Tuesday, May 2, 2017

New Strategy for investing in Under Armour Inc. (UAA) and Monster Beverage Corp. (MNST)

On March 24, 2017 my blog entry Under Armour Inc. (UAA) Opportunity I talk about my purchase of 100 shares of UAA on 2/6/2017 for $20.55. I have decided after the most recent quarter where UAA had a better than expected results losing .01 instead of the expected .04 to go with a different strategy.

The new strategy is with options. It comes with risk but also will free up cash. We all know cash is desperately needed and I have many ideas. I have done this before with AMZN blog entry I used options in place of owning the stock. What this does is allow you to use less overall cash to own the same amount of shares. The risk is higher as options are based on time and have time decay they can end up worthless.

Lets look at UAA $21.05 as of May 2, 2017 I put on the trade May 1, 2017.

I purchased 2 options
The first Oct 20'2017 22.5 Call for $1.26 ($126 to control 100 shares. Anything over $23.76 by Oct 20th is Profit)
The second Jan 18'2019 20 Call for $4.15 ($415 to control 100 shares. Anything over $24.15 by Jan 18 2019 is Profit)

So I sold my common stock of 100 shares to buy these 2 options... The second giving me quite of bit of time for a turn around. I think the company will rebound this year hints why I bought an option expiring in October.

I will continue to update to see if it works out.

I also have liked MNST for awhile and sold my position for a profit but wanted to get long without have so much cash tied up. I do think there could be a takeover sometime in the future thats why I want exposure plus it is a well run company. The product is quality and popular.

I purchased an option Jan 18'2019 45 call for $7.20 ($720 to control 100 shares. Anything over 52.20 by Jan 18 2019 is Profit)

I continue to work on the Stocksnowball Portfolio to get it updated on google numbers. I will have Current long positions, Dividend info, Lifetime earnings which will be dividend and capital gains/loss on closed positions or trading around a core position, and a Watchlist. It will be password protected for those who follow me and interact on my profile. Contact me for more info.

Disclaimer: This is a personal weblog. The opinions expressed here are my own. All data and information provided on this site is for informational purposes only. Please do your own research before investing.

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