I bought a bull call spread on MDLZ.
music selection: “The Sentinel” — Judas Priest
weigh-in: 192.2 (1.6)
Mondelez (MDLZ) is a snack and beverage giant. Really sort of a boring company with low volatility. It is also in a strong uptrend that shows no sign of abating. I bought the 59.5/64.5 bull call spread with 20AUG2021 expiry today for 4.1383 per share (12 spreads), putting 4,966 in capital at risk over 26 days. I have 1.85% downside protection in the trade. Should that not be breached, I will earn the full profit of 1,034 in 25 more days. That is good for 20.8% or 292% annualized.
In my HSA account, I sold everything, booking a 76% gain on basis (plus an untracked amount of distributions). I have put all that in SPSB, a short term investment grade corporate bond fund. The yield is paltry and might not even keep pace with inflation. I’m basically just parking “cash” somewhere as an allocation towards Nasem Taleb’s “barbell” strategy. I will hold cash and equivalents until the next 50% or greater market correction. Upon confirming a 30 day uptrend, I will deploy the entire amount (about 13k) into UPRO. Should make 6 times my money in 18 to 24 months if the Fed stays true to the new playbook.
All August expiring positions are in the money and I’m pacing 13,865 in profits for the month. One September expiry position is in the red and the month is pacing 1,867 in profits. I have one October expiring position that has 2.74% downside protection and is slated to earn 4,061 for the month. I have a good till canceled stink bid on a December position as a fishhook that is unlikely to ever fill.
Devour your prey raptors!