Investor's Opinion

Portfolio Update: Option Pick

Published: 2013-06-09 22:48:00 EDT by Unknown

Today I am posting about my latest transaction. This transaction is a bullish option trade on BGS. The options I BTO are the $35 August 17, 2013 Calls. Normally, one would want to buy the options ITM to take advantage of the immediate leverage. Unfortunately, I am playing with a minimal amount of free cash so OTM Calls were my only choice.

The trade processed as the second half of a contingency trade. When BGS traded above $29, I bought the options at $0.10 per contract share ($10/option) . I chose the $35 strike because my target for BGS within the next couple months is about $32. And the available intervals for the August Calls are $2.50 apart.

My plan is that when it breaks $32 I am taking the money and walking. I think this is likely. I probaly should have set my purchas for $0.05 per contract share as the following day that was the last purchase price, putting me behind already. I still thik profit is possible. That's my opinion. What's yours? Disclaimer: See bottom of page.

BGS - B&G Foods Inc.
BTO - buy-to-open / bought-to-open
ITM - in-the-money
OTM - out-the-money

Labels: call options, option picks

Updated: 2013-06-09 22:48:51 EDT