Option Investor


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TIME TO ROLL OUT THE QQQQsGood Morning Everyone,

Just returned from a great CPTI seminar in California. A truly excellent group of bright and willing attendees. A lot of knowledge and a lot of laughs were shared.

Well, it's that time again -- time to roll out our QQQQ ITM Strangle short term puts and calls.

As of last night's closing prices, we could sell the June $37 calls for $.45. Remember, we closed that for a nickel about a week ago. Our net roll out credit will be about $.40 for our calls.

Then, we could buy back the May $36 put for $.15 and sell the June $36 put for $.55 -- netting a profit of about $.40 for our puts.

If we're successful in this rollout, we will have netted a total of $.80 ($800) for the June rollout and we will again be short the $37 calls and $36 puts.

The futures this morning are pointing towards a down opening, but these net figures should still be available. Isn't it interesting that, after all the smoke clears, the QQQQs seem to gravitate back to the middle of our LEAPS trading range? It's a variation of the "regression to the mean" theory.

If you want to be creative with your roll outs, we have a number of additional strike prices to work with this month (all the .625s).

Good luck and trade smart!


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