selling naked puts and writing covered calls stock options blog
Written on Aug, 21, 2014 by in , | Leave a comment

I’ve been thinking about closing my SPY October $160/180 vertical put spread for more than a week.  SPY recovered nicely from its recent decline and I didn’t feel like it was giving me the protection I wanted.  With the long puts being nearly 10% out-of-the-money, I don’t think I was protecting much.  I don’t expect to see a correction of more …

Continue Reading...
Written on Aug, 15, 2014 by in , | 4 Comments.

Sideways moving markets can be great for option sellers and can be somewhat boring sometimes too.  Option sellers have the advantage of making a profit (or a reduced loss) in a sideways (or slightly down) market if the premiums were traded at the right time and strike.  I haven’t made a trade this month because I wanted to see how …

Continue Reading...
Written on Jul, 22, 2014 by in , | 4 Comments.

When six of my UWM July puts expired (four short, two long) last week, I mentioned my attempt to sell some August $75 naked puts.  The order didn’t hit and I didn’t go after it again during yesterday’s dip.  Maybe I should have because the small cap index gapped higher today.  At the same time, maybe it’s good that I …

Continue Reading...
Written on Jul, 18, 2014 by in , | Comments Off

I’ve been using a steady plan of dumping far out-0f-the-money (OTM) naked puts once they got cheap enough and was planning to stick to that with my July UWM positions.  Instead, UWM moved so much higher so quickly, that I didn’t react when the option prices first dropped and then I figured they were so far OTM that the risk …

Continue Reading...
Written on Jul, 16, 2014 by in , | 3 Comments.

It has been more than a year since I made a trade on Apple (AAPL) and that changed today.  I was excited when AAPL shares split 7-for-1 early last month because I knew I’d be able to get back in with options without putting up $40-50,000.  I didn’t jump on the options last month because I was curious how the …

Continue Reading...
Written on Jul, 15, 2014 by in , | Comments Off

Not quite a month ago, I closed my XLF June $23 naked puts while XLF was trading at $22.83.  It was the right trade to make because XLF retreated to $22.47 as recently as late last week.  However, the Financial Sector ETF rebounded yesterday and had a follow through day today as JP Morgan and Goldman Sachs (two of the ETF’s …

Continue Reading...
Written on Jul, 06, 2014 by in | 1 Comment.

The chart below shows the weekly prices for the past two and a half years on the S&P 500 index ($SPX) after the index closed the week at 1,985.44 on July 3, 2014. The S&P 500 reached an all-time closing high on Thursday to finish a holiday-shortened week on the back of a positive employment report in the morning.  Reaching new …

Continue Reading...