3 results for tag: put


Our WalMart trade is now working

We track our Profits and Losses on a weekly basis. Every Monday, we fill out our form and take a detailed look at each position. There is NO reason to hold any position that is not making you any money if you have built an options portfolio. The point is income, options decay over time, and should be paying you every single day for the risk you have accepted. Stock ownership does not do this. Over the last 10 weeks, we have averaged about $250 a week on this position. In order to get to this status, we had to work on correcting a losing position for the first 5 weeks. A beginning trader would look at that period and have a hard time dealing with the ...

WalMart Bear Market Ends

We analyze our positions weekly to determine their trend. The Walmart trade turned against us soon after we opened the position, as our position was based on the current trend when we started, which was a bull. Within 2 weeks, bull turned to bear. There are some obvious choices when this happens. You can close the trade and get out, which would have worked well. You can just stop adding to your position and let some time pass. Or, you can continue adding in a very cautious way as you determine if the new bear will be short lived. We chose the latter, and the bear market continued to work against us, lasting about 9 weeks. We use a position size limit ...

The WalMart Options trade continues….

Today, I sold 3 more Jan2 14 78 Puts. One at 39 cents, the second at 42 cents, and the third at 45 cents. The 7 contract position now has an average price of about 38 cents each. The contract is trading at 44 cents, for a 6 cent loss. If closed today, the entire position would lose $42. This is a small and manageable loss. The sales process, where I opened the position at 30 cents and continued to sell all the way to 45 cents today, works well as a risk management tool. When I originally started this trade, if I would have sold the same 7 contracts at 30 cents, I would be down $98. This position has two days left to expiration but WalMart is now ...