If you were really confident the price was going up by June

[Optionray]

Would you sell the June 90 puts for $23.32 and buy the June 90 calls for .28c?  Yup!  Planning on buying the puts back for around 10 (13.00 profit) and selling the calls for about a dollar profit when the stock hits 80+ by June.    That's my take, and I'm sticking to it!

[jft310]

Pretty gutsy.

[admin]

Pretty gutsy.

Well, yes, but on the other hand, one could argue that all it takes for this to deliver meaningful profits is one (out of three) wells hit something significant (preferably the first one) and the general market sentiment staying benign.

That is doable. I would be surprised if we hit nothing, although assessments about probabilities have differed here quite a bit.

[Putncalls]

Pretty gutsy.

Gutsy? I don't think so. For every dollar IOC could drop, one could almost a hundred dollars on the other end.

EX: I have 70 dollars of unused money. I buy 3 JUN 90 calls for 84$  ( borrow 14$ at 5% or 70 cents pr year)

IOC goes to 100$ on OED. Those three calls pay you 30,000$. I would pay the 70/cents per year and let my extra IOC share ride the wave.

[Putncalls]

I guess the short question is can the PPS go to 100 with methane coated bits ans the slow exit of the shorts?

[kkozkkoz]

Pretty gutsy.

Gutsy? I don't think so. For every dollar IOC could drop, one could almost a hundred dollars on the other end.

EX: I have 70 dollars of unused money. I buy 3 JUN 90 calls for 84$  ( borrow 14$ at 5% or 70 cents pr year)

IOC goes to 100$ on OED. Those three calls pay you 30,000$. I would pay the 70/cents per year and let my extra IOC share ride the wave.

3000 but still good money

[jft310]

Good luck but it's gutsy me thinks. When IOC was $43ish we bought stock but should have bought calls. We did sell some out of the money puts for generous premiums . Being less gutsy The second time IOC crossed above its 200 day average we bought in the money June calls expecting some positive drilling news from any of the wells . Modest bet where we expect return of our principal plus a nice return.

The above said when IOC hit $9 we bought 500 June $25 calls and hit a home run. The volatility I suppose wore thin when we missed the bet at $43ish. Oh well. Good luck!