Thursday, March 08, 2012

Buy XRT (sell puts)

Buy XRT (retailer ETF) via adding another layer of short puts XRT Apr 54, XRT@59.9. I am already short XRT Apr 52 puts and Mar 53 puts. My thinking is any stock market decline will be contained around 10% and the 54s are 10% out of the money. Beta is about 1.0 for XRT.

Elsewhere, MCD (McDonalds) hits an air pocket. My short MCD Mar 92.5 puts still look to be safe. IWM (Russell 2000 ETF) continues higher, again my delta is showing slightly negative. Hmmm. For now I will sit tight on both of those.

The question in my mind: Is That It? Was that one day smash in the stock market all the correction we are likely to get? A few folks got nervous on the decline, while some others looked for stocks to buy.

net short GLD
* long BRKB
* short GDX
* delta is near zero on these positions

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