With 21 days remaining to expiration all filled trades are safe and should be expiring worthless on Friday July 20th.
We have 4 trades open and one Iron Condor completed on the NDX index. A new Bear Call Rut trade was ordered and emailed this weekend and will complete a second Iron Condor trade with a 8.1% return. I hope to complete the 20 point SPX Iron Condor trade later next week. My goal this month is to have a 6% total return by completing 3 Iron Condor trades. The projected return on al l trades listed below is 5.7% ($302/$5,323 required margin).
Saturday, June 30, 2007
Saturday, June 23, 2007
Update on Open Trades Expiring In July (20th)
With 28 days remaining to expiration all filled trades are safe and should be expiring worthless on Friday July 20th.
With the market moving dramatically up one day and then down the next it makes it very hard to get credit spread orders filled. This month we had difficulty filling the NDX Bear call spread to complete an Iron Condor trade. I am emailing a replacement NDX Bear Call spread trade this weekend. Hopefully the market will cooperate next week and this Bear Call spread order is filled.
I have also ordered a new 20 point Bull Put SPX trade that has a 4.4% return. If I can complete a safe 20 point Bear Call SPX I should have a 7% or better return for the entire Iron Condor. I could not find a safe 10 or 15 point SPX trade. The only spread distance that is safe this month is 20 points.
With the market moving dramatically up one day and then down the next it makes it very hard to get credit spread orders filled. This month we had difficulty filling the NDX Bear call spread to complete an Iron Condor trade. I am emailing a replacement NDX Bear Call spread trade this weekend. Hopefully the market will cooperate next week and this Bear Call spread order is filled.
I have also ordered a new 20 point Bull Put SPX trade that has a 4.4% return. If I can complete a safe 20 point Bear Call SPX I should have a 7% or better return for the entire Iron Condor. I could not find a safe 10 or 15 point SPX trade. The only spread distance that is safe this month is 20 points.
Saturday, June 16, 2007
All June Trades Expired on Friday the 15th!!!!!
All Bull Put and Bear Call Spread trades expired worthless on Friday June 15th. All April and May trades expired and now now all the June trades expired. I will work hard to ensure this expiring trend continues for the remaining 6 months of 2007. My trading strategy is very conservative resulting in safe credit spread trades earning 3%-8% each. I will strive and complete safe Iron Condor trades earning 5%-8%. These trades complement single Bull Put and Bear Call trades earning 3%-5%. My goal for the remainder of 2007 is to earn a respectable 5% each month. This was accomplished this month.
The total return this month was 5.3% ($225/$4,275). All credit premiums collected totaled $225 (30+130+35) and $4,275 (970+2,370+935) margin was required per contract. If you traded 10 contracts per spread your credits totaled $2,250, 20 contracts $4,500. These are the returns and cash flows I expect to receive consistently each and every month. The return will be even higher in months when additional Iron Condors can be completed on each Index. In June we had two Iron Condor trades completed on the NDX Index. These trades required margin for one side and generated returns of 5.5% (130/2370) and 6.9% (30+35/935).
New trades expiring in July will be emailed later this weekend. I will continue to focus on selecting very safe trades and I already have a few Iron Condor and Bull Put trades identified. The NDX Bull Put and Bear Call 25 and 10 point spread trades have been very profitable and safe these past few months. The Bull Put RUT trades have also been very profitable. The SPX index continues to be a very difficult index to trade safely.
The total return this month was 5.3% ($225/$4,275). All credit premiums collected totaled $225 (30+130+35) and $4,275 (970+2,370+935) margin was required per contract. If you traded 10 contracts per spread your credits totaled $2,250, 20 contracts $4,500. These are the returns and cash flows I expect to receive consistently each and every month. The return will be even higher in months when additional Iron Condors can be completed on each Index. In June we had two Iron Condor trades completed on the NDX Index. These trades required margin for one side and generated returns of 5.5% (130/2370) and 6.9% (30+35/935).
New trades expiring in July will be emailed later this weekend. I will continue to focus on selecting very safe trades and I already have a few Iron Condor and Bull Put trades identified. The NDX Bull Put and Bear Call 25 and 10 point spread trades have been very profitable and safe these past few months. The Bull Put RUT trades have also been very profitable. The SPX index continues to be a very difficult index to trade safely.
Saturday, June 9, 2007
Update on Open Trades Expiring Next Week in June (15th)
With only 4 days remaining to expiration all filled trades are very safe and should be expiring worthless on Friday June 15th. We have 2 NDX Iron Condors and 1 RUT Bull Put Spread trade active. With the market acting so volatile last week it's hard to say if the bulls or the bears have the upper hand. I hope this tug of war causes the market to trade within a range. This would be a good environment for completing many Iron Condor trades.
I will email new trades expiring in July next weekend. June will be the 3rd month in a row that all fill trades have expired worthless.
HEDGING - The Only Way to Fully Protect Your Trading Balance and Accumulated Credits
My first hedge order was filled last week. Each month I will have one Trade Alert detailing my hedge trade. Please remember that this trade will only be profitable when a major event causes the market to drop by 8%, or 10%, or more. You can expect this event to occur at least once every 24 to 36 months.
Hedging with these stocks during earnings season can be very interesting if one of their reports includes a negative surprise. Your .02 cent or $2 options could rise to .10 and $10 very quickly. This is the other time you sell your Put options. Making an $8 profit per contract helps offset the cost of the creating these monthly hedges.
Please send me an email if you have any questions about this hedging strategy and the specific Put trade that expires in June.
I will email new trades expiring in July next weekend. June will be the 3rd month in a row that all fill trades have expired worthless.
HEDGING - The Only Way to Fully Protect Your Trading Balance and Accumulated Credits
My first hedge order was filled last week. Each month I will have one Trade Alert detailing my hedge trade. Please remember that this trade will only be profitable when a major event causes the market to drop by 8%, or 10%, or more. You can expect this event to occur at least once every 24 to 36 months.
Hedging with these stocks during earnings season can be very interesting if one of their reports includes a negative surprise. Your .02 cent or $2 options could rise to .10 and $10 very quickly. This is the other time you sell your Put options. Making an $8 profit per contract helps offset the cost of the creating these monthly hedges.
Please send me an email if you have any questions about this hedging strategy and the specific Put trade that expires in June.
Sunday, June 3, 2007
Update on Open Trades Expiring In June (15th)
With 14 days remaining to expiration all filled trades are safe and should be expiring worthless on Friday June 15th.
We continue to have trouble getting the NDX and RUT Bull Put Trades filled. I have added color highlighting to the summary report. You can now easily identify my trade alerts that have been filled (blue), trades that have not been filled and cancelled (red), and new trades that have orders placed (green). This is the fist month I have had these many replacement trades for earlier trades that were not filled and cancelled. With all the Indexes rising to new records each week it makes completing safe Bull Put trades very difficult. All we can do is keep ordering replacement trades with higher short and long option strikes. We only need one or 2 down days for these replacement orders to be filled next week.
My credit spread strategy works best when the market is hovering, trading neutrally or just rising very slowing. Today's market is a giant Bull Market and no one knows when the market will reverse. Even when China's market retreated 6% last week the US market increased over 100 points the next day. In February when China's market was down 5% the US market dropped over the 500 points the two days day after this event.
HEDGING - The Only to Fully Protect Your Trading Balances and Accumulated Credits
I have received many emails asking how we can best protect our trading balances and accumulated gains (credits) during an event like the one that occurred in February. My credit spread trading strategy now includes hedging to protect Bull Put spread trades. I do this by buying for $75 - $200, 25-75 Put contracts on an individual NDX/SPX stock. The contracts are trading in pennies and the ones I buy only cost $1-$3 (.01-.03 cents per share) per contract. This is like buying insurance. The other costs you have to include are your trading expenses. What is really nice about these hedges is that you can re-coup your monthly costs buying these Puts and also cover any losses closing the current month Bull Put Spreads.
If the market drops 500 points, like it did in February, these Put options will rise very quickly to $5, $10, $20 or much more. You potentially have a very large return on these contracts that only cost $1-$3 each. The money I spend each month for hedges is only a small % of the total credits I earn selling Bear and Put credit spreads. I know that someday the market will drop very fast again and I will re-coup all my hedging costs. I did not have a hedge in place in February but I only had to close the SPX Bull Put trade and this debit was covered by rolling to an NDX Iron Condor in the next month. The February RUT and NDX Bull Puts trades I had in place during the drop off never had to be closed.
I have ordered and emailed my first hedge trade this weekend to subscribers. Please send me an email if you have any questions about this hedging strategy and the specific Put trade that expires in June.
We continue to have trouble getting the NDX and RUT Bull Put Trades filled. I have added color highlighting to the summary report. You can now easily identify my trade alerts that have been filled (blue), trades that have not been filled and cancelled (red), and new trades that have orders placed (green). This is the fist month I have had these many replacement trades for earlier trades that were not filled and cancelled. With all the Indexes rising to new records each week it makes completing safe Bull Put trades very difficult. All we can do is keep ordering replacement trades with higher short and long option strikes. We only need one or 2 down days for these replacement orders to be filled next week.
My credit spread strategy works best when the market is hovering, trading neutrally or just rising very slowing. Today's market is a giant Bull Market and no one knows when the market will reverse. Even when China's market retreated 6% last week the US market increased over 100 points the next day. In February when China's market was down 5% the US market dropped over the 500 points the two days day after this event.
HEDGING - The Only to Fully Protect Your Trading Balances and Accumulated Credits
I have received many emails asking how we can best protect our trading balances and accumulated gains (credits) during an event like the one that occurred in February. My credit spread trading strategy now includes hedging to protect Bull Put spread trades. I do this by buying for $75 - $200, 25-75 Put contracts on an individual NDX/SPX stock. The contracts are trading in pennies and the ones I buy only cost $1-$3 (.01-.03 cents per share) per contract. This is like buying insurance. The other costs you have to include are your trading expenses. What is really nice about these hedges is that you can re-coup your monthly costs buying these Puts and also cover any losses closing the current month Bull Put Spreads.
If the market drops 500 points, like it did in February, these Put options will rise very quickly to $5, $10, $20 or much more. You potentially have a very large return on these contracts that only cost $1-$3 each. The money I spend each month for hedges is only a small % of the total credits I earn selling Bear and Put credit spreads. I know that someday the market will drop very fast again and I will re-coup all my hedging costs. I did not have a hedge in place in February but I only had to close the SPX Bull Put trade and this debit was covered by rolling to an NDX Iron Condor in the next month. The February RUT and NDX Bull Puts trades I had in place during the drop off never had to be closed.
I have ordered and emailed my first hedge trade this weekend to subscribers. Please send me an email if you have any questions about this hedging strategy and the specific Put trade that expires in June.
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