Popular My Trader's Journal Articles:


How to Read an Options Table -- Determining an Exit Price for a Stock -- Understanding Downside Risks in Investing -- How Naked Put Selling Works -- 10 Tips for Keeping Emotions out of Investing

August 18, 2017

Options Expiration – August 2018

Filed under: Account Summary,Finance,Stock Picks - 18 Aug 2017

My four QQQ August $133 naked puts were the only August option contracts I had remaining by today’s expiration. They’ll expire worthless and I’ll have a realized gain of $805.54, but that doesn’t include the loss I took on the long puts I bought as part of the original QQQ ratio spread. The long puts that I closed a few weeks ago gave me a realized loss of $704.51, so my net gain is $101.03.

$101 is hardly worth bragging about, but I’m happy with it considering the ratio spread that I sold in early May was expecting a drop in the QQQ price. Instead, it went from $138.26 on May 9 to $141.61 while I write this in the late afternoon on expiration Friday. I’m happy any time I’m wrong about a stock’s direction and still make money and that’s why I invest with options. Options give me a margin of error that isn’t available with basic buy and hold stock buying or even straightforward stock trading.

After canceling the limit order I had in place earlier this week for a WMT October $80 naked put, I’m trying to decide if I should redo it. I could get …

August 16, 2017

Sold QQQ and AAPL Naked Puts

Filed under: Finance,Stock Picks - 16 Aug 2017

I’ve regretted not being invested in AAPL with every dollar it pushed higher for the past few months, but I stayed out with the expectation that it’d have a pull back offering a better opportunity. After missing the June and July mini-dips, I decided the stock was worth some risk because I expect any new dip, or even correction, to be short-lived. Finally, I made another trade on an Apple option to give me some exposure today. While AAPL was trading at $160.56, I sold one AAPL October $160 naked put for $5.50 and received $549.31 after paying $0.69 in commission.

The Apple trade worked in a funny way for me today because I entered the order when this October $160 put had a bid/ask of around $4.70-4.80. I entered my order for $5.20, but apparently forgot to hit the Transmit button. I moved on and entered a limit order for a QQQ option too and remembered to hit Transmit on it. A couple of hours later, after being away from my desk for a while, I saw the QQQ order hit. While QQQ was trading at $144.24, I sold one QQQ October $142 naked put for $2.80 and received $279.32 …

August 14, 2017

Closed DIS and WMT Naked Puts

Filed under: Finance,Stock Picks - 14 Aug 2017

I closed two short puts today to free up some cash for what I hope to find in a better opportunity. I began with my DIS put that I reference in my YouTube video at the end of last week. While DIS was trading at $102.65, I bought to close one DIS August $105 naked put for $2.55 and paid $255.67 including $0.67 in commission. This trade gave me a realized gain of $3.65 (yes, the decimal is in the right place) while DIS fell more than $3.50 from where it was when I opened the trade.

A few hours later, I moved my focus to WMT. While WMT was trading at $80.73, I bought to close my WMT August $75 naked put for $0.12 and paid $13.09 including $1.09 in commission. I could’ve let this option expire this week and saved the $13, but opted to remove the risk completely. Closing the WMT option earned a $211.23 realized gain for me. I’ll probably sell another WMT naked put, but want to see how the stock behaves over the next day or two before jumping back in at a higher strike.

You can find my trade …

August 1, 2017

End of the Month Summary – July 2017

Filed under: Finance - 01 Aug 2017

I had a decent month in July, but continue to trail the major indexes. The Dow gained 2.54% and the S&P 500 gained 1.93%. Technically, I’m over-invested now, but a few of my positions are far enough out of the money that I’m not getting much gain for the exposure. The summer is almost over, my divorce is final, and my son will be back in school soon. I should be able to refocus and finish the year strong as long as the markets behave.

My account ended July with a Net Asset Value (NAV) of $102,994.78 according to Interactive Brokers (IB) after finishing June with an NAV of $101,776.61. (IB used to list Net Liquidation Values that did not include accrued interest and dividends, but stopped in June.) I had a gain of $1,218.17 (~1.2%) on paper for July and had $251.76 in realized gains from my closing trades on my TLT vertical spread, IWM and ADI naked puts, and QQQ long puts. I received $41.85 in interest, but no dividends in July since I’m not long shares of anything yet. Quicken reported that I have an account value of $102,943.63, which is the same as what IB says I have after adding in the $51.15 in accrued interest that IB is …

July 25, 2017

Closed Half of QQQ Ratio Spread

Filed under: Finance,Stock Picks - 25 Jul 2017

Since I no longer think QQQ is going to drop much, if any, I decided to close my long puts on QQQ and keep the short puts. I’m exposing myself to a lot more risk by leaving the puts that I sold uncovered or matched with long puts, but don’t expect a selloff to take QQQ below my short strike of $133 before the August expiration. While QQQ was trading at $144.48, I sold to close my two QQQ August $139 puts for $0.45 each and received $87.71 after paying $2.29 in commission.

My plan with these puts was to make a profit if QQQ fell, but decided to get out while I still had some value in my long puts. $87.71 isn’t much, but it’s better than just letting it melt away with the calendar. I’m not ready to replace these yet, but will open a new spread before long probably.

Here’s my YouTube video showing my trade along with a brief account review of what else I have working and might need to close soon.

July 21, 2017

Options Expiration – July 2017

Filed under: Finance,Stock Picks - 21 Jul 2017

I came into today with two options left to expire for July. At the open, my order for ADI hit. While ADI was trading at $79.55, I bought to close my one ADI July $80 naked put for $0.39 and sold one ADI September $80 naked put for $3.24 and received $284.30 after paying $0.70 in commission. I brought in $339.75 when I made the trade on the July ADI put and after closing the position for $39.35, I have a realized profit of $300.40.

My other July option was on IWM. While IWM was trading at $142.84, I sold one IWM September $142 naked put for $2.42 and received $241.32 after paying $0.68 in commission. I’m letting the IWM July $138 naked put expire worthless. I earned $440.89 when I sold the July put and will have a full realized gain of $440.89 since I’m not paying anything to close the single put.

For the day, I have a realized gain of $741.29 from the two July options. $741 is good, but not really hitting my target of getting better than a 10% annualized gain for the year. Low volatility is killing my returns on top of my risk averse approach this …

July 14, 2017

Closed August TLT Vertical Call Spread

Filed under: Finance,Stock Charts,Stock Picks - 14 Jul 2017

I closed my TLT August 129/132 vertical call spread for a profit today. While TLT was trading at $123.33, I bought my six short TLT August $129 calls for $0.14 and sold my six long TLT August $132 calls for $0.04. The net spread purchase was for $0.10 and I paid $72.71 including $12.71 in commission for the combination option trade. After selling the spread for $292.68 on June 20, I made a net profit of $219.97 by closing it today.

I plan to sell another TLT spread soon, but would like to have the ETF move a little higher first. I also need to replace my two naked puts expiring next Friday, ADI and IWM.

Check out the trade details here on YouTube. I picked up some new software that allows me to draw on the video screen while I’m talking and it sticks my picture in the video.  I’ll mess around with the software in the coming weeks and decide if I want to keep it showing me. For now, I know I need to shrink the picture of me and blink less. Amateur at work!

July 8, 2017

SPY Chart – July 7, 2017

Filed under: Finance,Indices,Stock Charts - 08 Jul 2017

The chart below shows the daily prices for the past three months on SPY, the SPDR ETF that tracks the S&P 500 Index, after closing the week at $242.11, on July 7, 2017.

SPY retreated 2.0% from its intraday high of $245.01 set on June 9 before having a slight recovery and then dropping again. Even while setting a new high on June 9, the large-cap ETF started showing signs of weakness as it dipped below its 10-day moving average for the first time in weeks. Since then, it has had only one day when it has not crossed below the 10-day moving average intraday. On June 16, SPY traded below its 20-day moving average and has had one day since then without crossing below it. Weakness continued as the bearish crossover of the 10-day moving average fell below the 20-day moving average on June 27. SPY took two more days of trading before it fell below its 50-day moving average for the first time in a month and a half. Large-cap stocks rallied …

July 3, 2017

End of the Month Summary – June 2017

Filed under: Account Summary,Finance,Indices - 03 Jul 2017

I eked out another small gain this past month. June wasn’t a stellar month for the S&P 500, but it gained 0.48%, which is good after the gains of the first five months. I finally got closer to being fully invested and have some decent gains I could make by the end of July and August. That potential could be spoiled by ADI or could be improved upon by my QQQ ratio spread. At least I’m fully engaged again and have a chance to pull out a reasonably good second half for 2017.

My account ended June with a Net Asset Value (NAV) of $101,776.61 according to Interactive Brokers (IB) after finishing May with an NAV of $101,367.61. (IB used to list Net Liquidation Values that did not include accrued interest and dividends, but stopped in June.) I had a gain of $409.00 (~0.4%) on paper for June and had $558.84 in realized gains from my three closing trades (two for a profit and one hedge for a loss). I received $32.11 in interest, but no dividends in June since I’m not long shares of anything yet. Quicken reported that I have an account value of $101,36.22, which is the same as what IB says I have after adding in the $40.39 …

« Previous PageNext Page »

Investing Blogs - Blog Catalog Blog Directory