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.
AMC is trading just over $15 as I write this. I would like to collect another round of call premium this month.
My suggestion today is to Sell to Open (1) January $16 Call for 27 cents for every 100 shares you own.
If you do not get filled at 27, which was the last trade, you can always lower the bid to 25 cents.
Assuming you get filled at 27 cents, you will have collected $2.25 per share in call premium.
This is about 15% of the purchase price.
And if the calls are assigned, you will earn an additional 4.7%.