So there are times that I am glad I didn’t actually put on a position. This is one of them. Take a look at the current state of CFC(0.00 +0.00). This stock is just getting hammered, again! Today it dropped $0.78 or 9.6% – there wasn’t really any real news!
Personally, I’d be getting a little shaky here. There are roughly 9 days left till expiration and CFC is really, really close to the break-even on this trade. I’m not exactly sure what will happen, so I’ll keep posting updates as we move along. Remember, this is not a trade that I recommend by any stretch… This was simply an interesting idea on a weak company to build a synthetic covered call by selling a put on CFC.
As a company CFC(0.00 +0.00) has a lot of problems. It could go bankrupt and you would be liable for $750 for each contract you shorted. If you’re selling insurance, just realize that sometimes you have to pay out! Anyhow, fun times. Lets see how it plays out.
