While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Today I am going to suggest you sell calls against your DUST position.
DUST is trading around $4.06 as I write this and we can collect some premium going out a week.
Which is what I am going to suggest.
Sell to Open (1) March 24th - $4.50 call for every 100 shares you own.
The March 24th- $4.50 calls can be sold for $.25.? Current bid / ask spread is $.20 to $.35, so you should be able to collect $.25 per share.
Assuming you sell the calls for $.25, that will mean you will have collected $.60 per share in option premium.
