MNK - Promising Opportunity (High Time Value Puts)

2018年2月26日

I think MNK looks interesting at this price. Price has been driven down. Could potentially continue to fall, but in long run, this could be a good potential buy opportunity. Time will tell.

The IV% on short dated put options are much higher than normal. I sold a couple 3/2 $15P for .80/contract (3 days till expiration)

B.E. (or purchase price if exercised) = $14.20
MNK $16.30

GREEKS
D / G: -.0980 / .1606
T / V: -.0188 / .0038
IV: 171.29% (vs. 56.87%)

W

2018年2月28日

交易進行

Stock price initially moved higher after earnings, but has since given up it's gains. Based on the chart, there looks to be pretty good support between current price and $15p. IV% has been decreasing, indicating consensus is reduced vol (movement) ahead.

Regarding the $15 Puts I sold, I had the opportunity yesterday to close positions for .05/option, but I passed thinking I would simply let the the options expire worthless. I didn't expect MNK to give up all of its gains. Now, MNK is currently price the same as when I originally sold the options. However, due to IV% down by 40-50 and time decay, it looks like I can close (buy back) my position for less than .15/option. (STO @ .80). While that would still make for a substantial profit for a 2+ day trade, due to price support and fundamentals of stock (I'm more neutral than bearish), I plan on passing on closing the position.

My Plan Of Action:
- I would definitely strongly consider BTC @ .05 & probably up to .10. I may place a limit order to see if it gets executed.
- If price stays above $15 by end of day Friday, options will expire worthless if positions are still opened.
- If options are exercised and stock price is $13 or higher, I am fine with selling calls. As long as the bottom doesn't fall out, I should be able to make a profit and potentially increase overall trade profit.
- If stock price falls below $13 before Friday, I'll close position for a loss.