Sell General Motors Calls on Bounce

By Linda McDonough • October 3, 2018

The last-minute agreement which includes Canada in the NAFTA trade agreement is sending the market higher. As the delay in this agreement weighed on auto-related stocks, I expect a bounce this morning.

Sell to close the October 19, 2018 call on General Motors (NYSE: GM) with a strike price of $37 at $.15 or higher for a loss but some return of capital. (prior alert incorrectly said out flat). Symbol (GM181019C37)

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Karl

Karl

Just saw the alert. Until now no email or sms. Sold for $.09 (highest was $.21 today). Loss of 82%.

George McMillion

George McMillion

Think I am correct, if you opened this trade on Sept. 05 you will pick up the $.38 dividend in addition to the closing credit.

Phil L.

Phil L.

No alert

Stuart Housden

Stuart Housden

Hi Linda, your message reads like it was prepared prior to the market opening. However, the e-mail didn’t show up in my in-box until 10:13 (and the SMTP alert was even later at 10:48), by which time the opportunity to cash out anywhere near the limit you recommend was long gone. I know you prefer to wait until you see an option trade at your recommended limits before sending the alerts, but in these cases where “I expect a bounce” it might be more helpful to send a more conditional recommendation earlier – e.g. so that it arrives in our in-boxes prior to the market opening.

SuperDave

SuperDave

I’m out of AGN and NXPI today for a $2,876 loss. I hope to break even in the next several months. How’s everybody else doin out there? All I ever see is people posting how much they bought their options for, never how much they sold them for, or their profit. Any jackpots out there?

KenRetiredSCAZ

KenRetiredSCAZ

Here is what is currently in my portfolio based on Linda’s recommendations:
All of these figures are based on owning only 1 contract, obviously I own more but that’s not the issue here.
CC down $185 per
GM down $47 per
F down $11 per
HD down $297 per
LOW down $2.81 per

MGPI up $120 per
TAP up $11 per
SAM up $280 per contract but I don’t think any of us own it!!!!

To Linda’s credit she did issue a sell notification on both F and HD that I didn’t see in time to get out of. So I’m still sitting with them watching them continue to go down the tubes.

I hope this answers your question, you’re not the only one losing and I’m sure that’s no consultation to either of us?

Stuart Housden

Stuart Housden

I started trading the PCA recommendations in January, only trading the options plays. There were a string of back-to-back total losses, which I have made back some of, but the way the current holdings look, getting back to zero is still some way off. Here’s my results:

Jan:
CELG – 100% loss
SAIA – 100% loss
WERN – 100% loss
Feb:
ODFL – 100% loss
TGT – 100% loss
BIG – 63% gain
FB – 62% gain
Mar:
CC – 91% loss (this was rolled over and looks like it will be a 100% loss)
HSC – 72% gain
CRTO – 45% gain
OMC – 39% loss
SNAP – 68% gain
Apr:
HSC – 79% gain
WMT – 53% gain
DG – 17% gain
BIG – 99% gain
ABBV – 61% gain
Jun:
CC – Will be 100% loss unless something changes soon
Jul: no trades taken
Aug:
HD – 33% gain
LOW – 40% gain
CENT – 18% gain
NXPI – Will be 100% loss unless something changes soon
Sep:
F – 26% gain

There are still some trades open of course. The record looks to be break-even, but because the big losses came at the start my trading capital was depleted so I was not able to take similarly sized positions in the successful trades that came later, so I am still behind. I should add that I was not always able to follow recommendations for entry or exit – sometimes the market had got away from me by the time I received the alert – so my results are different from Linda’s posted record. One telling point is that if I had put in a hard rule to exit any position once it dropped in value to 50% then I would almost certainly be profitable at this stage (I have not checked to see whether this rule would have sabotaged any of my wins – I don’t remember any trades that came back from being 50% down, but I am not able to watch the market all the time).

Hope this helps.

Bill D

Bill D

Sold GM for $0.07 and forgot to click All or None so for 5 Options I paid 2 commissions. Losing deal all the way around.

C.B. Cessna

C.B. Cessna

Thank You Linda for what you do. I appreciate you.

Daniel Long

Daniel Long

Hello, Linda.
GM was listed 0.07-0.09 today, but I was hoping for 0.10-0.12 and did not go down. Do you think the GM bounce is over or can we hope for a little more (0.10-0.15) in the next day or two? Thanks.
DL

Steve S.

Steve S.

Daniel,
I’m watching to see if the news of the Honda investment in GM’s self-driving car unit gives the shares a boost this morning. Hope springs eternal.

C.B. Cessna

C.B. Cessna

Sold GM @ .09

Daniel Long

Daniel Long

Linda,
Thanks for the surveillance.
Got 0.12 on the GM GM 37 call this morning (Thurs 10/4/18).
DL

Phil L.

Phil L.

Sold at .12

In reply to Dave and Stuart

I started in May and would be at a breakeven except I tend to deviate from her recommendations and think before I act.

Typically I make a small buy at the outset and wait to see the direction in which it travels. I also check to see what is going on at the next level. Take the AGCO trade. I have puts at the 55 per Linda, but when it went in the wrong direction I bought the 60 for an extra dollar per. That extra dollar got me four dollar net of swing. If Linda is right I will clean up. I have done this on several other trades. I lose a little more if it goes the wrong way but the positive on the other end has more than negated that. I have also looked and went further out on the trades so we are not all crowded in the same space. Too many people in one spot inflates the price. I always look that premium paid vs other trades for different time frames. Any one who blindly does this is just that. I like Linda’s thoughts and methodology. As Linda has stated she will not always be right and even if she is it may not be in the specific time frame.

Stuart Housden

Stuart Housden

Thanks Phil – some good tips. 🙂

Phil L.

Phil L.

Your welcome Stuart.

Linda McDonough

Linda McDonough

I may have to put Phil on the payroll.

As I’ve mentioned many of you are more sophisticated in options trading than I. My expertise is in fundamental research. During my quarter-century tenure at a hedge fund, the timing on positions is always the hardest part.

Best,
Linda

MarkS

MarkS

Closed GM @$0.11 for 82% loss.

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