Portfolio Update

It has been a while since I have made so many posts in one week. Last night I decided to put in an OTO trade order for a BAC October 16 2010 $15 put option. The first half was a BTO order at a limit of $1.90 and the second half was a STC order at a stop of $1.43, which is approximately 25% below the limit price. The first half was executed, but because of the good day in the market today and BAC going back up to fill the small gap it produced the day before, I got in at $1.79. Throughout the rest of the day I lost another $0.29, which is not enough to trigger my STC stop order. If the stop is triggered on the penny, I will loose only about 20%. I have been doing so bad on my past few trades I am going to leave that stop in place and wait to see how things fair when the market opens Monday. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

BAC - Bank of America, Corp.
BTO - buy-to-open
OTO - one-triggers-other, where the execution of one submitted order automatically triggers the submission of another.
STC - sell-to-close

Portfolio Update

That didn't take long. Today I reached my target for the October 16 put option I bought against C last week. The move was faster than I expected. I was actually considering pushing out my target and tightening my stop so that I didn't get hit the same way I did with BRCD yesterday. But time wasn't on my side and my $1.17 target got triggered and my position got STC at $1.18 per contract share. The end result was only a 3.95% profit. Nothing in comparison to the 40% plus lost the day before. Is it just me, or is there a different economic data report coming out every day? Anyway, I will be looking into some more option trades. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com/

BRCD - Brocade Communications Sys, Inc.
C - Citigroup, Inc.
STC - sold-to-close

Portfolio Update

This is a late post so I am going to make it quick. On Wednesday I got stopped out of my put option that I BTO on BRCD. I had a stop of $0.98 per contract share, but because of the accelerated rise in the underlying stock my stop didn't get me out until $0.88 per contract share. Since I had two contracts, my total loss on this one ended up being more than 30%. In fact it ended up being just under 41%. I am thinking that I should return back to a 25% loss threshold instead. It might cause me to be stopped out early, but at least I will reduce my losses be trade. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com/

BTO - bought-to-open
BRCD - Brocade Communications Sys Inc.

Portfolio Update and Option Picks

As was expected, I was assigned over the weekend for the September 17, 2010 $18 strike call option I sold against the shares I held in the SLV. As of Monday they have been transferred out of my account and $1800 (less commission) has been transferred into my account. The assignment only gave me a little over 5% profit, but I should also take into account the $70 earned through the collection of premiums over the past six months. So that actually brings me closer to 9%. Can we say, "better than bank interest"?

With the assignment proceeds available in my account, I have the capital to cover the purchase of 200 shares of CPLP at $7.50. So with that said, I set a trade order this morning to STO two of the December 18 2010 put options on CPLP. This order triggered at $0.30 a contract share. After commission, I pocketed $53.74. Now, if my analysis is correct, CPLP should go up towards $9-$10 in the next month or so. At which time I could buy it back for a few dollars. However, if it does go down below the $7.50 strike, I am more than willing to accept the purchase of 200 shares of CPLP. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

From this point I will define the stock symbols and acronyms I use at the end of my post.
CPLP - Capital Product Partners, LP
SLV - iShares Silver Trust ETF
STO - sell-to-open

Portfolio Update

It is one day until option expiration, and the call option I sold against my position on the iShares Silver Trust ETF (SLV) is so in-the-money (ITM) that I would be fall out of my seat shocked if I didn't get assigned. Anyway, I will also be profitable on that position because of the premiums collected against it and the capital gains from the sale at $18 once it is assigned.

Well I finally did it. I sold for a huge loss the 5 call contracts I had for the $4 strike price on Citigroup Inc (C). Although the expiration is not until December, I could no longer deny that it was a loser of a pick. I might be wrong for getting out now, but I was definitely wrong for not getting out sooner. My total loss is about 66%. So goes a lesson in the school of hard knocks. I will not make that mistake again.

In replacement of that loser position, I have decided to take on two put positions. The first is on Brocade Communications Sys Inc. (BRCD). I purchased 2 of the October $7 puts for $1.40 each. When I purchased the contracts I had a one-triggers-other (OTO) trade order set up so that there would be a day only stop of $0.98. The price was chosen so that I don't run the risk of losing much more than 30% of my positions value in the event that I am wrong. I will now be setting up a one-cancels-other (OCO) trade order so that I get out once my target is reached while maintaining a stop so that I don't end up "hoping" for a turn around.

The second position I took today was a purchase of 3 of the October $5 puts against C for $1.09 each. This was also purchased with a OTO trade order that set a day only stop of $0.76. This price was also chosen so that I don't run the risk of losing much more than 30% of my positions value in the event that I am wrong. I will now also be setting up a OCO trade order so that I get out once my target is reached while maintaining a stop so that I don't end up "hoping" for a turn around.

The point I am making is that I am going to follow a plan so that I am not planning to fail. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

Portfolio Update: Trades Executed

It wasn't more than two days ago since my last post so I will just get into the state of my portfolio. Today I had two STC (Sell-To-Close) orders execute for me. The first I am going to mention is the $7.50 put option I bought against Capital Product Partners, LP (CPLP). Since I was wrong about CPLP going down to $7.50 and my concern that it would dance around $8 was confirmed, I slowly but eventually accepted the wise decision was to pail out since the highest probability was that my position would be eroded by time decay. As a result I accepted the 48% lose.

The second STC trade that executed were the 3 $2 call options I bought in hesitation against Citigroup, Inc (C). The thing is that the result was about a 9% gain in just two days. I have to say, I am quite pleased it reacted so well. Now if only C would cross above the $4 mark. I could then start to see improvement in the 5 $4 call options I bought against it in late May. I am not really expecting it to climb above $0.36 a contract share, but I currently have an order in for $0.45. That will return to me a large chunk of my original investment and make the bitter taste of a bad trade into the more palatable flavor of a learning experience. We will see what the future brings. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com