$HLF short using puts @ 7.60
Updated
Used Oct 4 exp 7.50 puts as a short play on HLF. I went short on SNAP today (and wished I hadn't) because it was my 2nd choice and I couldn't get a fill on these all day long at .25. Finally at the close I bumped up my bid and got them for .30.
I like this better than the SNAP trade because HLF has been going down since mid-2021. It's near its 3 year low, but 3 year lows don't have a good history of support with this stock in the last few years. Plus it filled the Feb '24 gap down and then failed lower afterward.
I'm looking to close the trade as soon as it becomes profitable at the close of a trading day.
The stats over the last 2 full years are:
26 short signals
24 wins 2 open (last 2 days)
19 of the 24 closed trades (stock only) would have closed profitably in 5 trading days or less. The average gain on a short was 3.5% and the median was 2.7%. If you take out 2 very long trades which though profitable, would end up as 100% losses with options anyway, the average hold period was 3.8 days for all the rest of the trades, and the median hold period was 1 day including those long ones.
I like this better than the SNAP trade because HLF has been going down since mid-2021. It's near its 3 year low, but 3 year lows don't have a good history of support with this stock in the last few years. Plus it filled the Feb '24 gap down and then failed lower afterward.
I'm looking to close the trade as soon as it becomes profitable at the close of a trading day.
The stats over the last 2 full years are:
26 short signals
24 wins 2 open (last 2 days)
19 of the 24 closed trades (stock only) would have closed profitably in 5 trading days or less. The average gain on a short was 3.5% and the median was 2.7%. If you take out 2 very long trades which though profitable, would end up as 100% losses with options anyway, the average hold period was 3.8 days for all the rest of the trades, and the median hold period was 1 day including those long ones.
Note
Sold the put for .40 at the close. +33% 1 day trade. Couldn't have worked out much better except that the bid/ask on these HLF options was .35/.45 so I had to split the difference and couldn't get the probably .42 I should have gotten but I'm not complaining. Happy with how my analysis and execution worked on this trade. It was my preferred short yesterday and it performed beyond my expectations with the stock dropping over 3.5% today. Trade closed: target reached
Meant to do the "trade closed" thing with the comment above but forgot to, so I'll do it here.
Trade summary (for my records):
Wins 1 Losses 0
Long put --- Oct 4 7.50 put
Stock return during hold period = -3.62% in 1 day
+33% - 1 day trade
Avg. gain +33%
Avg. hold = 1 day
Gain per lot per day = 33.0%
Annualized return per lot per day = +8316%
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