I am back into the JCP Bond.
music selection: “Keep Yourself Alive” — Queen
I sold the JCP bond last week for a tidy profit at 97. I immediately put in a good till canceled stink bid at 93. Yesterday, I got a fill on one unit. The bond continues to trade around my buy up to price and I hope to snag up to 7 more.
The trade will be in force for 192 days and has an annualized yield to maturity of 20.56%, which is tremendous for something it such a slam dunk risk wise. I’ll be looking to unload the bond again if the price rallies and continue to play the volatility as long as it lasts.
CUSIP 708130AD1 is a BUY up to 93 cents on the dollar.
Devour your prey raptors!
Bought JCP Bond CUSIP 708130AD1
That’s some crazy volatility. Glad you are on the right side of the trade.
Stink bids can have returns just like options do. They pay off in that moment when liquidity goes thin. Do you have a standard practice for stink bids? E.g. set aside cash or let it execute on margin, maximum position size, duration of the order, etc?
I had some cash on hand and it hit my target price. Basically, I’ve watched the price action and see a bond that is range bound between 93 and 97 and I’m taking advantage accordingly.