7 results for tag: trader


XLP, WMT, Jan 12

XLP was mostly unchanged today, so we did not try to add to this position. The 4 contracts in our small portfolio (under $4k account) are starting to earn a little profit. This is exactly what we expect for a vertical that is about 5 weeks from expiration. We are waiting patiently for time decay to work it's magic on this position. Patience Produces Profits. Our short WMT puts were expiring in a few days. We placed an order to close them at 5 cents, and it was filled. Entering a closing option order at 5 cents or less is commission-free at ThinkOrSwim. We originally sold the put contracts at an average price of 45 cents, closed them at 5 cents, ...

Updating the WalMart trade – now almost profitable.

When we last left our WalMart trade, it was down $520 (last week). Yesterday, we closed down $155. We collected Theta over the weekend and then the position improved by $300 today. Our Delta is near zero and Theta is about $32.50 a day. Remember, we were sitting on a -$2500 position on February 10, when Walmart closed at $73.76. Today, the close was $77.38. With our program of option selling around the core position, sometimes selling calls and sometimes puts, we have the same gain we could have made by owning 700 shares. That was done without actually purchasing the shares. We don't own any shares right now, we are only short options, some puts and ...

How quickly things change…….

This is being written during a big market drop on April 10. Right now, the DIA is down about 1.25 %. Yesterday, the market was up - quite a bit - on the Fed minutes. Tomorrow - Who knows? The point is that you need a business plan for your trading so you can ignore these daily movements. I do have CNBC on without the sound every day, and I was thinking earlier today -- Does CNBC EVER report that "Things are just ho-hum today with not much going on? "I'm not sure I have ever heard that. It's always a high energy discussion of something that is moving wildly and that kind of focus completely distorts your thinking. If you have a plan, you just trade ...

The WalMart position shrinks

I thought it best to update the WalMart trade one more time this week, as things changed a little bit today. We were able to close our short 76 weekly puts (expiring tomorrow) for 5 cents yesterday. Our broker, ThinkOrSwim, has a special feature that you may not know about, but it's something you should nearly always take advantage of. They encourage you to close any open short option position when it decays to 5 cents by giving you a commission free transaction. That's right. You can close any quantity of short options for 5 cents or less - for free. There is a very important concept behind this - let me give you an example. Our 76 puts were sold on ...

GE Update, trading Gold?

Today, our 500 share GE covered call position is showing a profit YTD of $782. We are enjoying a daily time decay (theta) income of $4.20. We decided to try and add to our position today by selling another put. That order is still open and has not filled. Subscribers get the details of this trade. What about Gold? There is huge trading volume in the GLD, which tracks the actual price of gold.  We also find large volume in the GDX, which is the gold miner's ETF. Options volume is very high in both of these names. It seems that there would be great opportunities to trade these symbols and their options. We haven't found it to be profitable - and we ...

GE rockets higher, 14% profit!

Today, the Fed shocked the market with it's "no taper" announcement. I think they are trapped. The economy is not good enough for them to taper the purchases, but what if these purchases are partly the cause? What if the economy can't get better until they stop the insanity? I think they want to stop the insanity, but now they are trapped into a box of their own creation. To follow up on our GE trade string: Today's large market move has resulted in a large move upward for GE, now trading at 24.83. Yesterday, we did go ahead and sell another Oct 24 call at 65 cents, and then sold another earlier today for 75 cents. The current position is long 500 ...

Building a GE covered call

First, let's update the GE position.Today, our P/L YTD is at $695. Daily Theta (time decay) is $1.35. We have one Oct 24 call for sale at 70 cents, currently priced at 66 cents. I almost always enter my order price at somewhat better than the market and wait for that extra few dollars. Here is the thought process:I own 500 shares of GE and right now I have sold 3 Oct 24 calls against those shares. I want to maximize the daily time decay and I can do that by selling as many calls as possible. GE is up over 1% today so it's a very good day to be selling calls. If you take a look at the GE options, it is clear that there are many choices. GE offers ...