Wednesday, 17 February 2016

Options Trades - GM

I believe GM is significantly undervalued but because I do not have much USD, I didn't buy shares. Instead, I bought a call option that gives me the right to purchase 100 shares of GM at $30 on or before September 16, 2016. This privilege cost me $181.21 (including commission).

Feb/16/2016 Bought 1 GM Sept 16 '16 $30 Call @ $1.75 ($11.20 commission + $0.01 SEC fee)

2 comments:

  1. ADY,

    Hell yeah! I'm glad that I am not the only one buying calls. I just closed out my Mar 4 GM $28.50 call today. I probably should have used a longer time period to give GM more time to rebound...LOL win some lose some.

    MDP

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    Replies
    1. This is my very first experience buying a call. At first, I didn't really like the idea because i had to fork out $$$. But when i looked at what you were doing, i realised that one's losses are limited, especially when compared to selling puts.

      What was funny about this week is GM stock price being positively correlated to the price of oil. But history shows sales of big ass SUV increase when oil is low - and that's where GM's profits come from. Anyway, I hope it makes it to the mid 30's where i will STC my call and probably off load my 100 shares.

      Take care

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