Yesterday, September 4, on the first day of trading after the Labor Day holiday, Corn made a sharp move up, closing at 353.2, up 13.2 points. December Corn had been up as high as 357, but had at least come off of its highs for the day by the close. So, with December Corn closing within proximity of my mental stop at 351, I decided to hang on to this contract one more day and sell the next day if prices were again up. At the close of trade on September 4, my 320 put option had a value of 6.125 cents or $306.25. That gave me a loss of $68.75 on the trade before commissions.
Fortunately, today, September 5, December Corn closed down 7.4 cents at 345.6. Prices also closed near the low of the day of 345 so that suggests we may see further downside action in corn over the next few trading days. However, with the volatility of the grain markets these days, who knows? Anyway, at the close of trading today, my option had a value of $400 which gives me a profit of $25 before commissions.
No comments:
Post a Comment