Options Expiration day – a look at Pioneer Natural Resources

For those familiar with Option trading you will find the following graphic of no surprise:

PXD_Aug08w_Options

Bid/Ask spreads. Ugh.

I am currently short the $230 Calls (2x, left over from a Call Ratio) and short the $205 Puts. One of the challenges on expiration day is to have the patience to let the bid/ask spread tighten so that you can close an Option in a reasonable way.

At the moment price is above $206 so the short Puts are OTM (out of the money). I obviously would prefer to not pay to buy them back (BtC – Buy to Close) and instead have them expire worthless. It seems the short Calls above will have no problem doing that ūüôā

Promise & Pullbacks

I have 2 stocks in the Fab 5 that have had a distinct difference in performance this week. Both have been on the team for quite some time, have completed the 100 Roll, and I have noted that they would be kept on with a tight stop.

The stock with continued Promise is NKE (Nike Inc):

The stock in a Pullback is PXD (Pioneer Natural Resources):

PXD did hit a trail stop on Monday, February 27, so that position is now closed. I do have MELI as the 6th man to pick up the slack. Good job PXD, the 100 Roll complete, and now time for a new participant soon.  

Also SHW completed Day #3 this week Рthe 100 Roll is now complete there. I will leave in place for now with a tight stop.

 

The Fab 5 – update

Called up MELI from the bench (6th man) to replace FDX as it hit a stop on the pullback on Friday (2/17). Both PXD and NKE had Calls sold against that expired Рand will leave them in and do the same for March. ROP will be given one more week for the 100 Roll, otherwise it will be replaced. SHW did breach 100 on Friday but closed below Рso close, battle stations!