Master Income Update -
Friday, 27 May 2011
Good morning!
I wanted to send this out earlier than normal today for an important reason..
We have a 3 day weekend staring us in the face – and the option premiums will start
flattening premiums at around the mid-point of the day today. So it’s important to make
your rolling moves asap.
Given the market cycle right now, I’m looking to roll and/or adjust weekly income trades
to the closest at-the-money strikes as possible.
For instance, I’ve rolled all my BIDU to next week’s $130 calls. I’m rolling my POT to
next week’s $55 calls. AMZN to next week’s $195 calls, etc.
These are important FYI’s – and here’s to getting the bulk of your income captured here
during the morning trading hours!
–P
Master Income Update -
Thursday, 26 May 2011
Hello!
Here’s what I’m all about so far today with my MIT positions:
I’m overwriting out on BIDU, letting all 70 of this week’s $135 calls expire worthless, and
with BIDU here right at $130, selling 70 of next week’s $130 calls. This both saves a
commission expense, and also the expense of the $.06 cents of buying back 70
contracts. In 24 hours from now – this all goes in your pocket.
On FAS, I’m selling next week’s $26 calls (overwriting, letting this week’s $28 calls
expire).
On NFLX, I’m rolling my 20 $245 calls to next week’s $260 calls.
On NFLX, I’m rolling my 10 $250 calls to next week’s $265 calls.
On POT, I’m doing a partial overwrite, selling 10 of next week’s $55 calls. I have 20 of
this week’s 55 calls. (on 3,000 shares).
On FFIV, I’m overwriting, selling next week’s $110 calls. FFIV is a sleeper right around
now, but can ignite at any moment (doing a little igniting today).
I’m also overwriting on AMZN on half my position..I’m selling next week’s 195 calls and
letting all of my this week calls (the $200′s) expire worthless).
That’s it for right now, –P
Master Income Update -
Tuesday, 24 May 2011
Good morning,
While the market tries sorting itself out (it feels like there’s just too much to digest in
the world at the moment…so the market just kinda goes numb!) – I’ve moved my last
June puts on NFLX up and out from the June 220 puts to the Sept 230 puts.
I like adjusting puts when there’s really not the need (when the stock is going up) vs.
when you NEED to have the puts.
Plus, puts are cheaper when the stock is acting strong, and then there’s the reason that
we don’t want to feel those last 2 months of accelerating time decay.
CRM had an awesome response to it’s earnings/guidance late last week. I decided to
get into this with 500 shares, sell next month’s (no weeklies) $150 calls, and then buy
Aug 130 puts for the protection.
On LVS, I’ve never bought puts on this one to date. But I was looking through the July
puts and couldn’t believe what the July $38 puts were quoted at!? Here these are full
two months away and they’re right underneath the current stock price (stock’s around
$40) – and they’re like $1.31?!
Since I sell weekly puts on LVS most weeks, these will be nice to help offset the margin
requirements on those trades here and there too. Anyway – I’m buying 20 of these
since I own 2,000 shares.
Finally, I also got interested enough this morning in SLV…it has weeklies, and there’s
been institutional buying in the calls. How I’m trading it is with a mini-calendar put
spread (which is bullish), but the same thing could be done by owning SLV shares,
selling weekly calls, and owning -say- 1 or 2 month out of the money puts.
What I’m doing is without stock, I’m buying the June $31 puts, then selling this week’s
(May Week 4) $35 puts. What I anticipate doing is selling weekly at the money puts,
and anticipating that the bigger money knows what’s going one more than little ‘ol me.
And with the way silver bubbled up there and then got taken to out back to the woodshed,
it may be basing right here.
Anyway – hope all this finds you well today! –P
P.S. If you didn’t hear yet, Jeff Augen, the author of 3 different books all about option
expiration (complete with “pinning”, volatility implosion and the rapid time decay, even
down to the minute of the day when it starts happening on expiration Friday), has
confirmed to be my special guest speaker on our next tour stop of the “Overpaid and
Unemployed Tour” taking place in Salt Lake City, UT in that last week of July!!
Can I get a What-What!!?
Of course I’m biased, but coming out to a live 2 days of trading with me, and to get to
meet Jeff and learn from his expertise (not to mention most likely making money together
live as a class, and meeting the coolest freaking people on the planet in the other
attendees) – well — it’s a made to order experience that you can’t afford to pass up!!
We all hate the humiliating strip search and glares as we try to board a flight these days,
but all those headaches and trouble will be weeeellllll worth it my friend. Plus, my staff
will take care of you like family.
If you haven’t yet…you should check out: www.unemployedtour.com. As you’re making
your summer plans, you should keep the end of July open, plan on getting strip searched
and then heading to the mountains of SLC!! What a blast it will be.
It may really and truly change your life and forever change how you think about making
money in the market.
Okay – I gotta run now, over and out, –Pirate
Master Income Update -
Thursday, 19 May 2011
Greetings,
Here’s what’s on tap for today, the movings and adjustings,
etc on this new Thursday (with brand new “May Week 4″ options
on the ready).
I’m selling next-week calls on AMZN on 100% of my position,
that would be the May Week 4 $200 calls. For this week,
I’ve had the $205 calls sold which will no doubt be
expiring worthless tomorrow.
So this is an “over-write” which simply means selling next
week’s calls on top of already having a position for this
week. This over-written condition will exist for several
hours today – and then the trading day tomorrow.
On BIDU, I’m looking at this strength today in BIDU and
selling 30 calls for next week, choosing the May Week 4
$135 calls.
For this week on BIDU, I had sold 30 $135 calls and 40 of
the $140 calls. I figure these 40 $140 calls will be
expiring worthless tomorrow (BIDU trades at $135.70 or so
right now).
Just jumping the gun a little here and getting 30 new ones
sold for next week.
I’m also doing a partial over-write over in NFLX, selling
10 of the next-week $245 calls.
I have a boring/sleeper position in MSFT and I’ve got the
$25 calls sold for this week (which will expire worthless too),
and today I’m selling next-week $25 calls on the entire
position, figuring this week’s will wind down to zero come
manana.
Over in POT, I’m rolling out of 100% of my calls…buying
back the $52.50 calls for this week and selling next week’s
$55 calls.
that’s what’s on tap for today so far. Hope this finds you
well. –P
Master Income Update -
Wednesday, 18 May 2011
Hello!
I’ve done a lot of nothing so far this week as the market’s been extremely bumpy,
volatile and well, crazy.
I’m loving the action I see out there today, especially in the likes of AMZN, BIDU, NFLX,
FFIV and a bunch others.
The market cycle has turned over again – and it’s during times like these where the
action can get down right queezy.
Like I was talking about earlier to a friend today..
It’s as if money decides to leave and go to the sidelines. But once there, the money
(in droves) realizes there’s no other home that’s better for money than in stocks right
now!!
What’s the money going to do…chase more of the gold bubble, or earn sub 1% interest in
interest bearing accounts?! And bonds? Geez, with the threat of inflation around every
turn…turning to bonds is a losing proposition from the start.
Anyway – that’s just a pet theory of mine.
The bottom line is that with MIT style trades – our puts are sitting there, ready to save
the day and kick in if the market really wants to sell-off on us.
With all this volatility too, I’ll betcha we salivate over the premiums that get printed
come tomorrow morning.
As things are – I’m ready to over-write, roll and sell new premiums as they become
available manana.
Hewlett Packard and DELL are some of the last big names to squeeze out earnings for
this latest earnings round/season.
So that’s nice to get them out of the way.
Anyway – I’ve been laying low this week – so that means there will be a lot to do come
Thursday and Friday of this week!
See you then and over and out, –P
Hello,
Karson Keith here jumping in for Preston.
Just wanted to fill you in on NFLX.
We rolled the June 210 Puts out to the September 215 Puts.
That’s all for now, I just wanted to keep you in the loop.
Have a great day.
Master Income Update -
Friday, 6 May 2011
Hello and greetings,
Here is the rundown of what I’m doing with my MIT income positions:
I’m buying back all my NFLX 235 calls for today and selling the $235 calls for my entire
position for next week.
I’m buying back my LVS $47 calls for $.02 and selling next week’s $44 calls. I like how
LVS had a little snapback after their earnings projections came up a tad short.
On NVDA I’m selling next week’s 20 calls and letting this week’s $20 calls expire
worthless. NVDA has earnings next week.
On AMZN, I’m selling half my calls at the 205 calls and half at the 200′s. I am rolling
out of the $195 calls for this week to do this. I like the reaction to AMZN’s numbers
earlier this week – and this one should move over time to the upside with that breakout
and all.
In BIDU I’m position into 20 of the $140 calls and 50 of the $145 calls for next week.
BIDU had a real rollercoaster this past week, it’s put in a high today of $143.51 – so it
looks like it could be taking back some ground that it fell from. By selling most of
my calls at the $145 strike, it lets some of that ground be covered.
I’m selling calls on FAS into next week, selling the $30 calls for 100% of the position.
I’m doing FAS because I’m also doing FAZ at the same time, but the FAZ trade is a weekly
put spread with no stock ownership- which is a fancy way of doing the equivalent of
selling weekly calls while owning the stock.
I’m selling the $55 calls on POT for 100% of my position for next week and letting the
$57.50 calls today expire worthless. Commodities finally got a mini shot in the arm and
they have some life after all.
I’m rolling 100% of my MSFT calls from the $25′s this week into next week’s $26 calls.
I’m overwriting on JPM, selling next week’s $46 calls. I’m also overwriting on FFIV, selling
next week’s $105 calls (and letting this week’s 105′s expire worthless).
Okay – that pretty much covers all the adjustments to my current MIT positions!
I hope you make it a great weekend!
–P
Master Income Update -
Tuesday, 3 May 2011
Hello,
Well today, the Chinese internets have been taking a big break across the board. For
several hours this morning, there wasn’t one news story on the likes of BIDU. The stock
was just down $5 bucks and on building volume.
SINA, SOHU – and the rest are getting hit. AMZN was hanging on, and now the selling’s
spread over there.
But all things in context. Stocks do this. And their prices are impersonal and their
timing is their own. There’s been a lot of stocks marching up, up and up – and to see
some steam blowing off is normal and what they do.
If your biggest position is BIDU, like my account is, you feel days like this as they happen.
But the stand back, bigger picture is I own a full boat of puts for all the stock, and for
this week, all the call premiums I sold last Thursday will be mine to keep.
When stocks behave like this – I immediately check the trend of the stock. I look at
50, 100 and 200 day moving averages. I look for gap downs, I look for volume.
And I of course look at any specific news to the stock…then to the sectors. This helps
me choose different strikes as I sell more weekly premiums and helps me decide how to
roll these weeklies too.
On the likes of AMZN – I’m kinda glad in a way that the stock is blowing off that strong
steam from their breakout. I sold 195 calls for this week – and the stock looked like it
was going to run wildly away from this area, leaving me without all that upside.
This back and forth, volatile (and upsloping) growth in the share price is what I’m after,
and I’m trading this way due to this world of headlines and volatile nature of stocks
themselves!
LVS (Las Vegas Sands…soon to be renamed just Sands, dropping the Las Vegas in the name)
announces after the close today.
That Macau region has been spectacular for Wynn – and so I’m staying in over earnings.
I own shares in LVS, and sell weekly calls…I also sell weekly puts for the nice premiums
in this name from time to time.
Anyway – that’s all I’ve got for the time being. Over and out!
–Pirate
P.S. I guess I haven’t mentioned on here just how much fun it was to meet one of the best
groups of folks out in Chicago last weekend. Man did we have fun touring the CBOE
floor, eating like kings and trading our butts off! I appreciate you dearly…and a lot told
me they’ll be seeing us again out in Salt Lake City in July! So if you’ve never been out to
one of these…you should think about the July date! –P
