Even the best of trades can fail at times. There are dozens of factors that affect stocks. Everything from earnings to key managers leaving can affect a stock’s performance and subsequently a trade that should have worked, fails.

An investor emailed wondering about his trade in L Brands Stock which trades under the symbol LB. The earnings for the latest quarter failed to meet expectation and for the first time in years, Victoria’s Secret brand saw a sales decline. This sent investors into a selling frenzy. Let’s review his question and then look at some suggestions.

Investor Questions:

Dear Teddy,

I need your advice on repairing an option trade gone wrong. I sold 20 put options on LIMITED BRANDS (LB) may 20’16 75.50 put strike for $2.88. The stock is now trading at $61.67. Can you suggest me a repair strategy at least preserve my capital or make a small profit out of it?

Best regards,  Jerry

Jerry emailed in his question. I often suggest investors with questions post them to Teddi’s Help With Trades where members can post questions to my website and answers are posted back. This removes the possibility of spam filters or mail servers failing to delivery emails. It is a great way to get a hold of me and to know that your question was received.

Preserving Capital In A Failed L Brands Stock (LB) Trade – May 20 2016

FullyInformed Members can read the latest investor questions strategy article directly through this link or they can sign in to the full site here. Non-members can join here or read about the benefits of a membership.


Disclaimer: There are risks involved in all investment strategies and investors can and do lose capital. Trade at your own risk. Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed and presented are financial or trading advice or recommendations. Everything presented and discussed are the author’s own trade ideas and opinions which the author may or may not enter into. The author assumes no liability for topics, ideas, errors, omissions, content and external links and trades done or not done. The author may or may not enter the trades mentioned. Some positions in mentioned stocks may already be held or are being adjusted.


 

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