<p>I bought the appl 430-425 put spread in a ratio of 5 by 10 for a .22 credit.</p>
<p>So I would be long 500 shares of aapl at 419.78 Trading around 445 as I write this. </p>
<p>Many possibilites on how this spread can work. At 425, on paper, I can make $5 on the spread, but in reality, that won’t happen. I could make a dollar or two though which translates into $500 to $1,000.</p>
<p>If the spread goes out worthless, I make $90. </p>
<p>Blackberry is over 14. I prefer that to 12.15. :)</p>
<p>You bought the spread for a .22 credit? How do you get a credit for buying? Or did you sell the 430 put and buy the 425 put? I’m confused on this trade.</p>
<p>I didn’t buy the 430 puts and sell an equal amount of 425 puts. </p>
<p>I sold twice as many 425 puts as I bought 430 puts. </p>
<p>So… I bought the 430 puts for 1.84 and sold 2 times the 425 puts for 1.03 each, or 2.06 total. </p>
<p>1.84- (1.03x2)= 1.84- 2.06= -.22. Therefore, a 22 cent credit. I did it 5 by 10. I did the ratio 5 times. 5 x .22= 1.10. Multiply this by 100 because each option represents 100 shares.</p>
<p>That is $110. Minus $20 in commission…I got paid $90 to do this trade.</p>
<p>I could have just sold the 420 puts because the downside below 420 is similar to my trade. I did not want to do this because before expiration, above 420 the trade is very different. I could make more money above 420 before expiration with this ratio spread.</p>
<p>I know this is a lot of info…if you don’t understand this, we can go into this trade in more depth. Or we can forget it…</p>
<p>This trade has a lot of risk, if the stock drops below 420. Which is why I am not doung this trade in a bigger size. 
I don’t think the stock is going to go below 420 this week, but it might. I have to be willing to be long the stock at 420, even if the stock drops to 380.</p>
<p>If you are selling puts or doing buywrites you are taking similar types of risk.</p>
<p>Now I understand. That’s an interesting trade.</p>
<p>Ok…great…</p>
<p>
</p>
<p>[U.S</a>. to sue S&P over ratings ahead of financial crisis | Reuters](<a href=“http://www.reuters.com/article/2013/02/04/us-mcgrawhill-sandp-civilcharges-idUSBRE9130U120130204]U.S”>http://www.reuters.com/article/2013/02/04/us-mcgrawhill-sandp-civilcharges-idUSBRE9130U120130204)</p>
<p>I am thinking these stocks may now be a buy. DOJ will not likely win unless they come up with some new theory. Many courts have held that rating agencies are merely giving opinions that others can take or leave. I guess I will have to follow Dad II’s three day rule for sure.</p>
<p>Interesting development, razorsharp.</p>
<p>[Look</a> the Other Way](<a href=“Look the Other Way | Insights | Fisher Investments”>Look the Other Way | Insights | Fisher Investments)</p>
<p>Back on 2/1, I sold RIMM 2/8 12 puts for .20 - perhaps expecting an opportunity to buy it at 12 - I guess not.</p>
<p>Really?..</p>
<p>Obviously not now - I guess it was wishful thinking. I’m looking at selling ddd 2/8 55 puts for .2 but it looks like its down to .15</p>
<p>Interesting discussion about aapl on cnbc: [Apple</a> ‘Worth a Lot More’: Damodaran - CNBC](<a href=“http://video.cnbc.com/gallery/?play=1&video=3000145993]Apple”>http://video.cnbc.com/gallery/?play=1&video=3000145993)</p>
<p>You sold those Rimm puts for .20? Really? On 2/1? Where was the stock?</p>
<p>That was a really crummy sale. :)</p>
<p>I’m still looking for the entry point to short RIMM/BBRY.</p>
<p>It was at 13.03 in an uptrend. It would have been nice to get it the day before but I’ll still take .20 rather than 0.</p>
<p>Doct, sorry. I thought you said a different week. Thought you were playing some games…</p>
<p>Razorsharp, do you think that blackberry phones will fail or you just think the stock hs gotten ahead of itself?</p>
<p>The scariness of this market continues… 1 day after, Stocks’ worst day of year sends Dow below 14,000 we go right back up.</p>
<p>This market will make millionaires out of all of us! We used to say that inflation would turn us all into millionaires.</p>
<p>^^you’re making scary comments. Fortunately not a lot of people are making these comments yet. Back in 2000, I heard people say including me, the stock market only has to go up a bit more and I can retire - this was a sign of a top.</p>
<p>“We used to say that inflation would turn us all into millionaires.”</p>
<p>That’s not good.</p>
<p>doct, the .20 sale is not crummy. I thought you were talking about the 2/16s(which didn’t make sense). A .20 sale in the 2/16’s was crummy. :)</p>
<p>I have an order to buy another aapl ratio put spread. The 2/16s. </p>
<p>Appl probably has to drop about 12 bucks in the next day or two to get a “guaranteed” fill. I don’t think that is going to happen. I am a little outside the market. That’s ok. Maybe I will get lucky and get filled anyway. These strikes are more out of the money than the last trade.</p>