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Playing & Trading Strategy

Here is my .02 I will use a fictional MOVIE with a strike of 20 which means

Posted by: StarBondFund on Dec 15, 09:16 in response to Flash's post That is true...

that if you buy the call at 2, you are hoping it makes more than 22.  If you buy the Put at 2 (IPO) you are hoping that it will make less than 18.  (ignoring the commission)

If you short the call, you are hoping it makes less than 20 and if you short the Put, you are hoping it makes more than 20.

These are not mutually exclusive events.  A win on the purchase of a call, also is a win on the short of the put, since greater than 22 is also greater than 20.  A win on the purchase of a Put, is also a win on the short of the Call, since less than 18 is also less than 20.

Generally, if you think that MOVIE will do better than the strike, and you can afford the action, you long (buy ) Call and short the Put.   If you think that MOVIE will do Less than the strike, you buy the Put and short the Call.

In virtually every pairing, one of them delists at zero, and the other is greater than zero, and hopefully, greater than 2.  The trick is to guess the zero and be doing it correctly more often than incorrectly.

NOTE  Occasionally, the movie delists within 2 of the strike price, and you lose on both the put and the call.  You could short them both, but that is REALLY risky, unless it is a strike of 5.

 





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Furiosa: A Mad Max Saga H$55 Put (MMAX5.PU) 82 2.33 (-0.02)          Jamie Foxx (JFOXX) 147 79.59 (0.00)          Furiosa: A Mad Max Saga - Openin (MMAX5.OW) 208 58.87 (+0.63)          Not Another Church Movie (NACM) 1 2.09 (-0.09)          Furiosa: A Mad Max Saga (MMAX5) 29148 146.07 (+2.86)          Not Another Church Movie (NACM) 148 2.09 (-0.09)          Riddick: Furya (RIDC3) 150000 13.93 (-0.13)          The Fall Guy (FALGY) 150000 82.70 (-0.37)          In the Grey aka Untitled Guy Rit (NGREY) 143596 30.24 (-0.14)          Furiosa: A Mad Max Saga H$55 Put (MMAX5.PU) 25000 2.33 (-0.02)          Eric Bana (EBANA) 177 31.51 (-0.25)          Furiosa: A Mad Max Saga H$55 Put (MMAX5.PU) 25000 2.33 (-0.02)          Force of Nature: The Dry 2 (FNTUR) 1 0.30 (-0.02)          Furiosa: A Mad Max Saga (MMAX5) 95667 146.07 (+2.86)          Furiosa: A Mad Max Saga - Openin (MMAX5.OW) 100000 58.87 (+0.63)          IF (IMGNF) 150000 135.22 (-1.16)          IF (IMGNF) 150000 135.22 (-1.16)          Companion (CMPAN) 150000 18.54 (+1.77)          Last Days Of John Allen Chau (LDJAC) 150000 5.39 (+2.91)          Riff Raff (RIFRF) 150000 8.26 (-2.18)          The Entertainment System Is Down (TESID) 9999 22.92 (+2.22)          Back to Black (BTBLK) 150000 15.34 (-1.05)          Back to Black (BTBLK) 150000 15.34 (-1.05)          Back to Black - Opening Weekend (BTBLK.OW) 100000 5.07 (-0.55)          Fantastic Four (FANF2) 12249 161.61 (-0.60)          Back to Black - Opening Weekend (BTBLK.OW) 100000 5.07 (-0.55)          Matthew Macfadyen (MMACF) 25000 64.22 (-0.25)          Masters of the Universe (HEMAN) 75000 37.90 (+0.76)          Asphalt City (BLKFL) 150000 0.68 (-0.06)          Asphalt City (BLKFL) 150000 0.68 (-0.06)          Hitpig (HITPG) 150000 5.38 (-1.40)          Nobody 2 (NOBO2) 150000 16.92 (+0.12)          Peaches (PEACH) 150000 3.49 (+0.03)          Uproar (UPROA) 150000 0.69 (-0.02)          Not Another Church Movie (NACM) 150000 2.09 (-0.09)          I Saw the TV Glow (ISTVG) 150000 3.09 (+0.20)          Not Another Church Movie (NACM) 150000 2.09 (-0.09)          Nobody 2 (NOBO2) 829 16.92 (+0.12)          Last Days Of John Allen Chau (LDJAC) 83921 5.39 (+2.91)          Peaches (PEACH) 100000 3.49 (+0.03)          Wicked (WICKD) 150000 159.87 (+1.55)          Peaches (PEACH) 150000 3.49 (+0.03)          Snack Shack (SNACK) 100000 0.45 (+0.01)          Furiosa: A Mad Max Saga (MMAX5) 150000 146.07 (+2.86)          Force of Nature: The Dry 2 (FNTUR) 152 0.30 (-0.02)          Snack Shack (SNACK) 150000 0.45 (+0.01)          Haikyu!! The Dumpster Battle - O (HAIKY.OW) 100000 5.00 (0.00)          The Wedding Banquet (TWEDB) 150000 10.00 (0.00)          The Entertainment System Is Down (TESID) 150000 22.92 (+2.22)          The Entertainment System Is Down (TESID) 150000 22.92 (+2.22)