Should I sell covered call or cut loss?

Discussion in 'Trading' started by trend2009, Apr 11, 2021.

  1. I have lots of position in biotech, all are in deep loss. Since the index is at all time high point, I am afraid if index goes downside, biotech or other growth stock will go down even further with it, even though they are in bear trend when the index is at ath. I am still not decided if I should cut loss or sell covered call to pocket the fat premium of biotech stocks.any idea?
     
    Last edited: Apr 11, 2021
  2. deaddog

    deaddog

    Where do you stand to lose the most money?
     
  3. what do u mean?
     
  4. maxinger

    maxinger


    based on the limited info you have given,
    this is how to fight the fire :
    - spray CO2 on the fire ( cut loss)
    - pour gasoline on the fire so the fire continues to burn
    so as to have even more sleepless nights.

    after you have close your position, have a clear mind.
    Then decide what to do with your trading career
     
    Last edited: Apr 11, 2021
    trader99 likes this.
  5. deaddog

    deaddog

    If the trade goes against you.
    If you sell the calls and the stocks drop.
    If you sell the stock and it drops.

    I always ask myself how much can I lose on any trade. Limit your losses.
     
  6. MKTrader

    MKTrader

    Not sure, but you better have a plan if you sell calls. What happens if your stock suddenly shoots up? Are you willing to have it called away (sold) at a large loss? If not, will you buy your call back at a loss and/or roll it out further?
     
  7. Nobert

    Nobert

    Depends on what you're holding & how deep in the red are those.
     
    Last edited: Apr 12, 2021
  8. zdreg

    zdreg

    Your remark is fallacious.It is called the sunken cost fallacy or in the vernacular throwing good money after bad instead of cutting your losses. The market doesn't care about your position.
     
    deaddog likes this.
  9. "1st Rule of Holes"... when you find yourself in one, stop digging.
     
    El Trado likes this.
  10. Nobert

    Nobert

    That might be true in intra day, but not swings.
     
    #10     Apr 12, 2021
    Omer1235 likes this.