late to the rally? SELL puts
May 05, 2009
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RELATED TICKERS: BP
, PVR
Reprinting this point from another blog of mine. It wouldn't surprise me if there are alot of people out there who stayed on the sidelines of this rally, wished they gotten into it but are afraid to enter at this point. While I still submit it is not too late to buy the energy stocks since many are still closer to their lows than even their midway point, one way to do it is to buy that initial stake. Then simply sell puts for the stock at the lower prices you wanted. If the stock continues to rise well you made a profit at least and you keep the put premium. If the stock does drop, well you still keep the premium and you get the stock at a discount to its current price.
The kicker is you do have to have the funds available, don't do it "naked."
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