Sold to open a quantity of 10 uncovered puts, symbol- xomwz. Exxon Mobile Corp Near Term Nov 22nd 35 strike puts at .18 leaving me with a credit to my account of $180 minus commissions. My feeling was that even if I got put the stock there at $35 per share, that means that I would own the stock 50% cheaper than today's closing price and if I don't get put the stock, I'll keep my profits of $180 less commissions. Earnings and warning should be coming out soon and this stock may drop, but my hunch is that it won't drop this low and if it does I will reassess whether or not I want to keep it in my portfolio of stocks to own long term or sell it right out or wait for a rally to sell it, but let's first see if I get put the stock. I rarely day trade and I put on options positions until they expire or I get put the stock unless a material fact has changed in my mind compared to what I was thinking when I entered the trade.
That is why I like to inform you of why I make the trades that I make, so that I can think clearer by writing them down. It's good to know why, in case something changes later, I will remember why I entered the trade in the first place and it will let me know if the scenario has changed dramatically enough or had a material impact on what I was thinking when I entered the trade. This is my way of knowing whether or not that I should reverse my trade at any given point!
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