I bought SMH puts Thursday. I closed them Friday for a 28% profit. In more sane times, I would have held on to these for many more weeks (they had 49 days left on them) but these are not normal times. These are picking-up-pennies-in-front-of-the-steamroller times.

One reason, besides general ennui and paranoia. is that the main driver of this drop, Intel (INTC), is approaching decent support. This drop might be a one-day wonder.

Let’s face it, valuations are beyond all measures of insanity (see AMD’s very sensible price/earnings ratio below). Instead of a 28% gain, SMH puts should ultimately throw off a 500% gain, but the past 18 months have been far too brutal to keep my fingers crossed.

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