I'm spent

Yes, I am spent. I've made some gains recently on puts and took some losses on some calls. However, on the way down this last time I kept buying all the way down... and let's just say I am WAY OVEREXTENDED. The losses are mounting up and I really played this one stupid. I am hoping I will be able to get out of these even or at a reasonable loss. But with my bills coming due I may have outdone myself this time. I am contemplating taking out of HELOC to cover the bills because I really screwed up. I figure if maybe I admit it here the market may turn around? Yeah right, most likely not.

Time to Trim

Violent swings and market uncertainty do make one thing for certain. It is completely necessary to trim the portfolio. Below are my options in my portfolio with my actions with explanations that I wish to execute by days end.

5 APVAT (AAPL JAN 200 trading at .23, bought for 1.50) - Incurring big losses here, I bought after RIMM's earnings and then the market as a whole came down. I just feel AAPL has too much cash on their books, which is why I bought this. No sells on this, but my inaction in cutting losses earlier has killed me with this investment.

3 FCXAL (FCX Jan 60 Call...trading at 4.00, bought for 2.65) - Selling 2 of these today, looking for a little higher gain. I may sell all three today, but I bought because FCX was oversold and I was looking for a slight bounce.

6 HPQAJ (HPQ Jan 50 Call...trading at 1.00, bought 3 for 1.10 and 3 for 1.70) - If the option gets to 1.40 I'm selling 3 of these. It's important to have cash on hand in this type of environment.

5 MSAF (MS Jan 30 Call...trading at 2.00, bought 2 for 2.20 and 3 for 1.30) - Hesitant to sell this as a rate cut would send this stock soaring at open. However, short selling ban ends tomorrow and this should weigh somewhat on the market. Looking to sell 3 of these today...2.00 would be sufficient.

20 NCCAU (NCC Jan 7.50...trading at .20, bought for .25) - Bought these in hopes of a quick pop after the bailout passage...this didn't happen, but I'm not worried about this trade. There is much time for this to work and coordinated rate cuts could cause a pop in this. Looking to sell half at .40 or so.

10 AUYAC (AUY JAN 15.0...trading at .40, bought at .60 and .85) - Keeping this as a hedge against the market. If the market goes downward people will buy gold, driving up its price, helping gold companies.

5 YUMAG (YUM JAN 35.0 Call...trading at 1.25, bought for 1.40) - Come out with earnings today and I believe YUM has been oversold, especially with its growth in emerging markets. We will have to see if earnings take a hit.

10 UFBBJ (FWLT FEB 50.0 Call...trading at 1.25, bought 2 for 7.50, 1 for 5.80, 2 for 1.90 and 5 for .80) - Yeah, so this took a hit in the big selloff. I had a chance to sell when it got back up to 45 but the most recent selloff put shares of FWLT down to 28.00. This is absolutely ridiculous, but it's the environment we are in. I hope to sell half of these around 1.90 or so.

I'm overexposed on Calls, I know. I'm looking for good puts to buy, and am zoning in on IBM, CVX, BA and XOM. These stocks are not down nearly as far as they could be.

sold my put positions

We're shaping up for a nice bear market rally tomorrow. I have sold my POT puts for a nice gain of roughly 700 dollars. I also sold my XOM puts, which would have been going for much more later in the day but I sold them for about $100 dollar loss. At this point in the game, I used my raised capital to buy in some down positions, essentially lowering my cost per contract. I bought 5 more FWLT calls for FEB, bought 3 more HPQ calls for JAN and 3 MS calls for JAN. With these I am looking to sell at a breakeven price or slightly higher. I also purchased 5 YUM JAN 09 with SP 35 ahead of earnings tomorrow.

The hard part of investing in this environment is gauging future earnings of these companies. With a faltering domestic economy and a declining global economy, earnings growth projections are most likely to be wrong if estimated today. That means when purchasing a security you have to take this into account...but how much should you devalue the security? I'm not sure of a pricing strategy in this type of environment, which make purchasing puts an easier and somewhat safer investment for the moment.

Regardless, I plan to a portion of these calls tomorrow as cash is king in this type of environment.

Bear market is now.

On friday, I sold my calls in POT and changed to puts. I had bought the calls in preparation for a bounce with the passage of the bailout in the house. I had gotten the bounce prior to the passage, but hadn't sold. I sold them for a very, very slight gain and immediately bought puts. You see, I just have a hunch that they are going to go down like everything else. To me, The AG sector in particular the fertilizer stocks seem overvalued. The stock prices for these (MON, BG, AGU, MOS and POT, to name a few) rely on high growth to accelerate their stock. With a P/E of around 20.8 now (before it was much, much higher), POT needs at least 20% growth to be trading at current prices. With the market unsure of the economy it begins to become hard to predict growth. Although I believe that this sector in general is in an uptrend the nearterm remains very shaky. These puts, which are JAN 09 45, will be held to protect me against drops in the market, where high growth highly valued stocks should sell off first.

banking on a bailout

Monday was definitely horrendous for me. As I had posted in the morning, I lost 1k with the WB calls. I was unable to sell the C calls for a gain and took a loss when the market took a nosedive.

Effectively, I would have had +8k if I had not sold on friday. Instead I ended up losing 1.3k. I liquidated almost everything that day...sold my GS call, sold my HPQ calls, sold nearly everything and bought RF puts and XOM puts. Retarded...anyways things are getting better. After not making the money with C on monday, I rebought on Tuesday and sold half of them. I sold another 3 today, putting me up 750 on the investment.

I still have 2 C OCT 20 calls, and bought more financials as this bailout decisioin looms. I bought 20 NCC JAN 7.5 calls on bailout hopes and takeover rumors, 2 MS JAN 30 calls and rebought 3 HPQ JAN 50 calls. If this thing gets passed NCC should look good and I expect regional banks to merge and create super regionals...we need someone to take WB spot.

That's all for now, all we can do is pull and pray...haha!

Sweet Idea friday.

Friday was a sweet idea day as I dropped all my puts which rose significantly in value over the weekend into today and decided to buy january wachovia calls.

Had I done nothing I would have gained 1200 today.

Instead I am negative 1000. Sweet swing.

I bought C OCT 20 Calls at open for 1.60 to try to make back some of the money. Citigroup now has a superbank.

Oil yesterday

I had to correct my thinking from yesterday. Although long term I remain bullish on oil and its increasing price, I have to say oil increased so much yesterday due to expiration of oil options and short covering in them. that drove prices up nearly $15. Today we are back where we were yesterday and declining. Unfortunately, I got freaked yesterday and sold half of my puts. I lost roughly $60 bucks on them...big whoop but if I had held on for today I'd be well in the plus. I luckily have 10 puts left.

I used my remaining money to open 2 new postions. I am a long term believer in gold as well, as I believe gold will be a hedge against a falling market or the amount of money being injected into the system will result in inflation. Both are wins for gold. I also opened up a position in Apple and GS. I bought a 200 Jan 10 Call for GS and five 200 Jan 09 calls for AAPL. I think GS is well positioned and has solid income and growth. Apple has $23 per share of cash on hand, roughly 20 billion!! I believe, although this is contrary to what Jobs usually does, that Apple will use some of this money to buy back stock. At current levels I see Apple as a buy, and if it declines further I plan to purchase 5 more calls. I just feel at these levels Apple and Goldman are both attractive.

weakening dollar = strengthening oil

The 700 billion 'bailout' plan, although it is necessary, is causing our dollar to lose value. This a common sense cause....injecting more money into our system is going to cause current money to be worth less. This in turn causes oil to be worth more...so why did I buy more puts of BP this morning? I'm not quite sure really. I was thinking oil was going to continue the downslide but it BP has crossed its 20 day moving average and is approaching its 50 day moving average at around 57. Any weakness in the next few days and I'm going to scale out of this position for a loss. I also read an interesting article today on CNN Money interviewing Matt Simmons and his prediction of $500 oil. He has conducted rigorous research and determined that the oil reserves in Saudi Arabia have been inaccurately accounted for. He states that we are finding less oil and the demand will increase, and actually predicted $100 oil a few years ago. Anyways, interesting article, definitely check it out. He even mentions offshort wind turbines, which I had never thought about but seem to be a great idea.

Although i have these puts in BP, I do have 2 calls for CHK and 5 calls for FWLT. These should ease my loss as they increase with commodity prices as well. I'm debating on whether to begin adding to my commodities position again....

I did buy one other call today. A LEAPS call for GS. Cramer talked about how MS and GS are already valued at a lower multiple than bank stocks, and with GS essentially becoming a bank should make them worth more than other bank stocks. Anyways, I bought a JAN 10 200 call as I think GS is now vastly undervalued. Instead of buying multiple calls, I will scale in on declines.

The discipline in me

I have to be proud of the fact that I have shown discipline the past 2 weeks of trading options and it has paid off. I have been willing to take losses in order to minimize getting killed. But I have also made money. If I had been reckless, although I would have been right, I would have made roughly an additional 7k to what I have been able to put back on the board this week. I've made roughly 5k since my July 21st low, and that is something to be reckoned with.

Today, I came out roughly 1.6k up (including my options which expired worthless...nearly a loss of 1.1k). Needless to say I'm back in the game and if I continue to chop away at my loss amounts I may not have to claim any on taxes! It would be nice to get that back and buy some stuff for my house that my wifey has been pestering me about.

I did open an order to purchase BP OCT 50 Puts. I have on order 10 contracts at .85. I feel oil is still in a bear market eventhough Ike's damage has been done. We'll see how it turns out. I guess we can attribute these gains to gov intervention!

More VIX and more options

Well, looks like I was right...although a government intervention is the main reason for this recent takeoff. The VIX opened lower yesterday and then went all the way to 42. When news on the governments "good bank/bad bank" came out it came crashing down and ended lower...although still above 30.

I on the other hand had set some sells in well above market prices. Although I feel negative about one of my sells I know it was the right thing to do. I HAD to take something off the table as too many times before I have seen these gains wiped right off the table.

I sold the following:

WBAD (WB JAN 20) for 1.50, bought for .75. I really feel like I should have just scaled out of this...but at the time I set the sell and left to talk to my boss, I didn't know about the govs plan! I left my desk and noticed the market trading around even maybe 30 pts up...I come back and its 400 up! Perhaps selling 5 would have been the way to go as these don't expire until January.

CYJJ (CY OCT 28) I sold 20 of these as I had 40. I had initally bought these for 1.05, and was worried about the possibility of it tanking as it seemed to be moving most of the day away from SPWR move. Note that CY is spinning off their SPWR shares to shareholders, so no longer will we be able to tie the two together at months end. Anyways, I set the sell for .90...so I lost maybe 340. But it just didn't look like it had any legs. I went ahead and bought 20 more for .50 when it was down, so I still have those to drop off. That should be a pretty gain.

Luckily for me, I'll mostly be unwinding my remaining assets (20 CY calls, 5 HPQ calls and 5 FWLT calls). I have 12 month financings due so I may be able to retain 4k, but recently I've been playing with about 7k.

I also still have my AIG cov call I initiated this week... I bought AIG on tuesday (5.06) and sold a SEPT 5 cov call for 1.75!!! This means my break even point is 3.20. Since AIG can't go bankrupt and it's definitely not going to be going up anytime soon, if it doesn't get called away today I'm going to initiate another covered call for OCT on it. My only problem is it is in my Joint account, which I use for daytrading in between bills.

VIX and options again

Get ready for a good close today. The VIX is spiking and receding off its highs as the market looks for direction. Within the next few days will be a good time to buy, especially for seekers of long term capital gains. I have jumped back into options again, and am mostly day trading as I fear keeping positions overnight.

I'm trading on margin with a few options in hand. As of close yesterday I had the following options.

40 CY OCT 28 CALL...I'll probably minimize my exposure to this although I think the spinning off of the SPWR shares will be a catalyst going forward. I'm overexposed and actually bought 20 more when they were at .50. Breakeven for me is .80, and may completely wipe this position by days end.

5 HPQ JAN 50 CALL... These exploded yesterday with the announcement of job cuts. HPQ was cutting jobs due to the EDS merger. I could have sold yesterday for a double but missed my opportunity. These are still currently trading higher than the 1.50 I bought them for.

As of 1200, I went onto margin with the following trades....

10 BP OCT 55 calls... I bought these before the market tanked today, looking to capitalize on what I thought a flight to safety...oil. Oil and Gas ops have to settle down sometime as the decline from oil is reaching steady support. I bought these fairly high at .95 and they are trading slightly down.

10 WB JAN 20 calls... I've had my eyes on these for awhile, and when I saw WB under $9 a share I bought these for .75. Currently these are fetching .90, but I can't sell today due to the day trader rules. I have to wait until tomorrow to close this position.


My ROTH IRA is reeling right now. I have $600 of contributing left to do, and may do that. I bought GE yesterday at 24.30, and it's still declining. GE pays out it's .32 divy tomorrow and I have 50 shares. Reinvesting should get me half a share or so....but I'm still overly exposed in commodities. However, most of my holdings, nay EMC are paying a divy (I hold VZ, JPM, FCXPRM, AA, DE, AUY and GE as well).

recent wins...

I've been doing quite well lately, but yet so has the market. At last glance I was down big, but have clawed my way back to....down a little. My scottrade account is definitely in bad shape, but my usaa account is not near as bad.

Recently, I have taken losses on some puts i purchased, jpm, cof and amzn...all three were losses. I don't like puts very much, i get too antsy and sell them before t hey have gained value. My calls on the other hand have been doing quite well. I like to buy calls otm that are about 4-7 months from expiry. this way if i buy them before earnings they still have another earnings release before the option expires. some momentum stocks i have bought way otm and just wait for a swing to lock in a 20-30% gain.

I have realized gains from options for the following stocks... BSC, DIS, FWLT, MON GLW and SGP. My only recent loss was on S.

As my USAA account nears even, I will again be taking a huge hit this week as a long option CATBO expires worthless, which i payed 8.00 for the contract. Again I will be looking out of a hole.

Currently I'm working YHOO, MSFT and MO options. I'm working to create a bull call spread on all three. For MO, they are spinning off their international business. They are doing this on March 28, so I figure people will want to get in before this time in order to get these shares, driving mo's share price up. I'm buying 75's and selling 80's.

For MSFT and YHOO, I believe a deal will get done. MSFT options are July 35's, and this will protect me if MSFT walks away because their share price should shoot up. YHOO calls are the MAR 30's as I ultimately feel MSFT will raise their bid. Regardless, I should be protected either way, and I'm selling two sets of calls above these to create a spread.

One new stock I'm looking to buy options on is BA. I had heard and have yet to confirm that their dreamliner is on schedule, and I think BA is cheap in the 80's. I'm looking to buy options in the 4-7 month time frame on any pull back...I'm also looking at TSL options. When I find their report date, I'm considering buying a call and a put at the same strike price (straddle). I'll make money as long as the stock moves further than the sum of the two.

That's all for now...let's keep the ball rolling.

sell sgp, pick up some mister softee

Today I dropped SGP calls, ticker SGPCX in an effort to get liquidity for monday. I then proceeded to buy MSFT JUL 35 calls. I believe MSFT's bid for Yahoo! is a goodie, and MSFT has solid growth and will be able to take on the debt quite nicely. A quick look at the balance sheet offers 21 B in cash / investments with currently no debt. I plan on initiating a spread with the JUL 37.5 calls as MSFT moves up.

I also had MON and CRDN calls in my sell block as they hit they neared their sell points. With little economic data out monday and a slew of earnings I felt keeping these positions throughout the weekend wouldn't hurt.

I'm not sure which calls/puts to pursue as I head into next week. This weekend I will need to research earnings in an effort to gauge new investments. Sectors that I see are good for next week are ag and infastructure, retail and banks. I see commodities and oil decreasing a bit as big money switches sectors. I really like FWLT but my order yesterday did not fill.

Hedging my portfolio and how I dropped the ball

So today I figured, you know what, the FED might not cut...or maybe the market has factored in the whole .50 basis point cut. So I decided to buy puts on JPM and COF. I also had bought puts on AMZN in hopes that they would drop the ball. Anyways, when the cut was announced, I decided to sell the puts because I saw us going to 300 like every other rate cut.

then, everything came tumbling down. A hedge is a hedge, you forget about it and sell whats up...the calls. Selling my calls I would have created good cash and would have money for tomorrow. Instead I sold my puts for a loss and now my calls lost the value they had when the market was up 200 points. I can never figure out the market unless I devote myself mentally and physically, 100% to this.

Long term this should be the right move but I'm not sure about the short term due to volatility.

Let's hope AMZN disappoints like all other techs and my puts gain value.

what to buy today....

I was expecting premarket to be lower...but it looks like rate cuts have a buzz about them. If the market continues in an uptrend until bernake speaks, look to short or open put positions. The market is going ahead expecting stuff again and remember we are still a few hundred points off the bottom. We still have a ways to drop I feel.... Personally, I'm hoping for a rally today and tomorrow and then a drop off. Look to open put positions on largely overvalued companies...such as FSLR, BIDU...etc. The street feels it's not worth paying a P/E when growth is in question.

As for EMC, I got most of it right this time!!!!! Now I wish I would have sold it all, but hey what can you do?? Well, if EMC reports a good number and dazzles investors today...it is a cold cut buy. Period. EMC was way overdone yesterday, down to 14.90 / share. If they have good earnings, and are at this level, I will purchase shares and options of this stock. Be careful to watch VMW, as these are tied regardless of EMC's internal business.

Regardless, opening a position today in a bank stock or retail is my way to go. Rate cuts will get us out and spending, and even a little bit has changed big money's attitude toward these stocks. I will research some 'safe' plays and get back to some posts later today. Good luck.

sold some bsc, emc

BSCGC hit my sell limit. I bought on friday for 1.25 and sold today for 1.70. I also sold 5/7 of my EMC options today before they report. I doubled up and felt taking some of them off the table was the right thing to do. I just feel that in this market, EVERYTHING must go right for a stock to go up. With VMW reporting this evening and EMC tomorrow, VMW would have to beat and up and so would EMC for us to get much more gain out of this. Recently I have been ripped off by not selling when up...not selling AUEFJ when it doubled, not selling EMCBC when it had went up 80%.... I have had several bad calls...although usually doing the opposite of what I actually did turns out being right. Therefore, VMW and EMC will both rise tomorrow along with my option...but at least i have two left, right?

Total realized gains for today were $700. SGP option almost hit this morning but didn't get called away. That would have been a $220 gain. Now I have good cashflow going into tomorrow. If EMC gets hit I'll likely buy some and initiate a covered call. If it goes up I'll sell my remaining two options. Now I have good cash flow and will look to buy on a gap lower tomorrow. Let's hope durable orders are down tomorrow so I can get some good buys...

Today looked like a good day to get into some MCD options....I'll do more research this evening on different option plays...what I own, what I want to own and when I plan to sell. I really need to get more defensive in my options plays and focus on covered calls and mixing in some puts. So long for now...

long time no talk

Yes, I have not been writing on here much because I've been busy losing money. I'm having trouble buying puts at these prices although prices shouldn't be looked at when purchasing a put. I currently am buying calls in groups of 5 or 10. These calls are out of the money calls 5-7 months out. I look to buy and sell within the day or week. I don't want to hold onto my positions for long in this market.

I currently have or own calls on EMC, GLW, SGP, BSC, AAPL, BBY and SIRI.

I'm looking to buy some contracts for some large cap banks, retail, ag or infastructure. I'm focusing on wb, jcg or shld, mon / mos / agu, or sgr / fwlt. These companies have all come down enough where starting a position in them should fare well long term.

I would really like to get out of these positions but feel it's the only way to make up for lost time. hopefully the fed doesn't drop the ball this week and cut lightly, which would resend the markets into panic mode.

House of Pain

Man o man, 08 has been the house of pain for me. I have lost my shorts and then some. The past few days have provided some gains, as I try to recoup from my current, still invested losses. I have had to go to margin...you see, I just felt this market was oversold. A short correction was in need and I think we may have got it today. Up 150, but that's not the best part. My intraday trades have paid off on margin, by the amount of nearly 700 in two days. Mind you that the day before was down 220, so the total market movement for the two days was roughly -70 pts. This money sounds great, only it is offsetting nearly five times the amount in losses.

Seriously, this is no joke. This market is absolutely horrible...and the bad part is I want to do this for a living! That may be a joke.... (not really, I do want this job for a living but the fact that I have had trouble making money for myself is the sad part). I currently don't know how much I am down but regardless, I have a strategy to pull me back from the depths of the abyss that I have fell into.

I plan on trading on margin, small, quick trades that will render $100-200. The plan is to invest no more than 1000-1500, and take the quick 10-20% gain. This requires movement with the market...something which to this point I have not done. USAA does not offer trailing sell stops and I am overinvested into options. Once these trades have negated a loss, I simply take it off the table. I then take that money to a safe investment, and will continue to accrue revenue.

I want this so bad...I really do, I want to accumulate wealth so I can buy stuff for my wife for our house and have a sound, long term investment that I can use towards a lifetime of fun. Long-term prosperity is what I seek, and with continued declines in my portfolio I won't achieve it. THIS IS THE TIME FOR PRESERVATION so I need to quit trying to grow my portfolio and seek shelter...FRAG OUT!!!

I still remain extemely bullish on the following....

tech: EMC, CY, GLW
financial...: GS, NLY
mining: FCX
safety: PG, MO, PEP, KO
healthcare/service: CVS
telco: VZ, T

I also think that Cramer has suggested DOW...what a great dividend play. DD just upped guidance, will DOW follow?? It's at a 52 week low, so maybe it's time to get in...

See, I'd like to suggest other companies, but being an EE I'm only really good at seeing tech.

EMC strong buy at current level...both long and short

EMC represents a low risk high reward ratio at its current levels. Over the past 4 months, EMC has dipped below 18 twice. With these two drops it quickly rebounded to 19+ a share. If it breaks 17.50 the next level of support is around $16.

I have just purchased 4 near term calls (EMCAC, strike price 15) on the dip this morning. I purchased for $3.10 and am looking to offload at 3.60 before FOMC minutes at 2pm. The market should correct itself as it anticipates the minutes. Thus far it has shown resistance at 18.00 mark.

Let's set off 2008 on the right foot.