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IA | Nothing inherently wrong, just don't get your best and worst case scenario confused:
Best case you see market prices rise, you sell $4.70 corn and benefit from the premium.
Worst case markets go lower and you're only left with the premium (i have heard people brag about all the market premium they collect as markets fall and they never sell their crops, that's not a great scenario).
The tricky part is sometimes markets go up a little bit (say to $4.60) and you'd like to sell but if you do sell you'll be short the $4.70 call, potentially with no corn to cover if prices keep going up. Knowing this you don't sell only to see prices drop.
I'm not advising you NOT sell the calls, just make sure you think thru how much to sell and what you'll do in various scenarios. | |
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"come and get me" strategy? selling calls now in corn
