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November 21, 2009
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Close Supertex (SUPX)
March 19, 2009"Buy to close" the SUPX March 25 Puts (SQOOE) for $3.20 or less
Fellow Options Traders,
On Jan. 6, we recommended selling to open the Supertex (SUPX) March 25 Puts (SQOOE) for $3 or more. We had learned that Microchip (MCHP) had been selling the same puts for the past six months.
With SUPX stock around $22, it is virtually gauranteed that MCHP will be put this stock and its ownership will climb to more than 9% from the current 6.1%. Our original thought was that MCHP had put a floor on the stock and that MCHP might soon declare some bigger plan. Unfortunately, no news has come from MCHP, yet, and the stock is trading at $22.
So, with March expiration tomorrow, we recommend exiting the position by "buying to close" the SUPX March 25 Puts (SQOOE) for $3.20 or less. We'll walk away flat on this trade and look for another way to win big money on the next trade.
Have a great day trading.
Nick Atkeson and Andrew Houghton
Editors
Options Trader
