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.
Monday, September 29, 2008
Tuesday, September 23, 2008
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.
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.
Monday, September 22, 2008
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.
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.
Friday, September 19, 2008
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!
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.
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.
Wednesday, September 17, 2008
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).
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).
Subscribe to:
Posts (Atom)