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

Portfolio Update: Trade Executed, Current Positions, Pending Orders.

It has been 12 days since my last post and this is how things are working out for me. For starters, my iShares Silver Trust ETF (SLV) $18 call option that I sold to open has been climbing and holding in the money. At the current rate, it could break through the next strike price. Fine by me since I want to collect the capital gains on my SLV position. As a quick note, EV Energy Partners (EVEP) did dip below $32.50 but has been climbing up ever since. The current close is $33.62.

In my last post I mentioned a concern that Capital Product Partners, LP (CPLP) could base around $8 for about month before going back up if it didn't continue down, and that my position would be eroded. I am sorry to have to say, it looks like that may very well be the case. I am not quite ready to dive out yet, but I will have to eventually.

And lastly, I think I am making more bad mistakes, but I can't seem to help myself. Citigroup Inc (C) has been ranging between $3.50 and $4.25 for a few months. And for some reason I keep expecting growth out of it based solely on the fact that it is technically oversold both on the daily and weekly charts. It would have been wiser for me to by the stock and sell the $4 calls against it month after month. For that additional bad mistake I started this paragraph of with, today I bought 3 of the December 2010 $2 call options. Woe is me if I don't see a momentary bounce in C for a week or two. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

Portfolio Update: Call Option Sold To Open

It has been a little over a week since my last post. Since then I have made a few adjustments to my stops and desired entries. My reason for posting is that one of them was triggered today. I sold-to-open a September 2010 $18 call option against my shares of the iShares Silver Trust ETF (SLV). The premium for that sale was about $45.40 after commission. That is a nice percentage gain Although it could have been better had I sold it a couple weeks ago instead of trying to sell the August 2010 $19 call option. The other end of this trade is that if I get called on it next month, I will also collect my capital gains on the underlying shares.

The stock EV Energy Partners, LP (EVEP) dived below the secondary trend line I mentioned in the forecast I made in my last post and is currently declining lower at a very slow pace. EVEP closed today at $33.23. I still believe it will continue to decline into the $32.50 to $30 range before turning back up.

The put option I bought-to-open against Capital Product Partners, LP (CPLP) hasn't been moving favorably for me. My current position went into the hole $20 the day after I entered it and it hasn't gone anywhere since then. The CPLP stock hasn't been moving much for the past week. It looks similar to EVEP in that it dived down below one trend line, but it seems to be dancing just above a much shallower secondary trend line that I expected it to break already. The weekly and monthly Stochastic and MACD indicators suggest that it is over-bought and should not be going back up much higher in the immediate future. However, the daily indicators are in the over-sold ranges. This suggests to me that if it doesn't break below this secondary trend line soon, CPLP will be basing at the current $8 level for about a month, eroding my position.

I haven't mentioned this position for some time, and it is about time I did. Maybe I will finally get it through my thick skull to let a looser go. It really does look like I again made a very bad move. Citigroup, Inc stock (C) hasn't been doing bad nor good for the past couple of months since it declined back in May of this year. I fully expected it to turn up a lot more a lot sooner. Unfortunately, instead of buying stock and selling call options against C, I bought 5 calls in expectation of better performance now that it has restructured itself and spinning off Primerica Inc (PRI). Oh well, wishful thinking. I am already more than 60% in the whole. My current forecast of C for the next four months until the expiration of the options is to almost break even at best. I'm so disappointed in myself. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

Portfolio Update

In my last post I had spoke of putting in an order to sell a Call option against my position of the iShares Silver Trust ETF (SLV). That order never got executed because the value of my shares never went high enough to trigger the contingency. That is fine as I am just moving it over to the next months Call option.

Since then, however, I have been manually updating a stop order against my shares of EV Energy Partners, LP (EVEP). Today that stop was triggered and I captured a profit of a little under 32% including cost of commissions and fees. It is m opinion that EVEP will be pulling back between $32.50 and $30 before it . This particular opinion depends on it actually closing below a secondary trend line with an upcoming intersection of $34.52. I have this contingency in my opinion because for this triggered stop I used low of the of the "out of the ordinary" sell off and rebound in the stock back on the 6th of May as the starting point of the trend. In all honesty, I probably shouldn't have as such behavior is an anomaly and the low of May 21st was a lot more reasonable. However, profit is profit.

In addition to this profit taking, I am also taking the opinion that Capital Product Partners, LP (CPLP) is over bought again and will be repeating it's basing behavior. This time I believe it will base down around the $7 dollar range. As a result of my opinion I purchased the CPLP December 2010 $7.50 Put option. I choose this option because the December 2010 $10 Put is too expensive for my current cleared capital, the September 2010 $10 Put is to close in time, and none of the current $10 Call options will give me a satisfactory premium without risking the loss of the stock below my cost basis. I am also setting it up to Sell-To-Close (STC) after the underling stock drops below $7.50 I may be "leaving some money on the table", but I rather not be greedy. After all, there is always another trade to be made. That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com