hedging question

[Chuck Krug]

hedging question

hi guys,
i know there's a lot of knowledge here.
Just wanted to discuss
Have a net short exposure of 20k in stocks
would like to hedge with calls
currently bought 10 spy jan 185 for 0.37

any opinions on this?
Thanks

 

[nazzdack]

Quote from Chuck Krug:
----hedging question....
----lot of knowledge here.
----net short exposure of 20k in stocks
----hedge with calls
----bought 10 spy Jan 185 for 0.37
----opinions?

1) You'll have some "protection" in the event of a seasonal Christmas Rally.
2) The market ought to be "weak" the first few days of January with carryover tax selling.