The Money Tree

Safely Generating Income in Retirement

What Others are Trading – March 2010

Posted by mounddweller on March 3, 2010

All,

Here’s a new message string where y’all can post your trading activity.  Thanks Rich for making the most of this opportunity.  Would love to see others getting involved.  If nothing else, comment on Rich’s trades!

Troy

 

 

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22 Responses to “What Others are Trading – March 2010”

  1. Rich said

    I have the following contracts with March expirations ( they are spaced over three accounts ):

    1 PFE Mar 20 covered call
    3 UYG Mar 5 covered calls
    3 URE Mar 6 covered calls
    1 SPWRA Mar 20 covered call – this stock keeps rotating in and out of the money, covered call premiums are decent
    1 T Mar 24 cash secured put
    1 AA Mar 13 cash secured put
    1 KFT Mar 26 cash secured put
    2 URE Mar 5 cash seecured puts

    A good March would have all my covered calls expire ITM and the puts expire OTM, pocket the cash and look for April, May & June opportunities.

    • Rich said

      I had 300 shares of URE assigned today. URE closed yesterday @ 7.64 Here is a summary:

      I bought 300 shares of URE on 11/30/09 for $1705
      I immediatly sold to open 3 URE Mar 6 contracts for a credit of $154.24
      as a result of the assignment I received $1783 cash to my account

      my net gain on this trade was $232.24 which amounts to a return of 13.6% for about three and a half months

  2. Irene said

    Paragon Shipping PRGN
    Bought 3000 shares dec 21-09 @4.65 = 13,959.95
    sold 30 cov calls feb 5.00 @ .20 jan 4-10 = 560.05
    feb expired
    sold march 5.00 (30) calls @ .05 mar 1st =110.05
    Price jumped a lot today, closed at 4.925
    If called in March Profit $1697 including all commissions
    ………..

    • mounddweller said

      Irene,

      How did you find PRGN? VISIONS doesn’t like it much, but then again VISIONS doesn’t like much of anything these days. Way too many stocks trading at 52-wk highs and very few at 52-wk lows.

      Regardless, PRGN appears to have worked out well for you. If called at MAR expiration you will have made 12.2% ROIC in 3 months. That’s darn good.

      BTW, glad to have you sharing your trades on my blog. Keep them coming.

      Regards,
      Troy

    • Irene said

      Paragon Shipping PRGN
      Bought 3000 shares dec 21-09 @4.65 = 13,959.95
      sold 30 cov calls feb 5.00 @ .20 jan 4-10 = 560.05
      feb expired
      sold march 5.00 (30) calls @ .05 mar 1st =110.05
      march expired
      Added 1200 shares PRGN march 9 at 4.87 $5853.86
      Sold 12 calls Sept 5.00 at .50 march 9 $578.05
      Bidding to sell 30 may 5.00 calls at .15 possibly gain 410.05

      DRYS
      5 drys march 6.00 calls expired
      sold 5 may 6.00 calls @ .35 +160.05
      cost per share if called is 5.27 so far ( paid 7.26 per share oct 13-09)

  3. Rich said

    Irene,

    Looks lile you have a winner with PRGN. Have you noticed the activity in DRYS lately? Yesterday its volume shot up over 300%. Heard thru the rumer mill that they may be looking for someone to buy them out. They are a Greek company and that country is not doing too good so far. On top of that they are a single hull carrier. I think the focus going forward is on double hull carriers, at least thats what I heard on Cramer awhile back.

  4. Irene said

    Added 1200 shares PRGN today at 4.87 $5853.86
    Sold 12 calls Sept 5.00 at .50 $578.05
    Net cost 5275.81

    downside break even at 4.397 per share

    I still have 500 shares drys and I am short 5 march 6.00 calls
    drys was 6.04 a few minutes ago…..

  5. Rich said

    INTC scorecard update:

    I purchased 100 shares of INTC on Jan 4 for $20.83 per share and immediatly sold 1 Jul 21 covered call for 1.50

    I receive a dividend of $15.75 on March 1

    Today I sold an Apr 19 cash secured put for .21

    my gain to date is 8.17% and my net cost per share is now down to $19.13

    I would like to build a reverse ladder on this position and see how far down I can get the net cost per share. After March expire I will take a look at the May 18 put strike to add a rung on the ladder.

    Rich

    • mounddweller said

      Rich,

      Like your INTC NP trade. You’ve got almost 10% downside protection and are still earning just over 1% ROIC over the next 6 weeks. You won’t find any money market accounts or CDs giving you that kind of return on your money.

      One percent per month is what I’m hoping to earn with my new NP trading strategy. The hardest part for me will be waiting for my selected stocks to come down in price and into my trading range.

      Regards,
      Troy

  6. Irene said

    I’m never sure the proper way to figure out the percentage.
    If I buy RIM at 73.55 and ignoring commissions. 7355 for 100 shares
    sell one option September 65 call for 13.10 1310 My cost on day one is 6045
    If it is assigned for 6500, I make 455 on an investment of 6045 in 6.5 months.
    455/6045 /6.5 x 12 months = 13.9% annually. Is this a proper way to figure out profit?
    …………………
    Rich, Cramer says Intel is sustainable. http://www.cnbc.com/id/15840232?play=1&video=1436281940
    He also says to buy C when the gov’t starts selling it and the price tanks (same video)

    • mounddweller said

      Irene,

      I calculated your annualized return at 11.6%. Here’s how I got that answer:

      (73.55-13.10) = 60.45

      (65-60.45) = 4.55

      (4.55 / 73.55) = 6.186%

      6.186 x (365 / 195) = 11.6%

      Note: 195 is a rough approximation for the number of days between now and your September expiration.

      Regards,
      Troy

  7. Irene said


    http://seekingalpha.com/article/173986-shipping-three-high-risk-high-reward-options

    http://www.stockgumshoe.com/2009/12/little-known-4-greek-shipper-to-double-your-money-nancy-zambell.html

    Cramer liked PRGN at $20
    http://www.cnbc.com/id/15840232?video=747331261&play=1 so I thought below 5 was a bargain and selling an option was a bit more downside protection

    That’s all I can remember, I will have to start taking better notes.
    Irene

  8. Rich said

    I originally sold ( 12/3/09 )to open 2 URE Mar 5 put contracts for a net credit of $60.50 or a 5.94% return on $1017 at risk

    Today the ask price for those contracts was 2 cents so I bought to close those contracts for a net debit of $6.50

    On the same order I sold to open 2 Apr 7 put contracts for a net credit of $42.50

    The total premium received after this transaction is $96.50 and I now have a return of 6.8% with $1417 at risk

    In summary, $400 additional capitol at risk with an additional 1% return ( ROIC )

    If the contracts are put to me in April I will sell covered calls against the shares until assigned

  9. Irene said

    Looks like another bullish signal ( found on the net) Check out the history
    Irene

    Why Extremely Lopsided Volume Days Are Bullish

    ………..On Friday March 5th, using my unsanitized NYSE data, we experienced a 13 to 1 “Up to Down Volume Day”. We had also experienced a 10 to 1 day on February 16th. I scanned my database back to 1970 for all occasions where two such days had occurred within 21 (approximately one month) trading days of each other. All days where there were more than two such days were considered repeats. Also in my version, to squeeze out the really juicy returns, there could not be a nine to one “down” day in the last 21 trading days. I found nine instances.

    http://www.tradersnarrative.com/why-extremely-lopsided-volume-days-are-bullish-3768.html

  10. Rich said

    I own 200 shares of T at a cost basis of $26.09 per share

    Todays action:

    sold to open 2 April 26 covered call contracts for .33 (net credit of $56.50)

    bought to close 1 Mar 24 cash secured put @ .02 and sold to open 1 Jul 24 cash secured put @ .68 for a net credit of $56.50

    The above transactions enabled me to pick $113 off my Money Tree My net cost per share is now $25.43

  11. Rich said

    My Mar 13 put on AA and my Mar 26 put on KFT expired OTM. Today I sold 2 May 13 AA puts @ .42 net $74.50 Since mid Dec I have picked $474 off of my AA money tree. I still do not own any shares of AA. Years ago my mom would say, “son, we do not have a money tree in the back yard”. Well I have one now and I intend to cultivate and harvest this one for a long time!

  12. Rich said

    My Mar 20 covered call on SPWRA expired OTM on friday. Today I sold the Apr 20 call for .35 This stock has really been on a ride lately. It has been as high as 26 back in Jan and is now down just above 18. At this point I don’t intend to sell any more puts until the stock is called away from me. For now I have a two month gain of 8.69%.

    • Rich said

      Update on SPWRA

      My Apr 20 covered call expired OTM. This stock was as high as 22 in mid March and closed friday at 18.29

      Today I sold the May 20 call for .50 and also sold a May 17 cash secured put for .50 My three month gain on this scorecard is 13.18%

      the stock closed today at 18.91. There are still some good premiums associated with this stock.

      As noted above I said that I would not sell another put until my shares were called away but early last week ProShares repriced a lot of there ultra ETFs and I wound up getting a 5 to 1 reverse split on my 200 URE shares. the price was adjusted from about $9 up to $40 something. This price is too steep for my small margin account. I will post an update on my URE scorecard when I locate that thread

      Rich

  13. Rich said

    AA has been on a slow but steady up trend since the end of January. It is currently trading at about 14.45 and I’m not sure if it will get above 15 by the end of April expire so today I BTC my Apr 15 put and rolled it forward to a May 15 put. This only gives me a net cash credit of $14.50 but more importantly it gives AA more time to grow and my goal is to pick money off of this money tree and not own any shares of AA if possible.

  14. Rich said

    Late entry for March 26 trade:

    I sold one AA Oct 13 cash secured put @ 1.06 for a net of 97.75 I’m continuing to pick premiums off of my AA money tree. AA has been pulling back the last three sessions. I may take a look at selling the Jan 12.50 put if the stock continues to drop somemore tomorrow. Since Dec 21 I have realized a gain of about 5.7% in my IRA just from AA cash secured puts alone.

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