Monday 3/16

The markets started to go on a little bit of a tear after lunch before ending the day down. The DOW and S&P 500 down 7 and 2 points, respectively. Portfolio was up $2,300 around lunch time before coming down to end at positive $394.70. BAC almost broke $7 which was nice before ending the day at $6.18. The calls I bought last week were up 54% during the day and I was debating selling half or all of my position, but kept them thinking I could maybe pull a 100-300% return instead. So I ended up not selling them and right now they are up just over 4%. Not too bad, hopefully I will sell them within two weeks for a huge gain.

MS decided to drop -9.4% which is good and bad. I don't want to get assigned my call that I sold @ 26 because I went to keep my shares. So anything below $26 this Friday would be ideal. The call dropped -75% which helped put $180 in my pocket. But my MS shares are down $478 today alone. At least I'm still up almost 10%. The call was almost at a delta of 1 which is a good hedge when being short a call. If the stock goes down, the call I sold against it goes down and if it goes up, who cares? I'm still making money.

I just read Warren Buffett's annual report to shareholders. He talks about his derivative contracts that he is short. Just like me, he doesn't have to post additional collateral on most of his shorts. He can then use the premium and purchase other assets to increase his worth just like tampacapital.blogspot.com. Did you ever think me and the big guy would have so much in common?