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Not an option expert, but would focus on the potential timing of future events that would likely influence ioc price. And stay out in time.....
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Payment date talk is second half of 2015 . That's the biggie . Sell the time premium with a short put sale Jan 2016 . A sale of a $60 strike put only requires the stock to remain flat to collect the premium. Buying a $60 call requires the stock to rise . The best time to have bought calls was when the stock was $43. Options are risky should be a small bet . The long stock position doesn't expire worthless like a long call option can . Be careful .
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JFT, if I bet all your comments I would be down much more than I am already. That being said, I feel the future is bright for IOC!
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Selling puts is risk control vs call buying . Worst case you own more stock going into a bullish event . Tbe payment receipt. Buying calls requires the event to happen when you predict and the stock to rise the amount you predict .
The middle ground is to sell puts collect their money and buy calls with their money .
Today we don't know the time of the payment nor the amount of the payment . Making month selection and strike price selection difficult . Ninety percent of call buyers lose money .
We are short Jan 2016 puts and expect them to expire worthless.
When playing the option market the key is to have some marbles left if wrong to play the game again.
Several RJ brokers whipped out their client portfolios with call buying . They were trying to make up lost ground . Last month I received a private message from a jan 2015 call buyer who had well under water strike prices . Thus the problem with call buying.
If someone wanted to buy say $57.50 strike calls in Jan 2016 that's a fair bet . Buying out of the money calls for the summer of 2015 seems risky to this option trader . The Jan 2016 strike $57.50 options can be rolled up when things are more certain. Example when Ant 4 results are announced if bullish sell the $57.50 calls and buy in the money calls again at a higher strike .
That's how to lever your portfolio and control your risk and be able to play the game again.
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Good advice, methinks, James F. Thanks
