I was looking at my CMC option position just before lunch and decided to place a stop order to secure some profits as it was up to $6.30. I was going to set $6 for today.
By accident, and I have VERY seldom done this, I sold the option at a limit of $6 as I forgot to select the STOP box.
The only good side is that at least I got the $6.30 price so my profit was $1.20 per share. I had been considering selling the option as the stock has hit a recent resistance level at the $18 to $18.50 zone...it was as high as $18.65 and I suspect that it may have more room to move...another $1 I had aimed for anyway.
Seeing as I dumped my CAH put option side of the straddle this morning for a loss, this one covers that loss and change. The call for CAH was increasing at a much loser rate than the put was decreasing... the discrepancy was due to the spin off and symbol changes. I may look for another long straddle for next week, or at least after this run up has run it's course.
I had considered dumping both sides of the straddle and starting with a different call for CAH fully expecting the price of the stock to rise following the change, I decided to save the extra commission and just hold the call that I already had.
Having said that, I would have bought calls that were closer to the strike price, or even the first call that was out of the money. These calls are far cheaper which leads to another thought about ATM call trades.
Jeff.
Questrade, My direct access discount broker.
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