Latest Update - Lots of Stuff and Info

TRADING RESULTS FOR WEEK ENDING:  August 12, 2011

Ok folks, after the PCLN mess we came back to what we know best and do well.  The high volatility for the week was a real hindrance to finding the path for the week.  Up one day, down the next.  We played this trend during the week to make our money. 

TRADES:

SPX    1195     Call     $2.15

SPX    1205     Call     $1.20     This gives a $0.95 Credit for a ROI of 9.5% per Thousand

SPX    1190     Call     $2.49

SPX    1200     Call     $1.54     This gives a $0.95 Credit for ROI of 9.5% per Thousand

GLD    166      Put     $0.44

GLD    164      Put     $0.29     This gives a $0.15 Credit and a ROI of 6.0% per Thousand

We put these trades on Wednesday afternoon.  At the time these were 2 SD away from the underlying price for the S&P and just under 2 SD for the GLD.  S&P was net losing for the week so we went the other way and put call options spreads on.  Just the opposite for the GLD.  Gold was going up – way up to record highs – so we went to the put side. We went out far enough to still get good returns (helped greatly by the high volatility) but still were far enough our that we could be thinking we were safe.  Turns out we were right.  The trend for Thursday and Friday was up for the S&P, and net down for gold, but were stayed safe by staying way wide with the SD.

Now to talk a little about the PCLN debacle.  This happened two Fridays ago.  This is a time where I should have stuck with the girl I brought to the ball.  I had my nice gain of almost 10% locked up, but thought I could make a little extra during the last minutes of the Friday trades.  I entered the trades and lost literally at the last minute when the strikes were violated.  I lost all my gain on that.  This is why I say the last minute trades are not for the faint of heart.  I basically lost the week of trading.  Lots of work for nothing but a hard lesson learned.  I still plan to do last minute trades, but have modified my rules to make anything over commission instead of trying to make a minimum of 3%. 

Now for the upcoming week:  Trades look like they will be SPX, GLD and maybe RUT or NDX.  Check the Twitter feed for the trades just after I do them. 

TTFN

Ash