29 results for tag: puts


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 ...

1/3 chance

Today the market was weak again for most of the day. We took advantage of that weakness to increase our short cash covered put vertical on XLP. We sold another single contract spread, so our position is now "short four XLP 50/48 Feb Put Verticals". We have sold them at an average price of .675 and the price to buy the vertical back is now at .625. The position has begun to go profitable as time decay increases a little bit every day. If XLP is weak again tomorrow, we would place orders to increase it to 5 contracts. The trade is working and XLP continues to remain at the top of our relative strength ratings. It's OK to buy on any weakness.  Rem...

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 ...

The small portfolio

I have an IRA account with about $3400 in it. Many of the trades here at DPO require a six-figure account. We understand that many people need to learn the business of options in little steps. If you want to develop your skills properly - one small step at a time - then please start small. I'm using this IRA for our Small Portfolio.  We have analyzed XLP, which is the Select Sector SPDR Consumer Staples ETF. It is traded in very large volume and has enough option open interest for our purposes. It has the strongest relative strength of the major SPDR funds and that's why we are focusing on this one for now. The other day, we sold a Feb 50/48 put ...

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 ...

Resolution

Yesterday, we talked about the Apple and WalMart positions. Today, we have resolution of those two positions. The three short WMT 76 puts will be allowed to expire so that we will keep the entire $72 that we took in when they were sold. As I write this, there is one half hour left to the market close. WalMart is trading around 77.40 so we are nowhere near the $76 strike price. Yes, we could buy them back now for a penny or two and remove all risk. There is nothing wrong with taking that path and many traders would have rules in place that require the closing of the position. We are sitting on  plenty of cash, so the tiny risk of assignment (if the ...

WalMart dividend

Tomorrow is WalMart's Ex-Dividend date. We were short some shares and did not want to pay the dividend. (Yes, if you are short - you pay the dividend!). There are many strategies to handle this, including just paying it. We decided to buy some shares and sell calls, setting up a covered call to end the day with only option positions. No shares owned, no shares short. It's paying us about $60 a day with little Delta risk. Our profit since inception is about $360. This concept of the Ex-dividend date is very important to understand. WalMart goes Ex-dividend on May 7. Anyone who owns shares prior to that date will become eligible for the dividend. (It ...

An Apple a Day?

Last time, we started talking about a simple method for trading Apple. We had closed all of our open positions and ended up out of the position. After closing the 535 put for 5 cents on January 17, I opened a new position. AAPL was down about $15 from the previous day, so it was within the rules of our simple trade. On that date, a 540 put was sold for $5. This was closed on the 22nd for 50 cents, resulting in another profit of $450. Why close it for 50 cents? This was a weekly option that was opened on a Friday. The next Wednesday our $5 position had dropped to 50 cents with 2 days left and it didn't seem worth 50 cents risk to the end. We had made ...