Quote:
Originally Posted by trader220
Vols in the utilities are so low there is almost no premium. Similar in the big pharma.
What's funny is looking at the price of the AMZN atm straddle that expires tomorrow with earnings today. Now that's some serious premium dollars. The 1722.5 straddle went out at about 85 bucks today. Just think you could have sold 10 straddles and taken in $85k in premium. The stocks around 1730 now after earnings so the straddle is worth $7.5 intrinsically, and it expires tomorrow. EZ money right?
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The problem with Amzn, tesla, nflx, particularly with straddles, even strangles, is that you can easily get your face ripped off. However, selling a five lot atm put in ED, or Pfe, can easily net you $1.00 per contract, or $500.00 Is it a lot of premium, no, but, if you can create 3-5% per month, that annualizes out pretty good. It's a better bet than the financial planner who puts you into products that make him $$$$$$$$$ even though you lose your A$$.