Made a quick 22% profit. I am now back, fully unhedged on GDX. Gold looks to bounce here and the market looks like it wants to roll over further, which should drive gold and GDX up.
This is why selling calls to protect yourself doesn't work unless you are selling deep in the money calls and you plan to hold them over time like I am doing with SLW and AA.
22% on 2 calls at $1.40 is a $60 gain. Minus $12 to buy the calls and $12 to sell the calls = $36 gain.
A $36 gain on a postion that $7500 (GDX) does not warrant a blog post and is not hedging... :)
That being said, I think you may be right about the downside on GDX being more limited at these levels.
This is why selling calls to protect yourself doesn't work unless you are selling deep in the money calls and you plan to hold them over time like I am doing with SLW and AA.
ReplyDelete22% on 2 calls at $1.40 is a $60 gain. Minus $12 to buy the calls and $12 to sell the calls = $36 gain.
A $36 gain on a postion that $7500 (GDX) does not warrant a blog post and is not hedging... :)
That being said, I think you may be right about the downside on GDX being more limited at these levels.
I love it...I get called out by my own blogging mate. ;)
ReplyDeleteOh, it was $80 I made too, you bastard. ;0
ReplyDelete