MCM May 2012 FINAL disposition of action for expiration tomorrow.
We should have no probelm with any of our positions except possibly the following.
TRLG -The stock is currently trading at $27.95, $0.05 out of the money. We can
look to close tomorrow on any type of flat to up opening, however if we get a down opening
you might decide to hold onto your short $28 May call longer, especially if if looks to
be hanging in the high $27.80 - $27.90 area. You could also decide to wait until close
and determine how you want to dispose or close out the position.
If you are not going to be able to wath the close tomorrow, you can either close out during the day or in the morning or with a MARKET ON CLOSE order.
NOTICE: If TRLG looks to close under $28, you will need to do NOTHING as the the May $28 call would expire worthless.
DMND - This issue is basically identical to the TRLG position, the Short DMND May $23 call is $0.03 out of the money,so we will still have to watch this one just like TRLG.
Additionally, we have a put spread with a short strike of $27, so one of several things could happen.
You can close out the call side if we open flat or down for a few cents.
_ - OR -
If DMND opens down in the mid $22.40 - $22.60 area, hold both the short calls until the close and if the stock is between $22 and $23 at the close, you need do nothing as both put and call will have expired worthless.
Of course if DMND closes above $23 we will have to close out the $23 Call option for a few cents or if DMND is under $22 will will have to call out the put for a few cents.
We can do that on the open or you can wait until near the close to see
where the stock might end up.
REMEMBER: The stock can not end up at the close both higher than $23 and lower than $22 so we will have to do one of four things.
Close out the call at the close, if DMND is over $23.
Close out the put at the close, if DMND is under $22 at the close.
Close out both anytime during the day and not waiting to figure out which one you MAY have to close.
- OR -
Do nothing if the stock looks to close between $22 and $23 at the close tomorrow, which there is a good chance of happening.
Anyway that is the disposition for tomorrow.
Also as a reminder, if something unusual happens tomorrow on the up side, or to any one of our other issues; if any one of them should look to close above the short call strike, be sure to close them out before the end of the day, although it currently looks unlikely, but if it should happen, you might have shares of stock called away that you probably do not own and would have to buy to deliver, with money that you may or may not have.
So, to avoid that problem, be sure that if ANY of the other issues look to close above the short call strike tomorrow, please close it out before the close fo the market tomorrow.
NOTICE: Although I will be sending out additional
June recommendations this weekend, I will be also sending out 2-3 later this evening as well.