12/12/2021 Plan:
This week we look at AMD (Ticker: AMD)
12/12/2021 Plan (continued):
- AMD- Sell the Jan 14 115/110 put spreads for 0.48 OR
- AMD- Sell the Jan 21 115/110 put spreads for 0.56
- JPM – Sell the Jan 7 150/145 put spreads for 0.57
- INTC – Sell the Jan 14 47/45 put spreads for 0.21 (half size)
- Prices are as of market close 12/10/2021, actual fill and strikes may differ depending on Monday’s open, post will be updated accordingly.
- All trades are for educational purposes and do not constitute advice
12/12/2021 Commentary:
AMD has been pretty volatile recently and that volatility is beginning to subside (see chart above). This trade assumes that realized vol continues to come in. I’m long term bullish in AMD and would add shares near 115 anyway. This is a riskier trade, given how much AMD has moved, so size accordingly or pass.
JPM – fairly straightforward play that assumes JPM won’t end below 150 by expiration. IV is well above HV and this trade looks to take advantage of that.
INTC – If you would rather continue with INTC (vs. AMD), this narrow spread in January has an acceptable risk vs. reward. With the big moves last week in INTC, I would go with a lower size than normal. Also note that there is an active trade in INTC expiring this week – make sure you close out of that first or you’ll be doubling your exposure to INTC. For smaller accounts, I would not put both the AMD and INTC trades on as you may have too much exposure to chip names.
Feel free to Reach out with questions on this or anything else!
12/13/2021 Entry:
Sold JPM Dec 31 150/145 put spreads for 0.48.Sold AMD Jan 7 115/110 put spreads for 0.49. Both 1 week earlier than plan. Sold INTC Jan 14 47/45 for 0.25 as well. Would do INTC OR AMD unless you have a larger account.
12/19/2021 Update:
JPM put spreads are down just a little. We will hold this week and they should be profitable if JPM can maintain its current levels.
We are currently profitable with the AMD put spreads and have $23 buffer before we hit our short strike. With three more weeks I will hold to try and increase our profit on the position.
The INTC put spreads are currently profitable. Plenty of time on this position so we will hold.
12/24/2021 Update:
The JPM put spreads are performing quite well and are worth 0.12. The underlying is about $7 OTM. While closing for a profit is rarely a bad idea, I’ll look to close a bit later in the week, ideally for 0.05 or less. Reminder these options expire this week.
The AMD put spreads are only worth 0.04 and we still have two weeks on the trade. While it is Unlikely that AMD will drop more than $30 in 2 weeks, I’ll probably close the position this week.
The INTC Put spreads are still profitable, now worth about 0.10. We have three weeks left, so if you need to re-allocate capital go ahead and close these as 0.03/week isn’t that much.
1/2/2022 Update/Partial Close:
The JPM put spreads expired worthless, adding $48 of cash per put spread sold.
I closed the AMD put spreads for 0.02, rather than waiting another week to collect $2. This was a $47/spread winner. Feel free to close or leave them open as they are unlikely to lose.
The INTC put spreads are performing well, I’ll look for a cheap close early in the week.
1/9/2022 Close:
As mentioned in last week’s update, I looked for a cheap close and got it – $0.02 on Monday for a $23/spread winner. This was a smaller size position, but still added nicely to our accounts!
