Back in October, I put on a bullish position in Cameco ($CCJ). It was a diagonal call calendar spread: I bought January 2026 $80 calls and sold December 2024 $65 calls against them, paying a net debit of $3.50.
The idea was pretty straightforward: I wanted to own the long-dated $80 calls, but I wanted them cheaper—so I financed them by selling front-month calls.
Had I done nothing after that—just sat on my hands—the short December calls would’ve expired worthless, and I’d still be holding the January 2026s. I’d be down about $1.25 on the trade today. Not ideal, but manageable.
But I didn’t do nothing.
As CCJ started to slide in November, I began actively managing the position. I rolled the short calls five separate times, each time pushing them out to a later month and collecting a bit more premium. Each roll chipped away at my initial cost basis:
By April 16, I had reduced my downside risk so much that the entire campaign had flipped into a 77-centnet credit!. If CCJ continued to go nowhere or down, all my options would eventually expire worthless and I’d actually walk away a small winner.
But… that’s not what happened.
Instead, CCJ rallied hard off the April lows. And because of all my adjustments, my position had morphed into a bearish January 65/80 bear call spread—meaning I now stood to lose money on a continued move up.
The rally turned my carefully managed trade into a trap. I was now at risk of taking a $15 max loss, which was far worse than anything I’d originally signed up for.
So today, I waved the white flag.
I closed the position and took a loss of about $3.00—ironically, just a little less than I would’ve lost had I made zero adjustments and simply let the thing ride.
A whole lot of work.
A whole lot of rolling.
A whole lot of patience.
And in the end… not much to show for it.
That’s how it goes sometimes. Even when your intentions are good—even when you’re managing risk, making thoughtful moves—sometimes the market has other plans. That’s trading.
I don’t regret the effort. I was trying to defend the trade responsibly, and in a sideways or down market, it would’ve worked beautifully.
But the lesson is this: Active management isn’t always the answer. Sometimes less really is more.
Onward.
Sean McLaughlin | Chief Options Strategist, All Star Charts
