April Recap

Dow up 151.98

S&P 500 up 17.26

Portfolio up $1,624.88

3 High Days

4/28/10 $595.78

4/20/10 $553.19

4/23/10 $495.03

3 Low Days

4/27/10 $1,184.81

4/30/10 $915.51

4/16/10 $890.77

21 trading days in the month of April with 8 trades completed. Collected $63.62 in dividends and received $0.11 in net interest.

The running total for the year is up only $3,661.13 which means I am off my goal of $30,000 for the year by $6,338.87. I need to make $26,338.87 in the next 8 months or $3,292.36 each month to hit my goal.

I actually thought I was doing pretty good up until the end. I had 17 up days with 4 down days with 3 of them coming in the last week of the month. This compares with 5 down days for the DOW and 6 down days for the S&P 500. I dropped over $2,377.75 in value in the last week on just those three days.

March and Quarter Recap

Quarter Recap Q1 2010

DOW up 428.58

S&P 500 up 54.33

Portfolio up $2,036.25

3 High Days

1/4/10 $897.92

2/16/10 $781.85

2/1/10 $766.37

3 Low Days

2/4/10 -$1,488.93

1/22/10 -$1,018.45

1/12/10 -$605.34

61 trading days in the quarter with 27 trades completed. I received $150.38 in dividends and $.28 in net interest.

Off of my goal by (30,000-2,036.25) $27,963.75. I need to average $3,017.083 a month for the rest of the year to make up the difference. Its not looking good.

March Recap

DOW up 531.37

S&P 500 up 64.94

Portfolio up $1,849.32

10 trades in 23 trading days. I received $69.07 and $.09 in net interest.

INTC Calendar Spread Finally Closed

I finally closed my INTC Calendar spread today for a net credit of $.40.

Here are the details

3/04/2010

BTO 10 INTC Apr 17 '10 $22 Call $.21

STO 10 INTC Mar 20 '10 $22 Call $.03

I bought 10 contracts of the April calls for INTC at the $22 strike price. This transaction gives me the right but not the obligation to purchase INTC anytime before the expiration date of April 17th for $22. This means that I feel INTC will go higher than $22.

To hedge this position, I offset it by selling 10 contracts for the March calls for INTC at the $22 strike price. This transactions gives me the obligation to sell INTC anytime before the expiration date of March 20 for $22. Here I would be betting that INTC stays below $22.

These two transaction put together represent my spread. I believe that INTC is heading higher which is why I bought the April calls but I wanted to make them "cheaper"so I sold the front month calls which are hedged by the April calls. I benefit if my thesis is correct because if INTC goes higher, my April calls will appreciate more than the March calls of which I am short.

I closed this transaction out today.

3/16/2010

BTC 10 INTC Mar 20 '10 $22 Call $.06

STC 10 INTC Apr 20 '10 $22 Call $.46

As you can see, these transactions are just the opposite of the previous opening transactions. Instead of Selling to Open (STO) the March call, I'm Buying to Close (BTC). Same thing for the April call. I Bought to Open (BTO) but now I'm Selling to Close (STC).

You can see that I lost 100% on my short call but it only was a loss of $.03. I gained 119% on my long call or $.25 which turns out to be a net gain of $.40 or $400 for my 10 contracts (before commissions).

In the end with all the commissions counted:

I had an initial cash outlay to open the position of $205.27 and

I closed the position with a cash inflow of $374.73 or a gain $169.46 over 14 calendar days or a gain of 82.55%.

As you can see, if I had just opened the long April contract I would have had a gain of 119%. While this is true, I would not have been positioned to hedge against a downward move in INTC.

INTC rose over the course of trade $1.20 or 5.86%.

Option Spreads pt. 2

Some updates on my spread option trades

BTC 10 C Jun 19 '10 $3 Put @ $.09

STC 10 C Jun 19 '10 $4 Call @ $.12

Closed this trade on 3/8/2010 9:30:07 AM for $25.26 in commissions for both legs

Opened the trade on 1/21/10 which means I held it for about 6 weeks.

Final profit for the trade including commissions was $49.46 after getting paid $44.73 (after commissions) for putting the trade on.

Update on my INTC trade

Opening trade on 3/4/10 with INTC @ $20.45

BTO 10 NQ April 17 '10 $22 Call @$.21

STO 10 NQ March 20 '10 $22 Call @$.05

Where the trade stands now 3/10/10:

INTC @ $21.19

10 NQ April 17 '10 $22 Call @$.40

10 NQ March 20 '10 $22 Call @$.05

Including commissions on the opening trade.. My short March calls are trading at the same price even though the stock is up due to theta decay and my long April call is up $.19 for a profit so far of $144.74 or 70.51%.

If i had just invested in INTC with my initial $205.27 and not used options, I would have a profit of $7.43 or 3.62%.

INTC Calendar Spread

Order Placed 3/4/10 10:16:25 AM

Underlying : INTC (Intel) trading at approximately $20.45

BTO 10 NQ April 17 '10 $22 Call @$.21

STO 10 NQ March 20 '10 $22 Call @.03

This position created a net debit in my account of $.18. Including commissions this position cost $205.26. This position is bullish on INTC.

Not going to lie to you but I immediately regretted placing this trade today. My hunch was right and this trade is amazingly negative already. I'm going to wait it out for a couple of trading days and see if we can't turn this guy around....crap.