I have a substantial set of 1050 puts on NVDA expiring this week which, in hindsight, was an extremely foolish decision (based on the strong reaction to earnings, dividend increase, stock split announcement, overall positive outlook of upcoming economic metrics this week, etc). Looking for some recommendations of various approaches I can take to reduce my losses. Here are the options I’ve been contemplating. Any help is appreciated.
1) Cut losses tomorrow morning – realize an almost 67% loss on capital.
2) Roll forward to a longer dated expiry (maybe 5-6 months out) and then sell monthly puts against it to take up put diagonals (not sure if this is the right terminology). Aim would to be try and recover capital.
3) Wait it out and see how the week plays out.
I know this was extremely foolish given that I basically ate theta decay for free over a long weekend. I’m already kicking myself over it so I would appreciate some kindness. Thank you!
Edit 1: Average cost of $16.92 per contract.
NVDA 05/31 1050 Puts guidance
byu/constantlyUncreative inoptions
Posted by constantlyUncreative
3 Comments
I also got 3 puts in the last 3 hours on Friday, but NVDA just kept soaring high. I’m hoping for a pullback by Tuesday or Wednesday; otherwise, I need to close it for a big loss.
I mean, surely it has to retest 1030/1050 once, right?
How does rolling forward avoid realizing the loss?
They won’t be worth much in the morning. NVDA +$24.50 2.33% currently $1,090