Options Play: Buying Call Spreads in Silver with Prorective Puts
Friday, November 13, 2009
by Matt McKinney of Zaner
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OPTIONS PLAY: Buying Call Spreads in Silver with Prorective Puts
This article focuses on a bullish option strategy in COMEX SILVER.
MY ANALYSIS
Fundamentally, COMEX SILVER should forge new highs in the coming days and weeks for 3 basic reasons.
1. Weaker U.S. Dollar
2. Inflation Hedge
3. Investor Demand
Technically, 2 out 3 MA's are pointing upward and they are in the proper formation for an UPWARD TREND.
See daily chart below.
WE ARE BUYING CALL SPREADS IN SILVER!
OPTIONS PLAY
MARCH SILVER-$17.41/OUNCE
OPTION EXPIRY-FEB 26TH
CONTRACT SIZE-5,000 OUNCES
LEVERAGE FACTOR-$1=$5,000
BUY MARCH 20-21 CALL SPREADS
We also buy in a 3 to 1 ratio an outright PUT in case the market makes a MAJOR move against us.
FOR 25 PROVEN OPTION STRATEGIES CLICK HERE: http://www.zaner.com/3.0/mmck.asp
THE BEST SERVICE I CAN OFFER YOU AS MY CLIENT IS WHEN TO GET IN AND WHEN TO GET OUT!
Call or email me with your phone number for a detailed explanation of the strategies 312-277-0115 or mmckinney@zaner.com.
Futures, options and forex trading is speculative in nature and involves substantial risk of loss. All known news and events have already been factored into the price of the underlying commodities discussed.
The limited risk characteristic of options refers to long options only; and refers to the amount of the loss, which is defined as premium paid on the option(s) plus commissions and fees.
Matt McKinney resides in Chicago, Illinois. He has specialized in full-service options trading since 1998. He can be reached at 312-277-0115 or mckinney@zaner.com.
Matt has extensive experience trading options on the energies, metals, grains, softs and 30-year bond market. His strategies include time frames of 45-120 days with the ability to liquidate at any time. The downside risk in the strategies recommended is limited and pre-determined.
Matt's experience includes both fundamental and technical research. He formulates a specific market recommendation and strategy, while ensuring that the client understands the potential reward as well as the risk. If the client understands the trade, risk and potential reward, then the parties move on the trade.
From that point forward, Matt watches the trade every step of the way. He keeps the client posted on a regular basis and recommends when to take a profit or cut a loss. It's up to the client to make this decision based on the research provided.
Matt understands that this business is based on building a long-term relationship with the client, not only being a hardworking broker, but a friend as well. So, whether you're a novice trader who wants to participate in options on futures or an experienced trader who doesn't have the time to sit in front of the screen all day, Matt McKinney can help.
