Hello friends,
My AMD has run up a lot and i would like to hedge similar to "zero-cost collar" McMillan strategy, but with some variations.
My main goal is to protect my profits while allowing a stock to rise.
I prefer not to sell stocks so I delay taxes. I am also not looking to sell options for income.
I am bulling for AMD for the long run, but want to protect profits against pullbacks.
Here are some strategies I am considering:
1. AMD Jun 18th 330/410 Collar (zero cost) - I allow for pullback to 330 but 410 upside cap feels too low. the close expiration does not allow to set Call strike higher, if I am looking for zero cost
[https://optionstrat.com/5vr8dbP4DYzT](https://optionstrat.com/5vr8dbP4DYzT)
2. AMD Dec 18th 330/440 Collar - later expiration allows 440 Call (zero cost)
[https://optionstrat.com/csRLXEfpfo1Q](https://optionstrat.com/csRLXEfpfo1Q)
3. AMD Dec 18th long 330Put short 550Call short 260Put (zero cost) - same as previous collar, but I sell 260 Put to move the Call higher to 550. (the image is of this strategy)
[https://optionstrat.com/8uhTo7UxKUSH](https://optionstrat.com/8uhTo7UxKUSH)
I would like to hear your thoughts and also:
1. How do I manage this position (say, second 330/440 collar ) if AMD:
1.1 drops to 280?
1.2 runs to 480?
How would I roll the options if i prefer not to sell?
2. How do I compare each strategy - is there a composite metric I can use? like %upside cap vs risk?
3. The earnings are in two days I understand there will be IV crash right after... so how can I adjust?
Any other thoughts?
Thanks a lot!
https://preview.redd.it/luite4hsvxyg1.png?width=1178&format=png&auto=webp&s=b31e293aa93218fe733d270532d65d671a6ae71a