DBA - Agriculture

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Keynes's picture
User offline. Last seen 8 years 4 weeks ago. Offline
Joined: 02/27/2009

Continuing to find positions to place covered calls.

I like DBA because it should participate in any economic recovery and has a low risk.  It's a commodity that people actually need which is a rarity these days.  Additionally, it will be fairly inflation sensitive and should participate in any inflation plays.  My main concern is that it may be like USO where I'm seriously cutting off my upside with the call, even though it leaves me with low risk.  However as of today, selling covered calls at 23 leaves me in the situation where it would have to make a new low for me to feel any significant loss, and a 1.3% upside in a month.  Seems like a safe play, even if I get left behind (again).