Tuesday, February 28, 2006

Buying Premium

To reiterate I am not an official bear but I am putting our fund's money into long SPY April puts right here. To quote a master sci fi story teller Bradbury, "Something wicked this way comes".

Note that I am making a minor commitment here as I don't like selling tops on broad indices. Also, I am looking for a very short term bounce in Oil and Housing that could be actionable from a long call perspective.

Dismal action in Biotech and I am watching 195 level on BBH as a tell. So far it's a retracement among overall weakness, but it easily get worse. If the market gets weaker but this level holds I'll look to add to our short put positions.

Stay tuned.



At 3:00 PM, Anonymous Anonymous said...

The actual source of the quote "Something wicked this way comes" is Shakespeare's MacBeth, Act IV, Scene 1; one of the witches says it in reference to MacBeth as he is about to enter.

At 10:12 PM, Blogger Dmitry said...

Ah, I am glad the quote is even older than I had thought. Well, that only makes it more meaningful... and I guess SPX is our incarnation of MacBeth, for the time being.

Thanks for the pointer :)



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