolio – LDK Dec09 position initiated
LDK has been getting hammered over the past few months. The stock is down another 15% today & we decided now may be the time to enter a “Naked Put” position. The stock is currently trading at about $5.75, so if we get the stock for $5.00 – 0.65 (Put Sell), that’s $4.35 or 25% off the current price.
1st action: 11/02/2009
Dec 09:
Sell to Open: (1) 5 PUT – $0.65 credit
This trade has a nice Theta value, considering the most we stand to make is $65
