dluxe23
Short

MU put vertical

NASDAQ:MU   MICRON TECHNOLOGY INC
234 views
I bought a put vertical in MU today with 50 long and 47 short strikes for a debit of 1.11 which risks that to make 2.89. I think the market has discounted the China tariff trade war too easily and need some negative deltas in my account. This is a short term trade with more of a scalping mentality and contradicts the covered call I have in UCTT . The risk/reward on the call credit spread did not seem optimal and with news and such even if only volatility increases, I should be able to close for a scratch. Will manage this one as quickly as possible (25%) will be fine.
Trade closed manually: Closed this trade out today into strength for exactly what I placed if for.... 1.11 Just too many people loving on this stock and no need for me to try to hold this down to the wire. Granted October is still a ways away but when theta is working against you it is better to admit you are wrong and look for a better entry or a better trade.

Comments

Nice man. I'm long Micron stock but can definitely see some puts in the short term. I like the portfolio balancing and options input, pretty unique to TV.
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dluxe23 Conchobhair
@Conchobhair, Thanks. Tasty Trade is the best free options/trading site I have ever found. I don't commit to their whole thesis completely but it is great for so many different reasons. Penguins is probably right, but I saw a WSB (wall st. bets) post on another site where the guy had 21K in OTM calls in MU and was taking a lot of heat......when the masses get too long I find the market can turn for no apparent reason whatsoever (The Equal Opportunity Dream Crusher)
+1 Reply
@dluxe23, yep, taking the other side of the popular trade usually pays off in the long run.
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dluxe23 Conchobhair
@Conchobhair, The great thing with options is, with IVR at 23% MU could gap up $3 and down $3 and be unchanged but the options prices would increase due to the implied volatility rise. With a T "tweetstorm" this is entirely possible. It is essentially a long vol trade without the hassle of using VIX products. (I am done with VIX as a product)
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@dluxe23, thanks, I'll have a look. Hope there are no T's ;)
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Penguins83 dluxe23
@dluxe23, that might of been me. I got a real bashing on there only to cash out 33k wealthier :)
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dluxe23 Penguins83
@Penguins83, Lol.....well glad you did well! The post was "Somebody please hold me" You must still have those longer dated 70 calls and you very well could get that pop you are looking for in the next 10 days as they have a 10B buyback. My risk is minute compared to that size of trade.
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No offense but in all honesty a short or put position in MU is almost a sure loss. MU is currently in a reversal and I am expecting a large gap up in the next 10 trading days or less. Sure anything can happen as we have seen but we all know Algos are working hard to expire as many short term options worthless. Good luck!
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dluxe23 Penguins83
@Penguins83, I agree MU has been a momentum name that, even with the large dilution of shares has continued to rocket up without much of a break. The fact that everybody is long this name and with a China trade war possibly in the early stages is what I am looking for........ just a small drop through a seasonal rough patch of the markets. I am long chips indirectly through other trades and need some type of a cheap hedge. I'll take luck any time.
+1 Reply
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