Hello Investors,
We took a more aggressive bearish hedge today. Last week we entered into a QQQ trade and exited the next day at a loss. Today we can put on a better trade (larger credit) with even better levels. In addition, we are buying puts to go with the naked call. The naked call is one of the most aggressive (risky) strategies in the market. So, it is critical that one understand how to hedge, adjust and manage risk.
Sold to open: QQQ Sep 18th (monthly) 312.00 strike calls
Credit: 2.20
Bought to open: QQQ Oct 16th (monthly) 295.00 strike puts
Debit: 12.22
Bought a 1×3 call spread against our BAC shares.
Bought: BAC Oct 16th (monthly) 27.00 calls (ratio of 1)
Sold: BAC Oct 16th (monthly) 30.00 calls (ratio of 3)
Debit: 0.11
Have a great week!