STP up $31,000, LTP down $25,000 - all is well.
GILD/Stock - Still reasonably priced at 17.5 x earnings and that's prior earnings - this year they are on-track for $9Bn against $89.5Bn market cap. We have GILD in the LTP but only 10 of the 2023 $50/65 bull call spreads with 5 short $50 puts which, of course, is all in the money now.
As a new trade for GILD, I'd go for:
- Sell 10 GILD 2024 $60 puts for $7 ($7,000)
- Buy 15 GILD 2024 $60 calls for $16 ($24,000)
- Sell 15 GILD 2024 $75 calls for $8.50 ($12,750)
- Sell 5 GILD Jan $72.50 calls for $3.65 ($1,825)
That's net $2,425 on the $22,500 spread, so there's $20,075 (827%) upside potential but we only used 123 out of 851 days to raise $1,825 so we'll get the basis down below $0 as time goes on. GILD is not likely to pop 10% ($77.50) but, if it did, you'd owe back $2,500 so not a very risky short call strategy and, of course, at $77.50, you'd be on the way to a $20,075 gain anyway.
Silver/Stock - Well we have WPM in the LTP, still good for a new entry as it's a $30,000 spread at net $5,500 so "only" $24,500 (445%) left to gain if all goes well - even if you missed out on our net $500 initial entry. Silver streaming is only 1/3 of their revenues with Gold being pretty much all the rest (Palladium is the end of it).
| WPM Long Call | 2023 20-JAN 35.00 CALL [WPM @ $41.02 $-0.21] | 20 | 2/8/2021 | (487) | $23,500 | $11.75 | $-2.20 | $11.75 | $9.55 | $0.01 | $-4,400 | -18.7% | $19,100 | ||
| WPM Short Call | 2023 20-JAN 50.00 CALL [WPM @ $41.02 $-0.21] | -20 | 2/8/2021 | (487) | $-13,500 | $6.75 | $-3.05 | $3.70 | $0.06 | $6,100 | 45.2% | $-7,400 | |||
| WPM Short Put | 2023 20-JAN 40.00 PUT [WPM @ $41.02 $-0.21] | -10 | 2/9/2021 | (487) | $-9,500 | $9.50 | $-3.30 | $6.20 | $0.15 | $3,300 | 34.7% | $-6,20 |
PAAS is a good miner and didn't lose money last year, so I like them but $5Bn at $24.26 vs not even $200M in earnings in their best year (projected to go to $400M+ next year) means you have to really buy into the expansion story.
