Back in April of 2009 we took a full position of SKF at $68.90 as part of mother of all puts, in case the Plunger Protection Team lost control of the market. The SKF closed Friday at $85.33 so, right now we are sitting on a profit of $16.43 share. It is time to place stops for this position.
I like to place stops in gaps, the reasoning is obvious. If SKF is going to continue to the moon, then you would not expect it to fall back into the gap right away. Friday's low was $79.98. So, let's put our stop at $79.58. Hopefully that's far enough away from any ambitious market maker specialist to keep us safe.
04-20-2009:
Buy SKF 100 @ $68.90
Stop @ $79.98
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