12 results for tag: down


Jan 20 <> Down 400 again…….

In my options portfolio, I track the available cash by subtracting the value of all the short puts (as if they were exercised - because they might be) from my cash. Today, that leaves me about 25% in cash. I don't want to go any lower, so I will only be selling premium (calls) against the portfolio until cash is back closer to 50%. I never use margin, I'm not smart enough for that. My account value is down about 5% since Jan 1, while the S&P is down 9.4%. If I was a mutual fund I would run an advertisement trying to convince you that is good performance. I'm not going to convince anyone that a 5% drawdown is good. I don't like to see it, but it ...

Jan 15. Down 500.

Years ago I resisted the Dot Com stock boom. I knew that stocks were being valued in crazy ways, I knew it had no fundamental basis. Eventually, I joined the party and played the game. I lost a whole lot of money and suffered an extended medical depression. The mental anguish was absolutely terrible. At one point, a person who was helping me through it all told me that he thought I would trade again. It took me a long time to get back in the waters, but I did - with a horrifically painful lesson learned. That lesson? :: Markets can move farther and faster than you ever dreamed. Ever since then I've kept this lesson first and foremost in mind ...

Jan 13

After closing the WalMart puts for 5 cents, we waited until a day when WMT was down 1%. We got it Tue and Wed and have a new position that is short three 63 puts, expiring Friday. This position needs to be rolled now, on Thursday morning. We have placed an order to roll this out for one week at 48 cents and subscribers will be getting the price adjustments as we click them lower during the day. We like to try and roll weekly options on Thursday so we avoid getting pushed into the last few hours of a contract. The market makers know that you want/need to roll on that last day, so pricing deteriorates. Sometimes we end up rolling expiring weeklies on ...

End of the week Jan 8

Our WalMart (WMT) trade worked well this week. We sold cash secured naked puts at an average price of 45 cents and they expired. We kept the entire profit on our 3 contracts, or $131 after commissions/fees. This is the best possible result for a weekly trade. It does not often happen so don't assume that you can do this week after week. Most trades need adjustments and rolling forward (more time) to work out profitably. Trading options is work that requires planning and patience. It is not gambling! We will watch WMT for a day when it is down at least 1% and then sell naked cash secure puts again. Subscribers get those trade alerts before they are ...

Expiration Friday

We have a number of positions that need adjustment today. No Apple. We are out for now. WalMart - WMT continues to be sold heavily, but the chart tells a different story. Walmart is in a strong bull market so we let the chart, NOT the market, tell us what to do. Today we buy. (Subscribers get trade details as the orders are entered). We also need to roll our short puts that expire today. We are rolling the 84 puts, the 85 puts, and maybe the 86 puts. Both the 84 and 85 are close enough to the current price of $83.82 that we can roll for enough money to meet our criteria. The 86 strike - maybe not. We may let those shares be put to us and sell ...

Market Movement

We were in and out of Apple again. The portfolio has no position today, yearly profits in AAPL are now $12,594. We had sold some weekly 110 puts and yesterday we bought them for 5 cents each to close the position. Now, we wait for a day when Apple is down a few dollars. At that time. we will look for a high-probability strike and sell some puts. Until that happens, we stay out of this symbol. As a broker friend of mine once said "Patience produces profits". He was right, The WalMart position has taken a hit as WMT has moved lower over the past few days. Our charting system shows Walmart to be in a strong Bull market - so down days are welcome ...

Updating WalMart and Apple

After moving, I got busy and was not able to continue writing for DeepPocketOtions. That project is now under control and there are many trades to talk about since October. Starting with WalMart - our profit for the year was $1130 on October 3rd.  We continued to trade the options, moving in and out of various put, call and stock positions over the last two months. Our profit today stands at $2001 for the year, so it's earning about $350 a month now.  That's a respectable income created from simply selling a few put positions on days when WalMart happens to be down. The current position is short 1 weekly 84 put and short two 86 puts - all expiring ...

The 3 Choices

Buy, sell, hold. As a trader, these are your only 3 choices, all the time, for every position. There are 3 possible results, too. You profit, you lose, you break even. The number 3 is the single most important number for a trader. The Monty Hall Problem refers to the game show, Let's Make A Deal. In the game, you are confronted with 3 doors. You have one opened for you - and then you can keep what's inside or give that prize back and switch to another door. Your hope is to improve your position with the second choice. The Monty Hall problem proves, mathematically, that your chances of success are increased when you switch doors after the first ...

Ending XLB

We are nearly out of XLB. The trade has gone very well, we are up $458 and now only short 2 May 46 puts. These 2 put contracts can be closed for about 20 cents, so we could potentially make another $40 or so, if we let them expire in 21 days. The risk reward is not in our favor now as the maximum we can make is $40 while our maximum loss is many times that. If, over the next 3 weeks, XLB drops to 43, we will see our short puts lose $300 for each contract, or $600. We don't like those numbers. If you have the potential to lose $600 or more, you must have enough compensation to make that risk worth holding. So, we will close the remainder of the ...

Ignore it.

The market is up big one day, and then down big the next day. We try our best to ignore it and trade according to our plan. You know Warren Buffett always says that he doesn't pay a lot of attention to daily market swings. That is not his plan. He buys good companies cheap, and waits patiently. Of course, he has enough power to influence the Board and the operations of said companies, should he choose to do that. On the other hand, some people DO trade the daily swings, and that is their plan. They like the excitement of the quickly moving game. This is the game that most people fall prey to - and they lose everything as they watch their account being ...