I just noticed that Helenca Mining HL has topped off and is falling back. We want to stay long in the position, but protect ourselves from a serious retracement. I thought about selling some calls, which is a good strategy in the last two weeks until expiration, but the stochastic is dead bottom flattened out and turning up. Also the selling volume has dried up.
Now take a look at the June 2.5 puts, a plug nickle. In fact the bid and the ask are both $0.05. For every one hundred shares of HL you have you can buy a put which would give you two weeks worth of cheap insurance. I have 100 shares so I'll buy 1 contract.
Buy to open 1 contract HLFZ @ the market!
OK I shoulda known better than to rely on bigcharts for live quotes as the spread widened, bid .45 ask .55 and I got filled at .55.
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