Stock Option Investment Advice

Stock vs. Married Put Position Analysis

Married Put Profits Compared to Stock Only Profits: Using married puts to protect and insure a stock position has certain risk / reward trade-offs.  Each position is a little different. Your profit results will depend on your stock selection, how much risk you take with the purchase of the put, and what income methods you apply to the position.  Two different investors taking positions in the same stock will likely have different outcomes just because of their individual choices for strike price of the put, what income method to apply, and when during the hold cycle to apply the method.  Recently an investor wrote to us about some profit concerns with one of his marred put positions: “The stock DB was bought 10-4-16 using the Married Put.  The stock is up 57%.  I am only showing a 16% profit because of the Put.  Granted Hindsight is 20/20.  I realize this…

Stock Option Investment Advice

Gilead (GILD) War Story: I Learned A Trading Lesson On This One

Several months ago I purchased Gilead Sciences (GILD) in my married put Fusion account. This is an investor war story about this position and some lessons I’ve learned as a result of doing a regular quarterly review of my holdings. But before I get into the lessons learned, I need to share some background information that led up to the purchase in the first place. During the December 2015 to January 2016 time period the entire Biotechnology sector was under pressure and most stocks in the sector declined. But February 2016 brought some stability and consolidation. During the February to March period, volatility declined, Bollinger Bands narrowed, and MACD turned positive. I thought, It was clearly time to consider