Saturday, December 18, 2010

Precious metal positions

All my SP and SC expired for December.

Most of my silver positions are running naked.

If the price goes up on Monday, I will be running naked until it hits a resistance and I will add a SC.

If it goes down on Monday, I will be initiating a collar for all the positions i.e. selling a SC 2 strikes up with 2-3 months timeframe and  > 45 days ATM put.

Once the stock reaches a support level, I will add a SP, roll down the SC. If the support is right, I will let go the LP.

This process will continue until the metal finds a direction. If bullish, it will be running naked again.

This will give you an idea of how I trade my positions dynamically in a collar.

These are not for beginners. For those who are not sure, just keep the collar and protect yourself. You will still make good money if the stock continues to go up. 

If there are signs of a parabolic breakup, take out the SC for a loss and let it run with a married put ( stock + LP).
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About Me

An engineer by training graduated with B.Sc (hons) and MBA from Strathclyde university in Glasgow, Scotland. Started as an engineer in R&D for 3 years with Philips. Then, worked with DuPont for 13 years. Last job was VP, Marketing for Asia Pacific. Left to start a number of companies in various segments which include a large electronic distribution, a VoIP provider, an internet trading portal in Australia,and an executive training consultancy firm. Have listed companies in NYSE, Australia Stock Exchange, Singapore Stock Exchange Main Board. I was on the Board of Directors for 1 company listed in Thailand, 1 in Singapore and 1 in Australia. Was in the senior management of a company listed in NYSE. Still holding major share positions in the VoIP and Executive training companies. Both are private companies.

Disclaimer

These articles merely reflect the opinions of this author and are by no means a guarantee of future economic conditions, market or stock performance. Though the author strives to provide accurate and relevant data, he sometimes relies on external sources and cannot assure the reader of the accuracy of these external sources. Additionally, these articles are provided for INFORMATIONAL PURPOSES ONLY and are NOT MEANT to provide investment advice to anyone. For investment advice, please consult your professional adviser.