New Options Broker with Significantly Less Trading Commissions

A new option's broker, OptionsHouse, now has the lowest commissions of all the option brokers. They are charging only $9.95 for each trade and nothing for each contact. If you trade 10 contracts, 20 contracts or 100 contracts per leg your total commissions is only $9.95 and nothing more. A credit spread trade is two option legs and costs only $19.90 no matter how many contracts are traded. This is a significant savings if you are trading 5 or more contracts. When you are paying only $19.90 per credit spread trade, or $39.80 per completed Iron Condor trade, you can easily afford the $29.95 subscription fee. I am very pleased that this broker has come along because I want my subscribers to earn a maximum net profit on each trade.

I am setting up a trading account with this new broker this month and will be creating Flash movies to illustrate how to order, protect and close Bull Put and Bear Call credit spread trades on the NDX, SPX and RUT stock indexes.

Update on Open Trades Expiring In July (20th)

With only 7 days remaining to expiration all filled trades should be expiring worthless on Friday July 20th. We have one open trade with a short option price that is close the Index price. The NDX Bear Call spread is 33 points away from the closing 7/13/2007 NDX Index price. I will be sending Trade Alerts next week along with updates in case we have to close and roll this trade. I have been reading market commentaries after last weeks record close. The majority say the Bulls stepped in and overtook the Bears but the Bears should return. If the Bears return next week and cause a market sell-off our Bull Put Trades will still be very safe and will expire on Friday.

Update on Open Trades Expiring In July (20th)

With only 14 days remaining to expiration all filled trades are safe and should be expiring worthless on Friday July 20th.

We now have two Iron Condor completed on the NDX and RUT index's. Completing the 20 point SPX Iron Condor trade is difficult with the SPX index rising week after week. I will continue to research safe Bear Call trades next week and if the SPX index has a few down days I should be able to order and email a safe trade. If I can complete 3 Iron Condors I will achieve a 6% total return for the month. The projected return on al l open trades listed below is 5.7% ($302/$5,323 required margin).

Update on Open Trades Expiring In July (20th)

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).

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.

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.

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.